IDAHO 6719 [APPLIED FOR]
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification Number)
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JOSEPH W. MARSHALL JAN B. PACKWOOD J. LAMONT KEEN
Chairman of the Board President Vice President and Treasurer
IDACORP, Inc. IDACORP, Inc. IDACORP, Inc.
1221 West Idaho Street 1221 West Idaho Street 1221 West Idaho Street
Boise, Idaho 83702-5627 Boise, Idaho 83702-5627 Boise, Idaho 83702-5627
(208) 388-2200 (208) 388-2200 (208) 388-2200
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ROBERT W. STAHMAN, ESQ. WILLIAM S. LAMB, ESQ.
Vice President and Secretary ELIZABETH W. POWERS, ESQ.
IDACORP, Inc. LeBoeuf, Lamb, Greene & MacRae, L.L.P.
1221 West Idaho Street 125 West 55th Street
Boise, Idaho 83702-5627 New York, New York 10019
(208) 388-2200 (212) 424-8000
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE OF THE SECURITIES TO THE PUBLIC: At the effective date of the share exchange, which shall occur as soon as practicable after this Registration Statement is declared effective and the satisfaction of all conditions precedent to the share exchange.
If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box. / /
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / /
CALCULATION OF REGISTRATION FEE
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO OFFERING PRICE AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED BE REGISTERED PER UNIT OFFERING PRICE REGISTRATION FEE
Common Stock,
without par value........................ 38,500,000 shares(1) $35.875(2) $1,381,187,500(2) $139,635(3)
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(1) The number of shares of IDACORP, Inc. common stock to be issued in exchange
for Idaho Power Company common stock in the share exchange described herein
cannot be precisely determined at the time this Registration Statement
becomes effective because shares of Idaho Power Company common stock may be
issued thereafter and until the effective time of the share exchange under
the Idaho Power Company Dividend Reinvestment and Stock Purchase Plan and
the Employee Savings Plan. This Registration Statement covers the number of
shares of IDACORP, Inc. common stock which is estimated to be at least as
large as the number of shares of Idaho Power Company common stock expected
to be outstanding at the effective time of the share exchange.
(2) The registration fee was calculated in accordance with Rule 457(f)(1) based
on the average of the high and low sale prices for shares of Idaho Power
Company common stock on the consolidated transaction reporting system on
March 10, 1998.
(3) Pursuant to Rule 457(b), the total fee required of $407,451 has been reduced
by the $267,816 filing fee previously paid at the time of filing of
preliminary proxy materials by Idaho Power Company on February 3, 1998.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
IDAHO POWER COMPANY
1221 West Idaho Street
Boise, Idaho 83702
P.O. Box 70
Boise, Idaho 83707
March 23, 1998
DEAR FELLOW SHAREHOLDER:
It is our pleasure to invite you to attend the 1998 Annual Meeting of Shareholders to be held on May 6, 1998, at 2:00 P.M., local time, at the Boise Centre on the Grove, 850 West Front Street, Boise, Idaho. Your Board of Directors and management look forward to personally greeting those shareholders able to attend.
Information about the nominees for election as members of the Board of Directors and the other business of the meeting is set forth in the Notice of Meeting and the Proxy Statement and Prospectus on the following pages. This year, you are asked to elect four Directors and to ratify the appointment of an independent auditor for the fiscal year ending December 31, 1998. In addition, there will be an important decision regarding the structure of our Company. You are being asked to consider and vote upon a proposal to form a holding company structure for Idaho Power Company.
In the formation of a holding company, each outstanding share of Idaho Power Company ("Idaho Power") common stock would be exchanged for one share of IDACORP, Inc. ("IDACORP") common stock. As a result, the common shareholders of Idaho Power would become the shareholders of IDACORP.
Your Board of Directors and management believe the formation of a holding company will offer the best means of positioning the Company to respond to the changing business environment in the electric utility industry. While the primary focus for IDACORP will be maintaining the strength of its core business--serving the electric needs of Idaho Power's customers, the formation of a holding company will provide greater flexibility to develop and operate new businesses in an increasingly competitive environment and to respond to new growth opportunities.
If the holding company formation is approved and becomes effective, it will not be necessary for you to turn in your Idaho Power common stock certificates in exchange for IDACORP common stock certificates. The certificates for Idaho Power common stock you now hold will automatically represent shares of IDACORP common stock. New certificates bearing the name of IDACORP will be issued in the future as certificates for presently outstanding shares of Idaho Power common stock are presented for transfer.
The utility industry is undergoing change, and Idaho Power continues to change to meet the challenges of a competitive future. Anticipating and responding to the competitive future is critical to our continued success.
The Board of Directors and management believe that the formation of a holding company is in the best interest of the shareholders and unanimously recommend approval of the holding company proposal and urge you to vote for the proposal.
YOUR VOTE IS IMPORTANT. YOU CAN BE SURE YOUR SHARES ARE REPRESENTED AT THE MEETING BY PROMPTLY RETURNING YOUR COMPLETED PROXY IN THE ENCLOSED ENVELOPE. You may revoke your proxy prior to or at the meeting and may vote in person if you wish.
Sincerely,
Joseph W. Marshall Jan B. Packwood CHAIRMAN OF THE BOARD AND PRESIDENT AND CHIEF CHIEF EXECUTIVE OFFICER OPERATING OFFICER |
IDAHO POWER COMPANY
1221 WEST IDAHO STREET
BOISE, IDAHO 83702
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
MAY 6, 1998, AT BOISE, IDAHO
March 23, 1998
TO THE SHAREHOLDERS OF
IDAHO POWER COMPANY:
The Annual Meeting of Shareholders of Idaho Power Company ("Idaho Power") will be held on May 6, 1998, at 2:00 P.M., local time, at the Boise Centre on the Grove, 850 West Front Street, Boise, Idaho 83702, for the following purposes:
1. to elect four Director nominees;
2. to approve the formation of a holding company and an Agreement and Plan of Exchange, whereby IDACORP, Inc. ("IDACORP"), an Idaho corporation formed by Idaho Power, will become the parent company of Idaho Power (the "Holding Company Proposal");
3. to ratify the selection of Deloitte & Touche LLP as independent auditor for the fiscal year ending December 31, 1998; and
4. to transact such other business that may properly come before the meeting.
All shareholders of record at the close of business on March 17, 1998 are entitled to notice of the meeting. Holders of Idaho Power common stock, 4% Preferred Stock, $100 par value, and 7.68% Series, Serial Preferred Stock, $100 par value, of record at the close of business on March 17, 1998, are entitled to vote at the meeting. Holders of Idaho Power 4% Preferred Stock, $100 par value, and 7.68% Series, Serial Preferred Stock, $100 par value, may be entitled to assert dissenters' rights of appraisal under Part 13 of the Idaho Business Corporation Act ("BCA") in connection with the Holding Company Proposal. The attached Proxy Statement and Prospectus contains a summary of the dissenters' rights provisions of the BCA (see "Proposal No. 2--HOLDING COMPANY PROPOSAL--Rights of Dissenting Shareholders") and a copy of Part 13 of the BCA (Exhibit D).
All shareholders are cordially invited to attend the Annual Meeting in person. WHETHER OR NOT YOU PLAN TO ATTEND, PLEASE RETURN YOUR PROXY PROMPTLY. It is important that you mark, sign, date and return the accompanying proxy, regardless of the size of your holdings, as promptly as possible. A self-addressed postage prepaid envelope is enclosed for you to return the proxy card. Any shareholder returning a proxy card who attends the meeting may vote in person by revoking that proxy prior to or at the meeting.
By Order of the Board of Directors
Robert W. Stahman
CORPORATE SECRETARY
TO SHAREHOLDERS WHO RECEIVE MULTIPLE PROXIES
IF YOU OWN IDAHO POWER STOCK (COMMON OR PREFERRED) OTHER THAN THE SHARES SHOWN ON THE ENCLOSED PROXY, YOU WILL RECEIVE A PROXY IN A SEPARATE ENVELOPE FOR EACH SUCH HOLDING. PLEASE EXECUTE AND RETURN EACH PROXY RECEIVED.
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH JURISDICTION.
SUBJECT TO COMPLETION DATED MARCH 16, 1998
This Proxy Statement and Prospectus contains both a Proxy Statement for the Annual Meeting of Shareholders of Idaho Power Company, an Idaho corporation ("Idaho Power" or the "Company"), to be held on May 6, 1998 (the "Annual Meeting") and a Prospectus of IDACORP, Inc., an Idaho corporation ("IDACORP"), relating to the issuance of up to 38,500,000 shares of common stock, without par value, of IDACORP ("IDACORP Common Stock"), upon the effectiveness of the proposed formation of a holding company for Idaho Power as described herein.
Pursuant to an Agreement and Plan of Exchange (the "Exchange Agreement"), a copy of which is attached hereto as Exhibit A, Idaho Power proposes to reorganize itself into a holding company structure. Under the terms of the Exchange Agreement, each outstanding share of Idaho Power common stock, $2.50 par value ("Idaho Power Common Stock"), will be exchanged for one share of IDACORP Common Stock (the "Exchange"). As a result of the Exchange, Idaho Power will become a wholly-owned subsidiary of IDACORP, and all of the IDACORP Common Stock outstanding immediately after the effective date of the Exchange will be owned by the holders of the Idaho Power Common Stock outstanding immediately prior to the effective date of the Exchange. See "Proposal No. 2--HOLDING COMPANY PROPOSAL."
All shareholders of record at the close of business on March 17, 1998 are entitled to notice of the meeting. Holders of Idaho Power Common Stock, 4% Preferred Stock, $100 par value, and 7.68% Series, Serial Preferred Stock, $100 par value, of record at the close of business on March 17, 1998, are entitled to vote at the meeting. Holders of Idaho Power 4% Preferred Stock, $100 par value, and 7.68% Series, Serial Preferred Stock, $100 par value, may be entitled to assert dissenters' rights of appraisal under Part 13 of the Idaho Business Corporation Act ("BCA") in connection with the Holding Company Proposal. This Proxy Statement and Prospectus contains a summary of the dissenters' rights provisions of the BCA (see Proposal No. 2--HOLDING COMPANY PROPOSAL--Rights of Dissenting Shareholders) and a copy of Part 13 of the BCA (Exhibit D).
The principal executive offices of Idaho Power and of IDACORP are located at 1221 West Idaho Street, Boise, Idaho 83702, telephone (208) 388-2200.
This Proxy Statement and Prospectus and the accompanying proxy, solicited on behalf of the Board of Directors of Idaho Power, and the 1997 Annual Report to Shareholders were first sent to shareholders of Idaho Power on or about March 23, 1998.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
The date of this Proxy Statement and Prospectus is March 23, 1998.
TABLE OF CONTENTS
PAGE
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AVAILABLE INFORMATION........................................................... 1
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE................................. 1
SUMMARY......................................................................... 3
VOTING.......................................................................... 8
PROPOSAL NO. 1--ELECTION OF DIRECTORS........................................... 9
Nominees for Election......................................................... 9
Continuing Directors.......................................................... 10
Meetings of the Board and Committees.......................................... 13
Transactions with Management.................................................. 13
PROPOSAL NO. 2--HOLDING COMPANY PROPOSAL........................................ 14
General....................................................................... 14
Idaho Power................................................................... 14
Reasons for the Holding Company Proposal...................................... 15
Agreement and Plan of Exchange................................................ 15
Amendment or Termination of Exchange Agreement................................ 16
Effective Date of the Exchange................................................ 16
Exchange of Stock Certificates Not Required................................... 16
Certain Considerations........................................................ 16
Regulatory Approvals.......................................................... 17
Regulation of IDACORP......................................................... 17
Business of IDACORP........................................................... 18
Treatment of Preferred Stock.................................................. 18
Rights of Dissenting Shareholders............................................. 19
Dividend Policy............................................................... 20
Listing of IDACORP Common Stock............................................... 20
United States Federal Income Tax Consequences................................. 20
IDACORP Capitalization........................................................ 22
Comparative Shareholders' Rights.............................................. 24
Rights Agreement.............................................................. 26
Certain Idaho Statutory Provisions............................................ 26
Directors and Management...................................................... 27
Dividend Reinvestment and Stock Purchase Plan................................. 28
Common Stock Plans............................................................ 28
Market Price of Idaho Power Common Stock...................................... 28
Transfer Agent and Registrar.................................................. 28
PROPOSAL NO. 3--RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITOR.............. 28
SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS.......................... 29
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE......................... 29
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS................................ 29
Report of Compensation Committee of the Board of Directors on Executive 29
Compensation................................................................
Summary Compensation Table.................................................... 32
Long-Term Incentive Plans--Awards in Last Fiscal Year......................... 33
Director Compensation......................................................... 33
Compensation Committee Interlocks and Insider Participation................... 33
Employment Contracts.......................................................... 33
Performance Graph............................................................. 34
Retirement Benefits........................................................... 35
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PAGE
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Pension Plan Table............................................................ 35
EXPERTS......................................................................... 36
LEGAL OPINIONS.................................................................. 36
OTHER BUSINESS.................................................................. 36
1999 ANNUAL MEETING OF SHAREHOLDERS............................................. 36
EXHIBIT A - AGREEMENT AND PLAN OF EXCHANGE...................................... A-1
EXHIBIT B - RESTATED ARTICLES OF INCORPORATION OF IDACORP....................... B-1
EXHIBIT C - AMENDED BYLAWS OF IDACORP........................................... C-1
EXHIBIT D - PART 13 "DISSENTERS' RIGHTS" OF THE IDAHO BUSINESS
CORPORATION ACT................................................. D-1
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No person has been authorized to give any information or to make any representation not contained in this Proxy Statement and Prospectus. If given or made, such information or representation must not be relied upon as having been authorized by either IDACORP or Idaho Power. This Proxy Statement and Prospectus does not constitute an offer to sell or a solicitation of an offer to buy shares of IDACORP Common Stock or the solicitation of a proxy to or from any person to or from whom it is unlawful to make such offer or solicitation of an offer or proxy solicitation in such jurisdiction. Neither the delivery of this Proxy Statement and Prospectus nor any distribution of the securities made under this Proxy Statement and Prospectus shall, under any circumstances, create any implication that there has been no change in the affairs of Idaho Power or IDACORP or in the information set forth herein since the date of this Proxy Statement and Prospectus.
AVAILABLE INFORMATION
Idaho Power is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act") and in accordance therewith files reports, proxy statements and other information with the Securities and Exchange Commission (the "SEC"). Such reports, proxy statements and other information can be inspected and copied, at prescribed rates, at the offices of the SEC specified below. Idaho Power Common Stock is listed on the New York Stock Exchange ("NYSE") and the Pacific Stock Exchange ("PSE"), and reports, proxy statements and other information concerning Idaho Power may be inspected at the offices of such exchanges.
IDACORP has filed with the SEC a registration statement (the "Registration Statement") under the Securities Act of 1933, as amended (the "Securities Act"), registering the shares of IDACORP Common Stock to be issued upon effectiveness of the Exchange. This Proxy Statement and Prospectus, which constitutes a part of the Registration Statement, does not contain all of the information set forth in the Registration Statement, certain parts of which are omitted in accordance with the rules and regulations of the SEC. Such Registration Statement and the exhibits thereto may be inspected and copied, at prescribed rates, at the public reference facilities maintained by the SEC at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549 and at the SEC's regional offices at 500 West Madison Street, Suite 1400, Chicago, Illinois 60661 and 7 World Trade Center, Suite 1300, New York, New York 10048. The SEC also maintains a web site that contains reports, proxy statements and other information regarding registrants that file electronically with the SEC. The address of such site is at http://www.sec.gov.
IDACORP will become subject to the same informational requirements as Idaho Power following the Exchange described in this Proxy Statement and Prospectus, and both IDACORP and Idaho Power will file reports and other information with the SEC in accordance with the Exchange Act. Upon completion of the Exchange, IDACORP Common Stock will be listed on the NYSE and PSE. At the time of such listing, Idaho Power Common Stock will be withdrawn from listing and registration under Section 12 of the Exchange Act.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
THIS PROXY STATEMENT AND PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT PRESENTED HEREIN OR DELIVERED HEREWITH. THESE DOCUMENTS, OTHER THAN EXHIBITS THERETO, UNLESS THEY ARE SPECIFICALLY INCORPORATED BY REFERENCE, ARE AVAILABLE WITHOUT CHARGE TO ANY PERSON TO WHOM THIS PROXY STATEMENT AND PROSPECTUS IS DELIVERED, UPON WRITTEN OR ORAL REQUEST TO ROBERT W. STAHMAN, ESQ., IDAHO POWER COMPANY, 1221 WEST IDAHO STREET, BOISE, ID 83702, (208) 388-2676. IN ORDER TO ENSURE TIMELY DELIVERY OF THE DOCUMENTS, ANY REQUEST SHOULD BE MADE BY APRIL 29, 1998.
The following document, which has heretofore been filed by Idaho Power with the SEC pursuant to the Exchange Act, is incorporated by reference in this Proxy Statement and Prospectus and shall be deemed to be a part hereof:
Idaho Power's Annual Report on Form 10-K for the year ended December 31, 1997.
All documents filed by Idaho Power with the SEC pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Proxy
Statement and Prospectus and prior to the termination of the offering covered by
this Proxy Statement and Prospectus shall be incorporated herein by reference
and shall be deemed to be a part hereof from the date of filing of such
documents (such documents, and the document enumerated above, being hereinafter
referred to as "Incorporated Documents"; provided, however, in each year during
which an offering is made by this Proxy Statement and Prospectus, all documents
filed by Idaho Power pursuant to Section 13, 14 or 15 of the Exchange Act prior
to the filing with the SEC of Idaho Power's Annual Report on Form 10-K covering
such year shall not be Incorporated Documents or be incorporated by reference in
this Proxy Statement and Prospectus or be a part hereof from and after such
filing of such Annual Report on Form 10-K).
Any statement contained in an Incorporated Document shall be deemed to be modified or superseded for purposes of this Proxy Statement and Prospectus to the extent that a statement contained herein or in any other subsequently filed Incorporated Document modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Proxy Statement and Prospectus.
SUMMARY
The following Summary highlights selected information on the matters to be voted on at the Annual Meeting. Reference is made to, and this Summary is qualified in its entirety by, the more detailed information contained in, attached to or incorporated by reference in this Proxy Statement and Prospectus and the Exhibits hereto.
VOTING
The outstanding voting securities of the Company as of the record date for the meeting are as follows: 166,407 shares of 4% Preferred Stock, $100 par value (the "4% Preferred Stock"), each share being entitled to twenty votes; 150,000 shares of 7.68% Series, Serial Preferred Stock, $100 par value (the "7.68% Series Preferred Stock"), each share being entitled to one vote (together with the 4% Preferred Stock, the "Idaho Power Voting Preferred Stock"); and 37,612,351 shares of Common Stock, $2.50 par value, each share being entitled to one vote (the outstanding voting securities together constituting "Idaho Power Voting Stock"). The aggregate voting power of Idaho Power Voting Stock is 41,090,491 votes.
Only holders of record of shares of Idaho Power Voting Stock on March 17, 1998 (the "Record Date") will be entitled to vote at the Annual Meeting.
PROPOSAL NO. 1--ELECTION OF DIRECTORS
Directors are elected by a plurality of the votes cast by shares entitled to vote at the meeting for the election of directors.
PROPOSAL NO. 2--HOLDING COMPANY PROPOSAL
1. WHAT IS IDAHO POWER'S HOLDING COMPANY PROPOSAL?
Pursuant to the Exchange Agreement, a copy of which is attached as Exhibit A hereto, the Company will reorganize itself into a holding company structure. In the Exchange, each outstanding share of Idaho Power Common Stock will be exchanged for one share of IDACORP Common Stock. As a result of the Exchange, Idaho Power will become a wholly-owned subsidiary of IDACORP, and all of the IDACORP Common Stock outstanding immediately after the effective date of the Exchange will be owned by the holders of Idaho Power Common Stock outstanding immediately prior to the effective date of the Exchange.
Subject to the rights of dissenting shareholders that may apply to certain series of the preferred stock and are summarized below, each outstanding share of each series of preferred stock of Idaho Power, which consists of the following: 4% Preferred Stock, $100 par value; 7.68% Series, Serial Preferred Stock, $100 par value; Flexible Auction Series A, Serial Preferred Stock, without par value; and 7.07% Series, Serial Preferred Stock, without par value (collectively, the "Idaho Power Preferred Stock"), will continue unchanged as an issued and outstanding share of Idaho Power Preferred Stock with the same preferences, designations, relative rights, privileges and powers, and subject to the same restrictions, limitations and qualifications as were applicable to such shares prior to the effective date of the Exchange.
The outstanding first mortgage bonds of Idaho Power and all other contracts and agreements to which Idaho Power is a party and the terms thereof will not be altered as a result of the Exchange. Idaho Power's Restated Articles of Incorporation, as amended ("Idaho Power Articles"), will not be changed in any way as a result of the Exchange.
On or as soon as practicable after the Exchange, Idaho Power will transfer to IDACORP the stock of one of its non-utility subsidiaries, Ida-West Energy Company ("Ida-West").
CERTAIN CONSIDERATIONS
Certain factors that should be considered in determining whether or not to vote to approve the Holding Company Proposal are discussed under "Proposal No. 2--HOLDING COMPANY PROPOSAL--Certain Considerations." (Please see pages 16-17.)
2. WHY DOES THE BOARD RECOMMEND FORMING A HOLDING COMPANY?
The Board of Directors proposes to reorganize Idaho Power into a holding company structure to respond to the changing business environment in the electric utility industry. The move to a competitive electricity industry, together with technological advances in the energy business, has created new opportunities for energy companies like Idaho Power. A holding company structure will allow the Company to better define and separate Idaho Power's regulated and unregulated businesses and help protect the utility business and utility customers from the risks that may be involved in future non-utility ventures. The Board of Directors and management believe that formation of the holding company serves the best interests of the customers and shareholders of Idaho Power. (Please see pages 14-28.)
3. WHAT WOULD THE HOLDING COMPANY STRUCTURE LOOK LIKE?
The following charts show Idaho Power's current structure and the proposed holding company structure:
[CHART]
4. IN WHAT TYPES OF BUSINESSES WOULD IDACORP INVEST?
Although specific investment opportunities have not been determined, the primary focus would be maintaining the strength of Idaho Power's core business--serving the electric needs of Idaho Power's customers. It is expected that participation in other opportunities would be related to the energy business. (Please see pages 15 and 18.)
5. WHO MUST APPROVE THE FORMATION OF THE HOLDING COMPANY?
Approval of the proposed holding company is required from the Federal Energy Regulatory Commission ("FERC") and the state public utility commissions of Idaho, Nevada, Oregon and Wyoming.
Applications for approval have been filed with each commission, and orders have been received from the state public utility commissions of Idaho and Oregon. Most importantly, the holding company proposal requires a favorable vote from the Company's shareholders. (Please see pages 8-9 and 17.)
6. HOW WOULD MY OWNERSHIP OF IDAHO POWER STOCK BE AFFECTED BY THE NEW STRUCTURE?
Owners of Idaho Power Common Stock automatically would become owners of IDACORP Common Stock on a share-for-share basis. It is expected that the IDACORP Common Stock would be traded on the NYSE and the PSE. (Please see page 20.)
Idaho Power preferred stock would remain a security of Idaho Power. As discussed on pages 18-19, holders of certain series of Idaho Power preferred stock may be entitled to assert dissenters' rights in connection with the Exchange.
7. WOULD SHAREHOLDERS HAVE TO TURN IN THEIR CURRENT STOCK CERTIFICATES?
No. Idaho Power Common Stock certificates automatically would represent the same number of shares of common stock of IDACORP. IT WOULD NOT BE NECESSARY FOR HOLDERS OF IDACORP COMMON STOCK TO EXCHANGE THEIR STOCK CERTIFICATES. (Please see page 16.)
8. HOW WOULD A HOLDING COMPANY STRUCTURE AFFECT COMMON AND PREFERRED STOCK DIVIDENDS?
Common shareholders would receive dividends from IDACORP rather than from Idaho Power. When the restructuring takes effect, it is expected that dividends on IDACORP Common Stock will be no less than the dividends Idaho Power is then paying on its common stock and that IDACORP dividends will be paid on approximately the same dates in each year as Idaho Power dividends are paid now. Subsequently, dividends would depend on the financial performance of IDACORP's subsidiaries, principally Idaho Power, and on other factors. (Please see pages 16-17.)
The preferred stock would continue to be a security of Idaho Power and the holders of preferred stock would continue to have priority as to Idaho Power dividends. (Please see page 18-19.)
9. WOULD THE DIVIDEND REINVESTMENT PLAN CONTINUE UNDER A HOLDING COMPANY STRUCTURE?
Yes. All shares of Idaho Power Common Stock held under the Dividend Reinvestment and Stock Purchase Plan will be automatically exchanged for shares of IDACORP Common Stock. The Dividend Reinvestment and Stock Purchase Plan will be continued with IDACORP Common Stock after the Exchange. (Please see page 28.)
10. HOW WOULD FORMATION OF A HOLDING COMPANY AFFECT PERSONAL FEDERAL INCOME TAXES?
There would be no federal income tax consequences to Idaho Power common shareholders when Idaho Power Common Stock is converted to IDACORP Common Stock. For capital gains purposes, the tax basis and holding period of IDACORP Common Stock would be the same as those for Idaho Power Common Stock. (Please see pages 20-22.)
11. WHAT WOULD THE NEW HOLDING COMPANY BE CALLED?
The new holding company will be called IDACORP, Inc.
12. WHAT WOULD BE THE EFFECTIVE DATE OF THE HOLDING COMPANY FORMATION?
The effective date would occur as soon as practicable after the receipt of approval by the shareholders of the Company and the receipt of all necessary regulatory approvals. Although the Company cannot predict when such approvals will be in place, the Company is hopeful that the effective date will occur in the second half of 1998. (Please see page 16.)
13. WHO WOULD MANAGE THE HOLDING COMPANY AFTER THE RESTRUCTURING?
The Board of Directors and certain of the principal executive officers of Idaho Power will also serve as the Board of Directors and executive officers of IDACORP. (Please see page 27-28.)
14. ARE THERE RIGHTS OF DISSENTING SHAREHOLDERS?
Holders of Idaho Power Common Stock, Flexible Auction Series A, Serial Preferred Stock, without par value, and 7.07% Series, Serial Preferred Stock, without par value, do not have dissenters' rights.
Holders of shares of 4% Preferred Stock, $100 par value, and 7.68% Series, Serial Preferred Stock, $100 par value, who do not vote their shares in favor of the Holding Company Proposal and meet all the requisite statutory requirements contained in Sections 30-1-1301 through 30-1-1331 of the Idaho Business Corporation Act ("BCA"), the full text of which is reproduced as Exhibit D to this Proxy Statement and Prospectus, are entitled to demand in writing that the Company pay to such shareholder the fair value, plus accrued interest, of the shares of such stock held by such shareholder ("Dissenters' Rights"). Any shareholder entitled to Dissenters' Rights who wishes to make a demand for appraisal is urged to review carefully the provisions of Sections 30-1-1301 through 30-1-1331 of the BCA, particularly the provisions setting forth the procedural steps required to perfect the appraisal rights. Appraisal rights will be lost if such procedural requirements are not fully satisfied. (Please see page 19.)
ANY SHAREHOLDER ENTITLED TO DISSENTERS' RIGHTS WHO DESIRES TO EXERCISE SUCH RIGHTS SHOULD CAREFULLY REVIEW THE BCA AND IS ADVISED TO CONSULT HIS LEGAL ADVISOR BEFORE EXERCISING OR ATTEMPTING TO EXERCISE SUCH RIGHTS.
15. WILL THERE BE CHANGES IN MY SHAREHOLDERS' RIGHTS?
The affirmative vote of a majority of (i) all the votes entitled to be cast by the Idaho Power Voting Stock, voting as a single class, and (ii) all the votes entitled to be cast by the Idaho Power Common Stock is required to approve the Holding Company Proposal.
PROPOSAL NO. 3--RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITOR
The selection of auditor is ratified where the votes cast favoring ratification exceed those cast opposing ratification.
VOTING
Under the BCA, a majority of the votes entitled to be cast on a matter by a voting group constitutes a quorum of that voting group for action on that matter. Assuming a quorum is present, the following votes are required for approval of each proposal at the Annual Meeting: (i) Proposal No. 1--directors are elected by the affirmative vote of a plurality of the votes cast by the shares entitled to vote in the election of directors; (ii) Proposal No. 2--the Holding Company Proposal is approved by the affirmative vote of (y) a majority of all the votes entitled to be cast by Idaho Power Voting Stock, voting as a single class and (z) a majority of all the votes entitled to be cast by Idaho Power Common Stock; and (iii) Proposal No. 3--the selection of auditor is ratified where the votes cast within the voting group favoring ratification exceed the votes cast opposing ratification.
Voting of shares held by brokers or other nominees is regulated by the NYSE and other securities exchanges. In certain cases, referred to as "discretionary matters," brokers or other nominees may vote, and deliver proxies with respect to, such shares in their own discretion. In other cases, referred to as "nondiscretionary matters," brokers or other nominees may deliver proxies with respect to particular shares, but are not permitted to vote such shares without specific instructions from the beneficial owner of the shares. These unvoted shares are called "broker non-votes." The Holding Company Proposal is considered "non-discretionary," and brokers or other nominees who have received no instructions from their beneficial owners do not have the authority to vote on the proposal. With respect to the Holding Company Proposal, an abstention or broker non-vote will have the effect of a vote against the proposal.
With respect to the election of directors, votes may be cast in favor or withheld; votes that are withheld will have no effect on the results.
If no direction is given by a shareholder, proxies received will be voted FOR Proposal No. 1, election of management's nominees for Directors, FOR Proposal No. 2, approval of the Holding Company Proposal, and FOR Proposal No. 3, ratification of the selection of Deloitte & Touche LLP as independent auditor for the fiscal year 1998.
The outstanding voting securities of the Company as of the record date for the meeting are as follows: 166,407 shares of 4% Preferred Stock, each share being entitled to twenty votes; 150,000 shares of 7.68% Series Preferred Stock, each share being entitled to one vote; and 37,612,351 shares of Idaho Power Common Stock, each share being entitled to one vote. The aggregate voting power of Idaho Power Voting Stock is 41,090,491 votes.
It is the policy of the Company that all proxy cards and ballots for
shareholder meetings that identify shareholders, including employees, are to be
kept secret, and no such document shall be available for examination nor shall
the identity and vote of any shareholder be disclosed to the Company or to any
third party. Proxy cards shall be returned in envelopes addressed to the
independent tabulator who receives, inspects and tabulates the proxies.
Individual voted proxies and ballots are not seen by nor reported to the Company
except (i) as necessary to meet applicable legal requirements, (ii) to allow the
independent election inspectors to certify the results of the shareholder vote,
(iii) in the event of a matter of significance where there is a proxy
solicitation in opposition to the Board of Directors, based upon an opposition
proxy statement filed with the SEC, or (iv) to respond to shareholders who have
written comments on their proxies.
A proxy may be revoked at any time before it is voted at the meeting. Any shareholder who attends the meeting and wishes to vote in person may revoke his or her proxy by oral notice at that time. Otherwise, revocation of a proxy must be mailed to the Corporate Secretary of the Company at 1221 West Idaho Street, Boise, Idaho 83702-5627, and received prior to the meeting.
The close of business on March 17, 1998 is the record date for determining shareholders entitled to notice of and to vote at the meeting.
The cost of soliciting proxies will be paid by the Company. Besides soliciting by mail, the Company may request the return of proxies personally or by telephone, telegraph or facsimile without extra compensation. Additionally, solicitation of proxies from brokers, banks, nominees and institutional investors will be made by Beacon Hill Partners, Inc., at a cost to the Company of approximately $5,500 plus out-of-pocket expenses. The Company will reimburse banks, brokerage firms and other custodians, nominees and fiduciaries for their expenses in sending proxy materials to beneficial owners.
PROPOSAL NO. 1--ELECTION OF DIRECTORS
The Idaho Power Articles provide that the Directors of the Company be elected for three-year terms with approximately one-third of the Board of Directors to be elected at each Annual Meeting of Shareholders. The four Directors standing for election at the 1998 Annual Meeting are identified below as nominees for election with terms expiring in the year 2001. All nominees are currently Directors of the Company.
Unless otherwise instructed, proxies received will be voted in favor of the election of the Director nominees. While it is not expected that any of the nominees will be unable to qualify for or accept office, if for any reason one or more shall be unable to do so, the proxies will be voted for nominees selected by the Board of Directors.
NOMINEES FOR ELECTION--TERMS EXPIRE 2001
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ROBERT D. BOLINDER Age 66 Director since 1980
President of Robert D. Bolinder Associates; Director of
[PHOTO] Hannaford Bros. Co. Inc.; retired director and Executive
Vice President--Corporate Development and Planning of
Smith's Food & Drug Centers, Inc. (1988-1996).
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JON H. MILLER Age 60 Director since 1988
Private Investor; formerly President and Chief Operating
[PHOTO] Officer (1978-1990) and a director (1977-1990) of Boise
Cascade Corporation; director of Specialty Paperboard
Corporation.
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GENE C. ROSE Age 69 Director since 1983
Formerly partner, now of counsel to the law firm of Yturri,
[PHOTO] Rose, Burnham, Bentz & Helfrich.
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PHIL SOULEN Age 68 Director since 1971
President of Soulen Livestock Co.; President of Weiser Feed
[PHOTO] & Storage, Inc.
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CONTINUING DIRECTORS--TERMS EXPIRE 2000
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PETER T. JOHNSON Age 65 Director since 1993
Private Investor; formerly Administrator of the Bonneville
[PHOTO] Power Administration (1981-1986); director of Standard
Insurance Company.
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JOSEPH W. MARSHALL Age 59 Director since 1989
Chairman of the Board and Chief Executive Officer of Idaho
[PHOTO] Power Company (1989 to present).
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PETER S. O'NEILL Age 61 Director since
1995
President, O'Neill Enterprises Inc. (since 1990); director
[PHOTO] of BMC West Corporation.
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JAN B. PACKWOOD Age 54 Director since 1997
President and Chief Operating Officer of Idaho Power Company
[PHOTO] (since 1997); formerly Executive Vice President (1996-1997)
and Vice President-Bulk Power (1989-1996) of Idaho Power
Company.
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CONTINUING DIRECTORS--TERMS EXPIRE 1999
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ROGER L. BREEZLEY Age 59 Director since 1993
Private Investor; formerly a director (1983-1995), Chairman
[PHOTO] of the Board (1987-1994) and Chief Executive Officer
(1987-1993) of U.S. Bancorp.
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JOHN B. CARLEY Age 64 Director since 1990
Chairman of the Executive Committee of the Board of
[PHOTO] Directors (1996) of Albertson's, Inc.; formerly President
(1984-1996) and Chief Operating Officer (1990-1996) of
Albertson's, Inc.; director of Boise Cascade Office Products
Co.
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JACK K. LEMLEY Age 63 Director since 1995
Director of Lemley & Associates, Inc. (since 1987) and
[PHOTO] Chairman of the Board and Chief Executive Officer of
American Ecology Corp.
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EVELYN LOVELESS Age 64 Director since 1987
Chief Executive Officer (since 1992) and a director of
[PHOTO] Global, Inc.; director of Key Bank of Idaho (since 1993);
formerly President of Global, Inc. (1989-1992).
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MEETINGS OF THE BOARD AND COMMITTEES
The Board of Directors held six meetings during 1997. All incumbent Directors attended all of the meetings of the Board of Directors and all committees of which they were members. Board committees, their membership during 1997 and a brief statement of their principal responsibilities are presented below.
EXECUTIVE COMMITTEE
The Executive Committee, pursuant to the Company's Bylaws, can exercise the authority of the full Board of Directors which may be lawfully delegated between meetings of the full Board in the management of the business affairs of the Company. It also acts as a nominating committee to review and make recommendations to the Board of Directors for Director candidates to fill Board vacancies and to select nominees for membership on Board committees. In addition, it considers shareholder nominees for the Board of Directors for whom written resumes are received prior to December 10 for the next year's annual meeting. Members of the Committee are Robert D. Bolinder (chairman), John B. Carley, Joseph W. Marshall, Jon H. Miller and Gene C. Rose. During 1997, the Executive Committee met one time.
AUDIT COMMITTEE
The primary function of the Audit Committee is to assist the Board of Directors in fulfilling its oversight responsibilities by reviewing the financial information which will be provided to the shareholders and others, the systems of internal controls which management and the Board have established, the audit process and services provided by the independent auditors, the plans and activities of the Internal Audit Department and the conducting of business under the Business Conduct Guide. Members of the Committee are Gene C. Rose (chairman), Robert D. Bolinder, Peter T. Johnson and Jack K. Lemley. During 1997, the Audit Committee met six times.
COMPENSATION COMMITTEE
The primary function of the Compensation Committee is to assist the Board of Directors in discharging its duties and responsibilities regarding management of the Company's total compensation philosophy, total compensation programs for executives, senior managers and employees, and all other compensation-related matters which properly come before the Board of Directors. Members of the Committee are John B. Carley (chairman), Peter T. Johnson, Evelyn Loveless and Peter S. O'Neill. During 1997, the Compensation Committee met three times.
FINANCE COMMITTEE
The Finance Committee has authority to authorize and approve the issuance and sale or contract for the sale of debt securities and/or the call for redemption of debt securities of the Company. Members of the Committee are Joseph W. Marshall (chairman), Robert D. Bolinder, John B. Carley and Jon H. Miller. During 1997, the Finance Committee did not meet.
INVESTMENT COMMITTEE
The primary function of the Investment Committee is to assist the Board of Directors in fulfilling its oversight responsibilities to participants and beneficiaries under the Retirement Plan and to the Company's shareholders by reviewing plan design, formulating investment philosophies and establishing investment policies, establishing performance measurement objectives and benchmarks, monitoring the performance of investment managers, trustees, independent consultants and consulting actuaries to the plan, reviewing sufficiency of plan assets to cover liabilities and reviewing compliance with all applicable laws and regulations pertaining to the plan. Members of the Committee are Jon H. Miller (chairman), Roger L. Breezley, Phil Soulen and Jan B. Packwood. During 1997, the Investment Committee met three times.
TRANSACTIONS WITH MANAGEMENT
See "COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS--Compensation Committee Interlocks and Insider Participation" for additional information regarding Mr. O'Neill.
PROPOSAL NO. 2--HOLDING COMPANY PROPOSAL
GENERAL
The Board of Directors and management of Idaho Power consider it to be in the best interests of Idaho Power, its shareholders and customers to change the corporate organization of Idaho Power into a holding company structure. This will result in Idaho Power becoming a wholly-owned subsidiary of IDACORP, with the present holders of Idaho Power Common Stock becoming the holders of the IDACORP Common Stock.
Idaho Power has formed IDACORP, a newly-incorporated subsidiary of Idaho Power, to effect the organization into a holding company structure. Idaho Power and IDACORP have approved the Exchange Agreement under which, subject to shareholder approval as required by the BCA and other conditions as set forth therein, the Exchange will be effected, and Idaho Power will become a subsidiary of IDACORP. In the Exchange, each share of Idaho Power Common Stock will be converted into one share of IDACORP Common Stock. A copy of the Exchange Agreement is attached to this Proxy Statement and Prospectus as Exhibit A and incorporated herein by reference. It is not expected that the Exchange will affect the position of the present common shareholders of Idaho Power for United States federal income tax purposes. See "--HOLDING COMPANY PROPOSAL--United States Federal Income Tax Consequences". The Holding Company Proposal is also subject to various approvals by regulatory authorities. See "--HOLDING COMPANY PROPOSAL--Regulatory Approvals."
Except for the exercise of Dissenters' Rights as described below, the other securities of Idaho Power, including its first mortgage bonds and each series of Idaho Power Preferred Stock, will not be changed by the Exchange, and each will continue to be outstanding securities of Idaho Power. See "--HOLDING COMPANY PROPOSAL--Treatment of Preferred Stock and--Rights of Dissenting Shareholders."
In conjunction with the formation of a holding company, one of the non-utility subsidiaries of Idaho Power, Ida-West, will become a subsidiary of IDACORP, on, or as soon as practicable after, the effective date of the Exchange. IDACORP may form or acquire other unregulated subsidiaries in the future. Ida-West and any future non-utility subsidiaries of IDACORP are hereinafter referred to as the "IDACORP Subsidiaries."
IDAHO POWER
Idaho Power is an electric public utility incorporated under the laws of the
State of Idaho in 1989 as successor to a Maine corporation organized in 1915.
The principal executive offices of Idaho Power are located at 1221 West Idaho
Street, Boise, Idaho 83702-5627. Its telephone number, including area code, is
(208) 388-2200.
The Company is engaged in the generation, purchase, transmission, distribution and sale of electric energy in an approximate 20,000 square-mile area in southern Idaho, eastern Oregon and northern Nevada, with an estimated population of 754,000 people. Idaho Power holds franchises in approximately 70 cities in Idaho and 10 cities in Oregon, and holds certificates from the respective public utility regulatory authorities to serve all or a portion of 28 counties in Idaho, 3 counties in Oregon and 1 county in Nevada.
Idaho Power operates 17 hydro power plants and shares ownership in three coal-fired generating plants. Idaho Power relies heavily on hydroelectric power for its generating needs and is one of the nation's few investor-owned utilities with a predominantly hydro base. It participated in the development of thermal generation in the neighboring states of Wyoming, Oregon and Nevada using low-sulfur coal from Wyoming and Utah.
REASONS FOR THE HOLDING COMPANY PROPOSAL
The principal reason for the formation of a holding company is to respond to the changing business environment in the electric utility industry in a manner that serves the best interests of the shareholders and customers of Idaho Power. The formation of IDACORP as the parent company over Idaho Power will allow Idaho Power to continue to operate its regulated utility business efficiently, while providing for the separation of certain non-regulated businesses of Idaho Power from the regulated utility business. The holding company structure will make it easier for IDACORP to enter into new businesses within the energy industry as well as continue its diversification into other businesses.
Competition is increasing in the electric utility industry due to a variety of developments including the changes enacted by the Energy Policy Act of 1992, new regulatory policies issued by the FERC and state regulatory initiatives. As part of its ongoing strategic planning process, Idaho Power has determined that the increasingly competitive energy market requires a restructuring of the Company.
The changes presently underway in the electric utility industry are dramatically changing the nature of the regulated utility business. For example, the FERC has issued an order requiring all utility companies to provide access to their transmission lines for the wheeling of power over their system. This "open access" policy has led to the creation of power marketing companies that sell power at market-based rates and buy and sell electric energy in the wholesale power market. Many utility holding companies have formed non-regulated power marketing subsidiaries to market electric power to other utility companies and to industrial users. IDACORP may wish to form such a power marketing subsidiary. The Company has a marketing business unit, formed in 1997, that is participating in the wholesale electricity markets and in natural gas trading.
Idaho Power also believes that the holding company structure will facilitate the development of future unregulated businesses. As an unregulated company, IDACORP will be able to enter into new businesses without obtaining the prior approval of state regulatory commissions. The holding company structure will also permit the use of financing techniques by the unregulated businesses that are better suited to the particular requirements, characteristics and risks of non-regulated businesses. Because IDACORP will not be a regulated utility, securities issued by it and by its unregulated subsidiaries will not be subject to the jurisdiction of state utility regulators or the FERC.
Following the formation of IDACORP, Idaho Power will continue to operate as a public utility subject to the jurisdiction of the FERC, the Idaho Public Utilities Commission ("IPUC"), the Oregon Public Utilities Commission ("OPUC"), the Public Service Commission of Nevada and the Public Service Commission of Wyoming.
AGREEMENT AND PLAN OF EXCHANGE
The Exchange Agreement in the form attached hereto as Exhibit A has been unanimously approved by the Boards of Directors of Idaho Power and IDACORP and has been executed by authorized officers of each company. In the Exchange, each outstanding share of Idaho Power Common Stock will be exchanged for one share of IDACORP Common Stock. As a result of the Exchange, Idaho Power will become a wholly-owned subsidiary of IDACORP, and all of the IDACORP Common Stock outstanding immediately after the effective date of the Exchange will be owned by the holders of Idaho Power Common Stock outstanding immediately prior to the effective date of the Exchange.
Subject to any applicable Dissenters' Rights, each outstanding share of each series of Idaho Power Preferred Stock will continue unchanged as an issued and outstanding share of Idaho Power Preferred Stock with the same preferences, designations, relative rights, privileges and powers, and subject to the same restrictions, limitations and qualifications as were applicable to such shares prior to the effective date of the Exchange. See "--Rights of Dissenting Shareholders" below.
The outstanding first mortgage bonds of Idaho Power and all other contracts and agreements to which Idaho Power is a party and the terms thereof will not be altered as a result of the Exchange. The Idaho Power Articles will not be changed in any way as a result of the Exchange.
AMENDMENT OR TERMINATION OF EXCHANGE AGREEMENT
By the mutual consent of their respective Boards of Directors, Idaho Power and IDACORP may amend, modify, supplement or waive compliance with any provision or condition in the Exchange Agreement in such manner as may be agreed upon by them at any time before or after approval of the Holding Company Proposal by the shareholders of Idaho Power; provided, however, that no amendment, modification or supplement shall be made which would, in the judgment of the Board of Directors of Idaho Power, materially and adversely affect the shareholders of Idaho Power.
The Exchange Agreement may be terminated, at any time before or after its approval by the shareholders of Idaho Power, by action of the Board of Directors of Idaho Power if it determines, in its sole discretion, that consummation of the Exchange would be inadvisable or not in the best interests of Idaho Power or its shareholders. In making such determination, the Board of Directors of Idaho Power would consider, among other things, the nature of FERC approval under the Federal Power Act or the nature of any state regulatory approval requirements. Idaho Power is unable to predict under what other circumstances the Exchange might be terminated and abandoned.
EFFECTIVE DATE OF THE EXCHANGE
It is expected that the effective date of the Exchange will occur as soon as practicable after the required approval by shareholders of Idaho Power and the receipt of necessary regulatory approvals under applicable law. Idaho Power cannot predict when such approvals will be received. See "--Regulatory Approvals" below. Idaho Power is hopeful that the Exchange will occur in the second half of 1998.
EXCHANGE OF STOCK CERTIFICATES NOT REQUIRED
If the Exchange takes place, it will not be necessary for holders of Idaho Power Common Stock to physically exchange their existing stock certificates for stock certificates of IDACORP. The holders of Idaho Power Common Stock will become the owners of shares of IDACORP Common Stock on a share-for-share basis, and the present stock certificates of Idaho Power will automatically represent shares of IDACORP Common Stock. After the Exchange, as presently outstanding certificates of Idaho Power Common Stock are presented for transfer, new certificates bearing the IDACORP name will be issued.
CERTAIN CONSIDERATIONS
The Board of Directors of Idaho Power believes that the formation of a holding company is in the best interests of the shareholders of Idaho Power. Nevertheless, the future performance of IDACORP Common Stock cannot be guaranteed.
For a period of time following the Exchange, the funds required by IDACORP to enable it to pay dividends on shares of IDACORP Common Stock are expected to be derived predominantly from the dividends paid to IDACORP by Idaho Power. Accordingly, the ability of IDACORP to pay dividends to its shareholders, as a practical matter, will be governed by the ability of Idaho Power to pay dividends on its common stock held by IDACORP. The ability of Idaho Power to pay dividends on its common stock will continue to be subject to the preferential dividend rights of the holders of the Idaho Power Preferred Stock. In addition, although it has no present intention to do so, it is expected that Idaho Power may need to issue additional preferred stock in the future to meet its capital requirements. Such additional preferred stock will also have preferential dividend rights. The Board of Directors of IDACORP has no current intention to change the current dividend policy of Idaho Power.
The IDACORP Subsidiaries may encounter competitive and other factors not previously experienced by Idaho Power and may have different, and perhaps greater, investment risks than those involved in the regulated utility business of Idaho Power. There can be no assurance that such businesses will be successful or, if unsuccessful, that they will not have a direct or indirect adverse effect on IDACORP. Any losses incurred by such businesses may not be recoverable in the utility rates of Idaho Power.
The business activities of the IDACORP Subsidiaries, and the assets employed in connection therewith, will not be available to the holders of the Idaho Power Preferred Stock as a source of cash for the payment of dividends or other amounts. The Idaho Power Preferred Stock will continue to have priority over the shares of Idaho Power Common Stock as to the payment of dividends and upon any liquidation, and will be on a parity with any additional preferred stock that may be issued by Idaho Power.
IDACORP will obtain funds to invest in the IDACORP Subsidiaries from dividends IDACORP receives on its Idaho Power Common Stock, borrowings or the issuance of additional securities by IDACORP and any dividends it may in the future receive from any earnings of the IDACORP Subsidiaries, although there can be no assurance that the IDACORP Subsidiaries will have any earnings, or pay any dividends to IDACORP, in the foreseeable future.
REGULATORY APPROVALS
As a utility, Idaho Power is under the regulatory jurisdiction (as to rates, service, accounting and other general matters of utility operation) of the FERC, the IPUC, the OPUC and the Public Service Commission of Nevada. The Company is also under the regulatory jurisdiction of the IPUC, OPUC and the Public Service Commission of Wyoming as to the issuance of securities. The Company is subject to the provisions of the Federal Power Act as a "licensee" and "public utility" as therein defined. The Company's retail rates are established under the jurisdiction of the state regulatory agencies and its wholesale and transmission rates are regulated by the FERC. The formation of a holding company will not change the applicability of such regulatory jurisdictions to Idaho Power.
Receipt of orders from the FERC under the Federal Power Act and state regulatory approvals, in forms satisfactory to Idaho Power, are conditions precedent to consummation of the Exchange. The Company has received orders from the state public utility commissions of Idaho and Oregon.
IDACORP believes that, after the formation of the holding company, it will be entitled to an exemption from all provisions of the Public Utility Holding Company Act of 1935 (the "Holding Company Act"), except Section 9(a)(2). Section 9(a)(2) requires prior approval of the SEC for certain utility acquisitions. The exemption will take effect upon completion of the Exchange and the related restructuring and the filing with the SEC of an appropriate exemption statement pursuant to the provisions of the Holding Company Act. The exemption from the provisions of the Holding Company Act may be revoked on a finding by the SEC that such exemption may be detrimental to the public interest or the interest of investors or consumers.
REGULATION OF IDACORP
Upon consummation of the Exchange, IDACORP, as the owner of all the outstanding Idaho Power Common Stock, will thereby become a "holding company" under the Holding Company Act. As described above, however, it is anticipated that IDACORP will claim an exemption under the Holding Company Act and, as such, will be an exempt holding company. It will be necessary to file an annual exemption statement each year thereafter. The basis of this exemption is that both IDACORP and Idaho Power, as IDACORP's only public utility subsidiary, are incorporated in the same state (i.e., Idaho), and Idaho Power is predominantly intrastate in character and carries on its business substantially in the state of incorporation. The exemption is available only so long as the utility business of Idaho Power, and of any other public utility subsidiary from which IDACORP derives a material portion of its income, remain predominantly within Idaho. Consequently, there are limitations on the extent to which IDACORP could expand the
utility business of Idaho Power or any other material utility subsidiary outside of Idaho. In addition, prior approval of the SEC under the Holding Company Act would be required if IDACORP were to acquire, directly or indirectly, 5% or more of the voting securities of any other electric or gas utility company.
Under the Holding Company Act and current policies of the SEC, there are limitations on the extent to which exempt holding companies may diversify into businesses not functionally related to the electric and gas utility businesses. It is not anticipated that these limitations will have any significant impact on IDACORP in the foreseeable future.
The Company does not anticipate that IDACORP will be deemed to be a public utility under the state public utility codes of Idaho, Oregon, Nevada or Wyoming. However, the public utility commissions in these jurisdictions may impose restrictions on IDACORP's relationship with Idaho Power that are designed to protect utility customers.
BUSINESS OF IDACORP
Upon completion of the Exchange, IDACORP will be a holding company owning all of the outstanding shares of Idaho Power Common Stock and may engage, directly or through subsidiaries, in other businesses. For the foreseeable future, the primary focus for IDACORP will be maintaining the strength of its core business--serving Idaho Power's electric customers.
IDACORP will also own all of the outstanding securities of Ida-West. Ida-West was formed in 1989 as an independent power producer and currently holds investments in thirteen operating hydroelectric plants with a total generating capacity of approximately 72 megawatts (MW). A subsidiary of Ida-West operates and maintains ten of these plants. Ida-West owns a 50% interest in five hydroelectric projects in Idaho with a total generating capacity of 33.4 MW.
In January 1996, Ida-West made an investment by acquiring all of the outstanding bonds that were issued to finance three hydroelectric plants known collectively as the Friant Power Project. This project is located at the U.S. Bureau of Reclamation's Friant Dam on the headwaters of the San Joaquin River in Madera and Fresno Counties, California. It has an aggregate generating capacity of 27.4 MW. The project is owned and operated by Friant Power Authority, a quasi-governmental entity consisting of six irrigation districts, a water district and a municipal utility district.
In November 1996, Ida-West purchased an interest in five hydroelectric projects located in Shasta County, California, with a total generating capacity of 11.2 MW. Ida-West acquired the projects through a limited liability company in which it holds a 50 percent interest.
In addition, Ida-West has a 50% interest in the Hermiston Power Project, a 460 MW gas-fired cogeneration project to be located near Hermiston, Oregon. Ida-West has been responsible for managing all permitting and development activities relating to the project since its inception in 1993, and has obtained all permits necessary for construction and operation of the project. The partnership is exploring various alternatives for marketing the project's output.
At December 31, 1997, the Company had invested $20 million in Ida-West.
TREATMENT OF PREFERRED STOCK
Except for the exercise of Dissenters' Rights as described below, the Exchange will not result in any change in any of the outstanding Idaho Power Preferred Stock, which will remain outstanding securities of Idaho Power and will not be converted into or otherwise become a security of IDACORP.
Idaho Power Preferred Stock will continue to rank senior to Idaho Power Common Stock (all of which, after the Exchange, will be held by IDACORP) as to dividends and as to distribution of assets of Idaho Power in the event of any liquidation of Idaho Power.
Although the formation of a holding company is not expected to adversely affect the Idaho Power Preferred Stock outstanding, any growth of assets and earnings of IDACORP other than such growth of assets and earnings attributable to Idaho Power will be of no direct benefit to the holders of such stock. However, the utility operations of Idaho Power presently constitute, and are expected to continue to constitute for the foreseeable future, the predominant part of Idaho Power's consolidated assets and earnings. Accordingly, although Idaho Power is unable to predict the ultimate outcome of regulatory and other industry changes, it is believed that this transaction will not materially affect the holders of Idaho Power Preferred Stock or the investment ratings of such stock.
RIGHTS OF DISSENTING SHAREHOLDERS
The BCA provides Dissenters' Rights for the holders of shares of Idaho Power
Voting Preferred Stock who do not vote their shares in favor of the Holding
Company Proposal and who meet all of the requisite statutory requirements
contained in Sections 30-1-1321 and 30-1-1323 of the BCA. Under the BCA, any
holder of Idaho Power Voting Preferred Stock who wishes to assert Dissenters'
Rights must: (a) deliver to Idaho Power before the vote is taken written notice
of his intent to demand payment for his shares if the proposed action is
effectuated and (b) not vote his shares of Idaho Power Voting Preferred Stock in
favor of the Holding Company Proposal. If the Holding Company Proposal is
approved at the Annual Meeting,
Idaho Power is required to provide a written dissenters' notice in accordance
with the BCA to all holders of Idaho Power Voting Preferred Stock who satisfied
the above requirements. Holders of Idaho Power Voting Preferred Stock who are
sent a dissenters' notice as described above must demand payment, certify
whether they acquired beneficial ownership of the shares before the date set
forth in the dissenters' notice and, with respect to any certificated shares,
deposit such certificates in accordance with the terms of the notice. At the
effective time of the Exchange, Idaho Power will pay to such shareholders the
amount that Idaho Power estimates to be the "fair value" of such shares of Idaho
Power Voting Preferred Stock, plus accrued interest.
A shareholder who does not satisfy each of the aforementioned requirements is not entitled to payment for such shareholder's shares of Idaho Power Voting Preferred Stock under the dissenters' rights provisions of the BCA and will remain a shareholder of Idaho Power. Idaho Power may elect to withhold payment from a dissenter unless he was the beneficial owner of the shares before the date set forth in the dissenters' notice as the date of the first announcement to news media or to shareholders of the terms of the proposed corporate action. To the extent Idaho Power elects to withhold payment as set forth in the preceding sentence, after taking the proposed corporate action, it shall estimate the fair value of the shares, plus accrued interest, and shall pay this amount to each dissenter who agrees to accept it in full satisfaction of his demand.
A dissenter may notify Idaho Power in writing of his own estimate of the fair value of his shares and amount of interest due, and demand payment of his estimate, less any payment made, or reject Idaho Power's offer under Section 30-1-1327 of the BCA (relating to after-acquired shares) and demand payment of the fair value of his shares and interest due if (i) the dissenter believes that the amount paid, or offered under Section 30-1-1327, is less than the fair value of his shares or that the interest due is incorrectly calculated; (ii) Idaho Power fails to make payment within 60 days after the date set for demanding payment; or (iii) Idaho Power, having failed to take the proposed action, does not return the deposited certificates within 60 days after the date set for demanding payment. A dissenter waives his right to demand payment under this section unless he notifies Idaho Power of his demand in writing within 30 days after Idaho Power made or offered payment for his shares.
Holders of Idaho Power Common Stock, Flexible Auction Series A, Serial Preferred Stock, without par value, and 7.07% Series, Serial Preferred Stock, without par value, do not have Dissenters' Rights.
The above summary of the procedures relating to the exercise of Dissenters' Rights does not purport to be a complete statement of, and is qualified in its entirety by reference to, the provisions of Sections 30-1-1301 through 30-1-1331 of the BCA, a copy of which is attached as Exhibit D hereto and to any amendments to such sections as may be adopted after the date of this Proxy Statement and Prospectus.
DIVIDEND POLICY
While future dividends on IDACORP Common Stock will depend primarily upon the earnings, financial condition and capital requirements of its subsidiaries, principally Idaho Power, it is contemplated that IDACORP initially will make dividend payments on IDACORP Common Stock at the rate currently applicable to Idaho Power Common Stock. In addition, it is expected that such dividends of IDACORP will be declared and paid on approximately the same schedule of dates as that now followed by Idaho Power with respect to Idaho Power Common Stock dividends. The most recent dividend declared by the Board of Directors of Idaho Power was $0.465 per share of Idaho Power Common Stock and was paid on February 20, 1998.
Subject to the availability of earnings and the needs of its electric utility business, Idaho Power intends to make regular cash payments to IDACORP in the form of dividends on Idaho Power Common Stock in amounts which, to the extent not otherwise provided by IDACORP's other subsidiaries, would be sufficient for IDACORP to pay cash dividends on IDACORP Common Stock as referred to above, for operating expenses of IDACORP and for such other purposes as the Board of Directors of IDACORP may determine. Idaho Power is not a party to any agreement or subject to any laws or regulations which materially restrict the payment of dividends by it to IDACORP.
Payment of dividends on the Idaho Power Preferred Stock is anticipated to continue at the specified rates without interruption or change; provided, however, that the payment of these dividends also is dependent upon, among other things, the earnings and financial condition of Idaho Power, agreements to which Idaho Power is or may become a party and upon requirements of Idaho law.
The declaration and payment of future dividends will be at the discretion of each Board of Directors; there can be no assurances that payment of dividends will remain at current levels.
LISTING OF IDACORP COMMON STOCK
IDACORP will apply to list the IDACORP Common Stock on the NYSE and the PSE. It is expected that such listing will become effective on the effective date of the Exchange, subject to the rules of such exchanges. After the effective date of the Exchange, Idaho Power Common Stock will be delisted from trading on these stock exchanges.
UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
The following general discussion summarizes the material federal income tax consequences of the Exchange and the exercise of Dissenters' Rights and is based upon the Internal Revenue Code of 1986, as amended (the "Code"), the applicable Treasury Department regulations thereunder, judicial authority and current administrative rulings and practice, all as in effect as of the date hereof. Future legislation, regulations, administrative rulings or court decisions could significantly change such authorities either prospectively or retroactively. The following discussion does not address the consequences of the Exchange or the exercise of Dissenters' Rights under state, local or foreign law nor does the discussion address all aspects of federal income taxation that may be important to a shareholder in light of such shareholder's particular circumstances or to shareholders subject to special rules including, without limitation, foreign corporations or shareholders who are not citizens or residents of the United States, financial institutions, insurance companies, tax-exempt entities, dealers in securities or persons who acquired Idaho Power Common Stock pursuant to the exercise of an employee option (or otherwise as compensation). This discussion assumes that the shareholders hold their Idaho Power Common Stock and Idaho Power Preferred Stock as capital assets within the meaning of Section 1221 of the Code.
No ruling from the Internal Revenue Service (the "IRS") concerning the federal income tax consequences of the Exchange or the exercise of Dissenters' Rights will be requested. It is a condition to the Exchange that Idaho Power receive an opinion from LeBoeuf, Lamb, Greene & MacRae, L.L.P., to the
effect that the Exchange qualifies, for federal income tax purposes, as a tax-free transaction described under Section 351(a) of the Code. The opinion will be based upon (i) certain assumptions set forth therein and (ii) representations by the managements of Idaho Power and IDACORP. The opinion referred to above neither binds nor precludes the IRS from adopting a contrary position and no assurance can be given that contrary positions will not be successfully asserted by the IRS or adopted by a court if the issues are litigated.
THE FOLLOWING IS A SUMMARY OF CERTAIN MATERIAL FEDERAL INCOME TAX CONSEQUENCES OF THE EXCHANGE AND THE EXERCISE OF DISSENTERS' RIGHTS, WITHOUT REFERENCE TO THE PARTICULAR FACTS AND CIRCUMSTANCES OF ANY PARTICULAR SHAREHOLDER. IN ADDITION, THIS DISCUSSION DOES NOT ADDRESS ANY NON-INCOME TAX OR ANY FOREIGN, STATE OR LOCAL TAX CONSEQUENCES OF THE EXCHANGE OR THE EXERCISE OF DISSENTERS' RIGHTS. THIS DISCUSSION DOES NOT ADDRESS THE TAX CONSEQUENCES OF ANY TRANSACTION OTHER THAN THE EXCHANGE AND THE EXERCISE OF DISSENTERS' RIGHTS. ACCORDINGLY, EACH SHAREHOLDER IS STRONGLY URGED TO CONSULT WITH SUCH SHAREHOLDER'S TAX ADVISOR TO DETERMINE THE PARTICULAR UNITED STATES FEDERAL, STATE, LOCAL OR FOREIGN INCOME OR OTHER TAX CONSEQUENCES OF THE EXCHANGE AND THE EXERCISE OF DISSENTERS' RIGHTS TO SUCH SHAREHOLDER.
The Exchange will be treated as a transfer of all of the outstanding Idaho Power Common Stock by the Idaho Power shareholders to IDACORP solely in exchange for all of the outstanding IDACORP Common Stock, in a tax-free exchange described under Section 351 of the Code.
TAX IMPLICATIONS TO THE HOLDERS
No gain or loss will be recognized for federal income tax purposes by holders of Idaho Power Common Stock who exchange their Idaho Power Common Stock for IDACORP Common Stock pursuant to the Exchange. The aggregate tax basis of the IDACORP Common Stock received as a result of the Exchange will be the same as the shareholder's aggregate tax basis in the Idaho Power Common Stock surrendered in the Exchange. The holding period of the IDACORP Common Stock received will include the holding period of the Idaho Power Common Stock surrendered therefor.
Idaho Power Preferred Stock will remain outstanding as preferred stock of
Idaho Power and no gain or loss will be recognized for federal income tax
purposes by holders of Idaho Power Preferred Stock as a result of the Exchange.
Holders of Idaho Power Preferred Stock who exercise Dissenters' Rights will
recognize capital gain or loss equal to the difference between the cash received
upon the exercise of Dissenters' Rights and the holder's tax basis in the Idaho
Power Preferred Stock if the payment (i) results in a "complete termination" of
the shareholder's stock interest in Idaho Power under Section 302(b)(3) of the
Code, (ii) is "substantially disproportionate" with respect to the shareholder
under Section 302(b)(2) of the Code or (iii) is "not essentially equivalent to a
dividend" with respect to the shareholder under Section 302(b)(1) of the Code.
Otherwise, the cash received will be treated as a dividend to the extent of the
current or accumulated earnings and profits of Idaho Power. Shareholders should
consult their tax advisors to determine if any cash received in connection with
their exercise of Dissenters' Rights will be characterized as a dividend under
Section 302 of the Code.
TAX IMPLICATIONS TO IDACORP
No gain or loss will be recognized by IDACORP for federal income tax purposes upon receipt of the Idaho Power Common Stock. For federal income tax purposes, the basis of the Idaho Power Common Stock received by IDACORP will be the same as Idaho Power's net asset basis immediately after the Exchange, subject to certain adjustments under Treasury Regulations relating to consolidated groups, and
IDACORP's holding period in the Idaho Power Common Stock received in the Exchange includes the period during which such stock was held by shareholders.
IDACORP CAPITALIZATION
The Restated Articles of Incorporation of IDACORP ("IDACORP Articles"), a copy of which is attached hereto as Exhibit B, provide for an authorized capitalization consisting of 120,000,000 shares of Common Stock, without par value, and 20,000,000 shares of Preferred Stock, without par value (the "IDACORP Preferred Stock").
The shares of IDACORP Common Stock for which Idaho Power Common Stock will be exchanged upon consummation of the Exchange and which will constitute all outstanding shares of IDACORP Common Stock at that time will be validly issued, fully paid and nonassessable. Each share of IDACORP Common Stock will be equal to every other share in every respect. Immediately after the Exchange, the number of shares of IDACORP Common Stock outstanding will be equal to the number of shares of Idaho Power Common Stock outstanding prior to the Exchange.
The IDACORP Preferred Stock may be issued in series. The Board of Directors of IDACORP will have the authority to determine, for any such series of preferred stock, the voting powers, designations, preferences, limitations, restrictions and relative rights thereof within the limitations set forth in the IDACORP Articles and such limitations as may be provided by law.
PAR VALUE
The IDACORP Common Stock and IDACORP Preferred Stock will not have par value. A designated par value is not required under the BCA.
CLASSIFIED BOARD
The IDACORP Articles and the IDACORP Amended Bylaws, a copy of which is attached hereto as Exhibit C (the "IDACORP Bylaws") provide: (i) that the Board shall consist of not less than nine nor more than fifteen persons who shall be elected, except as otherwise provided for in the IDACORP Bylaws, by the shareholders; (ii) for the division of the Board into three classes, which shall be as nearly equal in number as possible, with directors in each class being elected for a three-year term; (iii) that no decrease in the number of directorships shall shorten the term of any director then in office; and (iv) that no director shall be removed without cause and no director shall be removed for cause except by the affirmative vote of two-thirds of the outstanding shares entitled to vote in elections of directors.
DIVIDENDS
Subject to the prior rights, if any, of holders of IDACORP Preferred Stock or any class of stock hereafter authorized that may be issued in the future, holders of IDACORP Common Stock are entitled to receive such dividends when and as declared by the Board of Directors of IDACORP from time to time out of any tangible or intangible property legally available for this purpose.
VOTING RIGHTS
The shares of IDACORP Common Stock will entitle the holders thereof to one vote per share upon all matters upon which shareholders of IDACORP have the right to vote. Holders of IDACORP Preferred Stock will not have any right to vote except as otherwise provided by law or established by the Board of Directors of IDACORP with respect to any such series. Holders of IDACORP Common Stock will not have cumulative voting rights in the election of directors.
LIQUIDATION RIGHTS
Upon any dissolution, liquidation or winding up of IDACORP, whether voluntary or involuntary, any net assets of IDACORP available for distribution to its shareholders shall be distributed ratably to holders of IDACORP Common Stock, subject to the prior rights, if any, of holders of IDACORP Preferred Stock or any class of stock hereafter authorized.
PREEMPTIVE RIGHTS AND OTHER RIGHTS
The holders of IDACORP Common Stock have no preemptive rights. In addition, IDACORP Common Stock is not subject to redemption and does not have any conversion or sinking fund provisions.
INDEMNIFICATION AND LIMITATION OF LIABILITY
The IDACORP Articles provide that directors and officers shall be indemnified to the fullest extent permitted by applicable law. The IDACORP Articles provide that, to the fullest extent permitted by applicable law, no director shall be personally liable to IDACORP or its shareholders for monetary damages resulting from any action taken, or any failure to take any action, as a director. No amendment, modification or repeal of the liability limitation provisions shall eliminate or limit the protection afforded to a director under the IDACORP Articles with respect to any act or omission occurring prior to the effective date of such amendment, repeal or modification.
POSSIBLE ANTI-TAKEOVER EFFECTS OF CERTAIN PROVISIONS OF THE ARTICLES AND
BYLAWS OF IDACORP
Although it is not the intention of the Board of Directors to discourage legitimate offers to enhance shareholder value, the existence of unissued IDACORP Common Stock and other provisions in the IDACORP Articles and Bylaws could permit IDACORP's Board of Directors to render more difficult or to discourage a merger, tender offer, proxy contest or other transaction aimed at obtaining control of IDACORP.
NO CUMULATIVE VOTING. The IDACORP Articles do not provide for cumulative voting. The lack of cumulative voting could prevent directors from being elected by a relatively small group of shareholders.
CLASSIFIED BOARD. The classified board provisions in the IDACORP Articles could have the effect of prolonging the time required for a shareholder or shareholders with significant voting power to gain majority representation on the Board of Directors. Where majority or supermajority Board of Directors approval is important to facilitate the success of a transaction, such as an interested shareholder business combination, the inability to immediately gain a majority representation on the Board of Directors at an annual meeting of shareholders could discourage takeovers and tender offers.
ADVANCE NOTICE OF BUSINESS TO BE BROUGHT BEFORE SHAREHOLDER
MEETINGS. IDACORP Bylaws require that for nominations or other business to be properly brought before an annual meeting by a shareholder, the shareholder must give notice not earlier than 90 days nor later than 60 days prior to the first anniversary of the preceding year's annual meeting.
IDACORP Bylaws further require that business transacted at a special meeting of the shareholders be limited to the purposes set forth in the notice of the special meeting. In the event IDACORP calls a special meeting of shareholders for the purpose of electing one or more directors to the Board of Directors, any shareholder may nominate a person or persons, as the case may be, for election to such position or positions as specified in the Company's notice of meeting, if the shareholder's notice is delivered not earlier than 90 days and not later than 60 days prior to such special meeting or 10 days following the day on which public announcement is first made of the date of the special meeting.
Such advance notice requirements may delay the ability of individuals to bring before shareholder meetings matters other than those that IDACORP deems desirable and may provide sufficient time for IDACORP to institute litigation or take other appropriate steps to respond to such business, or to prevent such business from being acted upon, if such response or prevention is thought to be necessary or desirable for any reason.
"BLANK CHECK" PREFERRED STOCK. The IDACORP Articles authorize the issuance of 20,000,000 shares of IDACORP Preferred Stock. The Board of Directors has the full authority to determine the terms of any series of the IDACORP Preferred Stock. Although the IDACORP Board of Directors currently has no intention of doing so, shares of IDACORP Preferred Stock could be issued in a manner (E.G., with disproportionate or class voting rights) which could have the effect of discouraging takeover attempts.
COMPARATIVE SHAREHOLDERS' RIGHTS
GENERAL
Idaho Power and IDACORP are both Idaho corporations. When the Exchange becomes effective, holders of Idaho Power Common Stock will become holders of IDACORP Common Stock, and their rights will be governed by the IDACORP Articles and IDACORP Bylaws instead of the Idaho Power Articles and Bylaws. Copies of the IDACORP Articles and IDACORP Bylaws, each substantially in the form to be in effect immediately prior to the effective time of the Exchange, are attached as Exhibit B and Exhibit C, respectively, to this Proxy Statement and Prospectus. The Idaho Power Articles and Idaho Power Bylaws are filed as exhibits to the Registration Statement.
Certain differences and similarities between the rights of holders of IDACORP Common Stock and those of holders of Idaho Power Common Stock are summarized below. The following discussion is not intended to be a complete statement of all differences affecting the rights of shareholders, but summarizes certain material differences between the Articles and Bylaws of Idaho Power and those of IDACORP. This summary is qualified in its entirety by reference to the IDACORP Articles and IDACORP Bylaws in Exhibit B and Exhibit C hereto, respectively, the Idaho Power Articles and Idaho Power Bylaws filed as exhibits to the Registration Statement and the applicable Idaho corporate law.
1997 REVISIONS TO THE BCA
In July 1997, the State of Idaho enacted a revised BCA. The revisions to the BCA are reflected widely in the IDACORP Articles and IDACORP Bylaws. These revised BCA provisions are the basis for many of the differences between the Articles and Bylaws of Idaho Power and those of IDACORP, some of which are discussed in this section.
PURPOSE CLAUSE
The IDACORP Articles purpose clause does not limit authorized activities. IDACORP is authorized to engage in any lawful act or activity under the BCA. The Idaho Power Articles include an enumeration of permitted activities.
COMMON STOCK
IDACORP will be authorized to issue 70,000,000 more shares of common stock than Idaho Power. With the exception of the number of authorized shares and the requirement in the IDACORP Bylaws of advance notice prior to shareholders meetings, the relative rights of IDACORP Common Stock are substantially the same as the relative rights of Idaho Power Common Stock. See "--IDACORP Capitalization" above for a discussion of the authorized IDACORP Common Stock.
PREFERRED STOCK
The Board of Directors of IDACORP has full authority under the IDACORP Articles to divide the IDACORP Preferred Stock into one or more classes or series and to determine the voting rights, if any, and designations, preferences, limitations and special rights of any class or series of the IDACORP Preferred Stock. The authority of the Board of Directors to establish voting rights, preferences or other rights with respect to preferred stock may have certain anti-takeover effects. See "--IDACORP Capitalization--Possible Anti-takeover Effects of Certain Provisions of the Articles and Bylaws of IDACORP" above.
The Idaho Power Articles authorize three classes of preferred stock as follows: 215,000 shares of 4% Preferred Stock; 150,000 shares of Serial Preferred Stock, $100 par value (the "Par Value Serial Preferred Stock"); and 3,000,000 shares of Serial Preferred Stock, without par value (the "No Par Value Serial Preferred Stock"). The IDACORP Articles authorize 20,000,000 shares of preferred stock, a significantly greater number of shares than the 3,365,000 shares of preferred stock authorized under the Idaho Power Articles. The Idaho Power Articles provide the Board of Directors with the authority to fix the relative rights and preferences of each class of preferred stock, but on a more limited basis than provided in the IDACORP Articles. The Idaho Power Board has the authority to issue from time to time shares of Par Value Serial Preferred Stock and shares of No Par Value Serial Preferred Stock in series and to establish the rights and preferences of each series, subject, however, to the requirement that the shares of both the Par Value Serial Preferred Stock and No Par Value Serial Preferred Stock be on a parity with respect to dividends and liquidations with each other and the 4% Preferred Stock. After the Exchange, subject to the rights of dissenting shareholders, outstanding shares of Idaho Power Preferred Stock will continue as equity securities of Idaho Power with the same preferences, designations, relative rights, privileges and powers, and subject to the same restrictions, limitations and qualifications, as were applicable to outstanding shares of Idaho Power Preferred Stock prior to the Exchange.
PAR VALUE
The shares of Idaho Power Common Stock and two of the three classes of Idaho Power Preferred Stock have designated par values, whereas neither IDACORP Common Stock nor IDACORP Preferred Stock has par value. It is anticipated that the absence of par value in the IDACORP capital stock will not affect the market value of such stock.
BUSINESS COMBINATION PROVISIONS
There are no business combination provisions in the IDACORP Articles. Any proposed business combination would be governed by the provisions of the Idaho Business Combination Law and the Idaho Control Share Acquisition Law. See "--Certain Idaho Statutory Provisions." The Idaho Power Articles contain business combination provisions.
SPECIAL MEETINGS OF SHAREHOLDERS
The IDACORP Bylaws provide that a special meeting of shareholders may be called by the holders of twenty percent of the shares entitled to vote on any issue proposed to be considered at the special meeting. The Idaho Power Articles require that the holders of eighty percent of the shares entitled to vote at the meeting call a special meeting.
ADVANCE NOTICE PRIOR TO SHAREHOLDERS MEETING REQUIRED
The IDACORP Bylaws require shareholders to provide advance notice of any business to be brought before a shareholders meeting. The Idaho Power Articles and Bylaws, however, do not have advance notice provisions. See "--IDACORP Capitalization--Possible Anti-takeover Effects of Certain Provisions of the Articles and Bylaws of IDACORP."
CHANGES IN THE SIZE OF THE BOARD OF DIRECTORS
The designated size of the Board of Directors is established in the IDACORP Bylaws, which may be amended by a two-thirds vote of shareholders or by the affirmative vote of a majority of the Board of Directors. The designated size of the Idaho Power Board of Directors is provided in the Idaho Power Bylaws, which require an eighty percent vote of shareholders for an amendment, unless such amendment is recommended by two-thirds of the continuing directors, as defined therein.
AMENDMENT, REPEAL AND ADOPTION OF BYLAWS
Under the IDACORP Bylaws, the amendment, alteration or change of the provisions of the IDACORP Bylaws relating to the Board of Directors and advance notice prior to shareholders meetings requires the affirmative vote of two-thirds of all shares entitled to vote thereon or the affirmative vote of a majority of the Board of Directors. The Idaho Power Articles and Bylaws require an affirmative vote of the holders of eighty percent of the shares entitled to vote on an amendment in order to approve the amendment of certain provisions of the Idaho Power Bylaws, including provisions relating to the Board of Directors and business combinations, unless such amendment is recommended by two-thirds of the continuing directors, as defined therein.
RIGHTS AGREEMENT
On January 11, 1990, the Board of Directors of Idaho Power adopted a Shareowner Rights Plan (the "Rights Plan"). Under the Rights Plan, Idaho Power declared a distribution of one Preferred Stock Right (a "Right") for each outstanding share of Idaho Power Common Stock held on January 29, 1990, or issued thereafter. The Rights are currently not exercisable and will be exercisable only if a person or group (an "Acquiring Person") either acquires ownership of 20% or more of Idaho Power's voting stock or commences a tender offer that would result in the ownership of 20% or more. Idaho Power may redeem the Rights at a price of $0.01 per Right anytime prior to acquisition by an Acquiring Person of a 20% position. Following the acquisition by an Acquiring Person of a 20% position, each Right will entitle its holder (other than such person or members of such group), subject to regulatory approval, to purchase for $85 that number of shares of Idaho Power Common Stock and/or at the election of Idaho Power, Idaho Power Preferred Stock having a market value of $170. If after the Rights become exercisable, Idaho Power is acquired in a merger or other business combination, 50% or more of its consolidated assets or earning power are sold or the Acquiring Person engages in certain acts of self-dealing, each Right entitles the holder to purchase for $85 shares of the acquiring company's common stock having a market value of $170. Any Rights that are or were held by an Acquiring Person become void if any of these events occurs. The Rights expire on January 11, 2000. The Rights Plan has been amended so that it will not be triggered by the Exchange. Prior to the Effective Time of the Exchange, it is anticipated that IDACORP will enter into a rights agreement similar to the one described above.
CERTAIN IDAHO STATUTORY PROVISIONS
The Company is subject to the Idaho Control Share Acquisition Law (the "CSAL"), which is designed to protect minority shareholders in the event that a person acquires or proposes to acquire, directly or indirectly, by tender offer or otherwise, shares giving it at least 20%, at least 33 1/3%, or more than 50% of the voting power in the election of directors (such an acquisition, a "Control Share Acquisition"). IDACORP will be subject to the CSAL upon completion of the Exchange. The CSAL is applicable to a publicly held Idaho corporation which has at least 50 shareholders, such as the Company, unless a provision in its articles of incorporation or bylaws, adopted in accordance with the CSAL, makes an express election not to be subject to the CSAL. There are no such provisions in the Idaho Power or IDACORP Articles or Bylaws.
Under the CSAL, an acquiring person is required to deliver to the corporation an information statement disclosing, among other things, the identity of the person, the terms of the acquisition or proposed acquisition, and the financing thereof. An acquiring person will not be able to vote those shares acquired in a Control Share Acquisition that exceed one of the cited thresholds (such shares, "Control Shares") unless a resolution approved by 66 2/3% of the voting power of all shares entitled to vote thereon (excluding shares with respect to which voting power can be exercised by the acquiring person or an officer or director of the corporation) approves of such voting power. At the request of the acquiring person, such a resolution must be put forth before shareholders at a special meeting held within 55 days after receipt of the information statement, provided that the acquiring person undertakes to pay the costs of such special meeting and has delivered to the corporation copies of definitive financing agreements with responsible entities for any required financing of the Control Share Acquisition. If an information statement has not been delivered to the corporation by the 10th day after a Control Share Acquisition, or the shareholders of the corporation have voted not to accord voting rights to the Control Shares, the corporation may redeem all (but not less than all) of the Control Shares at their fair market value. Shares that are not accorded voting rights pursuant to the CSAL regain their voting rights when acquired by another person in an acquisition that is not subject to the CSAL.
The Company also is subject to the Idaho Business Combination Law (the "BCL"), which prohibits a corporation from engaging in certain business combinations with an "interested shareholder" for a period of three years after the date of the transaction in which the person became an interested shareholder, unless, among other things, (i) the corporation's articles of incorporation or bylaws include a provision that was adopted in accordance with the BCL and that expressly provides that the corporation is not subject to the statute (the Company has not made such an election), or (ii) a committee of the corporation's board of directors approves of the business combination or the acquisition of the shares before the date such shares were acquired. After the three year moratorium period, the corporation may not consummate a business combination unless, among other things, it is approved by the affirmative vote of the holders of at least two-thirds of the outstanding shares entitled to vote (other than those beneficially owned by the interested shareholder or an affiliate or associate thereof) or the business combination meets certain minimum price and form of payment requirements. An interested shareholder is defined to include, with certain exceptions, any person who is the beneficial owner of 10% or more of the voting power of the outstanding voting shares of the corporation. Business combinations subject to the BCL include certain mergers, consolidations, recapitalizations and reverse share splits. IDACORP also will be subject to the BCL upon completion of the Exchange.
The application of the CSAL and the BCL may have the effect of delaying, deferring or preventing a change of control of the Company or IDACORP.
DIRECTORS AND MANAGEMENT
The current directors of Idaho Power will be the directors of IDACORP at the effective time of the Exchange. They will be elected to serve as directors of IDACORP for the same terms of service for which they are currently serving as directors of Idaho Power.
Upon effectiveness of the Exchange, IDACORP's executive officers are expected to be:
Joseph W. Marshall Chairman and Chief Executive Officer
Jan B. Packwood President and Chief Operating Officer
J. LaMont Keen Vice President, Chief Financial Officer
and Treasurer
Robert W. Stahman Vice President, General Counsel and
Secretary
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These executive officers of IDACORP will continue to be executive officers of Idaho Power.
Certain information concerning the executive officers of Idaho Power is incorporated herein by reference from the Company's latest Annual Report on Form 10-K.
DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
At the effective time of the Exchange, IDACORP will assume Idaho Power's existing Dividend Reinvestment and Stock Purchase Plan as in effect immediately prior to the effective time. Shares of Idaho Power Common Stock held in the plan will automatically become a like number of shares of IDACORP Common Stock, and shares of IDACORP Common Stock will be issued and delivered under the plan on and after the effective time.
COMMON STOCK PLANS
At the effective time of the Exchange, shares of Idaho Power Common Stock held under Idaho Power's 1994 Restricted Stock Plan and the Employee Savings Plan (401(k) Plan) will automatically become a like number of shares of IDACORP Common Stock, and shares of IDACORP Common Stock will be issued and delivered under such plans on and after the effective time.
Shareholder approval of the Holding Company Proposal will also constitute shareholder approval or ratification of the actions to be taken in connection with the 1994 Restricted Stock Plan, including the adoption or assumption of the 1994 Restricted Stock Plan by IDACORP and the adoption of any amendments to the 1994 Restricted Stock Plan necessary to accomplish those actions.
MARKET PRICE OF IDAHO POWER COMMON STOCK
On March 10, 1998, the high and low sales prices for Idaho Power Common Stock, as reported in the consolidated transaction reporting system, were $36 1/8 and $35 5/8 , respectively.
TRANSFER AGENT AND REGISTRAR
First Security Bank of Idaho is expected to act as Registrar, and IDACORP and The Bank of New York are expected to act as Transfer Agents for IDACORP Common Stock once the Exchange is consummated.
The Board of Directors of Idaho Power has unanimously approved the Holding Company Proposal and believes that it is in the best interests of Idaho Power's shareholders.
THE BOARD OF DIRECTORS OF IDAHO POWER RECOMMENDS APPROVAL AND ADOPTION OF, AND URGES EACH SHAREHOLDER TO VOTE "FOR", THE HOLDING COMPANY PROPOSAL AS DISCUSSED IN PROPOSAL NO. 2.
PROPOSAL NO. 3--RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITOR
At the meeting, the shareholders will be asked to ratify the selection by the Board of Directors of Deloitte & Touche LLP as the firm of independent public accountants to audit the financial statements of the Company for the fiscal year 1998. This firm has conducted consolidated annual audits of the Company for many years and is one of the world's largest firms of independent certified public accountants. A representative of Deloitte & Touche LLP is expected to be present at the meeting and will have an opportunity to make a statement and to respond to appropriate questions.
THE BOARD OF DIRECTORS OF IDAHO POWER RECOMMENDS A VOTE "FOR" DELOITTE &
TOUCHE LLP AS INDEPENDENT AUDITOR.
SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth the number of shares beneficially owned on January 30, 1998, by the Directors and nominees, by those Executive Officers named in the Summary Compensation Table and by the Directors and Executive Officers of the Company as a group:
AMOUNT OF
NAME OF BENEFICIAL PERCENT
TITLE OF CLASS BENEFICIAL OWNER OWNERSHIP(1) OF CLASS
------------------- -------------------------------------------------------------------- ------------ -------------
Common Stock Robert D. Bolinder.................................................. 1,000 *
Common Stock Roger L. Breezley................................................... 650 *
Common Stock John B. Carley...................................................... 2,805 *
Common Stock Larry R. Gunnoe..................................................... 27,944 *
Common Stock Peter T. Johnson.................................................... 2,000 *
Common Stock Jack K. Lemley...................................................... 1,500 *
Common Stock Evelyn Loveless..................................................... 1,325 *
Common Stock Joseph W. Marshall.................................................. 36,159 *
Common Stock Jon H. Miller....................................................... 500 *
Common Stock Peter S. O'Neill.................................................... 500 *
Common Stock Jan B. Packwood..................................................... 19,200 *
Common Stock Gene C. Rose........................................................ 2,423 *
Common Stock Phil Soulen......................................................... 5,771 *
Common Stock Douglas H. Jackson.................................................. 24,343 *
Common Stock J. LaMont Keen...................................................... 10,437 *
Common Stock Richard R. Riazzi................................................... 3,113 *
Common Stock All Directors and Executive Officers as a group (20 persons)........ 178,435 *
Preferred Stock All Directors and Executive Officers as a group (20 persons)........ 27 *
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* Less than 1 percent.
(1) Includes shares of Common Stock subject to forfeiture issued pursuant to the 1994 Restricted Stock Plan.
All Directors and Executive Officers have voting and investment power for the shares held by them including shares owned through the Employee Savings Plan and the Dividend Reinvestment and Stock Purchase Plan.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based solely upon a review of Company records and copies of reports on Forms 3, 4 and 5 furnished to the Company or written representations that no reports on Form 5 were required, the Company believes that during 1997 all persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act of 1934, as amended, filed the required reports on a timely basis, except J.C. Miller and Kip W. Runyan for whom Initial Statements of Beneficial Ownership on Form 3 were filed late and J. LaMont Keen for whom a Form 4 was filed late.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
REPORT OF COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS ON EXECUTIVE
COMPENSATION
GENERAL
The Compensation Committee (Committee) of the Board of Directors administers the Company's executive compensation program. As such, the Committee is responsible for recommending (1) the
compensation philosophy, (2) executive compensation plans that support the philosophy, and (3) the appropriate levels of compensation for Executive Officers. The Committee is composed of four independent, non-employee Directors. Following the development of recommendations by the Compensation Committee, all issues related to executive compensation are submitted to the full Board of Directors for approval. The Board approved, without modification, all executive compensation recommendations of the Committee for 1997.
EXECUTIVE OFFICER COMPENSATION PHILOSOPHY
The compensation philosophy for Executive Officers is consistent with the compensation philosophy the Company has adopted for all employees. The Company's compensation program is designed to:
1. manage employee compensation as an investment with the expectation employees will contribute to the Company's financial performance, its environmental record and public reputation in the territory it serves;
2. be competitive with respect to those companies in the markets in which the Company competes for employees, allowing the Company to successfully attract and retain the qualified employees necessary for long-term success;
3. recognize individuals for their demonstrated ability to perform their position responsibilities; and
4. balance total compensation with the Company's ability to pay.
EXECUTIVE OFFICER 1997 COMPENSATION
Salary ranges for Executive Officers are reviewed annually and are supported by salary comparisons with similar positions in electric utilities throughout the United States with annual revenues ranging from $500 million to $700 million. The competitive point for executive compensation for 1997 was targeted near the median of the salary levels for executive officers of these utilities. Actual compensation of individual Executive Officers is based upon their levels of responsibility, experience in their positions, prior experience, breadth of knowledge and job performance. The electric utility group utilized by the Committee to compare Executive Officer salaries is different from the EEI 100 Electric Utilities Index group utilized by the Company to compare the financial performance of the Company with a nationally recognized industry standard. The Committee has used this smaller electric group for salary comparison purposes since November 1994, based on its belief that it is more appropriate to compare Executive Officer salaries with electric utilities of comparable revenues, size and complexity than with all electric utilities regardless of size as represented in the EEI Electric Utilities Index.
In November of 1996, the Committee recommended adjustments to the 1997 salary ranges for the Executive Officer group based on the annual Executive Officer compensation review referenced above. Salary adjustments for 1997 averaged approximately 6 percent, to move them nearer (but slightly below) the median of the comparison group. The Committee considered each of the factors discussed above but did not assign a formal weighting for each factor.
The Company's Executive Annual Incentive Plan implemented on January 1, 1995 that tied a portion of each executive's compensation to achieving annual operational and financial goals was suspended for 1997. Effective January 1, 1997, the executive officers participated in the Company's Employee Incentive Plan ("EIP"). The objectives of the EIP are to (1) allow employees to participate with shareholders in the Company's success, (2) focus attention on the achievement of sustained growth in earnings, (3) promote and reinforce a sense of individual ownership and personal accountability for the Company's success, (4) strengthen understanding and commitment to key business strategies and goals, and (5) unify employee efforts toward accomplishing business strategies and goals. Under the EIP, the total Company award equals 40 percent times the increase in the Company's earnings on common stock over the average of the
previous three years. The total Company award is converted to an individual award amount by dividing the total Company award by the total compensation expense (base pay plus overtime) for the Company for 1997. The same percentage payout applies to all employees including Executive Officers. The maximum individual award percentage payout under the EIP is 15 percent of base pay. In 1997, the Company achieved a level of performance under the EIP that will result in all Executive Officers receiving an award of approximately 7.8 percent of their individual base salaries. Awards under the Executive Annual Incentive Plan are reflected in the bonus column of the Summary Compensation Table.
The 1994 Restricted Stock Plan ("Restricted Stock Plan"), approved by shareholders at the May 1994 Annual Meeting, was implemented in January 1995 as an equity-based long-term incentive plan. Restricted Stock grants made in January 1995 for the 1995-1997 restricted period were earned at the maximum level for all named executive officers, based on achieving the Cumulative Earnings Per Share ("CEPS") goal at the maximum level. A grant under the Restricted Stock Plan was made to all officers in January 1997, with a three-year restricted period ending December 31, 1999, with a single financial performance goal of CEPS. To receive a final share award each officer must be employed by the Company, as an officer, during the entire restricted period (with certain exceptions), and the Company must achieve the CEPS performance goal established by the Board of Directors. The restricted stock grant percentage (a percentage of base salary converted into shares of stock based upon the closing stock price for a share of Company common stock on December 31, 1996) varied by position with the percentages for the Chief Executive Officer and the President and Chief Operating Officer ranging from a minimum of 15 percent to a maximum of 45 percent. For the next tier of executive officers, the percentage ranges from a minimum of 12 percent to a maximum of 36 percent. For the next tier of executive officers, the percentage ranges from a minimum of 9 percent to a maximum of 27 percent. The target grant percentages for new grants are reviewed annually as part of the annual Executive Officer compensation review referenced above and the 1997 grants were at a level below the median target levels among the comparison group.
The Company has no policy regarding the deductibility of qualifying compensation paid to Executive Officers under Section 162(m) of the Internal Revenue Code.
CEO 1997 COMPENSATION
In January of 1997, Mr. Marshall, who has served as Chief Executive Officer since 1989, was granted a salary increase of approximately 5 percent. The competitiveness of Mr. Marshall's salary is reviewed annually based upon comparisons with salaries of chief executive officers of comparable utilities with annual revenues ranging from $500 million to $700 million. The competitive point for Mr. Marshall's salary is targeted near the median of this comparison. The actual 1997 salary adjustment for Mr. Marshall is based on the level of his responsibilities, the depth of his experience, his job performance and the overall competitive level of his current compensation based on the annual Executive Officer compensation review referenced above and was near the median of salary levels for chief executive officers of the comparison utility group. The Committee considered each of these factors but did not assign a formal weighting for each factor. Mr. Marshall is a participant in the EIP, as described above. In 1997, the Company achieved a level of performance under the EIP that will result in Mr. Marshall receiving an award of approximately 7.8 percent of his base salary. In addition Mr. Marshall is a participant in the Restricted Stock Plan as discussed above and earned his restricted stock grant made in January 1995 for the 1995-1997 restricted period at the maximum level, based on achieving the CEPS goal at the maximum level. This resulted in a final award of 27 percent of Mr. Marshall's base salary at the time of grant. Mr. Marshall received a new stock grant at the target level of 24 percent in 1997 and will receive a final share award after the restricted period ends if he remains employed by the Company as an officer during the entire restricted period and the Company achieves its CEPS performance goal established by the Board of Directors.
John B. Carley, Chairman Evelyn Loveless Peter T. Johnson Peter S. O'Neill |
SUMMARY COMPENSATION TABLE
LONG-TERM
COMPENSATION
-------------
AWARDS
ANNUAL -------------
COMPENSATION RESTRICTED ALL OTHER
-------------------- STOCK COMPENSATION(2)
NAME AND SALARY BONUS AWARD(S)(1) -----------------
PRINCIPAL POSITION YEAR ($) ($) ($) ($)
---------------------------------------------------- --------- --------- --------- ------------- -----------------
Joseph W. Marshall 1997 420,000 32,760 126,000 6,400
Chairman of the Board 1996 400,000 56,990 96,000 6,000
and Chief Executive 1995 375,000 73,125 69,090 6,000
Officer
Larry R. Gunnoe 1997 284,000 22,152 85,200 6,400
Retired President and 1996 270,000 38,470 64,800 6,000
Chief Operating Officer(3) 1995 240,000 46,800 43,710 6,000
Jan B. Packwood 1997 207,692 16,200 56,000 5,873
President and 1996 182,000 25,049 30,600 6,000
Chief Operating Officer 1995 155,000 30,225 18,330 6,000
Douglas H. Jackson 1997 175,000 13,650 49,000 6,192
Vice President- 1996 170,000 24,222 30,600 5,449
Corporate Affairs 1995 155,000 30,225 18,330 6,000
J. LaMont Keen 1997 178,000 13,884 49,840 6,400
Vice President, 1996 170,000 24,222 30,600 6,000
Chief Financial Officer 1995 152,000 29,640 18,330 6,000
and Treasurer
Richard R. Riazzi 1997 181,450 14,153 64,640 --
Vice President- 1996 -- -- -- --
Marketing and 1995 -- -- -- --
Sales
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(1) Aggregate restricted stock holdings as of December 31, 1997 are as follows:
Mr. Marshall held 10,188 ($383,323.50) shares of restricted stock; Mr.
Gunnoe held 6,757 ($254,232.13) shares of restricted stock; Mr. Packwood
held 3,599 ($135,412.38) shares of restricted stock; Mr. Jackson held 3,374
($126,946.75) shares of restricted stock; Mr. Keen held 3,401 ($127,962.63)
shares of restricted stock; and Mr. Riazzi held 1,718 ($64,640) shares of
restricted stock. Dividends are paid on restricted stock when and as paid on
the Company's Common Stock.
(2) Represents the Company's contribution to the Employee Savings Plan (401-k plan).
(3) Mr. Gunnoe retired from his position as President and Chief Operating Officer during 1997.
LONG-TERM INCENTIVE PLANS--AWARDS IN LAST FISCAL YEAR
NUMBER OF PERFORMANCE OR
SHARES, UNITS OTHER PERIOD UNTIL
NAME OR OTHER RIGHTS(1) MATURATION OR PAYOUT
------------------------------------------------------------------------- ------------------- --------------------
Richard R. Riazzi 3918 1997-1999
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(1) The phantom stock was awarded to Mr. Riazzi on January 1, 1997 pursuant to his Employment Agreement. Dividend equivalents will accrue as additional phantom shares during the three year period. If Mr. Riazzi remains employed by the Company on December 31, 1999, he will be paid the cash value of the phantom stock on that date.
DIRECTOR COMPENSATION
Directors who are not employees of the Company receive $800 for each Board meeting and for each committee meeting attended. In addition, non-employee Directors who are chairmen of Board committees receive $1,820 per month; other non-employee Directors receive $1,650 per month. The Company permits Directors to defer all or a portion of any retainers and meeting fees under a deferred compensation plan. Under the plan, at retirement Directors may receive one lump-sum payment of all amounts deferred with interest, or a series of up to 10 equal annual payments, depending upon the specific deferral arrangement. A special account is maintained on the Company's books showing the amounts deferred and the interest accrued thereon. The Directors participate in a non-qualified deferred compensation plan (a non-qualified defined benefit plan for Directors) that is financed by life insurance on the participants and provides, upon retirement from the Board, for the payment of $17,500 per year for a period of 15 years.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation Committee for 1997 were John B. Carley, Peter T. Johnson, Evelyn Loveless and Peter S. O'Neill. O'Neill Enterprises, of which Mr. O'Neill is President, is the developer of the Surprise Valley Partnership developing a residential community in southeast Boise. In May of 1995, the Company entered into an agreement leasing approximately 48.21 acres to Surprise Valley Partnership for 10 years at a monthly rate of $1,118.75. The lease payments were based on an 8 percent return on fair market value with the fair market value of the leased land determined by independent appraisers. The Company's appraisal was provided by Nelson & Hastings, Real Estate Appraisers and Consultants, with Brad Janoush Appraisal M.A.I. providing the appraisal for Surprise Valley Partnership.
EMPLOYMENT CONTRACTS
The Company has entered into an employment agreement with Richard R. Riazzi, Vice President-- Marketing and Sales, for a three-year term ending December 1999, with automatic one year extensions thereafter unless the parties agree to terminate. The agreement provides for a minimum base salary of $191,000 per year subject to annual review, a phantom stock award (shown in the Long-Term Incentive Plans Table), plus annual and long-term incentive compensation opportunities. In the event of termination of employment following a change of control of the Company, which is defined as the acquisition of beneficial ownership of 20% of voting power of the Company, certain changes in the Company's Board, or approval by the shareholders of the liquidation of the Company, of certain merger or consolidations or of certain transfers of the Company's assets, Mr. Riazzi will receive 18 months base salary plus the greater of two times the most recent annual bonus or two times the average annual bonus for the three previous years, subject to any limitations provided by Section 280G of the Internal Revenue Code.
PERFORMANCE GRAPH
[GRAPH]
Source: ZACKS INVESTMENT RESEARCH, INC. and EDISON ELECTRIC INSTITUTE
The table shows a Comparison of Five-Year Cumulative Total Shareholder Return for Idaho Power Company Common Stock, the S&P 500 Index and the Edison Electric Institute (EEI) 100 Electric Utilities Index. The data assumes that $100 was invested on December 31, 1992, with beginning-of-period weighting of the peer group indices (based on market capitalization) and monthly compounding of returns.
EEI 100
ELECTRIC
IDAHO POWER S&P 500 UTILITIES
----------- --------- ---------------
1992................................................ $ 100.00 $ 100.00 $ 100.00
1993................................................ 117.38 110.08 111.15
1994................................................ 97.62 111.53 98.29
1995................................................ 134.11 153.45 128.78
1996................................................ 147.92 188.68 130.32
1997................................................ 189.73 251.63 166.00
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RETIREMENT BENEFITS
The following table sets forth the estimated annual retirement benefits payable under the Company's Retirement Plan (a qualified defined benefit pension plan for all regular employees) and under the Company's Security Plan for Senior Management Employees (a non-qualified defined benefit plan for senior management employees).
PENSION PLAN TABLE
YEARS OF SERVICE
----------------------------------------------------------------------
REMUNERATION 15 20 25 30 35 40
------------------------------------------------- ---------- ---------- ---------- ---------- ---------- ----------
$ 75,000......................................... $ 45,000 $ 48,750 $ 52,500 $ 56,250 $ 56,250 $ 56,250
$100,000......................................... $ 60,000 $ 65,000 $ 70,000 $ 75,000 $ 75,000 $ 75,000
$125,000......................................... $ 75,000 $ 81,250 $ 87,500 $ 93,750 $ 93,750 $ 93,750
$150,000......................................... $ 90,000 $ 97,500 $ 105,000 $ 112,500 $ 112,500 $ 112,500
$175,000......................................... $ 105,000 $ 113,750 $ 122,500 $ 131,250 $ 131,250 $ 131,250
$200,000......................................... $ 120,000 $ 130,000 $ 140,000 $ 150,000 $ 150,000 $ 150,000
$225,000......................................... $ 135,000 $ 146,250 $ 157,500 $ 168,750 $ 168,750 $ 168,750
$250,000......................................... $ 150,000 $ 162,500 $ 175,000 $ 187,500 $ 187,500 $ 187,500
$275,000......................................... $ 165,000 $ 178,750 $ 192,500 $ 206,250 $ 206,250 $ 206,250
$300,000......................................... $ 180,000 $ 195,000 $ 210,000 $ 225,000 $ 225,000 $ 225,000
$325,000......................................... $ 195,000 $ 211,250 $ 227,500 $ 243,750 $ 243,750 $ 243,750
$350,000......................................... $ 210,000 $ 227,500 $ 245,000 $ 262,500 $ 262,500 $ 262,500
$375,000......................................... $ 225,000 $ 243,750 $ 262,500 $ 281,250 $ 281,250 $ 281,250
$400,000......................................... $ 240,000 $ 260,000 $ 280,000 $ 300,000 $ 300,000 $ 300,000
$450,000......................................... $ 270,000 $ 292,500 $ 315,000 $ 337,500 $ 337,500 $ 337,500
$500,000......................................... $ 300,000 $ 325,000 $ 350,000 $ 375,000 $ 375,000 $ 375,000
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Benefits under the Retirement Plan for senior management employees at normal retirement age are calculated on years of credited service using the average of the highest five consecutive years' salary plus bonus (as reported in the Summary Compensation Table) in the last 10 years before retirement. Benefits under the Security Plan for Senior Management Employees are based upon a similar average of the highest five consecutive years of salary plus bonus in the last 10 years before retirement, a normal retirement age of 62 years, years of participation as a senior management employee, and are payable over the participant's lifetime. Generally, total retirement benefits from the Retirement Plan and Security Plan for Senior Management Employees will range from 60 percent to 75 percent of the participant's average salary plus bonus in the highest five consecutive years in the last 10 years of employment. The Security Plan is financed by life insurance on the participants and is designed so that if assumptions made as to mortality expectation, policy dividends and other factors are realized, the Company will recover the cost of this plan. Effective August 1, 1996, the Company terminated its Supplemental Employee Retirement Plan (a non-qualified plan that provided benefits that would otherwise have been denied participants by reason of certain Internal Revenue Code limitations on qualified plan benefits). Benefits payable from the Retirement Plan and the Security Plan are included in the table above. Benefits shown above are not subject to any deduction for Social Security benefits or other offset amounts.
As of December 31, 1997, the final five-year average salary plus bonus under the retirement plans as referred to above for the Executive Officers named in the Summary Compensation Table are: Mr. Marshall, $395,459; Mr. Gunnoe, $255,123; Mr. Packwood, $174,227; Mr. Jackson, $164,800; and Mr. Keen, $163,283. Years of credited service under the Retirement Plan and years of participation as a senior management employee are, respectively: Mr. Marshall, 28, 21; Mr. Gunnoe, 29, 22; Mr. Packwood, 28, 21; Mr. Jackson, 41, 21; and Mr. Keen, 24, 15. Mr. Riazzi has one year of credited service but has not vested in the plan.
EXPERTS
The consolidated financial statements and the related consolidated financial statement schedule incorporated in this Proxy Statement and Prospectus by reference from the Company's Annual Report on Form 10-K for the year ended December 31, 1997 have been audited by Deloitte & Touche LLP, independent auditors, as stated in their report, which is incorporated herein by reference, and have been so incorporated in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.
LEGAL OPINIONS
The validity of the shares of IDACORP Common Stock to be issued pursuant to the Exchange will be passed upon by Robert W. Stahman, Vice President, General Counsel and Secretary of Idaho Power and by LeBoeuf, Lamb, Greene & MacRae, L.L.P. LeBoeuf, Lamb, Greene & MacRae, L.L.P. may rely upon the opinion of Mr. Stahman as to matters of Idaho law. As of January 30, 1998, Mr. Stahman owned 17,083 shares of Company Common Stock. Mr. Stahman is acquiring additional shares of Common Stock at regular intervals through the Employee Savings Plan.
OTHER BUSINESS
Neither the Board of Directors nor management intends to bring before the meeting any business other than the matters referred to in the Notice of Meeting and this Proxy Statement and Prospectus. In addition, they have not been informed that any other matter will be presented to the meeting by others. If any other business should properly come before the meeting, or any adjournment thereof, the persons named in the proxy will vote on such matters according to their best judgment.
At the meeting, management will report on the Company's business, and shareholders will have an opportunity to ask questions.
1999 ANNUAL MEETING OF SHAREHOLDERS
Nominations for Director may be made only by the Board of Directors or by a shareholder entitled to vote who has delivered written notice to the Secretary of the Company not earlier than 90 days, and not later than 60 days, prior to the Company's annual meeting.
No business may be brought before an annual meeting of the shareholders except as specified in the notice of the meeting or as otherwise properly brought before the meeting by or at the direction of the Board or by a shareholder entitled to vote who has delivered written notice to the Secretary of the Company not earlier than 90 days, and not later than 60 days, prior to the Company's annual meeting. If the Exchange is effective prior to the 1999 Annual Meeting of the Company, any nomination or proposal that a common shareholder intends to present for action at the Company's 1999 Annual Meeting will be considered for IDACORP's 1999 Annual Meeting.
These requirements are separate and apart from and in addition to the Securities and Exchange Commission's requirements that a shareholder must meet in order to have a shareholder proposal included in the Company's Proxy Statement under Rule 14a-8 of the Exchange Act. For purposes of the Company's Annual Meeting of Shareholders expected to be held on May 5, 1999, any shareholder who wishes to submit a proposal for inclusion in the Company's proxy materials must submit such proposal to the Secretary of the Company on or before November 23, 1998. If the Exchange is effective prior to the 1999 Annual Meeting of the Company, any proposal that a common shareholder submits for inclusion in the Company's 1999 Proxy Statement will be considered for IDACORP's 1999 Proxy Statement.
IT IS REQUESTED THAT EACH SHAREHOLDER WHO CANNOT ATTEND THE MEETING SEND IN
HIS OR HER PROXY OR PROXIES WITHOUT DELAY.
EXHIBIT A
AGREEMENT AND PLAN OF EXCHANGE
This AGREEMENT AND PLAN OF EXCHANGE (this "Agreement"), dated as of February 2, 1998, is between IDAHO POWER COMPANY, an Idaho corporation (the "Company"), the company whose shares will be acquired pursuant to the Exchange described herein, and IDAHO POWER HOLDING COMPANY, an Idaho corporation ("IPHC"), the acquiring company. The Company and IPHC are hereinafter referred to, collectively, as the "Companies".
WITNESSETH:
WHEREAS, the authorized capital stock of the Company consists of (a) 50,000,000 shares of Common Stock, $2.50 par value ("Company Common Stock"), of which 37,612,351 shares are issued and outstanding, (b) 215,000 shares of 4% Preferred Stock, $100 par value, of which 166,972 shares are issued and outstanding, (c) 150,000 shares of Serial Preferred Stock, $100 par value, of which 150,000 shares are issued and outstanding and (d) 3,000,000 shares of Serial Preferred Stock, without par value, of which 500,500 shares are issued and outstanding; the number of shares of Company Common Stock being subject to increase to the extent that shares reserved for issuance are issued prior to the Effective Time, as hereinafter defined.
WHEREAS, IPHC is a wholly-owned subsidiary of the Company with authorized capital stock consisting of (a) 120,000,000 shares of Common Stock, without par value ("IPHC Common Stock"), of which 100 shares are issued and outstanding and owned of record by the Company and (b) 20,000,000 shares of Preferred Stock, without par value ("IPHC Preferred Stock"), none of which shares are issued and outstanding;
WHEREAS, the Boards of Directors of the respective Companies deem it desirable and in the best interests of the Companies and the shareholders of the Company that each share of Company Common Stock be exchanged for a share of IPHC Common Stock with the result that IPHC becomes the owner of all outstanding Company Common Stock and that each holder of Company Common Stock becomes the owner of an equal number of shares of IPHC Common Stock, all on the terms and conditions hereinafter set forth; and
WHEREAS, the Boards of Directors of the Companies have each approved and adopted this Agreement and the Board of Directors of the Company has recommended that its shareholders approve this Agreement pursuant to the Idaho Business Corporation Act (the "Act");
NOW, THEREFORE, in consideration of the premises, and of the agreements, covenants and conditions hereafter contained, the parties hereto agree with respect to the exchange provided for herein (the "Exchange") that at the Effective Time (as hereinafter defined) each share of Company Common Stock issued and outstanding immediately prior to the Effective Time will be exchanged for one share of IPHC Common Stock, and that the terms and conditions of the Exchange and the method of carrying the same into effect shall be as follows:
ARTICLE I
This Agreement shall be submitted to the shareholders of the Company entitled to vote with respect thereto for approval as provided by the Act.
ARTICLE II
Subject to the satisfaction of the terms and conditions set forth in this Agreement and to the provisions of Article VI, IPHC agrees to file with the Secretary of State of the State of Idaho (the "Secretary of State") Articles of Share Exchange (the "Articles") with respect to the Exchange, and the Exchange shall take effect upon the effective date as specified in the Articles (the "Effective Time").
ARTICLE III
A. At the Effective Time: (1) each share of Company Common Stock issued and outstanding immediately prior to the Effective Time shall be automatically exchanged for one share of IPHC Common Stock, which shares shall thereupon be fully paid and non-assessable;
(2) IPHC shall acquire and become the owner and holder of each issued and outstanding share of Company Common Stock so exchanged;
(3) each share of IPHC Common Stock issued and outstanding immediately prior to the Effective Time shall be canceled and shall thereupon constitute an authorized and unissued share of IPHC Common Stock;
(4) each share of Company Common Stock held under the Dividend Reinvestment and Stock Purchase Plan, the Employee Savings Plan and the 1994 Restricted Stock Plan (including fractional and uncertificated shares) immediately prior to the Effective Time shall be automatically exchanged for a like number of shares (including fractional and uncertificated shares) of IPHC Common Stock, which shares shall be held under the Dividend Reinvestment and Stock Purchase Plan, the Employee Savings Plan and the 1994 Restricted Stock Plan, as the case may be; and
(5) the former owners of Company Common Stock shall be entitled only to receive shares of IPHC Common Stock as provided herein.
B. Subject to dissenters' rights as set forth in Part 13 of the Act for the 4% Preferred Stock, $100 par value and the Serial Preferred Stock, $100 par value, shares of the Company's 4% Preferred Stock, $100 par value, Serial Preferred Stock, $100 par value, and Serial Preferred Stock, without par value, shall not be exchanged or otherwise affected in connection with the Exchange and, to the extent issued and outstanding immediately prior to the Effective Time, shall continue to be issued and outstanding following the Exchange as shares of the Company of the applicable series designation.
C. As of the Effective Time, IPHC shall succeed to the Dividend Reinvestment and Stock Purchase Plan as in effect immediately prior to the Effective Time, and the Dividend Reinvestment and Stock Purchase Plan shall be appropriately amended to provide for the issuance and delivery of IPHC Common Stock on and after the Effective Time.
D. As of the Effective Time, the Employee Savings Plan and the 1994 Restricted Stock Plan shall be appropriately amended to provide for the issuance and delivery of IPHC Common Stock on and after the Effective Time.
ARTICLE IV
The filing of the Articles with the Secretary of State and the consummation of the Exchange are subject to the satisfaction of the following conditions precedent:
(1) the approval by the shareholders of the Company, to the extent required by the Act, of this Agreement;
(2) the approval for listing, upon official notice of issuance, by the New York Stock Exchange, of IPHC Common Stock to be issued and reserved for issuance pursuant to the Exchange;
(3) the receipt of such orders, authorizations, approvals or waivers from the Idaho Public Utilities Commission and all other regulatory bodies, boards or agencies as are required in connection with the Exchange, which orders, authorizations, approvals or waivers remain in full force and effect and do not include, in the sole judgment of the Board of Directors of the Company, unacceptable conditions; and
(4) the receipt by the Company of a tax opinion of LeBoeuf, Lamb, Greene & MacRae L.L.P. satisfactory to the Board of Directors of the Company to the effect that (a) common shareholders of the Company (i) will recognize no gain or loss in connection with the Exchange, (ii) will have the same basis in their IPHC Common Stock after the Exchange as they had in their Company Common Stock before the Exchange and (iii) will be entitled to include any period that they held Company Common Stock before the Exchange when determining any holding period with respect to IPHC Common Stock received in the Exchange and (b) IPHC will recognize no gain or loss upon its receipt of Company Common Stock in the Exchange.
ARTICLE V
Following the Effective Time, each holder of an outstanding certificate or certificates theretofore representing shares of Company Common Stock may, but shall not be required to, surrender the same to IPHC for cancellation and reissuance of a new certificate or certificates in such holder's name or for cancellation and transfer, and each holder or transferee will be entitled to receive a certificate or certificates representing the same number of shares of IPHC Common Stock as the shares of Company Common Stock previously represented by the certificate or certificates surrendered. Until so surrendered or presented for transfer, each outstanding certificate which, immediately prior to the Effective Time, represented Company Common Stock shall be deemed and treated for all corporate purposes to represent the ownership of the same number of shares of IPHC Common Stock as though such surrender or transfer and exchange had taken place. The holders of Company Common Stock at the Effective Time shall have no right to have their shares of Company Common Stock transferred on the stock transfer books of the Company, and such stock transfer books shall be deemed to be closed for this purpose at the Effective Time.
ARTICLE VI
This Agreement may be amended, modified or supplemented, or compliance with any provision or condition hereof may be waived, at any time, by the mutual consent of the Boards of Directors of the Company and of IPHC; provided, however, that no such amendment, modification, supplement or waiver shall be made or effected, if such amendment, modification, supplement or waiver would, in the judgment of the Board of Directors of the Company, materially and adversely affect the shareholders of the Company.
Notwithstanding shareholder approval of this Agreement, this Agreement may be terminated and the Exchange and related transactions abandoned at any time prior to the time the Articles are filed with the Secretary of State, if the Board of Directors of the Company determines, in its sole discretion, that consummation of the Exchange would be inadvisable or not in the best interests of the Company or its shareholders.
IN WITNESS WHEREOF, each of the Company and IPHC, pursuant to authorization and approval given by its Board of Directors, has caused this Agreement to be executed as of the date first above written.
IDAHO POWER COMPANY
By: /s/ JAN B. PACKWOOD
-----------------------------------------
Jan B. Packwood
PRESIDENT
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IDAHO POWER HOLDING COMPANY
By: /s/ JOSEPH W. MARSHALL
-----------------------------------------
Joseph W. Marshall
CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE
OFFICER
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EXHIBIT B
RESTATED ARTICLES OF INCORPORATION
OF
IDACORP, INC.
BOISE, IDAHO
, 1998
ARTICLE I
NAME
The name of the Corporation is IDACORP, Inc.
ARTICLE II
PURPOSE
The purpose for which the Corporation is organized is to engage in any lawful act or activity for which corporations may be organized under the Idaho Business Corporation Act (the "Act").
ARTICLE III
REGISTERED OFFICE AND REGISTERED AGENT
The address of the registered office of the Corporation is P.O. Box 70, 1221 West Idaho Street, Boise, Idaho 83702, and the name of the Corporation's registered agent at this address is Robert W. Stahman.
ARTICLE IV
INCORPORATOR
The incorporator of the Corporation is Robert W. Stahman, whose address is P.O. Box 70, 1221 West Idaho Street, Boise, Idaho 83702.
ARTICLE V
CAPITAL STOCK
Section 1. AUTHORIZED CAPITAL STOCK. The aggregate number of shares of all classes of capital stock which the Corporation has the authority to issue is 140,000,000, consisting of: (i) 20,000,000 shares of Preferred Stock, without par value; and (ii) 120,000,000 shares of Common Stock, without par value.
Section 2. DIVIDENDS. Subject to restrictions in these Restated Articles of Incorporation and to the extent permitted by law, the Board of Directors may declare, and the Corporation may pay, dividends from any tangible or intangible property legally available therefor. Dividends payable in shares of any class may be paid to the holders of shares of another class.
Section 3. PREFERRED STOCK. Shares of Preferred Stock may be issued in one or more series. Each series shall be so designated as to distinguish the shares thereof from the shares of all other series of the Preferred Stock and all other classes of stock of the Corporation. The Board of Directors is hereby expressly authorized to establish series of Preferred Stock and, within the limitations set forth in these Restated Articles of Incorporation and such limitations as may be provided by any applicable law, to prescribe the number of shares to be included in any series and the preferences, limitations and relative rights of each series of the Preferred Stock so established. Such action by the Board of Directors shall be expressed in a resolution or resolutions adopted by it prior to the issuance of shares of each series. Without limitation thereto, the authority of the Board of Directors with respect to each series shall include the determination of any or all of, and the shares of each series may vary from the shares of any other series in, the following:
(a) the number of shares constituting such series and the designation thereof;
(b) the rate or rates of dividend, if any, or any formula or other method or other means by which such rate or rates are to be determined at any time or from time to time, the date or dates on which dividends may be payable, whether such dividends shall be cumulative, noncumulative or partially cumulative and, if cumulative or partially cumulative, the date from which dividends shall accumulate;
(c) whether shares may be redeemed or converted (i) at the option of the
Corporation, the shareholder or another person or upon the occurrence of a
designated event; (ii) for cash, indebtedness, securities or other property;
(iii) in a designated amount or in an amount determined in accordance with a
designated formula or by reference to extrinsic data or events;
(d) the preference, if any, of shares of such series over any other class of shares with respect to distributions, including dividends and distributions upon any voluntary or involuntary dissolution, liquidation or winding up of the Corporation;
(e) whether the shares shall have any voting powers, in addition to the voting powers provided by law, and the terms of any such voting powers; and
(f) any other relative rights, preferences and limitations of that series.
All shares of the Preferred Stock of the same series shall be identical and shall have identical preferences, limitations and relative rights, except that shares of the same series issued at different times may vary as to the dates from which dividends thereon shall be cumulative and except as otherwise not prohibited by applicable law.
Section 4. COMMON STOCK.
A. LIQUIDATION RIGHTS. Subject to the limitations set forth in these Restated Articles of Incorporation, any applicable law and to the rights, if any, expressly granted to the holders of the Preferred Stock or of any class of stock hereafter authorized, upon any dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, any net assets of the Corporation available for distribution to its shareholders shall be distributed ratably to the holders of the Common Stock. Without limiting the right of the Corporation to distribute its assets or to dissolve, liquidate or wind up in connection with any sale, merger or consolidation, the sale of all or substantially all of the property of the Corporation, or the merger or consolidation of the Corporation into or with any other corporation or corporations, shall not be deemed to be a distribution of assets or a dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, for purposes of this paragraph.
B. VOTING RIGHTS. Subject to any applicable law and to the rights, if any, expressly granted to the holders of the Preferred Stock or of any class of stock hereafter authorized, the holders of the Common Stock shall have the exclusive right to vote in elections of directors and with respect to all other purposes.
ARTICLE VI
BOARD OF DIRECTORS
Section 1. NUMBER. The number of directors constituting the Board of Directors shall be determined in the Bylaws.
Section 2. TERMS. At the first Annual Meeting of Shareholders, the Board of Directors shall be divided into three classes as nearly equal in number as possible, unless otherwise provided by any applicable law. The initial term of office of each director in the first class shall expire at the first following Annual Meeting of Shareholders; the initial term of office of each director in the second class shall expire at the second following Annual Meeting of Shareholders; and the initial term of office of each director in the third class shall expire at the third following Annual Meeting of Shareholders. At each annual election commencing at the Annual Meeting of Shareholders after such classification, the successors to the class of directors whose term expires at that time shall be elected to hold office for a term of three years.
Section 3. VACANCIES. Newly created directorships resulting from any increase in the authorized number of directors or any vacancies in the Board of Directors shall be filled by a two-thirds vote of the directors then in office, or a sole remaining director, although less than a quorum. Directors chosen to fill vacancies resulting from an increase in the authorized number of directors shall hold office until the next
election of directors by the shareholders; directors chosen to fill other vacancies shall hold office for a term expiring at the Annual Meeting of Shareholders at which the term of the class to which they have been elected expires.
Section 4. REMOVAL. A director may be removed by the shareholders only for
cause at a meeting called for the purpose of removing him by the affirmative
vote of not less than two-thirds of the outstanding shares entitled to vote in
elections of directors. The meeting notice must state that the purpose, or one
(1) of the purposes, of the meeting is removal of the director.
ARTICLE VII
LIMITATION OF LIABILITY
Section 1. GENERAL. No director of the Corporation shall be personally liable to the Corporation or its shareholders for monetary damages resulting from any action taken, or any failure to take any action, as a director; provided, however, that nothing herein shall be deemed to eliminate or limit any such liability which may not be so eliminated or limited under any applicable law, as now in effect or as it may be amended or substituted from time to time.
Section 2. AMENDMENTS. No amendment, alteration, change, repeal or substitution of this Article VII shall eliminate or limit the protection afforded by this Article VII to a director with respect to any act or omission occurring prior to the effective date thereof, unless otherwise provided by any applicable law.
ARTICLE VIII
INDEMNIFICATION
Section 1. DEFINED TERMS. Capitalized terms used in this Article VIII that are defined in Section 30-1-850 of the Act shall have the meaning given to such terms under Section 30-1-850 of the Act.
Section 2. INDEMNIFICATION OF DIRECTORS AND OFFICERS. The Corporation shall indemnify its Directors and Officers against Liability and Expenses and shall advance Expenses to its Directors and Officers in connection with any Proceeding to the fullest extent permitted by the Act, as now in effect or as it may be amended or substituted from time to time.
ARTICLE IX
AMENDMENT OF RESTATED ARTICLES OF INCORPORATION
Section 1. DEFINED TERMS. For the purposes of this Article IX:
(i) "Interested Shareholder" shall have the meaning given in Section 30-1701 of the Idaho Business Combination Law; and
(ii) "Continuing Director" shall mean any member of the Board of Directors who is unaffiliated with, and not a nominee of, any Interested Shareholder and was a member of the Board of Directors prior to the time that the Interested Shareholder became an Interested Shareholder and any successor of a Continuing Director who is unaffiliated with, and not a nominee of, any Interested Shareholder and is designated to succeed a Continuing Director by two-thirds of Continuing Directors then on the Board of Directors.
Section 2. GENERAL. The Corporation reserves the right to amend, alter, change or delete any provision contained in these Restated Articles of Incorporation, in the manner now or hereafter prescribed herein or by any applicable law, and all rights conferred upon shareholders herein or as contemplated hereby are granted subject to such reservation.
Section 3. ADDITIONAL VOTING REQUIREMENTS. In addition to any affirmative vote required by any applicable law, these Restated Articles of Incorporation or otherwise, any amendment, alteration, change, repeal or substitution of, addition to, or adoption of any provision inconsistent with, Articles VI and IX of these Restated Articles of Incorporation shall require the affirmative vote of shareholders representing not less than eighty percent (80%) of the voting power of all outstanding shares of the Corporation entitled to vote in elections of directors, voting together as a single class; provided, however, that the additional affirmative votes required by this Section 3 shall not be required for any such amendment, alteration, change, repeal, substitution, addition or adoption, and such action may be taken upon such authorization and approval by shareholders as would otherwise be required, if it is recommended and submitted to the shareholders for their consideration by the affirmative vote of two-thirds of the Continuing Directors.
ARTICLE X
SHAREHOLDER VOTING AND QUORUM REQUIREMENTS
The shareholders may adopt or amend a bylaw that fixes a greater quorum or voting requirement for shareholders, or voting groups of shareholders, than is required by the Act.
EXHIBIT C
AMENDED BYLAWS
OF
IDACORP, INC.
BOISE, IDAHO
, 1998
ARTICLE I
OFFICE
Section 1.1. PRINCIPAL OFFICE. The Company shall maintain its principal office in Boise, Idaho.
Section 1.2. REGISTERED OFFICE. The Company shall maintain a registered office in the State of Idaho, as required by the Idaho Business Corporation Act (the "Act").
ARTICLE II
SHAREHOLDERS
Section 2.1. ANNUAL MEETING OF SHAREHOLDERS. An annual meeting of the shareholders shall be held on the first Wednesday of May or such other time as may be designated by the Board of Directors.
Section 2.2. SPECIAL MEETINGS. A special meeting of the shareholders may be called at any time by the President, a majority of the Board of Directors or the Chairman of the Board. A special meeting of the shareholders also may be called by the holders of not less than twenty percent (20%) of all the shares entitled to vote on any issue proposed to be considered at the proposed special meeting if such holders sign, date and deliver to the Secretary of the Company one (1) or more written demands for the meeting describing the purpose or purposes for which it is to be held. Upon receipt of one (1) or more written demands for such proposed special meeting by the holders of not less than twenty percent (20%) of all the shares entitled to vote on any issue proposed to be considered at the proposed special meeting, the Secretary of the Company shall be responsible for determining whether such demand or demands conform to the requirements of the Act, the Restated Articles of Incorporation and these Bylaws. After making an affirmative determination, the Secretary shall prepare, sign and deliver the notices required for such meeting. The shareholders' demand may suggest a time and place for the meeting but the Board of Directors shall, by resolution, determine the time and place of any such meeting.
Section 2.3. PLACE OF MEETINGS. All meetings of the shareholders shall be held at the Company's principal office or at such other place as shall be designated in the notice of such meetings.
Section 2.4. NOTICE OF SHAREHOLDERS' MEETING. Written notice of the time and place of a meeting of the shareholders shall be mailed to each shareholder entitled to receive notice under the Act: (a) not less than 10 days nor more than 60 days prior to the date of an annual or special meeting of the shareholders; or (b) if applicable, within 30 days after the date on which a shareholder demand satisfying the requirements of Section 2.2 is delivered to the Secretary of the Company. Every notice of an annual or special meeting of shareholders shall be deemed duly served when the notice is deposited in the United States mail or with a private overnight courier service, with postage prepaid and addressed to the shareholder at the shareholder's address as it appears on the Company's records or if a shareholder shall have filed with the Secretary of the Company a written request that the notice be sent to some other address, then to such other address. If an annual or special shareholders' meeting is adjourned to a different date, time or place, notice need not be given of the new date, time or place if such new date, time or place is announced at the meeting before adjournment. In any event, if a new record date for the adjourned meeting is or must be determined, notice of the adjourned meeting shall be given to persons who are shareholders as of the new record date.
Section 2.5. WAIVER OF NOTICE. Any shareholder may waive any required notice of the time, place, and purpose of any meeting of the shareholders by telegram, telecopy, confirmed facsimile, or other writing, either before or after such meeting has been held. Such waiver must be signed by the shareholder entitled to the notice and be delivered to the Company for inclusion in the minutes or filing with the corporate records. The attendance of any shareholder at any shareholders' meeting shall constitute a waiver of: (a) any objection to lack of notice or defective notice of the meeting, unless the shareholder at the beginning of the meeting objects to holding the meeting or transacting business at the meeting; and (b) any
objection to consideration of a particular matter at the meeting that is not within the purpose or purposes described in the meeting notice, unless the shareholder objects to considering the matter when it is presented.
Section 2.6. QUORUM OF SHAREHOLDERS. Unless the Restated Articles of Incorporation or the Act provide otherwise, a majority of the outstanding shares entitled to vote on a particular matter at a meeting shall constitute a quorum for purposes of action on that matter at the meeting. A share may be represented at a meeting by the record holder thereof in person or by proxy. Once a share is represented for any purpose at a meeting, it is deemed present for quorum purposes for the remainder of the meeting and for any adjournment of that meeting unless a new record date is or must be set for that adjourned meeting. Whether or not a quorum is present, the meeting may be adjourned by a majority vote of the shareholders present or represented. At any adjourned meeting where a quorum is present, any business may be transacted that could have been transacted at the meeting originally called.
Section 2.7. RECORD DATE FOR DETERMINATION OF SHAREHOLDERS. The Board of Directors shall establish a record date for determining shareholders entitled to notice of a shareholders' meeting, to vote or to take any other action, which date shall not be more than 70 days before the meeting or action requiring a determination of shareholders. A determination of shareholders is effective for any adjournment of the meeting, unless a new record date is or must be set.
Section 2.8. SHAREHOLDERS' LIST FOR MEETING. The officer or agent in charge of the stock transfer books for shares of the Company shall prepare an alphabetical list of the names of all shareholders who are entitled to notice of a shareholders' meeting. The list shall be arranged by voting group, and within each voting group by class or series of shares, and show the address of and number of shares held by each shareholder. The list shall be made available for inspection by any shareholder, at least 10 days before the meeting for which the list was prepared and continuing through the meeting, at the Company's principal office or at a place identified in the meeting notice in the city where the meeting will be held. The Company also shall make the list available at the shareholders' meeting, and any shareholder is entitled to inspect the list at any time during the meeting or any adjournment.
Section 2.9. TRANSACTION OF BUSINESS AT SHAREHOLDERS' MEETINGS.
2.9.1 TRANSACTION OF BUSINESS AT ANNUAL MEETING. Business transacted at an annual meeting of shareholders may include all such business as may properly come before the meeting. Nominations of persons for election to the Board of Directors and the proposal of business to be considered by the shareholders may be made at an annual meeting of shareholders: (a) pursuant to the Company's notice of meeting; (b) by or at the direction of the Board of Directors; or (c) by any shareholder who was a shareholder of record at the time of giving of notice of the meeting, who is entitled to vote at the meeting and who complies with the notice procedures set forth in this Section 2.9.1.
For nominations or other business to be properly brought before an annual meeting by a shareholder, the shareholder must have given timely notice thereof in writing to the Secretary of the Company and such other business must otherwise be a proper matter for shareholder action. To be timely, a shareholder's notice shall be delivered to the Secretary at the principal executive offices of the Company not earlier than the close of business on the 90th day nor later than the close of business on the 60th day prior to the first anniversary of the preceding year's annual meeting; provided, however, that in the event that the date of the annual meeting is more than 30 days before or more than 60 days after such anniversary date, notice by the shareholder to be timely must be so delivered not earlier than the close of business on the 90th day prior to such annual meeting and not later than the close of business on the later of the 60th day prior to such annual meeting or the 10th day following the day on which public announcement of the date of such meeting is first made by the Company. In no event shall the public announcement of an adjournment of an annual meeting commence a new time period for the giving of a shareholder's notice as described above. Such shareholder's notice shall set forth: (a) as to each person whom the shareholder proposes to nominate for election or reelection as a director all information relating to such person that is required to
be disclosed in solicitations of proxies for election of directors in an election contest, or is otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (the "Exchange Act") and Rule 14a-11 thereunder (including such person's written consent to being named in the proxy statement as a nominee and to serving as a director if elected); (b) as to any other business that the shareholder proposes to bring before the meeting, a brief description of the business desired to be brought before the meeting, the reasons for conducting such business at the meeting and any material interest in such business of such shareholder and the beneficial owner, if any, on whose behalf the proposal is made; and (c) as to the shareholder giving the notice and the beneficial owner, if any, on whose behalf the nomination or proposal is made (i) the name and address of such shareholder, as they appear on the Company's books, and of such beneficial owner and (ii) the class and number of shares of the Company which are owned beneficially and of record by such shareholder and such beneficial owner.
2.9.2 TRANSACTION OF BUSINESS AT SPECIAL MEETING. Business transacted at a special meeting of the shareholders shall be limited to the purposes set forth in the notice of the special meeting. Nominations of persons for election to the Board of Directors may be made at a special meeting of shareholders at which directors are to be elected pursuant to the Company's notice of meeting: (a) by or at the direction of the Board of Directors; or (b) provided that the Board of Directors has determined that directors shall be elected at such meeting, by any shareholder of the Company who is a shareholder of record at the time of giving of notice of the meeting, who is entitled to vote at the meeting and who complies with the notice procedures set forth in this Section 2.9.2.
In the event the Company calls a special meeting of shareholders for the purpose of electing one or more directors to the Board of Directors, any such shareholder may nominate a person or persons, as the case may be, for election to such position or positions as specified in the Company's notice of meeting, if the shareholder's notice required by this Section 2.9.2 shall be delivered to the Secretary at the principal executive offices of the Company not earlier than the close of business on the 90th day prior to such special meeting and not later than the close of business on the later of the 60th day prior to such special meeting or the 10th day following the day on which public announcement is first made of the date of the special meeting and of the nominees proposed by the Board of Directors to be elected at such meeting. In no event shall the public announcement of an adjournment of a special meeting commence a new time period for the giving of a shareholder's notice as described above. Such shareholder's notice shall set forth: (a) as to each person whom the shareholder proposes to nominate for election or reelection as a director all information relating to such person that is required to be disclosed in solicitations of proxies for election of directors in an election contest, or is otherwise required, in each case pursuant to Regulation 14A under the Exchange Act and Rule 14a-11 thereunder (including such person's written consent to being named in the proxy statement as a nominee and to serving as a director if elected); and (b) as to the shareholder giving the notice and the beneficial owner, if any, on whose behalf the nomination or proposal is made, (i) the name and address of such shareholder, as they appear on the Company's books, and of such beneficial owner and (ii) the class and number of shares of the Company which are owned beneficially and of record by such shareholder and such beneficial owner.
2.9.3 GENERAL. Only such persons who are nominated in accordance with the procedures set forth in this Section 2.9 shall be eligible to serve as directors and only such business shall be conducted at a meeting of shareholders as shall have been brought before the meeting in accordance with the procedures set forth in this Section 2.9. The chairman of the meeting shall have the power and duty to determine whether a nomination or any business proposed to be brought before the meeting was made or proposed, as the case may be, in accordance with the procedures set forth in this Section 2.9 and, if any proposed nomination or business is not in compliance with this Section 2.9, to declare that such defective proposal or nomination shall be disregarded, unless otherwise provided by any applicable law.
For purposes of this Section 2.9, "public announcement" shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press or comparable national news service or in a
document publicly filed by the Company with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act.
Notwithstanding the foregoing provisions of this Section 2.9, a shareholder
shall also comply with all applicable requirements of the Exchange Act and the
rules and regulations thereunder with respect to the matters set forth in this
Section 2.9. Nothing in this Section 2.9 shall be deemed to affect any rights
of: (a) the shareholders to request inclusion of proposals in the Company's
proxy statement pursuant to Rule 14a-8 under the Exchange Act; or (b) the
holders of any series of Preferred Stock to elect directors under specified
circumstances.
Section 2.10. ACTION BY WRITTEN CONSENT. Any action required or permitted by the Act to be taken at an annual or special meeting of shareholders may be taken without a meeting, without prior notice, and without a vote, if consents in writing, setting forth the action so taken, are signed by the holders of all of the outstanding shares of stock entitled to vote on the matter.
Section 2.11. PRESIDING OFFICER. The Chairman of the Board shall act as chairman of all meetings of the shareholders. In the absence of the Chairman of the Board, the President, or in his or her absence, any Vice President designated by the Board of Directors shall act as the chairman of the meeting.
Section 2.12. PROCEDURE. At each meeting of shareholders, the chairman of
the meeting shall fix and announce the date and time of the opening and the
closing of the polls for each matter upon which the shareholders will vote at
the meeting and shall determine the order of business and all other matters of
procedure. Except to the extent inconsistent with any such rules and regulations
as adopted by the Board of Directors, the chairman of the meeting may establish
rules, which need not be in writing, to maintain order and safety and for the
conduct of the meeting. Without limiting the foregoing, the chairman of the
meeting may: (a) determine and declare to the meeting that any business is not
properly before the meeting and therefore shall not be considered; (b) restrict
attendance at any time to bona fide shareholders of record and their proxies and
other persons in attendance at the invitation of the chairman of the meeting;
(c) restrict dissemination of solicitation materials and use of audio or visual
recording devices at the meeting; (d) adjourn the meeting without a vote of the
shareholders, whether or not there is a quorum present; and (e) make rules
governing speeches and debate, including time limits and access to microphones.
The chairman of the meeting acts in his or her absolute discretion and his or her rulings are not subject to appeal.
ARTICLE III
BOARD OF DIRECTORS
Section 3.1. AUTHORITY. The Board of Directors shall have the ultimate authority over the conduct and management of the business affairs of the Company.
Section 3.2. NUMBER. The number of directors of the Company shall be not less than nine (9) nor more than 15, as determined from time to time by the vote of a majority of the Board of Directors. Unless otherwise provided by the Act, the number of directors may be increased or decreased, beyond the limits set forth above, only by an amendment to these Bylaws. To the extent permitted by the Act, any newly created or eliminated directorships resulting from such increase or decrease shall be apportioned by the Board of Directors among the then existing classes of directors so as to maintain such classes as nearly equal in number as possible. No change in the number of directors shall shorten the term of any director then in office.
Section 3.3. TERM. Each director shall hold office from the date of his or her election and qualification until his or her successor shall have been duly elected and qualified or until his or her earlier removal, resignation, death or incapacity.
Section 3.4. ELIGIBILITY FOR ELECTIONS. No person who will be 70 years of age or more on or before an annual meeting shall be nominated to the Board of Directors, and any directors who reach the age of 70 shall be automatically retired from the Board of Directors.
Section 3.5. REGULAR MEETINGS OF THE BOARD. Regular meetings of the Board of Directors may be held at times and places agreed on by a majority of the directors at any meeting of the Board of Directors, and such regular meetings may be held at such times and places without any further notice of the date, time, place or purposes of such regular meetings.
Section 3.6. SPECIAL MEETINGS OF THE BOARD. Special meetings of the Board of Directors may be called: (a) by, or at the request of, the Chairman of the Board; or (b) by the Secretary of the Company at the written request of a majority of the directors then in office. Special meetings of the Board of Directors may be called on not less than 12 hours notice to each director, given orally or in writing, either personally, by telephone (including by message or by recording device), by facsimile transmission, by telegram or by telex, or on not less than three (3) calendar days' notice to each director given by mail. Notice of the special meeting of the Board of Directors shall specify the date, time and place of the meeting. Actions taken at any such meeting shall not be invalidated because of lack of notice if notice is waived as provided in Section 3.7.
Section 3.7. WAIVER OF NOTICE. A director may waive any required notice before or after the date and time stated in the notice by written waiver signed by the director entitled to the notice and filed with the minutes or corporate records. In addition, a director's attendance at or participation in a meeting waives any required notice to the director of the meeting unless the director at the beginning of the meeting, or promptly upon the director's arrival, objects to holding the meeting or transacting business at the meeting and does not thereafter vote for or assent to action taken at the meeting.
Section 3.8. PARTICIPATION BY TELECOMMUNICATION. Any director may participate in any meeting of the Board of Directors through the use of any means of communication by which all directors participating in the meeting may simultaneously hear each other during the meeting. A director participating in a meeting by this means shall be deemed to be present in person at the meeting.
Section 3.9. QUORUM OF DIRECTORS. A majority of the directors in office immediately before the meeting begins shall constitute a quorum for the transaction of business at any meeting of the Board of Directors.
Section 3.10. ACTION. If a quorum is present when the vote is taken, the Board of Directors shall take actions pursuant to resolutions adopted by the affirmative vote of: (a) a majority of the directors present at the meeting of the Board of Directors; or (b) such greater number of the directors as may be required by the Restated Articles of Incorporation, these Bylaws or the Act.
Section 3.11. ACTION BY UNANIMOUS WRITTEN CONSENT. Any action required or permitted to be taken at a Board of Directors' meeting may be taken without a meeting if the action is taken by all members of the Board of Directors. The action shall be evidenced by one (1) or more written consents describing the action taken, signed by each director, and included in the minutes or filed with the corporate records reflecting the action taken.
Section 3.12. SELECTION OF OFFICERS. The Board of Directors shall select a Chairman of the Board of Directors, a President, a Vice President, a Secretary and a Treasurer and such additional Vice Presidents, Assistant Secretaries, Assistant Treasurers and other officers and agents as the Board of Directors from time to time may deem advisable.
Section 3.13. POWERS AND DUTIES OF OFFICERS AND AGENTS. The powers and duties of the officers and agents shall be determined by the Board of Directors and these Bylaws.
Section 3.14. DELEGATION OF POWERS. For any reason deemed sufficient by the Board of Directors, whether occasioned by absence or otherwise, the Board may delegate all or any of the powers and duties of
any officer to any other officer or director, but no officer or director shall execute, verify or acknowledge any instrument in more than one capacity unless specifically authorized by the Board of Directors.
Section 3.15. APPOINTMENT OF EXECUTIVE COMMITTEE. At the same meeting at which the Board of Directors selects the Chairman of the Board, the Board of Directors shall appoint an Executive Committee consisting of two (2) or more members, who shall serve at the pleasure of the Board of Directors. Such appointments shall be made by a majority of all the directors in office when the action is taken. Unless otherwise provided by the Act or further limited by a resolution of the Board of Directors, the Executive Committee may exercise all of the powers of the Board of Directors.
Section 3.16. POWER TO APPOINT ADDITIONAL COMMITTEES OF THE BOARD. The Board of Directors shall have the power to designate, by resolution, one (1) or more additional committees and appoint members of the Board of Directors to serve on them. To the extent provided in such resolution, such committees may manage the business and affairs of the Company, unless otherwise provided by the Act. Each committee shall have two (2) or more members, who shall serve at the pleasure of the Board of Directors. A majority of the members of any committee of the Board of Directors will constitute a quorum for any committee action.
Section 3.17. COMPENSATION. The Board of Directors may, by resolution, authorize the payment to directors of compensation for the performance of their duties. No such payment shall preclude any director from serving the Company in any other capacity and receiving compensation therefor. The Board of Directors may also, by resolution, authorize the reimbursement of expenses incurred by directors in the performance of their duties.
Section 3.18. CONFLICTING INTEREST TRANSACTION. Any conflicting interest transaction shall be governed by Sections 30-1-860 through 30-1-863 of the Act.
ARTICLE IV
OFFICERS
Section 4.1. GENERAL. The officers of the Company shall consist of a Chairman of the Board, a President, a Vice President, a Secretary, a Treasurer and such additional Vice Presidents, Assistant Secretaries, Assistant Treasurers and other officers and agents as the Board of Directors from time to time may deem advisable. Each such officer shall hold office for a term of one year or until his or her successor shall have been duly elected and qualified or until his or her earlier resignation, retirement, removal from office, incapacity or death. The Board of Directors may remove any officer or agent at any time, with or without cause, unless otherwise provided by the Act or the Restated Articles of Incorporation. One person may hold two or more offices, except the offices of President and Secretary.
Section 4.2. CHAIRMAN OF THE BOARD. The Chairman of the Board shall be selected by and from the members of the Board of Directors. He or she shall conduct all meetings of the Board of Directors and shall perform all duties incident thereto.
Section 4.3. PRESIDENT. The President shall have general and active management of the business of the Company and shall see that all orders and resolutions of the Board of Directors are carried into effect. The President shall have the general powers and duties of supervision and management usually vested in the office of president of a corporation.
Section 4.4. VICE PRESIDENTS. Each Vice President shall serve under the direction of the President and shall perform such other duties as the Board of Directors shall from time to time direct.
Section 4.5. SECRETARY. The Secretary of the Company shall serve under the direction of the President and shall perform such other duties as the Board of Directors shall from time to time direct, unless otherwise provided by these Bylaws or determined by the Board of Directors. The Secretary shall be responsible for preparing minutes of the directors' and shareholders' meetings and for authenticating
records of the Company. The Secretary shall safely keep in his or her custody the seal of the Company and shall have authority to affix the same to all instruments where its use is required. The Secretary shall give all notices required by the Act, these Bylaws or any resolution of the Board of Directors.
Section 4.6. TREASURER. The Treasurer shall serve under the direction of the President and shall perform such other duties as the Board of Directors shall from time to time direct. The Treasurer shall have custody of all corporate funds and securities and shall keep in books belonging to the Company full and accurate accounts of all receipts and disbursements. The Treasurer shall deposit all monies, securities and other valuable effects in the name of the Company in such depositories as may be designated for that purpose by the Board of Directors and shall disburse the funds of the Company as may be ordered by the Board of Directors. The Treasurer shall upon request report to the Board of Directors on the financial condition of the Company.
Section 4.7. ASSISTANT SECRETARY AND ASSISTANT TREASURER. The Assistant Secretary, in the absence or disability of the Secretary, shall perform the duties and exercise the powers of the Secretary. The Assistant Treasurer, in the absence or disability of the Treasurer, shall perform the duties and exercise the powers of the Treasurer.
ARTICLE V
STOCK AND TRANSFERS
Section 5.1. CERTIFICATES FOR SHARES. Subject to the provisions of Section 5.2, every shareholder shall be entitled to a certificate of the shares to which the shareholder has subscribed, and each certificate shall be signed, either manually or by facsimile, by any two (2) of the following: the Chairman of the Board, the President, the Treasurer and the Secretary. Such certificate may bear the seal of the Company or a facsimile thereof. Each certificate shall state the name of the Company, the number and class of shares and the designation of the series, if any, that the certificate represents. In case any officer, transfer agent or registrar who has signed, or whose facsimile signature has been placed upon, a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Company with the same effect as if such person or entity were such officer, transfer agent or registrar at the date of issue.
Section 5.2 SHARES WITHOUT CERTIFICATES. The Company shall have the power to authorize the issue of some or all of the shares of any or all of its classes or series without certificates. The authorization shall not affect shares already represented by certificates until they are surrendered to the Company. Within a reasonable time after the issue or transfer of shares without certificates, the Company shall send the shareholder a written statement of the information required on certificates by the Act.
Section 5.3 TRANSFERABLE ONLY ON BOOKS OF THE COMPANY. Shares of the capital stock of the Company shall be transferred on the books of the Company only by the holder of the shares in person or by an attorney lawfully appointed in writing and upon surrender of the certificates, if any, for the shares. A record shall be made of every such transfer and issue. Whenever any transfer is made for collateral security and not absolutely, the fact shall be so expressed in the entry of such transfer.
Section 5.4 STOCK LEDGER. The Company shall maintain a stock ledger that contains the name and address of each shareholder and the number of shares of each class of the capital stock that the shareholder holds. The stock ledger may be in written form or in any other form that can be converted within a reasonable time into written form for visual inspection.
Section 5.5 REGISTERED SHAREHOLDERS. The Company shall have the right to treat the registered holder of any share of its capital stock as the absolute owner of such share and shall not be bound to recognize any equitable or other claim to or interest in such share on the part of any other person, whether or not the Company shall have express or other notice thereof, unless otherwise required by any applicable law.
ARTICLE VI
INDEMNIFICATION
Section 6.1. DEFINED TERMS. Capitalized terms used in this Article VI that are defined in Section 30-1-850 of the Act shall have the meaning given to such terms under Section 30-1-850 of the Act.
Section 6.2. INSURANCE. The Company shall have the power to purchase and maintain insurance, in such amounts as the Board of Directors may deem appropriate, on behalf of any person who is a Director, Officer, employee or agent against Liability and Expenses in connection with any Proceeding, to the extent permitted under any applicable law.
Section 6.3. AGREEMENTS. The Company may enter into an indemnification agreement with any Director, Officer, employee or agent, to the extent permitted under any applicable law.
Section 6.4. AMENDMENTS. Any amendment or repeal of this Article VI shall not be retroactive in effect.
Section 6.5. SEVERABILITY. In case any provision in this Article VI shall be determined at any time to be unenforceable in any respect, the other provisions shall not in any way be affected or impaired thereby, and the affected provision shall be given the fullest possible enforcement in the circumstances.
ARTICLE VII
AMENDMENT OF BYLAWS
Section 7.1. AMENDMENT BY THE BOARD OF DIRECTORS. These Bylaws may be amended, altered, changed, added to, repealed or substituted by the affirmative vote of a majority of the Board of Directors, unless the Restated Articles of Incorporation, these Bylaws or the Act provide otherwise.
Section 7.2. AMENDMENT BY THE SHAREHOLDERS. Subject to the provisions of
Section 7.3, these Bylaws may be amended, altered, changed, added to, repealed
or substituted by the affirmative vote of a majority of all shares entitled to
vote thereon, if notice of the proposed amendment, alteration, change, addition,
repeal or substitution is contained in the notice of the meeting.
Section 7.3. AMENDMENT OF CERTAIN PROVISIONS. Notwithstanding any other
provision of these Bylaws, (i) any amendment, alteration, change, addition,
repeal or substitution of this Section 7.3, Section 2.9 or Article III of these
Bylaws by the shareholders shall require the affirmative vote of two-thirds of
all shares entitled to vote thereon; and (ii) no change of the date for the
annual meeting of the shareholders shall be made by the shareholders within the
30-day period preceding the date designated for the annual meeting pursuant to
Section 2.l, unless consented to in writing, as provided in Section 2.10, or
approved at any meeting of the shareholders by a majority of all shares entitled
to vote thereon.
EXHIBIT D
PART 13 "DISSENTERS' RIGHTS" OF THE
IDAHO BUSINESS CORPORATION ACT
30-1-1301 DEFINITIONS.--IN THIS PART:
(1) "Corporation" means the issuer of the shares held by a dissenter before the corporate action, or the surviving or acquiring corporation by merger or share exchange of that issuer.
(2) "Dissenter" means a shareholder who is entitled to dissent from corporate action under section 30-1-1302, Idaho Code, and who exercises that right when and in the manner required by sections 30-1-1320 through 30-1-1328, Idaho Code.
(3) "Fair value," with respect to a dissenter's shares, means the value of the shares immediately before the effectuation of the corporate action to which the dissenter objects, excluding any appreciation or depreciation in anticipation of the corporate action unless exclusion would be inequitable.
(4) "Interest" means interest from the effective date of the corporate action until the date of payment, at the average rate currently paid by the corporation on its principal bank loans or, if none, at a rate that is fair and equitable under all the circumstances.
(5) "Record shareholder" means the person in whose name shares are registered in the records of the corporation or the beneficial owner of shares to the extent of the rights granted by a nominee certificate on file with a corporation.
(6) "Beneficial shareholder" means the person who is a beneficial owner of shares held in a voting trust or by a nominee as the record shareholder.
(7) "Shareholder" means the record shareholder or the beneficial shareholder.
30-1-1302 RIGHT TO DISSENT.--(1)
A shareholder is entitled to dissent from, and obtain payment of the fair value of his shares in the event of, any of the following corporate actions:
(a) Consummation of a plan of merger to which the corporation is a party:
(i) If shareholder approval is required for the merger by section 30-1-1103, Idaho Code, or the articles of incorporation and the shareholder is entitled to vote on the merger; or
(ii) If the corporation is a subsidiary that is merged with its parent under section 30-1-1104, Idaho Code;
(b) Consummation of a plan of share exchange to which the corporation is a party as the corporation whose shares will be acquired, if the shareholder is entitled to vote on the plan;
(c) Consummation of a sale or exchange of all, or substantially all, of the
property of the corporation other than in the usual and regular course of
business, if the shareholder is entitled to vote on the sale or exchange,
including a sale in dissolution, but not including a sale pursuant to court
order or a sale for cash pursuant to a plan by which all or substantially all of
the net proceeds of the sale will be distributed to the shareholders within one
(1) year after the date of sale;
(d) An amendment of the articles of incorporation that materially and adversely affects rights in respect of a dissenter's shares because it:
(i) Alters or abolishes a preferential right of the shares;
(ii) Creates, alters or abolishes a right in respect of redemption, including a provision respecting a sinking fund for the redemption or repurchase, of the shares;
(iii) Alters or abolishes a preemptive right of the holder of the shares to acquire shares or other securities;
(iv) Excludes or limits the right of the shares to vote on any matter, or to cumulate votes, other than a limitation by dilution through issuance of shares or other securities with similar voting rights; or
(v) Reduces the number of shares owned by the shareholder to a fraction of a share if the fractional share so created is to be acquired for cash under section 30-1-604, Idaho Code; or
(e) Any corporate action taken pursuant to a shareholder vote to the extent the articles of incorporation, bylaws, or a resolution of the board of directors provides that voting or nonvoting shareholders are entitled to dissent and obtain payment for their shares.
(2) A shareholder entitled to dissent and obtain payment for his shares under this part may not challenge the corporate action creating his entitlement unless the action is unlawful or fraudulent with respect to the shareholder or the corporation.
(3) This section does not apply to the holders of shares of any class or series if the shares of the class or series are redeemable securities issued by a registered investment company as defined pursuant to the investment company act of 1940 (15 U.S.C. 80a-15 U.S.C. 80a-64).
(4) Unless the articles of incorporation of the corporation provide otherwise, this section does not apply to the holders of shares of a class or series if the shares of the class or series were registered on a national securities exchange, were listed on the national market systems of the national association of securities dealers automated quotation system or were held of record by at least two thousand (2,000) shareholders on the date fixed to determine the shareholders entitled to vote on the proposed corporate action.
30-1-1303 DISSENT BY NOMINEES AND BENEFICIAL OWNERS.--
(1) A record shareholder may assert dissenters' rights as to fewer than all the shares registered in his name only if he dissents with respect to all shares beneficially owned by any one (1) person and notifies the corporation in writing of the name and address of each person on whose behalf he asserts dissenters' rights. The rights of a partial dissenter under this subsection are determined as if the shares as to which he dissents and his other shares were registered in the names of different shareholders.
(2) A beneficial shareholder may assert dissenters' rights as to shares held on his behalf only if:
(a) He submits to the corporation the record shareholder's written consent to the dissent not later than the time the beneficial shareholder asserts dissenters' rights; and
(b) He does so with respect to all shares of which he is the beneficial shareholder or over which he has power to direct the vote.
30-1-1304-30-1-1319 [RESERVED.]
30-1-1320 NOTICE OF DISSENTERS' RIGHTS.--
(1) If proposed corporate action creating dissenters' rights under section 30-1-1302, Idaho Code, is submitted to a vote at a shareholders' meeting, the meeting notice must state that shareholders are or may be entitled to assert dissenters' rights under this part and be accompanied by a copy of this part.
(2) If corporate action creating dissenters' rights under section 30-1-1302, Idaho Code, is taken without a vote of shareholders, the corporation shall notify in writing all shareholders entitled to assert
dissenters' rights that the action was taken and send them the dissenters' notice described in section 30-1-1322, Idaho Code.
30-1-1321 NOTICE OF INTENT TO DEMAND PAYMENT.--
(1) If proposed corporate action creating dissenters' rights under section 30-1-1302, Idaho Code, is submitted to a vote at a shareholders' meeting, a shareholder who wishes to assert dissenters' rights:
(a) Must deliver to the corporation before the vote is taken written notice of his intent to demand payment for his shares if the proposed action is effectuated; and
(b) Must not vote his shares in favor of the proposed action.
(2) A shareholder who does not satisfy the requirements of subsection (1) of this section is not entitled to payment for his shares under this part.
30-1-1322 DISSENTERS' NOTICE.--
(1) If proposed corporate action creating dissenters' rights under section 30-1-1302, Idaho Code, is authorized at a shareholders' meeting, the corporation shall deliver a written dissenters' notice to all shareholders who satisfied the requirements of section 30-1-1321, Idaho Code.
(2) The dissenters' notice must be sent no later than ten (10) days after the corporate action was taken, and must:
(a) State where the payment demand must be sent and where and when certificates for certificated shares must be deposited;
(b) Inform holders of uncertificated shares to what extent transfer of the shares will be restricted after the payment demand is received;
(c) Supply a form for demanding payment that includes the date of the first announcement to news media or to shareholders of the terms of the proposed corporate action and requires that the person asserting dissenters' rights certify whether or not he acquired beneficial ownership of the shares before that date;
(d) Set a date by which the corporation must receive the payment demand, which date may not be fewer than thirty (30) nor more than sixty (60) days after the date the notice in subsection (1) of this section is delivered; and
(e) Be accompanied by a copy of this part.
30-1-1323 DUTY TO DEMAND PAYMENT.--
(1) A shareholder sent a dissenters' notice described in section 30-1-1322, Idaho Code, must demand payment, certify whether he acquired beneficial ownership of the shares before the date required to be set forth in the dissenters' notice pursuant to section 30-1-1322(2)(c), Idaho Code, and, with respect to any certificated shares, deposit his certificates in accordance with the terms of the notice.
(2) The shareholder who demands payment and, with respect to any certificated shares, deposits his share certificates under subsection (1) of this section retains all other rights of a shareholder until these rights are cancelled or modified by the taking of the proposed corporate action.
(3) A shareholder who does not demand payment or deposit his share certificates where required, each by the date set in the dissenters' notice, is not entitled to payment for his shares under this part.
30-1-1324 SHARE RESTRICTIONS.--
(1) The corporation may restrict the transfer of uncertificated shares from the date the demand for their payment is received until the proposed corporate action is taken or the restrictions released under section 30-1-1326, Idaho Code.
(2) The person for whom dissenters' rights are asserted as to uncertificated shares retains all other rights of a shareholder until these rights are cancelled or modified by the taking of the proposed corporate action.
30-1-1325 PAYMENT.--
(1) Except as provided in section 30-1-1327, Idaho Code, as soon as the proposed corporate action is taken, or upon receipt of a payment demand, the corporation shall pay each dissenter who complied with section 30-1-1323, Idaho Code, the amount the corporation estimates to be the fair value of his shares, plus accrued interest.
(2) The payment must be accompanied by:
(a) The corporation's balance sheet as of the end of a fiscal year ending not more than sixteen (16) months before the date of payment, an income statement for that year, a statement of changes in shareholders' equity for that year, and the latest available interim financial statements, if any;
(b) A statement of the corporation's estimate of the fair value of the shares;
(c) An explanation of how the interest was calculated;
(d) A statement of the dissenter's right to demand payment under section 30-1-1328, Idaho Code; and
(e) A copy of this part.
30-1-1326 FAILURE TO TAKE ACTION.--
(1) If the corporation does not take the proposed action within sixty (60) days after the date set for demanding payment and depositing share certificates, the corporation shall return the deposited certificates and release the transfer restrictions imposed on uncertificated shares.
(2) If after returning deposited certificates and releasing transfer restrictions, the corporation takes the proposed action, it must send a new dissenters' notice under section 30-1-1322, Idaho Code, and repeat the payment demand procedure.
30-1-1327 AFTER-ACQUIRED SHARES.--
(1) A corporation may elect to withhold payment required by section 30-1-1325, Idaho Code, from a dissenter unless he was the beneficial owner of the shares before the date set forth in the dissenters' notice as the date of the first announcement to news media or to shareholders of the terms of the proposed corporate action.
(2) To the extent the corporation elects to withhold payment under subsection (1) of this section, after taking the proposed corporate action, it shall estimate the fair value of the shares, plus accrued interest, and shall pay this amount to each dissenter who agrees to accept it in full satisfaction of his demand. The corporation shall send with its offer a statement of its estimate of the fair value of the shares, an explanation of how the interest was calculated, and a statement of the dissenter's right to demand payment under section 30-1-1328, Idaho Code.
30-1-1328 PROCEDURE IF SHAREHOLDER DISSATISFIED WITH PAYMENT OR OFFER.--
(1) A dissenter may notify the corporation in writing of his own estimate of the fair value of his shares and amount of interest due, and demand payment of his estimate, less any payment under section 30-1-1325, Idaho Code, or reject the corporation's offer under section 30-1-1327, Idaho Code, and demand payment of the fair value of his shares and interest due, if:
(a) The dissenter believes that the amount paid under section 30-1-1325, Idaho Code, or offered under section 30-1-1327, Idaho Code, is less than the fair value of his shares or that the interest due is incorrectly calculated;
(b) The corporation fails to make payment under section 30-1-1325, Idaho Code, within sixty (60) days after the date set for demanding payment; or
(c) The corporation, having failed to take the proposed action, does not return the deposited certificates or release the transfer restrictions imposed on uncertificated shares within sixty (60) days after the date set for demanding payment.
(2) A dissenter waives his right to demand payment under this section unless he notifies the corporation of his demand in writing under subsection (1) of this section within thirty (30) days after the corporation made or offered payment for his shares.
30-1-1329 [RESERVED.]
30-1-1330 COURT ACTION TO DETERMINE SHARE VALUE.--
(1) If a demand for payment under section 30-1-1328, Idaho Code, remains unsettled, the corporation shall commence a proceeding within sixty (60) days after receiving the payment demand and petition the court to determine the fair value of the shares and accrued interest. If the corporation does not commence the proceeding within the sixty-day period, it shall pay each dissenter whose demand remains unsettled the amount demanded.
(2) The corporation shall commence the proceeding in the Idaho district court of the county where a corporation's principal office or, if none in this state, its registered office is located. If the corporation is a foreign corporation without a registered office in this state, it shall commence the proceeding in the county in this state where the registered office of the domestic corporation merged with or whose shares were acquired by the foreign corporation was located.
(3) The corporation shall make all dissenters, whether or not residents of this state, whose demands remain unsettled parties to the proceeding, as in an action against their shares, and all parties must be served with a copy of the petition. Nonresidents may be served by registered or certified mail or by publication as provided by law.
(4) The jurisdiction of the court in which the proceeding is commenced under subsection (2) of this section is plenary and exclusive. The court may appoint one (1) or more persons as appraisers to receive evidence and recommend decision on the question of fair value. The appraisers have the powers described in the order appointing them, or in any amendment to it. The dissenters are entitled to the same discovery rights as parties in other civil proceedings.
(5) Each dissenter made a party to the proceeding is entitled to judgment:
(a) For the amount, if any, by which the court finds the fair value of his shares, plus interest, exceeds the amount paid by the corporation; or
(b) For the fair value, plus accrued interest, of his after-acquired shares for which the corporation elected to withhold payment under section 30-1-1327, Idaho Code.
30-1-1331 COURT COSTS AND COUNSEL FEES.--
(1) The court in an appraisal proceeding commenced under section 30-1-1330, Idaho Code, shall determine all costs of the proceeding, including the reasonable compensation and expenses of appraisers appointed by the court. The court shall assess the costs against the corporation, except that the court may assess costs against all or some of the dissenters, in amounts the court finds equitable, to the extent the court finds the dissenters acted arbitrarily, vexatiously, or not in good faith in demanding payment under section 30-1-1328, Idaho Code.
(2) The court may also assess the fees and expenses of counsel and experts for the respective parties, in amounts the court finds equitable:
(a) Against the corporation and in favor of any or all dissenters if the court finds the corporation did not substantially comply with the requirements of sections 30-1-1320 through 30-1-1328, Idaho Code; or
(b) Against either the corporation or a dissenter, in favor of any other party, if the court finds that the party against whom the fees and expenses are assessed acted arbitrarily, vexatiously, or not in good faith with respect to the rights provided by this part.
(3) If the court finds that the services of counsel for any dissenter were of substantial benefit to other dissenters similarly situated, and that the fees for those services should not be assessed against the corporation, the court may award to these counsel reasonable fees to be paid out of the amounts awarded to dissenters who were benefited.
PART II--INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Sections 30-1-850 ET SEQ. of the Idaho Business Corporation Act (the "Act") provide for indemnification of the Registrant's directors, officers, employees and agents in a variety of circumstances.
Article VIII of the Registrant's Restated Articles of Incorporation provides that the Registrant shall indemnify its directors and officers against liability and expenses and shall advance expenses to its directors and officers in connection with any proceeding to the fullest extent permitted by the Act as now in effect or as it may be amended or substituted from time to time. Article VI of the Amended Bylaws of the Registrant provides that the Registrant shall have the power to purchase insurance on behalf of any director, officer, employee or agent against liability and expenses in connection with any proceeding, to the extent permitted under applicable law. Article VI further provides that the Registrant may enter into indemnification agreements with any director, officer, employee or agent to the extent permitted under any applicable law.
Upon effectiveness of the Exchange, the Registrant expects to have in effect liability insurance protecting its directors and officers against liability by reason of their being or having been directors or officers. In addition, the Registrant intends to enter into indemnification agreements with its directors and officers to provide for indemnification to the maximum extent permitted by law.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULE.
(a) The following exhibits are filed herewith:
2 Agreement and Plan of Exchange, dated as of February 2, 1998 (Exhibit A to the
Proxy Statement and Prospectus).
3(a) Restated Articles of Incorporation of IDACORP, Inc. (Exhibit B to the Proxy
Statement and Prospectus).
3(b) Bylaws of Idaho Power Holding Company (IDACORP, Inc.)
3(c) Amended Bylaws of IDACORP, Inc. (Exhibit C to the Proxy Statement and
Prospectus).
3(d) Restated Articles of Incorporation of Idaho Power Company, as filed with the
Secretary of State of Idaho on June 30, 1989.
3(e) Statement of Resolution Establishing Terms of Flexible Auction Series A, Serial
Preferred Stock, Without Par Value (cumulative stated value of $100,000 per
share), of Idaho Power Company, as filed with the Secretary of State of Idaho
on November 5, 1991.
3(f) Statement of Resolution Establishing Terms of 7.07% Serial Preferred Stock,
Without Par Value (cumulative stated value of $100 per share) of Idaho Power
Company, as filed with the Secretary of State of Idaho on June 30, 1993.
3(g) Waiver resolution to Restated Articles of Incorporation of Idaho Power Company
adopted by shareholders on May 1, 1991.
3(h) By-laws of Idaho Power Company, as amended on June 30, 1989.
5(a) Opinion of Robert W. Stahman, Esq.
5(b) and 8 Opinion of LeBoeuf, Lamb, Greene & MacRae, L.L.P.
23(a) Consent of Robert W. Stahman, Esq. (included as part of Exhibit 5(a)).
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II-1
23(b) Consent of LeBoeuf, Lamb, Greene & MacRae, L.L.P. (included as part of Exhibit
5(b) and 8).
23(c) Consent of Deloitte & Touche LLP.
24 Power of Attorney (included on page II-3).
99 Form of Proxy.
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(b) The financial statement schedule is incorporated by reference from Idaho Power Company's Annual Report on Form 10-K for the year ended December 31, 1997.
ITEM 22. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) That, for purposes of determining any liability under the Securities Act, each filing of the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in the Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial BONA FIDE offering thereof.
(2) That prior to any public reoffering of the securities registered hereunder through use of a prospectus which is a part of this Registration Statement, by any person or party who is deemed to be an underwriter within the meaning of Rule 145(c), such reoffering prospectus will contain the information called for by the applicable registration form with respect to reofferings by persons who may be deemed underwriters, in addition to the information called for by the other Items of the applicable form.
(3) That every prospectus (i) that is filed pursuant to paragraph (2) immediately preceding, or (ii) that purports to meet the requirements of section 10(a)(3) of the Securities Act and is used in connection with an offering of securities subject to Rule 415, will be filed as part of an amendment to the Registration Statement and will not be used until such amendment is effective, and that, for purposes of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial BONA FIDE offering thereof.
(4) To respond to requests for information that is incorporated by reference into the prospectus pursuant to Items 4, 10(b), 11 or 13 of this Form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the Registration Statement through the date of responding to the request.
(5) To supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the Registration Statement when it became effective.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the provisions referred to in Item 20 above, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
II-2
POWER OF ATTORNEY
Each person whose signature appears below hereby authorizes any agent for service named in this registration statement to execute in the name of each such person, and to file with the Commission, any and all amendments, including post-effective amendments, to the registration statement, and appoints any such agent for service as attorney-in-fact to sign in his behalf individually and in each capacity stated below and file any such amendments to the registration statement and the issuer hereby confers like authority to sign and file in its behalf.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Boise, and State of Idaho, on the 13th day of March, 1998.
IDACORP, INC.
By /s/ JOSEPH W. MARSHALL
-------------------------------------
Joseph W. Marshall
CHAIRMAN OF THE BOARD
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Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed below by the following persons in the capacities and on the dates indicated.
SIGNATURE TITLE DATE
------------------------------ --------------------------- -------------------
/s/ JOSEPH W. MARSHALL Chairman of the Board March 13, 1998
------------------------------ (Principal Executive
(Joseph W. Marshall) Officer)
/s/ JAN B. PACKWOOD President and Director March 13, 1998
------------------------------
(Jan B. Packwood)
Vice President and March 13, 1998
/s/ J. LAMONT KEEN Treasurer (Principal
------------------------------ Financial and Accounting
(J. LaMont Keen) Officer)
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EXHIBIT INDEX
EXHIBIT PAGE
NUMBER NUMBER
------------- -------------
2 Agreement and Plan of Exchange, dated as of February 2, 1998 (Exhibit A to the Proxy
Statement and Prospectus).
3(a) Restated Articles of Incorporation of IDACORP, Inc. (Exhibit B to the Proxy Statement and
Prospectus).
3(b) Bylaws of Idaho Power Holding Company (IDACORP, Inc.).
3(c) Amended Bylaws of IDACORP, Inc. (Exhibit C to the Proxy Statement and Prospectus).
3(d) Restated Articles of Incorporation of Idaho Power Company, as filed with the Secretary of
State of Idaho on June 30, 1989.
3(e) Statement of Resolution Establishing Terms of Flexible Auction Series A, Serial Preferred
Stock, Without Par Value (cumulative stated value of $100,000 per share), of Idaho
Power Company, as filed with the Secretary of State of Idaho on November 5, 1991.
3(f) Statement of Resolution Establishing Terms of 7.07% Serial Preferred Stock, Without Par
Value (cumulative stated value of $100 per share) of Idaho Power Company, as filed with
the Secretary of State of Idaho on June 30, 1993.
3(g) Waiver resolution to Restated Articles of Incorporation of Idaho Power Company adopted by
shareholders on May 1, 1991.
3(h) By-laws of Idaho Power Company, as amended on June 30, 1989.
5(a) Opinion of Robert W. Stahman, Esq.
5(b) and 8 Opinion of LeBoeuf, Lamb, Greene & MacRae, L.L.P.
23(a) Consent of Robert W. Stahman, Esq. (included as part of Exhibit 5(a)).
23(b) Consent of LeBoeuf, Lamb, Greene & MacRae, L.L.P. (included as part of Exhibit 5(b) and
8).
23(c) Consent of Deloitte & Touche LLP.
24 Power of Attorney (included on page II-3).
99 Form of Proxy.
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Exhibit 3(b)
Bylaws
of
Idaho Power Holding Company
Boise, Idaho
February 2, 1998
Article I
OFFICE
Section 1.1 PRINCIPAL OFFICE. The Company shall maintain its principal office in Boise, Idaho.
Section 1.2 REGISTERED OFFICE. The Company shall maintain a registered office in the State of Idaho, as required by the Idaho Business Corporation Act (the "Act").
Article II
SHAREHOLDERS
Section 2.1 ANNUAL MEETING OF SHAREHOLDERS. An annual meeting of the shareholders shall be held on the first Wednesday of May or such other time as may be designated by the Board of Directors.
Section 2.2 SPECIAL MEETINGS. A special meeting of the shareholders may be called at any time by the President, a majority of the Board of Directors or the Chairman of the Board. A special meeting of the shareholders also may be called by the holders of not less than twenty percent (20%) of all the shares entitled to vote on any issue proposed to be considered at the proposed special meeting if such holders sign, date and deliver to the Secretary of the Company one (1) or more written demands for the meeting describing the purpose or purposes for which it is to be held. Upon receipt of one (1) or more written demands for such proposed special meeting by the holders of not less than twenty percent (20%) of all the shares entitled to vote on any issue proposed to be considered at the proposed special meeting, the Secretary of the Company shall be responsible for determining whether such demand or demands conform to the requirements of the Act, the Articles of Incorporation and these Bylaws. After making an affirmative determination, the Secretary shall prepare, sign and deliver the notices required for such meeting. The shareholders' demand may suggest a time and place for the meeting but the Board of Directors shall, by resolution, determine the time and place of any such meeting.
Section 2.3 PLACE OF MEETINGS. All meetings of the shareholders shall be held at the Company's principal office or at such other place as shall be designated in the notice of such meetings.
Section 2.4 NOTICE OF SHAREHOLDERS' MEETING. Written notice of the time and place of a meeting of the shareholders shall be mailed to each shareholder entitled to receive notice under the Act: (a) not less than 10 days nor more than 60 days prior to the date of an annual or special meeting of the shareholders; or (b) if applicable, within 30 days after the date on which a shareholder demand satisfying the requirements of Section 2.2 is delivered to the Secretary of the Company. Every notice of an annual or special meeting of shareholders shall be deemed duly served when the
notice is deposited in the United States mail or with a private overnight courier service, with postage prepaid and addressed to the shareholder at the shareholder's address as it appears on the Company's records or if a shareholder shall have filed with the Secretary of the Company a written request that the notice be sent to some other address, then to such other address. If an annual or special shareholders' meeting is adjourned to a different date, time or place, notice need not be given of the new date, time or place if such new date, time or place is announced at the meeting before adjournment. In any event, if a new record date for the adjourned meeting is or must be determined, notice of the adjourned meeting shall be given to persons who are shareholders as of the new record date.
Section 2.5 WAIVER OF NOTICE. Any shareholder may waive any required notice of the time, place, and purpose of any meeting of the shareholders by telegram, telecopy, confirmed facsimile, or other writing, either before or after such meeting has been held. Such waiver must be signed by the shareholder entitled to the notice and be delivered to the Company for inclusion in the minutes or filing with the corporate records. The attendance of any shareholder at any shareholders' meeting shall constitute a waiver of: (a) any objection to lack of notice or defective notice of the meeting, unless the shareholder at the beginning of the meeting objects to holding the meeting or transacting business at the meeting; and (b) any objection to consideration of a particular matter at the meeting that is not within the purpose or purposes described in the meeting notice, unless the shareholder objects to considering the matter when it is presented.
Section 2.6 QUORUM OF SHAREHOLDERS. Unless the Articles of Incorporation or the Act provide otherwise, a majority of the outstanding shares entitled to vote on a particular matter at a meeting shall constitute a quorum for purposes of action on that matter at the meeting. A share may be represented at a meeting by the record holder thereof in person or by proxy. Once a share is represented for any purpose at a meeting, it is deemed present for quorum purposes for the remainder of the meeting and for any adjournment of that meeting unless a new record date is or must be set for that adjourned meeting. Whether or not a quorum is present, the meeting may be adjourned by a majority vote of the shareholders present or represented. At any adjourned meeting where a quorum is present, any business may be transacted that could have been transacted at the meeting originally called.
Section 2.7 RECORD DATE FOR DETERMINATION OF SHAREHOLDERS. The Board of Directors shall establish a record date for determining shareholders entitled to notice of a shareholders' meeting, to vote or to take any other action, which date shall not be more than 70 days before the meeting or action requiring a determination of shareholders. A determination of shareholders is effective for any adjournment of the meeting, unless a new record date is or must be set.
Section 2.8 SHAREHOLDERS' LIST FOR MEETING. The officer or agent in charge of the stock transfer books for shares of the Company shall prepare an alphabetical list of the names of all shareholders who are entitled to notice of a shareholders' meeting. The list shall be arranged by voting group, and within each voting group by class or series of shares, and show the address of and number of shares held by each shareholder. The list shall be made available for inspection by any
shareholder, at least 10 days before the meeting for which the list was prepared and continuing through the meeting, at the Company's principal office or at a place identified in the meeting notice in the city where the meeting will be held. The Company also shall make the list available at the shareholders' meeting, and any shareholder is entitled to inspect the list at any time during the meeting or any adjournment.
Section 2.9 TRANSACTION OF BUSINESS AT SHAREHOLDERS' MEETINGS.
2.9.1 TRANSACTION OF BUSINESS AT ANNUAL MEETING. Business transacted at an annual meeting of shareholders may include all such business as may properly come before the meeting. Nominations of persons for election to the Board of Directors and the proposal of business to be considered by the shareholders may be made at an annual meeting of shareholders: (a) pursuant to the Company's notice of meeting; (b) by or at the direction of the Board of Directors; or (c) by any shareholder who was a shareholder of record at the time of giving of notice of the meeting, who is entitled to vote at the meeting and who complies with the notice procedures set forth in this Section 2.9.1.
For nominations or other business to be properly brought before an annual meeting by a shareholder, the shareholder must have given timely notice thereof in writing to the Secretary of the Company and such other business must otherwise be a proper matter for shareholder action. To be timely, a shareholder's notice shall be delivered to the Secretary at the principal executive offices of the Company not earlier than the close of business on the 90th day nor later than the close of business on the 60th day prior to the first anniversary of the preceding year's annual meeting; provided, however, that in the event that the date of the annual meeting is more than 30 days before or more than 60 days after such anniversary date, notice by the shareholder to be timely must be so delivered not earlier than the close of business on the 90th day prior to such annual meeting and not later than the close of business on the later of the 60th day prior to such annual meeting or the 10th day following the day on which public announcement of the date of such meeting is first made by the Company. In no event shall the public announcement of an adjournment of an annual meeting commence a new time period for the giving of a shareholder's notice as described above. Such shareholder's notice shall set forth: (a) as to each person whom the shareholder proposes to nominate for election or reelection as a director all information relating to such person that is required to be disclosed in solicitations of proxies for election of directors in an election contest, or is otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (the "Exchange Act") and Rule 14a-11 thereunder (including such person's written consent to being named in the proxy statement as a nominee and to serving as a director if elected); (b) as to any other business that the shareholder proposes to bring before the meeting, a brief description of the business desired to be brought before the meeting, the reasons for conducting such business at the meeting and any material interest in such business of such shareholder and the beneficial owner, if any, on whose behalf the proposal is made; and (c) as to the shareholder giving the notice and the beneficial owner, if any, on whose behalf the nomination or proposal is made (i) the name and address of such shareholder, as they appear on the Company's books, and of such beneficial
owner and (ii) the class and number of shares of the Company which are owned beneficially and of record by such shareholder and such beneficial owner.
2.9.2 TRANSACTION OF BUSINESS AT SPECIAL MEETING. Business transacted at a special meeting of the shareholders shall be limited to the purposes set forth in the notice of the special meeting. Nominations of persons for election to the Board of Directors may be made at a special meeting of shareholders at which directors are to be elected pursuant to the Company's notice of meeting: (a) by or at the direction of the Board of Directors; or (b) provided that the Board of Directors has determined that directors shall be elected at such meeting, by any shareholder of the Company who is a shareholder of record at the time of giving of notice of the meeting, who is entitled to vote at the meeting and who complies with the notice procedures set forth in this Section 2.9.2.
In the event the Company calls a special meeting of shareholders for the purpose of electing one or more directors to the Board of Directors, any such shareholder may nominate a person or persons, as the case may be, for election to such position or positions as specified in the Company's notice of meeting, if the shareholder's notice required by this Section 2.9.2 shall be delivered to the Secretary at the principal executive offices of the Company not earlier than the close of business on the 90th day prior to such special meeting and not later than the close of business on the later of the 60th day prior to such special meeting or the 10th day following the day on which public announcement is first made of the date of the special meeting and of the nominees proposed by the Board of Directors to be elected at such meeting. In no event shall the public announcement of an adjournment of a special meeting commence a new time period for the giving of a shareholder's notice as described above. Such shareholder's notice shall set forth: (a) as to each person whom the shareholder proposes to nominate for election or reelection as a director all information relating to such person that is required to be disclosed in solicitations of proxies for election of directors in an election contest, or is otherwise required, in each case pursuant to Regulation 14A under the Exchange Act and Rule 14a-11 thereunder (including such person's written consent to being named in the proxy statement as a nominee and to serving as a director if elected); and (b) as to the shareholder giving the notice and the beneficial owner, if any, on whose behalf the nomination or proposal is made, (i) the name and address of such shareholder, as they appear on the Company's books, and of such beneficial owner and (ii) the class and number of shares of the Company which are owned beneficially and of record by such shareholder and such beneficial owner.
2.9.3 GENERAL. Only such persons who are nominated in accordance with the procedures set forth in this Section 2.9 shall be eligible to serve as directors and only such business shall be conducted at a meeting of shareholders as shall have been brought before the meeting in accordance with the procedures set forth in this Section 2.9. The chairman of the meeting shall have the power and duty to determine whether a nomination or any business proposed to be brought before the meeting was made or proposed, as the case may be, in accordance with the procedures set forth in this Section 2.9 and, if any proposed nomination or business is not in compliance with this Section 2.9, to declare that such defective proposal or nomination shall be disregarded, unless otherwise provided by any applicable law.
For purposes of this Section 2.9, "public announcement" shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press or comparable national news service or in a document publicly filed by the Company with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act.
Notwithstanding the foregoing provisions of this Section 2.9, a
shareholder shall also comply with all applicable requirements of the Exchange
Act and the rules and regulations thereunder with respect to the matters set
forth in this Section 2.9. Nothing in this Section 2.9 shall be deemed to
affect any rights of: (a) the shareholders to request inclusion of proposals in
the Company's proxy statement pursuant to Rule 14a-8 under the Exchange Act; or
(b) the holders of any series of Preferred Stock to elect directors under
specified circumstances.
Section 2.10 ACTION BY WRITTEN CONSENT. Any action required or permitted by the Act to be taken at an annual or special meeting of shareholders may be taken without a meeting, without prior notice, and without a vote, if consents in writing, setting forth the action so taken, are signed by the holders of all of the outstanding shares of stock entitled to vote on the matter.
Section 2.11 PRESIDING OFFICER. The Chairman of the Board shall act as chairman of all meetings of the shareholders. In the absence of the Chairman of the Board, the President, or in his or her absence, any Vice President designated by the Board of Directors shall act as the chairman of the meeting.
Section 2.12 PROCEDURE. At each meeting of shareholders, the chairman of the meeting shall fix and announce the date and time of the opening and the closing of the polls for each matter upon which the shareholders will vote at the meeting and shall determine the order of business and all other matters of procedure. Except to the extent inconsistent with any such rules and regulations as adopted by the Board of Directors, the chairman of the meeting may establish rules, which need not be in writing, to maintain order and safety and for the conduct of the meeting. Without limiting the foregoing, the chairman of the meeting may: (a) determine and declare to the meeting that any business is not properly before the meeting and therefore shall not be considered; (b) restrict attendance at any time to bona fide shareholders of record and their proxies and other persons in attendance at the invitation of the chairman of the meeting; (c) restrict dissemination of solicitation materials and use of audio or visual recording devices at the meeting; (d) adjourn the meeting without a vote of the shareholders, whether or not there is a quorum present; and (e) make rules governing speeches and debate, including time limits and access to microphones.
The chairman of the meeting acts in his or her absolute discretion and his or her rulings are not subject to appeal.
Article III
BOARD OF DIRECTORS
Section 3.1 AUTHORITY. The Board of Directors shall have the ultimate authority over the conduct and management of the business affairs of the Company.
Section 3.2 NUMBER. The number of directors of the Company shall be not less than two (2) nor more than four (4) as determined from time to time by the vote of a majority of the Board of Directors. Unless otherwise provided by the Act, the number of directors may be increased or decreased, beyond the limits set forth above, only by an amendment to these Bylaws. No change in the number of directors shall shorten the term of any director then in office.
Section 3.3 TERM. Each director shall hold office from the date of his or her election and qualification until his or her successor shall have been duly elected and qualified or until his or her earlier removal, resignation, death or incapacity.
Section 3.4 ELIGIBILITY FOR ELECTIONS. No person who will be 70 years of age or more on or before an annual meeting shall be nominated to the Board of Directors, and any directors who reach the age of 70 shall be automatically retired from the Board of Directors.
Section 3.5 REGULAR MEETINGS OF THE BOARD. Regular meetings of the Board of Directors may be held at times and places agreed on by a majority of the directors at any meeting of the Board of Directors, and such regular meetings may be held at such times and places without any further notice of the date, time, place or purposes of such regular meetings.
Section 3.6 SPECIAL MEETINGS OF THE BOARD. Special meetings of the Board of Directors may be called: (a) by, or at the request of, the Chairman of the Board; or (b) by the Secretary of the Company at the written request of a majority of the directors then in office. Special meetings of the Board of Directors may be called on not less than 12 hours notice to each director, given orally or in writing, either personally, by telephone (including by message or by recording device), by facsimile transmission, by telegram or by telex, or on not less than three (3) calendar days' notice to each director given by mail. Notice of the special meeting of the Board of Directors shall specify the date, time and place of the meeting. Actions taken at any such meeting shall not be invalidated because of lack of notice if notice is waived as provided in Section 3.7.
Section 3.7 WAIVER OF NOTICE. A director may waive any required notice before or after the date and time stated in the notice by written waiver signed by the director entitled to the notice and filed with the minutes or corporate records. In addition, a director's attendance at or participation in a meeting waives any required notice to the director of the meeting unless the director at the beginning of the meeting, or promptly upon the director's arrival, objects to holding the meeting or transacting business at the meeting and does not thereafter vote for or assent to action taken at the meeting.
Section 3.8 PARTICIPATION BY TELECOMMUNICATION. Any director may participate in any meeting of the Board of Directors through the use of any means of communication by which all directors participating in the meeting may simultaneously hear each other during the meeting. A director participating in a meeting by this means shall be deemed to be present in person at the meeting.
Section 3.9 QUORUM OF DIRECTORS. A majority of the directors in office immediately before the meeting begins shall constitute a quorum for the transaction of business at any meeting of the Board of Directors.
Section 3.10 ACTION. If a quorum is present when the vote is taken, the Board of Directors shall take actions pursuant to resolutions adopted by the affirmative vote of: (a) a majority of the directors present at the meeting of the Board of Directors; or (b) such greater number of the directors as may be required by the Articles of Incorporation, these Bylaws or the Act.
Section 3.11 ACTION BY UNANIMOUS WRITTEN CONSENT. Any action required or permitted to be taken at a Board of Directors' meeting may be taken without a meeting if the action is taken by all members of the Board of Directors. The action shall be evidenced by one (1) or more written consents describing the action taken, signed by each director, and included in the minutes or filed with the corporate records reflecting the action taken.
Section 3.12 SELECTION OF OFFICERS. The Board of Directors shall select a Chairman of the Board of Directors, a President, a Vice President, a Secretary and a Treasurer and such additional Vice Presidents, Assistant Secretaries, Assistant Treasurers and other officers and agents as the Board of Directors from time to time may deem advisable.
Section 3.13 POWERS AND DUTIES OF OFFICERS AND AGENTS. The powers and duties of the officers and agents shall be determined by the Board of Directors and these Bylaws.
Section 3.14 DELEGATION OF POWERS. For any reason deemed sufficient by the Board of Directors, whether occasioned by absence or otherwise, the Board may delegate all or any of the powers and duties of any officer to any other officer or director, but no officer or director shall execute, verify or acknowledge any instrument in more than one capacity unless specifically authorized by the Board of Directors.
Section 3.15 APPOINTMENT OF EXECUTIVE COMMITTEE. At the same meeting at which the Board of Directors selects the Chairman of the Board, the Board of Directors shall appoint an Executive Committee consisting of two (2) or more members, who shall serve at the pleasure of the Board of Directors. Such appointments shall be made by a majority of all the directors in office when the action is taken. Unless otherwise provided by the Act or further limited by a resolution of the Board of Directors, the Executive Committee may exercise all of the powers of the Board of Directors.
Section 3.16 POWER TO APPOINT ADDITIONAL COMMITTEES OF THE BOARD. The Board of Directors shall have the power to designate, by resolution, one (1) or more additional committees and appoint members of the Board of Directors to serve on them. To the extent provided in such resolution, such committees may manage the business and affairs of the Company, unless otherwise provided by the Act. Each committee shall have two (2) or more members, who shall serve at the pleasure of the Board of Directors. A majority of the members of any committee of the Board of Directors will constitute a quorum for any committee action.
Section 3.17 COMPENSATION. The Board of Directors may, by resolution, authorize the payment to directors of compensation for the performance of their duties. No such payment shall preclude any director from serving the Company in any other capacity and receiving compensation therefor. The Board of Directors may also, by resolution, authorize the reimbursement of expenses incurred by directors in the performance of their duties.
Section 3.18 CONFLICTING INTEREST TRANSACTION. Any conflicting interest transaction shall be governed by Sections 30-1-860 through 30-1-863 of the Act.
Article IV
OFFICERS
Section 4.1 GENERAL. The officers of the Company shall consist of a Chairman of the Board, a President, a Vice President, a Secretary, a Treasurer and such additional Vice Presidents, Assistant Secretaries, Assistant Treasurers and other officers and agents as the Board of Directors from time to time may deem advisable. Each such officer shall hold office for a term of one year or until his or her successor shall have been duly elected and qualified or until his or her earlier resignation, retirement, removal from office, incapacity or death. The Board of Directors may remove any officer or agent at any time, with or without cause, unless otherwise provided by the Act or the Articles of Incorporation. One person may hold two or more offices, except the offices of President and Secretary.
Section 4.2 CHAIRMAN OF THE BOARD. The Chairman of the Board shall be selected by and from the members of the Board of Directors. He or she shall conduct all meetings of the Board of Directors and shall perform all duties incident thereto.
Section 4.3 PRESIDENT. The President shall have general and active management of the business of the Company and shall see that all orders and resolutions of the Board of Directors are carried into effect. The President shall have the general powers and duties of supervision and management usually vested in the office of president of a corporation.
Section 4.4 VICE PRESIDENTS. Each Vice President shall serve under the direction of the President and shall perform such other duties as the Board of Directors shall from time to time direct.
Section 4.5 SECRETARY. The Secretary of the Company shall serve under the direction of the President and shall perform such other duties as the Board of Directors shall from time to time direct, unless otherwise provided by these Bylaws or determined by the Board of Directors. The Secretary shall be responsible for preparing minutes of the directors' and shareholders' meetings and for authenticating records of the Company. The Secretary shall safely keep in his or her custody the seal of the Company and shall have authority to affix the same to all instruments where its use is required. The Secretary shall give all notices required by the Act, these Bylaws or any resolution of the Board of Directors.
Section 4.6 TREASURER. The Treasurer shall serve under the direction of the President and shall perform such other duties as the Board of Directors shall from time to time direct. The Treasurer shall have custody of all corporate funds and securities and shall keep in books belonging to the Company full and accurate accounts of all receipts and disbursements. The Treasurer shall deposit all monies, securities and other valuable effects in the name of the Company in such depositories as may be designated for that purpose by the Board of Directors and shall disburse the funds of the Company as may be ordered by the Board of Directors. The Treasurer shall upon request report to the Board of Directors on the financial condition of the Company.
Section 4.7 ASSISTANT SECRETARY AND ASSISTANT TREASURER. The Assistant Secretary, in the absence or disability of the Secretary, shall perform the duties and exercise the powers of the Secretary. The Assistant Treasurer, in the absence or disability of the Treasurer, shall perform the duties and exercise the powers of the Treasurer.
Article V
STOCK AND TRANSFERS
Section 5.1 CERTIFICATES FOR SHARES. Subject to the provisions of
Section 5.2, every shareholder shall be entitled to a certificate of the shares
to which the shareholder has subscribed, and each certificate shall be signed,
either manually or by facsimile, by any two (2) of the following: the Chairman
of the Board, the President, the Treasurer and the Secretary. Such certificate
may bear the seal of the Company or a facsimile thereof. Each certificate shall
state the name of the Company, the number and class of shares and the
designation of the series, if any, that the certificate represents. In case any
officer, transfer agent or registrar who has signed, or whose facsimile
signature has been placed upon, a certificate shall have ceased to be such
officer, transfer agent or registrar before such certificate is issued, it may
be issued by the Company with the same effect as if such person or entity were
such officer, transfer agent or registrar at the date of issue.
Section 5.2 SHARES WITHOUT CERTIFICATES. The Company shall have the power to authorize the issue of some or all of the shares of any or all of its classes or series without certificates. The authorization shall not affect shares already represented by certificates until they are surrendered to the Company. Within a reasonable time after the issue or transfer of shares without certificates, the Company shall send the shareholder a written statement of the information required on certificates by the Act.
Section 5.3 TRANSFERABLE ONLY ON BOOKS OF THE COMPANY. Shares of the capital stock of the Company shall be transferred on the books of the Company only by the holder of the shares in person or by an attorney lawfully appointed in writing and upon surrender of the certificates, if any, for the shares. A record shall be made of every such transfer and issue. Whenever any transfer is made for collateral security and not absolutely, the fact shall be so expressed in the entry of such transfer.
Section 5.4 STOCK LEDGER. The Company shall maintain a stock ledger that contains the name and address of each shareholder and the number of shares of each class of the capital stock that the shareholder holds. The stock ledger may be in written form or in any other form that can be converted within a reasonable time into written form for visual inspection.
Section 5.5 REGISTERED SHAREHOLDERS. The Company shall have the right to treat the registered holder of any share of its capital stock as the absolute owner of such share and shall not be bound to recognize any equitable or other claim to or interest in such share on the part of any other person, whether or not the Company shall have express or other notice thereof, unless otherwise required by any applicable law.
Article VI
INDEMNIFICATION
Section 6.1 DEFINED TERMS. Capitalized terms used in this Article VI that are defined in Section 30-1-850 of the Act shall have the meaning given to such terms under Section 30-1-850 of the Act.
Section 6.2 INSURANCE. The Company shall have the power to purchase and maintain insurance, in such amounts as the Board of Directors may deem appropriate, on behalf of any person who is a Director, Officer, employee or agent against Liability and Expenses in connection with any Proceeding, to the extent permitted under any applicable law.
Section 6.3 AGREEMENTS. The Company may enter into an indemnification agreement with any Director, Officer, employee or agent, to the extent permitted under any applicable law.
Section 6.4 AMENDMENTS. Any amendment or repeal of this Article VI shall not be retroactive in effect.
Section 6.5 SEVERABILITY. In case any provision in this Article VI shall be determined at any time to be unenforceable in any respect, the other provisions shall not in any way be affected or impaired thereby, and the affected provision shall be given the fullest possible enforcement in the circumstances.
Article VII
AMENDMENT OF BYLAWS
Section 7.1 AMENDMENT BY THE BOARD OF DIRECTORS. These Bylaws may be amended, altered, changed, added to, repealed or substituted by the affirmative vote of a majority of the Board of Directors, unless the Articles of Incorporation, these Bylaws or the Act provide otherwise.
Section 7.2 AMENDMENT BY THE SHAREHOLDERS. Subject to the provisions of Section 7.3, these Bylaws may be amended, altered, changed, added to, repealed or substituted by the affirmative vote of a majority of all shares entitled to vote thereon, if notice of the proposed amendment, alteration, change, addition, repeal or substitution is contained in the notice of the meeting.
Section 7.3 AMENDMENT OF CERTAIN PROVISIONS. Notwithstanding any other provision of these Bylaws, (i) any amendment, alteration, change, addition, repeal or substitution of this Section 7.3, Section 2.9 or Article III of these Bylaws by the shareholders shall require the affirmative vote of two- thirds of all shares entitled to vote thereon; and (ii) no change of the date for the annual meeting of the shareholders shall be made by the shareholders within the 30-day period preceding the date designated for the annual meeting pursuant to Section 2.l, unless consented to in writing, as provided in Section 2.10, or approved at any meeting of the shareholders by a majority of all shares entitled to vote thereon.
Exhibit 3(d)
RESTATED
ARTICLES OF INCORPORATION
OF
IDAHO POWER COMPANY
ARTICLE 1. NAME. The name of the Corporation is Idaho Power Company and its duration shall be perpetual.
ARTICLE 2. PURPOSES. The purposes of the Corporation are to:
1. buy, sell, lease and use machinery, generators, motors, lamps, apparatus, devices, supplies and articles of every kind pertaining to or in any wise connected with the production, use, distribution, regulation, control or application of electricity or electrical apparatus for light, heat, power, telegraph, telephone, railway, manufacturing and any and all other purposes; to construct, acquire, purchase, use, sell or lease any works, construction or plants or parts thereof connected with or involving the production, use, distribution, regulation, control or application of electricity or electrical apparatus for any of such purposes; to buy, acquire, lease, use, produce, furnish and supply electricity or any other power or force, in any form and for any purpose whatsoever;
2. acquire, build, construct, own, lease and operate railway properties of all kinds and descriptions (including parks, places of amusement and other usual or useful adjuncts to said railway property and business) and with any kind of motive power, and to sell and lease the same;
3. manufacture, purchase, sell and distribute, for light, heat and power and all other purposes, natural and artificial gas, and to acquire, construct, purchase, own, maintain, operate, sell and lease all necessary and convenient works, conduits, plants, apparatus and connections for holding, receiving, purifying, manufacturing, selling, utilizing and distributing natural or artificial gas; to manufacture and sell or otherwise dispose of chemicals or other products derived wholly or in part from gas or gas works;
4. manufacture, purchase, sell and distribute steam and hot water for heating and other purposes, and to acquire, construct, purchase, own, maintain, operate, sell and lease all necessary and convenient works, plants, apparatus and connections for manufacturing, selling and distributing steam and hot water;
5. construct and acquire by purchase, lease or otherwise, reservoirs, dams, canals, ditches, flumes, pipe lines and such other works, plants, equipments, appliances and appurtenances as may be necessary, useful or appropriate for impounding, storing, conveying, distributing and utilizing water for power, irrigation, fire, sanitary, domestic, manufacturing
and other uses, and to use, apply, sell and otherwise dispose of water for such uses; to construct and to acquire by purchase, lease or otherwise, and to operate hydraulic and other works, transmission plants, transmission lines, transforming and distributing stations and distributing circuits and any and all rights of way connected therewith or useful therefor; to transform the power generated by hydraulic or other plants into electrical or other energy, and transmit, use or otherwise dispose of the said electrical or other energy for any and all purposes; to acquire any and all rights or other property necessary or useful in connection with acquiring, owning and operating any or all of said plants; and
6. acquire, buy, operate, lease and sell ice and refrigerating plants; and to acquire, lease, hold, use and otherwise avail of such real and personal estate, property, rights, privileges, grants, consents and franchises, including inventions, patents, processes, stocks, bonds and other evidences of indebtedness of persons, firms or corporations, and franchises or special grants or privileges from cities, towns or other municipalities, as the company shall deem requisite or advantageous in pursuance of any of its corporate purposes above stated; and to mortgage, pledge, sell, convey or otherwise dispose of any or all of the foregoing; and to undertake, contract for or carry on any business or operation deemed by the Company incidental to, or in aid of, or advantageous in pursuance of, any of its corporate purposes.
Nothing herein shall be deemed to limit or exclude any power, right or privilege given to the Corporation by law, and it is not intended that the Corporation shall exercise in any state any powers not permitted to it under the law of such state.
ARTICLE 3. LOCATION AND REGISTERED AGENT. The address of the registered office of this Corporation is PO Box 70, 1220 West Idaho Street, Boise, Idaho 83707, and the name of the registered agent at this address is Robert W. Stahman. The incorporator of this Corporation is Robert W. Stahman, whose address is PO Box 70, 1220 West Idaho Street, Boise, Idaho 83707.
ARTICLE 4. DIRECTORS. (a) The number of directors constituting the Board of Directors of the Corporation shall be fixed from time to time exclusively by the Board of Directors pursuant to a resolution adopted by affirmative vote of two- thirds of the Continuing Directors (as defined in Article 8 of the Restated Articles of Incorporation), but the number of directors shall be no less than 9 and no greater than 15. The number of directors may be increased or decreased, beyond the limits set forth above, only by an amendment to the Restated Articles of Incorporation of the Corporation pursuant to Article 10 of the Restated Articles of Incorporation of the Corporation.
The Board of Directors shall be divided into three classes as nearly equal in number as may be. The initial term of office
of each director in the first class shall expire at the annual meeting of shareholders in 1990; the initial term of office of each director in the second class shall expire at the annual meeting of shareholders in 1991; and the initial term of office of each director in the third class shall expire at the annual meeting of shareholders in 1992. At each annual election commencing at the annual meeting of shareholders in 1990, the successors to the class of directors whose term expires at that time shall be elected to hold office for a term of three years to succeed those whose term expires, so that the term of one class of directors shall expire each year. Each director shall hold office for the term for which he is elected or appointed and until his successor shall be elected and qualified or until his death, or until he shall resign or be removed; provided, however, that no person who will be seventy (70) years of age or more on or before the annual meeting shall be nominated to the Board of Directors, and any directors who reach the age of seventy (70) shall be automatically retired from the Board.
In the event of any increase or decrease in the authorized number of directors, (i) each director then serving as such shall nevertheless continue as a director of the class of which he is a member until the expiration of his current term, or his earlier resignation, removal from office or death, and (ii) the newly created or eliminated directorships resulting from such increase or decrease shall be apportioned by the Board of Directors among the three classes of directors so as to maintain such classes as nearly equal in number as may be.
(b) Newly created directorships resulting from any increase in the authorized number of directors of any vacancies in the Board of Directors resulting from death, resignation, retirement, disqualification, removal from office or other cause shall be filled by a two-thirds vote of the directors then in office, or a sole remaining director, although less than a quorum, and directors so chosen shall hold office for a term expiring at the annual meeting of shareholders at which the term of the class to which they have been elected expires. If one or more directors shall resign from the Board effective as of a future date, such vacancy or vacancies shall be filled pursuant to the provisions hereof, and such new directorship(s) shall become effective when such resignation or resignations shall become effective, and each director so chosen shall hold office as herein provided in the filling of other vacancies.
(c) At a special meeting of shareholders called expressly for that purpose, the entire Board of Directors or any individual directors may be removed (i) without cause, by the unanimous vote of the outstanding shares entitled to vote for directors, and (ii) for cause, by the affirmative vote of two-thirds of the outstanding shares entitled to vote for directors. Except as may otherwise be provided by law, cause for removal shall be construed to exist only if: (x) the director whose removal is proposed has been convicted, or granted immunity to testify where
another has been convicted, of a felony by a court of competent jurisdiction and
such conviction is no longer subject to appeal; (y) such director has been
grossly negligent in the performance of his duties to the Corporation; or
(z) such director has been adjudicated by a court of competent jurisdiction to
be mentally incompetent, which mental incompetency directly affects his ability
as a director of the Corporation, and such adjudication is no longer subject to
appeal.
(d) Any directors elected pursuant to special voting rights of the 4% Preferred Stock or Serial Preferred Stock, without par value, voting as a separate class, shall be excluded from, and for no purpose be counted in, the scope and operation of the foregoing provisions.
ARTICLE 5. MEETINGS OF SHAREHOLDERS. Meetings of the shareholders of the Corporation may be held within or without the State of Idaho.
ARTICLE 6. AUTHORIZED STOCK.
A. The authorized stock of the Corporation is divided into four classes which are designated (i) 4% Preferred Stock, (ii) Serial Preferred Stock, $100 par value, (iii) Serial Preferred Stock, without par value, and (iv) Common Stock. The Corporation has the authority to issue 215,000 shares of 4% Preferred Stock; 150,000 shares of Serial Preferred Stock, $100 par value; 3,000,000 shares of Serial Preferred Stock, without par value; and 50,000,000 shares of Common Stock. Each share of 4% Preferred Stock and each share of Serial Preferred Stock, $100 par value, has a par value of one hundred dollars ($100). Each share of Common Stock has a par value of two and one-half dollars ($2.50). The aggregate par value of all shares of stock having a par value which the Corporation has authority to issue is $161,500,000. The total number of shares without par value which the Corporation has authority to issue is 3,000,000.
B. No shareholder of the corporation shall have any preemptive rights.
C. The relative rights, preferences and limitations of each class are as follows:
1. 4% PREFERRED STOCK
The 4% Preferred Stock, PARI PASSU with the Serial Preferred Stock, $100 par value, and the Serial Preferred Stock, without par value, is entitled to the payment of dividends and to the distribution of assets in liquidation, and has the following relative rights and preferences:
(a) DIVIDEND. The 4% Preferred Stock is entitled in preference to the Common Stock to dividends at the rate of four per cent (4%) per annum, payable quarterly, semi-annually or
annually, as the Board of Directors may determine, and such dividends are cumulative from and after August 1, 1944, or from the date of issue if issued after August 1, 1944. The 4% Preferred Stock shall not receive any dividends from profits in excess of its stated dividend rate of four per cent (4%) per annum.
(b) REDEMPTION.
(1) The 4% Preferred Stock is subject to redemption at the option of the Corporation in whole or in part at any time at one hundred and four per cent (104%) of par plus any dividends unpaid to the date of redemption, upon the vote of not less than a majority in interest of the outstanding shares of the Common Stock at any corporate meeting or any meeting of the holders of the Common Stock called for such purpose.
(2) Notice of the intention of the Corporation to redeem the 4% Preferred Stock shall be mailed 30 days before the date of redemption to each holder of the 4% Preferred Stock of record at his last known post office address. From and after any such call for redemption of the 4% Preferred Stock and deposit by the Corporation of the moneys required for such purpose, the shares so to be redeemed shall no longer be considered as outstanding, and shall not be entitled to vote or to be included in determining the total voting power of the issued and outstanding shares of stock of the Corporation.
(c) LIQUIDATION. The 4% Preferred Stock shall have a preference over the Common Stock in any distribution of assets, other than profits, until the full par value thereof and the stated dividend rate per annum thereon from August 1, 1944, or from the date of issue thereof if issued after August 1, 1944, shall have been paid by dividends or distribution. The 4% Preferred Stock shall not receive any share in the distribution of assets in excess of said par value and the amount of such accumulated dividends.
2. SERIAL PREFERRED STOCK, $100 PAR VALUE.
(a) The Serial Preferred Stock, $100 par value, in preference to the Common Stock and PARI PASSU with the 4% Preferred Stock and the Serial Preferred Stock, without par value, is entitled to the payment of dividends and to the distribution of assets in liquidation. Shares of the Serial Preferred Stock, $100 par value, may be divided into and issued in series. Each series shall be so designated as to distinguish the shares thereof from the shares of all other series and classes. All shares of the same series shall be identical and all shares of the Serial Preferred Stock, $100 par value, shall be identical except as to the following relative rights and preferences, as to which there may be variations between different series:
(1) DIVIDENDS. The rate of dividend and whether it is to be cumulative, non-cumulative or partially-cumulative;
(2) REDEMPTION. Whether shares may be redeemed and, if so, the redemption prices and the terms and conditions of redemption;
(3) LIQUIDATION. The amount payable upon shares in the event of voluntary liquidation;
(4) SINKING FUND. Sinking fund provisions, if any, for the redemption or purchase of shares;
(5) CONVERSION. The terms and conditions, if any, on which shares may be converted into shares of any other class or into shares of any series of the same or any other class, except a class having prior or superior rights and preferences as to the payment of dividends or the distribution of assets in liquidation; and
(6) VOTING RIGHTS. The voting rights, if any.
The Board of Directors hereby is expressly vested with authority to divide any or all of the Serial Preferred Stock, $100 par value (other than the 7.68% Series, the designation and relative rights and preferences of which are set forth below), into series, to establish and designate each such series, and within the limits set forth above and in accordance with law, to fix and determine the relative rights and preferences of the shares of any series so established.
(b) The following provisions shall apply to the Serial Preferred Stock, $100 par value, of all series:
(1) DIVIDENDS. The holders of shares of the Serial Preferred Stock, $100 par value, of each series, PARI PASSU with the holders of shares of the 4% Preferred Stock and the Serial Preferred Stock, without par value, shall be entitled to receive dividends, payable when and as declared by the Board of Directors, on such dates and at such rates as shall be determined for the respective series, from the first day of the dividend period for the respective series within which such shares shall have been originally issued or from such other date as the Board of Directors may have determined for such shares, before any dividends shall be declared or paid upon or set apart for the Common Stock or any other class of stock over which the Serial Preferred Stock, $100 par value, shall have preference as to the payment of dividends. Such dividends shall be cumulative so that if, for any dividend period or periods, dividends shall not have been paid or declared and set apart for payment upon all of the then outstanding shares of Serial Preferred Stock, $100 par value, at the rates and from the dates determined for the
respective series, the deficiency shall be fully paid, or declared and set apart for payment, before any dividends shall be declared or paid upon the Common Stock or any other class of stock over which the Serial Preferred Stock, $100 par value, shall have preference as to the payment of dividends. Dividends shall be declared and set apart for payment, or paid, on the Serial Preferred Stock, $100 par value, for each dividend period during or for which dividends shall have been declared and set apart for payment, or paid, on the 4% Preferred Stock. Dividends shall not be declared and set apart for payment, or paid, on the Serial Preferred Stock, $100 par value, of any one series for any dividend period, unless dividends shall have been paid, or contemporaneously, shall have been declared and set apart for payment, or paid, upon all of the then outstanding shares of the Serial Preferred Stock, $100 par value, the Serial Preferred Stock, without par value, and the 4% Preferred Stock for all dividend periods terminating on the same or an earlier date.
(2) REDEMPTION.
(A) At the option of the its Board of Directors, the Corporation may redeem any series of the Serial Preferred Stock, $100 par value, and each such series may be redeemed, as a whole or in part, at any time (subject to such restrictions, if any, as may be set forth in the resolution of the Board of Directors establishing such series) at the redemption price specified for such series; provided, however, that not less than thirty nor more than sixty days prior to the date fixed for redemption, a notice of the time and place thereof shall be given to the holders of record of the shares of the Serial Preferred Stock, $100 par value, so to be redeemed, by mail or publication, in such manner as may be prescribed by resolution of the Board of Directors; and provided further, that, in every case of redemption of less than all of the outstanding shares of any one series of Serial Preferred Stock, $100 par value, the shares of such series to be redeemed shall be chosen by lot in such manner as may be prescribed by resolution by the Board of Directors. At any time after notice of redemption has been given, the Corporation may deposit the aggregate redemption price with some bank or trust company in The City of New York or in Boise, Idaho, named in such notice, payable on the date fixed for redemption as aforesaid and in the amounts aforesaid to the respective orders of the holders of the shares so to be redeemed, upon endorsement to the Corporation or as otherwise may be required and surrender of the certificates for such shares. Upon the deposit of such money as aforesaid, or, if no such deposit is made, upon such redemption date (unless the Corporation defaults in making payment of the redemption price as set forth in such notice), such holders shall cease to be shareholders with respect to such shares, and from and after the making of such deposit, or if no such deposit is made, after the redemption date (the Corporation not having defaulted in making payment of the redemption price as set forth in such notice), such holders shall have no interest in or claim against the Corporation with respect to such shares, but shall be entitled only to receive such moneys on the date fixed for redemption as aforesaid from such bank or trust company, or, if no such deposit is made, from the Corporation, without interest thereon, upon endorsement and surrender of the certificates as aforesaid.
(B) In case the holder of any shares of the Serial Preferred Stock, $100 par value, so redeemed shall not, within six years after such deposit, claim the amount deposited as above stated for the redemption thereof, the depositary shall upon demand pay over to the Corporation such amounts so deposited, and the depositary, thereupon, shall be relieved from all responsibility to the holder thereof. No interest on such deposit shall be payable to any such holder.
(C) Shares of the Serial Preferred Stock, $100 par value, which have been redeemed by the Corporation shall be restored to the status of authorized but unissued shares of the Serial Preferred Stock, $100 par value,
without designation or relative rights, preferences or limitations as to series.
(D) Nothing herein contained shall limit any legal right of the Corporation to purchase or otherwise acquire any of the shares of the Serial Preferred Stock, $100 par value.
(3) LIQUIDATION. Upon any dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, the holders of the then outstanding shares of the Serial Preferred Stock, $100 par value, of each series, PARI PASSU with the holders of the then outstanding shares of all other series of the Serial Preferred Stock, $100 par value, the Serial Preferred Stock, without par value, and the 4% Preferred Stock, shall be entitled to receive out of the assets of the Corporation, whether capital surplus or other, before any distribution of such assets shall be made to the holders of shares of the Common Stock or of any other class of stock as to which the Serial Preferred Stock, $100 par value, has preference as to the distribution of assets in liquidation, an amount per share (i) in the case of voluntary liquidation, as specified in the resolution of the Board of Directors fixing and determining the relative rights and preferences of the shares of such series, or (ii) in the case of involuntary liquidation, equal to the par value thereof. If the assets to be distributed in respect of the Serial Preferred Stock, $100 par value, shall not be sufficient to pay the full amounts that shall be determined to be payable on all the shares of the Serial Preferred Stock, $100 par value, upon voluntary or involuntary liquidation, such assets shall be distributed, to the extent available, as follows: first, to the payment, PRO RATA, of $100 per share on each share of the Serial Preferred Stock, $100 par value, outstanding irrespective of series; second, to the payment of the accumulated dividends on such shares, such payment to be made PRO RATA in accordance with the amount of accumulated dividends on each such share; and, third, to the payment of any amounts in excess of $100 per share plus accumulated dividends which may be payable on the shares of any series in the event of voluntary liquidation, such payment also to be made PRO RATA in accordance with the amounts, if any, so payable on each such share. After full payment to the holders of the Serial Preferred Stock, $100 par value, of such preferential amounts, the holders of the Serial Preferred Stock, $100 par value, as such, shall have no right or claim to any of the remaining assets of the Corporation. Without limiting the right of the Corporation to distribute its assets or to dissolve, liquidate or wind up in connection with any sale, merger or consolidation, the sale of all the property of the Corporation to, or the merger or consolidation of the Corporation into or with, any other corporation shall not be deemed to be a distribution of assets or a dissolution, liquidation or winding up for the purposes of this paragraph.
(c) THE 7.68% SERIES. The following provisions shall apply only to the first series of the Serial Preferred Stock, $100 par value, which is designated as the 7.68% Series and consists of 150,000 shares. The relative rights and preferences of the shares of the 7.68% Series, in those respects as to which there are variations between different series of the Serial Preferred Stock, $100 par value, are as follows:
(1) DIVIDENDS. The rate of dividends on shares of the 7.68% Series shall be 7.68% of par value per annum. Dividends shall be cumulative from September 27, 1972. The initial dividend will be payable on February 15, 1973, for the period commencing with September 27, 1972, and ending January 31, 1973. Thereafter, dividends shall be payable on the 15th day of February, May, August and November of each year or otherwise as the Board of Directors may determine.
(2) REDEMPTION. Shares of the 7.68% Series shall be redeemable at any time in whole or in part at the per share redemption prices of $102.97 plus unpaid accumulated dividends, if any, to the date of redemption.
(3) LIQUIDATION. The amounts payable upon shares of the 7.68% Series in the event of voluntary liquidation is $100 per share plus accumulated dividends, if any. In the event of any preferential payments, the 7.68% Series shall be entitled PRO RATA to such preferential payments.
(4) SINKING FUND. There is no sinking fund for the redemption or purchase of shares of the 7.68% Series.
(5) CONVERSION. Shares of the 7.68% Series are not, by their terms, convertible or exchangeable.
(6) VOTING RIGHTS. At all meetings of the shareholders, each holder of shares of the 7.68% Series shall be entitled to one vote for each share held by him.
3. SERIAL PREFERRED STOCK, WITHOUT PAR VALUE
(a) The Serial Preferred Stock, without par value, in preference to the Common Stock and PARI PASSU with the 4% Preferred Stock, and the Serial Preferred Stock, $100 par value, is entitled to the payment of dividends and to the distribution of assets in liquidation. Shares of the Serial Preferred Stock, without par value, may be divided into and issued in series. Each series shall be so designated as to distinguish the shares thereof from the shares of all other series and classes. All shares of the same series shall be identical and all shares of the Serial Preferred Stock, without par value, shall be identical except as to the following relative rights and preferences, as to which there may be variations between different series:
(1) DIVIDENDS. The rate of dividend and whether it is to be cumulative, non-cumulative or partially-cumulative;
(2) REDEMPTION. Whether shares may be redeemed and, if so, the redemption price and the terms and conditions of redemption;
(3) LIQUIDATION. The amount payable upon shares in the event of voluntary or involuntary liquidation;
(4) SINKING FUND. Sinking fund provisions, if any, for the redemption or purchase of shares;
(5) CONVERSION. The terms and conditions, if any, on which shares may be converted into shares of any other class or into shares of any series of the same or any other class, except a class having prior to superior rights and preferences as to the payment of dividends or the distribution of assets in liquidation; and
(6) VOTING RIGHTS. The voting rights, if any, in addition to those specifically set forth in subsection D.1. of this Article.
The Board of Directors hereby is expressly vested with authority to divide any or all of the Serial Preferred Stock, without par value, into series, to establish and designate each such series, and within the limits set forth above and in accordance with law, to fix and determine the relative rights and preferences of the shares of any series so established.
(b) The following provisions shall apply to the Serial Preferred Stock, without par value, of all series:
(1) DIVIDENDS. The holders of shares of the Serial Preferred Stock, without par value, of each series, PARI PASSU with the holders of shares of the 4% Preferred Stock and the Serial Preferred Stock, $100 par value, shall be entitled to receive dividends, payable when and as declared by the Board of Directors on such dates and at such rates as shall be determined for the respective series, from the first day of the dividend period for the respective series within which such shares shall have been originally issued or from such other date as the Board of Directors may have determined for such shares, before any dividends shall be declared or paid upon or set apart for the Common Stock or any other class of stock over which the Serial Preferred Stock, without par value, shall have preference as to the payment of dividends. Such dividends shall be cumulative so that if, for any dividend period or periods, dividends shall not have been paid or declared and set apart for payment upon all of the then outstanding shares of Serial Preferred Stock, without par value, at the rates and from the dates determined for the respective series, the deficiency shall be fully paid, or declared and set apart for payment, before any dividends shall be
declared or paid upon the Common Stock or any other class of stock over which the Serial Preferred Stock, without par value, shall have preference as to the payment of dividends. Dividends shall be declared and set apart for payment, or paid, on the Serial Preferred Stock, without par value, for each dividend period during or for which dividends shall have been declared and set apart for payment, or paid, on the 4% Preferred Stock. Dividends shall not be declared and set apart for payment, or paid, on the Serial Preferred Stock, without par value, of any one series for any dividend period, unless dividends shall have been paid, or contemporaneously, shall have been declared and set apart for payment, or paid, upon all of the then outstanding shares of the Serial Preferred Stock, without par value, the Serial Preferred Stock, $100 par value, and the 4% Preferred Stock for all dividend periods terminating on the same or an earlier date.
(2) REDEMPTION.
(A) At the option of its Board of Directors, the Corporation may redeem any series of the Serial Preferred Stock, without par value, and each such series may be redeemed, as a whole or in part, at any time (subject to such restrictions, if any, as may be set forth in the resolution of the Board of Directors establishing such series) at the redemption price specified for such series; provided, however, that not less than thirty nor more than sixty days prior to the date fixed for redemption, a notice of the time and place thereof shall be given to the holders of record of the shares of the Serial Preferred Stock, without par value, so to be redeemed, by mail or publication, in such manner as may be prescribed by resolution of the Board of Directors; and provided further, that, in every case of redemption of less than all of the outstanding shares of any one series of Serial Preferred Stock, without par value, the shares of such series to be redeemed shall be chosen by lot in such manner as may be prescribed by resolution of the Board of Directors. At any time after notice of redemption has been given, the Corporation may deposit the aggregate redemption price with some bank or trust company in The City of New York or in Boise, Idaho, named in such notice, payable on the date fixed for redemption as aforesaid and in the amounts aforesaid to the respective orders of the holders of the shares so to be redeemed, upon endorsement to the Corporation or as otherwise may be required and surrender of the certificates for such shares. Upon the deposit of such money as aforesaid, or, if no such deposit is made, upon such redemption date (unless the Corporation defaults in making payment of the redemption price as set forth in such notice), such holders shall cease to be shareholders with respect to such shares, and from and after the making of such deposit, or if no such deposit is made, after the redemption date (the Corporation not having defaulted in making payment of the redemption price as set forth in such notice), such holders shall have no interest in or claim against the Corporation with respect to such shares, but shall be entitled only to receive such moneys on the date fixed for redemption as aforesaid from such bank or trust company, or, if no such deposit is made, from the Corporation, without interest thereon, upon endorsement and surrender of the certificates as aforesaid.
(B) In case the holder of any shares of the Serial Preferred Stock, without par value, so redeemed shall not, within six years after such deposit, claim the amount deposited as above stated for the redemption thereof, the depositary shall upon demand pay over to the Corporation such amounts so deposited, and depositary, thereupon, shall be relieved from all responsibility to the holder thereof. No interest on such deposit shall be payable to any such holder.
(C) Shares of the Serial Preferred Stock, without par value, which have been redeemed by the Corporation shall be restored to the status of authorized but unissued shares of the Serial Preferred Stock, without par value,
without designation or relative rights, preferences or limitations as to series.
(D) Nothing herein contained shall limit any legal right of the Corporation to purchase or otherwise acquire any of the shares of the Serial Preferred Stock, without par value.
(3) LIQUIDATION. Upon any dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, the holders of the then outstanding shares of the Serial Preferred Stock, without par value, of each series, PARI PASSU with the holders of the then outstanding shares of all other series of the Serial Preferred Stock, without par value, the Serial Preferred Stock, $100 par value, and the 4% Preferred Stock, shall be entitled to receive out of the assets of the Corporation, whether capital, surplus or other, before any distribution of such assets shall be made to the holders of the shares of the Common Stock or any other class of stock, as to which the Serial Preferred Stock, without par value, has preference as to the distribution of assets in liquidation, the amount per share in the case of voluntary liquidation and the amount per share in the case of involuntary liquidation as specified in the resolution of the Board of Directors fixing and determining the relative rights and preferences of the shares of such series. If the assets to be distributed in respect of the Serial Preferred Stock, without par value, shall not be sufficient to pay the full amounts that shall be determined to be payable on all of the shares of the Serial Preferred Stock, without par value, upon voluntary or involuntary liquidation, such assets shall be distributed, to the extent available, as follows: first, to the payment, PRO RATA on each share of the Serial Preferred Stock, without par value, irrespective of series, of the amount (exclusive of accumulated dividends, if any) specified by the Board of Directors in its resolution establishing each such series as payable on each such share in the event of involuntary liquidation; second, to the payment of the accumulated dividends on each such share, such payment to be made PRO RATA in accordance with the amount of such accumulated dividends; and third, to the payment of any amounts, in excess of the amount fixed by the Board of Directors to be payable on each such share in the event of involuntary liquidation, which may be payable on the shares of any series in the event of voluntary liquidation, such payments also to be made PRO RATA in accordance with the amounts, if any, so payable on each such share. After full payment to the holders of the Serial Preferred Stock, without par value, of such preferential amounts, the holders of the Serial Preferred Stock, without par value, as such, shall have no right or claim to any of the remaining assets of the Corporation. Without limiting the right of the Corporation to distribute its assets or to dissolve, liquidate or wind up in connection with any sale, merger or consolidation, the sale of all the property of the Corporation to, or the merger or consolidation of the Corporation into or with, any other
corporation shall not be deemed to be a distribution of assets or a dissolution, liquidation or winding up for the purposes of this paragraph.
(c) THE 9.50% SERIES, SERIAL PREFERRED STOCK, WITHOUT PAR VALUE. There is hereby created the first series of the Company's Serial Preferred Stock, Without Par Value, which shall be designated as the 9.50% Series, Serial Preferred Stock, Without Par Value, which consists of 250,000 shares. The rights and preferences of the shares of said series in those respects in which the shares thereof may vary from shares of other series, shall be as follows:
(1) DIVIDENDS. The rate of dividends on shares of the 9.50% Series, Serial Preferred Stock, Without Par Value, shall be 9.50% of the amount payable per share in the event of voluntary liquidation excluding any accumulated dividends. Dividends shall be cumulative from July 8, 1976. The initial dividend will be payable on August 20, 1976, for the period commencing with July 8, 1976, and ending July 31, 1976. Thereafter, dividends shall be payable on the 20th day of November, February, May and August of each year or otherwise as the Board of Directors may determine.
(2) REDEMPTION. Shares of the 9.50% Series, Serial Preferred Stock, Without Par Value, shall be redeemable at any time in whole or in part at the per share redemption price of $104.75 through August 20, 1991, and $101.00 thereafter, plus in each case, unpaid accumulated dividends, if any, to the date of redemption.
(3) LIQUIDATION. The amount payable upon shares of the 9.50% Series, Serial Preferred Stock, Without Par Value, in the event of voluntary or involuntary liquidation is $100 per share (to be referred to as the "Stated Value") plus accumulated dividends, if any.
In the event of any preferential payments, the 9.50% Series, Serial Preferred Stock, Without Par Value, shall be entitled PRO RATA to such preferential payments.
(4) SINKING FUND. There is no sinking fund for the redemption or purchase of shares of 9.50% Series, Serial Preferred Stock, Without Par Value.
(5) CONVERSION. Shares of the 9.50% Series, Serial Preferred Stock, Without Par Value, are not, by their terms, convertible or exchangeable.
(6) VOTING RIGHTS. At all meetings of the shareholders, each holder of shares of the 9.50% Series, Serial Preferred Stock, Without Par Value, shall be entitled to one vote for each share held by the shareholder.
4. COMMON STOCK
Each share of Common Stock is equal to every other share of Common Stock in every respect. Subject to the rights of the holders of the 4% Preferred Stock, the Serial Preferred Stock, $100 par value, the Serial Preferred Stock, without par value, and any other class of stock of the Corporation having preferential rights as to the payment of dividends or to the distribution of assets in liquidation and in subordination thereto, the holders of shares of the Common Stock alone shall receive all further dividends and shares in distribution of assets.
D. CERTAIN VOTING RIGHTS AND RESTRICTIONS UPON CORPORATION ACTION.
Subject to the requirements of law, the voting rights of the shareholders are as follows:
1. At all meetings of the shareholders (a) each holder of shares of
the 4% Preferred Stock shall be entitled to 20 votes for each such share held by
him, (b) each holder of shares of the Serial Preferred Stock, $100 par value,
and the Serial Preferred Stock, without par value, shall be entitled to such
vote, if any, for each such share held by him as shall have been granted to the
shareholders of the respective series by resolution of the Board of Directors
establishing that series, and (c) each holder of shares of the Common Stock
shall be entitled to one vote for each such share held by him, and each such
shareholder may vote or otherwise act either in person or by proxy; provided,
that (x) whenever and as often as dividends payable on the 4% Preferred Stock
shall be accumulated and unpaid in an amount equivalent to or exceeding four
quarterly dividends, the holders of shares of the 4% Preferred Stock shall be
entitled thereafter at each succeeding annual meeting of the shareholders to
elect the smallest number of directors necessary to constitute a majority of the
Board of Directors, and the remaining directors, subject to the rights of the
holders of the Serial Preferred Stock, without par value, set forth in clause
(z) below, shall be elected, as usual, by the holders of shares of the voting
stock of the Corporation without distinction as to class, until all such
accumulated unpaid dividends shall have been eliminated, (y) if and when the
profits available for dividends are in excess of such accumulated and unpaid
dividends on the 4% Preferred Stock, the declaration and payment of such
dividends shall not be unreasonably withheld, and (z) whenever and as often as
dividends payable on the Serial Preferred Stock, without par value, shall be
accumulated and unpaid in an amount equivalent to or exceeding six quarterly
dividends, the holders of the shares thereof shall be entitled thereafter, at
such succeeding annual meeting of the shareholders at which the holders of a
majority of the Serial Preferred Stock, without par value, are present and
voting in person or by proxy, to elect two directors from among those directors
who would otherwise be
elected by the holders of shares of the voting stock of the Corporation without distinction as to class, and the remaining directors, subject to the rights of the holders of the 4% Preferred Stock set forth in clause (x) above, shall be elected as usual by the holders of the voting shares of the Corporation without distinction as to class, until all such accumulated and unpaid dividends shall have been eliminated.
2. The Corporation shall not mortgage any of its fixed assets without the approval of the holders of a majority of the shares of the Common Stock and the holders of a majority of the shares of the 4% Preferred Stock as are present at an annual or special meeting of the shareholders at which a quorum is present, the notice of which meeting shall have contained a statement of such proposal; provided, that such approval shall not be required in connection with anything required or permitted to be done under the Corporation's Mortgage and Deed of Trust, dated as of October 1, 1937.
3. The authorized stock of the Corporation shall not be increased
except as follows: (i) the authorized Common Stock may be increased at any time
upon the affirmative vote of the holders of shares of the 4% Preferred Stock and
the Common Stock entitling them to exercise a majority of the voting power;
(ii) the authorized 4% Preferred Stock may be increased, and any additional
class of stock ranking PARI PASSU with the 4% Preferred Stock may be authorized,
at any time, upon the affirmative vote of the holders of shares of the 4%
Preferred Stock and the Common Stock entitling them to exercise a majority of
the voting power, provided, that such vote shall include the affirmative vote of
the holders of a majority of the voting power of the outstanding shares of the
4% Preferred Stock; (iii) and any class of stock having preference over the 4%
Preferred Stock as to dividends or distribution of assets may be authorized upon
the affirmative vote of the holders of shares of the 4% Preferred Stock and
Common Stock entitling them to exercise a majority of the voting power, provided
that such vote shall include the affirmative vote of the holders of two-thirds
of the voting power of the outstanding shares of the 4% Preferred Stock.
4. So long as any shares of the 4% Preferred Stock shall remain outstanding, no shares of the 4% Preferred Stock in excess of 60,587 shares and no shares of stock of any class having relative rights and preferences equal or superior to the relative rights and preferences of the 4% Preferred Stock with respect to the payment of dividends or the distribution of assets in liquidation shall be issued without the affirmative vote of the holders of a majority of the voting power of the outstanding shares of the 4% Preferred Stock, unless the earnings of the Corporation, for any twelve consecutive months within the fifteen calendar months next preceding any such proposed transaction, available for payment of interest on the Corporation's indebtedness (after deduction of depreciation and all taxes) shall equal or exceed one and three-quarters (1-3/4) times the
aggregate of the Corporation's annual interest and preferred dividend requirements after the proposed transaction. In making such calculations, there may be included the earnings prior to the acquisition of any electric utility property to be acquired from the proceeds of such shares to be issued.
5. So long as any shares of the Serial Preferred Stock, $100 par value, shall remain outstanding, no shares of the Serial Preferred Stock, $100 par value, or of any class of stock having relative rights and preferences equal or superior to the relative rights and preferences of the Serial Preferred Stock, $100 par value, with respect to the payment of dividends or the distribution of assets in liquidation shall be issued without the affirmative vote of the holders of a majority of the then outstanding shares of the Serial Preferred Stock, $100 par value, other than to refinance an equal par amount or stated value of shares of the Serial Preferred Stock, $100 par value, and any other class of stock having relative rights and preferences equal or superior to the aforesaid relative rights and preferences of the Serial Preferred Stock, $100 par value, unless the gross income of the Corporation for a period of twelve (12) consecutive calendar months within the fifteen (15) calendar months immediately preceding such issuance, determined in accordance with generally accepted accounting practices (but in any event after deducting all taxes and depreciation) shall have been at least at one and one-half (1-1/2) times the sum of (i) the annual interest charges on all interest bearing indebtedness of the Corporation outstanding in the hands of the public, and (ii) the annual dividend requirements on all outstanding shares of the Serial Preferred Stock, $100 par value, and any other class of stock of the Corporation having relative rights and preferences equal or superior to the aforesaid relative rights and preferences of the Serial Preferred Stock, $100 par value, including the shares proposed to be issued; provided, that there shall be excluded from the foregoing computation interest charges on all indebtedness and dividends on all shares of the Serial Preferred Stock, $100 par value, or any other class of stock of the Corporation having relative rights and preferences equal or superior to the aforesaid relative rights and preferences of the Serial Preferred Stock, $100 par value, which are to be retired in connection with the issue of such additional shares; and provided further, that in any case where such additional shares of the Serial Preferred Stock, $100 par value, or any other class of stock of the Corporation having relative rights and preferences equal or superior to the aforesaid relative rights and preferences of the Serial Preferred Stock, $100 par value, are to be issued in connection with the acquisition of additional public utility property, the gross income of the property to be so acquired, computed on the same basis as the gross income of the Corporation, may be included on a PRO FORMA basis in making the foregoing computation.
6. No amendment of the provisions of subsections D.1. or 2. of this Article shall be made without the consent of the
holders of at least two-thirds of the outstanding shares of the 4% Preferred Stock, which consent may be expressed by each such shareholder either in writing or by vote at an annual or special shareholders' meeting.
7. No amendment of the provisions of (i) subsections C.1. (a), (b) or (c), (ii) the second sentence of subsection C.4., or (iii) subsections D.3. and 4., of this Article, which shall adversely affect the rights of the holders of outstanding shares of the 4% Preferred Stock or Common Stock as set forth in such provisions, shall be made without the consent of the holders of all of the outstanding shares of the 4% Preferred Stock and Common Stock outstanding at the time of such amendment, which consent may be expressed by each shareholder either in writing or by vote at an annual or special shareholders' meeting.
8. The holders of shares of the Serial Preferred Stock, $100 par value, or of the Serial Preferred Stock, without par value, are not entitled to vote as such shareholders, on any matter, except (i) as expressly provided herein, (ii) as shall be provided by the Board of Directors in its resolutions establishing each series thereof, and (iii) as expressly required by law.
9. The shareholders shall not have the right to cumulate votes in the election of directors.
ARTICLE 7. CONVERTIBLE BONDS AND DEBENTURES. The Corporation may issue bonds and debentures convertible into other bonds, other debentures or shares of stock of the Corporation within such period and upon such terms and conditions as shall be fixed by the Board of Directors.
ARTICLE 8. BUSINESS COMBINATIONS.
Part I. For the purposes of this ARTICLE 8, the following terms shall have the meanings hereinafter set forth:
(a) "Affiliate" or "Associate" shall have the respective meaning ascribed to such terms in the General Rules and Regulations under the Securities Exchange Act of 1934 as in effect on January 1, 1986.
(b) A person shall be a "Beneficial Owner" of any Voting Stock:
(i) which such person or any of its Affiliates or Associates (as herein defined) beneficially owns, directly or indirectly; or
(ii) which such person or any of its Affiliates or Associates has (A) the right to acquire (whether such right is exercisable immediately or only after the passage of time), pursuant to any agreement, arrangement or understanding or upon
the exercise of conversion rights, exchange rights, warrants or options, or otherwise, or (B) the right to vote pursuant to any agreement, arrangement or understanding; or
(iii) which is beneficially owned, directly or indirectly, by any other person with which such person or any of its Affiliates or Associates has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of any shares of Voting Stock.
(c) "Business Combination" shall mean any of the following:
(i) any merger or consolidation of the Corporation or any Subsidiary with (A) any Interested Shareholder, or (B) any other corporation (whether or not itself an Interested Shareholder) which is, or after such merger or consolidation would be, an Affiliate of an Interested Shareholder; or
(ii) any sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one transaction or a series of transactions) to or with any Interested Shareholder or any Affiliate of any Interested Shareholder of any assets of the Corporation or any Subsidiary having an aggregate Fair Market Value of $5,000,000 or more but shall not include transactions between the Corporation and its Subsidiaries; or
(iii) the issuance or transfer by the Corporation or any Subsidiary (in one transaction or a series of transactions) of any securities of the Corporation or any Subsidiary to any Interested Shareholder or any Affiliate of any Interested Shareholder in exchange for cash, securities or other property (or a combination thereof) having an aggregate Fair Market Value of $5,000,000 or more; or
(iv) the adoption of any plan or proposal for the liquidation or dissolution of the Corporation proposed by or on behalf of an Interested Shareholder or any Affiliate of any Interested Shareholder; or
(v) any reclassification of securities (including any reverse stock split), or recapitalization of the Corporation, statutory share exchange, or any merger or consolidation of the Corporation with any of its Subsidiaries or any other transaction (whether or not with or into or otherwise involving an Interested Shareholder) which has the effect, directly or indirectly, of increasing the proportionate share of the outstanding shares of any class of equity or convertible securities of the Corporation or any Subsidiary which is directly or indirectly owned by an Interested Shareholder or any Affiliate of any Interested Shareholder.
(d) "Continuing Director" shall mean any member of the Board of Directors of the Corporation (the "Board") who is unaffiliated with, and not a nominee of, the Interested Shareholder (as such term is used in the context of a Business Combination) and was a member of the Board prior to the time that the Interested Shareholder became an Interested Shareholder and any successor of a Continuing Director who is unaffiliated with, and not a nominee of, the Interested Shareholder and is designated to succeed a Continuing Director by two-thirds of Continuing Directors then on the Board.
(e) "Fair Market Value" means:
(i) in the case of stock, the highest closing sale price during the thirty-day period immediately preceding the date in question of a share of such stock on the Composite Tape for the New York Stock Exchange -- Listed Stocks, or, if such stock is not quoted on the Composite Tape for the New York Stock Exchange, or, if such stock is not listed on such Exchange, on the principal United States securities exchange registered under the Securities Exchange Act of 1934 on which such stock is listed, or, if such stock is not listed on any such exchange, the highest last bid quotation with respect to a share of such stock during the thirty-day period preceding the date in question on the National Association of Securities Dealers, Inc. Automated Quotations System ("NASDAQ") or the NASDAQ National Market System or, if NASDAQ and the NASDAQ National Market System are not then in use, any other system then in use, or, if no such quotations are available, the fair market value on the date in question of a share of such stock as determined by two-thirds of the Continuing Directors in good faith; and
(ii) in the case of property other than cash or stock, the fair market value of such property on the date in question as determined by a majority of the Continuing Directors in good faith.
(f) "Institutional Voting Stock" shall mean any class or series of Voting Stock which was issued to and continues to be held solely by one or more insurance companies, pension funds, commercial banks, savings banks and/or similar financial institutions or institutional investors.
(g) "Interested Shareholder" shall mean any person (other than the Corporation or any Subsidiary) who or which:
(i) is the Beneficial Owner, directly or indirectly, of more than 10 percent of the voting power of the then outstanding Voting Stock; or
(ii) is an Affiliate of the Corporation and at any time within the two-year period immediately prior to the date in question became the Beneficial Owner, directly or indirectly,
of 10 percent or more of the voting power of the then outstanding Voting Stock; or
(iii) is an assignee of or has otherwise succeeded to any shares of Voting Stock which were at any time within the two-year period immediately prior to the date in question beneficially owned by any Interested Shareholder, if such assignment or succession shall have occurred in the course of a transaction or series of transactions not involving a public offering within the meaning of the Securities Act of 1933.
For the purpose of determining whether a person is an Interested Shareholder pursuant to this paragraph (g), the number of shares of Voting Stock deemed to be outstanding shall include shares deemed owned through application of paragraph (b) of this Part I but shall include any other shares of Voting Stock which may be issuable pursuant to any agreement, arrangement or understanding, or upon exercise of conversion rights, warrants or options, or otherwise.
(h) In the event of any Business Combination in which the Corporation survives, the phrase "consideration other than cash to be received" as used in Sections (a) and (b) of Part II of this ARTICLE 8 shall include the shares of Common Stock and/or the shares of any other class of outstanding Voting Stock retained by the holders of such shares.
(i) A "person" shall mean any individual, firm, partnership, trust, corporation or other entity.
(j) "Subsidiary" means any corporation of which a majority of any class of equity security is owned, directly or indirectly, by the Corporation; provided, however, that for the purposes of the definition of Interested Shareholder set forth in paragraph (g) of this Part I, the term "Subsidiary" shall mean only a corporation of which a majority of each class of equity security is owned, directly or indirectly, by the Corporation.
(k) "Voting Stock" shall mean each share of stock of the Corporation generally entitled to vote in elections of directors.
A majority of the Continuing Directors of the Corporation shall have the power and duty to determine, for the purposes of this ARTICLE 8, on the basis of information known to them after reasonable inquiry, all facts necessary to determine the applicability of the various provisions of this ARTICLE 8. Any such determination made in good faith shall be binding and conclusive on all parties.
Part II. Except as otherwise expressly provided in Part III of this ARTICLE 8 and in addition to any other provision of law and as may otherwise be set forth in these Restated Articles of
Incorporation, the consummation of any Business Combination shall require that all of the following conditions shall have been met:
(a) The aggregate amount of the cash and the Fair Market Value as of the date of the consummation of the Business Combination of consideration other than cash to be received per share by holders of Common Stock in such Business Combination shall be at least equal to the highest of the following:
(i) (if applicable) the highest per share price (including any brokerage commissions, transfer taxes and soliciting dealers' fees) paid by the Interested Shareholder for any shares of Common Stock acquired by it (A) within the two-year period immediately prior to the first public announcement of the proposal of the Business Combination (the "Announcement Date") or (B) in the transaction in which it became an Interested Shareholder, whichever is highest;
(ii) the Fair Market Value per share of Common Stock on the Announcement Date or on the date on which the Interested Shareholder became an Interested Shareholder (such latter date is referred to in this ARTICLE 8 as the "Determination Date"), whichever is higher; and
(iii) (if applicable) the price per share equal to the Fair Market Value per share of Common Stock determined pursuant to paragraph (ii) above, multiplied by the ratio of (A) the highest per share price (including any brokerage commissions, transfer taxes and soliciting dealers' fees) paid by the Interested Shareholder for any shares of Common Stock acquired by it within the two-year period immediately prior to the Announcement Date to (B) the Fair Market Value per share of Common Stock on the first day in such two-year period upon which the Interested Shareholder acquired any shares of Common Stock.
(b) The aggregate amount of the cash and the Fair Market Value as of the date of the consummation of the Business Combination of consideration other than cash to be received per share by holders of shares of any class of outstanding Voting Stock other than Common Stock (and excluding any series or class of Institutional Voting Stock), shall be at least equal to the highest of the following (it being intended that the requirements of this paragraph (b) shall be required to be met with respect to every such class of outstanding Voting Stock, whether or not the Interested Shareholder has previously acquired any shares of a particular class of Voting Stock):
(i) (if applicable) the highest per share price (including any brokerage commissions, transfer taxes and soliciting dealers' fees) paid by the Interested Shareholder for any shares of such class of Voting Stock acquired by it (A) within the two-year period immediately prior to the Announcement Date, or (B) in the transaction in which it became an Interested Shareholder, whichever is higher;
(ii) (if applicable) the highest preferential amount per share to which the holders of shares of such class of Voting Stock are entitled in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Corporation;
(iii) the Fair Market Value per share of such class of Voting Stock on the Announcement Date or on the Determination Date, whichever is higher; and
(iv) (if applicable) the price per share equal to the Fair Market
Value per share of such class of Voting Stock determined pursuant to paragraph
(iii) above, multiplied by the ratio of (A) the highest per share price
(including any brokerage commissions, transfer taxes and soliciting dealers'
fees) paid by the Interested Shareholder for any shares of such class of Voting
Stock acquired by it within the two-year period immediately prior to the
Announcement Date to (B) the Fair Market Value per share of such class of Voting
Stock on the first day in such two-year period upon which the Interested
Shareholder acquired any shares of such class of Voting Stock.
(c) The consideration to be received by holders of a particular class of outstanding Voting Stock (including Common Stock) shall be in cash or in the same form as the Interested Shareholder has previously paid for shares of such class of Voting Stock. If the Interested Shareholder has paid for shares of any class of Voting Stock with varying forms of consideration, the form of consideration for such class of Voting Stock shall be either cash or the form used to acquire the largest number of shares of such class of Voting Stock previously acquired by it.
(d) After such Interested Shareholder has become an Interested Shareholder and prior to the consummation of such Business Combination:
(i) except as approved by two-thirds of the Continuing Directors, there shall have been no failure to declare and pay at the regular date therefor any full quarterly dividends (whether or not cumulative) on the outstanding 4% Preferred Stock, Serial Preferred Stock, $100 par value, or Serial Preferred Stock, without par value;
(ii) there shall have been (A) no reduction in the annual rate of dividends paid on the Common Stock (except as necessary to reflect any subdivision of the Common Stock), except as approved by two-thirds of the Continuing Directors, and (B) an increase in such annual rate of dividends as necessary to reflect any reclassification (including any reverse stock split), recapitalization, reorganization or any similar transaction which has the effect of reducing the number of outstanding shares of the Common Stock, unless the failure so to increase such annual rate is approved by two-thirds of the Continuing Directors; and
(iii) such Interested Shareholder shall have not become the beneficial owner of any additional shares of Voting Stock except as part of the transaction which results in such Interested Shareholder becoming an Interested Shareholder.
(e) After such Interested Shareholder has become an Interested Shareholder, such Interested Shareholder shall not have received the benefit, directly or indirectly (except proportionately as a shareholder), of any loans, advances, guarantees, pledges or other financial assistance or any tax credits or other tax advantages provided by the Corporation, whether in anticipation of or in connection with such Business Combination or otherwise.
(f) A proxy or information statement describing the proposed Business Combination and containing the information specified for proxy or information statements under the Securities Exchange Act of 1934 and the rules and regulations thereunder (or any subsequent provisions replacing such Act, rules or regulations) shall be mailed to shareholders of the Corporation at least thirty days prior to the consummation of such Business Combination (whether or not such proxy or information statement is required to be mailed pursuant to such Act or subsequent provisions).
Part III. Unless the Business Combination shall have been approved by
two-thirds of the Continuing Directors, (a) the provisions of Part II of this
ARTICLE 8 shall be applicable to each particular Business Combination, and
(b) any such Business Combination shall be approved by the affirmative vote of
at least four-fifths of the voting power of all shares of Voting Stock
(considered for purposes of this ARTICLE 8 as one class, it being understood
that for purposes of this ARTICLE 8, each share of Voting Stock shall have the
number of votes granted to it pursuant to ARTICLE 6 of these Restated Articles
of Incorporation.
Part IV. Nothing contained in this ARTICLE 8 shall be construed to relieve any Interested Shareholder from any fiduciary obligation imposed by law.
ARTICLE 9. SPECIAL MEETINGS OF SHAREHOLDERS. Special meetings of shareholders of the Corporation may be called only by the Chairman of the Board of Directors, the President, a majority of the Board of Directors, or the holders of not less than four-fifths of the shares entitled to vote at the meeting.
ARTICLE 10. AMENDMENTS. Notwithstanding anything to the contrary contained in these Restated Articles of Incorporation or the By-laws of the Corporation (and notwithstanding the fact that a lesser percentage may be specified by law, these Restated Articles of Incorporation or the By-laws of the Corporation), the affirmative vote of the holders or at least four-fifths of the
voting power of the then outstanding Voting Stock shall be required to amend, alter, change or repeal, or to adopt any provision inconsistent with, ARTICLES 4, 8, 9 and 10 of these Restated Articles of Incorporation, provided that such four-fifths vote shall not be required for any amendment, alteration, change or repeal recommended to the shareholders by two-thirds of the Continuing Directors, as defined in ARTICLE 8.
ARTICLE 11. AMENDMENT OF BY-LAWS. The Corporation's By-laws may be amended or repealed or new by-laws may be made: (a) by the affirmative vote of the holders of record of a majority of the outstanding capital stock of the Corporation entitled to vote thereon, irrespective of class, given at any annual or special meeting of the shareholders; provided that notice of the proposed amendment, repeal or new by-law or by-laws be included in the notice of such meeting or waiver thereof; or (b) by the affirmative vote of a majority of the entire Board of Directors given at any regular meeting of the Board, or any special meeting thereof.
ARTICLE 12. LIMITATION OR ELIMINATION OF DIRECTOR LIABILITY. No Director of the Corporation shall be personally liable to the Corporation or its shareholders for monetary damages for breach of fiduciary duty as a Director; provided that this Article shall not limit or eliminate the liability of a Director for any act or omission for which such limitation or elimination of liability is not permitted under the Idaho Business Corporation Act. No amendment to the Idaho Business Corporation Act that further limits or eliminates the acts or omissions for which limitation or elimination of liability is permitted shall affect the liability of a Director for any act or omission which occurs prior to the effective date of such amendment.
CERTIFICATION
THE FOREGOING RESTATED ARTICLES OF INCORPORATION of Idaho Power Company constitute a full and complete amendment of each and every Article of Incorporation of Idaho Power Migrating Corporation, (a corporation created to effect the migration of Idaho Power Company's state of incorporation from Maine to Idaho which, following completion of the migration, shall be called Idaho Power Company, an Idaho corporation), as approved by the sole shareholder, Idaho Power Company, on June 22, 1989, and by the shareholders of Idaho Power Company at its annual meeting on May 3, 1989. The undersigned does hereby certify that the above constitutes a full, true and correct copy of the Restated Articles of Incorporation of Idaho Power Company as of the date indicated below, and that said Articles have not been amended or rescinded and are in full force and effect on the date hereof.
DATED this 30th day of June, 1989.
/s/ W W Anderson ----------------------------------- W W Anderson President & Chief Operating Officer Idaho Power Company |
ATTEST
/s/ Robert W Stahman ------------------------- Robert W Stahman Secretary |
Exhibit 3(e)
STATEMENT OF RESOLUTION
ESTABLISHING TERMS OF NEW PREFERRED STOCK
FIRST: The name of the corporation is Idaho Power Company (the
"Corporation").
SECOND: The following resolution, establishing and designating a series of
shares and fixing and determining certain of the relative rights and
preferences thereof, was duly adopted by the Board of Directors of the
Corporation on October 30, 1991.
RESOLVED, That pursuant to Section 30-1-16 of the Idaho Business
|
Corporation Act and to the power vested in the Board of Directors by Article
6.C.3 of the Restated Articles of Incorporation, as amended, of the Corporation,
the third series of the Corporation's Serial Preferred Stock, Without Par Value,
is hereby created and the Restated Articles of Incorporation, as amended, of the
Corporation are further amended by the addition to the provisions of Article
6.C.3 of such Restated Articles of Incorporation, as amended, of the following
paragraph (e) immediately before the heading "4. Common Stock":
e. FLEXIBLE AUCTION SERIES A, SERIAL PREFERRED STOCK, WITHOUT PAR VALUE. There is hereby created the third series of the Corporation's Serial Preferred Stock, Without Par Value, which shall be designated as the Flexible Auction Series A, Serial Preferred Stock, Without Par Value (hereafter in this paragraph (e) referred to as the "Auction Preferred Stock"), which consists of 500 shares. The rights and preferences of the shares of said series, in those respects in which the shares thereof may vary from shares of other series, shall be as follows:
PART I
(i) As used in this paragraph (e) the following terms shall have the following meanings, whether used in the singular or plural, unless the context or use indicates another or different meaning or intent:
"APPLICABLE 'AA' COMPOSITE COMMERCIAL PAPER RATE", as of any date and with respect to any Long-Term Dividend Period, shall mean (a) in the case of any Long-Term Dividend Period having a term less than 70 days, the interest
equivalent of the 60-day rate, (b) in the case of any Long-Term Dividend Period having a term 70 days or more but less than 85 days, the arithmetic average of the interest equivalent of the 60-day and 90-day rates, (c) in the case of any Long-Term Dividend Period having a term 85 days or more but less than 120 days, the interest equivalent of the 90-day rate, (d) in the case of any Long-Term Dividend Period having a term 120 days or more but less than 148 days, the arithmetic average of the interest equivalent of the 90-day and 180-day rates, (e) in the case of any Long-Term Dividend Period having a term 148 days or more but less than 210 days, the interest equivalent of the 180-day rate, (f) in the case of any Long-Term Dividend Period having a term 210 days or more but less than 238 days, the arithmetic average of the interest equivalent of the 180-day and 270-day rates, and (g) in the case of any Long-Term Dividend Period having a term 238 or more days, the interest equivalent of the 270-day rate, on commercial paper placed on behalf of issuers whose corporate bonds are rated "AA" by S&P or "Aa" by Moody's, or the equivalent of either or both of such ratings by such agencies or such rating by another rating agency, as made available on a discount basis or otherwise, by the Federal Reserve Bank of New York for the Business Day immediately preceding such date or in the event that the Federal Reserve Bank of New York does not make available any such rate, then the arithmetic average of such rates, as quoted on a discount basis or otherwise by the Commercial Paper Dealers, to the Trust Company for the close of business on the Business Day next preceding such date. If any Commercial Paper Dealer does not quote a rate required to determine the "AA" Composite Commercial Paper Rate, the "AA" Composite Commercial Paper Rate shall be determined on the basis of the quotation or quotations furnished by the remaining Commercial Paper Dealer and any Substitute Commercial Paper Dealer or Substitute Commercial Paper Dealers selected by the Corporation to provide such rate or rates not being supplied by any Commercial Paper Dealer or Commercial Paper Dealers, as the case may be, or, if the Corporation does not select any such Substitute Commercial Paper Dealer or Substitute Commercial Paper Dealers, by the remaining Commercial Paper Dealer. For the purpose of this definition, any arithmetic average shall be rounded to the nearest one-thousandth (.001) of one percent.
"APPLICABLE RATE" means the rate per annum in effect from time to time at which dividends on the Auction Preferred Stock are payable during Dividend Periods subsequent to the initial Dividend Period, as provided in paragraph (ii)(B) below.
"APPLICABLE TREASURY RATE" as of any date and with respect to Auction Preferred Stock with a Long-Term Dividend Period of one year or more, means the interest equivalent of the rate for direct obligations of the United States Treasury having an original maturity which is equal to, or next lower than, the length of such Long-Term Dividend Period, as published weekly by the Federal Reserve Board in "Federal Reserve Statistical Release H.15(519)-Selected Interest Rates", or any successor publication by the Federal Reserve Board within five Business Days preceding such date. In the event that the Federal Reserve Board does not publish such weekly per annum interest rate, or if such release is not yet available, the Applicable Treasury Rate will be the arithmetic average of the secondary market bid rates as of approximately 3:30 p.m., New York City time, on the Business Day next preceding such date, of the U.S. Government Securities Dealers obtained by the Trust Company (or, under certain circumstances, the Corporation) for the issue of direct obligations of the United States Treasury, in an aggregate principal amount of at least $1,000,000, with a remaining maturity equal to, or next lower than, the length of such Long- Term Dividend Period. If any U.S. Government Securities Dealer does not quote a rate required to determine the Applicable Treasury Rate, the Applicable Treasury Rate shall be determined on the basis of the quotation or quotations furnished by the remaining U.S. Government Securities Dealer or any Substitute U.S. Government Securities Dealer or Substitute U.S. Government Securities Dealers selected by the Corporation to provide such rate or rates not being supplied by any U.S. Government Securities Dealer or U.S. Government Securities Dealers, as the case may be, or, if the Corporation does not select any such Substitute U.S. Government Securities Dealer or Substitute U.S. Government Securities Dealers, by the remaining U.S. Government Securities Dealer; provided, that in the event the Corporation is unable to cause such quotations to be furnished to the Trust Company (or, if applicable, the Corporation) by such sources, the Corporation may cause the Applicable Treasury Rate to be furnished to the Trust Company (or, if applicable, the Corporation) by such alternative source or sources as the Corporation in good faith deems to be reliable. For the purpose of this definition, any arithmetic average shall be rounded to the nearest one-thousandth (.001) of one percent.
"AUCTION" means each periodic implementation of the Auction Procedures.
"AUCTION DATE" means the Business Day next preceding the first day of each Dividend Period after the initial Dividend Period.
"AUCTION PROCEDURES" means the procedures for conducting Auctions set forth in Part II.
"BUSINESS DAY" means a day on which the New York Stock Exchange is open for trading and which is not a day on which banking institutions in New York City are authorized or required by law or executive order to close.
"CHARTER" means the Corporation's Restated Articles of Incorporation, as amended.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMMERCIAL PAPER DEALERS" means Goldman, Sachs & Co. and Shearson Lehman Brothers Inc. or, in lieu thereof, their respective successors or affiliates.
"CORPORATION" means Idaho Power Company, a corporation of the State of Idaho, or its successors.
"DATE OF ORIGINAL ISSUE" means the date on which the Corporation originally issues the Auction Preferred Stock.
"DEFAULT RATE" has the meaning set forth in paragraph (ii)(B) below.
"DIVIDEND PAYMENT DATE" has the meaning set forth in paragraph
(ii)(A)(6) below.
"DIVIDEND PERIOD" has the meaning set forth in paragraph (ii)(A)(7) below.
"DIVIDEND PERIOD DAYS" has the meaning set forth in paragraph
(ii)(A)(5) below.
"DIVIDEND QUARTER" has the meaning set forth in paragraph (ii)(A)(6) below.
"DIVIDEND RATE" means the rate per annum in effect from time to time at which dividends on the Auction Preferred Stock are payable as provided in paragraphs (ii)(A) and (B) below.
"DIVIDENDS-RECEIVED DEDUCTION" has the meaning set forth in paragraph
(ii)(A)(4) below.
"EXISTING HOLDER" of any shares of Auction Preferred Stock means a person who has signed a Master Purchaser's
Letter and is listed as the beneficial owner of such shares of Auction Preferred Stock in the records of the Trust Company.
"INITIAL DIVIDEND PAYMENT DATE" means the date specified in paragraph
(ii)(A)(7) below.
"INITIAL DIVIDEND PERIOD" has the meaning set forth in paragraph
(ii)(A)(7) below.
"INTEREST EQUIVALENT" means the equivalent yield on a 360-day basis of a discount-basis security to an interest-bearing security.
"LATE CHARGE" has the meaning set forth in paragraph (ii)(B) below.
"LONG-TERM DIVIDEND PERIOD" means any Dividend Period designated by the Corporation pursuant to paragraph (ii)(A)(8) below which may be any period greater than 49 days and consisting of a number of days evenly divisible by seven (or such number of days as shall result from the adjustment set forth in paragraph (ii)(A)(5) below) but not exceeding 25 years.
"MASTER PURCHASER'S LETTER" means a letter from a prospective purchaser of Auction Preferred Stock in which such prospective purchaser agrees to certain conditions.
"MAXIMUM APPLICABLE RATE" means (a) in the case of a Short-Term Dividend Period, a per annum rate equal to the Rate Multiple multiplied by the 60-day "AA" Composite Commercial Paper Rate in effect on the related Auction Date and (b) in the case of a Long-Term Dividend Period, a per annum rate equal to the Rate Multiple multiplied by the Reference Rate in effect on the related Auction Date, but, in either case, such rate shall not exceed 16% per annum.
"MINIMUM HOLDING PERIOD" has the meaning set forth in paragraph
(ii)(A)(4) below.
"MOODY'S" means Moody's Investors Service, Inc., or its successor, so long as such agency (or successor) is in the business of rating securities of the type of the Auction Preferred Stock.
"NORMAL DIVIDEND PAYMENT DATE" has the meaning set forth in paragraph
(ii)(A)(1) below.
"NOTICE OF LONG-TERM DIVIDEND PERIOD" has the meaning set forth in paragraph (ii)(A)(8) below.
"NOTICE OF REVOCATION" has the meaning set forth in paragraph
(ii)(A)(8) below.
"RATE MULTIPLE", when used with respect to shares of Auction Preferred Stock on an Auction Date, means the percentage, determined as set forth below, based on the prevailing rating of the Auction Preferred Stock in effect at the close of business on the Business Day immediately preceding such Auction Date:
PREVAILING RATING RATE
MULTIPLE
AA/aa or Above . . . . . . . . . . . . . . . . . 120%
A/a. . . . . . . . . . . . . . . . . . . . . . . 175%
BBB/baa. . . . . . . . . . . . . . . . . . . . . 200%
Below BBB/baa. . . . . . . . . . . . . . . . . . 250%
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For purposes of this definition, the "prevailing rating" of Auction Preferred Stock shall be (a) AA/aa or Above, if the Auction Preferred Stock has a rating of AA- or better by S&P and aa3 or better by Moody's, or the equivalent of both of such ratings by such agencies or a substitute rating agency or substitute rating agencies selected as provided below, (b) if not AA/aa or Above, then A/a, if the Auction Preferred Stock has a rating of A- or better by S&P and a3 or better by Moody's or the equivalent of both of such ratings by such agencies or a substitute rating agency or substitute rating agencies selected as provided below, (c) if not AA/aa or Above or A/a, then BBB/baa, if the Auction Preferred Stock has a rating of BBB- or better by S&P and baa3 or better by Moody's or the equivalent of both of such ratings by such agencies or a substitute rating agency or substitute rating agencies selected as provided below, and (d) if not AA/aa or Above, A/a or BBB/baa, then Below BBB/baa. For purposes of the foregoing, the "prevailing rating" of the Auction Preferred Stock will be based upon the lower of two ratings provided by S&P and Moody's or a substitute rating agency or agencies. The Corporation shall take all reasonable action necessary to enable S&P and Moody's to provide a rating for the Auction Preferred Stock. If either or both of S&P or Moody's shall not make such a rating available, the Corporation shall select a nationally recognized statistical rating organization (as that term is used in the rules and regulations of the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended) or two
nationally recognized statistical rating organizations to act as substitute rating agency or substitute rating agencies, as the case may be.
"REFERENCE RATE" means, as of any date and with respect to any Long-Term Dividend Period having a term of (a) 50 days or more and less than 270 days, the Applicable "AA" Composite Commercial Paper Rate, (b) 270 days or more and less than one year, the higher of the 270-day Applicable "AA" Composite Commercial Paper Rate and the one-year Applicable Treasury Rate and (c) one year or more, the Applicable Treasury Rate.
"S&P" means Standard & Poor's Corporation, or its successor, so long as such agency (or successor) is in the business of rating securities of the type of the Auction Preferred Stock.
"SECURITIES DEPOSITORY" means The Depository Trust Company, together with any successor securities depository selected by the Corporation which agrees to follow the procedures required to be followed by such securities depository in connection with shares of Auction Preferred Stock.
"SEVEN-DAY DIVIDEND PERIOD" means a Dividend Period arising under the circumstances set forth in paragraph (ii)(A)(9) below.
"SHORT-TERM DIVIDEND PERIOD" has the meaning set forth in paragraph
(ii)(A)(7) below.
"60-DAY 'AA' COMPOSITE COMMERCIAL PAPER RATE", as of any date and with respect to any Short-Term Dividend Period, means (a) the interest equivalent of the 60-day rate on commercial paper placed on behalf of issuers whose corporate bonds are rated "AA" by S&P or "Aa" by Moody's or the equivalent of either or both of such ratings by such agencies or another rating agency, as such 60-day rate is made available on a discount basis or otherwise by the Federal Reserve Bank of New York for the Business Day immediately preceding such date, or (b) in the event that the Federal Reserve Bank of New York does not make available such a rate, then the arithmetic average of the interest equivalent of the 60-day rate on commercial paper placed on behalf of such issuers, as quoted on a discount basis or otherwise by the Commercial Paper Dealers to the Trust Company for the close of business on the Business Day immediately preceding such date. If any Commercial Paper Dealer does not quote a rate required to determine the
60-day "AA" Composite Commercial Paper Rate, the 60-day "AA" Composite Commercial Paper Rate shall be determined on the basis of the quotation or quotations furnished by the remaining Commercial Paper Dealer and any Substitute Commercial Paper Dealer or Substitute Commercial Paper Dealers selected by the Corporation to provide such rate or rates not being supplied by any Commercial Paper Dealer or Commercial Paper Dealers, as the case may be, or, if the Corporation does not select any such Substitute Commercial Paper Dealer or Substitute Commercial Paper Dealers, by the remaining Commercial Paper Dealer. If the Board of Directors of the Corporation, however, shall adjust the number of Dividend Period Days, in the event of a change in the Minimum Holding Period, then (a) if the Dividend Period Days shall be fewer than 70 days, such rate shall be the interest equivalent of the 60-day rate on such commercial paper, (b) if the Dividend Period Days shall be 70 or more days but fewer than 85 days, such rate shall be the arithmetic average of the interest equivalent of the 60-day and 90-day rates on such commercial paper and (c) if the Dividend Period Days shall be 85 or more days but fewer than 99 days, such rate shall be the interest equivalent of the 90-day rate on such commercial paper. For the purpose of this definition, any arithmetic average shall be rounded to the nearest one-thousandth (.001) of one percent.
"SUBSTITUTE COMMERCIAL PAPER DEALER" means any commercial paper dealer, the principal office of which is located in New York City, that is a nationally recognized leading dealer in the domestic commercial paper market, provided that no such dealer may be the Corporation or an affiliate of the Corporation.
"SUBSTITUTE U.S. GOVERNMENT SECURITIES DEALER" means any dealer in United States Treasury obligations, the principal office of which is located in New York City, that is a nationally recognized leading dealer in the market for United States Treasury obligations, provided that no such dealer may be the Corporation or an affiliate of the Corporation.
"TRUST COMPANY" means Bankers Trust Company, together with any successor bank or trust company or other entity entering into an agreement similar to that between Bankers Trust Company and the Corporation.
"U.S. GOVERNMENT SECURITIES DEALER" means Goldman, Sachs & Co. and Shearson Lehman Brothers Inc., or, in lieu thereof, their respective affiliates or successors.
(ii) DIVIDENDS. (A) The rate of dividend on shares of the Auction Preferred Stock is hereby fixed and determined at the dividend rate from time to time in effect as provided in subparagraph (B) of this paragraph (ii).
(1) Dividends on the shares of Auction Preferred Stock shall
accumulate from the Date of Original Issue. Dividends in respect of a
Short-Term Dividend Period shall be payable commencing on the initial
Dividend Payment Date and thereafter, except as provided in clause (2)
below, on each seventh Thursday following the preceding Dividend Payment
Date. Dividends in respect of a Seven-Day Dividend Period, occurring in
connection with an Auction (whether or not held) pursuant to clause (9)
below, shall be payable, except as provided below in clause (2), on the
seventh day following the Business Day next succeeding the day on which
such Auction occurs (or was to have occurred). Dividends in respect of a
Long-Term Dividend Period shall be payable, except as provided in clause
(3) below, on the day following the last day of such Long-Term Dividend
Period and, if occurring prior thereto, on the first day of the fourth
month after the commencement of such Long-Term Dividend Period and
quarterly thereafter on the first day of each succeeding third month. Each
day on which dividends on shares of Auction Preferred Stock would be
payable as determined as set forth in this clause (1) but for adjustments
set forth below in this paragraph (ii)(A) is referred to herein as a
"Normal Dividend Payment Date".
(2) In the case of dividends payable in respect of a Short-Term Dividend Period or a Seven-Day Dividend Period, if:
(I)(x) the Securities Depository shall continue to make available to its members and participants the amounts due as dividends on shares of Auction Preferred Stock in next-day funds on the dates on which such dividends are payable and (y) a Normal Dividend Payment Date is not a Business Day, or the day next succeeding such Normal Dividend Payment Date is not a Business Day, then dividends shall be payable on the first Business Day preceding such Normal Dividend Payment Date that is next succeeded by a Business Day; or
(II)(x) the Securities Depository shall make available to its members and participants the amounts due as dividends on shares of Auction Preferred Stock in immediately available funds on the dates on which such dividends are payable (and the Securities Depository shall have so advised the Trust Company) and (y) a Normal Dividend Payment Date is not a Business Day, then dividends shall be payable on the first
Business Day following such Normal Dividend Payment Date.
(3) In the case of dividends payable in respect of a Long-Term Dividend Period, if:
(I)(x) the Securities Depository shall continue to make available to its members and participants the amounts due as dividends on shares of Auction Preferred Stock in next-day funds on the dates on which such dividends are payable and (y) a Normal Dividend Payment Date is not a Business Day, or the day next succeeding such Normal Dividend Payment Date is not a Business Day, then dividends shall be payable on the first Business Day following such Normal Dividend Payment Date that is next succeeded by a Business Day; or
(II)(x) the Securities Depository shall make available to its members and participants the amounts due as dividends on shares of Auction Preferred Stock in immediately available funds on the dates on which such dividends are payable (and the Securities Depository shall have so advised the Trust Company) and (y) a Normal Dividend Payment Date is not a Business Day, then dividends shall be payable on the first Business Day following such Normal Dividend Payment Date.
(4) Notwithstanding clauses (1), (2) and (3) above, if the date on which dividends on shares of Auction Preferred Stock would be payable as determined as set forth in clause (1), (2) or (3) above is a day that would result in the number of days between successive Auction Dates (determined by excluding the first Auction Date and including the second Auction Date) not being at least equal to the then current minimum holding period (currently set forth in Section 246(c) of the Code) (the "Minimum Holding Period") required for taxpayers to be entitled to the Dividends-Received Deduction on preferred stock ("Dividends-Received Deduction"), then, except in the case of a Seven-Day Dividend Period, dividends on such shares shall be payable, if subclause (I) of either of clause (2) or (3) would be applicable, on the first Business Day following such date on which dividends would be so payable that is next succeeded by a Business Day or, if subclause (II) of either of clause (2) or (3) would be applicable, on the first Business Day following such day on which dividends would be so payable, that in either case results in the number of days between such successive Auction Dates (determined as set forth in this clause (4)) being at least equal to the then current Minimum Holding Period.
(5) Notwithstanding clauses (1), (2), (3) and (4) above, in the event of a change in law altering the Minimum Holding
Period, the Board of Directors of the Corporation may adjust the period of time between Dividend Payment Dates so as to adjust uniformly the number of days (such number of days without giving effect to the adjustments referred to in clauses (2) and (3), being herein referred to as "Dividend Period Days") in Dividend Periods commencing after the date of such change in law to equal or exceed the then current Minimum Holding Period, provided that the number of Dividend Period Days shall not exceed by more than nine days the length of such then current Minimum Holding Period and shall be evenly divisible by seven, and the maximum number of Dividend Period Days, as adjusted pursuant to this clause (5), in no event shall exceed 98 days. This clause (5) shall not apply to a Seven-Day Dividend Period except to the extent that the Minimum Holding Period, as altered, exceeds the aggregate number of Dividend Period Days in such Seven-Day Dividend Period and the next preceding Dividend Period. Upon any such change in the number of Dividend Period Days as a result of a change in law, the Corporation will give notice through the Trust Company of such change to all Existing Holders of Auction Preferred Stock.
(6) Each date on which dividends on Auction Preferred Stock shall be payable as determined as set forth above shall be referred to herein as a "Dividend Payment Date". If applicable, the period from the preceding Dividend Payment Date to the next Dividend Payment Date during a Long-Term Dividend Period is herein referred to as a "Dividend Quarter". Although any particular Dividend Payment Date may not occur on the originally scheduled Normal Dividend Payment Date because of the foregoing adjustments, each succeeding Dividend Payment Date shall be, subject to such adjustments, the date determined as set forth in clause (1) above as if each preceding Dividend Payment Date had occurred on the respective originally scheduled Normal Dividend Payment Date.
(7) The initial Dividend Payment Date for the Auction Preferred Stock
shall be January 9, 1992 (the "initial Dividend Payment Date") and the
initial Dividend Period shall have a number of Dividend Period Days equal
to the number of days from (and including) the Date of Original Issue to
(but excluding) the initial Dividend Payment Date (the "initial Dividend
Period"). After the initial Dividend Period, each subsequent Dividend
Period shall (except for the adjustments described in clauses (2), (3) and
(4) above) be 49 days (each such 49-day period, subject to any adjustment
as a result of a change in law lengthening the Minimum Holding Period as
described in clause (5) above, being herein referred to as a "Short-Term
Dividend Period"), unless as described in clause (8) below, the Corporation
exercises its right to specify that any such subsequent Dividend Period
will be a Long-Term Dividend Period and unless, as provided in clause (9)
below, any Dividend Period shall be a Seven-Day Dividend Period (each such
Short-Term
Dividend Period, Long-Term Dividend Period and Seven-Day Dividend Period, together with the initial Dividend Period, being referred to herein as a "Dividend Period"). After the initial Dividend Period, each successive Dividend Period shall commence on the Dividend Payment Date following the preceding Dividend Period and shall end (I) in the case of a Short-Term Dividend Period or a Seven-Day Dividend Period, on and include the day preceding the next Dividend Payment Date and (II) in the case of a Long-Term Dividend Period, on the last day of the Long-Term Dividend Period specified by the Corporation in the related Notice of Long-Term Dividend Period.
(8) On or prior to the tenth day but not more than 45 days prior to an Auction Date, the Corporation may, at its sole option, by telephonic and written notice (a "Notice of Long-Term Dividend Period") to the Trust Company and the Securities Depository, designate any Dividend Period as a Long-Term Dividend Period. Any Notice of Long-Term Dividend Period may be revoked by the Corporation in its sole discretion on or prior to the third Business Day prior to the related Auction Date by telephonic and written notice (a "Notice of Revocation") to the Trust Company and the Securities Depository. If the Corporation does not give a Notice of Long-Term Dividend Period with respect to the next succeeding Dividend Period, or gives a Notice of Revocation with respect thereto, such next succeeding Dividend Period (subject to the exception stated in clause (9)(II) below) shall be a Short-Term Dividend Period.
(9) In the event that (I) the Corporation has given a Notice of Long-Term Dividend Period with respect to the next succeeding Dividend Period, but Sufficient Clearing Bids are not made in the related Auction, such next succeeding Dividend Period will, notwithstanding such Notice of Long-Term Dividend Period, commence on the Dividend Payment Date next succeeding the relevant Auction Date and end on the day preceding the next succeeding Dividend Payment Date, which, subject to adjustment as provided above, will be the seventh day thereafter (such seven day Dividend Period being herein referred to as a "Seven-Day Dividend Period") and (II) an Auction is not held on an Auction Date for any reason other than the discontinuation of Auctions due to the failure of the Corporation to pay the full amount of any dividends to be paid on any Dividend Payment Date or the full redemption price for any share of Auction Preferred Stock called for redemption on any redemption date, and any such failure shall not have been cured within three Business Days thereafter, the next succeeding Dividend Period shall be a Seven-Day Dividend Period. The Dividend Period next succeeding a Seven-Day Dividend Period shall be a Short-Term Dividend Period unless an Auction is not held on the Auction Date included within such Seven-Day Dividend Period for the reasons specified in clause (9)(II) above, in which case the next succeeding Dividend Period shall be a Seven-Day Dividend Period.
(10) Dividends on the Auction Preferred Stock, if any and to the extent declared, shall be paid on each Dividend Payment Date in funds legally available on such date. The Corporation shall by the close of business on the Business Day prior to each Dividend Payment Date deposit with the Trust Company funds sufficient to pay dividends then payable on such Dividend Payment Date with irrevocable instructions to the Trust Company to make such payment to the holder or holders of record.
(11) Each dividend shall be payable to the holder or holders of record of the Auction Preferred Stock as of the close of business on the Business Day immediately preceding the applicable Dividend Payment Date. So long as the shares of Auction Preferred Stock are held of record by the nominee of the Securities Depository, dividends will be paid to the nominee of the Securities Depository on each Dividend Payment Date.
(B) The dividend rate on the Auction Preferred Stock may not under any
circumstances exceed 16% per annum. The dividend rate on the Auction Preferred
Stock (1) for the initial Dividend Period shall be 4.60% per annum and (2) for
each subsequent Dividend Period shall be the Applicable Rate for such Dividend
Period. The "Applicable Rate" for each such Dividend Period shall be the rate
per annum determined pursuant to Part II below. Notwithstanding the foregoing,
(I) the Applicable Rate on the Auction Preferred Stock during any Seven-Day
Dividend Period shall be (x) if such Seven-Day Dividend Period occurs pursuant
to paragraph (ii)(A)(9)(I) above, the greatest of (aa) the Maximum Applicable
Rate on the Auction Date for a Short-Term Dividend Period, (bb) the Maximum
Applicable Rate on the Auction Date for a Long-Term Dividend Period having a
term equal to the term specified in the Notice of Long-Term Dividend Period
given in respect of such Auction Date and (cc) the Applicable Rate in effect for
the Dividend Period during which such Auction Date occurred, and (y) if such
Seven-Day Dividend Period occurs pursuant to paragraph (ii)(A)(9)(II) above, the
Maximum Applicable Rate for a Short-Term Dividend Period determined as of the
Auction Date next preceding such Seven-Day Dividend Period; and (II) in the
event and during the continuance of any failure of the Corporation to pay the
full amount of any dividends or the full amount of any redemption price, (x)
until such time as the full amount due (including any Late Charge for up to 5
days with respect to each Dividend Payment Date or redemption date with respect
to which such failure occurred, as described in this subparagraph (B) below)
shall have been paid to the Trust Company, Auctions shall be discontinued, (y)
if such dividends or redemption price were to be paid in respect of a Long-Term
Dividend Period, such Long-Term Dividend Period shall cease and a Short-Term
Dividend Period shall be deemed to have commenced on the Dividend Payment Date
or the redemption date, as the case may be, in respect of which such failure
occurred and (z) the
Applicable Rate for each Dividend Period (including without limitation a Short-Term Dividend Period which occurs pursuant to subclause (y) above) commencing on or after any such Dividend Payment Date or redemption date, as the case may be, shall be equal to the Default Rate for such Dividend Period. The foregoing shall continue until there shall occur a Dividend Payment Date at least one Business Day prior to which the full amount of any dividends payable on each Dividend Payment Date, and the full amount of any redemption price then due (including in each case any Late Charge for up to five days with respect to each Dividend Payment Date or redemption date in respect of which such failure occurred, as described in the next succeeding paragraph), shall have been paid to the Trust Company, and thereupon Auctions shall resume on the terms stated herein for the Dividend Periods commencing with such Dividend Payment Date. With respect to any such failure, the "Default Rate" shall be the higher of 250% of the 60-day "AA" Composite Commercial Paper Rate, determined as of the date of such failure, and (I) if the Corporation has failed timely to pay dividends in respect of a Short-Term Dividend Period, a Long-Term Dividend Period or a Seven-Day Dividend Period, the dividend rate in effect for the Short-Term Dividend Period, Long-Term Dividend Period or Seven-Day Dividend Period, as the case may be, in respect of which such failure occurred, or (II) if the Corporation has failed timely to pay the redemption price of shares called for redemption, the dividend rate in effect for the Dividend Period immediately preceding the applicable redemption date.
Any failure referred to in this subparagraph (B) above with respect to the shares of Auction Preferred Stock shall be deemed to be cured if as of 12:00 noon, New York City time, on the third Business Day next succeeding any such failure, the Corporation shall have paid to the Trust Company (1) in the case of a failure to pay dividends, the full amount of the dividends to be paid for the Dividend Period with respect to which such failure occurred, plus a Late Charge in an amount equal to the product of (I) 250% of the 60-day "AA" Composite Commercial Paper Rate on the date of occurrence of such failure, (II) a fraction, the numerator of which shall be the number of days during which such failure exists and is not cured in accordance with this sentence (including the day such failure occurs and excluding the day such failure is cured) (but not to exceed 5 days) and the denominator of which shall be 360, and (III) the full amount of the dividends originally required to be paid for the Dividend Period as to which such failure occurred (a "Late Charge"), or (2) in the case of a failure to pay the redemption price, the full amount of the aggregate redemption price for the shares of Auction Preferred Stock that have been called for redemption, plus accumulated and unpaid dividends from the date of redemption to the date of such cure, plus an amount equal to the product of (I) 250% of the 60-day "AA" Composite Commercial Paper Rate on the Business Day on which the Corporation was required to pay the
aggregate redemption price to the Trust Company, (II) a fraction, the numerator of which shall be the number of days during which such failure exists and is not cured in accordance with this sentence (including the day such failure occurs and excluding the day such failure is cured) (but not to exceed 5 days) and the denominator of which shall be 360, and (III) the aggregate stated value of the shares of Auction Preferred Stock called for redemption. Upon any such cure, Auctions shall be resumed on the Auction Date on or after the date such cure was effected on the terms stated herein for Dividend Periods commencing after such Auction Date.
The amount of dividends per share of the Auction Preferred Stock payable for each Dividend Period (or for each Dividend Quarter during any Long-Term Dividend Period) shall be computed by multiplying the Applicable Rate for each Dividend Period by a fraction, the numerator of which shall be the number of days in the Dividend Period (or Dividend Quarter) (calculated by counting the first day thereof and the last day thereof) such share was outstanding and the denominator of which shall be 360 and multiplying the amount so obtained by $100,000.
(iii) REDEMPTION. Shares of the Auction Preferred Stock shall be redeemable at the option of the Corporation in whole or in part on the last Dividend Payment Date in respect of any Dividend Period at a redemption price of $100,000 per share, plus, in each case, unpaid accumulated dividends, if any, to the date of redemption.
If the Corporation calls shares of the Auction Preferred Stock for redemption, such shares called for redemption will not be included in the Auction that would normally take place on the Business Day preceding the redemption date.
(iv) LIQUIDATION. The amount payable upon shares of the Auction Preferred Stock in the event of voluntary or involuntary liquidation is $100,000 per share (to be referred to as the "Stated Value") plus unpaid accumulated dividends, if any.
In the event of any preferential payments, the Auction Preferred Stock shall be entitled PRO RATA to such preferential payments.
(v) SINKING FUND. There is no sinking fund for the redemption or purchase of shares of the Auction Preferred Stock.
(vi) CONVERSION. Shares of the Auction Preferred Stock are not, by their terms, convertible or exchangeable.
PART II
(a) CERTAIN DEFINITIONS. Capitalized terms not defined in this Part II shall have the respective meanings specified in Part I above. As used in this Part II, the following terms shall have the following meanings, unless the context otherwise requires:
(i) "AFFILIATE" shall mean any Person known to the Trust Company to be controlled by, in control of or under common control with the Corporation.
(ii) "AGENT MEMBER" shall mean the member of or participant in the Securities Depository that will act on behalf of a Bidder and is identified as such in such Bidder's Master Purchaser's Letter.
(iii) "AUCTION" shall mean the periodic implementation of the procedures set forth in this Part II.
(iv) "AUCTION DATE" shall mean the Business Day next preceding the first day of each Dividend Period after the initial Dividend Period.
(v) "AUCTION PREFERRED" shall mean shares of Flexible Auction Series A, Serial Preferred Stock of the Corporation subject to an Auction on any Auction Date.
(vi) "AVAILABLE AUCTION PREFERRED" shall have the meaning specified in section (d)(i) below.
(vii) "BID" shall have the meaning specified in section (b)(i) below.
(viii) "BIDDER" shall have the meaning specified in section (b)(i) below.
(ix) "BID EXCESS" shall have the meaning specified in section
(c)(iv)(B)(1) below.
(x) "BROKER-DEALER" shall mean any broker-dealer or other entity permitted by law to perform the functions required of a Broker-Dealer in this Part II that has been selected by the Corporation to perform such functions and has entered into a Broker-Dealer Agreement with the Trust Company that remains effective.
(xi) "BROKER-DEALER AGREEMENT" shall mean an agreement between the Trust Company and a Broker-Dealer pursuant to which such Broker-Dealer agrees to follow the procedures specified in this Part II.
(xii) "EXISTING HOLDER" when used with respect to shares of Auction Preferred shall mean a Person who has signed a Master Purchaser's Letter and is listed as the beneficial owner of such shares of Auction Preferred in the records of the Trust Company.
(xiii) "HOLD ORDER" shall have the meaning specified in section
(b)(i) below.
(xiv) "MASTER PURCHASER'S LETTER" shall mean a letter addressed to the Corporation, the Trust Company, a Broker-Dealer and others in which a Person agrees, among other things, to offer to purchase, purchase, offer to sell and/or sell shares of Auction Preferred as set forth in this Part II.
(xv) "ORDER" shall have the meaning specified in section (b)(i) below.
(xvi) "OUTSTANDING" shall, for purposes of this Part II, mean, as of any date, shares of Auction Preferred theretofore issued by the Corporation except, without duplication, (A) any shares of Auction Preferred theretofore cancelled or delivered to the Trust Company for cancellation, or redeemed by the Corporation, (B) any shares of Auction Preferred as to which the Corporation or any Affiliate thereof (other than an Affiliate which is a Broker-Dealer) shall be an Existing Holder and (C) any shares of Auction Preferred represented by any certificate in lieu of which a new certificate has been executed and delivered by the Corporation.
(xvii) "PERSON" shall mean and include an individual, a partnership, a corporation, a trust, an unincorporated association, a joint venture or other entity or a government or any agency or political subdivision thereof.
(xviii) "POTENTIAL HOLDER" shall mean any Person, including any Existing Holder, (A) who shall have executed a Master Purchaser's Letter and (B) who may be interested in acquiring shares of Auction Preferred (or, in the case of an Existing Holder, additional shares of Auction Preferred).
(xix) "SECURITIES DEPOSITORY" shall mean The Depository Trust Company and its successors and assigns, or any other securities depository selected by the Corporation which agrees to follow the procedures required to be followed by such securities depository in connection with shares of Auction Preferred.
(xx) "SELL EXCESS" shall have the meaning specified in section
(c)(iv)(C)(i) below.
(xxi) "SELL ORDER" shall have the meaning specified in section (b)(i) below.
(xxii) "SUBMISSION DEADLINE" shall mean 1:00 p.m., New York City time, on any Auction Date or such other time on any Auction Date by which Broker-Dealers are required to submit Orders to the Trust Company as specified by the Trust Company from time to time.
(xxiii) "SUBMITTED BID" shall have the meaning specified in section
(d)(i) below.
(xxiv) "SUBMITTED HOLD ORDER" shall have the meaning specified in section (d)(i) below.
(xxv) "SUBMITTED ORDER" shall have the meaning specified in section
(d)(i) below.
(xxvi) "SUBMITTED SELL ORDER" shall have the meaning specified in section (d)(i) below.
(xxvii) "SUFFICIENT CLEARING BIDS" shall have the meaning specified in section (d)(i) below.
(xxviii) "WINNING BID RATE" shall have the meaning specified in section (d)(i) below.
(b) ORDERS BY EXISTING HOLDERS AND POTENTIAL HOLDERS.
(i) Prior to the Submission Deadline on each Auction Date:
(A) each Existing Holder may submit to a Broker-Dealer information as to:
(1) the number of Outstanding shares, if any, of Auction Preferred held by such Existing Holder which such Existing Holder desires to continue to hold without regard to the Applicable Rate for the next succeeding Dividend Period;
(2) the number of Outstanding shares, if any, of Auction Preferred that such Existing Holder desires to sell, provided that the Applicable Rate for the next succeeding Dividend Period shall be less than the rate per annum specified by such Existing Holder; and/or
(3) the number of Outstanding shares, if any, of Auction Preferred held by such Existing Holder which such Existing Holder offers to sell without regard to the Applicable Rate for the next succeeding Dividend Period; and
(B) each Broker-Dealer, using a list of Potential Holders that shall be maintained by such Broker-Dealer in good faith for the purpose of conducting a competitive Auction, shall contact Potential Holders, including Persons that are not Existing Holders, on such list to determine the number of shares, if any, of Auction Preferred that each such Potential Holder offers to purchase, provided that the Applicable Rate for the next succeeding Dividend Period shall not be less than the rate per annum specified by such Potential Holder.
For the purposes hereof, the communication to a Broker-Dealer of the
information referred to in this section (b)(i) is hereinafter referred to as an
"ORDER" and each Existing Holder and each Potential Holder placing an Order is
hereinafter referred to as a "BIDDER"; an Order containing the information
referred to in clause (A)(1) of this section (b)(i) is hereinafter referred to
as a "HOLD ORDER"; an Order containing the information referred to in clause
(A)(2) or (B) of this section (b)(i) is hereinafter referred to as a "BID"; and
an Order containing the information referred to in clause (A)(3) of this section
(b)(i) is hereinafter referred to as a "SELL ORDER".
(ii) (A) A Bid by an Existing Holder shall constitute an irrevocable offer to sell:
(1) the number of Outstanding shares of Auction Preferred specified in such Bid if the Applicable Rate determined on such Auction Date shall be less than the rate per annum specified in such Bid;
(2) the number of Outstanding shares of Auction Preferred
specified in such Bid or a lesser number of Outstanding shares of
Auction Preferred to be determined as set forth in section
(e)(i)(D) if the Applicable Rate determined on such Auction Date
shall be equal to the rate per annum specified in such Bid; or
(3) the number of Outstanding shares of Auction Preferred specified in such Bid or a lesser number of Outstanding shares of Auction Preferred to be
determined as set forth in section (e)(ii)(C) if the rate per annum specified in such Bid shall be higher than the Maximum Applicable Rate and Sufficient Clearing Bids do not exist.
(B) A Sell Order by an Existing Holder shall constitute an irrevocable offer to sell:
(1) the number of Outstanding shares of Auction Preferred specified in such Sell Order; or
(2) the number of Outstanding shares of Auction Preferred specified in such Sell Order or a lesser number of Outstanding shares of Auction Preferred to be determined as set forth in section (e)(ii)(C) if Sufficient Clearing Bids do not exist.
(C) A Bid by a Potential Holder shall constitute an irrevocable offer to purchase:
(1) the number of Outstanding shares of Auction Preferred specified in such Bid if the Applicable Rate determined on such Auction Date shall be higher than the rate per annum specified in such Bid; or
(2) the number of Outstanding shares of Auction Preferred
specified in such Bid or a lesser number of Outstanding shares of
Auction Preferred to be determined as set forth in section
(e)(i)(E) if the Applicable Rate determined on such Auction Date
shall be equal to the rate per annum specified in such Bid.
(iii) On each Auction Date, the Trust Company will determine the 60-day "AA" Composite Commercial Paper Rate or the Reference Rate, as the case may be, and the Maximum Applicable Rate and will notify each Broker-Dealer of each such rate not later than 9:30 a.m., New York City time on such Auction Date (or such other time on such Auction Date as specified by the Trust Company).
(c) SUBMISSION OF ORDERS BY BROKER-DEALERS TO TRUST COMPANY.
(i) Each Broker-Dealer shall submit in writing to the Trust Company prior to the Submission Deadline on each Auction Date all Orders obtained by such Broker-Dealer and shall specify with respect to each Order:
(A) the name of the Bidder placing such Order;
(B) the aggregate number of shares of Auction Preferred that are the subject of such Order;
(C) to the extent that such Bidder is an Existing Holder:
(1) the number of shares, if any, of Auction Preferred subject to any Hold Order placed by such Existing Holder;
(2) the number of shares, if any, of Auction Preferred subject to any Bid placed by such Existing Holder and the rate specified in such Bid; and
(3) the number of shares, if any, of Auction Preferred subject to any Sell Order placed by such Existing Holder; and
(D) to the extent that such Bidder is a Potential Holder, the rate and the number of shares of Auction Preferred specified in such Potential Holder's Bid.
(ii) If any rate specified in any Bid contains more than three figures to the right of the decimal point, the Trust Company shall round such rate up to the next higher one-thousandth (.001) of 1%.
(iii) If an Order or Orders covering all of the Outstanding shares of Auction Preferred held by an Existing Holder is not submitted to the Trust Company prior to the Submission Deadline, the Trust Company shall deem a Hold Order to have been submitted on behalf of such Existing Holder covering the number of Outstanding shares of Auction Preferred held by such Existing Holder and not subject to Orders submitted to the Trust Company.
(iv) If one or more Orders covering in the aggregate more than the number of Outstanding shares of Auction Preferred held by an Existing Holder are submitted to the Trust Company, such Orders shall be considered valid as follows and in the following order of priority:
(A) any Hold Order submitted on behalf of such Existing Holder shall be considered valid up to and including the number of Outstanding shares of Auction Preferred held by such Existing Holder; provided that if more than one Hold Order is submitted on behalf of such Existing Holder and the number of shares of Auction Preferred subject to such Hold Orders exceeds the number of Outstanding shares of Auction Preferred held by such Existing Holder, the number of shares of Auction Preferred subject to such Hold Orders shall be reduced PRO RATA so that such Hold Orders shall cover the number of Outstanding shares of Auction Preferred held by such Existing Holder.
(B) (1) any Bid shall be considered valid up to and including the excess (the "Bid Excess") of the number of Outstanding shares of Auction Preferred held by such Existing Holder over the number of shares of Auction Preferred subject to Hold Orders referred to in section (c)(iv)(A); and
(2) subject to clause (1) above, if more than one Bid with the same rate is submitted on behalf of such Existing Holder and the number of Outstanding shares of Auction Preferred subject to such Bids is greater than the Bid Excess, the number of shares of Auction Preferred subject to such Bids shall be reduced PRO RATA so that such Bids shall cover the number of shares of Auction Preferred equal to the Bid Excess; and
(3) subject to clause (1) above, if more than one Bid with different rates is submitted on behalf of such Existing Holder, such Bids shall be considered valid in the ascending order of their respective rates up to and including the Bid Excess, and in any such event the number, if any, of such Outstanding shares subject to Bids not valid under this clause (B) shall be treated as the subject of a Bid by a Potential Holder; and
(C) (1) any Sell Order shall be considered valid up to and including the excess (the "Sell Excess") of the number of Outstanding shares of Auction Preferred held by such Existing Holder over the number of shares of Auction Preferred subject to Hold Orders referred to in section (c)(iv)(A) and Bids referred to in section (c)(iv)(B); and
(2) subject to clause (1) above, if more than one Sell Order is submitted on behalf of such Existing Holder and the number of Outstanding shares of Auction Preferred subject to such Sell Orders is greater than the Sell Excess, the number of shares of Auction Preferred subject to such Sell Orders shall be reduced PRO RATA so that such Sell Orders shall cover the number of shares of Auction Preferred equal to the Sell Excess.
(v) If more than one Bid is submitted on behalf of any Potential Holder, each Bid submitted shall be a separate Bid with the rate and number of shares of Auction Preferred therein specified.
(d) DETERMINATION OF SUFFICIENT CLEARING BIDS, WINNING BID RATE AND APPLICABLE RATE.
(i) Not earlier than the Submission Deadline on each Auction Date, the Trust Company shall assemble all Orders submitted or deemed submitted to it by the Broker-Dealers (each such Order as submitted or deemed submitted by a Broker-Dealer being hereinafter referred to individually as a "SUBMITTED HOLD ORDER", a "SUBMITTED BID" or a "SUBMITTED SELL ORDER", as the case may be, or as a "SUBMITTED ORDER") and shall determine:
(A) the excess of the total number of Outstanding shares of Auction Preferred over the number of Outstanding shares of Auction Preferred that are the subject of Submitted Hold Orders (such excess being hereinafter referred to as the "Available Auction Preferred");
(B) from the Submitted Orders whether the number of Outstanding shares of Auction Preferred that are the subject of Submitted Bids by Potential Holders specifying one or more rates equal to or lower than the Maximum Applicable Rate exceeds or is equal to the sum of:
(x) the number of Outstanding shares of Auction Preferred that are the subject of Submitted Bids by Existing Holders specifying one or more rates higher than the Maximum Applicable Rate; and
(y) the number of Outstanding shares of Auction Preferred that are subject to Submitted Sell Orders
(if such excess or such equality exists (other than because the number of shares of Auction Preferred in clauses (x) and (y) is each zero because all of the Outstanding shares of Auction Preferred are the subject of Submitted Hold Orders), such Submitted Bids by Potential Holders being hereinafter referred to collectively as "Sufficient Clearing Bids"); and
(C) if Sufficient Clearing Bids exist, the lowest rate specified in the Submitted Bids (the "WINNING BID RATE") which if:
(1) each Submitted Bid from Existing Holders specifying the Winning Bid Rate and all other Submitted Bids from Existing Holders specifying lower rates were rejected, thus entitling such Existing Holders to continue to hold such shares of Auction Preferred that are the subject of such Submitted Bids; and
(2) each Submitted Bid from Potential Holders specifying the Winning Bid Rate and all other Submitted Bids from Potential Holders specifying lower rates were accepted, thus requiring the Potential Holders to purchase the shares of Auction Preferred that are the subject of such Submitted Bids,
would result in such Existing Holders continuing to hold an aggregate number of Outstanding shares of Auction Preferred that, when added to the number of Outstanding shares of Auction Preferred to be purchased by such Potential Holders, would equal not less than the Available Auction Preferred.
(ii) Promptly after the Trust Company has made the determinations pursuant to section (d)(i), the Trust Company shall advise the Corporation of the Maximum Applicable Rate and, based on such determinations, the Applicable Rate for the next succeeding Dividend Period as follows:
(A) if Sufficient Clearing Bids exist, that the Applicable Rate for the next succeeding Dividend Period shall be equal to the Winning Bid Rate so determined;
(B) if Sufficient Clearing Bids do not exist (other than because
all of the Outstanding shares of Auction Preferred are the subject of
Submitted Hold Orders), then (a) if the Corporation has not given a
Notice of Long-Term Dividend Period with respect to the next
succeeding Dividend Period or has given Notice of Revocation with
respect thereto, then the Applicable Rate for such next succeeding
Dividend Period will be the Maximum Applicable Rate on the Auction
Date for a Short-Term Dividend Period and (b) if the Corporation has
given a Notice of Long-Term Dividend Period with respect to the next
succeeding Dividend Period and has not given a Notice of Revocation
with respect thereto, then such next succeeding Dividend Period will,
notwithstanding such Notice of Long-Term Dividend Period, be a
Seven-Day Dividend Period, and the Applicable Rate for such next
succeeding Dividend Period will be the greatest of (1) the Maximum
Applicable Rate on the Auction Date for a Short-Term Dividend Period,
(2) the Maximum Applicable Rate on the Auction Date for a Long-Term
Dividend Period having a number of Dividend Period Days equal to the
number of Dividend Period Days specified in such Notice of Long-Term
Dividend Period, and (3) the dividend rate in effect for the Dividend
Period during which such Auction occurred; or
(C) if all of the Outstanding shares of Auction Preferred are the subject of Submitted Hold Orders, then the Applicable Rate for the next succeeding Dividend Period shall (1) in the case of a Short-Term Dividend Period, be equal to 59% of the 60-day "AA" Composite Commercial Paper Rate in effect on such Auction Date; and (2) in the case of a Long-Term Dividend Period, 59% of the Reference Rate in effect on such Auction Date.
(e) ACCEPTANCE AND REJECTION OF SUBMITTED BIDS AND SUBMITTED SELL ORDERS AND ALLOCATION OF SHARES. Existing Holders shall continue to hold shares of Auction Preferred that are the subject of Submitted Hold Orders and, based on the determinations made pursuant to section (d)(i), the Submitted Bids and Submitted Sell Orders shall be accepted or rejected and the Trust Company shall take such other action as set forth below:
(i) If Sufficient Clearing Bids have been made, subject to the provisions of section (e)(iii), Submitted Bids and Submitted Sell Orders shall be accepted or rejected in the following order of priority and all other Submitted Bids shall be rejected:
(A) the Submitted Sell Orders of Existing Holders shall be accepted and the Submitted Bid of each of the Existing Holders specifying any rate that is higher than the Winning Bid Rate shall be accepted, thus requiring each such Existing Holder to sell the shares of Auction Preferred that are the subject of such Submitted Bid;
(B) the Submitted Bid of each of the Existing Holders specifying any rate that is lower than the Winning Bid Rate shall be rejected, thus entitling each such Existing Holder to continue to hold the shares of Auction Preferred that are the subject of such Submitted Bid;
(C) the Submitted Bid of each of the Potential Holders specifying any rate that is lower than the Winning Bid Rate shall be accepted;
(D) the Submitted Bid of each of the Existing Holders specifying a rate that is equal to the Winning Bid Rate shall be rejected, thus entitling each such Existing Holder to continue to hold the shares of Auction Preferred that are the subject of such Submitted Bid, unless the number of Outstanding shares of Auction Preferred subject to all such Submitted Bids shall be greater than the number of shares of Auction Preferred ("remaining shares") equal to the excess of
the Available Auction Preferred over the number of shares of Auction Preferred subject to Submitted Bids described in sections (e)(i)(B) and (e)(i)(C), in which event the Submitted Bids of each such Existing Holder shall be accepted, and each such Existing Holder shall be required to sell shares of Auction Preferred, but only in an amount equal to the difference between (1) the number of Outstanding shares of Auction Preferred then held by such Existing Holder subject to such submitted Bid and (2) the number of shares of Auction Preferred obtained by multiplying (x) the number of remaining shares by (y) a fraction, the numerator of which shall be the number of Outstanding shares of Auction Preferred held by such Existing Holder subject to such Submitted Bid and the denominator of which shall be the sum of the number of Outstanding shares of Auction Preferred subject to such Submitted Bids made by all such Existing Holders that specified a rate equal to the Winning Bid Rate; and
(E) the Submitted Bid of each of the Potential Holders
specifying a rate that is equal to the Winning Bid Rate shall be
accepted, but only in an amount equal to the number of shares of
Auction Preferred obtained by multiplying the difference between the
Available Auction Preferred and the number of shares of Auction
Preferred subject to Submitted Bids described in sections (e)(i)(B),
(e)(i)(C) and (e)(i)(D) by a fraction, the numerator of which shall be
the number of Outstanding shares of Auction Preferred subject to such
Submitted Bid and the denominator of which shall be the sum of the
number of Outstanding shares of Auction Preferred subject to such
Submitted Bids made by all such Potential Holders that specified rates
equal to the Winning Bid Rate.
(ii) If Sufficient Clearing Bids have not been made (other than
because all of the Outstanding shares of Auction Preferred are subject to
Submitted Hold Orders), subject to the provisions of sections (e)(iii) and
(e)(iv), Submitted Orders shall be accepted or rejected as follows in the
following order of priority and all other Submitted Bids shall be rejected:
(A) the Submitted Bid of each Existing Holder specifying any rate that is equal to or lower than the Maximum Applicable Rate shall be rejected, thus entitling such Existing Holder to continue to hold the shares of Auction Preferred that are the subject of such Submitted Bid;
(B) the Submitted Bid of each Potential Holder specifying any rate that is equal to or lower than the Maximum Applicable Rate shall be accepted, thus requiring such Potential Holder to purchase the shares of Auction Preferred that are the subject of such Submitted Bid; and
(C) the Submitted Bids of each Existing Holder specifying any rate that is higher than the Maximum Applicable Rate shall be accepted and the Submitted Sell Orders of each Existing Holder shall be accepted, in both cases only in an amount equal to the difference between (1) the number of Outstanding shares of Auction Preferred then held by such Existing Holder subject to such Submitted Bid or Submitted Sell Order and (2) the number of shares of Auction Preferred obtained by multiplying (x) the difference between the Available Auction Preferred and the aggregate number of shares of Auction Preferred subject to Submitted Bids described in sections (e)(ii)(A) and (e)(ii)(B) by (y) a fraction, the numerator of which shall be the number of Outstanding shares of Auction Preferred held by such Existing Holder subject to such Submitted Bid or Submitted Sell Order and the denominator of which shall be the number of Outstanding shares of Auction Preferred subject to all such Submitted Bids and Submitted Sell Orders.
(iii) If, as a result of the procedures described in section (e)(i) or (e)(ii), any Existing Holder would be entitled or required to sell, or any Potential Holder would be entitled or required to purchase, a fraction of a share of Auction Preferred on any Auction Date, the Trust Company shall, in such manner as, in its sole discretion, it shall determine, round up or down the number of shares of Auction Preferred to be purchased or sold by any Existing Holder or Potential Holder on such Auction Date so that the number of shares purchased or sold by each Existing Holder or Potential Holder on such Auction Date shall be whole shares of Auction Preferred.
(iv) If Sufficient Clearing Bids have not been made (other than because all of the Outstanding shares of Auction Preferred are subject to Submitted Hold Orders) in an Auction relating to a Long-Term Dividend Period, all Submitted Bids and all Submitted Sell Orders shall be rejected, thus requiring each Existing Holder to continue to hold the shares of Auction Preferred held by such Existing Holder immediately prior to such Auction.
(v) If all of the Outstanding shares of Auction Preferred are the subject of Submitted Hold Orders, all Submitted Bids shall be rejected.
(vi) Based on the results of each Auction, the Trust Company shall determine the aggregate number of shares of Auction Preferred to be purchased and the aggregate number of shares of Auction Preferred to be sold by Potential Holders and Existing Holders on whose behalf each Broker-Dealer submitted Bids or Sell Orders, and, with respect to each Broker-Dealer, to the extent that such aggregate number of shares to be purchased and such aggregate number of shares to be sold differ, determine to which other Broker-Dealer or Broker-Dealers acting for one or more purchasers such Broker-Dealer shall deliver, or from which other Broker-Dealer or Broker-Dealers acting for one or more sellers such Broker-Dealer shall receive, as the case may be, shares of Auction Preferred.
(f) MISCELLANEOUS. The Board of Directors may interpret the provisions of this Part II to resolve any inconsistency or ambiguity which may arise or be revealed in connection with the Auction Procedures provided for herein and their interpretation shall be binding. An Existing Holder (A) may sell, transfer or otherwise dispose of shares of Auction Preferred only pursuant to a Bid or Sell Order in accordance with the procedures described in this Part II to or through a Broker-Dealer or to a Person that has delivered a signed copy of a Master Purchaser's Letter to the Trust Company, provided that in the case of all transfers other than pursuant to Auctions such Existing Holder, its Broker-Dealer or its Agent Member advises the Trust Company of such transfer, and (B) shall have the beneficial ownership of the shares of Auction Preferred held by it maintained in book-entry form by the Securities Depository in the account of its Agent Member, which in turn will maintain records of such Existing Holder's beneficial ownership. The Company and its Affiliates shall not submit any Order in any Auction except as set forth in the next sentence. Any Broker-Dealer that is an affiliate of the Company may submit Orders in Auctions but only if such Orders are not for its own account, except that if such affiliated Broker-Dealer holds shares of Auction Preferred for its own account, it must submit a Sell Order in the next Auction with respect to such shares of Auction Preferred.
(g) HEADINGS OF SUBDIVISIONS. The headings of the various subdivisions of this Part II are for convenience of reference only and shall not affect the interpretation of any of the provisions hereof.
Dated: November 5, 1991
IDAHO POWER COMPANY
By: /s/ Larry R. Gunnoe
------------------------------
Larry R. Gunnoe, President
By: /s/ Robert Stahman
------------------------------
Robert Stahman, Secretary
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Exhibit 3(f)
STATEMENT OF RESOLUTION
ESTABLISHING TERMS OF NEW PREFERRED STOCK
FIRST: The name of the corporation is Idaho Power Company (the "Company").
SECOND: The following resolution, establishing and designating a series of
shares and fixing and determining certain of the relative rights and
preferences thereof, was duly adopted by the Board of Directors of the
Company on June 24, 1993.
RESOLVED, That, pursuant to Section 30-1-16 of the Idaho Business
|
Corporation Act and to the power vested in the Board of Directors by Article
6.C.3 of the Restated Articles of Incorporation, as amended, of the Company, the
fourth series of the Company's Serial Preferred Stock, Without Par Value, is
hereby created, and the Restated Articles of Incorporation, as amended, of the
Company are further amended by the addition to the provisions of Article 6.C.3
of such Restated Articles of Incorporation, as amended, of the following
paragraph (f) immediately before the heading "4. Common Stock":
(f) THE 7.07% SERIES, SERIAL PREFERRED STOCK, WITHOUT PAR VALUE. There is hereby created the fourth series of the Company's Serial Preferred Stock, Without Par Value, which shall be designated as the 7.07% Series, Serial Preferred Stock, Without Par Value, which consists of 250,000 shares. The rights and preferences of the shares of said series, in those respects in which the shares thereof may vary from shares of other series, shall be as follows:
(i) DIVIDENDS. The rate per annum of dividends on shares of the 7.07% Series, Serial Preferred Stock, Without Par Value, shall be 7.07% of the amount payable per share in the event of voluntary liquidation excluding any accumulated dividends.
Dividends shall be cumulative from the date of original issuance of the shares. The initial dividend if declared will be payable on August 20, 1993, for the period commencing with and including the date of original issuance of the shares through and including August 19, 1993. Thereafter, dividends if declared shall be payable on the 20th day of February, May, August and November of each year or otherwise as the Board of Directors may determine.
(ii) REDEMPTION. Shares of the 7.07% Series, Serial Preferred Stock, Without Par Value, shall not be redeemable prior to July 1, 2003, but shall be redeemable at the option of the Company, in whole or in part, at any time on or after July 1, 2003, at the per share redemption price of $103.535 through June 30, 2004; $103.182 thereafter through June 30, 2005; $102.828 thereafter
through June 30, 2006; $102.475 thereafter through June 30, 2007; $102.121 thereafter through June 30, 2008; $101.768 thereafter through June 30, 2009; $101.414 thereafter through June 30, 2010; $101.061 thereafter through June 30, 2011; $100.707 thereafter through June 30, 2012; $100.354 thereafter through June 30, 2013; and $100 thereafter; plus, in each case, unpaid accumulated dividends, if any, to the date of redemption.
(iii) LIQUIDATION. The amount payable upon shares of the 7.07% Series, Serial Preferred Stock, Without Par Value, in the event of voluntary or involuntary liquidation is $100 per share (to be referred to as the "Stated Value") plus accumulated dividends, if any.
In the event of any preferential payments, the 7.07% Series, Serial Preferred Stock, Without Par Value, shall be entitled PRO RATA to such preferential payments.
(iv) SINKING FUND. There is no sinking fund for the redemption or purchase of shares of 7.07% Series, Serial Preferred Stock, Without Par Value.
(v) CONVERSION. Shares of the 7.07% Series, Serial Preferred Stock, Without Par Value, are not, by their terms, convertible or exchangeable.
Dated: June 30, 1993
IDAHO POWER COMPANY
By: /s/ Larry R. Gunnoe
-----------------------------
Larry R. Gunnoe, President
By: /s/ Robert Stahman
-----------------------------
Robert Stahman, Secretary
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Exhibit 3(g)
WAIVER RESOLUTION TO RESTATED ARTICLES OF INCORPORATION OF
IDAHO POWER COMPANY ADOPTED BY SHAREHOLDERS ON MAY 1, 1991
RESOLVED, That during the period commencing May 1, 1991, and
terminating December 31, 2000, shares of the 4% Preferred Stock or of any class
of stock having relative rights and preferences equal or superior to the
relative rights and preferences of the 4% Preferred Stock with respect to the
payment of dividends or the distribution of assets in liquidation may be issued
provided that the gross income of the Company for a period of twelve (12)
consecutive calendar months within the fifteen (15) calendar months immediately
preceding such issuance, determined in accordance with generally accepted
accounting practices (but in any event after deduction of all taxes and
depreciation) shall have been at least one and one-half (1-1/2) times the sum of
(i) the annual interest charges on all interest bearing indebtedness of the
Company outstanding in the hands of the public, and (ii) the annual dividend
requirements on all outstanding shares of the 4% Preferred Stock and any other
class of stock of the Company having relative rights and preferences equal or
superior to the aforesaid relative rights and preferences of the 4% Preferred
Stock including the shares proposed to be issued; provided, that there shall be
excluded from the foregoing computation interest charges on all indebtedness and
dividends on all shares of the 4% Preferred Stock or any other class of stock of
the Company having relative rights and preferences equal or superior to the
aforesaid relative rights and preferences of the 4% Preferred Stock which are to
be retired in connection with the issuance of such additional shares; and
provided further, that in any case where such additional shares of the 4%
Preferred Stock or any other class of stock of the Company having relative
rights and preferences equal or superior to the aforesaid relative rights and
preferences of the 4% Preferred Stock are to be issued in connection with the
acquisition of additional public utility property, the gross income of the
property to be so acquired, computed on the same basis as the gross income of
the Company, may be included on a PRO FORMA basis in making the foregoing
computation.
Exhibit 3(h)
Effective June 30, 1989
BY-LAWS
of
IDAHO POWER COMPANY
As Amended
SECTION 1. The annual meeting of the shareholders of the Company for the election of Directors and the transaction of such other corporate business as may properly come before such meeting, shall be held at Boise, Idaho, or at such other place as the Board of Directors may designate, such place to be stated in the notice of meeting, on the first Wednesday in May in each year, unless such day is a legal holiday, in which case such meeting shall be held on the day following.
SECTION 2. Special meetings of the shareholders of the Company may be called only by the Chairman of the Board of Directors, the President, a majority of the Board of Directors, or the holders of not less than four-fifths of the shares entitled to vote at the meeting, at such time, and at Boise, Idaho, or such other place, as may be stated in the call and notice.
SECTION 3. Notice of the time and place of every meeting of shareholders shall be mailed by the Secretary at least ten days previous thereto, to each shareholder of record at his last known post office address, but meetings may be held without notice if all shareholders are present, or if notice is waived before or after the meeting by those not present.
The Board of Directors are hereby authorized to fix a day, not more than fifty days prior to the day of holding any meeting of shareholders, as the day as of which shareholders entitled to notice and to vote at such meetings shall be determined and only shareholders of record at the close of business on such day shall be entitled to notice of or to vote at such meeting.
SECTION 4. The holders of shares of the capital stock entitling them to exercise a majority of the voting power must be present in person or by proxy at each meeting of the shareholders to constitute a quorum, less than a quorum having power to adjourn.
SECTION 5. Certificates of stock shall be of such form and device as the Board of Directors may elect, and shall be signed by the President or a Vice President and by the Secretary or Assistant Secretary, but where any such certificate is manually signed by a transfer agent or by a registrar other than the Company itself or an employee of the Company serving in either of those capacities, the signatures of any such officer or officers and the seal of the Company upon such certificate may be facsimiles, engraved or printed. The stock of the Company shall be transferable or assignable on the books of the Company by the holders in person or by attorney or surrender of the certificates therefor. The Board of Directors may appoint one or more transfer agents and registrars of the stock. The books for the transfer of the stock of the Company may be closed for such periods before and during the payment of dividends, not to exceed thirty days, and the holding of meetings of shareholders, not to exceed forty days, as the Board of Directors may from time to time determine, and no transfer of stock made during such a period shall be binding upon the Company.
SECTION 6A. The number of Directors constituting the Board of Directors of the Company shall be fixed from time to time exclusively by the Board of Directors pursuant to a resolution adopted by affirmative vote of two- thirds of the Continuing Directors (as defined in Article 8 of the Restated Articles of Incorporation), but the number of Directors shall be no less than 9 and no greater than 15. The number of Directors may be increased or decreased, beyond the limits set forth above, only by an amendment to the Restated Articles of Incorporation of the Company pursuant to Article 10 of the Restated Articles of Incorporation of the Company. Six members of the Board of Directors shall constitute a quorum for the transaction of all business except (1) the election of members of the Executive Committee, for which purpose a majority of all of the Directors shall constitute a quorum, and (2) the filling of vacancies in the Board of Directors, which provision is set forth below.
The Board of Directors shall be divided into three classes as nearly equal in number as may be. The initial term of office of each Director in the first class shall expire at the annual meeting of shareholders in 1990; the initial term of office of each Director in the second class shall expire at the annual meeting of shareholders in 1991; and the initial term of office of each Director in the third class shall expire at the annual meeting of shareholders in 1992. At each annual election commencing at the annual meeting of shareholders in 1990, the successors to the class of Directors whose term expires at that time shall be elected to hold office for a term of three years to succeed those whose term expires, so that the term of one class of Directors shall expire each year. Each Director shall hold office for the term for which he is elected or appointed and until his successor shall be elected and qualified or until his death, or until he shall resign or be removed; provided, however, that no person who will be seventy (70) years of age or more on or before the annual meeting shall be nominated to the Board of Directors, and any Directors who reach the age of seventy (70) shall be automatically retired from the Board.
In the event of any increase or decrease in the authorized number of Directors, (i) each Director then serving as such shall nevertheless continue as a Director of the class of which he is a member until the expiration of his current term, or his earlier resignation, removal from office or death, and (ii) the newly created or eliminated directorships resulting from such increase or decrease shall be apportioned by the Board of Directors among the three classes of Directors so as to maintain such classes as nearly equal in number as may be.
Newly created directorships resulting from any increase in the authorized number of Directors or any vacancies in the Board of Directors resulting from death, resignation, retirement, disqualification, removal from office or other cause shall be filled by a two-thirds vote of the Directors then in office, or a sole remaining Director, although less than a quorum, and Directors so chosen shall hold office for a term expiring at the annual meeting of shareholders at which the term of the class to which they have been elected expires. If one or more Directors shall resign from the Board effective as of a future date, such vacancy or vacancies shall be filled pursuant to the provisions hereof, and such new directorship(s) shall become effective when such resignation or resignations shall become effective, and each Director so chosen shall hold office as herein provided in the filling of other vacancies.
At a special meeting of shareholders called expressly for that purpose, the entire Board of Directors or any individual Directors may be removed (i) without cause, by the unanimous vote of the outstanding shares entitled to vote for Directors, and (ii) for cause, by the affirmative vote of two-thirds of the outstanding shares entitled to vote for Directors. Except as may otherwise by provided by law, cause for removal shall be construed to exist only if: (x) the Director whose removal is proposed has been convicted, or granted immunity to testify where another has been convicted, of a felony by a court of competent jurisdiction and such conviction is no longer subject to appeal; (y) such Director has been grossly negligent in the performance of his duties to the Company; or (z) such Director has been adjudicated by a court of competent jurisdiction to be mentally incompetent, which mental incompetency directly affects his ability as a Director of the Company, and such adjudication is no longer subject to appeal.
Any Directors elected pursuant to special voting rights of the 4% Preferred Stock or Serial Preferred Stock, without par value, voting as a separate class, shall be excluded from, and for no purpose be counted in, the scope and operation of the foregoing provisions.
B.(i) OBLIGATION TO INDEMNIFY. The Company shall indemnify any person (and his heirs, executors, administrators or other legal representatives) who was or is party to (or is threatened to be made a party to) or was or is a witness in (or is threatened to be made a witness in) any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (including without limitation any suit, action or proceeding by or in the right of the Company to procure a judgment in its favor) by reason of the fact that he (or his testator or intestate) is or was a Director, officer, employee or agent of the Company, or is or was serving at the request of the Company as a Director, officer, trustee, partner, fiduciary,
employee or agent of another corporation, of any type or kind, domestic or foreign, or any partnership, joint venture, trust, pension or other employee benefit plan or any other entity or enterprise, against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding or any appeal therein; provided, however, that no indemnification shall be made pursuant to this Subsection (i) (a) if a judgment or other final adjudication adverse to such person shall have established that such person did not act honestly or in the reasonable belief that his actions were in or not opposed to the Company's or its shareholders' best interests; or (b) in an action or proceeding by or in the right of the Company to procure a judgment in its favor in which that person is finally adjudicated to be liable to the Company; however, the Company will indemnify that person in the suits described in (b) for such amounts as the court in which the action, suit or proceeding was brought shall determine in view of all the circumstances of the case the person to be fairly and reasonably entitled.
(ii) ADVANCEMENT OF EXPENSES. The Company shall pay any expenses incurred by a Director, officer, agent or employee of the Company in defending any such action, suit or proceeding in advance of the final disposition thereof if a majority vote of a quorum of disinterested Directors or a board-designated independent counsel determines that the person seeking indemnification has not acted dishonestly, or without a reasonable belief that his actions were in or not opposed to the Company's or its shareholders' best interests and upon receipt of (a) an undertaking by or on behalf of such person to repay such advances to the extent of the amount to which such person shall ultimately be determined not to be entitled, and (b) an affirmation that the person has met the standard of conduct set forth above.
(iii) NONEXCLUSIVITY. The rights to indemnification and to the advancement of expenses and any other benefits provided by, or granted pursuant to, Subsections (i) and (ii) of this Section shall not be deemed exclusive of any other rights to which a person seeking indemnification or advancement of expenses may be or hereafter become entitled whether contained in (a) a resolution of the shareholders of the Company, (b) a resolution of the Board of Directors, or (c) an agreement, duly authorized by the Board of Directors, providing for such indemnification; provided, however, that no indemnification contemplated by this Subsection (iii) may be made if such indemnification would be unlawful.
(iv) INSURANCE. The Company may purchase and maintain insurance on behalf of any person who is or was a Director, officer, employee or agent of the Company, or is or was serving at the request of the Company as a Director, officer, trustee, partner, fiduciary, employee or agent of another corporation, partnership, joint venture, trust, pension or other employee benefit plan or any other entity or enterprise against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not the Company would have the power to indemnify him against such liability under this Section 6B.
(v) INSURANCE OFFSET AGAINST INDEMNITY. The Company's indemnity of any person who is or was a Director, officer, agent or employee of the Company, or is or was serving
in any capacity in any other entity or enterprise at the request of the Company, shall be reduced by any amounts such person may collect as indemnification (a) under any policy of insurance purchased and maintained on his behalf by the Company, and (b) from such other entity or enterprise.
(vi) AFFILIATES; MERGERS; ETC. For the purposes of this Section, references to the "Company" shall include any subsidiary or affiliated corporation, any predecessor of the Company and all constituent corporations absorbed in a consolidation or merger as well as the resulting or surviving corporation so that any person who is or was a Director, officer, employee or agent of such a constituent corporation or is or was serving at the request of such constituent corporation as a Director, officer, trustee, partner, fiduciary, employee or agent of another corporation, partnership, joint venture, trust, pension or other employee benefit plan or other entity or enterprise shall stand in the same position under the provisions of this Section 6B with respect to the resulting or surviving corporation as he would if he had served the resulting or surviving corporation in the same capacity.
(vii) CONTRACT RIGHT. All rights to indemnification and to the
advancement of expenses granted under Subsections (i), (ii) and (iii) of this
Section 6B shall be deemed to arise out of a contract between the Company and
the Director, officer, agent or employee of the Company who serves in such
capacity at any time while these By-laws are in effect. No repeal or
modification of these By-laws shall affect any rights or obligations theretofore
existing.
(viii) LIMITATION. Nothing contained in this Section 6B, or elsewhere in these By-laws, shall operate to require the Company to indemnify any person if such indemnification shall be for any reason contrary to applicable law.
C. The provisions of each paragraph or subsection of 6A or 6B of these By-laws shall be separable and if any provision or portion thereof shall for any reason be inapplicable or ineffective, this shall not affect any other provision or portion or the application, validity or effectiveness thereof.
SECTION 7. Meetings of the Board of Directors shall be held at the time fixed by resolution of the Board or upon call of the president or Vice President or Chairman of the Board. The Secretary or officer performing his duties shall give five days' notice of all meetings of Directors, provided that a meeting may be held without notice immediately after the annual election, and notice need not be given of regular meetings held at times fixed by resolution of the Board. Meetings may be held at any time without notice if all the Directors are present, or if those not present waive notice, either before or after the meeting.
SECTION 8. The Board of Directors, as soon as may be after the election in each year, shall appoint one of their number Chairman of the Board, and one of their number President of the Company, and shall also appoint one or more Vice Presidents, a Secretary and a Treasurer,
and shall, from time to time, appoint such other officers as they may deem proper. The same person may be appointed to more than one office.
Vacancies in the office of President may be filled by the Board of Directors at any meeting at which a majority of the Directors shall be present.
SECTION 9. The Board of Directors, as soon as may be after the election in each year, shall appoint an Executive Committee to consist of the Chairman of the Board, the President and such number of Directors as the Board may from time to time determine. Such Committee shall have and may exercise all of the powers of the Board during the intervals between its meetings, which may be lawfully delegated, subject to such limitations as may be provided by resolution of the Board. The Board shall have the power at any time to change the membership of such Committee and to fill vacancies in it. The Executive Committee may make rules for the conduct of its business and may appoint such Committees and assistants as it may deem necessary. The Board may from time to time determine by resolution the number of members of such Committee required to constitute a quorum. The Chairman of the Board shall be the Chairman of the Executive Committee.
During the intervals between the meetings of the Executive Committee, the Chairman of the Board shall possess and may exercise such of the powers vested in the Executive Committee as from time to time may be conferred upon him by resolution of the Board of Directors or the Executive Committee.
SECTION 10. A Director of this Company shall not be disqualified by
his office from dealing or contracting with the Company, either as vendor,
purchaser or otherwise, nor shall any transactions or contract of this Company
be void or voidable by reason of the fact that any Director, or any firm of
which any Director is a member, or any corporation of which any Director is a
shareholder or Director, is in any way interested in such transaction or
contract, PROVIDED that any such transaction or contract is or shall be
authorized, ratified or approved either (1) by vote of a majority of a quorum of
the Board of Directors or of the Executive Committee, without counting in such
majority or quorum any Director so interested, or being a member of a firm so
interested, or a shareholder or a Director of a corporation so interested, or
(2) by vote at a shareholder's meeting of the holders of shares of the capital
stock entitling them to exercise a majority of the voting power, or by a writing
or writings signed by such holders; nor shall any Director be liable to account
to the Company for any profit realized by him from or through any transaction or
contract of this Company, authorized, ratified or approved as aforesaid, by
reason of the fact that he, or any firm of which he is a member, or any
corporation of which he is a shareholder or Director, was interested in such
transaction or contract. Nothing herein contained shall create any liability in
the events above described or prevent the authorization, ratification or
approval of such contracts or transactions in any other manner provided by law.
SECTION 11. The term of office of all officers shall be one year, or until their respective successors are chosen and qualified, but any officer may be removed from office at any time by the Board of Directors.
SECTION 12. The officers of the Company shall have such duties as usually pertain to their offices respectively, as well as such power and duties as may from time to time be conferred by the Board of Directors.
SECTION 13. The shareholders may alter or amend these By-laws (except as set forth in the next sentence) by affirmative vote of the holders of shares of the capital stock entitling them to exercise a majority of the voting power, irrespective of class, at any annual meeting or upon notice at any special meeting. However, Section 2 of these By-laws may be altered, amended, changed or repealed only by the affirmative vote of the holders of at least four-fifths of the voting power of the then outstanding voting stock of the Company, provided that such four-fifths vote shall not be required for any amendment, alteration, change or repeal recommended to the shareholders by two-thirds of the Continuing Directors (as defined in Article 8 of the Company's Restated Articles of Incorporation).
SECTION 14. In the event of emergency conditions following a catastrophe or disaster, the following provisions shall apply, other provisions of these by-laws notwithstanding: In the case of any vacancy or vacancies in the Board of Directors, the remaining Directors, although less than a majority or a quorum, by affirmative majority vote, may elect a successor or successors to hold office until the next annual meeting of the shareholders of the Company and until his or their successors shall be elected and qualified. If only one Director remains, he shall forthwith appoint two additional Directors, and the three shall thereupon fill the remaining vacancies. The Directors so appointed and elected shall fill any vacancies which may exist among the officers of the Company, including the President, a Vice President, Treasurer and Secretary, and shall also fill any vacancies which may exist on the Executive Committee. When deemed necessary during any such emergency conditions, notices may be given and Directors and members of the Executive Committee may vote and act by telephone, mail or other means of direct communication, but meetings shall be held and Directors and the Executive Committee shall vote and act in the regular manner if reasonably practicable. If the event that a quorum of either the Board of Directors or the Executive Committee cannot readily be convened, then all the powers and duties of the Board of Directors shall vest in an Emergency Management Committee which shall consist of all readily available members of the Board of Directors and the officers of the Company who are not Directors, but the Emergency Management Committee shall act only when necessary, at times when the Board of Directors or Executive Committee cannot readily be convened or act as hereinabove set forth; provided, however, that if the Emergency Management Committee shall take action in good faith, such action shall be valid as if taken by the Board of Directors or Executive Committee although it may subsequently develop that at the time such action was taken the conditions requisite for action by the Emergency Management Committee did not in fact exist.
Exhibit 5(a)
IDACORP, Inc.
1221 W. Idaho Street
Boise, Idaho 83702
P.O. Box 70
Boise, Idaho 83707
Robert W. Stahman
Vice President, General
Counsel and Secretary
March 13, 1998
IDACORP, Inc.
1221 West Idaho Street
Boise, Idaho 83702
Ladies and Gentlemen:
I have acted as counsel to IDACORP, Inc., an Idaho corporation (the "Company"), in connection with the proposed formation of a holding company structure for Idaho Power Company, an Idaho corporation ("Idaho Power"), through a statutory share exchange (the "Share Exchange") between Idaho Power and the Company, pursuant to an Agreement and Plan of Exchange (the "Exchange Agreement").
This opinion is being rendered in connection with the filing by the Company of a Registration Statement on Form S-4 (the "Registration Statement") related to the registration under the Securities Act of 1933, as amended (the "Act"), of 38,500,000 shares of common stock, without par value, of the Company (the "Company Common Stock") to be issued in the Share Exchange.
For purposes of this opinion, I have examined originals or copies, certified or otherwise identified to my satisfaction, of (i) the Exchange Agreement; (ii) the Registration Statement; (iii) the Articles of Incorporation and Bylaws of the Company, as in effect on the date hereof and as to be amended immediately prior to consummation of the Share Exchange; (iv) resolutions adopted by the Board of Directors of the Company relating to the Share Exchange and the issuance and delivery of the Company Common Stock in connection therewith; and (v) such other documents, certificates and other records as I have deemed necessary or appropriate.
Based upon the foregoing, and subject to the qualifications hereinafter expressed, I am of the opinion that:
(1) The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Idaho; and
(2) The Company Common Stock will be validly issued, fully paid and non-assessable when (i) the Registration Statement shall have become effective under the Act; (ii) the Company's Board of Directors shall have taken appropriate action to authorize the issuance of the Company Common Stock; (iii) Idaho Power shareholders shall have approved the Share Exchange; (iv) Idaho Power shall have received all necessary regulatory approvals required to consummate the Share Exchange; and (v) the Share Exchange shall have been consummated in accordance with the terms of the Exchange Agreement and the laws of the State of Idaho.
I am a member of the Idaho Bar and do not hold myself out as an expert on the laws of any other state. Except as set forth in paragraph 2(iv) above, my opinions expressed above are limited to the laws of the State of Idaho and the federal laws of the United States.
I hereby consent to the filing of this opinion as Exhibit 5(a) to the Registration Statement and to the references made to me under the caption "LEGAL OPINIONS" in said Registration Statement and the Proxy Statement and Prospectus constituting a part thereof.
Very truly yours,
/s/ Robert W. Stahman Robert W. Stahman |
Exhibit 5(b) and 8
LeBoeuf, Lamb, Greene &
MacRae, L.L.P.
125 W. 55th Street
New York, NY 10019
March 13, 1998
IDACORP, Inc.
1221 West Idaho Street
Boise, Idaho 83702
Ladies and Gentlemen:
We have acted as counsel to IDACORP, Inc., an Idaho corporation (the "Company"), in connection with the proposed formation of a holding company structure for Idaho Power Company, an Idaho corporation ("Idaho Power"), through a statutory share exchange (the "Share Exchange") between Idaho Power and the Company, pursuant to an Agreement and Plan of Exchange (the "Exchange Agreement").
This opinion is being rendered in connection with the filing by the Company of a Registration Statement on Form S-4 (the "Registration Statement") relating to the registration under the Securities Act of 1933, as amended (the "Act"), of 38,500,000 shares of common stock, without par value, of the Company (the "Company Common Stock") to be issued in the Share Exchange.
For purposes of this opinion, we have examined originals or copies, certified or otherwise identified to our satisfaction, of (i) the Exchange Agreement; (ii) the Registration Statement; (iii) the Articles of Incorporation and Bylaws of the Company, as in effect on the date hereof and as to be amended immediately prior to consummation of the Share Exchange; (iv) resolutions adopted by the Board of Directors of the Company relating to the Share Exchange and the issuance and delivery of the Company Common Stock in connection therewith; and (v) such other documents, certificates and other records as we have deemed necessary or appropriate.
Based upon the foregoing, and subject to the qualifications hereinafter expressed, we are of the opinion that:
(1) The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Idaho; and
(2) The Company Common Stock will be validly issued, fully paid and non-assessable when (i) the Registration Statement shall have become effective under the Act; (ii) the Company's Board of Directors shall have taken appropriate action to authorize the
IDACORP, Inc.
March 13, 1998
Page Two
issuance of the Company Common Stock; (iii) Idaho Power shareholders shall have approved the Share Exchange; (iv) Idaho Power shall have received all necessary regulatory approvals required to consummate the Share Exchange; and (v) the Share Exchange shall have been consummated in accordance with the terms of the Exchange Agreement and the laws of the State of Idaho.
We are further of the opinion that the statements contained in the Proxy Statement and Prospectus constituting part of the Registration Statement under the caption "Proposal No. 2 - HOLDING COMPANY PROPOSAL - United States Federal Income Tax Consequences" describing certain Federal income tax consequences to holders of Idaho Power common stock, as qualified therein, constitute an accurate description, in general terms, of the indicated Federal income tax consequences of the Share Exchange.
We express no opinion as to matters of law other than the Federal law of the United States. To the extent the opinions expressed above are dependent upon matters governed by the law of the State of Idaho, we have relied, with your consent, upon the opinion of even date herewith rendered to you by Robert W. Stahman, Esq.
We hereby consent to the filing of this opinion as Exhibit 5(b) and 8 to the Registration Statement and to the references to our firm under the captions "Proposal No. 2 - HOLDING COMPANY PROPOSAL - United States Federal Income Tax Consequences" and "LEGAL OPINIONS" in said Registration Statement and the Proxy Statement and Prospectus constituting a part thereof.
Very truly yours,
/s/ LeBoeuf, Lamb, Greene & MacRae, L.L.P. LeBoeuf, Lamb, Greene & MacRae, L.L.P. |
EXHIBIT 23(C)
INDEPENDENT AUDITORS' CONSENT
IDACORP, Inc.:
We consent to the incorporation by reference in this Registration Statement of IDACORP, Inc. on Form S-4 of our report dated January 30, 1998 appearing in the Annual Report on Form 10-K of Idaho Power Company for the year ended December 31, 1997 and to the reference to us under the heading "Experts" in the Proxy Statement and Prospectus, which is part of this Registration Statement.
Deloitte & Touche LLP
March 13, 1998
Boise, Idaho
Exhibit 99
PROXY
IDAHO POWER COMPANY
ANNUAL MEETING OF SHAREHOLDERS
MAY 6, 1998
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
PROPERLY EXECUTED PROXIES WILL BE VOTED AS MARKED AND, IF NOT MARKED, PROXIES RECEIVED WILL BE VOTED "FOR" PROPOSAL (1), ELECTION OF MANAGEMENT'S NOMINEES FOR DIRECTORS, "FOR" PROPOSAL (2), APPROVAL OF THE HOLDING COMPANY PROPOSAL, AND "FOR" PROPOSAL (3), RATIFICATION OF THE SELECTION OF DELOITTE & TOUCHE LLP AS INDEPENDENT AUDITOR FOR THE FISCAL YEAR 1998.
The undersigned hereby appoints Joseph W. Marshall and Robert W. Stahman, and each of them, proxies with full power of substitution to vote for the undersigned at the Annual Meeting of Shareholders of Idaho Power Company, and at any adjournments thereof, on the matters set forth in the Proxy Statement and such other matters as may come before the meeting; and hereby directs that this proxy be voted in accordance with the instructions herein.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE PROPOSALS REGARDING:
(1) ELECTION OF DIRECTORS: ROBERT D. BOLINDER; JON H. MILLER; GENE C.
ROSE; PHIL SOULEN
FOR WITHHOLD
All nominees listed above / / Authority to vote for / /
(except as marked to the all nominees listed above
contrary to the right)
|
(INSTRUCTIONS: To withhold authority to vote for any individual nominee, write that nominee's name on the line provided below.)
(2) Approval of the formation of a holding company and an Agreement and Plan of Exchange, whereby IDACORP, Inc., an Idaho corporation formed by Idaho Power, will become the parent company of Idaho Power.
FOR / / AGAINST / / ABSTAIN / /
(3) Ratification of the selection of Deloitte & Touche LLP as Independent Auditor for the fiscal year ending December 31, 1998
FOR / / AGAINST / / ABSTAIN / /
If you wish to have any comments forwarded to the Company, you must mark this box and then write your comments on the reverse side of this form. / /
Special Action:
Discontinue Annual Report mailing for this account: / /
_______________________ ____________________ ACCOUNT NUMBER SHARES PLEASE MARK ALL CHOICES LIKE THIS: /X/ SIGNATURE ______________________ DATE ______________ |