Section 3. Quorum. At any meeting of the shareholders, a majority of the sharesentitled to vote at such meeting represented in person or by proxy shall constitute a quorum at themeeting of shareholders. Business may be conducted once a quorum is present and may continue untiladjournment of the meeting notwithstanding the withdrawal or temporary absence of sufficient sharesto reduce the number present to less than a quorum. Unless the vote of a greater number of sharesor voting by class is required by the Articles of Incorporation or the laws of the State ofArizona, the affirmative vote of a majority of the shares represented at any meeting and entitledto vote on the subject matter shall be the act of the shareholders; provided, however, that if theshares then represented are less than required to constitute a quorum, the affirmative vote must besuch as would constitute a majority if a quorum were present; provided, further, the affirmativevote of a majority of the shares then present is sufficient in all cases to adjourn a meeting.Section 4. Adjournments. Whenever at any meeting of the shareholders, notice ofwhich shall have been duly given, a quorum shall not be present, or whenever for any other reasonit may be deemed desirable, a majority in interest of the shareholders present in person or byproxy may adjourn the meeting to another time or place. If the adjournment is for a period of nomore than thirty (30) days, no notice other than by announcement at the meeting at which theadjournment is taken need be given. If the adjournment is for more than thirty (30) days or if,after the adjournment, a new record date is fixed for the adjourned meeting, a notice of theadjourned meeting shall be given to each shareholder of record entitled to vote at the meeting. Atany such adjourned meeting at which a quorum shall be present, any business may be transacted whichmight have been transacted at the original meeting.Section 5. Organization. The Chairman of the Board or, in his absence, the Presidentor, in their absence, a Vice President shall call any meeting of the shareholders to order andshall act as Presiding Officer of such meeting. The shareholders may appoint any shareholder orthe proxy of any shareholder to act as Presiding Officer of any meeting of the shareholders in theabsence of the Chairman of the Board, the President and the Vice Presidents. The Secretary or, inthe Secretary’s absence, an Assistant Secretary, shall act as Secretary at all meetings of theshareholders; or in the absence of the Secretary and Assistant Secretaries at any meeting of theshareholders, the Presiding Officer may appoint any person to act as Secretary of such meeting.
 
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Section 6. Inspectors. At each meeting of the shareholders at which a vote by ballotis taken, unless otherwise determined at such meeting, the polls shall be opened and closed, theproxies and ballots shall be received and be taken in charge, and the validity of proxies and theacceptance or rejection of votes shall be decided by two inspectors. Such inspectors shall beappointed by the Board of Directors before the meeting, or if no such appointment shall have beenmade then by the Presiding Officer of the meeting. If for any reason any of the inspectorspreviously appointed shall fail to attend or refuse or be unable to serve, inspectors in place ofany so failing to attend or refusing or unable to serve, shall be appointed in like manner.Section 7. Voting. Each shareholder shall have such voting rights as are provided bythe Articles of Incorporation and the laws of the State of Arizona. Shareholders entitled to votemay be represented and vote by a proxy or proxies by an instrument in writing; in the event thatsuch instrument in writing shall designate two or more persons to act as proxies, a majority ofsuch persons present at the meeting, or if only one shall be present then that one, shall have andmay exercise all of the powers conferred by such written instrument upon all of the persons sodesignated, unless the authorization shall otherwise provide. In all elections for directors,voting shall be by ballot.ARTICLE IIDirectorsSection 1. Election and Term. The business and affairs of the Company shall bemanaged by a Board of Directors consisting of a number of persons, not less than one (1) nor morethan five (5), specified by resolution of the Board of Directors. Directors need not beshareholders of the Company. The directors shall be elected annually by the shareholders at theannual meeting thereof, and each director shall hold office until his successor shall be electedand qualified or until his earlier resignation or removal.
 
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Section 2. Chairman of the Board. The Board of Directors shall elect one of itsmembers as the Chairman of the Board. During the absence or incapacity of the President, he shallbe the acting President. He shall have such other powers and perform such other duties as fromtime to time the Board of Directors may prescribe. If the Board of Directors shall create anExecutive Committee, the Chairman of the Board shall be a member and the Chairman thereof.Section 3. Vacancies. Any vacancies occurring in the Board of Directors by reason ofdeath, resignation or otherwise, may be filled by the affirmative vote of the remaining directors,though not less than a quorum, or by the shareholders at any meeting thereof, and any director sochosen shall hold office until his successor shall be elected and qualified.Section 4. Meetings. The meetings of the Board of Directors shall be held at suchplace or places within or without the State of Arizona as the Board of Directors may from time totime designate.The Chairman of the Board shall preside at all meetings of the Board of Directors. In theabsence of the Chairman of the Board, the President shall preside or, in their absence, thedirectors present may elect a Chairman of the meeting.The Annual Meeting of the Board of Directors for the election of officers, the designation ofmembers of committees of the Board of Directors, and the transaction of such other business as mayproperly come before the meeting, shall be, unless otherwise noticed, the regular meeting in May ofeach year. Regular meetings of the Board of Directors shall be held at such date, time and placeas may be determined by the Board of Directors.Special meetings of the Board of Directors shall be held whenever called by the direction ofthe Chairman of the Board, the President, any two directors, or the Executive Committee.Meetings of the Board of Directors, regular or special, may be held by means of conferencetelephone or similar communications equipment by means of which all persons participating in themeeting can hear each other, and participation in such a meeting shall constitute presence inperson at such meeting.
 
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Section 5. Notice. No notice shall be required of any annual or regular meeting ofthe Board of Directors unless the place, day, or time thereof shall be other than that lastdesignated by the Board. Notice of any annual or regular meeting, when required, or of any specialmeeting of the Board of Directors shall be given to each director by letter, telegram, telephone,or personally at least twenty-four hours before the time fixed for the meeting. Such notice may bewaived by any director. Unless otherwise indicated in the notice thereof any and all business maybe transacted at a special meeting. Attendance of a director at a meeting shall constitute awaiver of notice of such meeting, except when a director attends a meeting for the express purposeof objecting to the transaction of any business because the meeting is not lawfully called orconvened.Section 6. Quorum. A majority of the Board of Directors then serving shallconstitute a quorum for the transaction of business, and any act receiving the affirmative vote ofa majority of the directors present at any meeting shall be the act of the Board of Directors.Section 7. Adjournments. Any annual, regular or special meeting of the Board ofDirectors may be adjourned from time to time by the members present whether or not a quorum shallbe present, and no notice shall be required of any adjourned meeting beyond the announcement ofsuch adjournment at the meeting.Section 8. Director Emeritus. The Board of Directors may from time to time elect oneor more individuals to serve as a Director Emeritus whose duty shall be to consult with and advisethe Board of Directors of the Company. The title of a Director Emeritus shall be honorary only andsuch title shall carry with it the right to attend and participate in discussions held during themeetings of the Board of Directors, to receive notice of such meetings and to receive suchcompensation as is from time to time determined appropriate by resolution passed by a majority voteof the Board of Directors. The rights and privileges of a Director Emeritus are expressly limitedto those described in the preceding sentence and such title shall not carry with it the right tovote at Board meetings, the right to participate on any committees established by the Board ofDirectors, or any rights, duties, privileges, liabilities or obligations otherwise associated withbeing a member of the Board of Directors.
 
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ARTICLE IIICommitteesSection 1. Executive Committee. The Board of Directors may by resolution passed by amajority of the whole Board designate two or more of their members to constitute an ExecutiveCommittee which may have and exercise, subject to such limitations, if any, as may be prescribed byresolution of the Board, the powers of the Board of Directors in the management of the business andaffairs of the Company; provided, such Executive Committee shall only act at such times as theBoard of Directors is not in session and in no case to the exclusion of the Board of Directors atany time to act as a Board upon any business of the Company; and further provided that theExecutive Committee shall not have the authority of the Board of Directors in reference to thefollowing matters: the submission to shareholders of any action that requires shareholders’authorization or approval, or the filling of vacancies on the Board of Directors or in anycommittee of the Board of Directors, or the amendment or repeal of the Bylaws, or the adoption ofnew bylaws, or the fixing of compensation of directors for serving on the Board or on any committeeof the Board of Directors.Section 2. Preferred Dividend Committee. The Board of Directors shall by resolutionpassed by a majority of the whole Board designate two or more of their members to constitute aPreferred Dividend Committee which shall have and may exercise the powers of the Board of Directorsto declare from time to time, pursuant to and upon the conditions of the Company’s RestatedArticles of Incorporation, as amended, dividends upon the Company’s Cumulative Preferred Stock (NoPar); provided that such powers of the Preferred Dividend Committee shall in no case be to theexclusion of the Board of Directors to act as a Board to declare such dividends.Section 3. Other Committees. The Board of Directors may by resolution passed by amajority of the whole Board designate two or more of their members to constitute one or more othercommittees which may have and exercise, subject to such limitations, if any, as may be prescribedby resolution of the Board, the powers of the Board of Directors in the management of the businessand affairs of the Company; provided that no such committee shall have the authority of the Boardof Directors in reference to the following matters: the submission to shareholders of any actionthat requires shareholders’ authorization or approval, or the filling of vacancies on theBoard of Directors or in any committee of the Board of Directors, or the amendment or repeal of theBylaws, or the adoption of new bylaws, or the fixing of compensation of directors for serving onthe Board or on any committee of the Board of Directors.
 
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ARTICLE IVOfficersSection 1. Number, Election and Term. The officers of the Company shall be aPresident, one or more Vice Presidents, a Secretary and a Treasurer, who shall be elected annuallyby the affirmative vote of a majority of the whole Board of Directors at the Annual Meetingthereof, and who shall hold their respective offices until their successors shall be elected andqualified. One or more of the Vice Presidents may be designated as Executive Vice President orSenior Vice President. The President shall be elected from the members of the Board. The Board ofDirectors may elect or appoint from time to time Assistant Secretaries and Assistant Treasurers whoshall hold such offices subject to the pleasure of the Board. The Board of Directors may alsoelect or appoint from time to time such other officers or assistant officers as the interest of theCompany may require, and fix their duties and terms of office. Any person may hold more than oneoffice but the offices of President and Secretary shall not be held by the same person at the sametime. Any vacancy occurring in any office may be filled by the Board of Directors. All officersor assistant officers shall be subject to removal with or without cause at any time by theaffirmative vote of a majority of the whole Board of Directors.Section 2. President. The President shall be the chief executive officer of theCompany; and subject to the control and direction of the Chairman of the Board and the Board ofDirectors, he shall have general control and management of the business and affairs of the Company,and shall perform such other duties as may from time to time be assigned to him by the Board ofDirectors or which he may be authorized or required to do by reason of any provisions of law or theBylaws of the Company.Section 3. Vice Presidents. The Vice Presidents shall perform such duties as theBoard of Directors or Executive Committee shall require, and one or more as designated by the Boardshall, during the extended absence or incapacity of the Chairman of the Board and the President,assume and perform all functions and duties which the Chairman of the Board or Presidentmight lawfully do if present and not under any incapacity.
 
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Section 4. Secretary. The Secretary shall keep a record in the proper books providedfor that purpose of meetings and proceedings of the Board of Directors, Executive Committee and theshareholders and shall record all votes of the directors, Executive Committee and shareholders in abook to be kept for that purpose. The Secretary shall notify the directors and shareholders oftheir respective meetings as required by law or the Bylaws of the Company and shall perform suchother duties as may be required by law or the Bylaws of the Company, or which may be assigned fromtime to time by the Chairman of the Board, the Board of Directors or the Executive Committee.Section 5. Assistant Secretaries. The Assistant Secretaries, if and when appointedas aforesaid, shall perform such duties as the Secretary, the Board of Directors or ExecutiveCommittee shall require, and shall, during the absence or incapacity of the Secretary, assume andperform all functions and duties which the Secretary might lawfully do if present and not under anyincapacity.Section 6. Treasurer. The Treasurer shall have charge of the funds of the Company.He shall keep full and accurate accounts of receipts and disbursements in books belonging to theCompany, and shall deposit all moneys and other valuable effects in the name and to the credit ofthe Company in such depositories as may be designated by the Board of Directors. He shall disbursethe funds of the Company as may be ordered by the Board, and shall render to the President or theBoard whenever he or it may require it, account of all his transactions as Treasurer and of thefinancial condition of the Company. In addition, when authorized and empowered by the Board ofDirectors, the Treasurer may execute in the name and on behalf of the Company any loan agreements,credit agreements and other contracts or arrangements relating to the borrowing of funds by theCompany and any contracts, purchase agreements, underwriting agreements and other agreements orarrangements relating to securities to be issued and sold, guaranteed or funded by the Company, andany and all indemnification agreements, certificates, financial statements, letters or other papersand documents (other than instruments evidencing securities of the Company, unless execution ofsuch instruments is permitted under other provisions of these Bylaws and authorized by the Board ofDirectors) required in connection with any of the foregoing.
 
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Section 7. Assistant Treasurers. The Assistant Treasurers, if and when appointed asaforesaid, shall perform such duties as the Treasurer, Board of Directors or Executive Committeeshall require, and shall, during the absence or incapacity of the Treasurer, assume and perform allfunctions and duties which the Treasurer might lawfully do if present and not under any incapacity.ARTICLE VContractsNo contract or other transaction between the Company and one or more of its directors or anyother corporation, firm, association or entity in which one or more of its directors are directorsor officers or are financially interested, shall be affected because of such relationship orinterest or because such director or directors are present at the meeting of the Board of Directorsor a committee thereof which authorizes, approves, or ratifies such contract or transaction orbecause his or their votes are counted for such purpose, if: the fact of such relationship orinterest is disclosed or known to the Board of Directors or committee which authorizes, approves orratifies the contract or transaction by a vote or consent sufficient for the purpose withoutcounting the votes or consents of such interested directors; or the fact of such relationship orinterest is disclosed or known to the shareholders entitled to vote and they authorize, approve orratify such contract or transaction by vote; or the contract or transaction is fair and reasonableto the Company at the time the contract or transaction is authorized, approved or ratified, in thelight of circumstances known to those entitled to vote thereon at that time. Common or interesteddirectors may be counted in determining the presence of a quorum at a meeting of the Board ofDirectors or a committee thereof which authorizes, approves or ratifies such contract ortransaction.ARTICLE VINegotiable InstrumentsExcept as otherwise specially provided by the Board of Directors, all checks, drafts, bills ofexchange, promissory notes and other negotiable instruments shall be signed by the Treasureror an Assistant Treasurer and countersigned by the President or a Vice President of the Company;but in no case shall any one person sign and countersign in the capacity of two officers.
 
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ARTICLE VIICapital StockSection 1. Certificates of Stock. Certificates for shares of the capital stock of theCompany shall be in such form, not inconsistent with the Articles of Incorporation, as shall beapproved by the Board of Directors. The certificates shall be signed by the President or a VicePresident and by the Secretary or an Assistant Secretary and may be sealed with the seal of theCompany or a facsimile thereof. The signatures of such President, Vice President, Secretary orAssistant Secretary of the Company may be facsimiles, engraved, lithographed, printed or otherwiseimprinted or reproduced on such certificates. In case any officer of the Company whose signature,whether facsimile or otherwise, shall have been placed upon any certificate shall cease to be suchofficer before any certificate so signed shall have been actually issued and delivered, suchcertificate may nevertheless be issued and delivered by the Company as though the person who hadsigned such certificate had not ceased to be such officer. No certificate shall be issued for anyshare of capital stock until such share is fully paid.Every certificate representing shares issued by the Company shall set forth or summarize uponthe face or back of the certificate, or shall state that the Company will furnish to anyshareholder upon request and without charge, a full statement of the designations, preferences,limitations, and relative rights of the shares of each class authorized to be issued, and thevariations in the relative rights and preferences between the shares of each series so far as thesame have been fixed and determined, and the authority of the Board of Directors to fix anddetermine the relative rights and preferences of subsequent series. In addition, each certificaterepresenting shares shall state upon the face thereof: that the Company is organized under the lawsof Arizona; the name of the person to whom issued; the number and class of shares, and thedesignation of the series, if any, which such certificate represents; and the par value of eachshare represented by such certificate or a statement that the shares are without par value.
 
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The Company may issue a new certificate for shares of stock in the place of any certificatetheretofore issued and alleged to have been lost, stolen or destroyed but the Board of Directorsmay require the owner of such lost, stolen or destroyed certificate, or his legal representative tofurnish an affidavit as to such loss, theft, or destruction and to give a bond in such form andsubstance, and with such surety or sureties, with fixed or open penalty, as it may direct toindemnify the Company, the Transfer Agent or Agents and Registrar or Registrars against any claimthat may be made on account of the alleged loss, theft or destruction of such certificate. TheBoard of Directors may adopt from time to time rules and regulations relating to lost, stolen ordestroyed certificates of the capital stock of the Company or bonds or other evidences ofindebtedness of the Company.Section 2. Transfer of Stock. All transfers of shares must be made on the books ofthe Company and be duly signed by the shareholder in person or by a duly authorized attorney ofsuch shareholder, subject to the rules and regulations of the Company relating to transfers inforce at the time. In all cases of transfers, the certificate or certificates representing theshares to be transferred, or any part thereof, must be surrendered for cancellation simultaneouslywith the making of the transfer. No new certificate shall be issued until the prior certificatehas been canceled.Section 3. Closing of Transfer Books. The Board of Directors shall have power toclose the transfer books of the Company for a period not exceeding sixty (60) days preceding thedate of any meeting of shareholders, or adjournment thereof or the payment of any dividend or otherdistribution or allotment or any rights or the entitlement of any shareholder to exercise anyrights in respect of any change, conversion or exchange of shares or for the purpose of any otherlawful action; provided, however, that in lieu of closing the transfer books as aforesaid, theBoard of Directors may fix a record date pursuant to the provisions of Article VIII hereof.Section 4. Transfer Agents and Registrars. The Company shall, if and whenever theBoard of Directors shall so determine, maintain one or more transfer offices or agencies, each incharge of a transfer agent designated by the Board of Directors, where the shares of the capitalstock of the Company shall be directly transferable, and also one or more registry offices, each incharge of a registrar designated by the Board of Directors, where such shares of stock shall beregistered, and no certificate for shares of the capital stock of theCompany, in respect of which one or more transfer agents and registrars shall have been designated,shall be valid unless countersigned by manual or facsimile signature by one of such transfer agentsand registered by one of such registrars. The same corporation may at the direction of the Boardof Directors, be both transfer agent and registrar. The Board of Directors may also make suchadditional rules and regulations as it may deem expedient concerning the issue, transfer andregistration of certificates for shares of the capital stock of the Company.
 
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ARTICLE VIIIRecord DateIn order that the Company may determine the shareholders entitled to notice of or to vote atany meeting of shareholders or any adjournment thereof, or entitled to receive payment of anydividend or other distribution or allotment of any rights, or entitled to exercise any rights inrespect of any change, conversion or exchange of shares or for the purpose of any other lawfulaction, the Board of Directors may fix, in advance, a record date, which shall not be more thanseventy (70) nor less than ten (10) days before the date of such meeting, nor more than seventy(70) days nor less than ten (10) days prior to any such other action. Only such shareholders ofrecord on the record date shall be entitled to such notice of, and to vote at such meeting, or toreceive the payment of such dividend, or to receive such allotment of rights, or to exercise suchrights, as the case may be, notwithstanding any transfer of any stock on the books of the Companyafter any such record date fixed as aforesaid.A determination of shareholders of record entitled to notice of or to vote at a meeting ofshareholders shall apply to any adjournment of the meeting; provided, however, that the Board ofDirectors may fix a new record date for the adjourned meeting and further provided that theadjournment or adjournments do not exceed thirty (30) days in the aggregate.ARTICLE IXDividendsPursuant to and upon the conditions of the Restated Articles of Incorporation, as amended,dividends upon the capital stock of the Company may be declared from time to time by the Board of Directors, in itsdiscretion, and dividends upon the Company’s Cumulative Preferred Stock (No Par) may be declaredfrom time to time by the Preferred Dividend Committee, in its discretion, and, in either case, paidby the Company, in cash or other property as permitted by law; provided that no dividend shall bedeclared and paid if the Company is or would thereby be rendered insolvent or which would diminishthe amount of its capital stock.
 
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ARTICLE XCorporate SealThe common corporate seal is, and until otherwise ordered by the Board of Directors shall be,an impression circular in form upon paper bearing the words, “Tucson Electric Power Company, Seal.”The seal shall be in the charge of the Secretary, and a duplicate of the seal may be kept andbe used by the Treasurer or by an Assistant Secretary or Assistant Treasurer.ARTICLE XIOfficesThe known and principal place of business of the Company within the State of Arizona shall be220 West Sixth Street, Tucson, Arizona, but the known place of business may be changed and otheroffices may be established and maintained in or outside of the State of Arizona at such places asthe Board of Directors may designate.ARTICLE XIIAmendmentsThese Bylaws may be altered, amended, or repealed from time to time by the affirmative vote ofa majority of the Board of Directors at any regular, special or annual meeting.
 
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