View:
As filed with the Securities and Exchange Commission on May 13, 1996.
Registration No.
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------
THE WASHINGTON WATER POWER COMPANY
(Exact name of registrant as
specified in its charter)
--------------------------
WASHINGTON 91-1653826
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1411 East Mission Avenue
Spokane, Washington 99202-2600
(509) 489-0500
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
THE WASHINGTON WATER POWER COMPANY
NON-EMPLOYEE DIRECTOR STOCK PLAN
(Full Title of Plan)
--------------------------
PAUL A. REDMOND JON E. ELIASSEN
Chairman of the Board, President Vice President - Finance
and Chief Executive Officer The Washington Water Power Company
The Washington Water Power Company 1411 East Mission Avenue
1411 East Mission Avenue Spokane, Washington 99202-2600
Spokane, Washington 99202-2600 (509) 489-0500
(509) 489-0500
RONALD R. PETERSON ELIZABETH W. POWERS, ESQ.
Treasurer Reid & Priest LLP
The Washington Water Power Company 40 West 57th Street
1411 East Mission Avenue New York, New York 10019-4097
Spokane, Washington 99202-2600 (212) 603-2000
(509) 489-0500
(Names, addresses and telephone numbers,
including area codes, of agents for service)
--------------------------
CALCULATION OF REGISTRATION FEE
=======================================================================
Proposed Proposed
maximum maximum
Title of offering aggregate Amount of
securities to Amount to be price per offering registration
be registered registered(1) unit (2) price (2) fee
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Common Stock
(no par value) 150,000 shares
$18 $2,700,000 $932(3)
Preferred Share
Purchase Rights 150,000
rights(3)
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(1) In addition, pursuant to Rule 416(a) under the Securities Act of
1933, as amended, this registration statement also covers any
additional securities to be offered or issued in connection with a
stock split, stock dividend or similar transaction.
(2) Estimated pursuant to Rule 457(h) under the Securities Act of 1933,
as amended, based on the average of the reported high and low sales
prices on the consolidated transaction reporting system on May 6,
1996.
(3) The Preferred Share Purchase Rights (the "Rights") are appurtenant
to and will trade with the Common Stock. The value attributable to
the Rights, if any, is reflected in the market price of the Common
Stock. Since no separate consideration is paid for the Rights, the
registration fee for such securities is included in the fee for the
Common Stock.
=========================================================================
THE WASHINGTON WATER POWER COMPANY
NON-EMPLOYEE DIRECTOR STOCK PLAN
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The Washington Water Power Company (the "Company")
hereby incorporates herein by reference the following documents
previously filed by the Company with the Securities and Exchange
Commission:
(1) The Company's Annual Report on Form 10-K for the year
ended December 31, 1995.
All documents subsequently filed by the Company
pursuant to Sections 13, 14 or 15(d) of the Securities Exchange
Act of 1934, as amended, prior to the filing of a post-effective
amendment which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold
shall be deemed to be incorporated herein by reference and to be
a part hereof from the respective dates of filing thereof. Any
statement contained in an incorporated document shall be deemed
to be modified or superseded to the extent that a statement
contained herein or in any subsequently filed incorporated
document modifies of supersedes such statement.
Pursuant to an Agreement and Plan of Reorganization and
Merger, dated as of June 27, 1994, as amended (the "Merger
Agreement"), the Company, Sierra Pacific Resources and Sierra
Pacific Power Company will merge with and into Altus Corporation,
with each share of Company Common Stock being converted into one
share of Altus Common Stock. Reference is made to the Merger
Agreement, incorporated by reference as an exhibit hereto.
Item 4. DESCRIPTION OF COMMON STOCK
The authorized capital stock of the Company consists of
10,000,000 shares of Preferred Stock, cumulative, without nominal
or par value, which is issuable in series, and 200,000,000 shares
of Common Stock without nominal or par value. Following is a
brief description of certain of the rights and privileges of the
Common Stock of the Company. For a complete description,
reference is made to the Company's Restated Articles of
Incorporation, as amended (the "Articles"), and to the laws of
the State of Washington. The following summary, which does not
purport to be complete, is qualified in its entirety by such
reference.
DIVIDEND RIGHTS
After full provision for all Preferred Stock dividends
declared or in arrears, the holders of Common Stock of the
Company are entitled to receive such dividends as may be lawfully
declared from time to time by the Board of Directors of the
Company.
VOTING RIGHTS
The holders of the Common Stock have sole voting power,
except as indicated below or as otherwise provided by law, and
each holder of Common Stock is entitled to vote cumulatively for
the election of directors. If dividends payable on any shares of
Preferred Stock shall be in arrears in an amount equal to the
aggregate amount of dividends accumulated on such shares of
Preferred Stock over the eighteen (18) month period ended on such
date, the holders of such stock become entitled, as one class, to
elect a majority of the Board of Directors, which right does not
cease until all defaults in the payment of dividends on the
Preferred Stock shall have been cured. In addition, the consent
of various proportions of the Preferred Stock at the time
outstanding is required to adopt any amendment to the Articles
which would authorize any new class of stock ranking prior to or
on a parity with the Preferred Stock as to certain matters, to
increase the authorized number of shares of the Preferred Stock
or to change any of the rights or preferences of outstanding
Preferred Stock.
CLASSIFIED BOARD OF DIRECTORS
Both the Articles and the Company's Bylaws, as amended
(the "Bylaws") provide for a Board of Directors divided into
three classes, each of which will generally serve for a term of
three years, with only one class of directors being elected in
each year. The Articles and Bylaws also provide that directors
may be removed only for cause and only by the affirmative vote of
the holders of at least a majority of the Common Stock. The
Articles and Bylaws further require an affirmative vote of the
holders of at least 80% of the Common Stock to alter, amend or
repeal the provisions relating to the classification of the Board
of Directors and the removal of members from, and the filling of
vacancies on, the Board of Directors.
CHANGE IN CONTROL
The Articles contain a "fair price" provision which
requires the affirmative vote of the holders of at least 80% of
the Common Stock for the consummation of certain business
combinations, including mergers, consolidations,
recapitalizations, certain dispositions of assets, certain
issuances of securities, liquidations and dissolutions involving
the Company and a person or entity who is or, under certain
circumstances, was, a beneficial owner of 10% or more of the
outstanding shares of Common Stock (an "Interested Shareholder")
unless (a) such business combination shall have been approved by
a majority of the directors unaffiliated with the Interested
Shareholder or (b) certain minimum price and procedural
requirements are met. The Articles provide that the "fair price"
provision may be altered, amended or repealed only by the
affirmative vote of the holders of at least 80% of the Common
Stock.
PREFERRED SHARE PURCHASE RIGHTS
Reference is made to the Rights Agreement, dated as of
February 16, 1990, as amended (the "Rights Agreement"), between
the Company and The Bank of New York, successor Rights Agent to
First Chicago Trust Company of New York, filed with the Securities
and Exchange Commission. The following statements are qualified
in their entirety by such reference.
The Company has adopted a shareholder rights plan
pursuant to which holders of Common Stock outstanding on March 2,
1990 or issued thereafter have been granted one preferred share
purchase right (a "Right") on each outstanding share of Common
Stock. The description and terms of the Rights are set forth in
the Rights Agreement. Certain of the capitalized terms used in
the following description have the meanings set forth in the
Rights Agreement.
The Rights have certain anti-takeover effects. The
Rights may cause substantial dilution to a person or group that
attempts to acquire the Company on terms not approved by the
Company's Board of Directors, except pursuant to an offer
conditioned on a substantial number of Rights being acquired.
The Rights should not interfere with any merger or other business
combination approved by the Board of Directors of the Company
prior to the time that a person or group has acquired beneficial
ownership of 10% or more of the Common Stock since until such
time the Rights may be redeemed as hereinafter described.
Each Right, initially evidenced by and traded with the
shares of Common Stock, entitles the registered holder to
purchase one two-hundredth of a share of Preferred Stock of the
Company, without par value (the "Preferred Shares"), at an
exercise price of $40, subject to certain adjustments, regulatory
approval and other specified conditions. The Rights will be
exercisable only if a person or group acquires 10% or more of the
Common Stock or announces a tender offer, the consummation of
which would result in the beneficial ownership by a person or
group of 10% or more of the Common Stock.
If any person or group acquires 10% or more of the
outstanding Common Stock, each Right will entitle its holder
(other than such person or members of such group), subject to
regulatory approval and other specified conditions, to purchase
that number of shares of Common Stock or Preferred Shares having
a market value of twice the Right's exercise price. In addition,
in the event that any person or group has acquired 10% or more of
the outstanding Common Stock or the Company consolidates or
merges with or into, or sells 50% or more of its assets or
earning power to, any person or group, or engages in certain
"self dealing" transactions with any person or group owning 10%
or more of the outstanding Common Stock, proper provision will be
made so that each Right would thereafter entitle its holder to
purchase that number of the acquiring company's common shares
having a market value at that time of twice the Right's exercise
price.
At any time after a person or group acquires more than
10% but less than 50% of the outstanding Common Stock, the Board
of Directors of the Company may, subject to any necessary
regulatory approval, require each outstanding Right to be
exchanged for one share of Common Stock or cash, securities or
other assets having a value equal to the market value of one
share of Common Stock.
The Rights may be redeemed, at a redemption price of
$.005 per Right, by the Board of Directors of the Company at any
time until any person or group has acquired 10% or more of the
Common Stock. Under certain circumstances, the decision to
redeem the Rights will require the concurrence of a majority of
the Continuing Directors. The Rights will expire on the earlier
of February 16, 2000 and the effective time of the merger.
LIQUIDATION RIGHTS
In the event of any liquidation of the Company, after
satisfaction of the preferential liquidation rights of the
Preferred Stock, the holders of the Common Stock would be
entitled to share ratably in all assets of the Company available
for distribution to shareholders.
PRE-EMPTIVE RIGHTS
No holder of any stock of the Company has any pre-
emptive rights.
MISCELLANEOUS
The presently outstanding shares of Common Stock of the
Company are fully paid and nonassessable.
The Common Stock of the Company is listed on the New
York and Pacific Stock Exchanges.
The New York Transfer Agent and Registrar for the
Common Stock is The Bank of New York, 101 Barclay Street, 11th
Floor, New York, New York 10286. The Company, P.O. Box 3647,
Spokane, Washington 99220-3647, is an additional Transfer Agent
and Registrar for the Common Stock.
Item 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The Company's consolidated financial statements and
related financial statement schedules for the year ended December
31, 1995, incorporated in this registration statement by
reference from the Company's Annual Report on Form 10-K, have
been audited by Deloitte & Touche LLP, independent auditors, as
stated in their report, and have been so incorporated in reliance
upon the report of such firm given upon their authority as experts
in accounting.
Item 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article Seventh of the Articles provides, in part, as
follows:
"The Corporation shall, to the full extent
permitted by applicable law, as from time to time in
effect, indemnify any person made a party to, or
otherwise involved in, any proceeding by reason of the
fact that he or she is or was a director of the
Corporation against judgments, penalties, fines,
settlements and reasonable expenses actually incurred
by him or her in connection with any such proceeding.
The Corporation shall pay any reasonable expenses
incurred by a director in connection with any such
proceeding in advance of the final determination
thereof upon receipt from such director of such
undertakings for repayment as may be required by
applicable law and a written affirmation by such
director that he or she has met the standard of conduct
necessary for indemnification, but without any prior
determination, which would otherwise be required by
Washington law, that such standard of conduct has been
met. The Corporation may enter into agreements with
each director obligating the Corporation to make such
indemnification and advances of expenses as are
contemplated herein. Notwithstanding the foregoing,
the Corporation shall not make any indemnification or
advance which is prohibited by applicable law. The
rights to indemnity and advancement of expenses granted
herein shall continue as to any person who has ceased
to be a director and shall inure to the benefit of the
heirs, executors and administrators of such a person."
The Company has entered into indemnification agreements
with each director as contemplated in Article Seventh of the
Articles.
Article IX of the Company's Bylaws contains a similar
provision to that contained in the Articles and in addition,
provides in part, as follows:
"SECTION 2. LIABILITY INSURANCE. The Corporation
shall have the power to purchase and maintain insurance
on behalf of any person who is, or was a director,
officer, employee, or agent of the Corporation or is or
was serving at the request of the Corporation as a
director, officer, employee or agent of another
corporation, partnership, joint venture, trust, other
enterprise, or employee benefit plan against any
liability asserted against him and incurred by him in
any such capacity or arising out of his status as such,
whether or not the Corporation would have the power to
indemnify him against such liability under the laws of
the State of Washington."
Reference is made to Washington Business Corporation
Act 23B.08.510, which sets forth the extent to which
indemnification is permitted under the laws of the State of
Washington.
Insurance is maintained on a regular basis (and not
specifically in connection with this offering) against
liabilities arising on the part of directors and officers out of
their performance in such capacities or arising on the part of
the Company out of its foregoing indemnification provisions,
subject to certain exclusions and to the policy limits.
The Merger Agreement provides for indemnification by
Altus Corporation, to the fullest extent not prohibited by
applicable law, after the effective time of the merger, of
present and former officers and directors of the Company against
certain liabilities arising out of or pertaining to acts or
omissions, occurring at or prior to the effective time, that
arise out of or are based upon such services as an officer or
director that arise from or pertain to transactions contemplated
by the Merger Agreement.
Item 8. EXHIBITS.
With
Registration As
Exhibit Number Exhibit
------- ------ -------
*4(a) 1-3701 (with 4(a) Restated Articles of
Form 10-Q for Incorporation, as amended,
quarter ended of the Company.
June 30, 1994)
*4(b) 1-3701 (with 3(b) Bylaws of the Company, as
Form 10-Q for amended May 11, 1995.
quarter ended
June 30, 1995)
*4(c) 1-3701 (with 4(n) Rights Agreement, dated as
Form 8-K dated of February 16, 1990,
February 16, between the Company and
1990) The Bank of New York as
successor Rights Agent.
*4(d) 1-3701 (with 4(b) Amendment No. 1 to Rights
Form 10-Q for Agreement, dated as of May
quarter ended 10, 1994.
March 31, 1994)
*4(e) 1-3701 (with 4(b) Amendment No. 2 to Rights
Form 10-Q for Agreement, dated as of
quarter ended June 27, 1994.
September 30,
1994)
*4(f) 1-3701 (with 2(a) Agreement and Plan of
Form 8-K dated Reorganization and Merger,
June 27, 1994) dated as of June 27, 1994,
by and among the Company,
Sierra Pacific Resources,
Sierra Pacific Power
Company and Altus
Corporation.
10 Non-Employee Director
Stock Plan.
23 Consent of Deloitte &
Touche LLP.
24 See page II-11 for Power
of Attorney.
---------------
* Previously filed and incorporated herein by reference.
Item 9. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this
registration statement; (i) to include any prospectus
required by Section 10(a)(3) of the Securities Act of
1933; (ii) to reflect in the prospectus any facts or
events arising after the effective date of the
registration statement (or the most recent post-
effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the
information set forth in the registration statement,
(Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed
that which was registered) and any deviation from the
low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with
the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no
more than a 20% change in the maximum aggregate
offering price set forth in the "Calculation of
Registration Fee" table in the effective registration
statement.) and (iii) to include any material
information with respect to the plan of distribution
not previously disclosed in the registration statement
or any material change to such information in the
registration statement; provided, however, that the
registrant need not file a post-effective amendment to
include the information required to be included by
subsection (i) or (ii) if such information is contained
in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or
Section 15(d) of the Exchange Act that are incorporated
by reference in the registration statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-
effective amendment shall be deemed to be a new
registration statement relating to the securities
offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide
offering thereof.
(3) To remove from registration by means of a post-
effective amendment any of the securities being
registered which remain unsold at the termination of
the offering.
(4) That, for purposes of determining any liability under
the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or
Section 15(d) of the Exchange Act that is incorporated
by reference in the registration statement shall be
deemed to be a new registration statement relating to
the securities offered herein, and the offering of such
securities at that time shall be deemed to be the
initial bona fide offering thereof.
Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the registrant, pursuant to
the provisions described under Item 6 above, or otherwise, the
registrant has been informed that in the opinion of the
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or
proceeding) is asserted against the registrant by such director,
officer or controlling person in connection with the securities
being registered, the registrant will, unless in the opinion of
its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final
adjudication of such issue.
POWER OF ATTORNEY
The Registrant hereby appoints each Agent for Service
named in this Registration Statement as its attorney-in-fact to
sign in its name and behalf, and to file with the Commission, any
and all amendments, including post-effective amendments, to this
Registration Statement, and each director and/or officer of the
Registrant whose signature appears below hereby appoints each
such Agent for Service as his attorney-in-fact with like
authority to sign in his name and behalf, in any and all
capacities stated below, and to file with the Commission, any and
all such amendments.
SIGNATURES
THE REGISTRANT. Pursuant to the requirements of the
Securities Act of 1933, the Registrant certifies that it has
reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Spokane
and State of Washington on the 10th day of May, 1996.
THE WASHINGTON WATER POWER COMPANY
By /s/ Paul A. Redmond
-----------------------------------
Paul A. Redmond
Chairman of the Board, President
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons
in the capacities and on the date indicated.
Signature Title Date
--------- ----- ----
/s/ Paul A. Redmond
------------------------------- Principal May 10, 1996
Paul A. Redmond (Chairman of Executive
the Board, President and Chief Officer and
Executive Officer) Director
/s/ J. E. Eliassen
------------------------------- Principal May 10, 1996
J. E. Eliassen (Vice President Financial and
- Finance and Chief Financial Accounting
Officer) Officer
/s/ David A. Clack
------------------------------- Director May 10, 1996
David A. Clack
/s/ Duane B. Hagadone
------------------------------- Director May 10, 1996
Duane B. Hagadone
------------------------------- Director
Robert S. Jepson Jr.
/s/ Eugene W. Meyer
------------------------------- Director May 10, 1996
Eugene W. Meyer
/s/ Gen. N. Norman Schwarzkopf
------------------------------- Director May 10, 1996
General H. Norman Schwarzkopf
/s/ B. Jean Silver
------------------------------- Director May 10, 1996
B. Jean Silver
/s/ Larry A. Stanley
------------------------------- Director May 10, 1996
Larry A. Stanley
/s/ R. John Taylor
------------------------------- Director May 10, 1996
R. John Taylor
EXHIBIT INDEX
With
Registration As
Exhibit Number Exhibit
------- ------ -------
*4(a) 1-3701 (with 4(a) Restated Articles of
Form 10-Q for Incorporation, as amended,
quarter ended of the Company.
June 30, 1994)
*4(b) 1-3701 (with 3(b) Bylaws of the Company, as
Form 10-Q for amended May 11, 1995.
quarter ended
June 30, 1995)
*4(c) 1-3701 (with 4(n) Rights Agreement, dated as
Form 8-K dated of February 16, 1990,
February 16, between the Company and
1990) The Bank of New York as
successor Rights Agent.
*4(d) 1-3701 (with 4(b) Amendment No. 1 to Rights
Form 10-Q for Agreement, dated as of May
quarter ended 10, 1994.
March 31, 1994)
*4(e) 1-3701 (with 4(b) Amendment No. 2 to Rights
Form 10-Q for Agreement, dated as of
quarter ended June 27, 1994.
September 30,
1994)
*4(f) 1-3701 (with 2(a) Agreement and Plan of
Form 8-K dated Reorganization and Merger,
June 27, 1994) dated as of June 27, 1994,
by and among the Company,
Sierra Pacific Resources,
Sierra Pacific Power
Company and Altus
Corporation.
10 Non-Employee Director
Stock Plan.
23 Consent of Deloitte &
Touche LLP.
24 See page II-11 for Power
of Attorney.
---------------
* Previously filed and incorporated herein by reference.
Exhibit 10
THE WASHINGTON WATER POWER COMPANY
NON-EMPLOYEE DIRECTOR STOCK PLAN
1. Establishment, Purpose and Duration of the Plan
-----------------------------------------------
(a) The Washington Water Power Company hereby establishes
"The Washington Water Power Company Non-Employee
Director Stock Plan" (hereinafter referred to as the
"Plan"), as set forth in this document. The Plan
provides for the automatic grant of Common Stock to
non-employee directors.
(b) The Plan shall become effective as of January 1, 1996
(the "Effective Date"), subject to shareholder
approval, and shall remain in effect as provided
herein.
(c) The purpose of the Plan is to provide ownership of the
Company's Common Stock to non-employee members of the
Board of Directors in order to improve the Company's
ability to attract and retain highly qualified
individuals to serve as directors of the Company, to
provide competitive compensation for Board service and
to strengthen the commonality of interest between
directors and shareholders.
(d) The Plan shall remain in effect, subject to the right
of the Board of Directors to terminate the Plan at any
time pursuant to Section 13, until all shares subject
to the Plan have been purchased or acquired according
to the Plan's provisions. Unless previously
terminated by the Board, the Plan will terminate on
the tenth anniversary of the Effective Date.
2. Definitions
-----------
When used herein, the following terms shall have the
respective meanings set forth below:
(a) "Annual Retainer" means the annual retainer payable to
---------------
all Non-Employee Directors (exclusive of any per
meeting fees, committee chair fees or expense
reimbursements). The Annual Retainer shall be
prorated based on the number of calendar months
(including partial calendar months) a director has
served (or is expected to serve) during a Plan Year as
a Non-Employee Director, for any director who is
newly-elected or appointed to, or leaves, the board of
directors of a Participating Company during a Plan
Year.
(b) "Annual Meeting of Shareholders" means the annual
------------------------------
meeting of shareholders of the Company at which
directors of the Company are elected.
(c) "Board" or "Board of Directors" means the Board of
----- ------------------
Directors of the Company.
(d) "Committee" means a committee whose members meet the
---------
requirements of Section 4(a) herein, appointed from
time to time by the Board to administer the Plan.
(e) "Common Stock" means the common stock, no par value,
------------
of the Company.
(f) "Company" means The Washington Water Power Company, a
-------
Washington corporation, or any successor corporation
as provided in Section 15 herein.
(g) "Effective Date" of the Plan means January 1, 1996.
--------------
(h) "Employee" means any officer or employee of the
--------
Company or of any Subsidiary (whether or not such
Subsidiary participates in the Plan). Directors who
are not otherwise employed by the Company shall not be
considered Employees for purposes of the Plan.
(i) "Exchange Act" means the Securities Exchange Act of
------------
1934, as amended from time to time, or any successor
act thereto.
(j) "Non-Employee Director" or "Participant" means any
--------------------- -----------
person who is elected or appointed to the board of
directors of any Participating Company and who is not
an Employee.
(k) "Participating Company" means the Company and any
---------------------
Subsidiary of the Company whose participation in the
Plan has been approved by both the Company's and such
Subsidiary's board of directors.
(l) "Plan" means the Company's Non-Employee Director Stock
----
Plan as set forth herein, as it may be amended from
time to time.
(m) "Plan Year" means the period commencing on the
---------
Effective Date of the Plan and ending December 31,
1996 and, thereafter, the calendar year.
(n) "Stock Payment" means the fixed portion of the Annual
-------------
Retainer to be paid to Non-Employee Directors in
shares of Common Stock rather than cash for services
rendered as a director of a Participating Company as
provided in Section 6 hereof including that portion of
the Stock Payment resulting from the election
specified in Section 7 herein.
(o) "Subsidiary" means any corporation that is a
----------
"subsidiary corporation" of the Company, as that term
is defined in Section 424(f) of the Internal Revenue
Code of 1986, as amended.
3. Shares of Common Stock Subject to the Plan
------------------------------------------
Subject to Section 9 below, the maximum aggregate number of
shares of Common Stock that may be delivered under the Plan is
One Hundred Fifty Thousand (150,000) shares. The Common Stock to
be delivered under the Plan will be made available from
authorized but unissued shares of Common Stock or through
purchases made on the open market.
4. Administration of the Plan
--------------------------
(a) The Plan will be administered by a committee appointed
by the Board, consisting of three or more persons who
are not eligible to participate in the Plan. Members
of the Committee need not be members of the Board.
The Company shall pay all costs of administration of
the Plan.
(b) Subject to the express provisions of the Plan, the
Committee has and may exercise such powers and
authority of the Board as may be necessary or
appropriate for the Committee to carry out its
functions under the Plan. Without limiting the
generality of the foregoing, the Committee shall have
full power and authority (i) to determine all
questions of fact that may arise under the Plan, (ii)
to interpret the Plan and to make all other
determinations necessary or advisable for the
administration of the Plan and (iii) to prescribe,
amend and rescind rules and regulations relating to
the Plan, including, without limitation, any rules
which the Committee determines are necessary or
appropriate to ensure that the Company, each
Participating Company and the Plan will be able to
comply with all applicable provisions of any federal,
state or local law, including securities laws. All
interpretations, determinations and actions by the
Committee will be final, conclusive and binding upon
all parties. Any action of the Committee with respect
to the administration of the Plan shall be taken
pursuant to a majority vote at a meeting of the
Committee (at which members may participate by
telephone) or by the unanimous written consent of its
members.
5. Participation in the Plan
-------------------------
(a) All Non-Employee Directors shall participate in the
Plan, subject to the conditions and limitations of the
Plan, so long as they remain eligible to participate
in the Plan as set forth below.
(b) No Non-Employee Director shall be eligible for a Stock
Payment if, at the time said Stock Payment will be
made, such Non-Employee Director owns (or is deemed to
own) directly or indirectly, shares of Common Stock
representing more than five percent of the total
combined voting power of all classes of stock of the
Company. Any such Non-Employee Director shall receive
his or her Annual Retainer in cash, payable at such
time or times as may be determined by the appropriate
Participating Company's board of directors.
6. Determination of Annual Retainers and Stock Payments
----------------------------------------------------
(a) The Board shall determine the Annual Retainer for all
Non-Employee Directors of the Company. The boards of
directors of the other Participating Companies shall
determine the Annual Retainer for their respective
Non-Employee Directors.
(b) Each director of one or more Participating Companies
who is a Non-Employee Director at any time during a
Plan Year shall receive a Stock Payment as a portion
of the Annual Retainer payable to such director. The
Stock Payment shall be made on the first business day
following (i) the Company's Annual Meeting of
Shareholders held during such Plan Year or (ii) such
later date during the Plan Year that the director is
elected or appointed to the board of directors of a
Participating Company or becomes a Non-Employee
Director. The number of shares to be issued to each
Participant as a Stock Payment shall be determined by
dividing the Market Price into two-thirds of the
Annual Retainer payable to such Participant;
PROVIDED, HOWEVER, that no fractional shares shall be
issued. The Market Price of Common Stock issued by
the Company under the Plan shall be the average daily
high and low sale prices of the Common Stock as
reported in the consolidated transaction reporting
system for all trading days during the calendar month
preceding the date the Stock Payment is made. The
Market Price for shares purchased on the open market
shall be that amount actually paid for the purchase of
such stock, excluding any brokerage commissions and
related fees. Certificates evidencing the shares of
Common Stock constituting Stock Payments shall be
registered in the respective names of, or as directed
by, the Participants and shall be issued, together
with a cash payment for any fractional share, to each
Participant. The cash portion of the Annual Retainer
shall be paid to Non-Employee Directors at such times
and in such manner as may be determined by the
respective boards of the Participating Companies.
(c) No Non-Employee Director shall be required to forfeit
or otherwise return any shares of Common Stock issued
to him or her as a Stock Payment pursuant to the Plan
(including any shares of Common Stock received as a
result of an election under Section 7) notwithstanding
any change in status of such Non-Employee Director
which renders him or her ineligible to continue as a
Participant in the Plan.
7. Election to Increase Amount of Stock Payment
--------------------------------------------
In lieu of receiving the cash portion of his or her Annual
Retainer, a Participant may make a written election to reduce the
cash portion of such Annual Retainer by a specified percentage or
dollar amount and have such amount applied to purchase additional
shares of Common Stock of the Company. To the extent the Plan
remains governed by old Rule 16b-3 (as in effect until May 1,
1991, as extended), each Non-Employee Director may make a one-
time only irrevocable election to reduce the Annual Retainer and
purchase additional shares of Common Stock. To the extent the
Plan becomes governed by new Rule 16b-3 (as effective May 1,
1991), or any successor provision, each Non-Employee Director may
make an annual election as set forth in the following paragraph.
The election shall be made on a form provided by the
Committee and must be returned to the Committee prior to the
earlier of (i) six months prior to the Annual Meeting of
Shareholders of the Company or (ii) the first day of the Plan
Year to which the election relates. The election form shall
state the amount by which the Participant desires to reduce the
cash portion of his or her Annual Retainer, which shall be
applied toward the purchase of Common Stock on the same date that
the Stock Payment is made; PROVIDED, HOWEVER, that no fractional
shares may be purchased. Any funds withheld but not able to be
applied to the purchase of whole shares shall be paid to the
Participant in cash. No Participant shall be allowed to change
or revoke any election for the relevant year, but may change his
or her election for any subsequent Plan Year.
8. Shareholder Rights
------------------
Non-Employee Directors shall not be deemed for any purpose
to be or have rights as shareholders of the Company with respect
to any shares of Common Stock except as and when such shares are
issued and then only from the date of the certificate therefor.
No adjustment shall be made for dividends or distributions or
other rights for which the record date precedes the date of such
stock certificate.
9. Adjustment For Changes in Capitalization
----------------------------------------
If the outstanding shares of Common Stock of the Company are
increased, 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, reorganization or recapitalization,
reclassification, stock dividend, stock split, reverse stock
split, combinations of shares, rights offering, distribution of
assets or other distribution with respect to such shares of
Common Stock or other securities or other change in the corporate
structure or shares of Common Stock, the maximum number of shares
and/or the kind of shares that may be issued under the Plan may
be appropriately adjusted by the Committee. Any determination by
the Committee as to any such adjustment will be final, binding
and conclusive. The maximum number of shares issuable under the
Plan as a result of any such adjustment shall be rounded down to
the nearest whole share.
10. Continuation of Directors in Same Status
----------------------------------------
Nothing in the Plan or in any instrument executed pursuant
to the Plan or any action taken pursuant to the Plan shall be
construed as creating or constituting evidence of any agreement
or understanding, express or implied, that the Company or any
other Participating Company, as the case may be, will retain a
Non-Employee Director as a director or in any other capacity for
any period of time or at a particular retainer or other rate of
compensation, as conferring upon any Participant any legal or
other right to continue as a director or in any other capacity,
or as limiting, interfering with or otherwise affecting the right
of a Participating Company to terminate a Participant in his or
her capacity as a director or otherwise at any time for any
reason, with or without cause, and without regard to the effect
that such termination might have upon him or her as a Participant
under the Plan.
11. Compliance with Government Regulations
--------------------------------------
Neither the Plan nor the Company shall be obligated to issue
any shares of Common Stock pursuant to the Plan at any time
unless and until all applicable requirements imposed by any
federal and state securities and other laws, rules and
regulations, by any regulatory agencies or by any stock exchanges
upon which the Common Stock may be listed have been fully met.
As a condition precedent to any issuance of shares of Common
Stock and delivery of certificates evidencing such shares
pursuant to the Plan, the Board or the Committee may require a
Participant to take any such action and to make any such
covenants, agreements and representations as the Board or the
Committee, as the case may be, in its discretion deems necessary
or advisable to ensure compliance with such requirements. The
Company shall in no event be obligated to register the shares of
Common Stock deliverable under the Plan pursuant to the
Securities Act of 1933, as amended, or to qualify or register
such shares under any securities laws of any state upon their
issuance under the Plan or at any time thereafter, or to take any
other action in order to cause the issuance and delivery of such
shares under the Plan or any subsequent offer, sale or other
transfer of such shares to comply with any such law, regulation
or requirement. Participants are responsible for complying with
all applicable federal and state securities and other laws, rules
and regulations in connection with any offer, sale or other
transfer of the shares of Common Stock issued under the Plan or
any interest therein including, without limitation, compliance
with the registration requirements of the Securities Act of 1933,
as amended (unless an exemption therefrom is available), or with
the provisions of Rule 144 promulgated thereunder, if available,
or any successor provisions.
12. Nontransferability of Rights
----------------------------
No Participant shall have the right to assign the right to
receive any Stock Payment or any other right or interest under
the Plan, contingent or otherwise, or to cause or permit any
encumbrance, pledge or charge of any nature to be imposed on any
such Stock Payment (prior to the issuance of stock certificates
evidencing such Stock Payment) or any such right or interest.
13. Amendment and Termination of Plan
---------------------------------
(a) The Board will have the power, in its discretion, to
amend, suspend or terminate the Plan at any time;
provided that no amendment which requires shareholder
approval in order for the Plan to continue to comply
with Rule 16b-3 under the Exchange Act, including any
successor to such Rule, shall be effective unless such
amendment shall be approved by the requisite vote of
the shareholders of the Company entitled to vote
thereon.
(b) No amendment, suspension or termination of the Plan
will, without the consent of the Participant, alter,
terminate, impair or adversely affect any right or
obligations under any Stock Payment previously granted
under the Plan to such Participant, unless such
amendment, suspension or termination is required by
applicable law.
(c) Notwithstanding the foregoing, any provision of the
Plan that either states the amount and price of
securities to be issued under the Plan and specifies
the price and timing of such issuances, or sets forth
a formula that determines the amount, price and timing
of such issuances, shall not be amended more than once
every six months, other than to comport with changes
in the Internal Revenue Code, the Employee Retirement
Income Security Act, or the rules thereunder.
14. Election to Defer Receipt of Stock Payment
------------------------------------------
(a) In lieu of receiving the Stock Payment, a Participant
may make a written election to defer receipt of the
Stock Payment until he or she ceases to be a Non-
Employee Director of the Company or of any Subsidiary
or until such other date as shall be on the election
form and approved by the Committee. The election
shall be made on a form provided by the Committee and
must be returned to the Committee prior to the earlier
of (i) six months prior to the Annual Meeting of
Shareholders of the Company or (ii) the first day of
the Plan Year to which the election relates. No
Participant shall be allowed to change or revoke any
election for a current year, but may change his or her
election for any subsequent Plan Year.
(b) A Participant who has elected to defer the receipt of
a Stock Payment (i) shall be an unsecured creditor of
the Company with respect to the amount of the deferral
and not a shareholder of the Company with respect to
the shares of Common Stock which have been deferred
and (ii) shall not be entitled to cash dividends or
the right to vote such shares. However, for each Plan
Year during which the Participant has outstanding a
deferral election, the Company shall pay to such
Participant, as additional compensation and not as a
dividend, the amount of any cash dividends which would
have been paid to such Participant had he or she
currently been the owner of the number of shares of
Common Stock which, during such Plan Year, are subject
to such deferral election.
(c) A Participant may file with the Committee a written
designation of a beneficiary or beneficiaries (subject
to such limitations as to the classes and number of
beneficiaries and contingent beneficiaries and such
other related limitations as the Committee from time
to time may prescribe) to receive, in the event of the
death of such Participant, undelivered shares of
Common Stock. A Participant may from time to time
revoke or change any such beneficiary designation.
Any designation of beneficiary under the Plan shall be
controlling as to the disposition of such shares;
PROVIDED, HOWEVER, that if the Committee shall be in
doubt as to the genuine nature of the beneficiary
designation, the competence of the Participant at the
time the designation is made or the legal right of the
designated beneficiary to receive any such shares,
such shares may be delivered to the legal
representative(s) of the Participant's estate, in
which case the Company, the Committee (and the members
of the Committee, individually) shall not be under any
further liability to any person or party.
(d) In the event of any change in capitalization described
in Section 9, such adjustment shall be made in the
number and class of Shares which may be delivered on a
deferred basis pursuant to this Section 14 as may be
determined to be appropriate and equitable by the
Committee, in its sole discretion, to prevent dilution
or enlargement of rights; PROVIDED, HOWEVER, that the
number of Shares shall always be a whole number.
15. Successors
----------
All obligations of the Company under the Plan shall be
binding on any successor to the Company, whether the existence of
such successor is the result of a direct or indirect purchase,
merger, consolidation or otherwise, of all or substantially all
of the business and/or assets of the Company.
16. Severability
------------
In the event any provision of the Plan shall be held illegal
or invalid for any reason, the illegality or invalidity shall not
affect the remaining parts of the Plan, and the Plan shall be
construed and enforced as if the illegal or invalid provision had
not been included.
17. Governing Law
-------------
To the extent not preempted by Federal law, the Plan shall
be construed in accordance with, and governed by, the laws of the
State of Washington.
Exhibit 23
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this
Registration Statement of The Washington Water Power Company on
Form S-8 of our report dated January 26, 1996 (March 1, 1996, as
to Note 15), appearing in the Annual Report on Form 10-K of The
Washington Water Power Company for the year ended December 31,
1995, and to the reference to us under the heading "Interests of
Named Experts and Counsel", which is part of this Registration
Statement.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Seattle, Washington
May 13, 1996