HEI Exhibit 99.1
----------------
HAWAIIAN ELECTRIC INDUSTRIES, INC.
DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
---------------------------------------------
(As amended through February 2, 1998)
Section 1. Name and Number of Shares
- -------------------------------------
The plan shall be known as the "Dividend Reinvestment and Stock
Purchase Plan" (the "Plan"). The Plan permits (i) holders of record of the
Common Stock of Hawaiian Electric Industries, Inc. (the "Company"), (ii) holders
of record of the preferred stock ("Preferred Stock") of any class or series of
Hawaiian Electric Company, Inc., Maui Electric Company, Limited and Hawaii
Electric Light Company, Inc., each of which is a direct or indirect subsidiary
of the Company, and (iii) any other individual of legal age or any entity, to
purchase common stock of the Company ("Common Stock"). The number of shares of
Common Stock which may be issued pursuant to the Plan shall be fixed from time
to time by the Board of Directors of the Company.
Section 2. Administration and Costs
- ------------------------------------
The administrator of the Plan (the "Administrator") shall administer
the Plan for participants, keep records, send statements of accounts to
participants, and perform other clerical and ministerial duties relating to the
Plan. The Administrator may be one or more officers or employees of the Company
or of its subsidiaries and shall be appointed from time to time by the
President, the Financial Vice President or the Treasurer of the Company. If the
Administrator is one or more employees of the Company, an independent trustee
(the "Trustee") shall be appointed by the President, the Financial Vice
President or the Treasurer of the Company, and shares under the Plan shall be
registered in the name of the Trustee. The initial Administrator shall be the
Shareholder Services Division of the Company.
Participants in the Plan will bear the cost of brokerage fees and
commissions, any service charges and applicable taxes related to shares
purchased or sold on the open market. The Company may also charge each
participant fees up to amounts that are reasonably related to the actual
administrative costs of the Plan, the amounts, frequency and manner of payment
of which shall be determined from time to time by the President, Financial Vice
President and Treasurer of the Company, or any of them.
Section 3. Eligibility and Enrollment
- --------------------------------------
The following persons shall be eligible to participate in the Plan
(the "participants") in accordance with the following enrollment procedures:
(a) Each holder of record of Common Stock and/or Preferred Stock shall
be eligible to participate in the Plan. In order to participate in the Plan,
owners of Common Stock and/or Preferred Stock whose shares are registered in
names other than their own (e.g., broker, bank nominee) must first either become
holders of record by having shares of Common Stock and/or Preferred Stock, as
the case may be, transferred into their own names or transfer shares of Common
Stock to the name of the Administrator (or the Trustee, if there is a Trustee)
for safekeeping under the Plan. In addition, an eligible stockholder must
complete and sign the Company-approved authorization form ("Shareholder
Authorization Form") for Common Stock and/or Preferred Stock, as the case may
be, and return it to the Administrator in the manner prescribed on the
Shareholder Authorization Form or in the current prospectus for the Plan. A
Shareholder Authorization Form must be received by the Administrator by the
dividend record date in order for the dividends for which the record is taken to
be reinvested under the Plan. The execution of a Shareholder Authorization Form
will result in the participation in the Plan of all Common Stock and all classes
and series of Preferred Stock registered in the participant's name unless the
participant indicates on the Form the number and kind of shares on which the
participant wishes to receive cash dividends. If a participant does not select
an option on the Shareholder Authorization Form, all dividends for all shares of
Common Stock and Preferred Stock held in the participant's name, and on all
shares held under the Plan for the participant, will be reinvested. A
participant may change any of the designations set forth in a Shareholder
Authorization Form by completing, signing and returning to the Administrator a
new Shareholder Authorization Form in the manner described above, which new Form
shall supersede the prior Form, or may make such changes in such other manner as
may be permitted by the Administrator.
(b) Any other individual of legal age or entity shall be eligible to
participate in the Plan. In order to participate in the Plan, each such
individual or entity must complete and sign the Company's enrollment form (the
"Non-holder Enrollment Form") and return it to the Administrator along with a
check or money order made payable to HEI/DRIP for an initial stock purchase of
not less than $250 and not more than $120,000. The execution of Non-holder
Enrollment Form will result in the reinvestment of all dividends held under the
Plan for the participant, unless the
2
participant submits a Shareholder Authorization Form and selects a different
investment option in that Form.
(c) Each participant may, pursuant to the Shareholder Authorization
Form and/or such other forms as the Administrator may from time to time
prescribe, elect one of the following three investment options: (1) under the
"full dividend reinvestment" option, a participant may reinvest cash dividends
on all shares of Common Stock and Preferred Stock registered in the name of a
participant and on all shares of Common Stock held under the Plan for the
participant to purchase additional shares of Common Stock; (2) under the
"partial dividend reinvestment" option, a participant may receive cash dividends
on a portion of the shares of Common Stock and/or Preferred Stock registered in
such participant's name and/or on a portion of the shares of Common Stock held
under the Plan for the participant, and reinvest the remainder of cash dividends
on such shares to purchase Common Stock; and (3) under the "optional cash
investment only/no dividend reinvestment" option, a participant may receive cash
dividends on all shares of Common Stock and/or Preferred Stock registered in the
participant's name and on shares of Common Stock held under the Plan for the
participant. Under any of the investment options, a participant may purchase
additional shares of Common Stock under the Plan by making optional cash
payments to the Plan as provided under Section 5. A participant may change such
participant's investment option by following the procedures under Section 3(a)
for changing the designations set forth in a Shareholder Authorization Form
and/or such other procedures as the Administrator may from time to time
prescribe.
(d) Shareholder Authorization and Non-holder Enrollment Forms shall be
made available by the Administrator.
(e) Each participant will remain a participant in the Plan until
participation is terminated pursuant to Section 12 hereof or until the Plan
itself is terminated.
(f) The Company reserves the right to restrict participation in the
Plan if it believes that such participation may be contrary to the general
intent of the Plan or in violation of applicable law.
Section 4. Cash Dividend Purchases
- -----------------------------------
If a participant has elected full or partial dividend reinvestment on
the shares of Common Stock or Preferred Stock registered in such participant's
name or on the shares of Common Stock held under the Plan for such participant,
such
3
cash dividends will be credited to each participant's account under the Plan and
will be automatically reinvested to purchase Common Stock on behalf of the
participants during the applicable Investment Period as described in Section 7.
Until participation in the Plan is terminated pursuant to Section 12 hereof,
Common Stock and/or Preferred Stock participating in the Plan shall include (1)
all shares of each class or series of shares of Common Stock and/or Preferred
Stock, as the case may be, designated by registered holders of such shares in
Shareholder Authorization Forms which have been received by the Company by the
record date for the payment of a cash dividend, including all such shares
purchased after receipt of said form, and all shares received as a result of a
stock dividend or stock split, (2) all shares of Common Stock transferred to the
Administrator (or the Trustee) for safekeeping under the Plan, and (3) all
shares of Common Stock purchased under the Plan for the accounts of shareholders
and non- holder investors, including all shares purchased with reinvested
dividends and optional cash payments, unless said shares have been withdrawn
pursuant to Section 13 hereof and are held in the name of a person who has not
signed a Shareholder Authorization Form.
In the case of participants whose dividends on Common Stock and/or
Preferred Stock are subject to United States income tax withholding, the amount
of tax to be withheld will be deducted from the amount of dividends on Common
Stock and/or Preferred Stock to determine the amount of dividends to reinvest.
The Administrator will credit dividends for all shares of Common Stock
and/or Preferred Stock participating in the Plan (other than dividends paid on
shares as to which the participant has elected to receive cash dividends) to the
participants' accounts on the basis of full and fractional shares held in these
accounts and will automatically reinvest such dividends (less any administration
fees and any amounts required to be withheld by United States income tax law) in
additional shares of Common Stock.
Section 5. Cash Purchases
- --------------------------
All participants, whether or not they have authorized the reinvestment
of cash dividends on Common Stock or Preferred Stock, shall be eligible to make
optional cash payments for purchases of additional shares of Common Stock under
the Plan. Optional cash payments shall be made by check or money order in U.S.
Dollars payable to HEI/DRIP (or may be made by electronic funds transfer from a
bank account designated by a participant, by payroll deduction, or by such other
means, in each case subject to approval by the Treasurer of the Company or the
4
Administrator) and any such payment may not be less than $25, nor may such
payments exceed $120,000 in any calendar year (including for purposes of this
limitation the initial payment made by a non-holder investor upon enrollment in
the Plan). Optional cash payments must be received by the Administrator at
least five (5) days before an Investment Date (as defined below) in order to be
invested on or commencing on that Investment Date. The Administrator will send
the participant a statement recording receipt and transmittal of the total
optional payments received for the Investment Period. The Plan will not be
required to accept any checks payable to a party other than HEI/DRIP even if
endorsed for payment to the Plan.
Section 6. Method of Purchase of Shares
- ----------------------------------------
The Plan will satisfy its requirements for shares of Common Stock
through purchases from the Company of authorized but unissued shares, through
open market purchases of shares. Open market purchases under the Plan, if any,
will be made through an independent agent that is a registered "broker-dealer"
or "bank," as such terms are defined in Section 3(a)(6) of the Securities
Exchange Act of 1934 ("Broker"). Neither the Administrator nor the Company, nor
any affiliate thereof, shall exercise any direct or indirect control or
influence over the times when or the prices at which the Broker may purchase the
Company's Common Stock for the Plan, the amounts of shares to be purchased
(other than the aggregate dollar amount acquired by the Plan), the manner in
which the shares are to be purchased, or the selection by the Broker of a broker
or dealer through which purchases may be executed. The Company shall not change
the method of acquiring shares of Common Stock to satisfy the Plan's
requirements, including any change from purchases from the Company of authorized
but unissued shares of Common Stock to open market purchases, or vice versa,
more than once in any three-month period. The method of acquiring shares will
be determined only at the direction of the Board of Directors or the Chief
Financial Officer of the Company. Any change to the method of acquiring shares
must be based on a recorded determination by the Board of Directors or the Chief
Financial Officer of the Company that the Company's need to raise additional
capital has changed, or that there is another valid reason for such change.
All dividend payments (unless invested in shares of Common Stock
issued by the Company on the dividend payment date) and optional cash payments
will be transmitted to a segregated escrow account or to the Broker: (1) if the
funds are received before noon, by the opening of business on the next business
day following the day of receipt of funds, or
5
(2) if the funds are received at or after noon, by the end of the next business
day following the day of receipt of funds.
Section 7. Timing of Purchases
- -------------------------------
Optional cash payments and dividend payments will be invested in
shares of Common Stock on or after the applicable Investment Date. The
"Investment Dates" for optional cash payments shall be the 15th and 30th days of
each month (except that the Investment Date for February shall be the last day
of the month). The "Investment Date" for Common Stock dividends and for
Preferred Stock dividends shall be on or within three business days prior to the
applicable dividend payment date. If any date for investment of dividends or
optional cash payments as stated above is not a business day, the "Investment
Date" shall be the next succeeding business day.
Interest will not be paid on optional cash payments or on reinvested
dividends prior to or after their investment in Common Stock or if for any
reason such payments and dividends are not invested pursuant to the Plan.
Shares purchased from the Company shall be purchased on the applicable
Investment Date. Shares purchased on the open market shall be purchased during
the period (each, an "Investment Period") commencing on each applicable
Investment Date and ending thirty (30) days thereafter; provided, however, that
optional cash payments not invested within 35 days of receipt, and dividend
payments not invested within 30 days of the dividend payment date, shall be
promptly returned, without interest, to the participants. In addition, funds
that are not invested during the applicable Investment Period will be promptly
returned, without interest, to the participants.
Shares of Common Stock purchased directly from the Company will be
credited to participants' accounts on the date purchased, except that if any
shares are purchased on the open market, all of the shares purchased during the
applicable Investment Period will be credited to participants' accounts as of
the day of purchase of the last share. The Broker will be instructed prior to
the commencement of each Investment Period regarding the amount of funds to be
used to purchase shares of Common Stock on the open market during such
Investment Period.
If the Broker is directed but unable to purchase sufficient shares in
the open market with cash dividends and/or optional payments during any
Investment Period, the Common Stock that is purchased on the open market will be
allocated among participants' accounts (on a pro rata basis if necessary)
according to the amount each participant had contributed in
6
cash dividends and, if there are any shares remaining, on a pro rata basis
according to the amount each participant had contributed in optional cash
payments. Any remaining funds will be returned to participants on a pro rata
basis.
If a participant has elected full or partial dividend reinvestment on
the shares of Common Stock or Preferred Stock registered in such participant's
name or on shares of Common Stock held under the Plan for such participant, the
cash dividends to be reinvested for such participant will remain with the
Company if reinvested on the dividend payment date in shares of Common Stock
purchased from the Company or will be delivered by the Company to the escrow
account or the Broker as described in Section 6 concurrently with payment of
cash dividends to nonparticipating shareholders. Optional cash payments will be
made by participants directly to the Administrator. The Administrator will
deliver or cause the Company to deliver funds to the escrow account or the
Broker as described in Section 6.
Section 8. Purchase Price of Shares
- ------------------------------------
The purchase price per share of Common Stock purchased for the
accounts of participants directly from the Company will be 100% of the average
of the high and low sales prices for the Common Stock on the composite tape for
stocks listed on the New York Stock Exchange on the business day prior to the
applicable Investment Date or such later date as such stock is purchased (or the
last prior day on which the Common Stock is traded if there is no trade reported
on the business day prior to the applicable Investment Date or such later date).
The purchase price per share of Common Stock purchased on the open market will
be the weighted average price per share (adjusted for brokerage fees and
commissions, any service charges and applicable taxes) of the aggregate number
of shares acquired on the open market by the Broker during the applicable
Investment Period. Amounts to be invested in shares of Common Stock during any
Investment Period will not be pooled with amounts to be invested during another
Investment Period for purposes of computing per share prices. Amounts to be
invested in any Investment Period will be invested to the extent possible before
any purchases are executed for any subsequent Investment Period.
Section 9. Registration of Shares
- ----------------------------------
Shares of Common Stock purchased under the Plan will be registered in
the name of the Administrator (or the Trustee, if there is a Trustee) as agent
for the participants. Shares
7
will not be issued to participants unless requested pursuant to Section 13
hereof.
For safekeeping or other purposes, holders of record of Common Stock
who submit Shareholder Authorization Forms may elect to transfer their shares of
Common Stock to the Administrator (or the Trustee, if there is a Trustee),
without charge, to the credit of their account under the Plan, pursuant to such
procedures as the Company and the Administrator shall establish.
Section 10. Participants' Accounts
- -----------------------------------
The Administrator shall keep an individual account for each
participant recording the participant's interest in the Plan. Each
participant's account will be credited with that number of shares, including
fractions computed to four decimal places, equal to the total amount of cash
dividends or optional cash payments to be invested, less administrative fees and
amounts required to be withheld for tax purposes, divided by the applicable
purchase price per share.
Section 11. Reports to Participants
- ------------------------------------
Participants who reinvest dividends and/or make optional cash payments
will receive periodic statements of account showing amounts invested, purchase
prices, shares purchased, and/or other relevant information. In addition, each
participant shall receive copies of the Company's annual report to stockholders,
notices of annual meetings, proxy statements, and information for income tax
reporting purposes.
Section 12. Termination of Participation
- -----------------------------------------
A participant may terminate participation in the Plan as to all (but
not less than all) Common Stock and Preferred Stock participating in the Plan at
any time by written notification to the Administrator. Any notice of
termination received on or after an ex-dividend record date will not be
effective until dividends have been paid, credited to the participant's Plan
account and reinvested in additional shares of Common Stock in accordance with
the Plan. Within ten business days after the later to occur of (a) the receipt
of notice of termination and (b) reinvestment of dividends as to participants
whose notice of termination is received after an ex-dividend record date,
certificates for whole shares of Common Stock credited to the participant's Plan
account will be issued and a cash payment will be made for any fraction of a
8
share; provided, however, that if a participant's account is credited with less
than five shares, the participant will receive cash in lieu of shares unless the
Company otherwise elects. Cash payments for any fraction of a share or for less
than five shares will be based on the market price per share (determined in the
manner provided in Section 8 hereof for shares purchased directly from the
Company) on the last business day prior to the date of payment to the
terminating participant. In no case will certificates for fractional shares be
issued.
A participant must maintain at least one whole share of Common Stock
in the Plan to keep an active account. If a participant does not maintain at
least one whole share in the Plan, the participant's participation in the Plan
may be terminated, in which case the participant will receive a cash payment
based on the market price per share (determined in the manner provided in
Section 8 hereof for shares purchased directly from the Company) on the business
day prior to the date of payment to the terminating participant.
Termination of participation in the Plan will not preclude re-
enrollment, provided that the Company reserves the right to reject re-
enrollment where in its sole discretion it deems there have been excessive
terminations and re-enrollments.
The term "ex-dividend record date" for purposes of the Plan is three
(3) business days prior to the dividend record date.
Section 13. Withdrawal of Shares
- ---------------------------------
A participant may withdraw all or a portion of shares of Common Stock
from the participant's account by notifying the Administrator in writing to that
effect and specifying the whole number of shares to be withdrawn. Withdrawal of
shares must be in full shares only. Fractional shares will be liquidated upon
termination of participation as described under Section 12. Any notice of
withdrawal received on or after an ex-dividend record date will not be effective
until dividends have been paid, credited to the participant's Plan account and
reinvested in additional shares of Common Stock in accordance with the Plan.
Within ten business days after the later to occur of (a) receipt of notice of
withdrawal and (b) reinvestment of dividends as to participants whose notice of
withdrawal is received on or after an ex-dividend record date, certificates for
whole shares of Common Stock so withdrawn will be issued. In no case will
certificates for fractional shares be issued.
9
Shares withdrawn from the Plan and registered in the participant's
name will continue to participate in the Plan if the participant has so
instructed the Administrator pursuant to a Shareholder Authorization Form and
has not terminated participation pursuant to Section 12 hereof.
Accounts are maintained in the names used by participants at the time
they entered the Plan. However, a participant who wishes to withdraw shares and
have the stock certificates issued in the name of another person may do so by
submitting a properly completed and executed stock power, with a Medallion
signature guarantee, and complying with such other procedures as the Company or
Administrator shall establish.
Section 14. Sale and Transfer of Shares
- ----------------------------------------
Unless the participant satisfies the requirements specified in Section
13 for the issuance of certificates in the name of another person, shares of
Common Stock credited to a participant's account under the Plan or otherwise
registered in the Administrator's (or Trustee's) name may not be pledged,
encumbered, sold or otherwise transferred by a participant. Absent satisfaction
of said requirements, a participant wishing to sell, pledge, encumber or
otherwise dispose of shares must have those shares registered in his name by
terminating participation in the Plan pursuant to Section 12 or withdrawing the
shares pursuant to Section 13.
A participant who wishes to receive cash in lieu of shares of Common
Stock upon termination of participation or withdrawal of shares may request the
Administrator to sell such shares and to deliver the net proceeds to the
participant. The net proceeds shall equal the selling price of the shares less
the brokerage fees and commissions, any withholding required under applicable
tax laws and a fee of $15 for the handling of each such request.
Section 15. Voting of Shares
- -----------------------------
Each participant will be sent a notice of meeting and proxy statement
and form of proxy for each meeting of shareholders of the Company. Each
participant will vote directly the shares registered in such participant's name.
The Administrator (or the Trustee, as the case may be) shall be deemed
instructed to vote the shares of Common Stock it holds in the Plan for a
participant who has shares registered in such participant's own name in the same
way that said participant votes the shares of Common Stock registered in the
participant's name, unless the participant instructs that the shares held in
10
the Plan are to be voted in another way, in which event said shares shall be
voted as instructed. If no shares of Common Stock are registered in a
participant's name, the Administrator (or the Trustee, as the case may be) shall
vote the shares it holds in the Plan for the participant in accordance with
instructions of the participant given on the proxy form duly signed and returned
by the participant. In the absence of any of the foregoing types of
instructions, the Administrator (or the Trustee, as the case may be) will vote
the shares registered in its name in the same proportion on each issue as it
votes those shares as to which it has received instructions.
Section 16. Limitation of Liability
- ------------------------------------
Neither the Company nor the Administrator nor the Trustee nor the
Broker nor any of their respective officers, directors, representatives,
employees or agents shall be liable for any damages resulting from any act or
omission in connection with the Plan in the absence of bad faith or gross
negligence.
Section 17. Common Stock Adjustment Provisions
- -----------------------------------------------
If the outstanding shares of common stock of the Company are decreased
or exchanged for a different number or kind of shares or other securities, or if
additional shares or new or different shares or other securities are distributed
with respect to such shares of common stock or other securities, through merger,
consolidation, sale of all or substantially all of the property of the Company,
recapitalization, reclassification, stock dividend, stock split, reverse stock
split or other distribution with respect to such shares of common stock or other
securities, an appropriate and proportionate adjustment may, subject to the
requirements of federal and state securities laws and regulations, be made by
the Company to the maximum number and kind of shares of common stock or other
securities issuable under the Plan which are subject to an effective
registration statement filed with the Securities Exchange Commission pursuant to
the Securities Act of 1933, as amended.
Section 18. Other Matters
- --------------------------
The Board of Directors, Chief Financial Officer or Treasurer of the
Company shall determine the effective date of the Plan as most recently amended
hereby.
11
The Company intends to continue the Plan indefinitely, but reserves
the right to suspend or terminate the Plan at any time. The Company also
reserves the right to make any additions or modifications to the Plan. The
Treasurer of the Company may interpret the Plan and may make additions thereto
which are not inconsistent with the above provisions of the Plan.
In the event any stock dividends or split shares are distributed by
the Company on shares of Common Stock credited to the account of a participant
under the Plan, such shares will be added to the participant's account. Stock
dividends or split shares distributed on any shares of Common Stock registered
in the name of a participant will be distributed to the participant in the same
manner as to shareholders who are not participating in the Plan.
In the event that the number of shares of Common Stock to be purchased
by the participants in the Plan exceeds the balance of the shares authorized by
the Board of Directors to be sold pursuant to the Plan, then the Plan shall be
automatically suspended with respect to future purchases until such time as the
Board of Directors of the Company has authorized additional shares of Common
Stock to be sold pursuant to the Plan. In the event of any such automatic
suspension of the Plan, then (1) on the date of such automatic suspension of the
Plan, the number of shares of Common Stock to be sold shall be prorated among
the participants purchasing shares on such date, and (2) the Treasurer of the
Company shall determine the date the suspension is to be lifted after the Board
of Directors has authorized the sale of additional shares of Common Stock
pursuant to the Plan.
The Company will notify each participant of the commencement of any
tender offer for securities which include the Company's Common Stock held in
participants' accounts. The Company will use its best efforts to distribute to
participants in a timely manner the same information that is distributed to all
of the Company's shareholders in connection with the tender offer. After
consulting with the Trustee, the Company will provide a means by which
participants may direct the Trustee whether or not to tender the Company's
Common Stock credited to their accounts. The Trustee will not tender shares
held in any participant's account for which it receives no direction from the
participant. A participant may, at any time prior to a tender offer withdrawal
date, direct the Trustee to withdraw shares of the Company's Common Stock
previously directed by the participant to be tendered.
12
The Company or the Administrator shall provide participants with
prompt notice of any modification, suspension or termination of the Plan.
Certificates for whole shares issued to a participant upon termination
of participation in the Plan pursuant to Section 12, or upon withdrawal of
shares pursuant to Section 13, or upon termination of the Plan by the Company,
shall be registered in the names used by participants at the time they enrolled
in the Plan, except as otherwise provided pursuant to Section 13.
The Hawaiian Electric Industries Retirement Savings Plan and any other
plans of the Company or its direct or indirect subsidiaries may participate in
the Plan on such terms and in such manner as may be determined by the Treasurer
of the Company.
13