UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-12
IDACORP, Inc. and Idaho Power Company
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(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
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[Logo] IDACORP
[Logo] IDAHO POWER
An IDACORP Company
NOTICE OF JOINT ANNUAL MEETING OF SHAREHOLDERS
May 20, 2004, AT BOISE, IDAHO
April 12, 2004
TO THE SHAREHOLDERS OF IDACORP, INC. AND IDAHO POWER COMPANY:
Notice is hereby given that the Joint Annual Meeting of Shareholders of
IDACORP, Inc. ("IDACORP") and Idaho Power Company ("Idaho Power") will be held
on May 20, 2004 at 10:00 a.m. local time at the Idaho Power Corporate
Headquarters Building, 1221 West Idaho Street, Boise, Idaho, for the following
purposes:
1. to elect three Directors of IDACORP and Idaho Power for a three year
term;
2. to ratify the selection of Deloitte & Touche LLP as independent auditor
for IDACORP and Idaho Power for the fiscal year ending December 31,
2004;
3. to act upon a shareholder proposal requesting IDACORP to publish
annually in the Proxy Statement an explanation of Board procedures
governing donations to and a list of Board approved private foundations;
and
4. to transact such other business that may properly come before the
meeting and any adjournment or adjournments thereof.
Common shareholders of record of IDACORP and Idaho Power and holders of
Idaho Power 4% Preferred Stock and 7.68% Series, Serial Preferred Stock, at the
close of business on April 1, 2004, are entitled to vote at the meeting.
All shareholders are cordially invited to attend the Joint Annual Meeting
in person. Shareholders interested in attending in person must make a
reservation by calling (800) 635-5406. WHETHER OR NOT YOU PLAN TO ATTEND, PLEASE
VOTE YOUR PROXY PROMPTLY. It is important that your shares be represented at the
meeting. Please vote your proxy, regardless of the size of your holdings, as
promptly as possible. Any shareholder voting a proxy who attends the meeting may
vote in person by revoking that proxy prior to or at the meeting.
By Order of the Boards of Directors
Robert W. Stahman
Corporate Secretary
TO SHAREHOLDERS WHO RECEIVE MULTIPLE PROXIES IF YOU OWN
IDACORP COMMON STOCK OR IDAHO POWER PREFERRED STOCK OTHER THAN THE SHARES SHOWN
ON THE ENCLOSED PROXY, YOU WILL RECEIVE A PROXY IN A SEPARATE ENVELOPE FOR EACH
SUCH HOLDING. PLEASE VOTE EACH PROXY RECEIVED.
TABLE OF CONTENTS
Page
----
Notice of Annual Meeting................................................ 1
Joint Proxy Statement................................................... 3
General Information............................................ 3
Cost and Method of Solicitation................................ 3
Matters to be Voted Upon....................................... 3
Record Date.................................................... 3
Outstanding Voting Securities.................................. 3
Voting......................................................... 4
Secret Ballot.................................................. 5
Election of Directors.......................................... 5
The Boards of Directors and Committees......................... 8
Corporate Governance........................................... 10
Ratification of Appointment of Independent Auditor............. 12
Report of the Audit Committees................................. 13
Independent Accountant Billings................................ 14
Shareholder Proposal........................................... 15
Other Business................................................. 16
Principal Shareholders......................................... 16
Security Ownership of Directors and Executive Officers......... 17
Compensation of Directors and Executive Officers............... 18
Report of the Compensation Committees................. 18
Summary Compensation Table............................ 21
Option/SAR Grants in Fiscal Year 2003................. 22
Aggregated Option/SAR Exercises....................... 22
Director Compensation................................. 23
Employment Contracts and Change of Control Agreements. 23
Performance Graph..................................... 24
Retirement Benefits................................... 25
Annual Report.................................................. 26
2005 Joint Annual Meeting of Shareholders...................... 26
Exhibits
Exhibit A Charter of the IDACORP Audit Committee
Exhibit B Audit Committee Policy for Pre-Approval of Independent
Auditor Services
JOINT PROXY STATEMENT
IDACORP, Inc.
Idaho Power Company
1221 West Idaho Street
P.O. Box 70
Boise, Idaho 83707-0070
GENERAL INFORMATION
This Joint Proxy Statement and the accompanying form of proxy will first be
sent to shareholders on or about April 12, 2004 and are provided to the
shareholders of IDACORP and Idaho Power in connection with the solicitation of
proxies on behalf of the Boards of Directors of IDACORP and Idaho Power for use
at their Joint Annual Meeting of Shareholders and any adjournments or
postponements thereof. The Joint Annual Meeting is scheduled to be held on May
20, 2004, at 10:00 a.m., local time, at the Idaho Power Corporate Headquarters
Building, 1221 West Idaho Street, Boise, Idaho.
COST AND METHOD OF SOLICITATION
The cost of soliciting proxies will be paid by IDACORP and Idaho Power. In
order to be assured that a quorum of outstanding shares will be represented at
the meeting, proxies may be solicited by officers and regular employees of
IDACORP or Idaho Power, personally or by telephone, telegraph, fax, mail or
other electronic means, without extra compensation. In addition, the
solicitation of proxies from brokers, banks, nominees and institutional
investors will be made by Georgeson Shareholder Communications, Inc. at a cost
of approximately $4,000 plus out-of-pocket expenses. IDACORP and Idaho Power
will reimburse banks, brokerage firms and other custodians, nominees and
fiduciaries for their expenses in sending proxy materials to beneficial owners.
MATTERS TO BE VOTED UPON
As of April 12, 2004, the only known business to be presented at the 2004
Joint Annual Meeting of shareholders is as follows. Shareholders of IDACORP will
vote on (1) the election of three Directors of IDACORP, (2) the ratification of
the appointment of Deloitte & Touche LLP as independent auditors of IDACORP, and
(3) if presented, a shareholder proposal regarding publishing an explanation of
the Board's procedures governing certain charitable contributions. Shareholders
of Idaho Power will vote on (1) the election of three Directors of Idaho Power
and (2) the ratification of the appointment of Deloitte & Touche LLP as
independent auditors of Idaho Power. See "Other Business."
RECORD DATE
The Boards of Directors have fixed April 1, 2004, as the date for the
determination of shareholders of IDACORP and Idaho Power entitled to notice of
and to vote at the meeting. Only shareholders of record at the close of business
on April 1, 2004 will be entitled to vote at the meeting.
OUTSTANDING VOTING SECURITIES
The outstanding voting securities of IDACORP as of the record date for the
meeting are 38,165,800 shares of common stock, no par value, each share being
entitled to one vote.
As a result of the formation of the holding company on October 1, 1998,
IDACORP holds 100% of the issued and outstanding shares of common stock of Idaho
Power and approximately 94% of the total voting power of Idaho Power. The
outstanding shares of Idaho Power's preferred stock were unchanged by the
formation of holding company and continue to be outstanding shares. Holders of
voting preferred stock of Idaho Power hold approximately 6% of Idaho Power's
total outstanding voting power.
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The outstanding voting securities of Idaho Power as of the record date for
the meeting are as follows: 39,150,812 shares of common stock, $2.50 par value,
held by IDACORP, each share being entitled to one vote; 123,311 shares of 4%
Preferred Stock, $100 par value, each share being entitled to twenty votes; and
150,000 shares of 7.68% Series, Serial Preferred Stock, $100 par value, each
share being entitled to one vote. The aggregate voting power of outstanding
voting securities for Idaho Power is 41,767,032 votes.
VOTING
Shareholders of record may vote their proxies by telephone, through the
Internet or by marking, signing, dating and returning the proxy card in the
enclosed postage-prepaid envelope.
Shareholders whose shares are held by a bank or broker may be able to vote
by telephone or through the Internet. Follow the instructions you receive from
your bank or broker.
Shareholders voting through the Internet should understand that there may
be costs associated with electronic access, such as usage charges from Internet
access providers and telephone companies; such charges must be paid by the
shareholder.
IDACORP and Idaho Power have been advised by counsel that the procedures
for Internet and telephone voting are consistent with the requirements of
applicable law.
Under the Idaho Business Corporation Act, 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 of each company is present,
the following votes are required for approval of each proposal at the Joint
Annual Meeting:
(i) Proposal No. 1 - directors of IDACORP and Idaho Power are elected by
the affirmative vote of a plurality of the votes cast by the shares entitled to
vote in the election of directors for that company. Votes may be cast in favor
or withheld; votes that are withheld will have no effect on the results.
(ii) Proposal No. 2 - the ratification of the selection of an independent
auditor for IDACORP and Idaho Power is approved where the votes cast within the
voting group in favor exceed the votes cast opposing ratification for that
company.
(iii) Proposal No. 3 - a shareholder proposal regarding publishing annually
an explanation of Board procedures governing certain charitable contributions is
approved when the IDACORP votes cast within the voting group in favor exceed the
votes cast against the proposal.
Abstentions and broker non-votes, if any, will have no effect on the
results with respect to Proposals 2 and 3.
If no direction is given by a shareholder, properly executed proxies
received will be voted FOR Proposal No. 1, election of the nominees for
Directors, FOR Proposal No. 2, ratification of the selection of Deloitte &
Touche LLP as independent auditor for the fiscal year 2004, and AGAINST Proposal
No. 3, the shareholder proposal regarding publishing an annual explanation of
Board procedures governing certain charitable contributions.
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 should be unable to do so,
the proxies will be voted for nominees selected by the appropriate Board of
Directors.
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 Secretary of IDACORP or Idaho Power at 1221 West Idaho Street,
Boise, Idaho 83702-5610, and received prior to the meeting.
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SECRET BALLOT
It is the policy of IDACORP and Idaho Power that all proxies for the Joint
Annual Meeting 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 IDACORP or Idaho Power
representatives or to any third party. Proxies are returned to the independent
tabulator who receives, inspects and tabulates the proxies. Individual voted
proxies and ballots are not seen by or reported to IDACORP or Idaho Power 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 Securities and Exchange Commission, or (iv) to
respond to shareholders who have written comments on their proxies.
1. ELECTION OF DIRECTORS
IDACORP's and Idaho Power's Boards of Directors each consist of the same 10
members. IDACORP's Articles of Incorporation, as amended, and Idaho Power's
Restated Articles of Incorporation, as amended, provide that Directors are
elected for three-year terms, with approximately one-third of the Board of
Directors elected at each annual meeting of shareholders. The three Directors
standing for election for the IDACORP and Idaho Power Boards of Directors at the
2004 Joint Annual Meeting are identified below as nominees for election with
terms to expire in the year 2007. All nominees are currently Directors of
IDACORP and Idaho Power. Mrs. Evelyn Loveless retired from the Boards on July
25, 2003, and Mr. John B. Carley retired from the Boards on January 4, 2004,
both having reached the mandatory retirement age of 70. Mrs. Loveless served as
a director since 1987 and Mr. Carley since 1990. The Boards thank Mrs. Loveless
and Mr. Carley for their many years of distinguished service to IDACORP and
Idaho Power.
Unless otherwise instructed, proxies received will be voted in favor of the
election of the Director nominees of the appropriate company. 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 should be unable to do so, the proxies
will be voted for nominees selected by the appropriate Board of Directors.
EACH BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" ITS NOMINEES
LISTED BELOW.
IDACORP AND IDAHO POWER NOMINEES FOR ELECTION - TERMS EXPIRE 2007
ROTCHFORD L. BARKER......... Director, American Ecology Corporation (provider
of environmental services to producers and
handlers of hazardous, toxic and radioactive
wastes)(since 1996); Member and former director
Chicago Board of Trade (since 1964); director of
IDACORP and Idaho Power since 1999. Age 67
JON H. MILLER................. Chairman of the Board of IDACORP and Idaho Power
since 1999; Private Investor; formerly President
and Chief Operating Officer (1978-1990) and a
director (1977-1990) of Boise Cascade
Corporation (distributor of office products and
building materials and an integrated
manufacturer and distributor of paper, packaging
and wood products); director of Idaho Power
since 1988 and IDACORP since 1998. Age 66
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ROBERT A. TINSTMAN.......... Former President and Chief Executive Officer
(1995-1999) and director (1995-1999) of Morrison
Knudsen Corporation (general contractor
providing global mining, engineering and
construction services); director of Home Federal
Savings & Loan (banking services) (since 1999);
former Chairman of Contractorhub.com
(e-marketplace for contractors, subcontractors
and suppliers) (2000-2001); Executive Chairman
of James Construction Group (construction
services) (since 2002); director of IDACORP
Technologies, Inc.; director of IDACORP and
Idaho Power since 1999. Age 57
IDACORP AND IDAHO POWER CONTINUING DIRECTORS - TERMS EXPIRE 2006
CHRISTOPHER L. CULP, Ph.D..... President, Risk Management Consulting, Inc.
(specialty consulting firm providing risk
management services for securities and futures
exchanges, commercial and investment banks,
insurance companies, trade associations, law
firms, accounting firms and public utilities)
(since 1994); Adjunct Professor of Finance,
Graduate School of Business at the University of
Chicago (since 1997); Professor, University of
Bern, Switzerland (since 2001); director of
IDACORP and Idaho Power since 2002. Age 35
GARY G. MICHAEL.............. Former Chairman of the Board and Chief Executive
Officer (1991-2001) of Albertson's, Inc.
(food-drug retailer); director of The Clorox
Company (manufacturer and marketer of household
products) (since 2001); Boise Cascade
Corporation (distributor of office products and
building materials and an integrated
manufacturer and distributor of paper, packaging
and wood products) (since 1997); Harrah's
Entertainment, Inc. (casino entertainment)
(since 2001); Questar, Inc. (integrated natural
gas company) (since 1994); Graham Packaging
Company (a designer and manufacturer of
customized plastic containers)(Advisory Board)
(since 2001); director of IDACORP and Idaho
Power since 2001. Age 63
PETER S. O'NEILL.............. Chairman and Chief Executive Officer of O'Neill
Enterprises L.L.C. (developer of planned
communities) (since 1990); director of Building
Materials Holding Corporation (provider of
construction services, manufactured building
components and materials to professional
residential builders and contractors) (since
1993); director of IDACORP Financial Services,
Inc. (since 1999); director of Idaho Power since
1995 and IDACORP since 1998. Age 67
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JAN B. PACKWOOD............... President and Chief Executive Officer of IDACORP
(since 1999) and Chief Executive Officer of
Idaho Power (since 2002); formerly President and
Chief Executive Officer (1999-2002); President
and Chief Operating Officer (1997-1999);
Executive Vice President (1996-1997) and Vice
President - Bulk Power (1989-1996) of Idaho
Power; director and President of Idaho Energy
Resources Company; director of IDACORP Financial
Services, Inc.; director of Ida-West Energy
Company; director of IDACOMM; director of
IDACORP Services Co.; director of IDACORP
Technologies, Inc; director of Velocitus;
director of Idaho Power since 1997 and IDACORP
since 1998. Age 61
IDACORP AND IDAHO POWER CONTINUING DIRECTORS - TERMS EXPIRE 2005
JACK K. LEMLEY.............. Director of Lemley & Associates, Inc.
(management consulting company) (since 1987);
formerly Chairman of the Board and Chief
Executive Officer and a director of American
Ecology Corp. (provider of environmental
services to producers and handlers of hazardous,
toxic and radioactive wastes) (1995-2001);
director of IDACORP Technologies, Inc.; director
of Idaho Power since 1995 and IDACORP since
1998. Age 69
RICHARD G. REITEN............ Chairman of the Board of Northwest Natural
(provider of natural gas in Oregon and southwest
Washington) (since 2000); formerly President and
Chief Executive Officer (1997-2000), and
President and Chief Operating Officer
(1995-1997); former President and Chief
Operating Officer of Portland General Electric
(electric public utility) (1992-1995); former
President of Portland General Corp. (1989-1992);
director of U.S. Bancorp (banking services);
Building Materials Holding Corp. (provider of
construction services, manufactured building
components and materials to professional
residential builders and contractors); and ESCO
Corp. (manufacturer of engineered metal parts
and components for industrial machinery);
director of IDACORP and Idaho Power since 2004.
Age 64
THOMAS J. WILFORD............ President of Alscott, Inc. (real estate
development and other investments) since 1993;
Chief Executive Officer of J.A. and Kathryn
Albertson Foundation, Inc. (a family foundation
committed and striving to be a catalyst for
positive educational change) since 2003 and
formerly President (1995-2003); director of
IDACORP and Idaho Power since 2004. Age 61
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THE BOARDS OF DIRECTORS AND COMMITTEES
The IDACORP and Idaho Power Boards of Directors each held seven meetings in
2003. The average attendance during 2003 at all meetings of the Boards and all
meetings of the committees of the Boards was 94 percent.
Independence
IDACORP and Idaho Power Company currently have ten members on their Boards
of Directors. All are non-employees, except for Jan Packwood, the President and
Chief Executive Officer of IDACORP and the Chief Executive Officer of Idaho
Power. All non-employee directors have been determined by the Boards of
Directors to be "independent" based on all relevant facts and circumstances and
under the New York Stock Exchange listing standards and the Corporate Governance
Guidelines, which contain the policy and categorical standards on director
independence. The office of the Chairman of the Board and the Chief Executive
Officer have been separated since June 1999. The non-employee directors have
held meetings separate from management since 1998. Mr. Miller, the independent
Chairman of the Board, presides at Board meetings and executive sessions of
non-management directors.
Committees
The standing committees of each of IDACORP and Idaho Power are the
Executive Committee, the Audit Committee, the Compensation Committee and the
Corporate Governance Committee. The Investment Committee was eliminated
effective July 17, 2003. The members of the committees are the same for both
IDACORP and Idaho Power. IDACORP has one committee which Idaho Power does not
have -- the Committee of Outside Directors. Board committees, their membership
during 2003 and a brief statement of their principal responsibilities are
presented below.
Executive Committees
The Executive Committees act on behalf of the Boards of Directors of
IDACORP and Idaho Power, as applicable, when the respective Boards are not in
session, except on those matters which require action of the full Board. Members
of the Committees are Jan B. Packwood (Chairman), John B. Carley (until his
retirement from the Board), Jack K. Lemley, Jon H. Miller and Robert A.
Tinstman. During 2003, the Idaho Power Executive Committee met three times.
Audit Committees
The Audit Committees of IDACORP and Idaho Power, which are
separately-designated standing committees established in accordance with Section
3(a)(58)(A) of the Securities Exchange Act of 1934, as amended, are comprised of
four independent directors, as that term is defined in the listing standards of
the NYSE. All members are "financially literate" as the Board of Directors
interprets that term, and Mr. Michael and Mr. Barker have been determined to be
"audit committee financial experts." The IDACORP Audit Committee Charter is
filed as Exhibit A to this proxy statement. The Idaho Power Audit Committee
Charter is a mirror charter to that of IDACORP.
Mr. Michael serves on the audit committee of three other public companies
in addition to IDACORP and Idaho Power. The Boards of Directors of IDACORP and
Idaho Power have determined that such service will not impair Mr. Michael's
ability to serve on the IDACORP and Idaho Power Audit Committees.
The Audit Committees of IDACORP and Idaho Power assist the Boards of
Directors in fulfilling oversight responsibilities on the integrity of the
IDACORP and Idaho Power financial statements; complying with legal and
regulatory requirements; reviewing the qualifications, independence and
performance of the independent auditors; evaluating the performance of the
internal audit function and
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producing the Audit Committee Report as required by the Securities and Exchange
Commission to be included in the proxy statement for the annual meeting of
shareholders. Members of the Committees are Jack K. Lemley (Chairman), Rotchford
L. Barker, Christopher L. Culp and Gary G. Michael. During 2003, the IDACORP and
Idaho Power Audit Committees met eleven times.
Compensation Committees
The Compensation Committees of IDACORP and Idaho Power have direct
responsibility to review and approve corporate goals and objectives relevant to
Chief Executive Officer compensation, evaluate the Chief Executive Officer's
performance in light of those goals and objectives, and, either as a committee
or together with the other independent directors (as directed by the Boards),
determine and approve the Chief Executive Officer's compensation level based on
this evaluation. The Compensation Committees also make recommendations to the
Boards with respect to non-Chief Executive Officer compensation,
incentive-compensation plans and equity-based plans; produce the Compensation
Committee report on executive compensation as required by the Securities and
Exchange Commission to be included in the proxy statement for the annual meeting
of shareholders; and oversee the compensation and employee benefit plans and
practices. Members of the Committees are Robert A. Tinstman (Chairman), John B.
Carley (until his retirement from the Board), Evelyn Loveless (until her
retirement from the Board), Peter S. O'Neill, Richard G. Reiten and Thomas J.
Wilford. During 2003, the IDACORP and Idaho Power Compensation Committees met
five times.
Corporate Governance Committees
The Corporate Governance Committees of IDACORP and Idaho Power, established
November 1, 2002, identify individuals qualified to become directors, consistent
with criteria approved by the Board, and select, or recommend that the Board
select, the candidates for all directorships to be filled by the Boards or by
the shareholders; develop and recommend to the Boards a set of corporate
governance principles applicable to each company; oversee the evaluation of the
Boards and management; review the compliance programs including the Code of
Business Conduct and Ethics; and take a leadership role in shaping the corporate
governance of IDACORP and Idaho Power. Members of the Committees are Gary G.
Michael (Chairman), Christopher L. Culp, Jon H. Miller and Peter S. O'Neill.
During 2003, the IDACORP and Idaho Power Corporate Governance Committees met
five times.
Committee of Outside Directors
The Committee of Outside Directors of IDACORP, prior to 2003, assisted the
Board of Directors by reviewing and evaluating the performance of the Chief
Executive Officer and establishing individual and corporate goals and strategies
relating to the Chief Executive Officer. It also acted in 2002, before the
establishment of the Corporate Governance Committee, as a nominating committee.
Members of the Committee are all members of the IDACORP Board of Directors who
are not officers or employees or former officers of IDACORP or one of its
subsidiaries. Members of the Committee are Rotchford L. Barker, John B. Carley
(until his retirement from the Board), Christopher L. Culp, Gary G. Michael,
Jack K. Lemley, Evelyn Loveless (until her retirement from the Board), Jon H.
Miller, Peter S. O'Neill, Richard G. Reiten, Robert A. Tinstman and Thomas J.
Wilford. During 2003, the Committee of Outside Directors met six times.
Attendance at Annual Meetings
Pursuant to the Corporate Governance Guidelines of IDACORP and Idaho Power,
all Directors are expected to attend the annual meeting of shareholders and be
available, when requested by the chair, to answer any questions shareholders may
have. All members of the Boards of Directors of IDACORP and Idaho Power attended
last year's annual meeting.
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CORPORATE GOVERNANCE
Background
IDACORP and Idaho Power have adopted corporate governance and disclosure
requirements under the Sarbanes-Oxley Act of 2002, the Securities and Exchange
Commission's rules interpreting and implementing the Sarbanes-Oxley Act, the new
listing standards of the New York Stock Exchange and SEC disclosure requirements
on expanded nominating committee processes. This includes (1) written charters
for the Audit Committees, Corporate Governance Committees (which are also the
Nominating Committees) and Compensation Committees and (2) Corporate Governance
Guidelines, which address issues including the responsibilities, qualifications
and compensation of the Board of Directors, as well as Board leadership, Board
committees and self-evaluation. The written charters and the Corporate
Governance Guidelines of IDACORP and Idaho Power are available on IDACORP's
website and may be accessed at http://www.idacorpinc.com/CorpGov/default.htm.
Printed copies may be obtained without charge by writing to the Secretary of
IDACORP or Idaho Power at 1221 West Idaho, Boise, Idaho 83702-5610.
Code of Ethics
Idaho Power has had for many years a Code of Business Conduct and Ethics,
which applied to all directors, officers and employees of Idaho Power, including
the principal executive officer and senior financial and accounting officers.
IDACORP adopted a new Code of Business Conduct and Ethics in July 2003, which
applies to all directors, officers, including the chief executive officer,
principal financial and accounting officers, and employees of IDACORP and its
subsidiaries. The Code of Conduct may be accessed at the IDACORP website
referred to above. Printed copies may be obtained without charge by writing to
the Secretary, IDACORP, Inc., 1221 West Idaho, Boise, Idaho 83702-5610.
Amendments to the Code or waivers of the Code as required by Regulation
S-K, Item 406 or the New York Stock Exchange listing standards will be posted on
the IDACORP website referred to above.
Process for Shareholders to Recommend Nominees for Directors
IDACORP and Idaho Power have processes in place which permit shareholders
to recommend directors in accordance with the By-Laws and Corporate Governance
Guidelines. Shareholders wishing to recommend a candidate to be considered by
the Corporate Governance Committee for nomination as a Director must submit
recommendations in writing to the Secretary of IDACORP and/or Idaho Power no
later than 120 days prior to the first anniversary of the date on which the
Companies mailed proxy materials for the preceding year. In the event of a
special meeting of shareholders for electing one or more directors,
recommendations must be submitted in writing no later than the close of business
on the tenth day after the day of the public announcement of such meeting and of
director nominees proposed by the Boards of Directors. The written
recommendations must include all information with respect to the candidate
required to be disclosed in the solicitation of proxies pursuant to Regulation
14A under the Securities Exchange Act of 1934, as amended, and the rules
thereunder, including the recommended candidate's consent. The shareholder
submitting the recommendations must provide his or her name, address and class
and number of shares of voting stock owned beneficially and of record including
a statement as to how long the shareholder has held such stock. The Secretary
will review all written recommendations and send those conforming to the
requirements to the Corporate Governance Committee.
Board Membership Criteria
Directors should possess the highest personal and professional ethics,
integrity and values, and be committed to representing the long-term interests
of the shareholders. They must also have an inquisitive and objective
perspective, practical wisdom and mature judgment. IDACORP and Idaho Power
endeavor to have a Board representing diverse experience at policy-making levels
in business,
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finance and accounting and in areas that are relevant to the company's
activities. At least one Director shall meet the requirements of the definition
of an "audit committee financial expert" as that term is defined in Item 401(h)
of Regulation S-K. Directors are required to retire upon reaching age 70.
Non-employee directors should be "independent" under the New York Stock
Exchange listing standards.
Process for Determining Director Nominees
The Corporate Governance Committee follows the procedures set forth below
when identifying new Director nominees, including any recommendations submitted
by shareholders in compliance with the By-laws and the policies set forth
herein:
o the Corporate Governance Committee identifies the need to fill a
vacancy on the Board or, if approved by the Board, to add new Board
member(s);
o the Chairman of the Corporate Governance Committee initiates the
search,
- soliciting advice from the Chairman of the Board, the Lead
Independent Director, the Chief Executive Officer, other
directors, management and any other persons he or she deems
appropriate,
- reviewing any candidates submitted by shareholders in compliance
with the By-laws and the policies set forth herein, and
- hiring a search firm, if he or she chooses;
o an initial group of candidates is identified and presented to the
Corporate Governance Committee;
o the Corporate Governance Committee gathers any additional information
it deems appropriate, including information necessary to determine if
the candidate(s)
- are "independent" under applicable laws, regulations and rules,
- do not violate any requirements applicable to the Company or any
federal or state laws, rules or regulations, including federal
and state regulatory agencies, the New York Stock Exchange, the
Securities and Exchange Commission and the Sarbanes-Oxley Act of
2002, and
- meet all requirements under these Corporate Governance
Guidelines, committee charters, the By-laws, the Codes and any
other applicable corporate document or policy;
o the Corporate Governance Committee evaluates any potential conflicts,
including financial or business relationships;
o the Corporate Governance Committee evaluates whether the candidates
would likely represent a special interest or single issue;
o the Corporate Governance Committee meets to narrow the list of
candidates;
o the Chairman of the Board, the Corporate Governance Committee and the
Chief Executive Officer interview any or all of the candidates, if
they deem it appropriate;
o the Corporate Governance Committee meets to consider and approve the
final candidate(s);
o the Corporate Governance Committee seeks full Board approval of the
selected candidate(s).
The Chairman keeps the full Board informed of the Committee's progress.
11
How to Contact the Board and the Audit Committee
The Boards of Directors of IDACORP and Idaho Power have developed a process
by which shareholders can send communications to members of the Boards. If you
have a concern that you believe warrants the attention of the Boards of
Directors, including the Chairman of the Board or non-management directors as a
group, you may call a toll-free helpline at 1-866-384-4277. If your concern is
of an ethical nature, you may log on to www.ethicspoint.com, and follow the
instructions for filing a report. All reports will be routed to the General
Counsel who then forwards the report directly to the Chairman of the Board. Any
report regarding questionable accounting practices, internal accounting controls
or auditing matters will be routed by the General Counsel to the Chairman of the
Board and the Chairman of the Audit Committee.
2. RATIFICATION OF APPOINTMENT OF
INDEPENDENT AUDITOR
At the Joint Annual Meeting, the shareholders will be asked to ratify the
selection by the Audit Committees of the IDACORP and the Idaho Power Boards of
Directors of Deloitte & Touche LLP as the firm of independent public accountants
to audit the financial statements of IDACORP and Idaho Power for the fiscal year
2004. This firm has conducted consolidated annual audits of IDACORP and Idaho
Power 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.
EACH BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" DELOITTE &
TOUCHE LLP AS INDEPENDENT AUDITOR OF IDACORP AND IDAHO POWER.
12
REPORT OF THE AUDIT COMMITTEES
OF THE BOARD OF DIRECTORS
The Audit Committees of the IDACORP and Idaho Power Boards of Directors
(collectively, the Committee) are each composed of four directors, who are
"independent" as defined in the applicable NYSE listing standards. Each
Committee has a written charter adopted by its Board of Directors. The charters
are posted on the Company's website at www.idacorpinc.com. The IDACORP Audit
Committee Charter is filed as Exhibit A to this proxy statement. The Idaho Power
Audit Committee Charter is a mirror charter to that of IDACORP.
The Committee has reviewed and discussed the audited consolidated financial
statements of IDACORP and Idaho Power with management and the independent
auditors. The Committee discussed with the independent auditors the matters
required to be discussed by Statement on Auditing Standards No. 61
(Communication with Audit Committees), as modified or supplemented.
The independent accountants also provided to the Committee the written
disclosures and the letter required by Independence Standards Board Standard No.
1 (Independence Discussions with Audit Committees), as modified or supplemented,
and the Committee discussed with the independent accountants that firm's
independence.
Based on the Committees' review and discussions referred to above, the
Committee recommended to each Board of Directors that the audited consolidated
financial statements of IDACORP and Idaho Power be included in their combined
Annual Report on Form 10-K for the year ended December 31, 2003 for filing with
the Securities and Exchange Commission.
Jack K. Lemley (Chairman)
Rotchford L. Barker
Christopher L. Culp
Gary G. Michael
13
INDEPENDENT ACCOUNTANT BILLINGS
Aggregate fees billed to IDACORP and Idaho Power Company for the fiscal
years ended December 31, 2003 and 2002 by the Company's principal accounting
firm, Deloitte & Touche LLP, the member firms of Deloitte Touche Tohmatsu, and
their respective affiliates (collectively, the "Deloitte Entities"):
Fees Billed 2003 2002
- ----------- -------- ---------
Audit fees.......................................... $531,470 $ 446,170
Audit-related fees (a).............................. 315,502 610,238
-------- ----------
Total Audit and Audit-related fees.................. 846,972 1,056,408
Tax fees (b)........................................ 137,234 836,296
All other fees (c).................................. - 0 - 141,816
-------- ----------
Total fees.......................................... $984,206 $2,034,520
======== ==========
- --------------
(a) Includes fees for audits of the Company's benefit plans, stand alone audits
of subsidiaries, internal control work related to network security and
information systems, Officer certification assistance, Sarbanes-Oxley
Section 404 readiness assistance and work in connection with regulatory
inquiries.
(b) Includes fees for tax compliance and tax consulting in connection with IRS
account analysis.
(c) Includes fees for non-financial advisory services, internal audit support
services and work in connection with regulatory inquiries.
Auditor Independence. The Audit Committee has considered whether the
provision of the above noted services is compatible with maintaining the
principal auditor's independence.
Policy on Audit Committee Pre-Approval. IDACORP and Idaho Power and the
Audit Committees are committed to ensuring the independence of the independent
auditor, both in fact and in appearance. In this regard, the Audit Committees
have established a pre-approval policy in accordance with applicable securities
rules. The Audit Committee's Policy for the Pre-Approval of Independent Auditor
Services is included as Exhibit B to this Proxy Statement. All fees were
pre-approved by the Audit Committees in 2003.
14
3. SHAREHOLDER PROPOSAL
Mr. John Jennings Crapo, P.O. Box 400151, Cambridge Massachusetts,
02140-0002, who holds of record 524.698 shares of IDACORP common stock, has
notified IDACORP in writing that he intends to submit the proposal set forth
below for consideration at the Annual Meeting. The SEC permitted IDACORP to
exclude the supporting statement submitted by Mr. Crapo under Rule 14a-8(i)(3)
of the Securities and Exchange Commission's proxy rules as vague and indefinite.
MY SHAREHOLDER PROPOSAL
Shareholders recommend that the Board of Directors ("Our Board") of IDACORP
publish in the Proxy Statement of each shareholder annual meeting in the
Appendix containing an item the charitable donations program of our corporation
for the immediate past calendar year with the following data:
i. An explanation of at least five hundred words explaining the standards
of Our Board and procedures of it governing. The Corporation's
donations to United States of American Internal Revenue Service
("Svce") approved private foundations to include standards for denial
of such help.
ii. An enumeration of such said qualifying charities and approved
foundations which Our Board plans as our corporate governance to help
in the ensuing calendar year included with each charity and foundation
an elucidation of at least twenty-five words how it complied with the
standards and procedures enumerated in i.
THE BOARD OF DIRECTORS OF IDACORP HAS CONSIDERED THIS PROPOSAL AND
RECOMMENDS THAT SHAREHOLDERS VOTE "AGAINST" IT FOR THE FOLLOWING REASONS:
The Board opposes Mr. Crapo's proposal because it believes that
implementation of the proposal would cause IDACORP to incur undue cost and
expense to publish additional information not required to be included in its
proxy statement without providing any additional meaningful benefit to our
shareholders.
Although Mr. Crapo's proposal is unclear, we believe that his reference to
"Internal Revenue Service approved private foundations" means charitable
organizations, such as family-sponsored foundations, that do not receive broad
public support. Neither IDACORP nor its subsidiaries generally make any
contributions to private foundations.
IDACORP's principal means of making charitable contributions to non-profit
charitable organizations is through the Idaho Power Contributions Program.
Through this program, Idaho Power provides financial support to qualifying
organizations and offers academic scholarships to area students seeking higher
education. Information regarding Idaho Power's charitable contribution program
is published on Idaho Power's website
http://www.idahopower.com/aboutus/community/scholarship.htm. Along with other
supporting information, the website provides detailed information regarding
contribution guidelines and standards, identification and descriptions of
specific programs sponsored by Idaho Power and relevant application procedures.
In the past, neither the IDACORP nor the Idaho Power Boards of Directors have
been involved in the contribution process nor has either Company regularly
published the name of the recipients of any contributions.
IDACORP believes that requiring the publication of the information
requested by Mr. Crapo in the proxy statement would result in increased costs
without providing any additional meaningful information to our shareholders.
THEREFORE, THE IDACORP BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE
"AGAINST" THIS PROPOSAL.
15
OTHER BUSINESS
Neither the IDACORP nor the Idaho Power 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 Joint Proxy Statement. The IDACORP Board of
Directors has been informed that the shareholder proposal discussed in this
Proxy Statement will be presented to the meeting by the shareholder. In
addition, another shareholder may nominate another person to the Board of
Directors of IDACORP. The proxies intend to cast their votes against the
shareholder proposal discussed in the Proxy Statement and in favor of the
IDACORP nominees listed in the Proxy Statement. 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.
PRINCIPAL SHAREHOLDERS
The following table presents certain information regarding shareholders who
are known to IDACORP or Idaho Power to be the beneficial owners of more than 5
percent of any class of voting securities of IDACORP or Idaho Power as of March
1, 2004:
Name and Address Amount and Nature of Percent
Class of Stock of Beneficial Owner Beneficial Ownership of Class
- -------------- --------------------- -------------------- --------
Idaho Power IDACORP, Inc. (1) 39,150,812 100
Common Stock 1221 W. Idaho Street
Boise, Idaho 83702
- --------------
(1) As a result of the formation of the holding company, IDACORP became the
holder of all issued and outstanding shares of Idaho Power common stock on
October 1, 1998.
16
SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth the number of shares of IDACORP common stock
and Idaho Power preferred stock beneficially owned on March 1, 2004, by the
Directors and nominees, by those Executive Officers named in the Summary
Compensation Table and by the Directors and Executive Officers of IDACORP and
Idaho Power as a group:
Amount of
Beneficial Stock Percent
Title of Class Name of Beneficial Owner Ownership(1) Options(2) Of Class
- -------------- -------------------------- ------------ --------- --------
Common Stock Rotchford L. Barker....... 13,481 1,650 *
Common Stock Christopher L. Culp, Ph.D. 2,859 1,650 *
Common Stock Jack K. Lemley (3)........ 4,981 1,650 *
Common Stock Gary G. Michael........... 6,072 1,650 *
Common Stock Jon H. Miller............. 3,981 1,650 *
Common Stock Peter S. O'Neill.......... 5,093 1,650 *
Common Stock Jan B. Packwood........... 222,491 159,600 *
Common Stock Richard G. Reiten (4)..... - 0 - - 0 - *
Common Stock Robert A. Tinstman........ 6,481 1,650 *
Common Stock Thomas J. Wilford (5)..... 200 - 0 - *
Common Stock J. LaMont Keen (6)........ 105,766 72,600 *
Common Stock James C. Miller........... 69,996 58,400 *
Common Stock Robert W. Stahman (7)..... 27,832 6,600 *
Common Stock Darrel T. Anderson........ 23,218 12,200 *
Common Stock A. Bryan Kearney 12,905 6,600 *
Common Stock All Directors and
Executive Officers of
IDACORP as a group
(16 persons).............. 447,303 272,750 *
Preferred Stock All Directors and
Executive Officers of
IDACORP as a group
(16 persons).............. - 0 - - 0 - *
Common Stock All Directors and
Executive Officers of
Idaho Power as a group
(19 persons).............. 540,528 340,150 *
Preferred Stock All Directors and
Executive Officers of
Idaho Power as a group
(19 persons).............. - 0 - - 0 - *
- --------------
* Less than 1 percent.
(1) Includes shares of Common Stock subject to forfeiture and restrictions on
transfer issued pursuant to the 1994 Restricted Stock Plan. Also includes
shares of common stock that beneficial owner has the right to acquire
within 60 days upon exercise of stock options.
(2) Exercisable within 60 days and included in the amount of beneficial
ownership column.
(3) Mr. Lemley disclaims all beneficial ownership of the 2,500 shares owned by
his wife.
(4) Mr. Reiten was elected to the IDACORP and Idaho Power Boards of Directors
on January 15, 2004.
(5) Mr. Wilford was elected to the IDACORP and Idaho Power Boards of Directors
on March 18, 2004.
(6) Mr. Keen disclaims all beneficial ownership of the 187 shares owned by his
wife.
(7) Mr. Stahman disclaims all beneficial ownership of the 26 shares held by his
wife for children.
Except as indicated above, all Directors and Executive Officers have sole
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.
17
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
REPORT OF COMPENSATION COMMITTEES
OF THE BOARDS OF DIRECTORS
ON EXECUTIVE COMPENSATION
GENERAL
The IDACORP and Idaho Power (the "Companies") Compensation Committee
("Committee") established all components of 2003 compensation for the Chief
Executive Officer and the executive officers of the Companies. The Committee is
composed of three non-employee Directors who qualify as independent under the
listing standards of the New York Stock Exchange. The Committee operates under a
written charter which is posted at the Company's website.
As part of its function, the Committee discharges the responsibilities of
the Boards of Directors relating to compensation of the Chief Executive Officer
and the executive officers and oversight of the Companies' compensation and
employee benefit plans and practices. The Committee has the direct
responsibility to (1) review and approve corporate goals and objectives relevant
to Chief Executive Officer compensation, (2) evaluate the Chief Executive
Officer's performance in light of those goals and objectives, and, either as a
committee or together with the other independent directors (as directed by the
Boards), (3) determine and approve the Chief Executive Officer's compensation
level based on this evaluation, (4) make recommendations to the Boards with
respect to non-Chief Executive Officer compensation, incentive-compensation
plans and equity-based plans, (5) produce the Compensation Committee report on
executive compensation as required by the Securities and Exchange Commission
("SEC") to be included in the Company's proxy statement for the annual meeting
of shareholders, and (6) oversee the Company's compensation and employee benefit
plans and practices. Following the development of recommendations by the
Committee, all issues related to executive compensation are submitted to the
other independent directors of the Boards of Directors of IDACORP and Idaho
Power (which are the same) for approval. The independent directors approved,
without modification, all executive compensation recommendations of the
Committee for 2003. The Committee retains an outside consultant specializing in
executive compensation to provide expertise on the Committee's various
responsibilities and other matters coming before the Committee.
COMPENSATION PHILOSOPHY
The Companies' compensation philosophy is designed to:
1. manage employee compensation as an investment with the expectation
that employees will contribute to the Companies' overall success;
2. be competitive with respect to those companies in the markets in which
we compete for employees, allowing the Companies to successfully
attract and retain the qualified employees necessary for long-term
success;
3. recognize individuals for their demonstrated ability to perform their
responsibilities and create long-term shareholder value; and
4. balance total compensation with the Companies' ability to pay.
18
COMPENSATION MARKET FOR 2003
As required by its charter, the Committee reviewed the Companies' executive
compensation program for 2003, including the goals and objectives of the program
and the peer group of companies used for comparison purposes. The Committee
determined that the peer group of companies selected in November 2001 remained
the appropriate group for 2003 compensation purposes. This group is comprised of
fourteen comparable electric utility holding companies with similar business
lines and average annual revenues of $2.2 billion. While this group is different
from the EEI 100 Electric Utilities Index used in the performance graph, the
Committee believes this compensation group is representative of the Companies'
size, complexity and diversity and is appropriate for compensation purposes.
2003 BASE SALARIES
The Committee reviews salary ranges for the Chief Executive Officer and the
executive officers annually, using salary comparisons for similar positions in
the fourteen electric utility holding companies referred to above. However, in
January 2003, the Committee decided that because 2002 had been a difficult
financial year and 2003 was also forecasted to be difficult, the Chief Executive
Officer and the executive officers would receive no base salary increases for
2003.
SHORT-TERM INCENTIVE COMPENSATION
The Executive Incentive Plan ties a portion of the annual compensation of
the Chief Executive Officer and each executive officer to achieving a certain
financial goal. For 2003, the established financial goal was earnings on common
stock for IDACORP with a threshold, target and maximum level. The threshold
level for earnings on common was set at $68.4 million, with the target at $87.2
million and the maximum set at $108.7 million. The award opportunities vary by
position as a percentage of base salary with the award opportunities for the
Chief Executive Officer and the executive officers ranging from a minimum of 15
percent to a maximum of 100 percent. The Executive Incentive Plan does not
permit the payment of awards if there is no payment of awards under the Employee
Incentive Plan. The performance levels within the goal were established based
upon forecasted performance for 2003. In 2003, IDACORP's earnings on common
stock did not reach the threshold level. As such, no payouts were earned for
2003 under the Executive Incentive Plan.
LONG-TERM INCENTIVE COMPENSATION
Long-term incentive awards are intended to develop and retain strong
management through share ownership, recognize future performance and maximize
shareholder value. Restricted stock and stock options were granted to the Chief
Executive Officer and the executive officers in 2003.
When awarding long-term incentives, the Committee considers an executive's
level of responsibility, prior experience and individual performance criteria,
as well as the compensation practices of the group of fourteen electric utility
holding companies used to compare executive compensation. The relative weight
given to each of these factors varies among individuals at the Committee's
discretion.
1. Restricted Stock Plan
In January 2001, a grant of performance shares was made to the executive
officers including the Chief Executive Officer under the 1994 Restricted Stock
Plan. That grant was for a three year restricted period through December 31,
2003, with a target Cumulative Earnings Per Share ("CEPS") of $9.00. The total
CEPS for the three year restricted period was $6.20 resulting in no awards being
earned for the Chief Executive Officer or the executive officers. A new grant of
performance shares under the Plan was made in March 2003, with a three-year
restricted period beginning January 1, 2003 and ending December 31, 2005, with a
single financial performance goal of CEPS. To receive a final share award, the
Chief Executive Officer and each executive officer must be employed, as an
officer, during the entire
19
restricted period (with certain exceptions), and IDACORP must achieve the CEPS
performance goal established by the Committee. The restricted stock grants
(expressed as a percentage of base salary converted into shares of stock based
upon the closing stock price for a share of IDACORP common stock on December 31
of the year preceding the grant) varied by position. The percentages for the
Chief Executive Officer range from a minimum of 18 percent to a maximum of 53
percent. For all other executive officers, the percentages ranged from a minimum
of 13 percent to a maximum of 45 percent. The Committee established the target
grant percentages for new grants as part of its annual executive compensation
review, and the 2003 grants when combined with other forms of long-term
incentive were at a level below the median target levels among the comparison
group.
2. Stock Options
In March 2003, stock options were granted to the Chief Executive Officer
and the executive officers under the IDACORP 2000 Long-Term Incentive and
Compensation Plan. The exercise price of these options is equal to the fair
market value of IDACORP's common stock on the date of grant. The options vest
ratably over five years (20% per year). The size of each award was determined
based on the criteria for awarding long-term incentives discussed above and
ranged from 6,000 to 35,000 options for each of the Vice Presidents, to 65,000
options for the President of Idaho Power to 136,000 options for the Chief
Executive Officer.
The 2003 compensation paid to IDACORP and Idaho Power executive officers
qualified as fully deductible under federal tax laws. The Committee continues to
review the impact of federal tax laws on executive compensation, including
Section 162(m) of the Internal Revenue Code.
CEO COMPENSATION - 2003
As discussed above, the Committee determined not to increase Mr. Packwood's
base salary for 2003. His 2003 salary level was approximately 5 percent below
the median level of salary for chief executive officers for the comparison
group.
Mr. Packwood is a participant in the Executive Incentive Plan with a 2003
award opportunity ranging from a minimum of 25 percent to a maximum of 100
percent of base salary. This award level was established based upon the
executive officer compensation review referenced above. No payouts were earned
under the Executive Incentive Plan for 2003.
Mr. Packwood is a participant in the Restricted Stock Plan as discussed
above. In January 2001, a grant of performance shares was made to Mr. Packwood
under the Restricted Stock Plan for a three year restricted period through
December 31, 2003. The Company did not achieve the minimum level of performance
for the three year restricted period and as a result, Mr. Packwood received no
award under the Restricted Stock Plan for 2003. Mr. Packwood received a grant of
performance shares at the target level of 35 percent in 2003 and will receive a
final share award after the restricted period ends in December 2005 if he
remains employed by the Companies as an officer during the entire restricted
period (with certain exceptions) and IDACORP achieves its CEPS performance goal
established by the Committee.
In addition, Mr. Packwood received a stock option grant of 136,000 shares
in March 2003 under the IDACORP 2000 Long-Term Incentive and Compensation Plan
with an exercise price set at fair market value on the date of grant. The stock
options vest ratably over a five year period (20% per year) contingent upon Mr.
Packwood's continued employment with the Companies. The incentive awards were
intended to place a greater portion of Mr. Packwood's total compensation for
2003 "at risk".
Robert A. Tinstman, Chairman
John B. Carley
Peter S. O'Neill
20
IDACORP AND IDAHO POWER
SUMMARY COMPENSATION TABLE
Long-Term
Annual Compensation Compensation Awards
----------------------- ---------------------------
Restricted Securities
Stock Underlying All Other
Name and Salary Bonus Award(s)(1) Stock Options/ Compensation(2)
Principal Position Year ($) ($) ($) SARs (#) ($)
- ------------------ ---- ------- ------- ----------- -------------- ---------------
Jan B. Packwood.............. 2003 580,000 - 0 - 203,000 136,000 8,000
President and Chief 2002 580,000 - 0 - 203,000 91,000 8,000
Executive Officer, IDACORP 2001 500,000 500,000 175,000 60,000 6,800
and Chief Executive Officer,
Idaho Power
J. LaMont Keen............... 2003 350,000 - 0 - 105,000 65,000 8,000
Executive Vice President, 2002 350,000 - 0 - 105,000 44,000 8,000
IDACORP and President & 2001 300,000 240,000 90,000 30,000 6,800
Chief Operating Officer,
Idaho Power
James C. Miller.............. 2003 250,000 - 0 - 62,500 20,000 8,000
Sr. Vice President - 2002 250,000 - 0 - 75,000 31,000 6,846
Delivery, Idaho Power 2001 210,000 168,000 63,000 30,000 - 0 -
Robert W. Stahman............ 2003 200,000 - 0 - 50,000 9,000 7,999
Vice President, General 2002 200,000 - 0 - 50,000 6,000 8,000
Counsel and Secretary, 2001 180,000 108,000 45,000 4,000 6,800
IDACORP and Idaho Power
Darrel T. Anderson........... 2003 185,000 - 0 - 55,500 35,000 7,186
Vice President, Chief 2002 185,000 - 0 - 55,500 7,000 7,846
Financial Officer & 2001 155,000 93,000 38,750 4,000 5,305
Treasurer, IDACORP and
Idaho Power
A. Bryan Kearney............. 2003 183,000 - 0 - 45,750 9,000 7,320
Vice President & Chief 2002 183,000 - 0 - 45,750 6,000 7,199
Information Officer, 2001 165,000 99,000 41,250 4,000 6,365
IDACORP and
Idaho Power
- --------------
(1) The aggregate restricted stock holdings as of December 31, 2003 are as
follows: Mr. Packwood held 16,743 ($500,950) shares of restricted stock;
Mr. Keen held 8,649 ($258,778) shares of restricted stock; Mr. Miller held
5,648 ($168,988) shares of restricted stock; Mr. Stahman held 4,163
($124,556) shares of restricted stock; Mr. Anderson held 4,392 ($131,408)
shares of restricted stock; Mr. Kearney held 3,811 ($114,025) shares of
restricted stock. Dividends are paid on restricted stock when and as paid
on the IDACORP Common Stock.
(2) Represents the Company's contribution to the Employee Savings Plan (401-k
plan).
21
OPTION / SAR GRANTS IN FISCAL YEAR 2003
Number of % of Total
Securities Options/SARs
Underlying Granted to Exercise or Grant
Options / SARs Employees in Base Price Date Value
Name Granted (1)# Fiscal 2003 ($/Share) Expiration Date ($) (2)
- ----- -------------- ------------- ----------- --------------- ----------
Jan B. Packwood............. 136,000 31.7% $22.92 March 20, 2013 $524,960
J. LaMont Keen.............. 65,000 15.1% $22.92 March 20, 2013 250,900
James C. Miller............. 20,000 4.6% $22.92 March 20, 2013 77,200
Robert W. Stahman........... 9,000 2.0% $22.92 March 20, 2013 34,740
Darrel T. Anderson.......... 35,000 8.1% $22.92 March 20, 2013 135,100
A. Bryan Kearney............ 9,000 2.0% $22.92 March 20, 2013 34,740
- --------------
(1) Options were granted pursuant to the 2000 Long-Term Incentive and
Compensation Plan. The options vest 20% per year and accelerate upon a
change in control.
(2) The grant date values were calculated on the basis of the Binomial
option-pricing model. Options were assumed to be exercised 7 years after
the date of grant. A risk-free interest rate of 3.95%, stock price
volatility of 28% and a dividend yield of 8.12% were used in the
calculation of the option grants. The actual value of the options will
depend on the market value of the Company's Common Stock on the dates the
options are exercised. No realization of value from the options is possible
without an increase in the price of the Company's Common Stock, which would
benefit all shareholders commensurately.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUES
Number of
Shares securities underlying Value of unexercised,
acquired Value unexercised options in-the-money options
on exercise realized at fiscal year-end(1) at fiscal year-end
(#) ($) (#) ($)
----------- -------- ------------------------- ---------------------------
Exercisable Unexercisable Exercisable Unexercisable
----------- ------------- ----------- -------------
Jan B. Packwood.......... - 0 - - 0 - 102,200 284,800 - 0 - 952,000
J. LaMont Keen........... - 0 - - 0 - 44,800 134,200 - 0 - 455,000
James C. Miller.......... - 0 - - 0 - 42,200 78,800 - 0 - 140,000
Robert W. Stahman........ - 0 - - 0 - 2,800 16,200 - 0 - 63,000
Darrel T. Anderson....... - 0 - - 0 - 3,000 43,000 - 0 - 245,000
A. Bryan Kearney......... - 0 - - 0 - 2,800 16,200 - 0 - 63,000
- --------------
(1) Vesting is accelerated upon a change in control.
22
DIRECTOR COMPENSATION
During 2003, each Director who was not an employee of IDACORP or Idaho
Power received $1,000 for each Board meeting and for each committee meeting
attended. Non-employee Directors who are chairmen of Board committees received
$1,840 per month (this monthly amount increases in 2004 to $2,295 for the
Chairmen of the Audit and Compensation Committees and $1,962 per month for the
Chairman of the Corporate Governance Committee); other non-employee Directors
received $1,670 per month. In addition, each non-employee Director including the
non-executive Chairman received an annual stock grant under the Director Stock
Program of IDACORP common stock equal to approximately $16,000, or 605 shares,
in July of 2003. A grant of 3,000 stock options under the IDACORP 2000 Long-Term
Incentive and Compensation Plan scheduled for January of 2003 to vest ratably
over five years was inadvertently not made and instead was replaced in March of
2004 with a grant under the Plan of 750 shares of restricted stock and 2,250
stock options both vesting ratably over five years commencing on April 1, 2004.
The Directors received a regularly scheduled grant under the Plan of 3,000 stock
options in January of 2004 vesting ratably over five years. Mr. Miller, as
non-executive Chairman of the Board of IDACORP and Idaho Power, received a
monthly retainer of $6,000 (this monthly amount increases to $6,500 in 2004).
Mr. Miller does not receive meeting fees for either Board or committee meetings.
Directors may defer all or a portion of any retainers and meeting fees under a
deferred compensation plan. Under the plan, at retirement Directors may elect to
receive one lump-sum payment of all amounts deferred with interest (the interest
rate is equal to the Moody's Long-term Corporate Bond Yield Average rate, plus
three (3) percent), or a series of up to 10 equal annual payments, depending
upon the specific deferral arrangement. A special account is maintained on the
books showing the amounts deferred and the interest accrued thereon.
Since each director serves on both the IDACORP and Idaho Power Boards and
on the same committees of each Board, the monthly retainer applies to service on
both Boards, as do the meeting fees for the Board meetings and for each
committee which has a corresponding committee at both companies. The practice
generally is that meetings of the IDACORP and Idaho Power Boards and the
corresponding committees are held in conjunction with each other and a single
meeting fee is paid to each director for each set of meetings. Separate meeting
fees will be paid in the event a Board or committee meeting is not held in
conjunction with a meeting of the corresponding Board or committee and for those
committee meetings which do not have a corresponding committee.
EMPLOYMENT CONTRACTS AND
CHANGE OF CONTROL AGREEMENTS
Neither IDACORP nor Idaho Power has an employment contract with any
executive officer.
IDACORP has entered into Change of Control Agreements with the Named
Officers which become effective for a three-year period upon a change of control
of IDACORP. If a change of control occurs, the Agreements provide that specified
payments and benefits would be paid in the event of termination of the
Executive's employment (i) by IDACORP, other than for cause, death or
disability, or (ii) by the Executive for constructive discharge or retirement,
at any time when the Agreements are in effect. In such event, each of the Named
Officers would receive payment of an amount equal to two and one-half times his
annual compensation, which shall be the highest combined amount of base salary
and bonus received by the Named Officer in any one of the five years preceding
termination. In addition, under these Agreements, each of the Named Officers
would receive (i) the immediate vesting of restricted stock granted prior to the
change in control; (ii) outplacement services for 12 months not to exceed
$12,000; and (iii) all benefits for a period of 24 months under the welfare
benefit plans.
For these purposes "cause" means the Executive's fraud or dishonesty which
has resulted or is likely to result in material economic damage to IDACORP or a
subsidiary of IDACORP, as determined in good faith by a vote of at least
two-thirds of the non-employee directors of IDACORP at a meeting of the Board at
which the Executive is provided an opportunity to be heard. "Constructive
discharge" includes material failure by IDACORP to comply with the Agreement,
relocation, and certain reduction in compensation.
23
A "change of control" is defined as (i) the acquisition by a party or
certain related parties of 20% or more of IDACORP's voting securities; (ii) a
purchase by a person of 20% or more of the outstanding stock pursuant to a
tender or exchange offer; (iii) shareholder approval of a merger or similar
transaction after which IDACORP's shareholders will hold 50% or less of the
voting securities of the surviving entity or (iv) a change in a majority of the
Board of Directors within a 24-month period without the approval of two-thirds
of the members of the Board.
PERFORMANCE GRAPH
Source: Bloomberg and Edison Electric Institute
Comparison of Cumulative Total Return
$100 Invested December 31, 1998
[Graph Omitted]
The table shows a Comparison of Five-Year Cumulative Total Shareholder
Return for IDACORP 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, 1998, with beginning-of-period weighting of the peer
group indices (based on market capitalization) and monthly compounding of
returns.
EEI 100
IDACORP S&P 500 Electric Utilities
------- ------- ------------------
1998 $100.00 $100.00 $100.00
1999 78.59 121.04 81.40
2000 150.86 110.03 120.45
2001 131.05 96.95 109.86
2002 85.20 75.54 93.68
2003 109.79 97.19 115.67
24
RETIREMENT BENEFITS
The following table sets forth the estimated annual retirement benefits
payable under the Idaho Power Retirement Plan (a qualified defined benefit
pension plan for all regular employees) and under the Idaho Power Security Plan
for Senior Management Employees (a non-qualified defined benefit plan for senior
management employees). The plans cover employees of IDACORP and Idaho Power.
PENSION PLAN TABLE
REMUNERATION YEARS OF SERVICE
- -------------- -----------------------------------------------------
10 15 20 25 30 35
$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
$550,000 $330,000 $357,500 $385,000 $412,500 $412,500 $412,500
$600,000 $360,000 $390,000 $420,000 $450,000 $450,000 $450,000
$650,000 $390,000 $422,500 $455,000 $487,500 $487,500 $487,500
$700,000 $420,000 $455,000 $490,000 $525,000 $525,000 $525,000
Benefits under the Retirement Plan for Executive management 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. Idaho Power
has established a trust which is made up of trust-owned life insurance, stocks
and fixed income securities, the value of which is sufficient to cover the
liabilities of the Security Plan. Effective August 1, 1996, Idaho Power
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, 2003, 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. Packwood, $662,654; Mr. Keen,
$386,219; Mr. Miller, $270,465; Mr. Stahman, $229,800; Mr. Anderson, $191,846;
and Mr. Kearney, $208,125. Years of credited service under the Retirement Plan
and years of participation as a senior management employee are, respectively:
Mr. Packwood, 34, 27; Mr. Keen, 30, 21; Mr. Miller 27, 16; Mr. Stahman 26, 21;
Mr. Anderson 7, 8; and Mr. Kearney 4, 4.
25
ANNUAL REPORT
The IDACORP 2003 annual report to shareholders, which includes the combined
Annual Report on Form 10-K for the year ended December 31, 2003 of IDACORP and
Idaho Power, was mailed along with this Joint Proxy Statement on or about April
12, 2004 to all shareholders of record.
IDACORP and Idaho Power hereby undertake to deliver promptly, upon written
or oral request, a separate copy of the annual report to shareholders, or proxy
statement, as applicable, to a shareholder at a shared address to which a single
copy of the document was delivered. Requests should be addressed to Shareowner
Services, 1221 West Idaho Street, Boise, Idaho 83702, telephone 1-800-635-5406.
2005 JOINT 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 IDACORP or Idaho Power, as the case may be, not later than 120 days prior to
the first anniversary of the date on which the Company first mailed its proxy
materials for the preceding year's annual meeting. The notice must contain
certain information specified in the Bylaws, a copy of which may be obtained by
writing to the Corporate Secretary.
Rule 14a-4 of the Securities and Exchange Commission's proxy rules allows a
company to use discretionary voting authority to vote on matters coming before
an annual meeting of shareholders, if the company does not have notice of the
matter at least 45 days before the date corresponding to the date on which the
company first mailed its proxy materials for prior year's annual meeting of
shareholders or the date specified by an advance notice provision in the
company's bylaws. The Bylaws of IDACORP and Idaho Power contain such an advance
notice provision. Under the Bylaws, 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 IDACORP or Idaho Power, as the case may be, not later than 120
days prior to the first anniversary of the date on which the company first
mailed its proxy materials for the preceding year's annual meeting. The notice
must contain certain information specified in the Bylaws, a copy of which may be
obtained by writing to the Corporate Secretary.
For the 2005 Joint Annual Meeting of Shareholders, expected to be held on
May 19, 2005, IDACORP and Idaho Power shareholders must submit such nominations
or proposals to the Secretary of IDACORP or Idaho Power, as the case may be, no
later than December 13, 2004.
The requirements referred to above are separate and apart from the
Securities and Exchange Commission's requirements that a shareholder must meet
in order to have a shareholder proposal included in the proxy statement under
Rule 14a-8. For the 2005 Joint Annual Meeting of Shareholders expected to be
held on May 19, 2005, any shareholder who wishes to submit a proposal for
inclusion in the joint proxy materials pursuant to Rule 14a-8 must submit such
proposal to the Secretary of IDACORP or Idaho Power, as the case may be, on or
before December 13, 2004.
It is requested that each shareholder who cannot attend the meeting vote
his or her proxy or proxies without delay.
26
EXHIBIT "A"
CHARTER OF THE
AUDIT COMMITTEE
OF THE BOARD OF DIRECTORS OF IDACORP, INC.
ADOPTED AS OF JULY 17, 2003
AND AMENDED AS OF NOVEMBER 20, 2003
I. PURPOSE OF THE COMMITTEE
The purpose of the Audit Committee (the "Committee") of the Board of
Directors (the "Board") of IDACORP, Inc. (the "Company") shall be to assist the
Board in the oversight of the integrity of the Company's financial statements;
compliance with legal and regulatory requirements; the qualifications,
independence and performance of the independent auditors; and the performance of
the internal audit function. The Committee shall also prepare the Audit
Committee report as required by the Securities and Exchange Commission ("SEC")
to be included in the Company's proxy statement for the annual meeting of
shareholders. The Committee shall report regularly to the Board.
II. COMPOSITION OF THE COMMITTEE
The Committee shall be comprised of no fewer than three Directors. The
Directors on the Committee shall meet the independence and other requirements of
the New York Stock Exchange ("NYSE"), the Sarbanes-Oxley Act of 2002 ("SOX Act")
and the rules promulgated by the SEC pursuant to the SOX Act and the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). Each Director meeting
these requirements shall be referred to as an "Independent Director." Each
member of the Committee must be "financially literate," as such qualification is
interpreted by the Board in its business judgment, or must become financially
literate within a reasonable period of time after his or her appointment to the
Committee. In addition, at least one member of the Committee must have
"accounting or related financial management expertise," as the Board interprets
such qualification in its business judgment. One member of the Committee shall
be an "audit committee financial expert" as that term is defined in the rules
and regulations promulgated by the SEC pursuant to the SOX Act. No Director may
serve as a member of the Committee if such Director serves on the audit
committees of more than two other public companies, unless the Board expressly
determines that such service would not impair said Director's ability to serve
effectively on the Committee and such determination is disclosed in the
Company's annual proxy statement.
The members of the Committee shall be appointed annually to one year terms
by majority vote of the Board at the first meeting of the Board following the
annual meeting of shareholders. Vacancies on the Committee shall be filled by
majority vote of the Board at the next meeting of the Board following the
occurrence of the vacancy or by unanimous written consent of the Board. No
member of the Committee shall be removed from the Committee except by majority
vote of the Independent Directors then in office or by unanimous written consent
of the Board.
III. MEETINGS AND PROCEDURES OF THE COMMITTEE
The Committee shall fix its own rules of procedure, which shall be
consistent with the By-laws of the Company and this Charter. The Committee shall
meet as provided by its rules, which shall be at least five times annually or
more frequently as circumstances require. The Board shall designate one member
of the Committee as its Chairperson on an annual basis. The Chairperson of the
Committee or a majority of the members of the Committee may also call a special
meeting of the Committee. A majority of the members of the Committee present in
person or by means of a conference telephone or other communications equipment
by means of which all persons participating in the meeting can hear each
A-1
other shall constitute a quorum. The Committee shall act on the affirmative vote
of a majority of members present at a meeting at which a quorum is present.
Without a meeting, the Committee may act by unanimous written consent of all
members.
The Committee may request that any Director, officer or employee of the
Company, or other person whose advice and counsel is sought by the Committee,
attend any meeting of the Committee to provide such pertinent information as the
Committee requests.
Following each of its meetings, the Committee shall deliver a report on the
meeting to the Board, including a description of all actions taken by the
Committee at the meeting. The Committee shall keep written minutes of its
meetings, which minutes shall be maintained with the books and records of the
Company.
The Committee may delegate certain of its functions to one or more members
of the Committee if permitted by law. Such member(s) shall report on all actions
taken no later than at the next meeting of the Committee. The Committee's
functions are the sole responsibility of the Committee and may not be allocated
to a different committee.
IV. DUTIES OF THE COMMITTEE
The Committee shall have the following duties and responsibilities:
A. Financial Reporting
1. The Committee shall review and discuss with management, the Company's
independent auditors and the director of internal audit the following:
(a) the Company's earnings press releases (with particular attention
to any use of "pro forma," or "adjusted" non-GAAP, information),
as well as financial information and earnings guidance provided
by the Company to analysts and rating agencies. This discussion
may be done generally (i.e., discussion of the types of
information to be disclosed and the type of presentation to be
made).
(b) the Company's annual audited financial statements and quarterly
financial statements, including the disclosures under
"Management's Discussion and Analysis of Financial Condition and
Results of Operations," and any major issues related thereto, and
recommend to the Board whether the audited financial statements
should be included in the Company's Annual Report on Form 10-K.
(c) the critical accounting policies and such other accounting
policies of the Company as are deemed appropriate for review by
the Committee prior to any interim or year-end filings with the
SEC or other regulatory body, including any financial reporting
issues which could have a material impact on the Company's
financial statements.
(d) the development, selection and disclosure of critical accounting
estimates included in the "Management's Discussion and Analysis
of Financial Condition and Results of Operations."
(e) any major issues regarding accounting principles and financial
statement presentations, including any significant changes in the
selection or application of accounting principles.
(f) any analyses prepared by management and/or the independent
auditors setting forth significant financial reporting issues and
judgments made in connection with the preparation of the
financial statements.
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(g) all alternative treatments of financial information within GAAP
that have been discussed by the independent auditors and
management, ramifications of the use of such alternatives and the
treatment preferred by the independent auditors.
(h) all material written communications between the independent
auditors and management including but not limited to any
management letter, schedule of unadjusted differences or
management representation letter.
(i) the effect of regulatory, tax, accounting and financial reporting
initiatives or developments, as well as off-balance sheet
structures, on the financial statements of the Company, including
those proposed and/or adopted by the Financial Accounting
Standards Board, the Public Company Accounting Oversight Board,
the American Institute of Certified Public Accountants or the
Internal Revenue Service that may have a bearing on the Company.
(j) the Chief Executive Officer and Chief Financial Officer periodic
report certifications and disclosure required under the SOX Act
and the rules promulgated by the SEC pursuant thereto.
2. The Committee shall meet periodically with the Disclosure Committee to
discuss any matters of concern arising from the Disclosure Committee's
quarterly process to assist the Chief Executive Officer and Chief
Financial Officer in their SOX Act Section 302 and 906 certifications.
3. The Committee shall prepare the Audit Committee Report, as required by
Item 306 of Regulation S-K for inclusion in the Company's annual proxy
statement.
4. The Committee shall review with the full Board any issues that arise
with respect to the quality or integrity of the Company's financial
statements.
B. Independent Auditors
1. The Committee shall be directly responsible for the appointment
(subject to shareholder ratification), compensation, retention, and
oversight of the work of any independent auditors engaged by the
Company (including resolution of disagreements between management and
the auditor regarding financial reporting) for the purpose of
preparing or issuing an audit report or related work or performing
other audit, review or attest services for the Company, and each
independent auditor shall report directly to the Committee.
2. The Committee shall review and have sole authority to approve the
independent auditors' engagement plan, including the audit plan,
scope, procedures and the engagement letter, including the proposed
fees and terms contained therein, and monitor such plan's progress and
results during the year.
3. The Committee shall review and have sole authority to pre-approve all
audit and, as provided in the SOX Act, all permitted non-audit
engagements between the Company and the independent auditors and
monitor such engagements' progress and results during the year.
(a) The Committee may establish pre-approval policies and procedures
for the engagement of the independent auditors.
(b) The Committee may delegate to one or more designated members the
authority to grant the pre-approvals required by this subsection.
The decisions of any member to whom authority is delegated to
pre-approve an activity shall be presented to the full Committee
at the next meeting of the Committee to occur after the grant of
such approval.
(c) The Committee shall request from the independent auditors written
assurance that each non-audit service they are to provide to the
Company is not a prohibited activity as described in Section
10A(g) of the Exchange Act or Rule 2-01(c)(4) of Regulation S-X.
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4. The Committee shall obtain and review at least annually a report from
the independent auditors describing:
(a) the independent auditors' internal quality-control procedures.
(b) any material issues raised by the most recent internal quality
control review, or peer review, of the independent auditors, or
by any inquiry or investigation by any governmental or
professional authority, within the preceding five years,
respecting independent audits carried out by the independent
auditors, and any steps taken to deal with any such issues.
(c) all relationships between the independent auditors and the
Company, including a description of each category of services
provided by the independent auditors to the Company and a list of
the fees billed for each such category.
5. The Committee shall evaluate annually the independent auditors'
qualifications, performance and independence. In this evaluation, the
Committee shall take into account the opinions of management and the
internal auditors. The Committee shall review and evaluate the lead
partner of the independent auditors. The Committee shall present its
conclusions to the Board.
6. The Committee shall oversee the independence of the independent
auditors by, among other things:
(a) actively engaging in a dialogue with the independent auditors
with respect to any disclosed relationships or services that may
affect the objectivity and independence of the independent
auditors, and taking appropriate action to satisfy itself of the
auditors' independence.
(b) monitoring the rotation of audit partners to ensure that the
independent auditors are considered independent under applicable
rules and regulations.
(c) setting clear hiring policies for employees or former employees
of the independent auditors to ensure that the independent
auditors are considered independent under applicable rules and
regulations.
(d) considering whether there should be a regular rotation of the
independent auditors.
(e) monitoring whether any improper influence is being asserted on
the independent auditors engaged in the performance of the audit
by officers or Directors of the Company, or any person acting
under their direction.
7. The Committee shall instruct the independent auditors that they are
ultimately accountable to the Committee and the Board.
8. The Committee shall review and discuss on a regular basis with the
independent auditors the matters required to be discussed by Statement
on Auditing Standards No. 61 relating to the conduct of the audit,
including any problems or difficulties the independent auditors
encountered in the course of any audit work, and management's response
with respect thereto, any restrictions on the scope of the independent
auditors' activities or on access to requested information, and any
significant disagreements with management. In connection therewith,
the Committee should review with the independent auditors the
following:
(a) any accounting adjustments that were noted or proposed by the
independent auditors but were rejected by management (as
immaterial or otherwise).
(b) any communications between the audit team and the independent
auditors' national office regarding auditing or accounting issues
presented by the engagement.
A-4
(c) any "management" or "internal control" letters issued, or
proposed to be issued, by the independent auditors.
9. The Committee shall obtain from the independent auditors their annual
report and any other information pursuant to Section 10A of the
Exchange Act.
10. The Committee shall review with the full Board any issues that arise
with respect to the performance and independence of the independent
auditors.
C. Internal Controls
1. The Committee shall review with the independent auditors, corporate
compliance, internal audit and risk management, the adequacy and
effectiveness of the Company's internal controls pertaining to (i) the
effectiveness and efficiency of operations, (ii) reliability of
financial reporting and (iii) compliance with applicable law and
regulations. The Committee's review of the Company's internal controls
shall include, beginning with the Company's fiscal year ending
December 31, 2004, a review of management's annual report on the
Company's internal control over financial reporting, as well as the
independent auditors' attestation report on management's assessment of
the Company's internal control over financial reporting included in
management's report, prior to the inclusion of such reports in the
Company's annual report.
2. The Committee shall review with management the Company's internal
controls, including major issues as to the adequacy of the Company's
internal controls and any special audit steps adopted in light of the
discovery of material control deficiencies, and evaluate whether the
Company is operating in accordance with its prescribed policies,
procedures and codes of conduct.
3. The Committee shall review periodically with the Chief Executive
Officer, Chief Financial Officer, the independent auditors and the
internal auditor, the following:
(a) all significant deficiencies and material weaknesses in the
design or operation of the Company's internal control over
financial reporting which are reasonably likely to adversely
affect the Company's ability to record, process, summarize and
report financial information.
(b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the Company's
internal control over financial reporting.
(c) any change in the Company's internal control over financial
reporting that has materially affected, or is reasonably likely
to materially affect, the Company's internal control over
financial reporting.
D. Legal and Regulatory Compliance
The Committee shall:
(a) review with the full Board any issues that arise with respect to
the Company's compliance with legal or regulatory requirements.
(b) review with the Company's General Counsel material litigation and
other legal matters as appropriate.
A-5
E. Risk Management
The Committee shall:
(a) review and discuss with management guidelines and policies to
govern the process by which management assesses and manages the
Company's exposure to risk, as well as the Company's major
financial risk exposures and the steps management has taken to
monitor and control such risk.
(b) review and concur in the appointment or removal of the Chief Risk
Officer.
F. Internal Audit
1. The Committee shall:
(a) annually review the Company's Internal Audit Department function
including its organization and qualifications, the proposed audit
plan for the coming year, the Internal Audit Department's
coordination efforts with the independent auditors, significant
findings during the year, any difficulties experienced including
access restrictions, changes in the audit plan and the
independence of internal audit.
(b) review and concur in the appointment or removal of the director
of internal audit.
2. The Committee shall review with the full Board any issues that arise
with respect to the performance of the internal audit function.
3. The Committee shall discuss with the independent auditor the
responsibilities, budget and staffing of the Company's internal audit
function.
G. Other Duties and Responsibilities
The Committee shall:
(a) provide for an open avenue of communications between and among
the Board, the Committee, the internal auditors and the
independent auditors, including periodic meetings with the
director of internal audit, the independent auditors, the Chief
Financial Officer and other members of management in separate
executive sessions to discuss any matters that the Committee,
these groups or individuals believe should be discussed privately
with the Committee.
(b) establish procedures for (i) the receipt, retention and treatment
of complaints received by the Company regarding accounting,
internal accounting controls or auditing matters and (ii) the
confidential, anonymous submission by employees of the Company of
concerns regarding questionable accounting or auditing matters.
(c) perform such other functions as assigned to the Committee by law,
the Company's Charter or By-laws, or the Board.
(d) periodically review with the Chief Executive Officer, the Chief
Financial Officer, the Disclosure Committee, and the internal
auditor, the adequacy and effectiveness of the Company's
disclosure controls and procedures.
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H. Funding
Appropriate funding, as determined by the Committee, shall be provided by
the Company for payment of compensation to the independent auditors employed by
the Company for the purposes of preparing or issuing an audit report or
performing other audit, review or attest services for the Company, and for
ordinary administrative expenses of the Committee that are necessary or
appropriate in carrying out its duties.
V. EVALUATION OF THE COMMITTEE
The Committee shall, on an annual basis, evaluate its performance under
this Charter. In conducting this review, the Committee shall evaluate whether
this Charter appropriately addresses the matters that are or should be within
its scope. The Committee shall address all matters that the Committee considers
relevant to its performance including but not limited to the following: the
adequacy, appropriateness and quality of the information and recommendations
presented by the Committee to the Board, the manner in which they were discussed
or debated, and whether the number and length of meetings of the Committee were
adequate for the Committee to complete its work in a thorough and thoughtful
manner.
The Committee shall report to the Board the results of its evaluation,
including any recommended amendment to this Charter and any recommended change
to the Company's or the Board's policies or procedures.
VI. INVESTIGATIONS AND STUDIES; OUTSIDE ADVISORS
The Committee may conduct or authorize investigations into or studies of
matters within the Committee's scope of responsibilities, and may engage and
obtain the advice and assistance from outside legal, accounting or other
advisors as the Committee deems necessary to carry out its duties. The Committee
may retain and compensate these advisors without seeking Board approval.
Appropriate funding, as determined by the Committee, shall be provided by the
Company for payment of compensation to any outside legal, accounting or other
advisors employed by the Committee.
VII. GENERAL
While the Committee has the duties and responsibilities set forth in this
Charter, the Committee is not responsible for planning or conducting the audit
or for determining whether the Company's financial statements are complete and
accurate and in accordance with generally accepted accounting principles.
In fulfilling their responsibilities hereunder, it is recognized that
members of the Committee are not full-time employees of the Company and that it
is not the duty or responsibility of the Committee or its members to conduct
"field work" or other types of auditing or accounting reviews or procedures or
to set auditor independence standards. Each member of the Committee shall be
entitled to rely on (i) the integrity of those persons and organizations within
and outside the Company from which it receives information, (ii) the accuracy of
the financial and other information provided to the Committee absent actual
knowledge to the contrary (which shall be promptly reported to the Board) and
(iii) statements made by management or third parties as to any information
technology, internal audit and other non-audit services provided by the
independent auditors to the Company.
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EXHIBIT "B"
IDACORP, Inc. / Idaho Power Company
Audit Committee
Policy For Pre-Approval of Independent Auditor Services
Adopted February 4, 2004
BACKGROUND:
- -----------
The Sarbanes-Oxley Act of 2002, Section 10A(i) of the Securities Exchange
Act of 1934, as amended, Regulation S-X Section 2-01(c) (7) and the Company's
Audit Committee Charter require the Audit Committee to pre-approve all audit and
permitted non-audit services provided to the Company by the independent auditor.
In order to comply with these requirements, and to ensure both the
appearance and certainty of independence on behalf of the independent auditors,
the Audit Committee hereby establishes the following policies:
POLICY:
- -------
I. STATEMENT OF PRINCIPLES
In addition to the audits of the Company's consolidated financial
statements, the independent auditor may be engaged to provide Audit-Related
Services, Tax Services and All Other Services. The Audit Committee is required
to pre-approve all services performed by the independent auditor in order to
assure that the provision of such services does not impair the auditor's
independence. Unless a type of service to be provided by the independent auditor
has received general pre-approval, it will require specific pre-approval by the
Audit Committee. Any proposed services exceeding pre-approved cost levels will
require specific pre-approval by the Audit Committee.
Any request to engage the independent auditor to provide a service which
has not received general pre-approval shall be submitted as a written proposal
to the Chief Financial Officer (CFO) with a copy to the General Counsel. Such
request shall include a detailed description of the service to be provided, the
proposed fee and the business reasons for engaging the independent auditor to
provide the service. Upon approval by the CFO, the General Counsel and the
independent auditor that the proposed engagement complies with the terms of this
Policy and the applicable rules and regulations, the request shall be presented
to the Committee or the Committee Chairman, as the case may be, for
pre-approval.
In determining whether to pre-approve the engagement of the independent
auditor, the Committee or the Committee Chairman, as the case may be, shall
consider, among other things, this Policy, applicable rules and regulations and
whether the nature of the engagement and the related fees are consistent with
the following principles, as stated in the SEC's adopting release for the rules
on auditor independence:
o the independent auditor cannot function in the role of management of
the Company;
o the independent auditor cannot audit its own work;
o the independent auditor cannot serve in an advocacy role on behalf of
the Company.
The appendices to this Policy describe the Audit, Audit-Related, Tax and
All Other Services that have the general pre-approval of the Audit Committee.
The term of any pre-approval is 12 months from the date of pre-approval, unless
the Audit Committee specifically provides for a different period. The Audit
Committee will periodically revise the list of pre-approved services, based on
subsequent determinations.
B-1
II. DELEGATION
The Audit Committee may delegate pre-approval authority to one or more of
its members. The Audit Committee hereby delegates to the Chairman of the
Committee pre-approval authority for proposed audit and audit-related services.
The Chairman shall report any pre-approval decisions to the Audit Committee at
its next scheduled meeting.
III. DEFINITIONS
Audit Services: those services which only the independent auditor can
reasonably provide, including tax services and accounting consultation necessary
to perform an audit of the consolidated financial statements of the Company;
services in connection with statutory and regulatory filings or engagements;
statutory audits or financial audits for subsidiaries or affiliates; attest
services, including attestation of management's report on internal controls;
services associated with registration statements, periodic reports and other
documents filed with or furnished to the Securities and Exchange Commission,
including comfort letters, consents and assistance in responding to SEC comment
letters; and consultations by the Company as to the accounting or disclosure
treatment of transactions or events and/or the actual or potential impact of
final or proposed rules, standards or interpretations by the SEC, FASB, or other
regulatory or standard setting bodies (other than services which are
Audit-Related Services and have been separately pre-approved).
Audit-Related Services: assurances and related services that are reasonably
related to the performance of the audit or review of the Company's financial
statements and that are traditionally performed by the independent auditor
including employee benefit plan audits; due diligence related to mergers,
acquisitions or dispositions; accounting consultations and audits in connection
with acquisitions or dispositions; internal control reviews and assistance with
internal control reporting requirements; attest services related to financial
reporting that are not required by statute or regulation; consultations
concerning financial accounting and reporting standards and consultations by the
Company's management as to the accounting or disclosure treatment of
transactions or events and/or the actual or potential impact of final or
proposed rules, standards or interpretations by the SEC, FASB, or other
regulatory or standard setting bodies (other than services that are Audit
Services and have been separately pre-approved); statutory, subsidiary or equity
investee audits incremental to the audit of the consolidated financial
statements; general assistance with the implementation of the requirements of
Sarbanes-Oxley, SEC rules and NYSE listing standards; and agreed-upon or
expanded audit procedures relating to accounting and/or billing records required
to respond to or comply with financial, accounting or regulatory reporting
matters.
Tax Services: tax compliance (preparation of original and amended tax
returns, claims for refund and tax payment planning services); other tax advice
(assistance with tax audits and appeals, tax advice related to mergers and
acquisitions, employee benefit plans and requests for rulings or technical
advice from taxing authorities); tax planning.
All Other Services: any other work that is not an Audit Service,
Audit-Related Service or a Tax Service.
IV. AUDIT SERVICES
The annual Audit Services engagement terms and fees will be subject to the
specific pre-approval of the Audit Committee. The Audit Committee will approve,
if necessary, any changes in terms, conditions and fees resulting from changes
in audit scope, Company structure or other matters.
In addition to the annual Audit Services engagement approved by the Audit
Committee, the Audit Committee may grant pre-approval for other Audit Services.
The Audit Committee has pre-approved the Audit Services listed in Appendix A.
All Audit Services not listed in Appendix A must be separately pre-approved by
the Audit Committee.
B-2
V. AUDIT-RELATED SERVICES
The Audit Committee believes that the provision of Audit-Related Services
does not impair the independence of the auditor and has pre- approved the
Audit-Related Services listed in Appendix B. All Audit-Related Services not
listed in Appendix B must be separately pre-approved by the Audit Committee.
VI. TAX SERVICES
The Audit Committee believes that the independent auditor can provide
certain Tax Services to the Company without impairing the auditor's
independence. The Audit Committee has pre-approved the Tax Services listed in
Appendix C. All Tax Services not listed in Appendix C must be separately
pre-approved by the Audit Committee.
VII. ALL OTHER SERVICES
The Audit Committee may grant pre-approval to those permissible non-audit
services classified as All Other Services that it believes are routine and
recurring services and would not impair the independence of the auditor. The
Audit Committee has pre-approved the All Other Services listed in Appendix D.
Permissible All Other Services not listed in Appendix D must be separately
pre-approved by the Audit Committee.
A list of the SEC's prohibited non-audit services is attached to this
policy as Exhibit I. The SEC's rules and relevant guidance should be consulted
to determine the precise definitions of these services and the applicability of
exceptions to certain of the prohibitions.
VIII. FEE LEVEL REVIEW
A fee level review for all services to be provided by the independent
auditor will be periodically performed by the Audit Committee.
IX. SUPPORTING DOCUMENTATION
With respect to each proposed service, the independent auditor will
provide detailed back-up documentation regarding the specific services to be
provided. This documentation will be provided to the Audit Committee,
X. PROCEDURES
Requests or applications to provide services that require separate
approval by the Audit Committee will be submitted to the Audit Committee by the
independent auditor, the Chief Financial Officer and the General Counsel, and
must include a joint statement as to whether, in their view, the request or
application is consistent with the SEC's rules on auditor independence.
B-3
EXHIBIT I
Prohibited Non-Audit Services
-----------------------------
o Bookkeeping or other services related to the accounting records or
financial statements of the Company
o Financial information systems design and implementation
o Appraisal or valuation services, fairness opinions or
contribution-in-kind reports
o Actuarial services
o Internal audit outsourcing services
o Management functions
o Human resources
o Broker-dealer, investment adviser or investment banking services
o Legal services
o Expert services unrelated to the audit
[LOGO] IDACORP Annual Meeting of Shareholders
Thursday, May 20, 2004
10:00 a.m. Local Time
Idaho Power Corporate Headquarters
1221 West Idaho Street
Boise, Idaho 83707
- --------------------------------------------------------------------------------
THERE ARE THREE WAYS TO VOTE YOUR PROXY
TELEPHONE VOTING INTERNET VOTING VOTING BY MAIL
This method of voting is available Visit the Internet voting website Simply mark, sign and date
for residents of the U.S. and Canada. at http://proxy.georgeson.com. your proxy card and return
On a touch tone telephone, call TOLL Have your proxy card ready and it in the postage-paid
FREE 1-800-858-0073, 24 hours a day, follow the instructions on your envelope. If you are
7 days a week. Have your proxy card screen. You will incur only your voting by telephone or the
ready, then follow the prerecorded usual Internet charges. Available Internet, please do not
instructions. Your vote will be until 5:00 pm Eastern Time on May mail your proxy card.
confirmed and cast as you directed. 19, 2004.
Available until 5:00 pm Eastern Time
on May 19, 2004.
TO VOTE BY MAIL, PLEASE DETACH PROXY CARD HERE
- --------------------------------------------------------------------------------
/X/ Please mark votes
as in this example.
- --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSALS 1 AND 2
- --------------------------------------------------------------------------------
1. ELECTION OF DIRECTORS: Nominees: FOR all nominees WITHHOLD
01 Rotchford L Barker listed (except as authority to
02 Jon H. Miller indicated to vote for
03 Robert A. Tinstman the contrary) all nominees
|_| |_|
INSTRUCTIONS: To withhold authority
to vote for any individual nominee(s),
write the name(s) of such nominee(s)
in the space provided below.
-------------------------------------
2. To ratify the selection of FOR AGAINST ABSTAIN
Deloitte & Touche LLP as |_| |_| |_|
independent auditor for the
fiscal year ending December 31,
2004
- --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" PROPOSAL 3
- --------------------------------------------------------------------------------
3. To act upon a shareholder proposal FOR AGAINST ABSTAIN
requesting IDACORP to publish |_| |_| |_|
annually in the Proxy Statement
an explanation of Board procedures
governing donations to and a list
of Board approved private
foundations.
DATE:
--------------------
----------------------------
----------------------------
Signature(s) in Box
----------------------------
----------------------------
Signature of Joint Owner
[LOGO] IDACORP
April 12, 2004
Dear Shareholders of IDACORP:
It is our pleasure to invite you to attend the upcoming 2004 joint Annual
Meeting of Shareholders of IDACORP, Inc. and Idaho Power Company to be held on
May 20, 2004, at 10:00 A.M., local time, at the Idaho Power Corporate
Headquarters, 1221 West Idaho Street, Boise, Idaho. Your Board of Directors and
management look forward to personally greeting those shareholders able to
attend.
Information about the business of the meeting and the nominees for election as
members of the Board of Directors is set forth in the Notice of Meeting and the
Joint Proxy Statement on the following pages. This year IDACORP, Inc. is asking
you to elect three Directors, to ratify the selection of an independent auditor
for the fiscal year ending December 31, 2004, and to act upon a shareholder
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.
/s/ Jon H. Miller /s/ Jan B. Packwood
- ---------------------- ----------------------
Jon H. Miller Jan B. Packwood
Chairman of the Board IDACORP President and Chief Executive Officer
Idaho Power Chief Executive Officer
TO VOTE BY MAIL, PLEASE DETACH PROXY CARD HERE
- --------------------------------------------------------------------------------
PROXY IDACORP, Inc.
PROXY FOR THE ANNUAL MEETING OF SHAREHOLDERS ON MAY 20,2004
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), to
elect three Directors, "For" proposal (2), to ratify the selection
of an independent auditor for the fiscal year ending December 31,
2004, and "Against" proposal (3), to act upon a shareholder
proposal requesting IDACORP to publish annually in the Proxy
Statement an explanation of Board procedures governing donations
to and a list of Board approved private foundations.
The undersigned hereby appoints Jan B. Packwood and Robert W.
Stahman, and each of them, proxies with full power of substitution
to vote for the undersigned at the Joint Annual Meeting of
Shareholders of IDACORP, Inc. and Idaho Power Company and at any
adjournment thereof, on the matters set forth in the Proxy
Statement and such other matters as may properly come before the
meeting; and hereby directs that this proxy be voted in accordance
with the instructions herein and in the proxies' discretion on any
other matters that may properly come before the meeting.
Please date, sign and promptly mail in the self-addressed return
envelope, which requires no postage if mailed in the United
States. Please so indicate following your signature if you are
signing in a representative capacity. If shares are held jointly,
both owners should sign.
----------------------
SEE REVERSE SIDE
----------------------
[LOGO] IDAHO POWER Annual Meeting of Shareholders
An IDACORP Company Thursday, May 20, 2004
10:00 a.m. Local Time
Idaho Power Corporate Headquarters
1221 West Idaho Street
Boise, Idaho 83707
- --------------------------------------------------------------------------------
THERE ARE THREE WAYS TO VOTE YOUR PROXY
TELEPHONE VOTING INTERNET VOTING VOTING BY MAIL
This method of voting is available Visit the Internet voting website Simply mark, sign and date
for residents of the U.S. and Canada. at http://proxy.georgeson.com. your proxy card and return
On a touch tone telephone, call TOLL Have your proxy card ready and it in the postage-paid
FREE 1-800-928-0380, 24 hours a day, follow the instructions on your envelope. If you are
7 days a week. Have your proxy card screen. You will incur only your voting by telephone or the
ready, then follow the prerecorded usual Internet charges. Available Internet, please do not
instructions. Your vote will be until 5:00 pm Eastern Time on May mail your proxy card.
confirmed and cast as you directed. 19, 2004.
Available until 5:00 pm Eastern Time
on May 19, 2004.
TO VOTE BY MAIL, PLEASE DETACH PROXY CARD HERE
- --------------------------------------------------------------------------------
/X/ Please mark votes
as in this example.
- --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSALS 1 AND 2
- --------------------------------------------------------------------------------
1. ELECTION OF DIRECTORS: Nominees: FOR all nominees WITHHOLD
01 Rotchford L Barker listed (except as authority to
02 Jon H. Miller indicated to vote for
03 Robert A. Tinstman the contrary) all nominees
|_| |_|
INSTRUCTIONS: To withhold authority
to vote for any individual nominee(s),
write the name(s) of such nominee(s)
in the space provided below.
-------------------------------------
2. To ratify the selection of FOR AGAINST ABSTAIN
Deloitte & Touche LLP as |_| |_| |_|
independent auditor for the
fiscal year ending December 31,
2004
DATE:
--------------------
----------------------------
----------------------------
Signature(s) in Box
----------------------------
----------------------------
Signature of Joint Owner
[LOGO] IDAHO
POWER
An IDACORP Company
April 12, 2004
Dear Shareholders of Idaho Power Company:
It is our pleasure to invite you to attend the upcoming 2004 joint Annual
Meeting of Shareholders of Idaho Power Company and IDACORP, Inc. to be held on
May 20, 2004, at 10:00 A.M., local time, at the Idaho Power Corporate
Headquarters, 1221 West Idaho Street, Boise, Idaho. Your Board of Directors and
management look forward to personally greeting those shareholders able to
attend.
Information about the business of the meeting and the nominees for election as
members of the Board of Directors is set forth in the Notice of Meeting and the
Joint Proxy Statement on the following pages. This year Idaho Power Company is
asking you to elect three Directors and to ratify the selection of an
independent auditor for the fiscal year ending December 31, 2004.
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.
/s/ Jon H. Miller /s/ Jan B. Packwood
- -------------------------- -------------------------
Jon H. Miller Jan B. Packwood
Chairman of the Board IDACORP President and Chief Executive Officer
Idaho Power Chief Executive Officer
TO VOTE BY MAIL, PLEASE DETACH PROXY CARD HERE
- --------------------------------------------------------------------------------
PROXY IDAHO POWER COMPANY
PROXY FOR THE ANNUAL MEETING OF SHAREHOLDERS ON MAY 20,2004
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), to
elect three Directors and "For" proposal (2), to ratify the
selection of an independent auditor for the fiscal year ending
December 31, 2004.
The undersigned hereby appoints Jan B. Packwood and Robert W.
Stahman, and each of them, proxies with full power of substitution
to vote for the undersigned at the Joint Annual Meeting of
Shareholders of Idaho Power Company and IDACORP, Inc. and at any
adjournment thereof, on the matters set forth in the Proxy
Statement and such other matters as may properly come before the
meeting; and hereby directs that this proxy be voted in accordance
with the instructions herein and in the proxies' discretion on any
other matters that may properly come before the meeting.
Please date, sign and promptly mail in the self-addressed return
envelope, which requires no postage if mailed in the United
States. Please so indicate following your signature if you are
signing in a representative capacity. If shares are held jointly,
both owners should sign.
----------------------
SEE REVERSE SIDE
----------------------