**IDAHOPOWER COMPANY**

**EXECUTIVEDEFERRED COMPENSATION PLAN**

**EffectiveNovember 15, 2000**

 

 

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**TABLE OF CONTENTS**

Page

TABLEOF CONTENTS............................................................................................................... i

SECTION1 DEFINITIONS.......................................................................................................... 1

 

1.1       "Account"                                                                                                                1

1.2       “Affiliate”...................................................................................................  ......... 1

1.3       “Beneficiary”.................................................................................................  ...... 1

1.4       “Board”........................................................................................................... ..... 1

1.5       “Change-in-Control”..........................................................................................  ... 1

1.6       “Code”............................................................................................................... .. 4

1.7       “Committee”........................................................................................................ . 4

1.8       “Company”..........................................................................................................   4

1.9       “DeferrableCompensation”...........   ...................................................................... 4

1.10    “Deferral Election”...........................  .................................................................... 4

1.11    “Disability”.........................................  .................................................................. 4

1.12    “Employer”...........................................  ............................................................... 5

1.13    “Event of Maturity”.................................  ............................................................. 5

1.14    “Participant”............................................. ............................................................ 5

1.15    “Plan”................................................................................................................... 5

1.16    “Plan Year”............................................... ........................................................... 5

1.17    “Pre-2005 Account”.................................... ......................................................... 5

1.18    “Post-2004 Account”.................................... ........................................................ 5

1.19    “Separation from Service”..............................  ...................................................... 5

1.20    “Subsidiary”.....................................................  ................................................... 5

1.21    “Termination of Employment”.............................   ................................................ 5

1.22     “Trust”................................................................................................................. 6

SECTION2 ADMINISTRATION............................................................................................... 6

2.1       Administration...................................................................................................... 6

2.2       Rulesand Regulations........................................... ............................................... 6

2.3       Booksand Records............................................................................................... 7

2.4       Liability................................................................................................................ 7

2.5       Conflictof Interest................................................. .............................................. 7

2.6       Committee............................................................................................................ 7

SECTION3 ELIGIBILITY; DEFERRAL ELECTION................................................................. 8

3.1       Eligibility.............................................................................................................. 8

3.2       Limitationon Participation........................................ ............................................ 8

3.3       Deferral Elections and Limit on AmountDeferred......   ......................................... 8

3.3.1    Initial Deferral Election.................................... ........................................ 8

3.3.2    Deferral Elections for Subsequent Years............ ...................................... 9

3.3.3    Timing of Deferral Elections............................... ..................................... 9

3.3.4    Payroll Deductions.................................................................................. 10

3.3.5    FICA Taxes........................................................................................... 10

3.3.6    NoSpousal Rights...............................................  ................................. 10

3.4       Part-YearParticipation....................................................................................... 10

3.5       Terminationof Participation................................................................................. 10

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3.6       Cancellationof 2005 Deferral Election................................................................ 10

3.7       2008 Transition Relief Elections.......................................................................... 10

SECTION4 DEFERRED COMPENSATION ACCOUNT; TRUST.......................................... 11

4.1       Pre-2005Account and Post-2004 Accounts......................................................... 11

4.2       Deemed Investment Options............................................................................... 11

4.2.1    Valuation of Assets................................................................................ 11

4.2.2    DeemedInvestment Elections................................................................. 11

4.3       Funding of Plan.................................................................................................. 11

4.3.1    Unfunded Obligation.............................................................................. 11

4.3.2    Establishmentof Trust............................................................................ 12

4.4       Assumption of Risk............................................................................................ 12

SECTION5 PAYMENT AMOUNT, TIME AND MANNER OF PAYMENT........................... 12

5.1       PaymentAmount................................................................................................ 12

5.2       Maturity.............................................................................................................. 12

5.2.1    Participant’s Pre-2005 Account................................................................ 12

5.2.2    Participant’s Post-2004 Account............................................................... 13

5.3       Time and Form of Payments................................................................................ 13

5.3.1    Participant’s Pre-2005 Account................................................................ 13

5.3.2    Participant’s Post-2004 Account............................................................... 13

5.3.3    New Designation of Form of Payment of aParticipant’s Pre-2005 Account    14

5.3.4    New Designation of Form of Payment of aParticipant’s Post-2004 Account  14

5.3.5    CodeSection 162(m) Delay...................................................................... 15

5.4       Determinationof Annual Installment Amounts...............................    .................... 15

5.5       Default............................................................................................ ................... 15

5.6       Withholding.......................................................................................................... 15

SECTION6 DEATH OR DISABILITY...................................................................................... 16

6.1       Payment.............................................................................................................. 16

6.2       Death.................................................................................................................. 16

6.3       Beneficiaries........................................................................................................ 16

6.4       BeneficiaryDesignation..................................................................... .................. 16

6.5       Disclaimersby Beneficiaries............................................................... ................. 16

6.6       SpecialRules....................................................................................................... 17

6.7       SurvivingSpouse and Installment Payments..........................................  ............... 18

6.8       Disability............................................................................................................. 18

SECTION7 WITHDRAWALS ................................................................................................. 18

7.1       Hardship Withdrawals.......................................................................................... 18

7.1.1    Financial Hardship.................................................................................... 18

7.1.2    Withdrawal Applications............................................................ .............. 19

7.1.3    Limitations................................................................................. ............. 19

7.2       Early Distribution................................................................................................. 19

SECTION8 AMENDMENT; TERMINATION.......................................................................... 19

8.1       Amendmentand Termination Generally.....................................................  .......... 19

8.2       Before a Change-in-Control.................................................................................. 20

8.2.1    Participants Who Have Experienced a Separationfrom Service........    ....... 20

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8.2.2    Other Participants..................................................................................... 20

8.2.3 NoAcceleration........................................................................................... 20

8.3       After a Change-in-Control................................................................................ .... 20

8.3.1    Existing Participants.................................................................................. 21

8.3.2    NewParticipants....................................................................................... 21

8.4       NoOral Amendments........................................................................................... 20

8.5       PlanBinding on Successors............................................................................... ... 21

8.6       Payment............................................................................................................... 21

SECTION9 CLAIMS PROCEDURE.......................................................................................... 21

9.1       InitialClaim.......................................................................................................... 21

9.2       Denial.................................................................................................................. 21

9.3       Time.................................................................................................................... 21

9.4       Appeal................................................................................................................. 22

9.5       Final Decision..................................................................................................... . 22

SECTION10 GENERAL PROVISIONS..................................................................................... 22

10.1    Attorneys’ Fees.................................................................................................... 22

10.2    Notices................................................................................................................. 22

10.3    Nontransferability; Spendthrift Provisions..........    .................................................. 22

10.4    Not an Employment Contract...............................  ................................................ 22

10.5    Successors............................................................................................................ 22

10.6    Incompetence....................................................................................................... 22

10.7     Expenses.............................................................................................................. 23

10.8    Governing Law..................................................................................................... 23

10.9    Unsecured General Creditor................................... .............................................. 23

10.10   Construction........................................................... ............................................. 23

10.10.1      ERISAStatus ..................................................................................   23

10.10.2      IRCStatus.........................................................................................  23

10.10.3     Rules of Document Construction:......................................................... 24

10.11  Effect on Other Plans........................................................................................... 24

10.12  Effective Date...................................................................................................... 24

10.13  Section 409A........................................................................................................ 24

 

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**IDAHO POWERCOMPANY**

**EXECUTIVE DEFERREDCOMPENSATION PLAN**

** **

IDAHO POWER COMPANY (“Company”)hereby establishes a nonqualified, unfunded supplemental deferred compensationplan for a select group of highly compensated employees known as the IdahoPower Company Executive Deferred Compensation Plan (“Plan”). The purposes ofthis Plan are to provide a means whereby certain amounts payable by the Companyor affiliates of the Company to a select group of management or highlycompensated employees may be deferred to some future period and to attract andretain certain executive employees of outstanding competence.

 

**SECTION 1**

**DEFINITIONS**

** **

The following words and phrases shall have the followingmeanings, unless a different meaning is plainly required by the context. Anymasculine terminology used in the Plan shall also include the feminine genderand the definition of any terms in the singular shall also include the plural.

 

1.1 “Account” means a Companyinternal bookkeeping account in the name of a Participant, representing theseparate unfunded and unsecured general obligation of the Employer, to whichshall be allocated amounts deferred by or otherwise allocated to theParticipant under this Plan, together with investment earnings, gains andlosses. 

 

1.2 “Affiliate” shall mean abusiness entity that is affiliated in ownership with the Company or an Employerand is recognized as an Affiliate by the Company for the purposes of this Plan.

 

1.3 “Beneficiary” shall mean theperson or persons designated as such by the Participant.  Each such designationshall be filed with the Company in a form acceptable to the Company and shallbecome effective only when received by the Company. Designated persons orentities shall not be considered Beneficiaries until the death of theParticipant.

 

1.4 “Board” shall mean the Board ofDirectors of the Company.

 

1.5 “Change-in-Control” shall mean,with respect to a Pre-2005 Account, any of the following events:

 

(a) the public announcement by IDACORP, Inc. or by anyperson (which shall not include the Company, any Subsidiary of the Company orany employee benefit plan of the Company or of any Subsidiary of the Company)(“Person”) that such Person, who or which, together with all Affiliates andAssociates (within the meanings ascribed to such terms in Rule 12b-2 of theSecurities Exchange Act of 1934, the “Exchange Act”) of such person, shall bethe beneficial owner of twenty percent (20%) or more of the voting stock ofIDACORP, Inc.; 

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(b) the commencement of, or afterthe first public announcement of any Person to commence, a tender or exchangeoffer the consummation of which would result in any Person becoming thebeneficial owner of voting stock aggregating thirty percent (30%) or more ofthe then outstanding voting stock of IDACORP, Inc.; 

 

(c) the announcement of anytransaction relating to IDACORP, Inc. required to be described pursuant to therequirements of Item 6(e) of Schedule 14A of Regulation 14A of the Securitiesand Exchange Commission under the Exchange Act;

 

(d) a proposed change in theconstituency of the Board of IDACORP, Inc., such that, during any period of two(2) consecutive years, individuals who at the beginning of such periodconstitute the Board of IDACORP, Inc. cease for any reason to constitute atleast a majority thereof, unless the election or nomination for election by theshareholders of IDACORP, Inc. of each new director was approved by a vote of atleast two-thirds (2/3) of the directors then still in office who were membersof the Board of IDACORP, Inc. at the beginning of the period.

 

(e) IDACORP, Inc. enters into anagreement of merger, consolidation, share exchange or similar transaction withany other corporation other than a transaction which would result in IDACORP,Inc.’s voting stock outstanding immediately prior to the consummation of suchtransaction continuing to represent (either by remaining outstanding or bybeing converted into voting stock of the surviving entity) at least two-thirds(2/3) of the combined voting power of IDACORP, Inc.’s or such survivingentity’s outstanding voting stock immediately after such transaction.

 

(f) the Board of IDACORP, Inc.approves a plan of liquidation or dissolution of the Company or IDACORP, Inc.or an agreement for the sale or disposition by the Company or IDACORP, Inc. (inone transaction or a series of transactions) of all or substantially all of theCompany’s or IDACORP, Inc.’s assets to a person or entity which is not anaffiliate of the Company or IDACORP, Inc. other than a transaction(s) for thepurpose of dividing the assets of the Company or IDACORP, Inc. into separatedistribution, transmission or generation entities or such other entities as theCompany or IDACORP, Inc. may determine. 

 

(g) Any other event which shall bedeemed by a majority of the Executive Committee of the Board of IDACORP, Inc.to constitute a “Change in Control.” 

 

(h) The acquisition of securitiesof Idaho Power Company representing more than fifty percent (50%) of thecombined voting power of Idaho Power Company’s then outstanding securities byany unrelated entity, person or group of persons acting in concert.

 

“Change-in-Control” shall mean, with respect to a Post-2004Account, any of the following events:

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(a) any person (as such term isdefined in Section 3(a)(9) of the Exchange Act and as used in Section 13(d) ofthe Exchange Act, excluding (i) IDACORP, Inc. or any Subsidiary of IDACORP,Inc., (ii) a corporation or other entity owned, directly or indirectly, by thestockholders of IDACORP, Inc. immediately prior to the transaction insubstantially the same proportions as their ownership of stock of IDACORP,Inc., (iii) an employee benefit plan (or related trust) sponsored or maintainedby IDACORP, Inc. or any Subsidiary of IDACORP, Inc. or (iv) an underwritertemporarily holding securities pursuant to an offering of such securities(“Exchange Act Person”)) is the beneficial owner (as defined in Rule 13d-3under the Exchange Act), directly or indirectly, of 20% or more of the combinedvoting power of the then outstanding voting securities eligible to votegenerally in the election of directors of IDACORP, Inc.; provided, however,that no Change in Control will be deemed to have occurred as a result of achange in ownership percentage resulting solely from an acquisition ofsecurities by IDACORP, Inc.; 

 

(b) consummation of a merger,consolidation, reorganization or share exchange, or sale of all orsubstantially all of the assets, of IDACORP, Inc. or the Company (a “QualifyingTransaction”), unless, immediately following such Qualifying Transaction, allof the following have occurred: (i) all or substantially all of the beneficialowners of IDACORP, Inc. immediately prior to such Qualifying Transactionbeneficially own in substantially the same proportions, directly or indirectly,more than 50% of the combined voting power of the then outstanding votingsecurities entitled to vote generally in the election of directors of thecorporation or other entity resulting from such Qualifying Transaction(including, without limitation, a corporation or other entity which, as aresult of such transaction, owns IDACORP, Inc. or all or substantially all ofIDACORP, Inc.’s assets either directly or through one or more subsidiaries) (asthe case may be, the “Successor Entity”), (ii) no Exchange Act Person is thebeneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly orindirectly, of 20% or more of the combined voting power of the then outstandingvoting securities eligible to vote generally in the election of directors ofthe Successor Entity and (iii) at least a majority of the members of the boardof directors of the Successor Entity are Incumbent Directors; 

 

(c) a complete liquidation ordissolution of IDACORP, Inc. or the Company; or 

 

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(d) within a 24-month period,individuals who were directors of the Board of Directors of IDACORP, Inc. (the“IDACORP Board of Directors”) immediately before such period (“IncumbentDirectors”) cease to constitute at least a majority of the directors of theIDACORP Board of Directors; provided, however, that any director who was not adirector of the IDACORP Board of Directors at the beginning of such periodshall be deemed to be an Incumbent Director if the election or nomination forelection of such director was approved by the vote of at least two-thirds ofthe directors of the IDACORP Board of Directors then still in office (i) whowere in office at the beginning of the 24-month period or (ii) whose electionor nomination for election was so approved, in each case, unless suchindividual was elected or nominated as a result of an actual or threatenedelection contest or as a result of an actual or threatened solicitation ofproxies or consents by or on behalf of any Exchange Act Person other than theIDACORP Board of Directors.

 

For avoidance of doubt,transactions for the purpose of dividing the Company’s assets into separatedistribution, transmission or generation entities or such other entities asIDACORP, Inc. or the Company may determine shall not constitute a Change inControl unless so determined by the IDACORP Board of Directors. 

 

1.6 “Code” means the InternalRevenue Code of 1986, as amended.

 

1.7 “Committee” shall mean aCommittee appointed by, or pursuant to authority of, the Board.

 

1.8 “Company” shall mean IDAHOPOWER COMPANY, an Idaho corporation, or any successor corporation.

 

1.9 “Deferrable Compensation” for aPlan Year shall mean a Participant’s base salary (prior to 401(k) and flexiblebenefit plan deductions) which would otherwise be payable to the Participant inthe Plan Year and/or any annual cash incentive award that would otherwise bepayable to the Participant in the Plan Year.  Deferrable Compensation shall notinclude fringe benefits, accrued but unused leave or vacation pay, severancepay, or other similar amounts not included in a Participant’s base salary orannual cash incentive award.

 

1.10 “Deferral Election” shall meanthe agreement executed by an eligible employee whereby an eligible employee electsto defer a portion of the applicable year’s salary and/or annual cash incentiveaward and contains such other information as is required by the Committee.  

 

1.11 “Disability” shall mean (a)with respect to Participants’ Pre-2005 Accounts, disability as that term wasused in the Plan as of October 3, 2004 and (b) with respect to Participants’Post-2004 Accounts, (i) the Participant is, by reason of any medicallydeterminable physical or mental impairment that can be expected to result indeath or can be expected to last for a continuous period of not less than 12months, receiving income replacement benefits for a period of not less thanthree months under an accident and health plan covering employees of theCompany and its Affiliates, (ii) the Participant is unable to engage in anysubstantial gainful activity by reason of any medically determinable physicalor mental impairment that can be expected to result in death or can be expectedto last for a continuous period of not less than 12 months or (iii) theParticipant is determined to be disabled under a disability insurance programmaintained by the Employer or an Affiliate, provided that such disabilityinsurance program’s definition of disability complies with the requirementscontained in Treasury Regulation Section 1.409A-3(i)(4).

 

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1.12 “Employer” shall mean theCompany and any business affiliated with the Company that employs persons whoare designated by the Board or the Committee for participation in this Plan.

 

1.13 “Event of Maturity” shall meanany of the occurrences described in Section 5.2 by reason of which aParticipant or Beneficiary may become entitled to a payment from this Plan. 

 

1.14 “Participant” shall mean anyemployee of an Employer who has been designated by the Board or the Committeeas eligible to participate in the Plan and who has executed a Deferral Electionand returned it to the Committee.

 

1.15 “Plan” shall mean the IdahoPower Company Executive Deferred Compensation Plan set forth herein and as maybe amended from time to time.

 

1.16 “Plan Year” shall mean thecalendar year, beginning on each January 1 and ending on the following December31.

 

1.17 “Pre-2005 Account” means asubaccount to which amounts were deferred for Plan Years through 2004. 

 

1.18 “Post-2004 Account” means asubaccount to which amounts are deferred for Plan Years beginning in 2005 andthereafter.

 

1.19 “Separation from Service”shall mean a “separation from service,” as that term is used in Code Section409A(a)(2)(A)(i).

 

1.20 “Subsidiary” shall mean anycorporation of which more than 50% of the outstanding stock having ordinaryvoting power to elect a majority of the board of directors of such corporationis now or hereafter owned, directly or indirectly, by the respective entity.

 

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1.21 “Termination of Employment”shall mean a complete severance of an employee’s employment relationship withthe Employers and all Affiliates, if any, for any reason other than theemployee’s death. Retirement constitutes a Termination of Employment. Atransfer from employment with an Employer to employment with an Affiliate of anEmployer shall not constitute a Termination of Employment. A decision by theCommittee not to select a Participant for participation for a subsequent Planyear shall not constitute a Termination of Employment. If an Employer who is anAffiliate ceases to be an Affiliate because of a sale of substantially all ofthe stock or assets of the Employer, then Participants who are employed by thatEmployer and who cease to be employed by the Company or an Employer on accountof the sale of substantially all the stock or assets of the Employer shall bedeemed to have thereby had a Termination of Employment for the purpose ofcommencing payments from this Plan.  For avoidance of doubt, it is intendedthat the foregoing definition apply only with respect to a Participant’sPre-2005 Account.  Notwithstanding anything contained in the Plan, a DeferralElection document or any other document to the contrary, with respect to anypayments or benefits under the Plan that are subject to Code Section 409A andthat could be paid due to a termination of employment, references totermination of the Participant’s employment shall be interpreted to mean theParticipant’s Separation from Service.

 

1.22 “Trust” shall mean the trustdescribed in Section 4.3. The Trust shall constitute an unfunded arrangementand shall not affect the status of the Plan as an unfunded plan. Participantsand their beneficiaries shall have no beneficial ownership interest in anyassets of any such Trust.

 

**SECTION 2**

**ADMINISTRATION**

** **

2.1 Administration. ThisPlan shall be administered by the Committee. The Committee shall have fulldiscretionary power and authority to administer and interpret the Plan,determine all factual and legal questions under the Plan, including but notlimited to eligibility and the amount of benefits, maintain records, determinedeemed investment sources and generally be responsible for seeing that thepurposes of the Plan are accomplished.  Determinations by the Committee shallbe final and binding on all parties with respect to all matters relating to thePlan unless overridden by action of the Board. The Committee may from time totime adopt such rules and procedures as it deems appropriate to assist in theadministration of the Plan. The Committee may delegate all or part of itsadministrative duties to one or more persons, whether or not such persons aremembers of the Committee or employees of the Company.

 

2.2 Rules and Regulations.The following general rules will apply to the administration of the Plan:

 

(a) No inquiry or question shallbe deemed to be a claim or a request for a review of a denied claim unless madein accordance with the claims procedure. The Committee may require that anyclaim for benefits and any request for a review of a denied claim be filed onforms to be furnished by the Committee upon request. 

 

(b) All decisions on claims and onrequests for a review of denied claims shall be made by the Committee.

 

(c) The Plan Committee may, in itsdiscretion, hold one or more hearings on a claim or a request for a review of adenied claim. 

 

(d) A claimant may be representedby a lawyer or other representative (at the claimant’s own expense), but thePlan Committee reserves the right to require the claimant to furnish writtenauthorization. A claimant’s representative shall be entitled, upon request, tocopies of all notices given to the claimant.

 

(e) The decision of the Committeeon a claim and on a request for a review of a denied claim shall be provided tothe claimant in writing. If a decision or notice is not received by a claimantwithin the time specified, the claim or request for a review of a denied claimshall be deemed to have been denied. 

 

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(f) Prior to filing a claim or arequest for a review of a denied claim, the claimant or his or herrepresentative shall have a reasonable opportunity to review a copy of the Planand all other pertinent documents in the possession of the Company. 

 

(g) The Committee may permanentlyor temporarily delegate its responsibilities under this claims procedure to anindividual or a committee of individuals. 

 

2.3 Books and Records. TheCommittee shall maintain records of each Participant’s Pre-2005 Account balanceand Post-2004 Account balance. A Participant shall not be entitled to examine,audit or otherwise have access to any financial statements, bookkeeping recordsor other records of account pertaining to the Employer or the Plan under anycircumstances whatsoever.

 

2.4 Liability. No member ofthe Committee and no director, officer or member of the Board of the Company orits affiliates shall be liable to any persons for any actions taken under thePlan, or for any failure to effect any of the objectives or purposes of thePlan, by reason of insolvency or otherwise. Neither the officers nor any memberof the Committee or the Board of Directors of the Company or any of itsaffiliates in any way secures or guarantees the payment of any benefit oramount which may become due and payable hereunder to or with respect to any Participant.Each Participant and other person entitled at any time to payments hereundershall look solely to the assets of the Company and its affiliates for suchpayments as an unsecured, general creditor. Nothing herein shall be construedto give a Participant, Beneficiary or any other person or persons any right,title, interest or claim in or to any specific asset, fund, reserve, account orproperty of any kind whatsoever owned by the Company or in which it may haveany right, title or interest now or in the future. After benefits shall havebeen paid to or with respect to a Participant and such payment purports tocover in full the benefit hereunder, such former Participant or other person orpersons, as the case may be, shall have no further right or interest in theother assets of the Company and its affiliates in connection with this Plan. 

 

2.5 Conflict of Interest. Ifany individual to whom authority has been delegated or redelegated hereundershall also be a Participant in this Plan, such Participant shall have noauthority with respect to any matter specially affecting such Participant’sindividual interest hereunder or the interest of a person superior to him orher in the organization (as distinguished from the interests of allParticipants and Beneficiaries or a broad class of Participants andBeneficiaries), all such authority being reserved exclusively to otherindividuals as the case may be, to the exclusion of such Participant, and suchParticipant shall act only in such Participant’s individual capacity inconnection with any such matter.

 

2.6 Committee. The Committeeshall be the Administrator for purposes of section 3(16)(A) of the EmployeeRetirement Income Security Act of 1974.

 

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**SECTION3**

**ELIGIBILITY;DEFERRAL ELECTION**

 

3.1 Eligibility.The Committee will designate from time to time certain key employees of anEmployer to be eligible to participate in the Plan.  In selecting eligibleemployees, the Committee shall consider the position and responsibilities ofsuch individuals, the value of their services to the Employer, and such otherfactors as the Committee deems pertinent.  The Committee may rescind itsdesignation of an eligible employee and discontinue an employee’s activeparticipation in the Plan at any time; provided, however, that such arescission shall not cause or permit the accelerated distribution of aParticipant’s Post-2004 Account or the revocation of a Participant’s DeferralElection after the deadline for making the Deferral Election, unless suchacceleration or revocation is determined to be permissible under Code Section409A.

 

3.2 Limitation on Participation.This Plan is intended to be an unfunded plan maintained primarily to providedeferred compensation benefits for a select group of “management orhighly-compensated employees” (a “top-hat group”) within the meaning ofsections 201, 301 and 401 of the Employee Retirement Income Security Act of1974 (“ERISA”), and therefore to be exempt from the provisions of Parts 2, 3and 4 of Title 1 of ERISA. Participation in the Plan shall be limited to aselect group of management or highly compensated employees (as that expressionis used in ERISA). 

 

3.3 Deferral Elections and Limiton Amount Deferred. An eligible employee may elect to participate for eachPlan Year by completing a Deferral Election in a form prescribed by theCommittee, signing it and returning it to the Committee.  A Participant may notdefer more than 50% of his or her base salary and a Participant may not defermore than 50% of his or her annual cash incentive award for the year.

 

3.3.1 InitialDeferral Election. As a condition of participation in this Plan, aneligible employee must complete such forms and make such elections as theCommittee may require for the effective administration of the Plan.  At a minimum,the Initial Deferral Election:

 

(a) shall become irrevocable onDecember 31 of the year prior to the year in which the services that give riseto the Deferrable Compensation being deferred are provided (or on such earlierdate as the Committee may prescribe).

 

(b) shall authorize the Employerto withhold from the Participant’s Deferrable Compensation for the Plan Year adesignated percentage to be deferred (but not less than $1,000 per Plan Year).

 

(c) shall designate the form ofpayment (lump sum or annual installments payable over five years), subject tothe provisions of Section 5.3 hereof. 

 

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(d) shall inform the Participantof the proper procedures, as adopted by the Committee, to designate initialdeemed investments from among the deemed investment options authorized by theCommittee in accordance with Section 4.2 hereof.

 

Only one form of payment ispermitted each for a Participant’s Pre-2005 Account and a Participant’sPost-2004 Account.  Therefore the Participant’s election as to form of paymentcontained in the initial Deferral Election will apply to the Participant’sentire Pre-2005 Account, and to the Participant’s entire Post-2004 Account,including amounts deferred in subsequent years and allocated to such Post-2004Account, unless a new designation of form of payment is made in accordance withSection 5.3 hereof.  Participants may change their deemed investment electionson a prospective basis in accordance with Section 4.2.

 

3.3.2 DeferralElections for Subsequent Years. An employee who is eligible to continueparticipation in subsequent Plan Years may elect to defer compensation for aPlan Year by completing a Deferral Election in the form and manner prescribedby the Committee. At a minimum such Deferral Election:

 

(a) shall become irrevocable onDecember 31 of the year prior to the year in which the services that give riseto the Deferrable Compensation being deferred are provided (or on such earlierdate as the Committee may prescribe).

 

(b) shall authorize the Employerto withhold from the Participant’s Deferrable Compensation for the Plan Year adesignated percentage to be deferred (but not less than $1,000 per Plan Year).

 

(c) shall designate the form ofpayment (lump sum or annual installments payable over five years), subject tothe provisions of Section 5.3 hereof.

 

3.3.3 Timing ofDeferral Elections. With the exception of part-year participation asprovided in Section 3.4 or deferral of performance-based compensation asprovided in the following sentence, a Deferral Election must be returned byDecember 1 of the year prior to the Plan Year in which the services that giverise to the Deferrable Compensation are provided.  With respect to deferrals ofannual cash incentive awards that constitute performance-based compensation forpurposes of Code Section 409A, the Committee may permit a Deferral Election tobe returned on or before the date that is six (6) months before the end of theperformance period, provided that in no event may a Participant defer aperformance-based annual cash incentive award after the compensation beingdeferred has become “readily ascertainable” (as that term is used in TreasuryRegulation Section 1.409A-2(a)(8)) and the Participant must have providedservices continuously from the later of (i) the beginning of the performanceperiod and (ii) the date the performance criteria are established through thedate the Deferral Election is made.

 

3.3.4 PayrollDeductions. Each Deferral Election will authorize the Employer to withholda percentage (in whole numbers) of a Participant’s Deferrable Compensation fora Plan Year. 

 

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3.3.5 FICATaxes. Amounts due for FICA taxes on the amounts deferred will be withheldfrom the Participant’s remaining Deferrable Compensation.

 

3.3.6 NoSpousal Rights. No spouse, former spouse, Beneficiary, or other personshall have any right to participate in the Participant’s designation of theamount to be deferred, the deemed investments, the form of payment, or the timeof payment. 

 

3.4 Part-Year Participation.In the event an employee first becomes eligible to participate during a PlanYear and wishes to defer a portion of Deferrable Compensation for such calendaryear, a Deferral Election must be submitted to the Committee no later thanthirty (30) days after the date the employee becomes eligible to participate. Such Deferral Election will be effective only with respect to base salary forservices to be performed by the Participant following the submission of theDeferral Election to the Committee.

 

3.5 Termination ofParticipation. A person shall cease to be a Participant as soon as allamounts credited to the Participant’s Account have been paid in full. 

 

3.6 Cancellation of 2005Deferral Election. Notwithstanding the provisions of Subsections 3.3.1(a)and 3.3.2(a), a Participant who has made an election to defer for the 2005calendar year may, at any time prior to December 31, 2005, cancel suchelection.

 

3.7 2008 Transition ReliefElections. Notwithstanding anything contained in the Plan to the contrary,the Committee may allow Participants to change the time or form of distributionof their Post-2004 Accounts in 2008 pursuant to transition relief electionspermitted under Code Section 409A, provided (a) such elections are made in 2008and (b) such elections do not cause (i) amounts that would have beendistributed after 2008 to be distributed in 2008 or (ii) amounts that wouldhave been distributed in 2008 to be distributed after 2008.

 

**SECTION4**

**DEFERREDCOMPENSATION ACCOUNT; TRUST**

** **

4.1 Pre-2005 Account andPost-2004 Accounts. Amounts deferred by a Participant under the Plan priorto January 1, 2005 are reflected in the Participant’s Pre-2005 Account. Amounts deferred by a Participant under the Plan after December 31, 2004 arereflected in the Participant’s Post-2004 Account. Deferred amounts are creditedas of a date determined by the Committee. An amount equal to the amountdeferred may be contributed in cash by the Employer to the Trust referenced inSubsection 4.3.2 hereof. A Participant’s Pre-2005 Account balance, if any, andPost-2004 Account balance, if any, shall be subject to adjustments pursuant toSection 4.2.

 

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4.2 Deemed Investment Options.From time to time, the Committee will designate the deemed investment optionsavailable under the Plan, and the procedures for Participants to make or changedeemed investment elections. Initially the deemed investment options will beall of the investments permitted under the Idaho Power Company Employee SavingsPlan (“Employee Savings Plan”). The Committee may change the deemed investmentoptions on a prospective basis at any time. A Participant’s Account balancewill be adjusted each business day the New York Stock Exchange is open forbusiness for earnings, gains and losses as if it were invested in the deemedinvestments elected by the Participant.

 

4.2.1 Valuationof Assets. The market value of the assets that would have been held in eachof the deemed investments shall be determined by the Committee in accordancewith generally accepted valuation principles, consistently applied. In makingadjustments to a Participant’s Account and determining the value of assets forpurposes of such adjustments, the Committee shall use methods that arecomparable to those used in adjusting accounts and the valuation of assetsunder the Employee Savings Plan, including the extent to which expenses andother charges are taken into account in making such valuations. The amountpayable to a Participant or his Beneficiary pursuant to Sections 6.3, 6.4, or6.5 shall be equal to the Participant’s Account balance on the date of theEvent of Maturity giving rise to a distribution of the Participant’s Account. 

 

4.2.2 DeemedInvestment Elections. A Participant may elect deemed investments, andallocate how his or her Account shall be allocated among such deemed investmentsin accordance with procedures adopted by the Committee for making or changingthe selection of deemed investments. Such procedures may include election viaan interactive voice response (“IVR”) system or elections transmittedelectronically. If the Participant has not made a deemed investment election, aParticipant’s Account balance will be adjusted as determined by the Committeein its sole discretion.

 

4.3 Funding of Plan.

 

4.3.1 UnfundedObligation. The obligation of the Employers to make payments under thisPlan constitutes only the unsecured (but legally enforceable) promise of theEmployers to make such payments. The Participants shall have no lien, priorclaim or other security interest in any property of the Employers. Except asprovided in Section 4.3.2, the Employers are not required to establish ormaintain any fund, trust or account (other than a bookkeeping account orreserve) for the purpose of funding or paying the benefits promised under thisPlan. If such a fund is established, the property therein shall remain the soleand exclusive property of the Employers. The Employers will pay the cost ofthis Plan out of their general assets. All references to accounts, accruals,gains, losses, income, expenses, payments, custodial funds and the like areincluded merely for the purpose of measuring the Employers’ obligation toParticipants in this Plan and shall not be construed to impose on the Employersthe obligation to create any separate fund for purposes of this Plan.

 

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4.3.2 Establishmentof Trust. In order to provide assets from which to fulfill its obligationsto the Participants and their beneficiaries under the Plan, the Company shallestablish a Trust by a trust agreement with a third party (the “Trustee”) towhich the Employers may, in their discretion, contribute cash or other propertyto provide for the benefit payments under the Plan. The Trust shall be agrantor trust for tax purposes. The Trustee will have the duty to invest theTrust assets and funds in accordance with the terms of the Trust. The Employersshall be entitled at any time, and from time to time, in their sole discretion,to substitute assets of at least equal fair market value for any assets held inthe Trust. All rights associated with the assets of the Trust will be exercisedby the Trustee or the person designated by the Trustee, and will in no event beexercisable by or rest with Participants or their beneficiaries. The Trustshall provide that any assets shall be used for the payment of benefits underthe Plan and, to the extent the assets of the Trust exceed the amountsotherwise necessary for the payment of benefits (as a result of forfeituresunder Section 7.2), the payment of administrative expenses of the Plan,provided, however, that in the event of the insolvency of the Company, theTrustee shall hold the assets for the benefit of the general creditors of theCompany and its affiliated companies.

 

4.4 Assumption of Risk. TheParticipant, by electing to make deferrals under this Plan, assumes all risk inconnection with any decrease in value of the Participant’s Account. 

** **

**SECTION 5**

**PAYMENT AMOUNT,TIME AND MANNER OF PAYMENT**

 

5.1 Payment Amount. The“Payment Amount” shall be the Participant’s Account balance as determined underSections 4.1 and 4.2 as of the date of the Event of Maturity that gave rise toa distribution of a Participant’s Account.

 

5.2 Maturity.

 

5.2.1. Participant’sPre-2005 Account. A Participant’s Pre-2005 Account shall mature and shallbecome payable in accordance with this Section 5 upon the earliest occurrenceof any of the following events while in the employment of an Employer or anAffiliate:

 

(a) the Participant’s death, or

(b) the Participant’s Terminationof Employment (including retirement), or

(c) the Participant’s Disability,or

(d) termination of this Plan.

 

5.2.2. Participant’sPost-2004 Account. A Participant’s Post-2004 Account shall mature and shallbecome payable in accordance with this Section 5 upon the earliest occurrenceof any of the following events while in the employment of Employer or anAffiliate:

 

(a) the Participant’s death, or

(b) the Participant’s Disability,or

(c) the Participant’s Separationfrom Service.

 

5.3 Time and Form of Payments.Distribution of amounts withheld pursuant to a Deferral Election, as adjustedpursuant to Section 4.2, will be made either in one lump sum or in five annualinstallments, as selected by the Participant in the Deferral Election. Unlessthe Committee provides otherwise, a Participant may select a different form ofpayment with respect to each year’s deferrals.

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5.3.1 Participant’sPre-2005 Account. Upon the occurrence of an Event of Maturity described inSection 5.2.1 effective as to a Participant, the Committee shall cause theEmployer to commence payment of such Participant’s Pre-2005 Account (reduced bythe amount of any applicable payroll, withholding or other taxes) in the formdesignated by the Participant in his or her Deferral Election. If a lump sumpayment has been elected, payment of the Participant’s Pre-2005 Account will bemade within sixty (60) days after the Event of Maturity giving rise to thedistribution. If a Participant has elected annual installments, payments willcommence in January of the year following the year in which the Event ofMaturity occurred, or if such event occurred in December, within sixty (60)days after such event.

 

5.3.2 Participant’sPost-2004 Account. Upon the occurrence of an Event of Maturity described inSection 5.2.2 effective as to a Participant, the Committee shall cause theEmployer to commence payment of such Participant’s Post-2004 Account (reducedby the amount of any applicable payroll, withholding or other taxes) in theform designated by the Participant in the Deferral Election or DeferralElections pursuant to which the amounts being distributed were deferred or, inthe event of the Participant’s death, pursuant to Section 6.2(b). If a lump sumpayment has been elected, payment of the Participant’s Post-2004 Account willbe made within sixty (60) days after the Event of Maturity giving rise to thedistribution.  Notwithstanding anything to the contrary contained in the Plan,if the Event of Maturity for a Participant is Separation from Service (notdeath or Disability) and the Participant is deemed on the date of Separation fromService to be a “specified employee” (as that term is used in Code Section409A(a)(2)(B)), as determined under IDACORP, Inc.’s policy for determiningspecified employees, payment will be made on the first business day that occursmore than six (6) months after the date of the Separation from Service, unlessthe Participant dies during such period, in which case payment will be madewithin sixty (60) days after the date of death. If a Participant has electedannual installments, payments will commence in January of the year followingthe year in which the Event of Maturity occurred.  Notwithstanding anything tothe contrary contained in the Plan, if the Event of Maturity for a Participantis Separation from Service (not death or Disability) and the Participant isdeemed on the date of Separation from Service to be a “specified employee” (asthat term is used in Code Section 409A(a)(2)(B)), as determined under IDACORP,Inc.’s policy for determining specified employees, payment will commence inJanuary of the year following the year in which the Event of Maturity occurredor, if later, the first business day that occurs more than six (6) months afterthe date of the Separation from Service, unless the Participant dies duringsuch period, in which case payment will be made in a lump sum within sixty (60)days after the date of death.  Except as provided in the preceding sentence,each annual installment will be paid in January of the appropriate year.

 

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5.3.3 NewDesignation of Form of Payment of a Participant’s Pre-2005 Account. ThisSection 5.3.3 shall apply with respect to Pre-2005 Accounts. At any time, andfrom time to time, a Participant may file with the Committee a new designationof form of payment. Each such subsequent designation shall supersede all priordesignations and shall be effective as to the Participant’s entire Account(including the portions of the Account attributable to periods before the newdesignation is filed) as if the new designation had been made in writing at thetime of his or her initial Deferral Election. Notwithstanding the foregoing,however, any new designation shall be disregarded as if it had never been filed(and the prior effective designation will be given effect) unless thedesignation:

 

(a) was filed with the Committee at least one year beforethe Event of Maturity, and

(b) was filed at least one yearafter any other prior designation (including the designation made on theInitial Deferral Election).

 

5.3.4 New Designation of Form of Paymentof a Participant’s Post-2004 Account. This Section 5.3.4 shall apply withrespect to Post-2004 Accounts. In accordance with such procedures as theCommittee may prescribe, a Participant may file with the Committee a newdesignation of time and form of payment, subject to the following conditions:

#### (a) suchnew designation will not become effective until the date that is 12 monthsafter the date on which the election is made; and

#### (b) ifthe new designation provides for a change in the time or form of payment uponor following an Event of Maturity that is a Separation from Service, the newdesignation must provide that any such payment (either the payment of a lumpsum or the commencement of installment payments) upon or following a Separationfrom Service will not occur earlier than the first business day that is five(5) years from the date payment would have been made (or, in the case ofinstallment payments, commenced) upon or following Separation from Service hadthe new election not been made.

#### Each suchsubsequent designation shall supersede all prior designations with respect tothe amount subject to the subsequent designation (including the portionsthereof attributable to periods before the new designation is filed). Any newdesignation made pursuant to this Section 5.3.4 shall be irrevocable whenreceived by the Company. A Participant may designate a new time or form ofpayment pursuant to this Section 5.3.4 more than once, provided that all suchdesignations comply with the provisions of this Section 5.3.4. It is theCompany’s intent that the provisions of this Section 5.3.4 comply with therules relating to changes in time and form of payment set forth in Code Section409A(a)(4)(C), related regulations and other applicable guidance, and thisSection 5.3.4 shall be interpreted accordingly. The Committee may imposeadditional restrictions or conditions on a Participant’s ability to designate anew time or form of payment pursuant to this Section 5.3.4. 

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5.3.5 CodeSection 162(m) Delay. This Section 5.3.5 shall apply only with respect to Post-2004Accounts. If the Committee reasonably anticipates that the Company’s deductionwith respect to a payment would be limited or eliminated by application of CodeSection 162(m) if the payment were made as scheduled, the Committee mayunilaterally delay the time of the making or commencement of payment, providedsuch payment will be made either during the first year in which the Committeereasonably anticipates (or should reasonably anticipate) that if the payment ismade during such year the deduction of the payment will not be barred byapplication of Code Section 162(m) or during the period beginning with the dateof the Separation from Service and ending on the later of the last day of theCompany’s tax year in which the Separation from Service occurs or the 15thday of the third month following the date of the Separation from Service;provided, further, that the provisions of this Section 5.3.5 shall be appliedin accordance with the rules relating to delay of payments subject to CodeSection 162(m) as contained in Treasury Regulation Section 1.409A-2(b)(7)(i).No election may be provided to the Participant with respect to the timing of apayment pursuant to this Section 5.3.5.

 

5.4 Determination of AnnualInstallment Amounts. If distributions are made in annual installments overa period of years, the amount of each annual installment will be determined bythe Committee by dividing the portion of the Participant’s Pre-2005 Accountbalance which is payable in installments, measured immediately before aninstallment payment, by the number of installments remaining to be paid, and/orby dividing the portion of the Participant’s Post-2004 Account which is payablein installments, measured immediately before an installment payment, by thenumber of installments remaining to be paid. 

 

5.5 Default. If the form ofpayment is not clearly designated in the Deferral Election, a designation of asingle lump sum payment will be deemed to have been made.

 

5.6 Withholding. The Companymay withhold from any payments any deductions required by law.

** **

**SECTION 6**

**DEATH ORDISABILITY**

** **

6.1 Payment. A Participant’sPayment Amount shall be payable under Sections 6.2 through 6.6 on theParticipant’s death or Disability regardless of the provisions of Section 5,subject to the following provisions.

 

6.2 Death. On death, thePayment Amount shall be paid as follows:

 

(a) With respect to theParticipant’s Pre-2005 Account:

 

(i) If theBeneficiary is the surviving spouse and the Participant had elected aninstallment payout, by installments, in accordance with the election, beginningin January of the year following the year of death, provided that if the deathoccurred in December, the first installment will be paid within 60 days of theParticipant’s death and the remaining annual installments will be paid inJanuary of the appropriate year.

 

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(ii) In allother cases, by a lump sum, payable within 60 days after the Participant’sdeath.

 

(b) With respect to theParticipant’s Post-2004 Account, in a lump sum, payable within 60 days afterthe Participant’s death.

 

6.3 Beneficiaries. An amountpayable on death of a Participant shall be paid to the Participant’sBeneficiary in the following order of priority:

 

(a) To the surviving Beneficiariesdesignated by the Participant in writing to the

Committee.

 

(b) To the Participant’s spouse,if living.

 

(c) To the Participant’s estate.

 

6.4 Beneficiary Designation.A Participant shall submit to the Company upon initial designation as aneligible employee in the Plan, and at such other times as the Participantdesires, on a form provided by the Committee, a written designation of thebeneficiary or beneficiaries to whom payment of the Participant’s Account underthe Plan shall be made in the event of the Participant’s death. Beneficiarydesignations shall become effective only when received by the Company.Beneficiary designations first received by the Company after the Participant’sdeath, and any designations in effect at the time a valid subsequentdesignation is received by the Company, shall be invalid and have no effect.

 

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6.5 Disclaimers byBeneficiaries. A Beneficiary entitled to a payment of all or a portion of adeceased Participant’s Account may disclaim any interest therein subject to thefollowing requirements. To be eligible to disclaim, a Beneficiary must not havereceived a payment of all or any portion of the Account at the time suchdisclaimer is executed and delivered, and, if a natural person, must haveattained legal age as of the date of the disclaimer.  Any disclaimer must be inwriting and must be executed personally by the Beneficiary before a notarypublic. A disclaimer shall state that the Beneficiary’s entire interest in theunpaid Account is disclaimed or shall specify what portion thereof isdisclaimed. To be effective, an original executed copy of the disclaimer mustbe both executed and actually delivered to the Committee after the date of theParticipant’s death but not later than nine (9) months after the date of theParticipant’s death. A disclaimer shall be irrevocable when delivered to theCommittee. A disclaimer shall be considered to be delivered to the Committeeonly when actually received by an officer of the Company or a member of theCommittee who is familiar with the affairs of the Plan. The Committee shall bethe sole judge of the content, interpretation and validity of a purporteddisclaimer. Upon the filing of a valid disclaimer, the Beneficiary shall beconsidered not to have survived the Participant as to the interest disclaimed.A disclaimer by a Beneficiary shall not be considered to be a transfer of aninterest in violation of the provisions of Section 10.3. No other form ofattempted disclaimer shall be recognized by the Committee. The foregoingrequirements are solely for the purpose of disclaiming benefits under the Planand compliance with these requirements does not assure that the disclaimer willbe valid for tax purposes or any other purposes. It is the responsibility ofthe person disclaiming to assure compliance with any and all requirements to assureproper tax treatment of the disclaimer if that is intended. 

 

6.6 Special Rules. Unlessthe Participant has otherwise specified in the Participant’s Beneficiarydesignation, the following rules shall apply:

 

(a) If there is not sufficientevidence that a Beneficiary was living at the time of the death of theParticipant, it shall be deemed that the Beneficiary was not living at the timeof the death of the Participant.

 

(b) The automatic Beneficiariesspecified in Section 6.3 and the Beneficiaries designated by the Participantshall become fixed at the time of the Participant’s death so that, if aBeneficiary survives the Participant but dies before the receipt of allpayments due such Beneficiary hereunder, such remaining payments shall bepayable to the representative of such Beneficiary’s estate.

 

(c) If the Participant designatesas a Beneficiary the person who is the Participant’s spouse on the date of thedesignation, either by name or by relationship, or both, the dissolution,annulment or other legal termination of the marriage between the Participantand such person shall automatically revoke such designation. (The foregoingshall not prevent the Participant from designating a former spouse as aBeneficiary on a form executed by the Participant and received by the Committeeafter the date of the legal termination of the marriage between the Participantand such former spouse, and during the Participant’s lifetime.)

 

(d) Any designation of a nonspouseBeneficiary by name that is accompanied by a description of relationship to theParticipant shall be given effect without regard to whether the relationship tothe Participant exists either then or at the Participant’s death.

 

(e) Any designation of aBeneficiary only by statement of relationship to the Participant shall beeffective only to designate the person or persons standing in such relationshipto the Participant at the Participant’s death. 

 

(f) A Beneficiary designation ispermanently void if it either is executed or is filed by a Participant who, atthe time of such execution or filing, is then a minor under the law of thestate of the Participant’s legal residence. The Committee shall be the solejudge of the content, interpretation and validity of a purported Beneficiarydesignation.

 

6.7 Surviving Spouse andInstallment Payments. If a surviving spouse, who is receiving installmentsfrom the Participant’s Pre-2005 Account, dies while a balance remains in theParticipant’s Pre-2005 Account, the balance shall be paid in a lump sum to thespouse’s estate.

 

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6.8 Disability. This Section6.8 shall apply with respect to Pre-2005 Accounts.  Notwithstanding anyprovisions herein to the contrary, while a Participant is receiving long-termdisability benefits under a plan sponsored by an Employer, no payments will bemade under this Plan. If disability benefits stop and disability continues, thePayment Amount shall be paid in the manner selected under Section 5.3. If theParticipant dies, the provisions applicable to death shall be followed. If theParticipant ceases to be disabled and does not resume active employment, thePayment Amount shall be paid in accordance with Section 5. For avoidance ofdoubt, this Section 6.8 shall not apply to a Participant’s Post-2004 Account. 

 

**SECTION 7**

**WITHDRAWALS**

 

7.1 Hardship Withdrawals. AParticipant may withdraw amounts from the Participant’s Pre-2005 Account andfrom the Participant’s Post-2004 Account before those amounts would otherwisehave been paid, if the Participant is employed by the Employer at the time of therequest, and if the Participant demonstrates to the satisfaction of theCommittee that the withdrawal is necessary because of an unforeseeableemergency. The withdrawal shall be limited to the amount reasonably necessaryto meet the financial hardship, including any amounts necessary to pay federal,state or local income taxes reasonably anticipated to result from the payment.

 

7.1.1 FinancialHardship. An unforeseeable emergency is a severe financial hardship of aParticipant resulting from one or more of the following causes:

 

(a) An illness or accident of theParticipant, Participant’s spouse, or dependent (as defined in Section 152(a)of the Code);

 

(b) Loss of the Participant’sproperty due to casualty (including the need to rebuild a home following damageto a home not otherwise covered by insurance); or

 

(c) Other similar extraordinaryand unforeseeable circumstances arising as a

result of events beyond thecontrol of the Participant or Beneficiary.

 

A distribution on account ofunforeseeable emergency may not be made to the extent that such emergency is ormay be relieved through reimbursement or compensation from insurance orotherwise, by liquidation of the Participant’s assets, to the extent theliquidation of such assets would not cause severe financial hardship, or bycessation of deferrals under this Plan.

 

7.1.2 WithdrawalApplications. The Committee shall establish guidelines and procedures forimplementing withdrawals. An application shall be written, be signed by theParticipant and include a statement of facts causing the financial hardship andany other facts required by the Committee.

 

7.1.3 Limitations.The withdrawal date shall be fixed by the Committee. The Committee may requirea minimum advance notice and may limit the amount, time and frequency ofwithdrawals.

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7.2 Early Distribution.Notwithstanding any other provision of the Plan, any Participant or Beneficiarymay, at any time, elect to receive an early payment of the Participant’sAccount balance, reduced by a penalty equal to ten percent (10%) of the Accountbalance as of the date of such election. The ten percent (10%) penalty shall bepermanently forfeited and shall not be paid to, or in respect of, theParticipant or Beneficiary. Any early payment under this Section 7.2 will bemade as soon as administratively feasible after the Participant’s orBeneficiary’s election. Whenever a Participant receives an early payment underthis Section 7.2, the Participant’s participation under the Plan will terminateeffective as of the date of such early payment and the Participant shall not beeligible to participate in the Plan until the third Plan Year beginning afterthe date of such early payment. An early distribution of a Participant’sPost-2004 Account balance is not permitted.

** **

**SECTION 8**

**AMENDMENT;TERMINATION**

 

8.1 Amendment and TerminationGenerally. Subject to the limitations of Sections 8.2 and 8.3, the Plan maybe amended or terminated at any time through action by the Board, or by theCommittee.  Upon termination, each Participant or Beneficiary, as the case maybe, will receive an amount equal to such Participant’s Pre-2005 Accountbalance, less any withholding obligations, as soon as practicable following thedate the Plan is terminated. Distribution of each Participant’s Pre-2005Account balance shall be made in the manner determined by the Company in itssole and absolute discretion.  To the extent consistent with the rules relatingto plan terminations and liquidations in Treasury Regulation Section1.409A-3(j)(4)(ix) or otherwise consistent with Section 409A of the Code, theBoard may provide that each Participant or Beneficiary, as the case may be,will receive an amount equal to such Participant’s Post-2004 Account balance,less any withholding obligations, upon (or as soon as is permitted following)termination of the Plan. Unless so distributed, in the event of a Plantermination, the Company shall continue to maintain the Participants’ Accountsuntil distributed pursuant to the terms of the Plan and Participants shall remain100% vested in all amounts credited to their Accounts.

 

8.2 Before a Change-in-Control.Prior to the occurrence of a Change-in-Control, the Board or Committee mayunilaterally amend the Plan prospectively, retroactively or both, at any timeand for any reason deemed sufficient by it without notice to any personaffected by this Plan and may likewise terminate this Plan both with regard topersons expecting to receive benefits in the future, subject to the following.

 

8.2.1 ParticipantsWho Have Experienced a Separation from Service. The benefit, if any,payable to or with respect to a Participant who has experienced a Separationfrom Service as of the effective date of such amendment, or the effective dateof such termination, shall not be, without the knowing and voluntary writtenconsent of the Participant, diminished or delayed by such amendment ortermination (but the Committee may amend the Plan to otherwise modify thepayment of any such benefit including, but not limited to, accelerating thepayment of all remaining payments into a single lump sum payment).

 

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8.2.2 OtherParticipants. The benefit, if any, payable to or with respect to each otherParticipant determined as if such Participant had experienced a Separation fromService on the effective date of such amendment or the effective date of suchtermination, shall not be, without the knowing and voluntary written consent ofthe Participant, diminished or delayed by such amendment or termination (butthe Committee may amend the Plan to otherwise modify the payment of any suchbenefit including, but not limited to, accelerating the payment of allremaining payments into a single lump sum payment).

 

8.2.3 NoAcceleration. Notwithstanding the provisions of Subsections 8.2.1 and8.2.2, no amendment may accelerate the payment of benefits to a Participantfrom the Participant’s Post-2004 Account.

 

8.3 After a Change-in-Control.After the occurrence of a Change-in-Control, the Committee may amend orterminate the Plan as provided in Section 8.2 but subject to the followinglimitations.

 

8.3.1 ExistingParticipants. After the occurrence of a Change-in-Control, the Board orCommittee may only amend or terminate the Plan as applied to Participants whoare Participants on the date of the Change-in-Control if:

 

(a) all benefits payable to orwith respect to persons who were Participants as of the Change-in-Control(including benefits earned before and benefits earned after theChange-in-Control) have been paid in full prior to the adoption of theamendment or the termination, or

 

(b) eighty percent (80%) of allthe Participants determined as of the date of the Change-in-Control giveknowing and voluntary written consent to such amendment or termination.

 

8.3.2 NewParticipants. After the occurrence of a Change-in-Control, as applied toParticipants who are not Participants on the date of the Change-in-Control, theBoard or Committee may unilaterally amend the Plan prospectively, retroactivelyor both, at any time and for any reason deemed sufficient by it without noticeto any person affected by this Plan and may likewise terminate this Plan.

 

8.4 No Oral Amendments. Nomodification of the terms of the Plan or termination of this Plan shall beeffective unless it is in writing and signed on behalf of the Board or Committeeby a person authorized to execute such writing. No oral representationconcerning the interpretation or effect of the Plan shall be effective to amendthe Plan nor binding on any person charged with the interpretation orapplication of the Plan.

 

8.5 Plan Binding on Successors.The Company shall require any successor (whether direct or indirect, bypurchase, merger, consolidation or otherwise to all or substantially all of thebusiness and/or assets of the Employers), by agreement, to expressly assume andagree to perform this Plan in the same manner and to the same extent that theEmployers would be required to perform it if no such succession had takenplace.

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8.6 Payment. If the InternalRevenue Service issues a final ruling that any amounts deferred under this Planwill be subject to current income tax, all amounts to which the ruling isapplicable that are in Pre-2005 Accounts shall be paid to the Participantswithin 30 days.

 

**SECTION 9**

**CLAIMS PROCEDURE**

 

9.1 Initial Claim. Anyperson claiming a benefit or requesting an interpretation, ruling orinformation under the Plan shall present the request in writing to theCommittee, which shall respond in writing as soon as practicable.

 

9.2 Denial. If the claim orrequest is denied, the written notice of denial shall state:

 

(a) The reasons for denial, withspecific reference to the Plan provisions on which the denial is based.

 

(b) A description of anyadditional materials or information required and an explanation of why it isnecessary.

 

(c) An explanation of the Plan’sclaim review procedure.

 

9.3 Time. The initial noticeof denial shall normally be given within 90 days of receipt of the claim. Ifspecial circumstances require an extension of time, the claimant shall be sonotified and the time limit shall be 180 days.

 

9.4 Appeal. Any person whoseclaim or request is denied or who has not received a response within 30 daysmay request a review by notice in writing to the Committee. The originaldecision shall be reviewed by the Committee, which may, but shall not berequired to, grant the claimant a hearing. On review, whether or not there is ahearing, the claimant may have representation, examine pertinent documents andsubmit issues and comments in writing. 

 

9.5 Final Decision. Thedecision on review shall ordinarily be made within 60 days.  If an extension oftime is required for a hearing or other special circumstances, the claimantshall be so notified and the time limit shall be 120 days. The decision shallbe in writing and shall state the reasons and the relevant plan provisions. Alldecisions on review shall be final and bind all parties concerned.

** **

**SECTION 10**

**GENERAL PROVISIONS**

 

10.1 Attorneys’ Fees. Ifsuit or action is instituted to enforce any rights under this Plan, theprevailing party may recover from the other party reasonable attorneys’ fees attrial and on any appeal.

 

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10.2 Notices.Any notice under this Plan shall be in writing and shall be effective whenactually delivered or, if mailed, when deposited as first class mail postageprepaid. Mail shall be directed to the Company at the address stated in thisPlan, to the Participant’s last known home address shown in the Company’srecords, or to such other address as a party may specify by notice to the otherparties. Notices to an Employer or the Committee shall be sent to the Company’saddress.

10.3 Nontransferability;Spendthrift Provisions. The rights of a Participant under this Plan arepersonal. Except for the limited provisions of Section 6, no interest of aParticipant or one claiming through a Participant may be directly or indirectlyassigned, alienated, pledged, transferred or encumbered and no such interestshall be subject to seizure by legal process, attachment, garnishment,execution following judgment or in any other way subjected to the claims of anycreditor.

 

10.4 Not an Employment Contract.This Plan is not and shall not be deemed to constitute a contract of employmentbetween the Employer and any employee or other person, nor shall anythingherein contained be deemed to give any employee or other person any right to beretained in an Employer’s employ or in any way limit or restrict the Employer’sright or power to discharge any employee or other person at any time and totreat him without regard to the effect which such treatment might have upon theemployee as a Participant in the Plan. 

 

10.5 Successors. Amountspayable under this Plan shall be an obligation of the Company and the Trust. Ifan Employer merges, consolidates, or otherwise reorganizes or if its businessor assets are acquired by another company, this Plan shall continue withrespect to those eligible individuals who continue in the employ of thesuccessor company. The transition of Employers shall not be considered atermination of employment for purposes of this Plan.

 

10.6 Incompetence. TheCommittee may decide that because of the mental or physical condition of aperson entitled to payments, or because of other relevant factors, it is in theperson’s best interest to make payments to others for the benefit of the personentitled to payment. In that event, the Committee may in its discretion directthose payments to be made as follows:

 

(a) To a parent or spouse or achild of legal age;

 

(b) To a legal guardian; or

 

(c) To one furnishing maintenance,support, or hospitalization.

 

10.7 Expenses. All expensesand costs in connection with the adoption and administration of the Plan andTrust will be borne by the Employers.

 

10.8 Governing Law. Exceptto the extent that federal law is controlling, the Plan shall be construed andentered in accordance with and governed by the laws of the State of Idaho.Invalidation of any one of the provisions of the Plan for any reason shall inno way affect the other provisions hereof, and all such other provisions shallremain in full force and effect.

 

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10.9 Unsecured General Creditor.Any amount allocated to a Participant’s Account balance under this Plan shallbe an unfunded, unsecured promise of the Employer to make payments in thefuture. Participants and their beneficiaries, heirs, successors and assignsshall have no legal or equitable rights, interest or claims in any property orassets of the Employer. Any and all of the Employer’s assets shall be, andremain, the general, unpledged, unrestricted assets of the Employer. TheEmployer may, but shall not be required to, establish a reserve of assets toprovide funds for payments under this Plan. Such reserve may be through a trustfund, which it is intended will be established on such terms and conditions asshall prevent taxation and Participants and Beneficiaries of any amounts heldin the reserve or credited to Account balances prior to the time payments aremade. Establishing a reserve shall have no effect on the operation of this Planor upon the status of Participants as unsecured general creditors of theEmployer. Rights to payments will not be limited to assets held in any reserve.

 

10.10 Construction.

 

10.10.1  ERISAStatus. This Plan is adopted with the understanding that it is an unfundedplan maintained primarily for the purpose of providing deferred compensationfor a select group of management or highly compensated employees as provided insection 201(2), section 301(3) and section 401(a)(1) of ERISA. Each provisionshall be interpreted and administered accordingly.

 

10.10.2  IRCStatus. This Plan is intended to be a nonqualified deferred compensationarrangement. The rules of Section 409A of the Code and the regulations andguidance issued thereunder apply to all amounts deferred after December 31,2004 under this Plan. The rules of Section 3121(v)(2) and Section 3306(r)(2) ofthe Code shall apply to this Plan.

 

10.10.3  Rulesof Document Construction:

 

(a) Age. An individual shall beconsidered to have attained a given age on such individual’s birthday for thatage (and not on the day before). Individuals born on February 29 in a leap yearshall be considered to have their birthdays on February 28 in each year that isnot a leap year.

 

(b) Compounds. The words “hereof,”“herein” or “hereunder” or other similar compounds of the word “here” shallmean and refer to the entire Plan and not to any particular paragraph orSection of the Plan unless the context clearly indicates to the contrary.

 

(c) Titles. The titles given tothe various Sections of the Plan are inserted for convenience of reference onlyand are not part of the Plan, and they shall not be considered in determiningthe purpose, meaning or intent of any provision hereof. 

 

(d) References to Laws. Areference in the Plan a statute or regulation shall be considered also to meanand refer to any subsequent amendment or replacement of that statute orregulation.

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10.11 Effect on Other Plans.This Plan shall not alter, enlarge or diminish any person’s employment rightsor obligations or rights or obligations under any other retirement plansponsored by an Employer.

 

10.12 Effective Date. ThisPlan shall be effective November 15, 2000.

 

10.13. Section 409A. It isintended that the distributions under the Plan not be subject to taxation underSection 409A of the Code and the Plan and any related Deferral Elections orother documents relating to amounts deferred under the Plan shall beinterpreted accordingly.  With respect to amounts in a Participant's Post-2004Account, to the extent the terms of the Participant’s Deferral Election (or anyother election with respect to such amounts) are inconsistent with theapplicable terms of the Plan, the terms of the Plan shall govern.  It isintended that amounts in Participants’ Pre-2005 Accounts constitutegrandfathered deferrals that are not subject to Section 409A of the Code;however, if it is determined that any such amounts are subject to Section 409Aof the Code, such amounts will be subject to the provisions in the Planrelating to Post-2004 Accounts rather than the provisions in the Plan relatingto Pre-2005 Accounts.

 

IDAHO POWER COMPANY.

 

Date: ___________________________ By:_____________________________

 

 

 

 

 

 

 

 

______________________________________________________________________________

(1)        Amendedby Idaho Power Company effective October 1, 2003 to change deadline of makingdeferral elections and to revise hardship withdrawal provision.

(2)        Amendedby Idaho Power Company effective January 1, 2005 to permit cancellations of2005 deferral elections.

(3)        Amendedby Idaho Power Company effective January 1, 2005 to establish grandfathered andnon-grandfathered accounts and to make other Section 409A-related changes.

(4)        Amendedby Idaho Power Company effective July 20, 2006 to revise the change in controldefinition for non-grandfathered accounts.

(5) Amended by Idaho Power Company effective November 20,  2008 to make Section 409A-related changes.

 

 

 

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