SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Sierra Pacific Resources
(Name of Issuer)
Common Stock (par value $1)
(Title of Class of Securities)
826428104
(CUSIP Number)
Barbara J. Green
Franklin Resources, Inc.
One Franklin Parkway
San Mateo, California 94403-1906
(650) 312-2000
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
April 20, 2004
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-l(b)(3) or (4), check the following box [X].
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter the
disclosures provided in a prior cover page.
The information required in the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Franklin Resources, Inc.
2. CHECK THE APPROPRIATE BOX
IF A MEMBER OF A GROUP (a)[
] (b)[X]
3. SEC USE ONLY
4. SOURCE OF FUNDS
OO (See Item 3)
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) OR 2(e) [ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7. SOLE VOTING POWER
(See Item 5)
8. SHARED VOTING POWER
(See Item 5)
9. SOLE DISPOSITIVE POWER
(See Item 5)
10. SHARED DISPOSITIVE POWER
(See Item 5)
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
9,600,742 (See Item 5)
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
8.0%
14. TYPE OF REPORTING PERSON
HC
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Charles B. Johnson
2. CHECK THE APPROPRIATE BOX
IF A MEMBER OF A GROUP (a)[
] (b)[X]
3. SEC USE ONLY
4. SOURCE OF FUNDS
OO (See Item 3)
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) OR 2(e) [ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION
USA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7. SOLE VOTING POWER
(See Item 5)
8. SHARED VOTING POWER
(See Item 5)
9. SOLE DISPOSITIVE POWER
(See Item 5)
10. SHARED DISPOSITIVE POWER
(See Item 5)
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
9,600,640 (See Item 5)
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
8.0%
14. TYPE OF REPORTING PERSON
HC
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Rupert H. Johnson, Jr.
2. CHECK THE APPROPRIATE BOX
IF A MEMBER OF A GROUP (a)[
] (b)[X]
3. SEC USE ONLY
4. SOURCE OF FUNDS
OO (See Item 3)
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) OR 2(e) [ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION
USA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7. SOLE VOTING POWER
(See Item 5)
8. SHARED VOTING POWER
(See Item 5)
9. SOLE DISPOSITIVE POWER
(See Item 5)
10. SHARED DISPOSITIVE POWER
(See Item 5)
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
9,600,640 (See Item 5)
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
8.0%
14. TYPE OF REPORTING PERSON
HC
Item 1. Security and Issuer
The securities to which this statement relates are shares of Common Stock, par
value $1 per share (the "Shares"), of Sierra Pacific Resources, a Nevada
corporation (the "Issuer"). The principal executive offices of the Issuer are
located at 6100 Neil Road Reno, NV 89520-0400
Item 2. Identity and Background
(a) Name:
Franklin Resources, Inc. ("FRI")
(b) State of Organization:
Delaware
(c) Principal Business:
FRI is a diversified financial services company. Through its wholly-owned direct
and indirect subsidiary companies, FRI provides investment advisory, investment
management, administrative, distribution and related services to open-end and
closed-end investment companies, including a family of retail mutual funds,
institutional accounts and separate accounts.
Address of Principal Business/Principal Office:
One Franklin Parkway
San Mateo, CA 94403-1906
(d) Criminal Convictions:
None
(e) Civil Proceedings:
None
Item 2. Identity and Background
(a) Name:
Charles B. Johnson
(b) Business Address:
Franklin Resources, Inc.
One Franklin Parkway
San Mateo, California 94403-1906
(c) Principal Business:
Chairman of the Board/Member - Office of the
Chairman/Director/Principal Shareholder;
Franklin Resources, Inc., a diversified financial services company. Through its
wholly-owned direct and indirect subsidiary companies, FRI provides investment
advisory, investment management, administrative, distribution and related
services to open-end and closed-end investment companies, including a family of
retail mutual funds, institutional accounts and separate accounts.
(d) Criminal Convictions:
None
(e) Civil Proceedings:
None
Item 2. Identity and Background
(a) Name:
Rupert H. Johnson, Jr.
(b) Business Address:
Franklin Resources, Inc.
One Franklin Parkway
San Mateo, California 94403-1906
(c) Principal Business:
Vice Chairman/Member - Office of the Chairman/Director/Principal Shareholder;
Franklin Resources, Inc., a diversified financial services company. Through its
wholly-owned direct and indirect subsidiary companies, FRI provides investment
advisory, investment management, administrative, distribution and related
services to open-end and closed-end investment companies, including a family of
retail mutual funds, institutional accounts and separate accounts.
(d) Criminal Convictions:
None
(e) Civil Proceedings:
None
Item 2. Identity and Background
(a) The name, residence or business address, and the principal occupation or
employment and the name, principal business and address of any corporation or
other organization in which such employment is conducted, of each executive
officer and director and each controlling person, if any, of the reporting
persons named above is set forth in Exhibit A hereto. To the best knowledge of
the persons listed in Item 2 hereof, each person listed on Exhibit A is a United
States citizen except where otherwise noted and, during the last five years, no
person listed in Exhibit A attached (i) has been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors) or (ii) has
been a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject to,
a judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, federal or state securities laws or finding
any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration
The securities reported herein were acquired with funds of approximately
$112,950,741 (including brokerage commissions). All such funds were provided by
the working capital of the separate accounts and mutual funds managed and
advised by subsidiaries of FRI.
Item 4. Purpose of Transaction
The securities covered by this Statement were acquired for purpose of investment
by the separate accounts and mutual funds managed and advised by Franklin
Advisers, Inc., Franklin Advisory Services, LLC and Franklin Private Client
Group, Inc. (these advisory subsidiaries are hereafter referred to as the
"Franklin Advisors"), which are subsidiaries of FRI. Neither FRI, nor any
executive officer or director of FRI, has any present plans or intentions to
acquire or dispose of any securities of the Issuer other than on behalf of the
separate accounts and mutual funds managed and advised by the Franklin Advisors
for the purpose of investment.
The Franklin Advisors intend to withhold authority to vote for the three
nominees to the Board of Directors at the May 3rd, 2004 shareholder meeting and
encourage other shareholders to do the same. The primary duty of corporate
directors is to protect shareholder interests by overseeing the policies and
practices of the Company's management. In Sierra Pacific's case, we feel that
this Board has continuously failed in this duty.
The Franklin Advisors have been disappointed by the substantial decline in book
value of equity during the tenure of current management. Most specifically,
since Walt Higgins, current CEO and Chairman, was assigned to that post on
August 8, 2000, equity book value has declined by approximately 43%. The book
value of the Company at that time, according to the June 30, 2000 Form 10-Q, was
approximately $18.29 per share on 78.4 million shares outstanding. At year-end
2003, taking into account the dilutive impact of convertible securities, book
value has declined to $9.87 per share on 200.2 million shares.
Although the decline in book value has been partially due to operating losses
and write-offs of disallowed energy costs by regulators, management contributed
to this decline through numerous capital transactions that resulted in new
shares of common stock and $300 million of convertible debt issued substantially
below book value. With the current share price approximately 25% below the
Company's book value and management's apparent unwillingness to control costs or
reduce capital spending (as discussed below), the Franklin Advisors are
concerned that the Board of Directors will allow further dilution of
shareholders' equity in the future.
Sierra Pacific has been an electric utility company operating in an environment
of financial distress over the past three years. Because of the high power
prices encountered during the western energy crisis in 2000 and 2001, electric
power costs have risen substantially in Nevada and Sierra Pacific has found it
difficult to achieve full recovery of these higher costs through the rate making
process. One method that utilities can use to offset the rise in energy costs is
to reduce non-energy operating and maintenance expense. Many utilities have been
reducing this component of cost in recent years. Since 2000, the year Mr.
Higgins took office, non-energy operating and maintenance expense has risen
substantially, specifically on a per-unit basis. Thus, there appears to have
been no effort by current management to offset higher costs in other parts of
the business by lowering its controllable costs.
The cost of capital has greatly exceeded the return on investment opportunity
for Sierra Pacific the past couple years. Despite this fact, management has seen
its cash capital spending for utility plant increase from $302.0 million in 2001
to $328.1 million in 2003. In addition, management has stated its intention in
the Form 10-K filed on March 8, 2004 to increase its cash capital spending for
2004 to $487.4 million, representing a 49% increase over the level reported in
2003.
Over the prior five year period ending December 31, 2003, the value of Sierra
Pacific's common stock has fallen considerably. According to the 2004 proxy
statement, a $100 investment made in SRP on December 31, 1998 including the
reinvestment of all dividends would be worth only $21.98 on December 31, 2003. A
comparative investment in the Standard and Poor's 500 index would have been
worth $97.18 and an investment in the Dow Jones Utilities Index would have
yielded $103.56. We believe that this comparative performance is disgraceful.
The board has allowed current management to act in a manner that has contributed
to the lower shareholder net worth. All shareholders should be insistent about
the rights due to them under the law and do all they can to elect a board of
directors that would enhance shareholder values for all shareholders.
In the future, the accounts and mutual funds managed and advised by the Franklin
Advisors or other subsidiaries of FRI may decide to purchase additional shares
of the Common Stock or other securities of the Issuer. In addition, the accounts
and funds managed and advised by the Franklin Advisors and other subsidiaries of
FRI may dispose of any or all securities of the Issuer in any manner permitted
by applicable securities laws. The accounts and funds managed and advised by the
Franklin Advisors and other subsidiaries of FRI reserve the right to exercise
any and all of their respective rights as a stockholder of the Issuer in a
manner consistent with their equity interests.
Other than as described above, neither FRI or the Franklin Advisors nor any
executive officer or director of FRI or the Franklin Advisors, has any present
plans or proposals, which relate to or would result in:
(i) an extraordinary corporate transaction, such as a merger, reorganization or
liquidation, involving the Issuer or any of its subsidiaries;
(ii) the sale or transfer of a material amount of assets of the Issuer or any of
its subsidiaries;
(iii) any material change in the present capitalization or dividend policy of
the Issuer;
(iv) any other material change in the Issuer's business or corporate structure;
(v) changes in the Issuer's charter, bylaws or instruments corresponding thereto
or other actions, which may impede the acquisition of control of the Issuer by
any person;
(vi) causing a class of securities of the Issuer to be delisted from a national
securities exchange or to cease to be authorized to be quoted in an inter-dealer
quotation system of a registered national securities association;
(vii) a class of equity security of the Issuer becoming eligible for termination
of registration pursuant to Section 12(g)(4) of the Securities Exchange Act of
1934; or
(viii) any action similar to any of those enumerated above.
Item 5. Interest in Securities of the Issuer
(a-b) The separate accounts and mutual funds managed and advised by the Franklin
Advisors, which are subsidiaries of FRI are the owners of 9,600,640 shares of
the Common Stock representing approximately 8% of the outstanding shares of
Common Stock. Since the advisory contracts of FRI subsidiaries with its clients
grant them sole investment and voting power over the securities owned by its
advisory clients, FRI subsidiaries may be deemed to be, for purposes of Rule
13d-3 under the 1934 Act (the "1934 Act"), the beneficial owner of the
securities covered by this statement.
Charles B. Johnson and Rupert H. Johnson, Jr. (the "Principal Shareholders")
each own in excess of 10% of the outstanding Common Stock of FRI and are the
principal shareholders of FRI. FRI and the Principal Shareholders therefore may
be deemed to be, for purposes of Rule 13d-3 under the 1934 Act, the beneficial
owner of securities held by persons and entities advised by FRI or its
subsidiaries. FRI and the Principal Shareholders each disclaim any economic
interest or beneficial ownership in any of the securities covered by this
Statement owned by advisory clients of FRI subsidiaries.
Furthermore, FRI and the Principal Shareholders are of the view that they are
not acting as a "group" for purposes of Section 13(d) under the 1934 Act and
that they are not otherwise required to attribute to each other the "beneficial
ownership" of securities held by any of them or by any persons or entities
advised by FRI subsidiaries.
(c) See Exhibit B for the summary of transactions within the past sixty days.
(d) No person other than respective advisory clients of advisory subsidiaries of
FRI have the right to receive or the power to direct the receipt of dividends
from, or the proceeds of the sale of the securities being reported herein.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings, or Relationships with Respect
to Securities of the Issuer
Other than as disclosed above, no persons named in Item 2 herein, nor to the
best of such person's knowledge, no person named in Exhibit A hereto, has any
contract, arrangement, understanding or relationship (legal or otherwise) with
any person with respect to any securities of the Issuer, including, but not
limited to, transfer or voting of any securities, finders' fees, joint ventures,
loan or option arrangements, puts or calls, guarantees of profits, division of
profits or losses, or the giving or withholding of proxies.
Item 7. Materials to be Filed as Exhibits
Exhibit A - Executive Officers and Directors of Reporting Persons
Exhibit B - Summary of Transactions Within the last Sixty days
After reasonable inquiry, and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete, and correct.
Dated: April 20, 2004
Franklin Resources, Inc.
Charles B. Johnson
Rupert H. Johnson, Jr.
By: /s/BARBARA J. GREEN
Barbara J. Green
Vice President, Deputy General Counsel,
and Secretary, Franklin Resources, Inc.
Attorney in Fact for Charles B. Johnson pursuant to Power of Attorney attached
to this Schedule 13D
Attorney in Fact for Rupert H. Johnson, Jr. pursuant to Power of Attorney
attached to this Schedule 13D
JOINT FILING AGREEMENT
In accordance with Rule 13d-1(f) under the Securities Exchange Act of
1934, as amended, the undersigned hereby agree to the joint filing with each
other of the attached statement on Schedule 13D and to all amendments to such
statement and that such statement and all amendments to such statement is made
on behalf of each of them.
IN WITNESS WHEREOF, the undersigned hereby execute this agreement on April 20,
2004.
Franklin Resources, Inc.
Charles B. Johnson
Rupert H. Johnson, Jr.
By: /s/BARBARA J. GREEN
Barbara J. Green
Vice President, Deputy General Counsel,
and Secretary, Franklin Resources, Inc.
Attorney in Fact for Charles B. Johnson pursuant to Power of Attorney attached
to this Schedule 13D
Attorney in Fact for Rupert H. Johnson, Jr. pursuant to Power of Attorney
attached to this Schedule 13D
POWER OF ATTORNEY
CHARLES B. JOHNSON hereby appoints BARBARA J. GREEN his true and lawful
attorney-in-fact and agent to execute and file with the Securities and Exchange
Commission any Schedule 13D, any amendments thereto or any related documentation
which may be required to be filed in his individual capacity as a result of his
position as an officer, director or shareholder of Franklin Resources, Inc. and
granting unto said attorney-in-fact and agent, full power and authority to do
and perform each and every act and thing which he might or could do in person,
hereby ratifying and confirming all that said attorney-in- fact and agent, may
lawfully do or cause to be done by virtue hereof.
/s/CHARLES B. JOHNSON
POWER OF ATTORNEY
RUPERT H. JOHNSON, JR. hereby appoints BARBARA J. GREEN his true and lawful
attorney-in-fact and agent to execute and file with the Securities and Exchange
Commission any Schedule 13D, any amendments thereto or any related documentation
which may be required to be filed in his individual capacity as a result of his
position as an officer director or shareholder of Franklin Resources, Inc. and
granting unto said attorney-in-fact and agent, full power and authority to do
and perform each and every act and thing which he might or could do in person,
hereby ratifying and confirming all that said attorney-in- fact and agent, may
lawfully do or cause to be done by virtue hereof.
/s/RUPERT H. JOHNSON, JR.
Exhibit A
EXECUTIVE OFFICERS AND DIRECTORS
Name
Present Principal Occupation/Employment
Residence or Business Address
Penelope S. Alexander
Vice President, Human Resources U.S. - FRI
FRI
James R. Biao
Senior Vice President and Chief Financial Officer FRI
FRI
Jennifer J. Bolt
Senior Vice President and Chief Information Officer FRI
FRI
Harmon E. Burns
Vice Chairman, Member-Office of the Chairman/Director FRI
FRI
Charles Crocker
Director FRI
BEI Technologies, Inc.
One Post Street, Suite 2500, San Francisco, CA 94104
Martin L. Flanagan
Co-Chief Executive Officer and President - FRI
FRI
Holly E. Gibson
Vice President, Corporate Communications - FRI
FRI
Barbara J. Green
Vice President, Deputy General Counsel and Secretary - FRI
FRI
Donna S. Ikeda
Vice President, Human Resources - International - FRI
FRI
Robert D. Joffe
Director FRI
Cravath, Swaine & Moore LLP
Worldwide Plaza, 825 Eighth Avenue, New York, NY 10019
Charles B. Johnson
Chairman of the Board, Member-Office of the Chairman/Director/Principal
Shareholder - FRI
FRI
Gregory E. Johnson
Co-Chief Executive Officer and President FRI
FRI
Rupert H. Johnson, Jr.
Vice Chairman, Member-Office of the Chairman/Director/Principal
Shareholder FRI
FRI
Thomas H. Kean
Director FRI
Drew University
36 Madison Avenue, Madison, NJ 07940
Leslie M. Kratter
Senior Vice President and Assistant Secretary FRI
FRI
Kenneth A. Lewis
Vice President and Treasurer FRI
FRI
James A. McCarthy
Director - FRI
Private Investor
101 California Street, Suite 1400, San Francisco, CA 94111
Chutta Ratnathicam
Director FRI
CNF, Inc.
3240 Hillview Avenue, Palo Alto, CA 94304
Peter M. Sacerdote
Director - FRI
Limited Partner/Chair of Investment Committee, Goldman, Sachs Group, L.P.,
Investment banking
Goldman, Sachs & Co. 85 Broad Street, New York, NY 10004
Murray L. Simpson
Executive Vice President/General Counsel - FRI
FRI
Charles R. Sims
Vice President FRI
FRI
Anne M. Tatlock
Vice Chairman, Member-Office of the Chairman/Director - FRI
FRI
Louis E. Woodworth
Director - FRI
Private Investor/President, Alpine Corp.
Alpine Corp., 1505 7th Avenue, Seattle, WA 98119
FRI Franklin Resources, Inc.
One Franklin Parkway
San Mateo, CA 94403-1906
Parent Company of a number of investment advisers and administrative companies
providing investment advice and administrative services to the Franklin
Templeton Group of Funds, managed accounts and other investment products.
Exhibit B
Summary of Transactions Within the last Sixty days
Date Buy/Sell No. of Shares Price
3/25/04 Buy 9,000 $7.51
3/26/04 Buy 89,000 $7.4351
3/26/04 Buy 337,000 $7.31
Includes 2,733,099 common shares that would result upon the conversion of
424,453 Convertible Preferred Units and 19,000,000 Convertible bonds (as
computed under Rule 13(d)-3(d)(1)(i)). CUSIP 826428104 13D Page 1 of 17