As filed with the Securities and Exchange Commission on January 20, 2000
Registration No. 333-______
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------
PINNACLE WEST CAPITAL CORPORATION
(Exact name of Registrant as specified in its charter)
ARIZONA 86-0512431
(State or other jurisdiction (I.R.S. EMPLOYER)
incorporation or organization) Identification No.)
400 EAST VAN BUREN STREET
P.O. BOX 52132,
PHOENIX, ARIZONA 85072-2132
(Address of Principal Executive Offices) (Zip Code)
THE PINNACLE WEST CAPITAL CORPORATION SAVINGS PLAN
(Full title of the Plan)
Matthew P. Feeney
SNELL & WILMER L.L.P.
One Arizona Center
Phoenix, AZ 85004-0001
(Name and Address of Agent for Service)
(602) 382-6239
(Telephone number, including area code, of agent for service)
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
======================================================================================================
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF SECURITIES TO AMOUNT TO BE OFFERING AGGREGATE OFFERING AMOUNT OF
BE REGISTERED (1) REGISTERED PRICE PER SHARE(2) PRICE(2) REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
No Par Value 2,000,000 shares $30.8125 $61,625,000 $16,269.00
======================================================================================================
</TABLE>
(1) In addition, pursuant to Rule 416(c) under the Securities Act of 1933, this
registration statement also covers an undetermined amount of interests in
the plan.
(2) Estimated solely for the purpose of calculating the amount of the
registration fee, pursuant to Rules 457(c) and 457(h) of the Securities Act
of 1933, on the basis of the average of the high and low prices for shares
of common stock on the New York Stock Exchange on January 14, 2000.
================================================================================
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.
The following documents have been filed by Pinnacle West with the
Securities and Exchange Commission pursuant to the Securities Exchange Act of
1934 and are incorporated by reference into this Registration Statement:
1. Annual Report on Form 10-K for the fiscal year ended December 31,
1998;
2. Annual Report on Form 11-K for the fiscal year ended December 31, 1998
for the Savings Plan for Employees of Arizona Public Service Company,
the Savings Plan for Union Employees of Arizona Public Service
Company, and the Savings Plan for Employees of Pinnacle West Capital
Corporation;
3. Quarterly Reports on Form 10-Q for the quarters ended March 31, 1999,
June 30, 1999, and September 30, 1999;
4. Current Reports on Form 8-K dated January 11, 1999, March 22, 1999,
May 14, 1999, August 26, 1999, September 21, 1999, and September 29,
1999;
5. The description of Pinnacle West's common stock contained in its
registration statement on Form 8-B, File No. 1-8962, as filed on July
25, 1985, except for the reference to transfer agents and registrars
for the common stock contained therein and of Pinnacle West's
Preferred Share Purchase Rights included in its registration statement
on Form 8-A, File No. 1-8962, as filed on March 31, 1989, a Form 8
Amendment thereto as filed on August 29, 1991, and a Form 8A/A thereto
as filed on April 19, 1999.
All documents subsequently filed by Pinnacle West pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, prior to the
filing of a post-effective amendment to this registration statement which
indicates that all securities offered have been sold or which deregisters all
securities then remaining unsold, shall be deemed to be incorporated by
reference in this registration statement and to be a part hereof from the date
of filing such documents. Any statement contained in a document incorporated or
deemed to be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this registration statement to the extent that a
statement contained herein or in any subsequently filed document which also is
or is deemed to be incorporated by reference herein modifies or supersedes such
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this registration
statement.
Item 4. DESCRIPTION OF SECURITIES. Not applicable.
Item 5. INTERESTS OF NAMED EXPERTS AND COUNSEL. Not applicable.
Item 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Arizona Business Corporation Act (the "ABCA") permits extensive
indemnification of present and former directors, officers, employees or agents
of an Arizona corporation, whether or not authority for such indemnification is
contained in the indemnifying corporation's articles of incorporation or bylaws.
Specific authority for indemnification of present and former directors and
officers, under certain circumstances, is contained in Article VII of Pinnacle
West's bylaws.
<PAGE>
Under the ABCA, in order for a corporation to indemnify a director or
officer, a majority of the corporation's disinterested directors, independent
legal counsel, or the shareholders must find that the conduct of the individual
to be indemnified was in good faith and that the individual reasonably believed
that the conduct was in the corporation's best interests (in the case of conduct
in an "official capacity" with the corporation) or that the conduct was at least
not opposed to the corporation's best interests (in all other cases). In the
case of any criminal proceeding, the finding must be to the effect that the
individual had no reasonable cause to believe the conduct was unlawful.
Indemnification is permitted with respect to expenses, judgments, fines, and
amounts paid in settlement by such individuals.
Indemnification under the ABCA is permissive, except in the event of a
successful defense, in which case a director or officer must be indemnified
against reasonable expenses, including attorneys' fees, incurred in connection
with the proceeding. In addition, the ABCA requires Arizona corporations to
indemnify any "outside director" (a director who is not an officer, employee, or
holder of five percent or more of any class of the corporation's stock) against
liability unless (i) the corporation's articles of incorporation limit such
indemnification, (ii) the outside director is adjudged liable in a proceeding by
or in the right of the corporation or in any other proceeding charging improper
personal benefit to the director, or (iii) a court determines, before payment to
the outside director, that the director failed to meet the standards of conduct
described in the preceding paragraph. A court may also order that an individual
be indemnified if the court finds that the individual is fairly and reasonably
entitled to indemnification in light of all of the relevant circumstances,
whether or not the individual has met the standards of conduct in this and the
preceding paragraph.
Insurance is maintained on a regular basis (and not specifically in
connection with this offering) against liabilities arising on the part of
directors and officers out of their performance in such capacities or arising on
the part of Pinnacle West out of its foregoing indemnification provisions,
subject to certain exclusions and to the policy limits.
Item 7. EXEMPTION FROM REGISTRATION CLAIMED. Not applicable.
Item 8. EXHIBITS.
Exhibit Index located at Page 6.
The registrant will submit or has submitted the plan and any amendment
thereto to the Internal Revenue Service ("IRS") in a timely manner and has made
or will make all changes required by the IRS in order to qualify the plan.
Item 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
2
<PAGE>
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
a 20 percent change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective
registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
PROVIDED, HOWEVER, that paragraphs (i) and (ii) do not apply if the registration
statement is on Form S-3, Form S-8 or Form F-3 and the information required to
be included in a post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission by the registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question of whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
3
<PAGE>
SIGNATURES
THE REGISTRANT. Pursuant to the requirements of the Securities Act of 1933,
the registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Phoenix, State of Arizona, on January 19, 2000.
PINNACLE WEST CAPITAL CORPORATION
By: William J. Post
------------------------------------------
William J. Post, President
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated. Each person whose signature appears below
hereby authorizes Chris N. Froggatt, Barbara M. Gomez and Michael V. Palmeri,
and each of them , as attorneys-in-fact, to sign in his or her name and behalf ,
individually and in each capacity designated below, and to file any amendments,
including post-effective amendments, to this registration statement.
Signature Title Date
- --------- ----- ----
William J. Post President, Chief Executive January 19, 2000
- -------------------------- Officer and Director (Principal
William J. Post Executive Officer)
Michael V. Palmeri Vice President, Finance January 19, 2000
- -------------------------- (Principal Financial Officer)
Michael V. Palmeri
Chris N. Froggatt Vice President and Controller January 19, 2000
- -------------------------- (Principal Accounting Officer)
Chris N. Froggatt
Edward N. Basha, Jr. Director January 19, 2000
- --------------------------
Edward N. Basha, Jr.
Michael L. Gallagher Director January 19, 2000
- --------------------------
Michael L. Gallagher
Pamela Grant Director January 19, 2000
- --------------------------
Pamela Grant
Roy A. Herberger, Jr. Director January 19, 2000
- --------------------------
Roy A. Herberger, Jr.
Martha O. Hesse Director January 19, 2000
- --------------------------
Martha O. Hesse
4
<PAGE>
William S. Jamieson, Jr. Director January 19, 2000
- --------------------------
William S. Jamieson, Jr.
Humberto S. Lopez Director January 19, 2000
- --------------------------
Humberto S. Lopez
Richard Snell Chairman of the Board of January 19, 2000
- -------------------------- Directors
Richard Snell
THE PLAN. Pursuant to the requirements of the Securities Act of 1933, the
Pinnacle West Capital Corporation Savings Plan has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Phoenix, State of Arizona, on January 19, 2000.
The Pinnacle West Capital Corporation Savings Plan
By: Administrative Committtee
By: Armando Flores
----------------------------------------------
Armando Flores, Chairman
5
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
4.1 Bylaws
23.1 Consent of Deloitte & Touche LLP
In addition to those Exhibits shown above, the registrant hereby incorporates
the following Exhibits pursuant to Rule 411 of Regulation C promulgated under
the Securities Act of 1933 by reference to the filings set forth below:
Previously Filed Date
Exhibit No. Description as Exhibit File No. Effective
- ----------- ----------- ---------------- -------- ---------
4.2 Amended and Restated 19.1 to September 1-8962 11/14/88
Certificate of 1988 Form 10-Q
Incorporation Report
4.3 Rights Agreement 4.1 to Form 8-K 1-8962 4/19/99
Report dated
March 22, 1999
6
BYLAWS
OF
PINNACLE WEST CAPITAL CORPORATION
(AMENDED AS OF DECEMBER 15, 1999)
I. REFERENCES; SENIORITY
1.01. REFERENCES. Any reference herein made to law will be deemed to refer
to the law of the State of Arizona, including any applicable provision or
provisions of Chapters 1-17 and Chapter 23 of Title 10, Arizona Revised Statutes
(or its successor), as at any given time in effect. Any reference herein made to
the Articles will be deemed to refer to the applicable provision or provisions
of the Articles of Incorporation of the Company, and all amendments thereto, as
at any given time on file with the Arizona Corporation Commission (this
reference to that Commission being intended to include any successor to the
incorporating and related functions being performed by that Commission at the
date of the initial adoption of these Bylaws).
1.02. SENIORITY. Except as indicated in Part X of these Bylaws, the law and
the Articles (in that order of precedence) will in all respects be considered
senior and superior to these Bylaws, with any inconsistency to be resolved in
favor of the law and the Articles (in that order of precedence), and with these
Bylaws to be deemed automatically amended from time to time to eliminate any
such inconsistency which may then exist.
1.03. SHAREHOLDERS OF RECORD. Except as otherwise required by law and
subject to any procedure established by the Company pursuant to Arizona Revised
Statutes Section 10-723 (or any comparable successor provision), the word
"shareholder" as used herein shall mean one who is a holder of record of shares
in the Company.
II. SHAREHOLDERS MEETINGS
2.01. ANNUAL MEETINGS. An annual meeting of shareholders shall be held for
the election of directors at such date, time and place, either within or without
the State of Arizona, as may be designated by resolution of the Board of
Directors from time to time. Any other proper business may be transacted at the
annual meeting. A special meeting may be called and held in lieu of an annual
meeting pursuant to the provisions of Section 2.02 below, and the same
proceedings (including the election of directors) may be conducted thereat as at
a regular meeting. Any director elected at any annual meeting, or special
meeting in lieu of an annual meeting, will continue in office until the election
of his or her successor, subject to his or her (a) earlier resignation pursuant
to Section 6.01 below, (b) removal pursuant to Section 3.13 below, or (c) death
or disqualification.
2.02. SPECIAL MEETINGS. Except as otherwise required by law, special
meetings of the shareholders may be held whenever and wherever called by the
Chairman of the Board, the President, or a majority of the Board of Directors,
but such special meetings may not be called by any other person or persons.
Business transacted at any special meeting of shareholders shall be limited to
the purposes stated in the notice.
<PAGE>
2.03. NOTICE. Notice of any meeting of the shareholders will be given as
provided by law to each shareholder entitled to vote at such meeting and, if
required by law, to each other shareholder of the Company. Any such notice may
be waived as provided by law.
2.04. RIGHT TO VOTE. For each meeting of the shareholders, the Board of
Directors will fix in advance a record date as contemplated by law, and the
shares of stock and the shareholders "entitled to vote" (as that or any similar
term is herein used) at any meeting of the shareholders will be determined as of
the applicable record date. The Secretary (or in his or her absence an Assistant
Secretary) will see to the making and production of any record of shareholders
entitled to vote or otherwise entitled to notice of shareholders meetings, in
either case which is required by law. Any voting entitlement may be exercised
through proxy, or in such other manner as specifically provided by law, in
accordance with the applicable law. In the event of contest, the burden of
proving the validity of any undated or irrevocable proxy will rest with the
person seeking to exercise the same. A telegram, cablegram, or facsimile
appearing to have been transmitted by a shareholder (or by his or her duly
authorized attorney-in-fact) or other means of voting by telephone or electronic
transmission may be accepted as a sufficiently written and executed proxy if
otherwise permitted by law.
2.05. NOTICE OF SHAREHOLDER BUSINESS AND NOMINATIONS.
(a) Annual Meetings of Shareholders. (1) Nominations of persons for
election to the Board of Directors of the Company and the
proposal of business to be considered by the shareholders may be
made at an annual meeting of shareholders only (i) pursuant to
the Company's notice of meeting (or any supplement thereto), (ii)
by or at the direction of the Board of Directors or (iii) by any
shareholder of the Company who was a shareholder at the time the
respective notice provided for in this Section 2.05 is delivered
to the Secretary of the Company, who is entitled to vote at the
meeting and who complies with the notice procedures set forth in
this Section 2.05.
(2) For nominations or other business to be properly brought
before an annual meeting by a shareholder pursuant to clause
(iii) of paragraph (a)(1) of this Section 2.05, the shareholder
must have given timely notice thereof in writing to the Secretary
of the Company and any such proposed business other than the
nominations of persons for election to the Board of Directors
must constitute a proper matter for shareholder action. To be
timely, a shareholder notice shall be delivered to the Secretary
at the principal executive offices of the Company not later than
the close of business (a) with respect to business to be brought
before the meeting, on the ninetieth day or not earlier than the
close of business on the one hundred twentieth day prior to the
first anniversary of the preceding year's annual meeting
(provided, however, that in the event that the date of the annual
meeting has been changed by more than thirty days from such
anniversary date, notice by the shareholder must be so delivered
not later than the close of business on the tenth day following
the day on which public announcement of the date of such meeting
was mailed or public
-2-
<PAGE>
disclosure of the annual meeting was made, whichever first
occurs), and (b) with respect to nominations of persons to be
elected to the Board of Directors, the one-hundred and eightieth
day prior to the date of the meeting at which the election is to
occur. In no event shall the public announcement of an
adjournment or postponement of an annual meeting commence a new
time period (or extend any time period) for the giving of a
shareholder's notice as described above. Such shareholder's
notice shall set forth: (a) as to each person whom the
shareholder proposes to nominate for election as a director, all
information relating to such person that is required to be
disclosed in solicitations of proxies for election of directors
in an election contest, or is otherwise required, in each case
pursuant to Regulation 14A under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and Rule 14a-11 thereunder
(and such person's written consent to being named in the proxy
statement as a nominee and to serving as a director if elected);
(b) as to any other business that the shareholder proposes to
bring before the meeting, a brief description of the business
desired to be brought before the meeting, the text of the
proposal or business (including the text of any resolutions
proposed for consideration and, in the event that such business
includes a proposal to amend the Bylaws of the Company, the
language for the proposed amendment), the reasons for conducting
such business at the meeting, and any material interest in such
business of such shareholder and the beneficial owner, if any, on
whose behalf the proposal is made; and (c) as to the shareholder
giving the notice and the beneficial owner, if any, on whose
behalf the nomination or proposal is made, (i) the name and
address of such shareholder, as they appear on the Company's
books, and of such beneficial owner, (ii) the class and number of
shares of capital stock of the Company that are owned
beneficially and of record by such shareholder and such
beneficial owner, (iii) a representation that the shareholder is
a holder of record of stock of the Company entitled to vote at
such meeting and intends to appear in person or by proxy at the
meeting to propose such business or nomination, and (iv) a
representation whether the shareholder or the beneficial owner,
if any, intends or is part of a group that intends (a) to deliver
a proxy statement and/or form of proxy to holders of at least the
percentage of the Company's outstanding capital stock required to
approve or adopt the proposal or elect the nominee and/or (b)
otherwise to solicit proxies from shareholders in support of such
proposal or nomination. The Company may require any proposed
nominee to furnish such other information as it may reasonably
require to determine the eligibility of such proposed nominee to
serve as a director of the Company.
(b) Special Meetings of Shareholders. Only such business shall be
conducted at a special meeting of shareholders as shall have been
brought before the meeting pursuant to the Company's notice of
meeting.
-3-
<PAGE>
(c) General. (1) Only such persons who are nominated in accordance
with the procedures set forth in this Section 2.05 shall be
eligible to be elected at an annual or special meeting of
shareholders of the Company to serve as directors and only such
business shall be conducted at a meeting of shareholders as shall
have been brought before the meeting in accordance with the
procedures set forth in this Section 2.05. Except as otherwise
provided by law, the Chairman of the meeting shall have the power
and duty (a) to determine whether a nomination or any business
proposed to be brought before the meeting was made or proposed,
as the case may be, in accordance with the procedures set forth
in this Section 2.05 (including whether the shareholder or
beneficial owner, if any, on whose behalf the nomination or
proposal is made solicited (or is part of a group that solicited)
or did not so solicit, as the case may be, proxies in support of
such shareholder's nominee or proposal in compliance with such
shareholder's representation as required by clause (a)(2)(c)(iv)
of this Section 2.05) and (b) if any proposed nomination or
business was not made or proposed in compliance with this Section
2.05, to declare that such nomination shall be disregarded or
that such proposed business shall not be transacted.
(2) For purposes of this Section 2.05, "public announcement"
shall mean disclosure in a press release reported by the Dow
Jones News Service, Associated Press or comparable national news
service or in a document publicly filed by the Company with the
Securities and Exchange Commission pursuant to Section 13, 14 or
15(d) of the Exchange Act.
(3) Notwithstanding the foregoing provisions of this Section
2.05, a shareholder shall also comply with all applicable
requirements of the Exchange Act and the rules and regulations
thereunder with respect to the matters set forth in this Section
2.05. Nothing in this Section 2.05 shall be deemed to affect any
rights (a) of shareholders to request inclusion of proposals in
the Company's proxy statement pursuant to Rule 14a-8 of the
Exchange Act or (b) of the holders of any series of Preferred
Stock to elect directors pursuant to any applicable provisions of
the Articles.
2.06. RIGHT TO ATTEND. Except only to the extent of persons designated by
the Board of Directors or the Chairman of the meeting to assist in the conduct
of the meeting (as referred to in Sections 2.08 and 2.09 below) and except as
otherwise permitted by the Board or such Chairman, the persons entitled to
attend any meeting of shareholders may be confined to (i) shareholders entitled
to vote thereat and other shareholders entitled to notice of the meeting and
(ii) the persons upon whom proxies valid for purposes of the meeting have been
conferred or their duly appointed substitutes (if the related proxies confer a
power of substitution); provided, however, that the Board of Directors or the
Chairman of the meeting may establish rules limiting the number of persons
referred to in clause (ii) as being entitled to attend on behalf of any
shareholder so as to preclude such an excessively large representation of such
shareholder at the meeting as, in the judgment of the Board or such Chairman,
would be unfair to other shareholders represented at the meeting or be unduly
disruptive of the orderly conduct of
-4-
<PAGE>
business at such meeting (whether such representation would result from
fragmentation of the aggregate number of shares held by such shareholder for the
purpose of conferring proxies, from the naming of an excessively large proxy
delegation by such shareholder or from employment of any other device). A person
otherwise entitled to attend any such meeting will cease to be so entitled if,
in the judgment of the Chairman of the meeting, such person engages thereat in
disorderly conduct impeding the proper conduct of the meeting in the interests
of all shareholders as a group.
2.07. QUORUM. Except as otherwise provided by law, the Articles or these
Bylaws, at each meeting of shareholders the presence in person or by proxy of
the holders of a majority in voting power of the outstanding shares of stock
entitled to vote at the meeting shall be necessary and sufficient to constitute
a quorum.
2.08. ELECTION INSPECTORS. The Board of Directors, in advance of any
shareholders meeting may appoint an election inspector or inspectors to act at
such meeting (and any adjournment thereof). If an election inspector or
inspectors are not so appointed, the Chairman of the meeting may or, upon the
request of any person entitled to vote at the meeting will, make such
appointment. If any person appointed as an inspector fails to appear or to act,
a substitute may be appointed by the Chairman of the meeting. If appointed, the
election inspector or inspectors (acting through a majority of them if there be
more than one) will determine the number of shares outstanding, the
authenticity, validity and effect of proxies, the credentials of persons
purporting to be shareholders or persons named or referred to in proxies, and
the number of shares represented at the meeting in person and by proxy; they
will receive and count votes, ballots and consents and announce the results
thereof; they will hear and determine all challenges and questions pertaining to
proxies and voting; and, in general, they will perform such acts as may be
proper to conduct elections and voting with complete fairness to all
shareholders. No such election inspector need be a shareholder of the Company.
2.09. ORGANIZATION AND CONDUCT OF MEETINGS. Each shareholders meeting will
be called to order and thereafter chaired by the Chairman of the Board if there
then is one; or, if not, or if the Chairman of the Board is absent or so
requests, then by the President; or if both the Chairman of the Board and the
President are unavailable, then by such other officer of the Company or such
shareholder as may be appointed by the Board of Directors. The Secretary (or in
his or her absence an Assistant Secretary) of the Company will act as secretary
of each shareholders meeting; if neither the Secretary nor an Assistant
Secretary is in attendance, the Chairman of the meeting may appoint any person
(whether a shareholder or not) to act as secretary thereat. After calling a
meeting to order, the Chairman thereof may require the registration of all
shareholders intending to vote in person, and the filing of all proxies, with
the election inspector or inspectors, if one or more have been appointed (or, if
not, with the secretary of the meeting). After the announced time for such
filing of proxies has ended, no further proxies or changes, substitutions or
revocations of proxies will be accepted. If directors are to be elected, a
tabulation of the proxies so filed will, if any person entitled to vote in such
election so requests, be announced at the meeting (or adjournment thereof) prior
to the closing of the election polls.
Absent a showing of bad faith on his or her part, the Chairman of a meeting
will, among other things, have absolute authority to determine the order of
business to be conducted at such
-5-
<PAGE>
meeting and to establish rules for, and appoint personnel to assist in,
preserving the orderly conduct of the business of the meeting (including any
informal, or question and answer, portions thereof). Rules, regulations or
procedures regarding the conduct of the business of a meeting, whether adopted
by the Board of Directors or prescribed by the Chairman of the meeting, may
include, without limitation, the following: (i) the establishment of an agenda
or order of business for the meeting; (ii) rules and procedures for maintaining
order at the meeting and the safety of those present; (iii) limitations on
attendance at or participation in the meeting to shareholders of record of the
Company, their duly authorized and constituted proxies (subject to Section 2.06)
or such other persons as the Chairman of the meeting shall determine; (iv)
restrictions on entry to the meeting after the time fixed for the commencement
thereof; and (v) limitations on the time allotted to questions or comments by
participants. Unless and to the extent determined by the Board of Directors or
the Chairman of the meeting, meetings of shareholders shall not be required to
be held in accordance with the rules of parliamentary procedure. Any
informational or other informal session of shareholders conducted under the
auspices of the Company after the conclusion of or otherwise in conjunction with
any formal business meeting of the shareholders will be chaired by the same
person who chairs the formal meeting, and the foregoing authority on his or her
part will extend to the conduct of such informal session.
2.10. VOTING. The number of shares voted on any matter submitted to the
shareholders which is required to constitute their action thereon or approval
thereof will be determined in accordance with applicable law, the Articles, and
these Bylaws, if applicable. No ballot or change of vote will be accepted after
the polls have been declared closed following the ending of the announced time
for voting.
2.11. SHAREHOLDER APPROVAL OR RATIFICATION. The Board of Directors may
submit any contract or act for approval or ratification at any duly constituted
meeting of the shareholders, the notice of which either includes mention of the
proposed submittal or is waived as provided in Section 2.03 above. Except as
otherwise required by law (e.g., Arizona Revised Statutes Section 10-863), if
any contract or act so submitted is approved or ratified by a majority of the
votes cast thereon at such meeting, the same will be valid and as binding upon
the Company and all of its shareholders as it would be if approved and ratified
by each and every shareholder of the Company.
2.12. CONTROL SHARE ACT. The provisions of Section 10-2721 through and
including Section 10-2727 of the Arizona Revised Statutes shall not apply to the
Company.
2.13. ADJOURNMENTS. Any meeting of shareholders, annual or special, may
adjourn from time to time to reconvene at the same or some other place, and
notice need not be given of any such adjourned meeting if the time and place
thereof are announced at the meeting at which the adjournment is taken. At the
adjourned meeting the Company may transact any business that might have been
transacted at the original meeting. If the adjournment is for more than one
hundred and twenty days, or if after the adjournment a new record date is fixed
for the adjourned meeting, notice of the adjourned meeting shall be given to
each shareholder of record entitled to vote at the meeting.
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III. BOARD OF DIRECTORS
3.01. MEMBERSHIP. The Board of Directors of the corporation shall consist
of not less then nine (9) nor more than twenty-one (21) shareholders of the
Company or of any parent corporation thereof (except that it shall not be a
requirement that any member of the initial Board of Directors be a shareholder
of the Company or of any parent corporation thereof), and shall be divided into
three classes in the manner provided in the Articles (Art. Fifth). The Board
will have the exclusive power to increase or decrease its size within such
limits. Any vacancy occurring in the Board, whether by reason of death,
resignation, disqualification or otherwise, may be filled by the directors as
contemplated by law and as provided in the Articles (Art. Fifth). Any such
increase in the size of the Board, and the filling of any vacancy created
thereby, will require action by a majority of the whole membership of the Board
as comprised immediately before such increase.
3.02. QUALIFICATIONS. In order to qualify as a director, a person must be
the owner of one or more shares of the capital stock of the Company or of any
parent corporation thereof at the time of assuming office (except as may
otherwise be provided in these Bylaws or in the Articles) and for so long
thereafter as such person remains in office. A person will cease to qualify as a
director if he or she (i) is in good faith determined by a majority of the other
directors then in office to be physically or mentally incapable of competent
performance as a director for a period, starting with inception of the
incapacity, that has extended or is likely to extend for more than six months or
(ii) has failed to attend six successive regular meetings of the Board (as
determined in accordance with Section 3.03 below) unless and to the extent such
failure is waived by a majority of the other directors then in office; however,
disqualification pursuant to clause (i) or (ii) of this sentence will not
preclude the subsequent election or appointment of such person as a director by
the shareholders or the Board if a majority of the directors in office
immediately prior to the submission of such person for election or appointment
shall determine that his or her prior incapacity or principal reason for prior
non-attendance no longer exists. A person will not qualify for election or
appointment as a director, whether initially or on re-election and whether by
the shareholders at their annual meeting or by the Board of Directors as
contemplated in Section 3.01 above, if such person's 70th birthday occurs on or
has occurred before the date of such election, appointment or re-election. A
person who has been a full-time employee of the Company within twelve months
prior to the date of any election will not qualify for election as a director on
that date unless he or she then remains a full-time employee of the Company or
unless the Board of Directors specifically authorizes the election of such
person (but it is not intended that any such authorization will extend a
person's service on the Board beyond the age limitation set out in the preceding
sentence). A person who has qualified by age or employment status for his or her
most recent election as a director may serve throughout the term for which such
person was elected, notwithstanding the occurrence of his or her 70th birthday
or cessation of full-time employment by the Company between the date of such
election and the end of such term, subject, however, to his or her otherwise
remaining qualified for such office.
3.03. REGULAR MEETINGS. A regular annual meeting of the directors is to be
held as soon as practicable after the adjournment of each annual shareholders
meeting either at the place of the shareholders meeting or at such other place
as the directors elected at the shareholders meeting may have been informed of
at or before the time of their election. Regular meetings,
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other than the annual ones, may be held at such intervals at such places and at
such times as the Board of Directors may provide.
3.04. SPECIAL MEETINGS. Special meetings of the Board of Directors may be
held whenever and wherever called for by the Chairman of the Board, the
President or the number of directors which would be required to constitute a
quorum.
3.05. NOTICE. No notice need be given of regular meetings of the Board of
Directors. Notice of the time and place (but not necessarily the purpose or all
of the purposes) of any special meeting will be given to each director in person
or by telephone, or via mail, telegram, facsimile, or other electronic
transmission addressed in the manner appearing on the Company's records. Notice
to any director of any such special meeting will be deemed given sufficiently in
advance when (i) if given by mail, the same is deposited in the United States
mail at least four days before the meeting date, with postage thereon prepaid,
(ii) if given by telegram, the same is delivered to the telegraph office for
fast transmittal at least 48 hours prior to the convening of the meeting, (iii)
if given by facsimile or other electronic transmission, the same is received by
the director or an adult member of his or her office staff or household, at
least 24 hours prior to the convening of the meeting, or (iv) if personally
delivered or given by telephone, the same is handed, or the substance thereof is
communicated over the telephone to the director or to an adult member of his or
her office staff or household, at least 24 hours prior to the convening of the
meeting. Any such notice may be waived as provided by law. No call or notice of
a meeting of directors will be necessary if each of them waives the same in
writing or by attendance. Any meeting, once properly called and noticed (or as
to which call and notice have been waived as aforesaid) and at which a quorum is
formed, may be adjourned to another time and place by a majority of those in
attendance.
3.06. QUORUM; VOTING. A quorum for the transaction of business at any
meeting or adjourned meeting of the directors will consist of a majority of
those then in office. Any matter submitted to a meeting of the directors will be
resolved by a majority of the votes cast thereon, except as otherwise required
by these Bylaws (ss.ss. 3.01 and 3.02 above and ss. 3.07 below), by law or by
any applicable Article. However, in case of an equality of votes, the Chairman
of the meeting will have a second or deciding vote. Where action by a majority
of the whole membership is required, such requirement will be deemed to relate
to a majority of the directors in office at the time the action is taken. In
computing any such majority, whether for purposes of determining the presence of
a quorum or the adequacy of the vote on any proposed action, any unfilled
vacancies at the time existing in the membership of the Board will be excluded
from the computation.
3.07. EXECUTIVE COMMITTEE. The Board of Directors may, by resolution
adopted by a majority of the whole Board, name three or more of its members as
an Executive Committee. Such Executive Committee will have and may exercise the
powers of the Board of Directors in the management of the business and affairs
of the Company while the Board is not in session, except only as precluded by
law or where action other than by a majority of the votes cast is required by
these Bylaws, or the law (all as referred to in Section 3.06 above), and subject
to such limitations as may be included in any applicable resolution passed by a
majority of the whole membership of the Board. A majority of those named to the
Executive Committee will constitute a quorum.
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3.08. OTHER COMMITTEES. The Board of Directors may designate one or more
additional committees, each committee to consist of one or more of the directors
of the Company. The Board of Directors may designate one or more directors as
alternate members of any committee, who may replace any absent or disqualified
member at any meeting of the committee. Any such committee, to the extent
permitted by law and to the extent provided in the resolution of the Board of
Directors, shall have and may exercise all the powers and authority of the Board
of Directors in the management of the business and affairs of the Company, and
may authorize the seal of the Company to be affixed to all papers that may
require it.
3.09. COMMITTEE FUNCTIONING. Notice requirements and related waiver
provisions for meetings of the Executive Committee and other committees of the
Board will be the same as those set forth in Section 3.05 above for meetings of
the Board of Directors. Except as provided in the next two succeeding sentences,
a majority of those named to the Executive Committee or any other committee of
the Board will constitute a quorum at any meeting thereof (with the effect of
departure of committee members from a meeting and the computation of a majority
of committee members to be in accordance with the applicable policies of Section
3.06 above), and any matter submitted to a meeting of any such committee will be
resolved by a majority of the votes cast thereon. No distinction will be made
among ex-officio or other members of any such committee for quorum, voting or
other purposes, except that the membership of any committee (including the
Executive Committee), in performing any function vested in it as herein
contemplated, may be deemed to exclude any officer or employee of the Company,
in either case, or other person having a direct or indirect personal interest in
any proposed exercise of such function, whose exclusion for that purpose is
deemed appropriate by a majority of the other members of such committee
proposing to perform such function. All committees are to keep regular minutes
of the transactions of their meetings.
3.10. ACTION BY TELEPHONE OR CONSENT. Any meeting of the Board or any
committee thereof may be held by conference telephone or similar communications
equipment as permitted by law, in which case any required notice of such meeting
may generally describe the arrangements (rather than the place) for the holding
thereof, and all other provisions herein contained or referred to will apply to
such meeting as though it were physically held at a single place. Action may
also be taken by the Board or any committee thereof without a meeting if the
members thereof consent in writing thereto as contemplated by law.
3.11. PRESUMPTION OF ASSENT. A director of the Company who is present at a
meeting of the Board of Directors, or of any committee when corporate action is
taken is deemed to have assented to the action taken unless either (i) the
director objects at the beginning of the meeting or promptly on the director's
arrival to holding it or transacting business at the meeting; (ii) the
director's dissent or abstention from the action taken is entered in the minutes
of the meeting; or (iii) the director delivers written notice of the director's
dissent or abstention to the presiding officer of the meeting before its
adjournment or to the Company before 5:00 P.M. on the next business day after
the meeting. The right of dissent or abstention is not available to a director
who votes in favor of the action taken.
3.12. COMPENSATION. By resolution of the Board, the directors may be paid
their expenses, if any, of attendance at each meeting of the Board of Directors,
or of any committee, and may be paid a fixed sum for attendance at each such
meeting and/or a stated salary as a
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director or committee member. No such payment will preclude any director from
serving the Company in any other capacity and receiving compensation therefor.
3.13. REMOVAL. Any director or the entire Board of Directors may be removed
with or without cause, only at a special meeting of shareholders called for that
purpose, by the affirmative vote of sixty-six and two-thirds percent (66 2/3%)
of the issued and outstanding shares of stock then entitled to vote on the
election of directors, except that if less than the entire Board of Directors is
to be removed, no one of the directors may be removed if the votes cast against
the director's removal would be sufficient to elect the director if then
cumulatively voted at an election for the class of directors of which the
director is a part.
IV. OFFICERS - GENERAL
4.01. ELECTIONS AND APPOINTMENTS. The directors may elect or appoint one or
more of the officers of the Company contemplated in Part V below. Any such
election or appointment will regularly take place at the annual meeting of the
directors, but elections of officers may be held at any other meeting of the
Board. A person elected or appointed to any office will continue to hold that
office until the election or appointment of his or her successor, subject to
action earlier taken pursuant to Section 4.04 or 6.01 below. Any person may hold
more than one office.
4.02. ADDITIONAL APPOINTMENTS. In addition to the officers contemplated in
Part V below, the Board of Directors may create other corporate positions, and
appoint persons thereto, with such authority to perform such duties as may be
prescribed from time to time by the Board of Directors, by the President or by
the superior officer of any person so appointed. Notwithstanding such additional
appointments, only those persons whose offices are described in Part V are to be
considered an officer of the Company unless the resolution or other Board action
appointing such person expressly states that such person is to be considered an
officer of the Company. Each of such persons (in the order designated by the
Board or the superior officer of such person) will be vested with all of the
powers and charged with all of the duties of his or her superior officer in the
event of such superior officer's absence or disability.
4.03. BONDS AND OTHER REQUIREMENTS. The Board of Directors may require any
officer or other appointee to give bond to the Company (with sufficient surety,
and conditioned upon the faithful performance of the duties of his or her office
or position) and to comply with such other conditions as may from time to time
be required of him or her by the Board.
4.04. REMOVAL OR DELEGATION. Provided that a majority of the whole
membership thereof concurs therein, the Board of Directors may remove any
officer of the Company as provided by law and declare his or her office or
offices vacant or abolished or, in the case of the absence or disability of any
officer or for any other reason considered sufficient, may temporarily delegate
his or her powers and duties to any other officer or to any director. Similar
action may be taken by the Board of Directors in regard to appointees designated
pursuant to Section 4.02 above.
4.05. SALARIES. Officer salaries may from time to time be fixed by the
Board of Directors or (except as to his or her own) be left to the discretion of
the Chief Executive Officer
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or the President. No officer will be prevented from receiving a salary by reason
of the fact that he or she is also a director of the Company.
V. SPECIFIC OFFICERS, FUNCTIONS AND POWERS
5.01. CHAIRMAN OF THE BOARD. The Board of Directors may elect a Chairman to
serve as a general executive officer of the Company and, if specifically
designated as such by the Board, as the Chief Executive Officer of the Company.
If elected, the Chairman will preside at all meetings of the directors and be
vested with such other powers and duties as the Board may from time to time
delegate to him or her.
5.02. CHIEF EXECUTIVE OFFICER. Subject to the control of the Board of
Directors exercised as hereinafter provided, the Chief Executive Officer of the
Company will supervise its business and affairs and the performance of their
respective duties by all other officers, by appointees designated pursuant to
Section 4.02 above, and by such additional appointees to such additional
positions (corporate, divisional or otherwise) as the Chief Executive Officer
may designate, with authority on his or her part to delegate the foregoing duty
of supervision to such extent and to such person or persons as may be determined
by the Chief Executive Officer. Except as otherwise indicated from time to time
by resolution of the Board of Directors, its management of the business and
affairs of the Company will be implemented through the office of the Chief
Executive Officer.
5.03. PRESIDENT AND VICE PRESIDENTS. Unless specified to the contrary by
resolution of the Board of Directors, the President will be the Chief Executive
Officer of the Company. In addition to the supervisory functions above set forth
on the part of the Chief Executive Officer or in lieu thereof if a contrary
specification is made by the Board relative to the Chief Executive Officer, the
President will be vested with such powers and duties as the Board may from time
to time designate. Vice Presidents may be elected by the Board of Directors to
perform such duties as may be designated by the Board or be assigned or
delegated to them by their respective superior officers. The Board may identify
(i) one or more Vice Presidents as "Executive" or "Senior" Vice Presidents and
(ii) the President or any Vice President as "General Manager" of the Company and
the title of any Vice President may include words indicative of his or her
particular area of responsibility and authority. Vice Presidents will succeed to
the responsibilities and authority of the President, in the event of his or her
absence or disability, in the order consistent with their respective titles or
regular duties or as specifically designated by the Board of Directors.
5.04. TREASURER AND SECRETARY. The Treasurer and Secretary each will
perform all such duties normally associated with his or her office (including,
in the case of the Secretary, the giving of notice and the preparation and
retention of minutes of corporate proceedings and the custody of corporate
records and the seal of the Company) as are not assigned to a Vice President of
the Company, along with such other duties as may be designated by the Board or
be assigned or delegated to them by their respective superior officers. The
Board may appoint one or more Assistant Treasurers or Assistant Secretaries,
each of whom (in the order designated by the Board or their respective superior
officers) will be vested with all of the powers and charged with all of the
duties of the Treasurer or the Secretary (as the case may be) in the event of
his or her absence or disability.
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5.05. SPECIFIC POWERS. Except as may otherwise be specifically provided in
a resolution of the Board of Directors, any of the officers referred to in this
Part V will be a proper officer to authenticate records of the Company and to
sign on behalf of the Company any deed, bill of sale, assignment, option,
mortgage, pledge, note, bond, debenture, evidence of indebtedness, application,
consent (to service of process or otherwise), agreement, indenture or other
instrument of importance to the Company. Any such officer may represent the
Company at any meeting of the shareholders or members of any corporation,
association, partnership, joint venture or other entity in which this Company
then has an interest, and may vote such interest in person or by proxy appointed
by him or her, provided that the Board of Directors may from time to time confer
the foregoing authority upon any other person or persons.
VI. RESIGNATIONS AND VACANCIES
6.01. RESIGNATIONS. Any director, committee member or officer may resign
from his or her office at any time by written notice as specified in accordance
with Arizona Revised Statutes Sections 10-807 and 10-843. The acceptance of a
resignation will not be required to make it effective.
6.02. VACANCIES. If the office of any director, committee member or officer
becomes vacant by reason of his or her death, resignation, disqualification,
removal or otherwise, the Board of Directors may choose a successor to hold
office for the unexpired term.
VII. INDEMNIFICATION AND RATIFICATION
7.01. INDEMNIFICATION. In order to induce qualified persons to serve the
Company (and any other corporation, joint venture, partnership, trust or other
enterprise at the request of the Company) as directors and officers, the Company
may indemnify any and all of its directors and officers, or former directors and
officers to the fullest extent permitted by applicable law as it presently
exists or may hereafter be amended.
7.02. RATIFICATION; SPECIAL COMMITTEE. Any transaction involving the
Company, any of its subsidiary corporations or any of its directors, officers,
employees or agents which at any time is questioned in any manner or context
(including a shareholders derivative suit), on the ground of lack of authority,
conflict of interest, misleading or omitted statement of fact or law,
nondisclosure, miscomputation, improper principles or practices of accounting,
inadequate records, defective or irregular execution or any similar ground, may
be investigated and/or ratified (before or after judgment), or an election may
be made not to institute or pursue a claim or legal proceedings on account
thereof or to accept or approve a negotiated settlement with respect thereto
(before or after the institution of legal proceedings), by the Board of
Directors or by a special committee thereof comprised of one or more
disinterested directors (that is, a director or directors who did not
participate in the questioned transaction with actual knowledge of the
questioned aspect or aspects thereof). Such a special committee may be validly
formed and fully empowered to act, in accordance with the purposes and duties
assigned thereto, by resolution or resolutions of the Board of Directors,
notwithstanding (i) the inclusion of Board members who are not disinterested as
aforesaid among those who form a quorum at the meeting or meetings at which one
or more members of such special committee are elected or appointed to the Board
or to such special committee or at which such committee is formed or empowered,
or
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their inclusion among the directors who vote upon or otherwise participate in
taking any of the foregoing actions, or (ii) the taking of any of such actions
by the disinterested members of the Board (or a majority of such members) whose
number is not sufficient to constitute a quorum or a majority of the membership
of the full Board. Any such special committee so comprised will, to the full
extent consistent with its purposes and duties as expressed in such resolution
or resolutions, have all of the authority and powers of the full Board and its
Executive Committee (the same as though it were the full Board and/or its
Executive Committee in carrying out such purposes and duties) and will function
in accordance with Section 3.09 above. No other provisions of these Bylaws which
may at any time appear to conflict with any provisions of this Section 7.02, and
no defect or irregularity in the formation, empowering or functioning of any
such special committee, will serve to impede, impair or bring into question any
action taken or purported to be taken by such committee or the validity of any
such action. Any ratification of a transaction pursuant to this Section 7.02
will have the same force and effect as if the transaction has been duly
authorized originally. Any such ratification, and any election made pursuant to
this Section 7.02 with respect to claims, legal proceedings or settlements, will
be binding upon the Company and its shareholders and will constitute a bar to
any claim or the execution of any judgment in respect of the transaction
involved in such ratification or election.
VIII. SEAL
8.01. FORM THEREOF. The seal of the Company will have inscribed thereon the
name of the Company, the state and year of its incorporation and the words
"SEAL".
IX. STOCK CERTIFICATES
9.01. FORM THEREOF. Each certificate representing stock of the Company will
be in such form conforming to law as may from time to time be approved by the
Board of Directors, and will bear the manual facsimile signatures and seal of
the Company as required or permitted by law.
9.02. OWNERSHIP. The Company will be entitled to treat the registered owner
of any share as the absolute owner thereof and accordingly, will not be bound to
recognize any beneficial, equitable or other claim to, or interest in, such
share on the part of any other person, whether or not it has notice thereof,
except as may expressly be provided by Chapter 8 of Title 47, Arizona Revised
Statutes (or its successor), as at the time in effect, or other applicable law.
9.03. TRANSFERS. Transfer of stock will be made on the books of the Company
only upon surrender of the certificate therefor, duly endorsed by an appropriate
person, with such assurance of the genuineness and effectiveness of the
endorsement as the Company may require, all as contemplated by Chapter 8 of
Title 47, Arizona Revised Statutes (or its successor), as at the time in effect,
and/or upon submission of any affidavit, other document or notice which the
Company considers necessary.
9.04. LOST CERTIFICATES. In the event of the loss, theft or destruction of
any certificate representing capital stock of this Company, the Company may
issue (or, in the case of any such stock as to which a transfer agent and/or
registrar have been appointed, may direct such transfer agent and/or registrar
to countersign, register and issue) a replacement certificate in lieu of that
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alleged to be lost, stolen or destroyed, and cause the same to be delivered to
the owner of the stock represented thereby, provided that the owner shall have
submitted such evidence showing the circumstances of the alleged loss, theft or
destruction, and his or her ownership of the certificate as the Company
considers satisfactory, together with any other factors which the Company
considers pertinent, and further provided that an indemnity agreement and/or
indemnity bond shall have been provided in form and amount satisfactory to the
Company and to its transfer agent and/or registrar, if applicable.
X. EMERGENCY BYLAWS
10.01. EMERGENCY CONDITIONS. The emergency Bylaws provided in this Part X
will be as effective in the event of an emergency as prescribed in Arizona
Revised Statutes Section 10-207.D. To the extent not inconsistent with the
provisions of this Part X, these Bylaws will remain in effect during such
emergency and upon its termination these emergency Bylaws will cease to be
operative.
10.02. BOARD MEETINGS. During any such emergency, a meeting of the Board of
Directors or any of its committees may be called by any officer or director of
the Company. Notice of the time and place of the meeting will be given by the
person calling the same to those of the directors whom it may be feasible to
reach by any available means of communication. Such notice will be given so much
in advance of the meeting as circumstances permit in the judgment of the person
calling the same. At any Board or committee meeting held during any such
emergency, a quorum will consist of a majority of those who could reasonably be
expected to attend the meeting if they were willing to do so, but in no event
more than a majority of those to whom notice of such meeting is required to have
been given as above provided.
10.03. CERTAIN ACTIONS. The Board of Directors, either before or during any
such emergency, may provide and from time to time modify lines of succession in
the event that during such an emergency any or all officers, appointees,
employees or agents of the Company are for any reason rendered incapable of
discharging their duties. The Board, either before or during any such emergency,
may, effective in the emergency, change the head office or designate several
alternative head offices of the Company, or authorize the officers to do so.
10.04. LIABILITY. No director, officer, appointee, employee or agent acting
in accordance with these emergency Bylaws will be liable except for willful
misconduct.
10.05. MODIFICATIONS. These emergency Bylaws will be subject to repeal or
change by further action of the Board of Directors, but no such repeal or change
will modify the provisions of Section 10.04 with respect to action taken prior
to the time of such repeal or change. Any amendment of these emergency Bylaws
may make any further or different provisions that may be practical and necessary
for the circumstances of the emergency.
XI. DIVIDENDS
11.01. DECLARATION. Subject to such restrictions or requirements as may be
imposed by law or the Company's Articles or as may otherwise be binding upon the
Company, the Board of Directors may from time to time declare dividends on stock
of the Company outstanding on the
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dates of record fixed by the Board, to be paid in cash, in property or in shares
of the Company's stock on or as of such payment or distribution dates as the
Board may prescribe.
XII. BUSINESS COMBINATIONS
12.01. DEFINITIONS. In these Bylaws, the following definitions shall apply:
1. "Affiliate" means a person that directly or indirectly controls,
is controlled by, or is under common control with a specified
person.
2. "Announcement date," when used in reference to any business
combination, means the date of the first public announcement of
the final, definitive proposal for the business combination.
3. "Associate," when used to indicate a relationship with any
person, means any of the following:
(a) Any corporation or organization of which the person is an
officer, director, or partnership or is, directly or
indirectly, the beneficial owner of ten percent (10%) or
more of any class or series of shares entitled to vote or
other equity interest;
(b) Any trust or estate in which the person has a substantial
beneficial interest or as to which the person serves as
trustee or personal representative or in a similar fiduciary
capacity; or
(c) Any relative or spouse of the person, or any relative of the
spouse, residing in the home of the person.
4. "Beneficial owner," when used with respect to shares or other
securities, includes any person who, directly or indirectly
through any agreement, arrangement, relationship, understanding,
or otherwise, whether or not in writing, has or shares the power
to vote, or direct the voting of the shares or securities or has
or shares the power to dispose of or direct the disposition of
the shares or securities, except that:
(a) A person is not deemed the beneficial owner of shares or
securities tendered pursuant to a tender or exchange offer
made by the person or any of the person's affiliates or
associates until the tendered shares or securities are
accepted for purchase or exchange; and
(b) A person is not deemed the beneficial owner of shares or
securities with respect to which the person has the power to
vote or direct the voting arising solely from a revocable
proxy given in response to a proxy solicitation required to
be made and made in accordance with the applicable rules and
regulations under the Securities Exchange Act of 1934, as
amended, and is not then reportable under that act on a
Schedule 13D or comparable report.
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5. "Beneficial ownership" includes the right to acquire shares or
securities through the exercise of options, warrants, or rights,
the conversion of convertible securities, or otherwise. The
shares or securities subject to the options, warrants, rights, or
conversion privileges held by a person are deemed to be
outstanding for the purpose of computing the percentage of
outstanding shares or securities of the class or series owned by
the person but are not deemed to be outstanding for the purpose
of computing the percentage of the class or series owned by any
other person. A person is deemed the beneficial owner of shares
and securities beneficially owned by the spouse of the person or
any relative of the spouse residing in the home of the person,
any trust or estate in which the person owns ten percent (10%) or
more of the total beneficial interest or serves as trustee or
personal representative, any corporation or entity in which the
person owns ten percent (10%) or more of the equity and any
affiliate of the person.
6. "Business combination," when used in reference to the Company and
any interested shareholder of the Company, means any of the
following:
(a) Any merger or consolidation of the Company or any subsidiary
of the Company with either:
(i) The interested shareholder; or
(ii) Any other domestic or foreign corporation, whether or
not itself an interested shareholder of the Company,
that is, or after the merger would be, an affiliate or
associate of the interested shareholder, except that
the foregoing does not include the merger of a
wholly-owned subsidiary of the Company into the
Company or the merger of two or more wholly-owned
subsidiaries of the Company.
(b) Any exchange, pursuant to a plan of exchange under the laws
of the State of Arizona or a comparable statute of any other
state or jurisdiction, of shares of the Company or any
subsidiary of the Company for shares of either:
(i) The interested shareholder; or
(ii) Any other domestic or foreign corporation, whether or
not itself an interested shareholder of the Company,
that is, or after the exchange would be, an affiliate
or associate of the interested shareholder.
(c) Any sale, lease, exchange, mortgage, pledge, transfer, or
other disposition, in a single transaction or a series of
transactions, to or with the interested shareholder or any
affiliate or associate of the
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interested shareholder, of assets of the Company or any
subsidiary of the Company to which any of the following
applies:
(i) Has an aggregate market value equal to ten percent
(10%) or more of the aggregate market value of all the
assets, determined on a consolidated basis, of the
Company.
(ii) Has an aggregate market value equal to ten percent
(10%) or more of the aggregate market value of all the
outstanding shares of the Company.
(iii) Represents ten percent (10%) or more of the earning
power or net income, determined on a consolidated
basis, of the Company.
(d) The issuance or transfer by the Company or any subsidiary of
the Company, in a single transaction or a series of
transactions, of any shares of the Company or any subsidiary
of the Company that have an aggregate market value equal to
five percent (5%) or more of the aggregate market value of
all the outstanding shares of the Company to the interested
shareholder or any affiliate or associate of the interested
shareholder, except pursuant to the exercise of warrants or
rights to purchase shares offered or a dividend or
distribution paid or made pro rata to all shareholders of
the Company.
(e) The adoption of any plan or proposal for the liquidation or
dissolution of the Company, or any reincorporation of the
Company in another state or jurisdiction, proposed by, on
behalf of, or pursuant to any agreement, arrangement, or
understanding, whether or not in writing, with the
interested shareholder or any affiliate or associate of the
interested shareholder.
(f) Any reclassification of securities, including any share
dividend or split, reverse share split, or other
distribution of shares in respect of shares,
recapitalization of the Company, merger or consolidation of
the Company with any subsidiary of the Company exchange of
shares of the Company with any subsidiary of the Company or
other transaction, whether or not with or into or otherwise
involving the interested shareholder, proposed by, on behalf
of, or pursuant to any agreement, arrangement, or
understanding, whether or not in writing, with the
interested shareholder or any affiliate or associate of the
interested shareholder that has the effect, directly or
indirectly, of increasing the proportionate share of the
outstanding shares of any class or series of shares entitled
to vote, or securities that are exchangeable for or
convertible into or that carry a right to acquire shares
entitled to vote, of the Company
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or any subsidiary of the Company that is, directly or
indirectly, owned by the interested shareholder or any
affiliate or associate of the interested shareholder, except
as a result of immaterial changes due to fractional share
adjustments.
(g) Any receipt by the interested shareholder or any affiliate
or associate of the interested shareholder of the benefit,
directly or indirectly, except proportionately as a
shareholder of the Company, of any loans, advances,
guarantees, pledges, or other financial assistance or any
tax credits or other tax advantages provided by or through
the Company or any subsidiary of the Company (other than
expense account advances made in the ordinary course of
business).
7. "Consummation date," with respect to any business combination,
means the date of consummation of the business combination or, in
the case of a business combination as to which a shareholder vote
is taken, the later of:
(i) The business day before the vote; or
(ii) Twenty (20) days before the date of consummation of the
business combination.
8. "Control," "controlling," "controlled by" or "under common
control with" means the possession, directly or indirectly, of
the power to direct or cause the direction of the management and
policies of a person, whether through the ownership of voting
securities, by contract, or otherwise. A person's beneficial
ownership of ten percent (10%) or more of the voting power of the
Company's outstanding shares entitled to vote in the election of
directors creates a presumption that the person has control of
the Company. A person is not considered to have control of the
Company if the person holds voting power, in good faith and not
for the purpose of avoiding any provision of law as an agent,
bank, broker, nominee, custodian, or trustee for one or more
beneficial owners who do not individually or as a group have
control of the Company.
9. "Interested shareholder," when used in reference to the Company
means any person, other than the Company or any subsidiary of the
Company, that is either:
(a) The beneficial owner, directly or indirectly, of ten percent
(10%) or more of the voting power of the outstanding shares
entitled to vote of the Company; or
(b) An affiliate or associate of the Company.
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10. "Interested shares" means the shares of the Company with respect
to which any of the following persons may exercise or direct the
exercise of voting power in the election of directors of the
Company:
(a) An interested shareholder;
(b) Any officer of the Company; or
(c) Any director of the Company.
11. "Market value," when used in reference to shares or property of
the Company, means the following:
(a) In the case of shares, the highest closing sale price during
the thirty (30) day period immediately preceding the date in
question of a share on the composite tape for New York Stock
Exchange listed shares or, if the shares are not quoted on
the composite tape or not listed on the New York Stock
Exchange, on the principal United States securities exchange
registered under the Securities Exchange Act of 1934, as
amended, on which the share are listed or, if the shares are
not listed on any such exchange, on the National Association
of Securities Dealers, Inc. Automated Quotations National
Market System or, if the shares are not quoted on the
National Association of Securities Dealers, Inc. Automated
Quotations National Market System, the highest closing bid
quotation during the thirty (30) day period preceding the
date in question of a share on the National Association of
Securities Dealers, Inc. Automated Quotations System or any
system then in use or, if no such quotation is available,
the fair market value on the date in question of a share as
determined in good faith by the Board of the Company,
subject to arbitration.
(b) In the case of property other than cash or shares, the fair
market value of the property on the date in question as
determined in good faith by the Board of the Company,
subject to arbitration.
12. "Person" means any natural person, partnership, corporation,
group, association, venture, firm, or other entity (other than
the Company, any subsidiary of the Company, or a trustee or
fiduciary holding stock for the benefit of the employees of the
Company or its subsidiaries or any one of its subsidiaries,
pursuant to one or more employee benefit plans). If two or more
persons act as a partnership, limited partnership, syndicate, or
other group pursuant to any agreement, arrangement, relationship,
understanding, or otherwise, whether or not in writing, for the
purposes of acquiring, owning, or voting shares of the Company,
all members of the partnership, syndicate, or other group shall
be deemed a person. Person does not include a licensed broker,
dealer, or underwriter that purchases
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shares of the Company solely for purposes of resale to the public
that is not acting in concert with an interested shareholder.
13. "Share acquisition date," with respect to any person and the
Company, means the date that the person first becomes an
interested shareholder of the Company.
12.02. BUSINESS COMBINATION WITH INTERESTED SHAREHOLDERS; APPROVED BY
DIRECTORS.
1. Except as set forth in these Bylaws, the Company may not engage
in any business combination or vote, consent or otherwise act to
authorize a subsidiary of the Company to engage in any business
combination with respect to, proposed by, or on behalf of, or
pursuant to any agreement, arrangement or understanding, whether
or not in writing, with any interested shareholder of the Company
or any affiliate or associate of the interested shareholder for a
period of three (3) years after the interested shareholder's
share acquisition date, unless the business combination or the
acquisition of shares made by the interested shareholder on the
interested shareholder's share acquisition date is approved by a
committee of the Board of Directors of the Company before the
interested shareholder's share acquisition date. The committee
shall be formed in accordance with subsection 4 of this Section
12.02.
2. If a good faith definitive proposal regarding a business
combination is made in writing to the Board of Directors of the
Company, a committee of the Board formed in accordance with
subsection 4 of this Section 12.02 shall consider and take action
on the proposal and respond in writing within forty-five (45)
days after receipt of the proposal by the Company, setting forth
its decision regarding the proposal.
3. If a good faith definitive proposal to acquire shares is made in
writing to the Board of Directors of the Company, a committee of
the Board of Directors formed in accordance with subsection 4 of
this Section 12.02 shall consider and take action on the
proposal. Unless the committee responds affirmatively in writing
within forty-five (45) days after receipt of the proposal by the
Company, the committee shall be considered to have disapproved
the share acquisition.
4. When a business combination or acquisition of shares is proposed
pursuant to this Section 12.02, the Board of Directors shall
promptly form a committee composed of all of the Board's
disinterested Directors. The committee shall take action on the
proposal by the affirmative vote of a simple majority of the
committee members. The committee is not subject to any direction
or control by the Board with respect to the committee's
consideration of or any action concerning a business combination
or acquisition of shares pursuant to this Section 12.02. A
committee formed pursuant to this subsection shall be composed of
one or more members.
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Only disinterested Directors may be members of a committee formed
pursuant to this subsection. However, if the Board of Directors
has no disinterested Directors, the Board shall select three or
more disinterested persons to be committee members. For purposes
of this subsection, a Director or person is disinterested if the
Director or person is not an interested shareholder or an
affiliate thereof or a present or former officer or employee of
the Company or an affiliate or associate of the Company.
12.03. Requirements after Three Years. Except for the provisions of
Sections 12.02 and 12.04, the Company may not engage at any time in any business
combination or vote, consent, or otherwise act to authorize a subsidiary of the
Company to engage in any business combination with respect to, proposed by, on
behalf of, or pursuant to any agreement, arrangement, or understanding, whether
or not in writing, with an interested shareholder of the Company or any
affiliate or associate of the interested shareholder other than a business
combination meeting all the requirements of this Article XII, the Articles, and
the requirements specified in any of the following:
1. A business combination with respect to which the consummation
date is no less than three years after the share acquisition
date, approved by the Board of Directors of the Company before
the interested shareholder's share acquisition date, or as to
which the acquisition of shares made by the interested
shareholder on the interested shareholder's acquisition date had
been approved by the Board of Directors before the interested
shareholder's share acquisition date.
2. A business combination approved by the affirmative vote of the
holders of a majority of the outstanding shares entitled to vote
not beneficially owned by the interested shareholder proposing
the business combination or any affiliate or associate of the
interested shareholder proposing the business combination at a
meeting called for that purpose no earlier than three years after
the interested shareholder's share acquisition date.
3. A business combination, with respect to which the consummation
date is no earlier than three years after the interested
shareholder's share acquisition date, that meets all of the
following conditions:
(a) The aggregate amount of the cash and the market value as of
the consummation date of consideration other than cash to be
received per share by holders of outstanding common shares
of the Company in the business combination is at least equal
to the higher of the following:
(i) The highest per share price paid by the interested
shareholder, at a time when the interested shareholder
was the beneficial owner, directly or indirectly, of
five percent (5%) or more of the outstanding shares
entitled to vote of the Company, for any common shares
of the same class or
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series acquired by it within the three (3) year period
immediately before the announcement date with respect
to the business combination or within the three (3)
year period immediately before, or in, the transaction
in which the interested shareholder became an
interested shareholder, whichever is higher, plus, in
either case, interest compounded annually from the
earliest date on which the highest per share
acquisition price was paid through the consummation
date at the rate for one year United States treasury
obligations from time to time in effect less the
aggregate amount of any cash dividends paid, and the
market value of any dividends paid other than in cash,
per common share since the earliest date, up to the
amount of the interest.
(ii) The market value per common share on the announcement
date with respect to the business combination or on
the interested shareholder's share acquisition date,
whichever is higher, plus interest compounded annually
from that date through the consummation date at the
rate for one year United States treasury obligations
from time to time in effect less the aggregate amount
of any cash dividends paid and the market value of any
dividends paid other than in cash, per common share
since that date, up to the amount of the interest.
(b) The aggregate amount of the cash and the market value
as of the consummation date of consideration other
than cash to be received per share by holders of
outstanding shares of any class or series of shares,
other than common shares, of the Company in the
business combination is at least equal to the highest
of the following, whether or not the interested
shareholder has previously acquired any shares of the
class or series:
(i) The highest per share price paid by the
interested shareholder, at a time when the
interested shareholder was the beneficial owner,
directly or indirectly, of five percent (5%) or
more of the outstanding shares entitled to vote
of the Company, for any shares of the class or
series acquired by it within the three (3) year
period immediately before the announcement date
with respect to the business combination or
within the three (3) year period immediately
before, or in, the transaction in which the
interested shareholder became an interested
shareholder, whichever is higher, plus, in
either
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case, interest compounded annually from the
earliest date on which the highest per share
acquisition price was paid through the
consummation date at the rate for one year
United States treasury obligations from time to
time in effect less the aggregate amount of any
cash dividends paid and the market value of any
dividends paid other than in cash, per share of
the class or series since such earliest date, up
to the amount of the interest.
(ii) The highest preferential amount per share to
which the holders of shares of the class or
series are entitled in the event of any
voluntary liquidation, dissolution, or winding
up of the Company, plus the aggregate amount of
any unpaid dividends declared or due as to which
the holders are entitled before payment of
dividends on some other class or series of
shares, unless the aggregate amount of the
dividends is included in the preferential
amount.
(iii) The market value per share of the class or
series on the announcement date with respect to
the business combination or on the interested
shareholder's share acquisition date, whichever
is higher, plus interest compounded annually
from that date through the consummation date at
the rate for one year United States treasury
obligations from time to time in effect less the
aggregate amount of any cash dividends paid and
the market value of any dividends paid other
than in cash, per share of the class or series
since that date, up to the amount of the
interest.
(c) The consideration to be received by holders of a
particular class or series of outstanding shares,
including common shares, of the Company in the business
combination is in cash or in the same form as the
interested shareholder has used to acquire the largest
number of shares of the class or series of shares
previously acquired by it and the consideration is
distributed promptly.
(d) The holders of all outstanding shares of the Company
not beneficially owned by the interested shareholder
immediately before the consummation date with respect
to the business combination are entitled to receive in
the
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business combination cash or other consideration for
the shares in compliance with subdivisions (a), (b) and
(c).
(e) After the interested shareholder's share acquisition
date and before the consummation date with respect to
the business combination, the interested shareholder
has not become the beneficial owner of any additional
shares entitled to vote of the Company except:
(i) As part of the transaction that resulted in the
interested shareholder becoming an interested
shareholder;
(ii) By virtue of proportionate share splits, share
dividends, or other distributions of shares in
respect of shares not constituting a business
combination;
(iii) Through a business combination meeting all of
the conditions of Section 12.02 and this
paragraph; or
(iv) Through purchase by the interested shareholder
at any price that, if the price had been paid in
an otherwise permissible business combination
the announcement date and consummation date of
which were the date of the purchase, would have
satisfied the requirements of subdivisions (a),
(b) and (c) of this Section.
12.04. APPLICATION. This Article XII does not apply to any business
combination of the Company with an interested shareholder of the Company who
became an interested shareholder inadvertently, if the interested shareholder
both:
1. As soon as practicable, divests itself of a sufficient amount of
the shares entitled to vote of the Company so that it no longer
is the beneficial owner, directly or indirectly, of ten percent
(10%) or more of the outstanding shares entitled to vote of the
Company.
2. Would not at any time within the three (3) year period preceding
the announcement date with respect to the business combination
have been an interested shareholder except for the inadvertent
acquisition.
XIII. LIMITATION ON SHARE REPURCHASES
13.01. LIMITATION ON SHARE REPURCHASES. The Company shall not, directly or
indirectly, purchase or agree to purchase any shares entitled to vote from a
person, or two or more persons who act as a partnership, limited partnership,
syndicate or other group pursuant to any agreement, arrangement, relationship,
understanding or otherwise, whether or not in writing,
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for the purpose of acquiring, owning or voting shares of the Company who
beneficially owns more than five per cent (5%) of the voting stock of the
Company for more than the "average market price" of the shares if the shares
have been beneficially owned by the person or persons for less than three (3)
years, unless the purchase or agreement to purchase is approved at a meeting of
shareholders by the affirmative vote of the holders of a majority of the voting
stock entitled to vote and not beneficially owned by such person or persons from
whom the proposed repurchase is to be made or the Company makes an offer, of at
least equal value per share, to all holders of shares of such class or series
and to all holders of any class or series into which the shares may be
converted.
13.02. DEFINITIONS. For the purposes of this Article, "average market
price" means the average closing sale price during the thirty trading days
immediately preceding the purchase of the shares in question, or if the person
or persons have commenced a tender offer or have announced an intention to seek
control of the Company, during the thirty trading days preceding the earlier of
the commencement of the tender offer or the making of the announcement, of a
share on the composite tape for New York Stock Exchange listed shares or, if the
shares are not quoted on the composite tape or not listed on the New York Stock
Exchange, on the principal United States securities exchange registered under
the Securities Exchange Act of 1934, as amended, on which the shares are listed
or, if the shares are not listed on any such exchange, on the National
Association of Securities Dealers, Inc. Automated Quotations National Market
System or, if the shares are not quoted on the National Association of
Securities Dealers, Inc. Automated Quotations National Market System, the
average closing bid quotation, during the thirty trading days preceding the
purchase of the shares in questions of a share on the National Association of
Securities Dealers, Inc. Automated Quotations System or any system then in use,
or if the person or persons have commenced a tender offer or have announced an
intention to seek control of the issuing public corporation, during the thirty
trading days preceding the earlier of the commencement of the tender offer or
the making of the announcement, except that if no quotation is available the
average market price is the fair market value on the date of purchase of the
shares in question of a share as determined in good faith by the Board of
Directors of the Company.
XIV. AMENDMENTS
14.01. AMENDMENT OF ARTICLES AND BYLAWS. Notwithstanding any other
provision of these Bylaws, Article Fifth of the Articles (Restated As of July
29, 1988) and Sections 2.02, 3.01, and 3.13 and Articles XII, XIII, and XIV of
these Bylaws shall not be altered, amended, supplemented, repealed, or
temporarily or permanently suspended, in whole or in part, or replacement Bylaw
provisions adopted without: (I) the affirmative vote of a majority of the
directors then in office; or (ii) the affirmative vote of seventy-five percent
(75%) or more of the outstanding shares of the Company entitled to vote
generally.
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CERTIFICATE
I, FAYE WIDENMANN, Vice President and Secretary of Pinnacle West Capital
Corporation, an Arizona Corporation, do HEREBY CERTIFY that the foregoing is a
true and correct copy of the Company's Bylaws, as amended, and that they are in
full force and effect as of the date hereof.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the
corporation this 15th day of December, 1999.
FAYE WIDENMANN
Secretary
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Pinnacle West Capital Corporation on Form S-8 of our reports dated March 4, 1999
and June 25, 1999, appearing in the Annual Report on Form 10-K of Pinnacle West
Capital Corporation for the year ended December 31, 1998 and in the Annual
Report on Form 11-K of Pinnacle West Capital Corporation Savings Plan for the
year ended December 31, 1998, respectively.
DELOITTE & TOUCHE LLP
Phoenix, Arizona
January 19, 2000
