PERFORMANCE TARGETS AND PAYOUT PERCENTAGES
|
|
|
|
|
|
|
|
|
|
|
|
Threshold*
|
Target
|
Maximum
|
|
Weighting
|
|
Percentage Earned
|
|
(50% Payout)
|
(100% Payout)
|
(200% Payout for TSR
150% Payout for ROE)
|
|
|
|
|
Goals
|
|
|
|
|
|
|
|
Total Shareholder Return
|
30
th
Percentile
of EEI Regulated Index
|
50
th
Percentile
of EEI Regulated Index
|
90
th
Percentile
of EEI Regulated Index
|
|
50%
|
|
0 to 100%
|
Return on Equity
|
75%
of Allowed ROE
|
90%
of Allowed ROE
|
100%
of Allowed ROE
|
|
50%
|
|
0 to 75%
|
|
|
|
|
|
|
|
|
|
|
|
Total Percentage of Target Award Earned
|
0 to 175%
|
*Performance results below the threshold level for any goal will result in zero payouts with respect to that goal.
Dividend Equivalent Rights.
Each named executive officer will receive a number of dividend equivalent rights (“DERs”) equal to the number of vested performance RSUs. A DER represents the right to receive an amount equal to dividends paid on the number of shares of common stock equal to the number of the vested performance RSUs, which dividends have a record date between the date of the grant and the end of the performance period. DERs will be settled in shares of common stock after the related performance RSUs vest. The number of shares payable on the DERs will be calculated using the fair market value of common stock as of the date the committee determines the number of vested performance RSUs.
Service Requirement.
Vesting of the performance RSUs and their related DERs generally requires that the officer continue to be employed by the company during the performance period. However, if the officer’s employment is terminated due to retirement, death or disability before the normal vesting under the terms of the grant, a portion of the award will vest at the end of
the performance period. See the discussion of this issue in the section below entitled “Termination and Change in Control Benefits.”
Shareholder Approval of Stock Incentive Plan, as Amended and Restated.
As previously disclosed and as further discussed above in connection with Proposal 4, our Stock Incentive Plan, as originally drafted, provided that no awards could be granted after March 31, 2016. The performance RSUs awarded in 2017 were inadvertently made after the expiration of the term of the plan. The Board of Directors and the Compensation Committee each subsequently approved an amended and restated plan, effective as of March 31, 2016, to extend the term of the plan to March 31, 2024, subject to shareholder approval. No awards made under the plan after March 31, 2016 will be settled in common stock unless and until this approval is obtained.
Tax Treatment of 2017-2019 Performance RSUs.
Because the 2017-2019 performance RSUs were granted after the expiration of the term of our Stock Incentive Plan, they do not comply with the requirements for the performance-based compensation exception to Section 162(m).
2015-2017 Long-Term Incentive Awards
On February 13, 2018, the Compensation Committee and the other independent directors met to determine the results for the performance goals and the number of shares that would vest under the performance RSUs granted in 2015. The maximum number of performance RSUs that could vest under the awards was a function of company performance relative to the two performance goals described above, as well as a third goal, regulated asset base. Performance results were interpolated between threshold, target and maximum payout levels to determine payout percentages.
The 2015-2017 long-term incentive awards were intended to qualify as performance-based compensation for purposes of Internal Revenue Code Section 162(m). Consequently, under the terms of the plan, the Compensation Committee was required to exclude the impact on performance results of any “Extraordinary Event,” as defined in the plan. As discussed above, the Compensation Committee and other independent directors determined that the passage of the 2017 Tax Act constituted such an Extraordinary Event, and financial results were therefore adjusted to exclude the tax bill’s impact on our 2017 earnings. This resulted in adjusted ROE of 8.54% for 2017.
The performance results for the 2015-2017 awards are shown in the following tables:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RETURN ON EQUITY RESULTS
|
|
|
REGULATED ASSET BASE RESULTS
|
|
TSR RESULTS
|
|
2015
|
2016
|
2017*
|
Average
|
|
|
As of 12/31/2017 (Thousands)
|
|
|
2017
|
Allowed ROE
|
9.68
|
%
|
9.60
|
%
|
9.60
|
%
|
|
|
Target Asset Base
|
$5,318,992
|
|
Target
|
50th Percentile
|
Accounting ROE
|
8.26
|
%
|
8.38
|
%
|
8.54
|
%
|
|
|
Actual Asset Base
|
$5,557,663
|
|
Actual
|
36th Percentile
|
Accounting ROE as % of Allowed ROE
|
85.3
|
%
|
87.3
|
%
|
89.0
|
%
|
87.2%
|
|
Actual Amount as % of Target
|
104.5%
|
|
|
|
Payout Percentage
|
|
|
90.7%
|
|
|
150.0%
|
|
|
65.9%
|
*
Results adjusted to exclude impact of the 2017 Tax Act on earnings, as required under the terms of the Stock Incentive Plan.
Based on these results, 102.2% of the 2015-2017 performance RSUs vested, resulting in the award values set forth below. These values reflect the closing price of the company’s common stock on the vesting date of February 13, 2018.
2015-2017 LONG-TERM INCENTIVE AWARD PAYOUTS
|
|
|
|
|
|
|
RSUs Vested
|
Vesting Date Award Value *
|
James J. Piro
|
41,901
|
|
$1,673,526
|
James F. Lobdell
|
12,104
|
|
483,434
|
|
Maria M. Pope
|
13,190
|
|
526,809
|
|
J. Jeffrey Dudley
|
7,307
|
|
291,842
|
|
William O. Nicholson
|
6,520
|
|
260,409
|
|
W. David Robertson
|
6,020
|
|
240,439
|
|
*Based on company stock price of $39.94 on the vesting date of February 14, 2018.
The terms of the 2015-2017 long-term incentive awards are described more fully in the company’s 2016 proxy statement under the heading “2015 Grants of Plan-Based Awards.”
Other Compensation Practices
STOCK OWNERSHIP POLICY
In 2011, we adopted a stock ownership and holding policy for our executive officers. The primary objectives of the policy are to create financial incentives that align the interests of executive officers with strong operating and financial performance of the company, and encourage executive officers to operate the business of the company with a long-term perspective. Under the policy, our CEO is required to hold company stock with a value equal to at least three times her annual base salary, while the other executive officers are required to hold company stock with a value equal to at least one times their annual base salary. The policy does not require executive officers to immediately acquire shares in an amount sufficient to meet the holding requirement. However, until the holding requirement is met, executive officers are subject to certain restrictions on their ability to dispose of shares of company stock. The CEO is required to retain 100% of the CEO’s shares until the holding requirement is met. All other executive officers are required to retain an amount of shares equal to 50% of their net after-tax performance-based equity awards until the holding requirement is met. The number of shares required to satisfy the stock ownership requirements is re-calculated annually, based on the closing price of the company’s common stock on the date of the calculation. The Compensation Committee also reviews each officer’s holdings annually to ensure that appropriate progress toward the ownership goals is being made. Our stock ownership policy for non-employee directors is described on page 10 of this proxy statement.
CURRENT EQUITY GRANT PRACTICES
Under the terms of our Stock Incentive Plan, the Compensation Committee is authorized to make grants of equity awards, but may delegate this authority as it deems appropriate. The committee has delegated authority to our CEO to make annual discretionary grants of RSUs with performance-based or time-based vesting conditions to non-executive employees for the purposes of attracting and retaining qualified employees. The maximum RSU value that the CEO is authorized to award is $500,000 in the aggregate and $50,000 per award. The Compensation Committee has not delegated the authority to make executive awards.
We expect that we will continue to grant performance RSUs to the executive officers and other key employees, and to delegate authority to our CEO to make limited discretionary equity awards for attraction and retention purposes. We also expect to make annual grants of restricted stock units with time-based vesting conditions to the company’s directors.
The committee has not adopted a formal policy governing the timing of equity awards. However, we have generally made awards to officers in the first quarter of the fiscal year, and we expect to continue this practice.
CLAWBACK POLICY
In February 2017, our Board of Directors adopted a compensation clawback policy. Under the policy, if our Board of Directors determines that a current or former executive officer has engaged in fraud, willful misconduct, a knowing violation of law or one of our corporate policies, or any act or omission not in good faith, that caused or otherwise contributed to the need for a material restatement of our financial results, the Compensation Committee will review all performance-based compensation earned by that executive officer during fiscal periods materially affected by the restatement. If, in the Compensation Committee’s view, the performance-based compensation would have been materially lower if it had been based on the restated results, the Compensation Committee will seek recovery from that executive officer of any portion of such performance-based compensation as it deems appropriate under the circumstances after a review of all relevant facts and circumstances. The Board of Directors has sole discretion in determining whether an executive officer’s conduct has or has not met any particular standard of conduct. The clawback policy applies to performance-based compensation awards made after the adoption of the policy.
EXECUTIVE COMPENSATION TABLES
Summary Compensation
The table below shows the compensation earned by the company’s named executive officers during the years ended December 31,
2015
,
2016
and
2017
.
SUMMARY COMPENSATION TABLE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name and Principal Position
|
Year
|
|
Salary (2)
|
|
Stock Awards
(3)
|
|
Non-Equity Incentive Plan Compensation (4)
|
|
Change in Pension Value and Non-Qualified Deferred Compensation Earnings
(5)
|
|
All Other Compensation (6)
|
|
Totals
|
James J. Piro
Chief Executive Officer(1)
|
2017
|
|
|
$858,671
|
|
|
|
$1,562,979
|
|
|
|
$901,106
|
|
|
|
$138,351
|
|
|
|
$324,146
|
|
|
|
$3,785,253
|
|
2016
|
|
836,431
|
|
|
1,517,452
|
|
|
680,574
|
|
|
135,052
|
|
|
148,124
|
|
|
3,317,633
|
|
2015
|
|
805,549
|
|
|
1,395,704
|
|
|
688,826
|
|
|
41,221
|
|
|
138,451
|
|
|
3,069,751
|
|
James F. Lobdell
Senior Vice President, Finance, Chief Financial Officer and Treasurer
|
2017
|
|
457,362
|
|
|
519,114
|
|
|
264,111
|
|
|
190,458
|
|
|
63,100
|
|
|
1,494,145
|
|
2016
|
|
449,074
|
|
|
461,998
|
|
|
206,396
|
|
|
114,897
|
|
|
45,824
|
|
|
1,278,189
|
|
2015
|
|
413,356
|
|
|
402,470
|
|
|
201,648
|
|
|
14,470
|
|
|
44,943
|
|
|
1,076,887
|
|
Maria M. Pope
President (1)
|
2017
|
|
540,491
|
|
|
545,362
|
|
|
333,540
|
|
|
88,124
|
|
|
71,937
|
|
|
1,579,454
|
|
2016
|
|
477,576
|
|
|
494,985
|
|
|
245,180
|
|
|
55,384
|
|
|
60,683
|
|
|
1,333,808
|
|
2015
|
|
464,728
|
|
|
438,582
|
|
|
234,258
|
|
|
25,302
|
|
|
64,135
|
|
|
1,227,005
|
|
J. Jeffrey Dudley
Vice President, General Counsel and Corporate Compliance Officer
|
2017
|
|
203,768
|
|
|
342,992
|
|
|
113,943
|
|
|
47,281
|
|
|
117,238
|
|
|
825,222
|
|
2016
|
|
398,086
|
|
|
332,983
|
|
|
166,364
|
|
|
54,397
|
|
|
48,352
|
|
|
1,000,182
|
|
2015
|
|
385,729
|
|
|
289,784
|
|
|
169,364
|
|
|
(1,375
|
)
|
|
48,796
|
|
|
892,298
|
|
William O. Nicholson
Senior Vice President, Customer Service, Transmission & Distribution
|
2017
|
|
332,534
|
|
|
230,684
|
|
|
174,173
|
|
|
198,538
|
|
|
43,278
|
|
|
979,207
|
|
2016
|
|
322,903
|
|
|
223,992
|
|
|
135,991
|
|
|
120,053
|
|
|
39,627
|
|
|
842,566
|
|
2015
|
|
317,720
|
|
|
216,781
|
|
|
142,684
|
|
|
46,614
|
|
|
43,586
|
|
|
767,385
|
|
W. David Robertson
Vice President, Public Policy
|
2017
|
|
309,599
|
|
|
218,894
|
|
|
137,817
|
|
|
111,974
|
|
|
41,330
|
|
|
819,614
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Mr. Piro resigned as President effective October 1, 2017 and as CEO effective January 1, 2018 in connection with his retirement from the company. Ms. Pope was appointed President effective October 1, 2017 and previously served as Senior Vice President, Power Supply, Operations and Resource Strategy.
|
|
|
(2)
|
Amounts in the Salary column include base salary earned and, where applicable, the value of paid time off deferred under the company's 2005 Management Deferred Compensation Plan (“2005 MDCP”). Ms. Pope’s salary for 2017 reflects an increase in annual salary from $454,500 to $650,000, effective October 1, 2017.
|
|
|
(3)
|
Amounts in the Stock Awards column constitute the aggregate grant date fair value of awards of restricted stock units with performance-based vesting conditions (“performance RSUs”), computed in accordance with Financial Accounting Standards Board Accounting Standards Codification (FASB ASC) Topic 718, Compensation - Stock Compensation, excluding the effect of estimated forfeitures related to service-based vesting. These amounts reflect the grant date fair value, in each case valued using the closing market price of the company's common stock on the New York Stock Exchange on the grant date, and may not correspond to the actual value that will be realized. The grant date fair values of the performance RSUs assume performance at target levels, which would allow the vesting of 100% of the RSUs awarded. If the maximum number of shares issuable under the performance RSUs had been used in this calculation in lieu of the target number of shares, the amounts in the table for fiscal
2017
would have been as follows:
|
|
|
|
|
|
Name
|
Maximum 2017 Performance RSU Value
|
James J. Piro
|
|
$2,735,202
|
|
James F. Lobdell
|
908,448
|
|
Maria M. Pope
|
954,405
|
|
J. Jeffrey Dudley
|
600,225
|
|
William O. Nicholson
|
403,707
|
|
W. David Robertson
|
383,053
|
|
|
|
(4)
|
Amounts in the Non-Equity Incentive Plan Compensation column represent cash payments under the company's 2008 Annual Cash Incentive Master Plan for Executive Officers (“Annual Cash Incentive Plan”). The terms of the
2017
awards are discussed below in the section entitled “Grants of Plan-Based Awards.”
|
|
|
(5)
|
Amounts in this column include the increase or decrease in the actuarial present value of the named executive officers' accumulated benefits under the Portland General Electric Company Pension Plan (“Pension Plan”) and above-market interest in the 2005 MDCP. Also included are increases or decreases in deferred compensation account balances arising from the Pension Plan benefit restoration feature of the 2005 MDCP. This feature is explained below in the section entitled “Pension Benefits — MDCP Restoration of Pension Benefits.” These amounts for
2017
are shown below:
|
|
|
|
|
|
|
|
|
Name
|
|
Plan
|
|
Increase or Decrease in
Actuarial Present Value
|
James J. Piro
|
|
Pension Plan
|
|
|
$138,351
|
|
|
|
2005 MDCP
|
|
—
|
|
James F. Lobdell
|
|
Pension Plan
|
|
190,458
|
|
|
|
2005 MDCP
|
|
—
|
|
Maria M. Pope
|
|
Pension Plan
|
|
88,124
|
|
|
|
2005 MDCP
|
|
—
|
|
J. Jeffrey Dudley
|
|
Pension Plan
|
|
40,906
|
|
|
|
2005 MDCP
|
|
6,375
|
|
William O. Nicholson
|
|
Pension Plan
|
|
198,538
|
|
|
|
2005 MDCP
|
|
—
|
|
W. David Robertson
|
|
Pension Plan
|
|
111,974
|
|
|
|
2005 MDCP
|
|
—
|
|
The balance of the amounts in the Change in Pension Value and Non-Qualified Deferred Compensation Earnings column reflects above-market interest (defined as above 120% of the long-term Applicable Federal Rate) earned on balances under the 2005 MDCP and the Management Deferred Compensation Plan adopted in 1986 (”1986 MDCP”).
|
|
(6)
|
The figures in this column for
2017
include contributions under the 2005 MDCP, the value of dividend equivalent rights earned under the Stock Incentive Plan, contributions to the 401(k) Plan and, in the case of Mr. Piro and Mr. Dudley, the value of accrued but unused vacation payable upon termination of employment. These amounts are set forth in the table below:
|
ALL OTHER COMPENSATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
2005 MDCP Contributions
|
Dividend Equivalent Rights*
|
401(k) Contributions
|
Accrued Vacation
|
Total
|
James J. Piro
|
|
$7,345
|
|
|
$163,987
|
|
|
$16,200
|
|
|
$136,614
|
|
|
$324,146
|
|
James F. Lobdell
|
1,159
|
|
45,741
|
|
16,200
|
|
—
|
|
63,100
|
|
Maria M. Pope
|
—
|
|
56,154
|
|
15,783
|
|
—
|
|
71,937
|
|
J. Jeffrey Dudley
|
2,532
|
|
36,016
|
|
6,190
|
|
72,500
|
|
117,238
|
|
William O. Nicholson
|
98
|
|
26,980
|
|
16,200
|
|
—
|
|
43,278
|
|
W. David Robertson
|
—
|
|
25,130
|
|
16,200
|
|
—
|
|
41,330
|
|
*The value of the dividend equivalent rights was not included in the “Stock Awards” column in the Summary Compensation Table.
Grants of Plan-Based Awards
The following table provides information about awards granted to the named executive officers in
2017
.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Estimated Possible Payouts Under Non-Equity Incentive Plan Awards (1)
|
|
Estimated Future Payouts Under Equity Incentive Plan Awards (2)
|
|
|
Name
|
Grant Date
|
|
Threshold
|
|
Target
|
|
Maximum
|
|
Threshold
(Number of
Shares)
|
|
Target
(Number of
Shares)
|
|
Maximum
(Number
of Shares)
|
|
Grant Date Fair
Value of Stock
Awards (3)
|
James J. Piro
|
|
|
|
$402,711
|
|
|
|
$805,422
|
|
|
|
$1,208,132
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2/15/2017
|
|
|
|
|
|
|
|
|
|
18,162
|
|
|
36,323
|
|
|
63,565
|
|
|
|
$1,562,979
|
|
James F. Lobdell
|
|
|
118,033
|
|
|
236,066
|
|
|
354,100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2/15/2017
|
|
|
|
|
|
|
|
|
|
|
6,032
|
|
|
12,064
|
|
|
21,112
|
|
|
519,114
|
|
Maria M. Pope
|
|
|
136,028
|
|
|
272,056
|
|
|
408,083
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2/15/2017
|
|
|
|
|
|
|
|
|
|
6,337
|
|
|
12,674
|
|
|
22,180
|
|
|
545,362
|
|
J. Jeffrey Dudley
|
|
|
94,529
|
|
|
189,059
|
|
|
283,588
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2/15/2017
|
|
|
|
|
|
|
|
|
|
|
3,986
|
|
|
7,971
|
|
|
13,949
|
|
|
342,992
|
|
William O. Nicholson
|
|
|
81,756
|
|
|
163,512
|
|
|
245,268
|
|
|
|
|
|
|
|
|
|
2/15/2017
|
|
|
|
|
|
|
|
2,681
|
|
|
5,361
|
|
|
9,382
|
|
|
230,684
|
|
W. David Robertson
|
|
|
61,591
|
|
|
123,183
|
|
|
184,774
|
|
|
|
|
|
|
|
|
|
2/15/2017
|
|
|
|
|
|
|
|
2,544
|
|
|
5,087
|
|
|
8,902
|
|
|
218,894
|
|
|
|
(1)
|
These columns show the range of potential payouts for cash incentive awards granted in
2017
under the Annual Cash Incentive Plan. The amounts shown in the Threshold column are the payouts when threshold performance is achieved, which are 50% of target awards for each executive. The amounts in the Target column reflect payouts at target level of performance, which are 100% of the target awards. The amounts shown in the Maximum column reflect maximum payouts, which are 150% of the target awards. See the section of the Compensation Discussion and Analysis entitled “Annual Cash Incentive Awards” on pages 36 to 40 for a description of the terms of the awards.
|
|
|
(2)
|
These columns show the estimated range of potential payouts for awards of performance RSUs granted in
2017
under the Stock Incentive Plan. The amounts shown in the Threshold column reflect the minimum number of RSUs that could vest, which is 50% of the target amount shown in the Target column. The number of RSUs shown in the Maximum column is equal to 175% of the target amount. Settlement of the award in shares of the company’s common stock is contingent on the approval by the company’s shareholders of the amended and restated Stock Incentive Plan, as described in Proposal 4 of this proxy statement. See the section of the Compensation Discussion and Analysis entitled “Long-Term Equity Incentive Awards” on pages 41 to 44 for a description of the terms of the awards.
|
|
|
(3)
|
The grant date fair values for the performance RSUs assume performance at target levels and a stock price of $
43.03
(the closing price of the company’s common stock on February 15, 2017, the date of the grant). The grant date fair values of the performance RSUs assume that the executive will continue to be employed by the company throughout the performance period.
|
Outstanding Equity Awards at Fiscal Year-End
The following table shows, for each named executive officer, the unvested performance RSUs that were outstanding on December 31,
2017
.
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
Grant Date
|
Number of
Units
of Stock
That Have
Not Vested
|
Market Value
of Units of Stock
That Have Not
Vested
(4)
|
Equity Incentive Plan
Awards: Number of
Unearned Units That
Have Not Vested
(5)
|
Equity Incentive
Plan Awards:
Market Value of
Unearned Units
That Have Not
Vested
(6)
|
James J. Piro
|
02/15/2017 (1)
|
—
|
|
—
|
|
63,565
|
|
|
$2,897,293
|
|
|
02/17/2016 (2)
|
—
|
|
—
|
|
60,585
|
|
2,761,464
|
|
|
02/18/2015 (3)
|
38,347
|
|
|
$1,747,856
|
|
—
|
|
—
|
|
James F. Lobdell
|
02/15/2017 (1)
|
—
|
|
—
|
|
21,112
|
|
962,285
|
|
|
02/17/2016 (2)
|
—
|
|
—
|
|
18,446
|
|
840,769
|
|
|
02/18/2015 (3)
|
11,058
|
|
504,024
|
|
—
|
|
—
|
|
Maria M. Pope
|
02/15/2017 (1)
|
—
|
|
—
|
|
22,180
|
|
1,010,964
|
|
|
02/17/2016 (2)
|
—
|
|
—
|
|
19,763
|
|
900,798
|
|
|
02/18/2015 (3)
|
12,050
|
|
549,239
|
|
—
|
|
—
|
|
J. Jeffrey Dudley
|
02/15/2017 (1)
|
—
|
|
—
|
|
13,949
|
|
635,795
|
|
|
02/17/2016 (2)
|
—
|
|
—
|
|
13,295
|
|
605,986
|
|
|
02/18/2015 (3)
|
7,962
|
|
362,908
|
|
—
|
|
—
|
|
William O. Nicholson
|
02/15/2017 (1)
|
—
|
|
—
|
|
9,382
|
|
427,632
|
|
|
02/17/2016 (2)
|
—
|
|
—
|
|
8,943
|
|
407,622
|
|
|
02/18/2015 (3)
|
5,956
|
|
271,474
|
|
—
|
|
—
|
|
W. David Robertson
|
02/15/2017 (1)
|
—
|
|
—
|
|
8,902
|
|
405,753
|
|
|
02/17/2016 (2)
|
—
|
|
—
|
|
8,244
|
|
375,762
|
|
|
02/18/2015 (3)
|
5,500
|
|
250,690
|
|
—
|
|
—
|
|
|
|
(1)
|
Amounts in this row relate to performance RSUs with a three-year performance period ending December 31, 2019. The awards will vest in the first quarter of 2020, when the Compensation Committee, or in the case of Ms. Pope, the independent directors, determine the performance results and whether to make any adjustments to payouts under the awards. Settlement of the award in shares of the company’s common stock is contingent on the approval by the company’s shareholders of the Amended and Restated Stock Incentive Plan, as described in Proposal 4 of this proxy statement.
|
|
|
(2)
|
Amounts in this row relate to performance RSUs with a three-year performance period ending December 31, 2018. The awards will vest in the first quarter of 2019, when the Compensation Committee, or in the case of Ms. Pope, the independent directors, determine the performance results and whether to make any downward adjustments to payouts under the awards.
|
|
|
(3)
|
Amounts in this row relate to performance RSUs with a three-year performance period ending December 31, 2017. The awards vested on February 14, 2018, when the Compensation Committee, or in the case of Mr. Piro and Ms. Pope, the independent directors, determined the performance results and whether to make any downward adjustments to payouts under the awards. Amounts in this row are based on a performance percentage of 102.2%.
|
|
|
(4)
|
Amounts in this column reflect a value of $45.58 per unit (the closing price of the company's common stock on December 29,
2017
) and performance percentage of 102.2%.
|
|
|
(5)
|
Amounts in this column are the number of performance RSUs granted in 2016 and 2017, none of which had vested as of December 31,
2017
. The amounts shown assume the maximum level of performance.
|
|
|
(6)
|
Amounts in this column reflect the value of performance RSUs granted in 2016 and 2017, assuming a value of $45.58 per unit (the closing price of the company's common stock on December 29,
2017
) and performance at maximum levels.
|
Stock Units Vested
The following table shows, for each of the named executive officers, the number and aggregate value of restricted stock units with performance-based vesting conditions and related dividend equivalent rights that vested during 2017.
|
|
|
|
|
|
|
|
Name
|
Number of Shares Acquired on Vesting of Restricted Stock Units
|
|
Value Realized on Vesting
|
James J. Piro
|
49,943
|
|
|
|
$2,149,047
|
|
James F. Lobdell
|
13,923
|
|
|
599,107
|
|
Maria M. Pope
|
17,106
|
|
|
736,071
|
|
J. Jeffrey Dudley
|
10,978
|
|
|
472,383
|
|
William O. Nicholson
|
8,214
|
|
|
353,448
|
|
W. David Robertson
|
7,657
|
|
|
329,481
|
|
Pension Benefits
The following table shows, for each of the named executive officers, the actuarial present value of (i) the officer’s accumulated benefit under the Pension Plan and (ii) the amounts accrued pursuant to the pension makeup feature of the deferred compensation plans for management (the “1986 MDCP” and the “2005 MDCP”) as of December 31,
2017
.
|
|
|
|
|
|
|
|
|
|
Name
|
Plan Name
|
|
Number of Years
Credited Service
|
|
Present Value of
Accumulated Benefit
|
James J. Piro
|
Pension Plan
|
|
37.6
|
|
|
|
$1,796,961
|
|
|
1986 MDCP and 2005 MDCP
|
|
37.6
|
|
|
—
|
|
James F. Lobdell
|
Pension Plan
|
|
33.2
|
|
|
1,436,691
|
|
|
1986 MDCP and 2005 MDCP
|
|
33.2
|
|
|
—
|
|
Maria M. Pope
|
Pension Plan
|
|
9.0
|
|
|
354,834
|
|
|
2005 MDCP
|
|
9.0
|
|
|
—
|
|
J. Jeffrey Dudley
|
Pension Plan
|
|
29.0
|
|
|
1,231,348
|
|
|
1986 MDCP and 2005 MDCP
|
|
29.0
|
|
|
191,908
|
|
William O. Nicholson
|
Pension Plan
|
|
37.5
|
|
|
1,509,523
|
|
|
1986 MDCP and 2005 MDCP
|
|
37.5
|
|
|
—
|
|
W. David Robertson
|
Pension Plan
|
|
13.6
|
|
|
462,605
|
|
|
1986 MDCP and 2005 MDCP
|
|
13.6
|
|
|
—
|
|
PENSION PLAN
Participants earn benefits under the Pension Plan during each year of employment. Employees are vested in plan benefits after 5 years of service. Normal retirement age under the plan is 65. Early retirement income is available to participants after age 55, but benefits are reduced for each year prior to the normal retirement date. Each of the named executive officers, other than Ms. Pope, is currently eligible for early retirement under the Pension Plan.
For non-union plan participants, the basic monthly pension benefit is based on Final Average Earnings (“FAE”), defined as the highest consecutive 60 months of earnings (base pay paid, excluding reductions due to income deferrals) during the last 120 months of employment.
The basic pension benefit under the plan is calculated as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Monthly Benefit
|
|
=
|
|
1.2% of FAE for first 30 years of service
|
|
+
|
|
0.5% of FAE in excess of 35-Year Average of Social Security Taxable Wage Base
|
|
+
|
|
0.5% of FAE for each year of service over 30 years
|
The normal form of payment for a participant who does not have a spouse is a straight life annuity, which makes periodic payments to the participant until his or her death. The normal form of payment if the participant has a spouse is a contingent
annuity, which makes full payments for the life of the participant and thereafter 50% of the full payments until the death of the spouse if he or she survives the participant.
Pension plan calculations are based on assumptions that are reviewed annually with the company’s actuaries. The benefit calculation shown in the table above assumes retirement at age 65 (or current age if later), a discount rate of 4.84% and mortality assumptions based on the Generational Annuitant Mortality (RP 2000 with Scale BB projections). These assumptions are the same ones used for financial reporting purposes.
MDCP RESTORATION OF PENSION BENEFITS
The 1986 MDCP and 2005 MDCP (“MDCP Plans”) provide a benefit to compensate participants for Pension Plan benefits that are lower due to salary deferrals under the MDCP Plans. These deferrals reduce a participant’s Final Average Earnings, on which Pension Plan benefits are based. The present value of the reduction in Pension Plan benefits due to salary deferrals is calculated as a lump sum upon termination of employment and added to the participant’s deferred compensation plan account balance. The aggregate present value of this benefit is reflected in the Pension Benefits table above.
Non-Qualified Deferred Compensation
We offer a select group of management and highly compensated employees an opportunity to defer compensation under the 2005 MDCP. Before January 1, 2005 (the effective date of the 2005 MDCP), eligible employees were eligible to defer compensation under the 1986 MDCP. The following table shows the named executive officers’ contributions and earnings in
2017
and balances as of December 31,
2017
under these plans. The accompanying narrative describes important provisions of the plans.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
Plan
|
|
Executive
Contributions
in 2017
(1)
|
|
Company
Contributions
in 2017
(2)
|
|
Aggregate
Earnings
in 2017
(3)
|
|
Aggregate
Balance
at 12/31/17
(4)
|
James J. Piro
|
|
2005 MDCP
|
|
|
$485,035
|
|
|
|
$7,345
|
|
|
|
$135,898
|
|
|
|
$3,272,922
|
|
|
|
1986 MDCP
|
|
—
|
|
|
—
|
|
|
217,946
|
|
|
3,286,195
|
|
James F. Lobdell
|
|
2005 MDCP
|
|
105,764
|
|
|
1,159
|
|
|
35,706
|
|
|
852,497
|
|
|
|
1986 MDCP
|
|
—
|
|
|
—
|
|
|
106,793
|
|
|
1,610,234
|
|
Maria M. Pope
|
|
2005 MDCP
|
|
60,699
|
|
|
—
|
|
|
46,109
|
|
|
1,071,950
|
|
|
|
1986 MDCP
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
J. Jeffrey Dudley
|
|
2005 MDCP
|
|
196,178
|
|
|
2,532
|
|
|
83,117
|
|
|
2,037,666
|
|
|
|
1986 MDCP
|
|
—
|
|
|
—
|
|
|
17,145
|
|
|
243,547
|
|
William O. Nicholson
|
|
2005 MDCP
|
|
7,358
|
|
|
98
|
|
|
6,287
|
|
|
146,662
|
|
|
|
1986 MDCP
|
|
—
|
|
|
—
|
|
|
69,667
|
|
|
1,050,448
|
|
W. David Robertson
|
|
2005 MDCP
|
|
11,365
|
|
|
—
|
|
|
6,227
|
|
|
143,544
|
|
|
|
1986 MDCP
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
(1)
|
Amounts in this column include salary and paid-time-off deferrals that are reflected in the “Salary” column, and cash incentive award deferrals that are reflected in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table.
|
|
|
(2)
|
Amounts in this column include a company matching contribution of 3% of annual base salary deferred under the plans. These amounts are included in the Summary Compensation Table under “All Other Compensation.”
|
|
|
(3)
|
Amounts in this column are included in the Summary Compensation Table under “Change in Pension Value and Non-Qualified Deferred Compensation Earnings” to the extent that the earnings are above-market.
|
|
|
(4)
|
Amounts in this column are reflected in the Summary Compensation Table under “Change in Pension Value and Non-Qualified Deferred Compensation Earnings” only to the extent described in footnotes (1) to (3) above.
|
Each calendar year participants may defer up to 80% of their base salary and 100% of their cash incentive compensation. Participants may also contribute cash payments in lieu of up to 160 hours of canceled paid time off (the excess, as of year-end, of their unused paid time off over 200 hours). The company provides a 3% matching contribution for base salary deferred. The 2005 MDCP and 1986 MDCP also provide for company contributions to compensate participants for lower Pension Plan payments they may receive as a result of participating in the plans. See the section above entitled “Pension Benefits — MDCP Restoration of Pension Benefits.”
Amounts deferred under the 2005 MDCP accrue interest that is .5% higher than the annual yield on Moody’s Average Corporate Bond Yield Index. The 1986 MDCP provides interest that is 3.0% higher than the same Moody’s index.
Under the 2005 MDCP, participants begin receiving payments six months after their separation from service. A participant’s account balance during the six-month delay continues to accrue interest. Under both plans, benefits are paid in one of the
following forms, as elected by the participant in a payment election form filed each year: (i) a lump-sum payment; (ii) monthly installments in equal payments of principal and interest over a period of up to 180 months; or (iii) monthly installment payments over a period of up to 180 months, consisting of interest only payments for up to 120 months and principal and interest payments of the remaining account balance over the remaining period. If the participant is under 55 years of age upon termination of employment, the restoration of pension benefits payment is made in a lump sum with the first monthly payment.
Termination and Change in Control Benefits
The tables below show the estimated value of payments and other benefits to which the named executive officers would be entitled under the company’s plans and programs upon termination of employment in specified circumstances and following a change in control of the company. The amounts shown assume that the effective date of the termination or change in control is December 31,
2017
. Benefits that are generally available to salaried employees or disclosed above under “Pension Benefits” and “Non-Qualified Deferred Compensation” are not shown below.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
James J. Piro
|
|
|
|
|
|
|
|
|
|
|
Benefit Plan
|
|
Retirement
|
|
Involuntary
Not for Cause
Termination
|
|
Change in
Control
|
|
Termination Following Change in Control
|
|
Death or Disability
|
Deferred Compensation Plans(1)
|
|
—
|
|
|
—
|
|
|
|
$131,448
|
|
|
—
|
|
|
—
|
|
Severance Pay Plan(2)
|
|
—
|
|
|
|
$822,622
|
|
|
—
|
|
|
|
$1,628,044
|
|
|
—
|
|
Performance RSUs(3)(4)
|
|
|
$3,835,192
|
|
|
—
|
|
|
—
|
|
|
3,711,807
|
|
|
|
$3,835,192
|
|
Annual Cash Incentive Award(5)
|
|
901,106
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
901,106
|
|
Outplacement Assistance Plan(6)
|
|
—
|
|
|
8,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total
|
|
4,736,298
|
|
|
830,622
|
|
|
131,448
|
|
|
5,339,851
|
|
|
4,736,298
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
James F Lobdell
|
|
|
|
|
|
|
|
|
|
|
Benefit Plan
|
|
Retirement
|
|
Involuntary
Not for Cause
Termination
|
|
Change in
Control
|
|
Termination Following Change in Control
|
|
Death or Disability
|
Deferred Compensation Plans(1)
|
|
—
|
|
|
—
|
|
|
|
$64,409
|
|
|
—
|
|
|
—
|
|
Severance Pay Plan(2)
|
|
—
|
|
|
|
$432,604
|
|
|
—
|
|
|
|
$668,671
|
|
|
—
|
|
Performance RSUs(3)(4)
|
|
|
$1,153,220
|
|
|
—
|
|
|
—
|
|
|
1,114,522
|
|
|
|
$1,153,220
|
|
Annual Cash Incentive Award(5)
|
|
264,111
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
264,111
|
|
Outplacement Assistance Plan(6)
|
|
—
|
|
|
8,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total
|
|
1,417,331
|
|
|
440,604
|
|
|
64,409
|
|
|
1,783,193
|
|
|
1,417,331
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Maria M. Pope
|
|
|
|
|
|
|
|
|
|
|
Benefit Plan
|
|
Retirement
|
|
Involuntary
Not for Cause
Termination
|
|
Change in
Control
|
|
Termination Following Change in Control
|
|
Death or Disability
|
Deferred Compensation Plans(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Severance Pay Plan(2)
|
|
—
|
|
|
|
$650,000
|
|
|
—
|
|
|
|
$922,056
|
|
|
—
|
|
Performance RSUs(3)(4)
|
|
|
$1,241,599
|
|
|
—
|
|
|
—
|
|
|
1,200,395
|
|
|
|
$1,241,599
|
|
Annual Cash Incentive Award(5)
|
|
333,540
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
333,540
|
|
Outplacement Assistance Plan(6)
|
|
—
|
|
|
8,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total
|
|
1,575,139
|
|
|
658,000
|
|
|
—
|
|
|
2,122,451
|
|
|
1,575,139
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
J. Jeffrey Dudley
|
|
|
|
|
|
|
|
|
|
|
Benefit Plan
|
|
Retirement
|
|
Involuntary
Not for Cause
Termination
|
|
Change in
Control
|
|
Termination Following Change in Control
|
|
Death or Disability
|
Deferred Compensation Plans(1)
|
|
—
|
|
|
—
|
|
|
|
$9,742
|
|
|
—
|
|
|
—
|
|
Severance Pay Plan(2)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Performance RSUs(3)(4)
|
|
|
$819,255
|
|
|
—
|
|
|
—
|
|
|
|
$792,089
|
|
|
|
$819,255
|
|
Annual Cash Incentive Award(5)
|
|
113,943
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
113,943
|
|
Outplacement Assistance Plan(6)
|
|
—
|
|
|
|
$8,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total
|
|
933,198
|
|
|
8,000
|
|
|
9,742
|
|
|
792,089
|
|
|
933,198
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
William O. Nicholson
|
|
|
|
|
|
|
|
|
|
|
Benefit Plan
|
|
Retirement
|
|
Involuntary
Not for Cause
Termination
|
|
Change in
Control
|
|
Termination Following Change in Control
|
|
Death or Disability
|
Deferred Compensation Plans(1)
|
|
—
|
|
|
—
|
|
|
|
$42,018
|
|
|
—
|
|
|
—
|
|
Severance Pay Plan(2)
|
|
—
|
|
|
|
$329,608
|
|
|
—
|
|
|
|
$493,120
|
|
|
—
|
|
Performance RSUs(3)(4)
|
|
|
$580,689
|
|
|
—
|
|
|
—
|
|
|
562,503
|
|
|
|
$580,689
|
|
Annual Cash Incentive Award(5)
|
|
174,173
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
174,173
|
|
Outplacement Assistance Plan(6)
|
|
—
|
|
|
8,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total
|
|
754,862
|
|
|
337,608
|
|
|
42,018
|
|
|
1,055,623
|
|
|
754,862
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W. David Robertson
|
|
|
|
|
|
|
|
|
|
|
Benefit Plan
|
|
Retirement
|
|
Involuntary
Not for Cause
Termination
|
|
Change in
Control
|
|
Termination Following Change in Control
|
|
Death or Disability
|
Deferred Compensation Plans(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Severance Pay Plan(2)
|
|
—
|
|
|
|
$312,723
|
|
|
—
|
|
|
|
$435,906
|
|
|
—
|
|
Performance RSUs(3)(4)
|
|
|
$538,072
|
|
|
—
|
|
|
—
|
|
|
521,116
|
|
|
|
$538,072
|
|
Annual Cash Incentive Award(5)
|
|
137,817
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
137,817
|
|
Outplacement Assistance Plan(6)
|
|
—
|
|
|
8,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total
|
|
675,889
|
|
|
320,723
|
|
|
—
|
|
|
957,022
|
|
|
675,889
|
|
|
|
(1)
|
In the event of a Change of Control, as defined in the 1986 MDCP, participants are eligible to take an accelerated distribution of their account balances at a reduced forfeiture rate. See the section below entitled “Management Deferred Compensation Plan - Effect of Change in Control” for additional information. The amount shown in the Change in Control column is the amount by which the forfeiture would be reduced, assuming that a Change in Control occurred on December 31,
2017
and the officer elected to take an early distribution of his or her 1986 MDCP account balance as of that date. Ms. Pope and Mr. Robertson do not have an account balance under the 1986 MDCP.
|
|
|
(2)
|
The amounts shown in the Involuntary Not for Cause Termination column assume 12 months of pay at
2017
salary levels for all named executive officers. The amounts shown in the Termination Following Change in Control column consist of 52 weeks of base salary plus the value of the target cash incentive award for the fiscal year in which the termination occurs and are based on 2017 base salaries and the cash incentive award payouts for 2017, which ranged from 106.52% to 122.60% of target.
|
|
|
(3)
|
Amounts in this row under the headings “Retirement” and “Death or Disability” constitute the value of performance RSUs granted under the Stock Incentive Plan that would vest, assuming performance at 102.1% of target performance for the 2017 grants, 105.0% of target performance for the 2016 grants, and 102.2% of target performance for the 2015. The payout percentages for the 2017 and 2016 grants are based on forecasted results. The payout percentage for the 2015 grants is based on actual results. The values reflect the closing price of the company’s common stock as of December 31,
2017
($45.58).
|
|
|
(4)
|
The amount in this row under the heading “Termination Following Change in Control” shows the value of the performance RSUs granted under the Stock Incentive Plan in 2015, 2016 and 2017. These grants included provisions for accelerated vesting in the event of a termination following a Change in Control, as more fully described in the narrative below. The value shown reflects the closing price of the company's common stock as of December 31,
2017
($45.58).
|
|
|
(5)
|
Under the company's Annual Cash Incentive Plan, if a participant's employment terminates due to the participant’s death, disability or retirement prior to payment being made under an award, the company would pay an award to the participant or the participant's estate at the same time that awards are payable generally to other participants, pro-rated to reflect the number of full and partial months during the
|
award year during which the participant was employed by the company. The amount of the payout would be based on actual performance results for the year.
|
|
(6)
|
Amounts in this row are the estimated value of outplacement assistance consulting services received, assuming that the executive is granted six months of outplacement assistance, at a value of $5,000 for the first three months and $3,000 for an additional three months.
|
MANAGEMENT DEFERRED COMPENSATION PLAN - EFFECT OF CHANGE IN CONTROL
The 1986 MDCP allows participants to elect an accelerated distribution of all or a portion of their accounts, which results in a forfeiture of a portion of the distributed amounts. Following a Change of Control, as defined in the plan, only 6% of the distribution is forfeited, rather than the 10% forfeiture normally provided for under the plan. “Change of Control” is defined in the 1986 MDCP as an occurrence in which: (1) a person or entity becomes the beneficial owner of securities representing 30% or more of the voting power of the company’s outstanding voting securities, or (2) during any period of two consecutive years, individuals who at the beginning of the period constituted the board, and any new director whose election by the board or nomination for election by the company’s stockholders was approved by at least two-thirds of the directors in office who either were directors as of the beginning of the period or whose election or nomination was previously so approved, cease to constitute at least a majority of the board.
CASH SEVERANCE BENEFITS
Under the Severance Pay Plan for Executive Employees, executives of the company are eligible for severance pay if they are terminated without cause, or voluntarily terminate employment for good reason and within 90 days of the occurrence that constitutes good reason. If the termination occurs within two years of a change in control, the benefit is equal to 52 weeks of base pay plus the value of the executive’s target annual cash incentive award. If the termination is not within two years of a change of control, the severance benefit is equal to 52 weeks of base pay.
For purposes of the plan, the terms “change in control,” “cause,” and “good reason” have the following meanings:
|
|
•
|
“
Change in control
” means any of the following events:
|
|
|
◦
|
A person or entity becomes the beneficial owner of company securities representing more than 30% of the combined voting power of the company’s then outstanding voting securities;
|
|
|
◦
|
During any period of two consecutive years, individuals who at the beginning of the period constitute the members of the Board of Directors and any new director whose election to the Board of Directors or nomination for election to the Board of Directors by the company’s shareholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority of the Board of Directors;
|
|
|
◦
|
The company merges with or consolidates into any other corporation or entity, other than a merger or consolidation which would result in the holders of the voting securities of the company outstanding immediately prior thereto holding immediately thereafter securities representing more than 50% of the combined voting power of the voting securities of the company or such surviving entity outstanding immediately after such merger or consolidation; or
|
|
|
◦
|
The shareholders of the company approve a plan of complete liquidation of the company or an agreement for the sale or disposition by the company of all or substantially all of the company’s assets.
|
|
|
•
|
“
Good reason
” means the occurrence of any of the following conditions:
|
|
|
◦
|
A material adverse change in the nature of the executive’s duties or responsibilities (provided that merely ceasing to be an officer of a public company does not itself constitute a material adverse change);
|
|
|
◦
|
A material reduction in the executive’s base compensation or incentive compensation opportunities; or
|
|
|
◦
|
A mandatory relocation of the executive’s principal place of work in excess of 50 miles.
|
|
|
•
|
“
Cause
,” in the case of a termination that occurs within two years of a change of control, is defined as conduct involving any of the following:
|
|
|
◦
|
The substantial and continuing failure of the executive to perform substantially all of his or her duties to the company (other than a failure resulting from incapacity due to physical or mental illness), after 30 days’ notice from the company;
|
|
|
◦
|
The violation of a company policy, which could reasonably be expected to result in termination;
|
|
|
◦
|
Dishonesty, gross negligence or breach of fiduciary duty;
|
|
|
◦
|
The commission of an act of fraud or embezzlement, as found by a court of competent jurisdiction;
|
|
|
◦
|
The conviction of a felony; or
|
|
|
◦
|
A material breach of the terms of an agreement with the company, provided that the company provides the executive with adequate notice of the breach and the executive fails to cure the breach with 30 days after receipt of notice.
|
|
|
•
|
“
Cause
,” in the case of a termination that does not occur within two years of a change in control, is defined as a violation of company standards of performance, conduct or attendance (as construed by the company in its sole discretion).
|
ANNUAL CASH INCENTIVE PLAN
Under the terms of the Annual Cash Incentive Plan, if a participant’s employment terminates due to the participant’s death, disability or retirement, the company will pay an award to the participant or the participant’s estate when awards are payable generally to other participants under the plan. The amount of the award will be prorated to reflect the number of full and partial months during the year in which the participant was employed. For the purposes of this provision, “retirement” means a participant’s termination of employment after meeting the requirements for retirement under the company’s pension plan (currently age 55 with five years of service).
Stock Incentive Plan
Compensation Committee Discretion in Event of Change in Control
Under the terms of the Stock Incentive Plan, in the event of a Change in Control (defined below) or a significant change in the business condition or strategy of the company, the Compensation Committee may accelerate distribution of stock awards, provide payment to the participant of cash or other property equal to the fair market value of the award, adjust the terms of the award, cause the award to be assumed, or make such other adjustments to awards as the committee considers equitable to the participant and also in the best interest of the company and its shareholders.
Change in Control Provisions in Performance RSU Awards
Our performance RSU awards for executives provide for accelerated vesting in the event of the executive’s termination following a change in control. Under the terms of the grant agreements, a number of such performance RSUs will vest automatically if, within two years following a change in control: (i) the grantee’s employment is terminated by the company without cause, or (ii) the grantee voluntarily terminates employment for good reason within 90 days after the event constituting good reason. For purposes of the RSU awards, the terms “change in control,” “cause,” and “good reason” have the same definitions as those described above under the heading “Cash Severance Benefits.”
To determine the number of performance RSUs that would vest in the event of a termination following a change in control, the Compensation Committee is required to use a performance percentage calculated in accordance with the terms of the awards, subject to the committee’s right to adjust awards downward, and to the following principles:
|
|
•
|
For the return on equity performance goal, Accounting ROE would be assumed to be actual accounting ROE for any fiscal years that ended prior to the termination of employment, and target ROE for any other fiscal years included in the performance period.
|
|
|
•
|
For the relative total shareholder return goal, target performance results would be assumed for the 3-year performance period.
|
|
|
•
|
For the asset base performance goal, regulated asset base for 3-year performance period would be assumed to be at target. (Note that this performance goal is not used in our 2017 performance RSUs.)
|
The number of dividend equivalent rights would be determined in accordance with the terms of the awards, calculated as if the date of termination were the end of the performance period. See the Compensation Discussion and Analysis section entitled “Long-Term Equity Incentive Awards” for more information about the terms of the 2017 performance RSU awards.
Vesting of Performance RSUs
The restricted stock unit award agreements with the named executive officers provide for early vesting of the performance RSUs in the event an officer’s employment is terminated due to the officer’s death, disability or retirement. The number of units that vest is determined by multiplying the performance percentage by the number of performance RSUs originally granted and by the percentage of the performance period that the officer was actively employed. The remaining performance RSUs are forfeited.
OUTPLACEMENT ASSISTANCE PLAN
The company maintains the Portland General Electric Company Outplacement Assistance Plan to cover the cost of outplacement assistance for certain employees who lose their jobs as a result of corporate, departmental or work group reorganization, including the elimination of a position, or similar business circumstances. Eligible management employees, including officers, are offered the services of an outside outplacement consultant for three to six months, with the exact length of the services determined by the Compensation Committee.
CEO PAY RATIO
In accordance with rules promulgated by the Securities and Exchange Commission (“SEC”) pursuant to provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act, we are disclosing the ratio of the annual total compensation of our chief executive officer to the annual total compensation of the individual we have identified as our median employee for this purpose.
We identified the median employee by examining 2017 taxable earnings, as reported on W-2 forms (“W-2 taxable earnings”), for all individuals who were employed by the Company on December 31, 2017, other than our chief executive officer. We included
all employees, whether employed on a full-time, part-time or seasonal basis, and we did not annualize the compensation of any full-time employee who was employed for less than the full 2017 calendar year. We believe that the use of W-2 taxable earnings is an appropriate measure by which to determine the median employee. After identifying the median employee based on 2017 W-2 taxable earnings, we calculated annual total compensation for such employee using the same methodology that we use for our named executive officers as set forth in the “Totals” column in the 2017 Summary Compensation Table. As measured using that methodology, our chief executive officer’s annual total compensation for 2017 was $3,785,253 and our median employee’s annual total compensation for 2017 was $99,534. As a result, our 2017 chief executive officer to median employee pay ratio was approximately 37:1.
ADDITIONAL INFORMATION
Questions and Answers about the Annual Meeting
Why did I receive a notice in the mail regarding the Internet availability of proxy materials this year instead of a full set of proxy materials?
Pursuant to rules adopted by the Securities and Exchange Commission, we have elected to provide access to our proxy materials on the Internet instead of mailing printed copies of those materials to each shareholder. By doing so, we hope to save costs and reduce the environmental impact of our annual meeting. Accordingly, we are sending a Notice of Internet Availability of Proxy Materials (the “Notice of Internet Availability”) to our shareholders of record and beneficial owners. All shareholders will have the ability to access the proxy materials on a website referred to in the Notice of Internet Availability or request to receive a printed set of the proxy materials at no charge. Instructions on how to access the proxy materials on the Internet or to request a printed copy may be found in the Notice of Internet Availability. In addition, shareholders may request to receive proxy materials in printed form by mail or electronically by email on an ongoing basis by following the instructions on the website referred to in the Notice of Internet Availability.
Why am I receiving these materials?
The Board of Directors has made these materials available to you on the Internet, or, upon your request, will deliver printed versions of these materials to you by mail, in connection with the board’s solicitation of proxies for use at our 2018 Annual Meeting of Shareholders. You are invited to attend the annual meeting and are requested to vote on the proposals described in this proxy statement.
What is included in these materials?
These materials include:
Our proxy statement for the annual meeting; and
Our
2017
Annual Report to Shareholders, which includes our audited financial statements.
If you request printed versions of these materials by mail, these materials will also include the proxy card for the
2018
annual meeting.
How can I get electronic access to the proxy materials?
The Notice of Internet Availability provides you with instructions regarding how to:
View our proxy materials for the annual meeting on the Internet; and
Instruct us to send our future proxy materials to you electronically by email.
Who is entitled to vote at the annual meeting?
Holders of PGE common stock as of the close of business on the record date,
March 1, 2018
, may vote at the annual meeting, either in person or by proxy. As of the close of business on
March 1, 2018
, there were 89,207,820 shares of PGE common stock outstanding and entitled to vote. The common stock is the only authorized voting security of the company, and each share of common stock is entitled to one vote on each matter properly brought before the annual meeting.
What matters will be voted on at the annual meeting?
There are four matters scheduled for a vote at the annual meeting:
|
|
1.
|
The election of directors;
|
|
|
2.
|
The ratification of the appointment of Deloitte & Touche LLP as the company's independent registered public accounting firm for
2018
;
|
|
|
3.
|
An advisory, non-binding vote to approve the compensation of the company's named executive officers; and
|
|
|
4.
|
Approval of the Portland General Electric Company Stock Incentive Plan, as amended and restated.
|
What are the board’s voting recommendations?
The board recommends that you vote your shares in the following manner:
“FOR” the election of each of the company’s nominees for director;
“FOR” the ratification of the appointment of Deloitte & Touche LLP as the company's independent registered public accounting firm for
2018
;
“FOR” the approval of the compensation of the company’s named executive officers; and
“FOR” the approval of the Portland General Electric Company Stock Incentive Plan, as amended and restated.
What is the difference between holding shares as a shareholder of record and as a beneficial owner?
If your shares are registered directly in your name with our transfer agent, American Stock Transfer & Trust Company, or AST, you are considered the “shareholder of record” with respect to those shares.
If your shares are held in a stock brokerage account or by a bank or other nominee, those shares are held in “street name” and you are considered the “beneficial owner” of the shares. As the beneficial owner of those shares, you have the right to direct your broker, bank or other nominee how to vote your shares, and you will receive separate instructions from your broker, bank or other nominee describing how to vote your shares. You also are invited to attend the annual meeting. However, because a beneficial owner is not the shareholder of record, you may not vote these shares in person at the meeting unless you obtain a “legal proxy” from the broker, bank or other nominee that holds your shares, giving you the right to vote the shares at the meeting.
How can I vote my shares before the annual meeting?
If you hold shares in your own name as a shareholder of record, you may vote before the annual meeting online by following the instructions contained in the Notice of Internet Availability. If you request printed copies of the proxy materials by mail, you may also vote by completing, signing and dating the enclosed proxy card and returning it in the enclosed postage-paid envelope.
If you are a beneficial owner of shares held in street name, your broker, bank or other nominee will provide you with materials and instructions for voting your shares.
Even if you plan to attend the annual meeting, we recommend that you vote before the meeting as described above so that your vote will be counted if you later decide not to attend the meeting. Submitting a proxy or voting by telephone or through the Internet will not affect your right to attend the annual meeting and vote in person.
How will my shares be voted if I give my proxy but do not specify how my shares should be voted?
If your shares are held in your own name as a shareholder of record and you return your signed proxy card but do not indicate your voting preferences, your shares will be voted as follows:
“FOR” the election of each of the company's nominees for director;
“FOR” the ratification of the appointment of Deloitte & Touche LLP as the company's independent registered public accounting firm for fiscal year
2018
;
“FOR” the approval of the compensation of the company's named executive officers; and
“FOR” the approval of the Portland General Electric Company Stock Incentive Plan, as amended and restated.
If I am the beneficial owner of shares held in street name by my broker, will my broker automatically vote my shares for me?
New York Stock Exchange rules applicable to broker-dealers grant your broker discretionary authority to vote your shares without receiving your instructions on certain routine matters. Your broker has discretionary authority under the New York Stock Exchange rules to vote your shares on the ratification of the appointment of the independent registered public accounting firm. However, unless you provide voting instructions to your broker, your broker does not have authority to vote your shares with respect to the election of directors, the approval of the compensation of the company’s named executive officers and the approval of the Stock Incentive Plan, as amended and restated. As a result, we strongly encourage you to submit your proxy and exercise your right to vote as a shareholder.
Could other matters be decided at the annual meeting?
As of the date of this proxy statement, we are unaware of any matters, other than those set forth in the Notice of Annual Meeting of Shareholders, that may properly be presented at the annual meeting. If any other matters are properly presented for consideration at the meeting, including, among other things, consideration of a motion to adjourn the meeting to another time or place, the persons named as proxies on the enclosed proxy card, or their duly constituted substitutes, will be deemed authorized to vote those shares for which proxies have been given or otherwise act on such matters in accordance with their judgment.
Can I vote in person at the annual meeting?
Yes. If you hold shares in your own name as a shareholder of record, you may come to the annual meeting and cast your vote at the meeting by properly completing and submitting a ballot. If you are the beneficial owner of shares held in street name, you must first obtain a legal proxy from your broker, bank or other nominee giving you the right to vote those shares and submit that proxy along with a properly completed ballot at the meeting.
What do I need to bring to be admitted to the annual meeting?
All shareholders must present a form of personal photo identification in order to be admitted to the meeting. In addition, if your shares are held in the name of your broker, bank or other nominee and you wish to attend the annual meeting, you must bring an account statement or letter from the broker, bank or other nominee indicating that you were the owner of the shares on
March 1, 2018
.
How can I change or revoke my vote?
If you hold shares in your own name as a shareholder of record, you may change your vote or revoke your proxy at any time before voting begins by:
Notifying our Corporate Secretary in writing that you are revoking your proxy;
Delivering another duly signed proxy that is dated after the proxy you wish to revoke; or
Attending the annual meeting and voting in person by properly completing and submitting a ballot. (Attendance at the meeting, in and of itself, will not cause your previously granted proxy to be revoked unless you vote at the meeting.)
Any written notice of revocation, or later dated proxy, should be delivered to:
Portland General Electric Company
Attention: Corporate Secretary
121 SW Salmon Street, 1WTC1301
Portland, Oregon 97204
Alternatively, you may hand-deliver a written revocation notice, or a later dated proxy, to the Corporate Secretary at the annual meeting before the voting begins.
If you are the beneficial owner of shares held in street name and wish to change your vote with respect to those shares, please check with your broker, bank or other nominee and follow the procedures your broker, bank or other nominee provides you.
What are the voting requirements to elect directors and approve the other proposals described in the proxy statement?
The vote required to approve each of the matters scheduled for a vote at the annual meeting is set forth below:
|
|
|
Proposal
|
Vote Required
|
Election of directors
|
Votes in Favor Exceed Votes Against
|
Ratification of appointment of Deloitte & Touche LLP
|
Votes in Favor Exceed Votes Against
|
Advisory vote on approval of the compensation of the company’s named executive officers
|
Votes in Favor Exceed Votes Against
|
Approval of the Portland General Electric Company Stock Incentive Plan
|
Votes in Favor Exceed Votes Against
|
With respect to the advisory vote to approve the compensation of the company’s named executive officers, if there is any significant vote against this item, the Compensation and Human Resources Committee will consider the concerns of our shareholders and evaluate whether any actions are necessary to address those concerns.
What is the “quorum” for the annual meeting and what happens if a quorum is not present?
The presence at the annual meeting, in person or by proxy, of a majority of the shares issued and outstanding and entitled to vote as of
March 1, 2018
is required to constitute a “quorum.” The existence of a quorum is necessary in order to take action on the matters scheduled for a vote at the annual meeting. If you vote online or by telephone, or submit a properly executed proxy card, your shares will be included for purposes of determining the existence of a quorum. Proxies marked “abstain” and “broker non-votes” (each of which are explained below) also will be counted in determining the presence of a quorum. If the shares present in person or represented by proxy at the annual meeting are not sufficient to constitute a quorum, the chairman of the meeting, or the shareholders by a vote of the holders of a majority of shares present in person or represented by proxy, may, without further notice to any shareholder (unless a new record date is set), adjourn the meeting to a different time and place to permit further solicitations of proxies sufficient to constitute a quorum.
What is an “abstention” and how would it affect the vote?
An “abstention” occurs when a shareholder sends in a proxy with explicit instructions to decline to vote regarding a particular matter. Abstentions are counted as present for purposes of determining a quorum. However, an abstention with respect to a matter submitted to a vote of shareholders will not be counted for or against the matter. Consequently, an abstention with respect to any of the proposals at the annual meeting will not affect the outcome of the vote.
What is a “broker non-vote” and how would it affect the vote?
A broker non-vote occurs when a broker or other nominee who holds shares for another person does not vote on a particular proposal because that holder does not have discretionary voting power for the proposal and has not received voting instructions from the beneficial owner of the shares. Brokers will have discretionary voting power to vote shares for which no voting instructions have been provided by the beneficial owner with respect to the ratification of the appointment of the independent registered public accounting firm, but not with respect to the other proposals. Accordingly, there might be broker non-votes with respect to the election of directors, the advisory vote to approve the compensation of the company’s named executive officers and the approval of the Stock Incentive Plan, as amended and restated. A broker non-vote will have the same effect as an abstention and, therefore, will not affect the outcome of the vote with respect to any of the proposals at the annual meeting.
Who will conduct the proxy solicitation and how much will it cost?
The company is soliciting your proxy for the annual meeting and will pay all the costs of the proxy solicitation process. We have engaged Broadridge Financial Solutions, Inc. to assist in the distribution of proxy materials, and we will pay their reasonable out-of-pocket expenses for those services. Our directors, officers and employees may communicate with shareholders by telephone, facsimile, email or personal contact to solicit proxies. These individuals will not be specifically compensated for doing so. We will reimburse brokerage houses and other custodians, nominees and fiduciaries for their reasonable out-of-pocket expenses for forwarding solicitation materials to the beneficial owners of PGE common stock.
Who will count the votes?
Broadridge Financial Solutions, Inc. will tabulate the votes cast by mail, Internet, or telephone. Nora E. Arkonovich, our Assistant Secretary, will tabulate any votes cast at the annual meeting and will act as inspector of election to certify the results.
If you have any questions about voting your shares or attending the annual meeting, please call our Investor Relations Department at (503) 464-8586.
Shareholder Proposals for the 2019 Annual Meeting
We plan to hold our
2019
annual meeting of shareholders on April 24,
2019
. If you wish to submit a proposal to be considered for inclusion in our proxy materials for the 2019 annual meeting of shareholders, the proposal must be in proper form as required by Rule 14a-8 under the Securities Exchange Act of 1934, and our Corporate Secretary must receive the proposal by November 14,
2018
. In addition, under our bylaws, in order for a proposal outside of Rule 14a-8 to be considered “timely” within the meaning of Rule 14a-4(c) of the Securities Exchange Act of 1934, such proposal must be received at our principal executive offices by December 26, 2018. After November 14,
2018
, and up to December 26, 2018, a shareholder may submit a proposal to be presented at the 2019 annual meeting, but it will not be included in our proxy statement or form of proxy relating to the meeting.
Shareholder proposals should be addressed to Portland General Electric Company, Attention: Corporate Secretary, 121 SW Salmon Street, 1WTC1301, Portland, Oregon 97204. We recommend that shareholders submitting proposals use certified mail, return receipt requested, in order to provide proof of timely receipt. We reserve the right to reject, rule out of order, or take other appropriate action with respect to any proposal that does not comply with these and other applicable requirements, including the rules established by the Securities and Exchange Commission.
Communications with the Board of Directors
Shareholders and other interested parties may submit written communications to members of the Board of Directors (including the Chairman), board committees, or the non-management directors as a group. Communications may include the reporting of concerns related to governance, corporate conduct, business ethics, financial practices, legal issues and accounting or audit matters. Communications should be in writing and addressed to the Board of Directors, or any individual director or group or committee of directors by either name or title, and should be sent in care of:
Portland General Electric Company
Attention: Corporate Secretary
121 SW Salmon Street, 1WTC1301
Portland, Oregon 97204
All appropriate communications received from shareholders and other interested parties will be forwarded to the Board of Directors, or the specified director, board committee or group of directors, as appropriate.
APPENDIX A
PORTLAND GENERAL ELECTRIC COMPANY
STOCK INCENTIVE PLAN
Originally Effective March 31, 2006
(As Amended and Restated Effective February 13, 2018)
1.
Purpose
.
The Portland General Electric Company Stock Incentive Plan, as amended and restated (the “
Plan
”), is intended to provide incentives which will attract, retain and motivate highly competent persons as officers, directors and key employees of Portland General Electric Company (the “
Company
”) and its subsidiaries and Affiliates, by providing them with appropriate incentives and rewards in the form of rights to earn shares of the common stock of the Company (“
Common Stock
”) and cash equivalents.
2.
Definitions
. A listing of the defined terms utilized in the Plan is set forth in Appendix A.
3.
Effective Date of Plan
. The Plan was originally effective as of March 31, 2006, and was most recently amended and restated effective February 13, 2018.
4.
Administration
.
(a)
Committee
.
The Plan will be administered by a committee (the “
Committee
”) appointed by the Board of Directors of the Company (the “
Board of Directors
”) from among its members (which may be the Compensation and Human Resources Committee) and shall be comprised, solely of not less than two (2) members who shall be (i) “non-employee directors” within the meaning of Rule 16b-3(b)(3) (or any successor rule) promulgated under the Securities Exchange Act of 1934, as amended (the “
Exchange Act
”), (ii) in respect of any “Grandfathered Awards” (as defined in Section 13), “outside directors” within the meaning of Treasury Regulation Section 1.162-27(e)(3) under Section 162(m) of the Internal Revenue Code of 1986, as amended (the “
Code
”), and (iii) to the extent the Board of Directors may direct in respect of Awards granted to the Chief Executive Officer and determining amounts payable under such Awards, non-employee directors who satisfy the standards of the New York Stock Exchange (the “
NYSE
”) and other applicable standards for an independent director.
(b)
Authority
. The Committee is authorized, subject to the provisions of the Plan, to establish such rules and regulations as it deems necessary for the proper administration of the Plan and, in its sole discretion, to make such determinations, valuations and interpretations and to take such action in connection with the Plan and any Awards (as hereinafter defined) granted hereunder as it deems necessary or advisable. All determinations and interpretations made by the Committee shall be binding and conclusive on all participants and their legal representatives.
(c)
Indemnification
. No member of the Committee and no employee of the Company shall be liable for any act or failure to act hereunder, or for any act or failure to act hereunder by any other member or employee or by any agent to whom duties in connection with the administration of this Plan have been delegated, except in circumstances involving his or her bad faith or willful misconduct. The Company
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shall indemnify members of the Committee and any agent of the Committee who is an employee of the Company, or of a subsidiary or an Affiliate against any and all liabilities or expenses to which they may be subjected by reason of any act or failure to act with respect to their duties on behalf of the Plan, except in circumstances involving such person’s bad faith or willful misconduct. For purposes of this Plan, “
Affiliate(s)
” means any entity that controls, is controlled by or is under common control with the Company.
(d)
Delegation and Advisers
. The Committee may delegate to one or more of its members, or to one or more employees or agents, such duties and authorities as it may deem advisable including the authority to make grants as permitted by applicable law, the rules of the Securities and Exchange Commission and any requirements of the NYSE, and the Committee, or any person to whom it has delegated duties or authorities as aforesaid, may employ one or more persons to render advice with respect to any responsibility the Committee or such person may have under the Plan. The Committee may employ such legal or other counsel, consultants and agents as it may deem desirable for the administration of the Plan and may rely upon any opinion or computation received from any such counsel, consultant or agent. Expenses incurred by the Committee in the engagement of such counsel, consultant or agent shall be paid by the Company, or the subsidiary or Affiliate whose employees have benefited from the Plan, as determined by the Committee.
5.
Type of Awards
.
Awards under the Plan may be granted in any one or a combination of (a) Stock Options, (b) Stock Appreciation Rights, (c) Restricted Stock Awards, and (d) Stock Units (each as described below, and collectively, the “
Awards
”). Grandfathered Awards may, as determined by the Committee in its discretion, constitute Performance-Based Awards, as described in Section 13 hereof.
6.
Participants
.
Participants will consist of (i) such officers and key employees of the Company and its subsidiaries and Affiliates as the Committee in its sole discretion determines to be significantly responsible for the success and future growth and profitability of the Company and whom the Committee may designate from time to time to receive Awards under the Plan and (ii) each director of the Company who is not otherwise an employee of the Company or any of its subsidiaries and whom the Committee may designate from time to time to receive Awards under the Plan. Designation of a participant in any year shall not require the Committee to designate such person to receive an Award in any other year or, once designated, to receive the same type or amount of Award as granted to the participant in any other year. The Committee shall consider such factors as it deems pertinent in selecting participants and in determining the type and amount of their respective Awards.
7.
Grant Agreements
.
(a)
Awards granted under the Plan shall be evidenced by an agreement (“
Grant Agreement
”) that shall provide such terms and conditions, as determined by the Committee in its sole discretion, provided, however, that in the event of any conflict between the provisions of the Plan and any such Grant Agreement, the provisions of the Plan shall prevail.
(b)
The Grant Agreement will determine the effect on an Award of the disability, death, retirement, involuntary termination, termination for cause or other termination of employment or service of a participant and the extent to which, and the period during which, the participant’s legal representative, guardian or beneficiary may receive payment of an Award or exercise rights thereunder. If the relevant Grant Agreement does not provide otherwise, however, the following default rules shall apply:
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(i)
vested Stock Option and Stock Appreciation Rights held by a participant shall be exercisable for a period of 90 days following the date the participant ceases to be an employee or director of the Company, its subsidiaries and Affiliates;
(ii)
unvested Stock Option, Stock Appreciation Rights, Restricted Stock Awards and Stock Units held by a participant shall be forfeited on the date the participant ceases to be an employee or director of the Company, its subsidiaries and Affiliates.
(c)
Subject to Section 13(e), the Committee, in its sole discretion, may modify a Grant Agreement, provided any such modification will not materially adversely affect the economic interests of the participant unless the Committee shall have obtained the written consent of the participant. Subject to Section 15, the Committee shall not have the authority to reprice or cancel and regrant any Award at a lower exercise, base or purchase price or cancel any Award with an exercise, base or purchase price of less than “Fair Market Value” (as defined in Section 8(g)) in exchange for cash, property or other Awards without first obtaining the approval of the Company’s shareholders.
(d)
Notwithstanding any provision of the Plan or a Grant Agreement to the contrary, no dividends will be payable with respect to a share of Common Stock underlying an Award unless and until the Award vests in respect of such share of Common Stock.
(e)
Grant Agreements under the Plan need not be identical.
8.
Stock Options
.
(a)
Generally
. At any time, the Committee may grant, in its discretion, awards of stock options that will enable the holder to purchase a number of shares of Common Stock from the Company, at set terms (a “
Stock Option
”). Stock Options may be incentive stock options (“
Incentive Stock Options
”), within the meaning of Section 422 of the Code, or Stock Options which do not constitute Incentive Stock Options (“
Nonqualified Stock Options
”). The Committee will have the authority to grant to any participant one or more Incentive Stock Options and/or Nonqualified Stock Options. Each Stock Option shall be subject to such terms and conditions, including vesting, consistent with the Plan as the Committee may provide in the Grant Agreement, subject to the following limitations:
(b)
Exercise Price
. Each Stock Option granted hereunder shall have such per-share exercise price as the Committee may determine in the Grant Agreement, but such exercise price may not be less than
“
Fair Market Value
”
on the date the Stock Option is granted, except as provided in Section 11(c).
(c)
Payment of Exercise Price
. The option exercise price may be paid in cash or, in the discretion of the Committee and in accordance with any requirements established by the Committee, by the delivery of shares of Common Stock of the Company then owned by the participant. In the discretion of the Committee and in accordance with any requirements established by the Committee, payment may also be made by (i) delivering a properly executed exercise notice to the Company together with a copy of irrevocable instructions to a broker to deliver promptly to the Company the amount of sale or loan proceeds to pay the exercise price or (ii) by means of consideration received under any cashless exercise procedure approved by the Committee (including the withholding of shares of Common Stock otherwise issuable upon exercise).
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(d)
Exercise Period
. Stock Options granted under the Plan shall be exercisable at such time or times and subject to such terms and conditions, including vesting, as shall be determined by the Committee in the Grant Agreement.
(e)
Limitations on Incentive Stock Options
. Incentive Stock Options may be granted only to participants who are employees of the Company or of a “
Parent Corporation
” or “
Subsidiary Corporation
” (as defined in Sections 424(e) and (f) of the Code, respectively) at the date of grant. The aggregate Fair Market Value (determined as of the time the Stock Option is granted in accordance with Section 8(g)) of the Common Stock with respect to which Incentive Stock Options are exercisable for the first time by a participant during any calendar year (under all option plans of the Company and of any Parent Corporation or Subsidiary Corporation) shall not exceed one hundred thousand dollars ($100,000). For purposes of the preceding sentence, Incentive Stock Options will be taken into account in the order in which they are granted. The per-share exercise price of an Incentive Stock Option shall not be less than one hundred percent (100%) of the Fair Market Value of the Common Stock on the date of grant, and no Incentive Stock Option may be exercised later than ten (10) years after the date it is granted.
(f)
Additional Limitations on Incentive Stock Options for Ten Percent Shareholders
. Incentive Stock Options may not be granted to any participant who, at the time of grant, owns stock possessing (after the application of the attribution rules of Section 424(d) of the Code) more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any Parent Corporation or Subsidiary Corporation, unless the exercise price of the option is fixed at not less than one hundred ten percent (110%) of the Fair Market Value of the Common Stock on the date of grant and the exercise of such option is prohibited by its terms after the expiration of five (5) years from the date of grant of such option.
(g)
Fair Market Value
. For purposes of this Plan and any Awards granted hereunder, “
Fair Market Value
” shall be the closing price of the Common Stock on the relevant date (or on the last preceding trading date if Common Stock was not traded on such date) if the Common Stock is readily tradable on a national securities exchange or other market system, and if the Common Stock is not readily tradable, Fair Market Value shall mean the amount determined in good faith by the Committee as the fair market value of the Common Stock.
9.
Stock Appreciation Rights
.
(a)
Generally
. At any time, the Committee may, in its discretion, grant stock appreciation rights with respect to Common Stock (“
Stock Appreciation Rights
”), including a concurrent grant of Stock Appreciation Rights in tandem with any Stock Option grant. A Stock Appreciation Right means a right to receive a payment in cash or in Common Stock of an amount equal to the excess of (i) the Fair Market Value of a share of Common Stock on the date the right is exercised over (ii) the Fair Market Value of a share of Common Stock on the date the right is granted, all as determined by the Committee. Each Stock Appreciation Right shall be subject to such terms and conditions, including vesting, as the Committee shall impose in the Grant Agreement.
(b)
Exercise Period
. Stock Appreciation Rights granted under the Plan shall be exercisable at such time or times and subject to such terms and conditions, including vesting, as shall be determined by the Committee in the Grant Agreement.
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10.
Restricted Stock Awards
.
(a)
Generally
. At any time, the Committee may, in its discretion, grant Awards of Common Stock, subject to restrictions determined by the Committee (a “
Restricted Stock Award
”). Such Awards may include mandatory payment of any bonus in stock consisting of Common Stock issued or transferred to participants with or without other payments therefor and may be made in consideration of services rendered to the Company or its subsidiaries or Affiliates. A Restricted Stock Award shall be construed as an offer by the Company to the participant to purchase the number of shares of Common Stock subject to the Restricted Stock Award at the purchase price, if any, established therefore.
(b)
Payment of the Purchase Price
. If the Restricted Stock Award requires payment therefor, the purchase price of any shares of Common Stock subject to a Restricted Stock Award may be paid in any manner authorized by the Committee, which may include any manner authorized under the Plan for the payment of the exercise price of a Stock Option.
(c)
Restrictions
. Restricted Stock Awards shall be subject to such terms and conditions, including without limitation time based vesting and/or performance based vesting, restrictions on the sale or other disposition of such shares, and/or the right of the Company to reacquire such shares for no consideration upon termination of the participant’s employment within specified periods, as the Committee determines appropriate. The Committee may require the participant to deliver a duly signed stock power, endorsed in blank, relating to the Common Stock covered by such an Award. The Committee may also require that the stock certificates evidencing such shares be held in custody or bear restrictive legends until the restrictions thereon shall have lapsed.
(d)
Rights as a Shareholder
. The Restricted Stock Award shall specify whether the participant shall have, with respect to the shares of Common Stock subject to a Restricted Stock Award, all of the rights of a holder of shares of Common Stock of the Company, including the right to accrue dividends and to vote the shares.
11.
Common Stock Available Under the Plan
.
(a)
Basic Limitations
. The aggregate number of shares of Common Stock that may be subject to Awards over the entire term of the Plan since its original effective date (subject to the remainder of this Section 11 and to Section 15) shall be 4,687,500, subject to any adjustments made in accordance with Section 15 hereof. The maximum number of shares of Common Stock that may be:
(i)
the subject of an Award with respect to any individual participant under the Plan during the term of the Plan shall not exceed 2,000,000 (subject to adjustments made in accordance with Section 15 hereof);
(ii)
covered by Awards issued under the Plan during a year shall be limited during the first calendar year of the Plan to 1,250,000 and during any year thereafter to 1% of the Company’s outstanding Common Stock at the beginning such year; and
(iii)
issued pursuant to Incentive Stock Options awarded under the Plan shall be 1,000,000.
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Shares of Common Stock issued under the Plan may, in whole or in part, be authorized but unissued shares or shares held in treasury that shall have been or may be reacquired by the Company in the open market, in private transactions or otherwise.
(b)
Additional Shares
. Any shares of Common Stock subject to a Stock Option or Stock Appreciation Right which for any reason is cancelled or terminated without having been exercised and any shares of Common Stock subject to Restricted Stock Awards or Stock Units which are forfeited shall again be available for Awards under the Plan. The preceding sentence shall apply only for purposes of determining the aggregate number of shares of Common Stock subject to Awards but shall not apply for purposes of determining the maximum number of shares of Common Stock with respect to which Awards may be granted to any individual participant under the Plan. Notwithstanding any provision of the Plan or a Grant Agreement to the contrary, shares of Common Stock that are exchanged by a Participant or withheld by the Company as full or partial payment in connection with any Stock Option or Stock Appreciation Right under the Plan, as well as any shares of Common Stock exchanged by a Participant or withheld by the Company or any Subsidiary Corporation to satisfy the tax withholding obligations related to any Award, shall not be available for subsequent Awards under the Plan, and notwithstanding that a Stock Appreciation Right may be settled by the delivery of a net number of shares of Common Stock, the full number of shares of Common Stock underlying such Stock Appreciation Right shall not be available for subsequent Awards under the Plan.
(c)
Acquisitions
. In connection with the acquisition of any business by the Company or any of its subsidiaries or Affiliates, any outstanding grants or awards of options, restricted stock or other equity-based compensation pertaining to such business may be assumed or replaced by Awards under the Plan upon such terms and conditions as the Committee determines, including granting of Stock Options or Stock Appreciation Rights with an exercise price below Fair Market Value at the date of the replacement grant.
12.
Stock Units
.
(a)
Generally
. The Committee may, in its discretion, grant “Stock Units” (as defined in Section 12(c)) to participants hereunder. Stock Units may be subject to such terms and conditions, including time based vesting and/or performance based vesting, as the Committee determines appropriate. A Stock Unit granted by the Committee shall provide payment in shares of Common Stock at such time as the Grant Agreement shall specify. Shares of Common Stock issued pursuant to this Section 12 may be issued with or without other payments therefor as may be required by applicable law or such other consideration as may be determined by the Committee. The Committee shall determine whether a participant granted a Stock Unit shall be entitled to a Dividend Equivalent Right (as defined in Section 12(c)).
(b)
Settlement of Stock Units
. Shares of Common Stock representing the Stock Units shall be distributed to the participant upon settlement of the Award pursuant to the Grant Agreement.
(c)
Definitions
. A “
Stock Unit
” means a notional account representing one (1) share of Common Stock. A “
Dividend Equivalent Right
” means the right to receive the amount of any dividend paid on the share of Common Stock underlying a Stock Unit, which shall be payable in cash or in the form of additional Stock Units, in the discretion of the Committee.
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13.
Performance-Based Awards
.
(a)
Generally
. In the sole discretion of the Committee, any “Grandfathered Awards” granted under the Plan may be administered in a manner such that the Award qualifies for the performance-based compensation exemption of Section 162(m) of the Code (each, a “
Performance-Based Award
”). Notwithstanding any other provision of the Plan and except as determined by the Committee, any Grandfathered Award which is intended to qualify as a Performance-Based Award shall be subject to any additional limitations imposed under Section 162(m) of the Code that are requirements for qualification as a Grandfathered Award, and the Plan and Grant Agreement shall be deemed amended to the extent necessary to confirm to such requirements. A “
Grandfathered Award
” means an Award which is provided pursuant to a written binding contract in effect on November 2, 2017, and which was not modified in any material respect on or after November 2, 2017, within the meaning of Section 13601(e)(2) of P.L. 115.97, as may be amended from time to time (including any rules and regulations promulgated thereunder).
(b)
Modification of Performance-Based Awards
. Subject to Section 15(b), with respect to any Performance-Based Awards, the Committee shall not revise any performance goal thereunder or increase the amount of compensation payable thereunder upon the attainment of such performance goal (in accordance with the requirements of Section 162(m) of the Code and the regulations thereunder). Notwithstanding the preceding sentence, (i) the Committee may reduce or eliminate the number of shares of Common Stock or cash granted or the number of shares of Common Stock vested upon the attainment of such performance goal, and (ii) the Committee shall disregard or offset the effect of “Extraordinary Items” in determining the attainment of performance goals. For this purpose, “Extraordinary Items” means extraordinary, unusual and/or non-recurring items, including but not limited to, (i) regulatory disallowances or other adjustments, (ii) restructuring or restructuring-related charges, (iii) gains or losses on the disposition of a business or major asset, (iv) changes in regulatory, tax or accounting regulations or laws, (v) resolution and/or settlement of litigation and other legal proceedings or (vi) the effect of a merger or acquisition.
14.
Foreign Laws
. The Committee may grant Awards to individual participants who are subject to the tax laws of nations other than the United States, which Awards may have terms and conditions as determined by the Committee as necessary to comply with applicable foreign laws. The Committee may take any action which it deems advisable to obtain approval of such Awards by the appropriate foreign governmental entity;
provided, however,
that no such Awards may be granted pursuant to this Section 14 and no action may be taken which would result in a violation of the Exchange Act, the Code or any other applicable law.
15.
Adjustment Provisions
.
(a)
Adjustment Generally
. If there shall be any change in the Common Stock of the Company, through merger, consolidation, reorganization, recapitalization, stock dividend, stock split, reverse stock split, split up, spin-off, combination of shares, exchange of shares, dividends or other changes in capital structure, an adjustment shall be made as provided below in (b) to each outstanding Award.
(b)
Modification of Awards
. In the event of any change or distribution described in subsection (a) above, the Committee shall appropriately adjust the number of shares of Common Stock
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which may be issued pursuant to the Plan, the other limits on Common Stock issuable under the Plan under Section 11, and the number of shares covered by, and the exercise price of, each outstanding Award.
(c)
Notwithstanding the above, no adjustment to a Stock Option or Stock Appreciation Right shall be made under this Section 15 in a manner that will be treated under Section 409A of the Code as the grant of a new Stock Option or Stock Appreciation Right.
16.
Nontransferability, Title and Other Restrictions
. Except as otherwise specifically provided by the Committee in a Grant Agreement or modification of a Grant Agreement that provides for transfer, each Award granted under the Plan to a participant shall not be transferable otherwise than by will or the laws of descent and distribution, and shall be exercisable, during the participant’s lifetime, only by the participant. In the event of the death of a participant, each Award granted to him or her shall be exercisable during such period after his or her death as the Committee shall in its discretion set forth in the Grant Agreement at the date of grant and then only by the executor or administrator of the estate of the deceased participant or the person or persons to whom the deceased participant’s rights under the Stock Option or Stock Appreciation Right shall pass by will or the laws of descent and distribution.
17.
Acceleration of Awards
.
(a)
In order to preserve a participant’s rights under an Award in the event of a Change in Control of the Company or in the event of a fundamental change in the business condition or strategy of the Company, the Committee, in its sole discretion, may, at the time an Award is made or at any time thereafter, take one or more of the following actions: (i) provide for the acceleration of any time period relating to the exercise or payment of the Award, (ii) provide for payment to the participant of cash or other property with a fair market value equal to the amount that would have been received upon the exercise or payment of the Award had the Award been exercised or paid upon such event, (iii) adjust the terms of the Award in a manner determined by the Committee to reflect such event, (iv) cause the Award to be assumed, or new rights substituted therefor, by another entity, or (v) make such other adjustments in the Award as the Committee may consider equitable to the participant and in the best interests of the Company. Further, any Award shall be subject to such conditions as necessary to comply with federal and state securities laws, the performance based exception of Section 162(m) of the Code, or understandings or conditions as to the participant’s employment in addition to those specifically provided for under the Plan.
(b)
A “
Change in Control
” shall mean any of the following events:
(i)
Any person (as such term is used in Section 14(d) of the Exchange Act) becomes the “beneficial owner” (as determined pursuant to Rule 14d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing more than thirty percent (30%) of the combined voting power of the Company’s then outstanding voting securities; or
(ii)
During any period of two (2) consecutive years (not including any period prior to the execution of this Plan), individuals who at the beginning of such period constitute the members of the Board of Directors and any new director whose election to the Board of Directors or nomination for election to the Board of Directors by the Company’s stockholders was approved
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by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority of the Board of Directors; or
(iii)
The Company shall merge with or consolidate into any other corporation or entity, other than a merger or consolidation which would result in the holders of the voting securities of the Company outstanding immediately prior thereto holding immediately thereafter securities representing more than fifty percent (50%) of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation; or
(iv)
The stockholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets.
Notwithstanding the foregoing, a Change in Control shall not be deemed to have occurred by virtue of the consummation of any transaction or series of integrated transactions immediately following which the holders of Common Stock immediately prior to such transaction or series of transactions continue to have substantially the same proportionate ownership in an entity which owns all or substantially all of the assets of the Company immediately following such transaction or series of transactions.
(c)
If all or a portion of an Award constitutes deferred compensation under Section 409A of the Code and such Award (or portion thereof) is to be settled, distributed or paid on an accelerated basis due to a Change in Control event that is not a "change in control event" described in Treasury Regulation Section 1.409A-3(i)(5) or successor guidance, if such settlement, distribution or payment would result in additional tax under Section 409A of the Code, such Award (or the portion thereof) shall vest at the time of the Change in Control (provided such accelerated vesting will not result in additional tax under Section 409A of the Code), but settlement, distribution or payment, as the case may be, shall not be accelerated.
18.
Withholding
. All payments or distributions of Awards made pursuant to the Plan shall be net of any amounts required to be withheld pursuant to applicable federal, state and local tax withholding requirements. If the Company proposes or is required to distribute Common Stock pursuant to the Plan, it may require the recipient to remit to it or to the corporation or entity that employs such recipient an amount sufficient to satisfy such tax withholding requirements prior to the delivery of any certificates for such Common Stock. In lieu thereof, the Company or the employing corporation or entity shall have the right to withhold the amount of such taxes from any other sums due or to become due from such corporation to the recipient as the Committee shall prescribe. The Committee may, in its discretion and subject to such rules as it may adopt (including any as may be required to satisfy applicable tax and/or non-tax regulatory requirements), permit an optionee or award or right holder to pay all or a portion of the federal, state and local withholding taxes arising in connection with any Award consisting of shares of Common Stock by electing to have the Company withhold shares of Common Stock having a Fair Market Value equal to the applicable amount of tax to be withheld.
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19.
Employment
. A participant’s right, if any, to continue to serve the Company or any of its subsidiaries or Affiliates as a director, officer, employee, or otherwise, shall not be enlarged or otherwise affected by his or her designation as a participant under the Plan.
20.
Unfunded Plan
. Participants shall have no right, title, or interest whatsoever in or to any investments which the Company may make to aid it in meeting its obligations under the Plan. Nothing contained in the Plan, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind, or a fiduciary relationship between the Company and any participant, beneficiary, legal representative or any other person. To the extent that any person acquires a right to receive payments from the Company under the Plan, such right shall be no greater than the right of an unsecured general creditor of the Company. All payments to be made hereunder shall be paid from the general funds of the Company and no special or separate fund shall be established and no segregation of assets shall be made to assure payment of such amounts except as expressly set forth in the Plan. The Plan is not intended to be subject to the Employee Retirement Income Security Act of 1974, as amended.
21.
No Fractional Shares
. No fractional shares of Common Stock shall be issued or delivered pursuant to the Plan or any Award. The Committee shall determine whether cash, or Awards, or other property shall be issued or paid in lieu of fractional shares or whether such fractional shares or any rights thereto shall be forfeited or otherwise eliminated.
22.
Duration, Amendment and Termination
. The Plan shall terminate on March 31, 2024, but all outstanding Awards as of the date of termination shall remain in effect and the terms of the Plan shall apply until each such Award terminates as provided in the applicable Grant Agreement. The Committee may amend the Plan from time to time or suspend or terminate the Plan at any time. No amendment of the Plan may be made without approval of the stockholders of the Company if such approval is required under the Code, the rules of a stock exchange, or any other applicable laws or regulations.
23.
Award Deferrals
. Participants may elect to defer receipt of shares of Common Stock or amounts payable under an Award in accordance with procedures established by the Committee.
24.
Section 409A of the Code
. The Plan as well as payments and benefits under the Plan are intended to be exempt from or, to the extent subject thereto, to comply with, Section 409A of the Code, and, accordingly, to the maximum extent permitted, the Plan shall be interpreted in accordance therewith. Notwithstanding anything contained herein to the contrary, to the extent required in order to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, a Participant shall not be considered to have terminated employment or service with the Company for purposes of the Plan and no payment shall be due to the Participant under the Plan or any Award until the Participant would be considered to have incurred a “separation from service” from the Company and its Affiliates within the meaning of Section 409A of the Code. Any payments described in the Plan that are due within the “short term deferral period” as defined in Section 409A of the Code shall not be treated as deferred compensation unless applicable law requires otherwise. Notwithstanding anything to the contrary in the Plan, to the extent that any Awards (or any other amounts payable under any plan, program or arrangement of the Company or any of its Affiliates) are payable upon a separation from service and such payment would result in the imposition of any individual tax and penalty interest charges imposed under Section 409A of the Code, the settlement and payment of such awards (or other amounts) shall instead be made on the first business day after the date that is six (6) months following such separation from service (or death, if
A-10
earlier). Each amount to be paid or benefit to be provided under this Plan shall be construed as a separate identified payment for purposes of Section 409A of the Code. The Company makes no representation that any or all of the payments or benefits described in this Plan will be exempt from or comply with Section 409A of the Code and makes no undertaking to preclude Section 409A of the Code from applying to any such payment. Each Participant shall be solely responsible for the payment of any taxes and penalties incurred under Section 409A of the Code.
25.
Compliance with Securities Laws
. Notwithstanding any other provision of the Plan, the Company shall have no liability to deliver any shares of Common Stock under the Plan or make any other distribution of benefits under the Plan unless such delivery or distribution would comply with all applicable laws (including, without limitation, the requirements of the Securities Act of 1933), and the applicable requirements of any securities exchange or similar entity.
26.
Certain Additional Considerations
.
(a)
In the event that the Company establishes, for itself or using the services of a third party, an automated system for the documentation, granting or exercise of Awards, such as a system using an internet website or interactive voice response, then the paperless documentation, granting or exercise of Awards by a participant may be permitted through the use of such an automated system.
(b)
If any provision of the Plan is held to be invalid or unenforceable, the other provisions of the Plan shall not be affected but shall be applied as if the invalid or unenforceable provision had not been included in the Plan.
(c)
Notwithstanding any other provisions in this Plan, any Award which is subject to recovery under any law, government regulation, stock exchange listing requirement or Grant Agreement or Company policy, will be subject to such deductions and clawback as may be required to be made pursuant to such law, government regulation or stock exchange listing requirement (or any Grant Agreement or policy adopted by the Company pursuant to any such law, government regulation, stock exchange listing requirement or otherwise).
27.
Governing Law
. This Plan, Awards granted hereunder and actions taken in connection herewith shall be governed and construed in accordance with the laws of the state of Oregon.
Executed as of the 13
th
day of February, 2018.
PORTLAND GENERAL ELECTRIC COMPANY
By:
/s/ Anne F. Mersereau
Name:
Anne F. Mersereau
Title: Vice President, Human Resources, Diversity
and Inclusion
A-11
Appendix A
Index of Defined Terms
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Term
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Section
Where Defined
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Affiliate(s)
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4(c)
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Awards
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5
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Board of Directors
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4(a)
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Change in Control
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17(b)
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Code
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4(a)
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Committee
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4(a)
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Common Stock
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1
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Company
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1
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Dividend Equivalent Right
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12(c)
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Exchange Act
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4(a)
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Fair Market Value
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8(g)
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Grandfathered Award
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13(a)
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Grant Agreement
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7(a)
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Incentive Stock Options
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8(a)
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Nonqualified Stock Options
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8(a)
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Parent Corporation
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8(e)
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Performance-Based Award
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13
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Plan
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1
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Restricted Stock Award
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10(a)
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Stock Appreciation Rights
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9(a)
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Stock Option
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8(a)
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Stock Unit
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12(c)
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Subsidiary Corporation
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8(e)
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A-12
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VOTE BY INTERNET -
www.proxyvote.com
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PORTLAND GENERAL ELECTRIC COMPANY
ATTN: CHRISTOPHER A. LIDDLE
121 SW SALMON STREET 1WTC0509
PORTLAND, OR 97204
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Use the Internet to transmit your voting instructions and for electronic delivery of information until 11:59 P.M. Eastern Time the day before the meeting date. Have your proxy card in hand when you access the website and follow the instructions to obtain your records and to create an electronic voting instruction form.
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ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS
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If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via email or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years.
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VOTE BY PHONE - 1-800-690-6903
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Use any touch-tone telephone to transmit your voting instructions until 11:59 P.M. Eastern Time the day before the meeting date. Have your proxy card in hand when you call and then follow the instructions.
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VOTE BY MAIL
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Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.
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TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
M31772-P05687
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KEEP THIS PORTION FOR YOUR RECORDS
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DETACH AND RETURN THIS PORTION ONLY
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THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
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PORTLAND GENERAL ELECTRIC COMPANY
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Vote on Directors
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The Board of Directors recommends a vote “FOR” each director nominee:
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1
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Election of Directors
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Nominees:
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For
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Against
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Abstain
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Vote On Proposals
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For
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Against
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Abstain
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1a.
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John W. Ballantine
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o
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o
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o
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1b.
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Rodney L. Brown, Jr.
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o
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o
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o
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The Board of Directors recommends a vote “FOR” the following proposals:
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1c.
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Jack E. Davis
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o
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o
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o
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1d.
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David A. Dietzler
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o
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o
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o
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2
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To ratify the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for fiscal year 2018.
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o
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o
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o
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1e.
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Kirby A. Dyess
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o
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o
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o
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1f.
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Mark B. Ganz
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o
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o
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o
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1g.
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Kathryn J. Jackson
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o
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o
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o
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3
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To approve, by a non-binding vote, the compensation of the Company’s named executive officers.
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o
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o
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o
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1h.
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Neil J. Nelson
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o
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o
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o
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1i.
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M. Lee Pelton
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o
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o
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o
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1j.
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Maria M. Pope
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o
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o
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o
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4
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To approve the Portland General Electric Company Stock Incentive Plan, as amended and restated.
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o
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o
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o
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1k.
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Charles W. Shivery
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o
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o
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o
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For address changes and/or comments, please check this box and write them on the back where indicated.
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o
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Please indicate if you plan to attend this meeting.
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o
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o
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Yes
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No
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Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer.
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Signature [PLEASE SIGN WITHIN BOX]
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Signature (Joint Owners)
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Date
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Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The Notice & Proxy Statement and Annual Report are available at www.proxyvote.com or
investors.portlandgeneral.com.
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PORTLAND GENERAL ELECTRIC COMPANY
Annual Meeting of Shareholders
April 25, 2018, 10:00 a.m. local time
This proxy is solicited on behalf of the Board of Directors
The Portland General Electric Company 2018 Annual Meeting of Shareholders will be held on Wednesday, April 25, 2018, at 10:00 a.m. local time, at the Conference Center Auditorium located at Two World Trade Center, 25 SW Salmon Street, Portland, OR 97204.
The undersigned, having received the Notice and accompanying Proxy Statement for said meeting, hereby constitutes and appoints Jack E. Davis, Maria M. Pope, James F. Lobdell, and Lisa A. Kaner, or any of them, his/her true and lawful agents and proxies, with power of substitution and resubstitution in each, to represent and vote all the shares of Common Stock of Portland General Electric Company held of record by the undersigned on March 1, 2018 at the Annual Meeting of Shareholders scheduled to be held on April 25, 2018, or at any adjournment or postponement thereof, on all matters coming before said meeting. The above proxies are hereby instructed to vote as shown on the reverse side of this card.
This proxy, when properly executed, will be voted in the manner directed herein. If no such direction is made, this proxy will be voted “FOR” each director nominee, “FOR” ratification of the appointment of Deloitte & Touche LLP as Portland General Electric Company’s independent registered public accounting firm for fiscal year 2018, “FOR” approval of the compensation of named executive officers, “FOR” approval of the Portland General Electric Company Stock Incentive Plan, as amended and restated, and in the discretion of the proxies with respect to such other business as may properly come before the meeting and at any adjournment or postponement thereof.
Your Vote is Important
To vote through the Internet or by telephone, see instructions on reverse side of this card. To vote by mail, sign and date this card on the reverse side and mail promptly in the postage-paid envelope.
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Address Changes/Comments:
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(If you noted any address changes/comments above, please mark corresponding box on the reverse side.)
Continued and to be signed on reverse side
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