Exhibit 10.1

·     

attract, retain and motivate key employees;

·     

relate compensation to performance and financial results and

·     

provide a portion of compensation in a variable rather than a fixed form.

2.1     

Award means, for a given calendar year, as to each Participant, an award granted under the Plan with respect to such year that provides the Participant an opportunity to earn an annual incentive payment under the Plan.

2.2     

Board means the Board of Directors of the Company.

2.3     

Cause means:

(a)     

if the Participant is party to an employment or change in control agreement that includes a definition of "Cause," the term "Cause" as defined in such agreement or

(b)     

if the Participant is not a party to an employment or change in control agreement that includes a definition of "Cause," a Participant's (i) willful and repeated refusal or failure to perform duties; (ii) willful or intentional act that has injured (or could reasonably be expected to injure) the reputation or business of the Company or a Subsidiary in any material respects; (iii) continued or repeated absence, unless due to serious injury or illness; (iv) conviction of (or pleading nolo contendere to) a felony; (v) commission of an act of fraud, embezzlement, theft or gross misconduct against the Company or a Subsidiary, (vi) violation of a material policy of the Company or a Subsidiary or (vii) other action or inaction that the Company deems to constitute "Cause" for purposes of the Plan.

2.4     

Change in Control means the earliest of the following to occur:

(a)     

any Person, excluding (i) the Company or any Subsidiary, (ii) a corporation or other entity owned, directly or indirectly, by the stockholders of the Company immediately prior to the transaction in substantially the same proportions as their ownership of stock of the Company, (iii) an employee benefit plan (or related 

trust) sponsored or maintained by the Company or any Subsidiary or (iv) an underwriter temporarily holding securities pursuant to an offering of such securities ("Change in Control Person") is the beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of 20% or more of the combined voting power of the then outstanding voting securities eligible to vote generally in the election of directors of the Company; provided, however, that no Change in Control will be deemed to have occurred as a result of a change in ownership percentage resulting solely from an acquisition of securities by the Company;

(b)            

consummation of a merger, consolidation, reorganization or share exchange, or sale of all or substantially all of the assets, of the Company or Idaho Power Company (a "Qualifying Transaction"), unless, immediately following such Qualifying Transaction, all of the following have occurred: (i) all or substantially all of the beneficial owners of the Company immediately prior to such Qualifying Transaction beneficially own in substantially the same proportions, directly or indirectly, more than 50% of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors of the corporation or other entity resulting from such Qualifying Transaction (including, without limitation, a corporation or other entity which, as a result of such transaction, owns the Company or all or substantially all of the Company's assets either directly or through one or more subsidiaries) (as the case may be, the "Successor Entity"), (ii) no Change in Control Person is the beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of 20% or more of the combined voting power of the then outstanding voting securities eligible to vote generally in the election of directors of the Successor Entity and (iii) at least a majority of the members of the board of directors of the Successor Entity are Incumbent Directors;

a complete liquidation or dissolution of the Company or Idaho Power Company or

within a 24-month period, individuals who were directors of the Board immediately before such period ("Incumbent Directors") cease to constitute at least a majority of the directors of the Board; provided, however, that any director who was not a director of the Board at the beginning of such period shall be deemed to be an Incumbent Director if the election or nomination for election of such director was approved by the vote of at least two-thirds of the directors of the Board then still in office (i) who were in office at the beginning of the 24-month period or (ii) whose election or nomination for election was so approved, in each case, unless such individual was elected or nominated as a result of an actual or threatened election contest or as a result of an actual or threatened solicitation of proxies or consents by or on behalf of any Change in Control Person other than the Board.

2.5     

Committee means the Compensation Committee of the Board.

2.6     

Coverage Period means the period commencing on the date of a Change in Control and ending on the last day of the calendar year in which the Change in Control occurs.

2.7     

Disability means termination of a Participant's employment with the Company and/or its Subsidiaries, as applicable, if the Participant is eligible to receive benefits under the Long-Term Disability Program maintained by the Company or its Subsidiaries.

2.8     

Employee means an individual who is on the payroll of the Company or a Subsidiary, who is not covered by any collective bargaining agreement to which the Company or any of its Subsidiaries is a party and is classified in the payroll system as a regular, full-time, part-time or temporary employee.

2.9     

Exchange Act means the Securities Exchange Act of 1934, as amended.

2.10     

Participant means an Employee selected for participation in this Plan.

2.11     

Person shall have the meaning ascribed to such term in Section 3(a)(9) of the Exchange Act.

2.12     

Pre-Change in Control Board means the Board, as composed prior to a Change in Control.

2.13     

Retirement means a Participant's termination from employment with the Company and/or its Subsidiaries, as applicable, if the date of termination occurs on or after attainment of any of the following: (a) age 62, (b) age 55 with 10 years of service or (c) 30 years of service.

2.14     

Subsidiary means

(a)     

any corporation more than fifty (50%) percent of the outstanding securities having ordinary voting power of which shall at the time be owned or controlled, directly or indirectly, by the Company or one or more of its Subsidiaries or by the Company and one or more of its Subsidiaries or

any partnership, limited liability company, association, joint venture or similar business organization more than fifty (50%) percent of the ownership interests having ordinary voting power of which shall at the time be so owned or controlled.

2.15    

Target Award Amount means the amount payable if the Participant achieves target performance levels pursuant to the Plan.

(a)     

If a Participant's employment is terminated for any reason other than Retirement, death or Disability, except as provided in Section 7 herein and unless otherwise determined by the Committee, (i) with respect to the Participant's Award relating to the calendar year in which the employment termination occurs, such Award will be cancelled and the Participant will not be eligible to receive a payment under the Plan with respect to that calendar year and (ii) with respect to the Participant's Award relating to the prior calendar year (if such Award was either not yet approved or approved but not yet paid as of the date of employment termination), such Award will remain in effect, the amount payable to the Participant (if any) shall be determined in accordance with Section 5 hereof based on actual performance through the end of the prior calendar year and any amount payable to the Participant shall be paid pursuant to Section 8 hereof at the same time such amount would have been paid had the Participant remained employed through the payment date.

(b)     

Except as otherwise provided in  Section 7 herein, if a Participant's employment is terminated due to Retirement, death or Disability, (i) with respect to the Participant's Award relating to the calendar year in which the employment termination occurs, (A) such Award shall remain in effect, (B) the amount payable to the Participant (if any) shall be determined by multiplying (I) the amount that would have been paid if the Participant had remained employed through the payment date, determined in accordance with Section 5 hereof based on actual performance through the end of the calendar year, by (II) a fraction, the numerator of which equals the number of days the employee worked in the calendar year in which the termination of employment occurs and the denominator of which is 365 and (C) any amount payable to the Participant shall be paid pursuant to Section 8 hereof at the same time such amount(s) would have been paid had the Participant remained employed through the payment date and (ii) with respect to the Participant's Award relating to the prior calendar year (if such Award was either not yet approved or approved but not yet paid as of the date of employment termination), (A) such Award shall remain in effect, (B) the amount payable to the Participant (if any) shall be determined in accordance with Section 5 hereof based on actual performance through the end of the calendar year to which the Award relates and (C) any amount payable to the Participant shall be paid pursuant to Section 8 hereof at the same time such amount would have been paid had the Participant remained employed through the payment date.

(c)     

No Award shall be paid to a Participant whose employment is terminated for Cause.

(d)     

For purposes of the Plan, (i) transfer of employment of a Participant between the Company and any one of its Subsidiaries (or between Subsidiaries) and transfer of employment to a Successor Entity or other successor of the Company or a Subsidiary shall not be deemed a termination of employment unless so determined by the Committee and (ii) if a Participant is employed by the Company and a Subsidiary or more than one Subsidiary, a Participant shall not be deemed to have terminated employment unless the Participant's employment with each such entity terminates.

(a)     

If a Change in Control involving a Successor Entity occurs, the Pre-Change in Control Board may require that the Successor Entity (i) assume or otherwise continue all or any part of the Awards that are outstanding at the time of the Change in Control or (ii) substitute outstanding Awards with awards that are no less favorable to Participants (as determined in the sole discretion of the Pre-Change in Control Board).

(b)     

If a Successor Entity refuses to assume or continue such Awards or to provide substitute awards that are deemed acceptable by the Pre-Change in Control Board or if a Change in Control not involving a Successor Entity occurs and the Pre-Change in Control Board determines that the Change in Control would adversely affect outstanding Awards, the Pre-Change in Control Board, in its sole discretion, may (i) with respect to outstanding Awards that relate to the calendar year in which the Change in Control occurs, provide for the payment of all or a portion of the outstanding Awards (at target or another level determined by the Pre-Change in Control Board), (ii) with respect to outstanding Awards that relate to the prior calendar year and that were either not yet approved or approved but not yet paid as of the date of the Change in Control, provide for the accelerated payment of the outstanding Awards (at target or another level determined by the Pre-Change in Control Board) or (iii) take such other action with respect to outstanding Awards, which action need not be consistent among Participants, as it deems appropriate (including taking no action).

(c)     

The Pre-Change in Control Board may make or cause to be made such changes to performance goals and other terms of Awards as it may deem appropriate to reflect or adjust for changes resulting from a Change in Control.

(d)     

If a Participant's employment is terminated for any reason other than Cause during the Coverage Period, (i) with respect to outstanding Awards that relate to the calendar year in which the Change in Control occurs, the Participant shall be paid either (A) a prorated Award determined by multiplying the Participant's Target Award Amount (or another amount determined by the Pre-Change in Control Board) by a fraction, the numerator of which equals the number of days the employee worked in the calendar year in which the termination of employment occurs and the denominator of which is 365 or (B) if so determined by the Pre-Change in Control Board, a full Award in an amount determined by the Pre-Change in Control Board and (ii) with respect to outstanding Awards that relate to the prior calendar year and that were either not yet approved or approved but not yet paid as of the date of the Change in Control, provide for the

accelerated payment of outstanding Awards (at target or another level determined by the Pre-Change in Control Board).

(e)    

Any Award paid pursuant to this Section 7 shall be paid on the date selected by the Pre-Change in Control Board, provided that such date shall in no event be later than the earlier of (i) the date such payment would have been made in the ordinary course and (ii) 2½ months following the event triggering the payment (i.e. , the Change in Control or termination of employment).

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Operational/Customer Service Goals – 40%

·     

Net Income at Idaho Power Company – 40%

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IDACORP Consolidated Net Income – 20%

Performance Level

CRI Goal

Qualifying Multiplier

Threshold

%

7.5%

Target

%

15%

Maximum

%

30%

Performance Level

Other O&M Expense

Qualifying Multiplier

Threshold

$

7.5%

Target

$

15%

Maximum

$

30%

Performance Level

Interruptions

Qualifying Multiplier

Threshold

5%

Target

10%

Maximum

20%

Performance Level

Idaho Power Company Net Income

Qualifying Multiplier

Threshold

$

20%

Target

$

40%

Maximum

$

80%

Performance Level

Consolidated IDACORP Net Income

Qualifying Multiplier

Threshold

$

10%

Target

$

20%

Maximum

$

40%