Avista Corporation
$400,000,000
Medium-Term Notes, Series D
Distribution Agreement
----------------------
, 1999
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[Insert name and address of Agent]
[Insert name and address of Agent]
[Insert name and address of Agent]
Ladies and Gentlemen:
Avista Corporation, a Washington corporation (the
"Company"), proposes to issue and sell from time to time its
Medium-Term Notes, Series D (the "Securities") in an aggregate
principal amount up to $400,000,000 and agrees with each of you
(individually, an "Agent", and collectively, the "Agents") as set
forth in this Agreement.
Subject to the terms and conditions stated herein and
to the reservation by the Company of the right to sell Securities
directly on its own behalf, the Company hereby (i) appoints each
Agent as an agent of the Company for the purpose of soliciting
and receiving offers to purchase Securities from the Company
pursuant to Section 2(a) hereof and (ii) agrees that, except as
otherwise contemplated herein, whenever it determines to sell
Securities directly to any Agent as principal, it will enter into
a separate agreement, substantially in the form of Annex I hereto
(each a "Terms Agreement"), relating to such sale in accordance
with Section 2(b) hereof.
The Securities will be issued as a series under the
Company's Indenture, dated as of April 1, 1998, to The Chase
Manhattan Bank, as trustee (the "Trustee") as it will be
supplemented by an Officer's Certificate dated , 1999
(said Indenture, as so supplemented and as it may be amended and
further supplemented being hereinafter referred to as the
"Indenture"). The Securities shall have the maturity ranges,
interest rates, if any, redemption provisions and other terms set
forth in the Prospectus referred to below as it may be amended or
supplemented from time to time. The Securities will be issued,
and the terms and rights thereof established, from time to time
by the Company in accordance with the Indenture.
1. The Company represents and warrants to, and agrees
with, each Agent that:
(a) The Company has carefully prepared in
conformity with the requirements of the Securities Act of
1933, as amended (the "Act"), and the applicable rules and
regulations of the Securities and Exchange Commission (the
"Commission") (i) a registration statement on Form S-3 (File
No. 333- ) (the "Registration Statement") for the
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registration of $400,000,000 in aggregate principal amount
of its Debt Securities. The Registration Statement has
become effective and no stop order suspending the
effectiveness of the Registration Statement has been issued
and no proceeding for that purpose has been initiated or
threatened by the Commission. No Debt Securities registered
under the Registration Statement have been issued. A
prospectus supplement setting forth the terms of the
Securities and of their sale and distribution (the
"Prospectus Supplement") has been or will be so prepared and
will be filed pursuant to Rule 424 under the Act. The
Registration Statement (including exhibits, but excluding
the Statement of Eligibility on Form T-1) in the form in
which it became effective, and as amended to the date
hereof, is herein referred to as the "Registration
Statement"; the prospectus included as a part of the
Registration Statement, as such prospectus may have been
amended to the date hereof, is hereinafter referred to as
the "Basic Prospectus"; and the Basic Prospectus, as
supplemented by the Prospectus Supplement, is herein
referred to as the "Prospectus"; provided, however, that (i)
any reference herein to the terms "Registration Statement",
"Basic Prospectus" or "Prospectus" shall be deemed to refer
to and include the documents incorporated therein by
reference pursuant to Item 12 of Form S-3 under the Act,
(ii) any reference to any amendment or supplement to the
Prospectus shall be deemed to refer to and include any
documents filed after the date of the Prospectus pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and so
incorporated by reference, (iii) any reference to the
Prospectus as amended or supplemented shall be deemed to
refer to and include the Prospectus as amended or
supplemented (including by any supplement to the Prospectus
that sets forth only the terms of a particular tranche of
the Securities (a "Pricing Supplement") filed in accordance
with Section 4(a) hereof) in relation to the Securities sold
pursuant to this Agreement, in the form filed with the
Commission pursuant to Rule 424(b) under the Act and in
accordance with Section 4(a) hereof, including any documents
incorporated by reference therein as of the date of such
filing) and (iv) no prospectus supplement to the Basic
Prospectus which relates to securities of the Company other
than the Securities shall be deemed to be a part of the
Basic Prospectus or the Prospectus;
(b) The Registration Statement when it became
effective complied, and the Prospectus and any amendments or
supplements thereto will comply, in all material respects
with the applicable provisions of the Act and the Trust
Indenture Act of 1939, as amended (the "Trust Indenture
Act"), and the applicable rules and regulations of the
Commission thereunder and do not and will not, as of the
applicable effective date in the case of the Registration
Statement and any amendment thereto, as of the applicable
filing date in the case of the Prospectus and any supplement
thereto and as of each applicable date referred to in
Section 4(g) hereof, contain an untrue statement of a
material fact or omit to state a material fact required to
be stated therein or necessary to make the statements
therein not misleading; provided, however, that the Company
makes no representations or warranties as to information
contained in or omitted from any such document in reliance
upon and in conformity with information furnished in writing
to the Company by any Agent specifically for use in the
preparation thereof;
(c) The documents incorporated by reference in
the Prospectus, when they became effective or were filed
with the Commission, as the case may be, complied in all
material respects with the requirements of the Act or the
Exchange Act, and the applicable rules and regulations of
the Commission thereunder, and none of such documents
included an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of
the circumstances under which they were made, not
misleading; and any further documents so filed and
incorporated by reference in the Prospectus, or any
amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case may
be, will comply in all material respects with the applicable
requirements of the Act or the Exchange Act, and the
applicable rules and regulations of the Commission
thereunder, and will not contain an untrue statement of a
material fact or omit to state a material fact required to
be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that the
Company makes no representations or warranties as to
information contained in or omitted from any such document
in reliance upon and in conformity with information
furnished in writing to the Company by any Agent
specifically for use in the preparation thereof;
(d) Except as set forth in or contemplated by the
Prospectus as amended or supplemented, (i) since the date as
of which information is given in the Prospectus as amended
or supplemented there has not been any material adverse
change in the condition of the Company and its subsidiaries
as a whole, financial or otherwise, (ii) since the date of
the Prospectus as amended or supplemented there has not been
any transaction entered into by the Company or any
subsidiary thereof which is material to the Company and its
subsidiaries as a whole other than transactions in the
ordinary course of business and (iii) neither the Company
nor any of its subsidiaries has any contingent obligation
which is material to the Company and its subsidiaries as a
whole;
(e) The Securities have been duly authorized [(it
being understood that, as of the Commencement Date (as
defined below), no floating rate Security has been
authorized)], and when issued and delivered pursuant to this
Agreement and any Terms Agreement, and duly authenticated by
the Trustee pursuant to the Indenture, will have been duly
executed, authenticated, issued and delivered and will
constitute valid and legally binding obligations of the
Company entitled to the benefits provided by the Indenture
(it being understood that no floating rate Security may be
issued without further authorization by the Board of
Directors of the Company); the Indenture has been duly
authorized and qualified under the Trust Indenture Act and
constitutes a valid and legally binding instrument; the
Indenture is, and the Securities, when authenticated, issued
and delivered as aforesaid, will be, enforceable in
accordance with their respective terms, except to the extent
that enforcement thereof may be limited by any applicable
bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or other laws affecting
creditors' rights generally, by general principles of equity
(whether asserted in an action in equity or at law) and by
rules of law governing specific performance, injunctive
relief, foreclosure, receivership and other equitable
remedies; and the Indenture and the Securities of any
particular tranche will conform in all material respects to
the descriptions thereof contained in the Prospectus as
amended or supplemented to relate to the Securities of such
tranche;
(f) The issue and sale of the Securities, the
compliance by the Company with all of the provisions of the
Securities, the Indenture, this Agreement and any Terms
Agreement, and the consummation by the Company of the
transactions herein and therein contemplated will not result
in a breach or violation of any of the terms or provisions
of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or
instrument to which the Company is a party or by which the
Company is bound or to which any of the property or assets
of the Company is subject, nor will such action result in
any violation of the provisions of any statute or the
Restated Articles of Incorporation, as amended, or the
Bylaws, as amended, of the Company or, to the best of the
Company's knowledge, information or belief, any order, rule
or regulation of any court or any federal or state
regulatory authority or other governmental agency or body
having jurisdiction over the Company or any of its
properties; and no consent, approval, authorization, order,
registration or qualification of or with any court or
governmental agency or body is required for the solicitation
of offers to purchase Securities and the issue and sale of
the Securities or the consummation by the Company of the
other transactions contemplated by this Agreement, any Terms
Agreement or the Indenture, except such as have been, or
will have been prior to the Commencement Date (as defined in
Section 3 hereof), obtained under the Act or the Trust
Indenture Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under
state securities or Blue Sky laws in connection with the
solicitation by such Agent of offers to purchase Securities
from the Company and with purchases of Securities by such
Agent as principal, as the case may be, and such consents,
approvals, authorizations, filings or registrations as may
be required by the Washington Utilities and Transportation
Commission, the California Public Utilities Commission, the
Idaho Public Utilities Commission and the Public Utility
Commission of Oregon, in each case in the manner
contemplated hereby;
(g) Except as set forth in or contemplated by the
Prospectus, as amended or supplemented, there are no legal
or governmental proceedings pending to which the Company or
any of its subsidiaries is a party or to which any property
of the Company or any of its subsidiaries is subject, which,
if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a
material adverse effect on the consolidated financial
position, stockholders' equity or results of operations of
the Company and its subsidiaries, and, to the best of the
Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by
others; and
(h) Immediately after any sale of Securities by
the Company hereunder or under any Terms Agreement, the
aggregate amount of Securities which shall have been issued
and sold by the Company hereunder or under any Terms
Agreement that shall have been issued and sold pursuant to
the Registration Statement will not exceed the amount of
Securities registered under the Registration Statement.
2. (a) On the basis of the representations and
warranties, and subject to the terms and conditions herein set
forth, each of the Agents hereby severally and not jointly
agrees, as agent of the Company, to use its reasonable best
efforts to solicit and receive offers to purchase the Securities
from the Company upon the terms and conditions set forth in the
Prospectus as amended or supplemented from time to time.
The Company reserves the right, in its sole discretion,
to instruct the Agents to suspend at any time, for any period of
time or permanently, the solicitation of offers to purchase
Securities; provided that the suspension period shall not
commence until such time as no Agent shall then hold any
Securities purchased from the Company as principal. Upon receipt
of at least one business day's prior notice from the Company, the
Agents will forthwith suspend solicitations of offers to purchase
Securities from the Company until such time as the Company has
advised the Agents that such solicitation may be resumed. While
such solicitation is suspended, the Company shall not be required
to deliver any opinions, letters or certificates in accordance
with Sections 4(i), 4(j), 4(k), 4(l) and 4(m); provided, however,
that if the Registration Statement or the Prospectus is amended
or supplemented during the period of suspension (other than by an
amendment or supplement providing solely for a change in the
interest rates, redemption provisions, amortization schedules or
maturities offered on the Securities or for a change the Agents
deem to be immaterial), no Agent shall be required to resume
soliciting offers to purchase Securities, or shall purchase
Securities from the Company as principal, until the Company has
delivered such opinions, letters and certificates as, but for
such suspension, would have been required by Sections 4(i), 4(j),
4(k), 4(l) and 4(m); and provided, further, that the Company
shall not be so required to deliver more than one opinion, letter
or certificate pursuant to any of Sections 4(i), 4(j), 4(k), 4(l)
and 4(m) and that no such opinion, letter or certificate shall be
required to speak as of any date, or to cover any period ending
on a date, prior to the later of (i) the end of the period
covered by the Company's latest Annual Report on Form 10-K which
has been filed with the Commission, or (ii) the end of the latest
quarterly period with respect to which opinions, letters or
certificates have previously been delivered to the Agents in
accordance with such Sections.
So long as this Agreement shall remain in effect with
respect to any Agent, the Company shall not, without the consent
of such Agent, which consent shall not unreasonably be withheld,
solicit or accept offers to purchase, or sell, any debt
securities with a maturity at the time of original issuance of
nine months to 40 years except pursuant to (i) this Agreement or
any Terms Agreement, (ii) the Distribution Agreement, dated April
24, 1998, among The Washington Water Power Company and the agents
named therein, (iii) a transaction not constituting a public
offering under the Act and (iv) a firm commitment underwriting
pursuant to an underwriting agreement that does not provide for a
continuous offering of debt securities. However, the Company
reserves the right to sell, and may solicit and accept offers to
purchase, Securities directly on its own behalf, and, in the case
of any such sale not resulting from a solicitation made by any
Agent, no commission will be payable with respect to such sale.
These provisions shall not limit Section 4(f) hereof or any
similar provisions included in any Terms Agreement.
Procedural details relating to the issue and delivery
of Securities, the solicitation of offers to purchase Securities
and the payment in each case therefor shall be as set forth in
the Administrative Procedure attached hereto as Annex II as it
may be amended from time to time by written agreement between the
Agents and the Company (the "Administrative Procedure"). The
provisions of the Administrative Procedure shall apply to all
transactions contemplated hereunder other than those made
pursuant to a Terms Agreement. Each Agent and the Company agree
to perform the respective duties and obligations specifically
provided to be performed by each of them in the Administrative
Procedure. The Company will furnish to the Trustee a copy of the
Administrative Procedure as from time to time in effect.
The Company reserves the right, in its sole discretion,
to instruct the Agents to suspend at any time after the
Commencement Date (as defined in Section 3), for any period of
time or permanently, the solicitation of offers to purchase the
Securities. As soon as practicable, but in any event not later
than one business day in New York City, after receipt of notice
from the Company, the Agents will suspend solicitation of offers
to purchase Securities from the Company until such time as the
Company has advised the Agents that such solicitation may be
resumed.
The Company agrees to pay each Agent a commission, at
the time of settlement of any sale of a Security by the Company
as a result of a solicitation made by such Agent, in an amount
equal to the following applicable percentage of the principal
amount of such Security sold:
Commission
(percentage of
aggregate
principal amount
Range of Maturities of Securities sold)
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From 9 months to less than 1 year 0.125%
From 1 year to less than 18 months 0.150%
From 18 months to less than 2 years 0.200%
From 2 years to less than 3 years 0.250%
From 3 years to less than 4 years 0.350%
From 4 years to less than 5 years 0.450%
From 5 years to less than 6 years 0.500%
From 6 years to less than 7 years 0.550%
From 7 years to less than 10 years 0.600%
From 10 years to less than 15 years 0.625%
From 15 years to less than 20 years 0.700%
From 20 years to less than 30 years 0.750%
From 30 years to 40 years 0.875%
(b) Each sale of Securities to any Agent as principal
shall be made in accordance with the terms of this Agreement and
(unless the Company and such Agent shall otherwise agree in
writing or orally) a Terms Agreement which will provide for the
sale of such Securities to, and the purchase thereof by, such
Agent; it being understood that (unless the Company and such
Agent shall otherwise agree in writing) any such oral agreement
relating to the sale of Securities to such Agent as principal (i)
shall be deemed to incorporate all the terms and conditions set
forth in the form of Terms Agreement attached hereto as Annex I
and (ii) shall be promptly confirmed in writing. A Terms
Agreement may also specify certain provisions relating to the
reoffering of such Securities by such Agent. The commitment of
any Agent to purchase Securities as principal, whether pursuant
to any Terms Agreement or otherwise, shall be deemed to have been
made on the basis of the representations and warranties of the
Company herein contained and shall be subject to the terms and
conditions herein set forth. Each Terms Agreement shall specify
the principal amount of Securities to be purchased by any Agent
pursuant thereto, the price to be paid to the Company for such
Securities, any provisions relating to rights of, and default by,
underwriters acting together with such Agent in the reoffering of
the Securities and the time and date and place of delivery of and
payment for such Securities. Such Terms Agreement shall also
specify any requirements for opinions of counsel, accountants'
letters and officers' certificates pursuant to Section 4 hereof.
For each sale of Securities to an Agent as principal
that is not made pursuant to a Terms Agreement, the procedural
details relating to the issue and delivery of such Securities and
payment therefor shall be as set forth in the Administrative
Procedure and the Company agrees to pay such Agent a commission
(or grant an equivalent discount) as provided in Section 2(a)
hereof and in accordance with the schedule set forth therein.
Each time and date of delivery of and payment for
Securities to be purchased by an Agent as principal, whether set
forth in a Terms Agreement or in accordance with the
Administrative Procedure, is referred to herein as a "Time of
Delivery."
3. The documents required to be delivered pursuant to
Section 6 hereof on the Commencement Date (as defined below)
shall be delivered to the Agents at the offices of Xxxxxx Xxxx &
Priest LLP, 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx, at 11:00
a.m., New York City time, on the date of this Agreement, which
date and time of such delivery may be postponed by agreement
between the Agents and the Company but in no event shall be later
than the day prior to the date on which solicitation of offers to
purchase Securities is commenced or on which any Terms Agreement
is executed by the parties thereto (such time and date being
referred to herein as the "Commencement Date").
4. The Company covenants and agrees with each Agent:
(a) (i) To make no amendment or supplement to the
Registration Statement or the Prospectus (A) prior to the
Commencement Date to which any Agent shall reasonably
disapprove by notice to the Company promptly after
reasonable notice thereof or (B) after the date of any Terms
Agreement or other agreement by an Agent to purchase
Securities as principal and prior to the related Time of
Delivery which shall be reasonably disapproved by notice to
the Company by any Agent party to such Terms Agreement or so
purchasing as principal promptly after reasonable notice
thereof; (ii) to prepare, with respect to any Securities to
be sold through or to such Agent pursuant to this Agreement,
a Pricing Supplement with respect to such Securities in a
form previously approved by such Agent and to file such
Pricing Supplement pursuant to Rule 424(b)(3) under the Act
not later than the close of business of the Commission on
the third business day following the date on which such
Pricing Supplement is first used; (iii) to make no amendment
or supplement to the Registration Statement or Prospectus,
other than any Pricing Supplement, at any time prior to
having afforded each Agent a reasonable opportunity to
review and comment thereon; (iv) to file in a timely manner
all reports and any definitive proxy or information
statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Exchange Act for so long as the delivery of a prospectus
is required in connection with the offering or sale of the
Securities, and during such period to advise such Agent,
promptly after the Company received notices thereof, of the
time when any amendment to the Registration Statement has
been filed or has become effective or any supplement to the
Prospectus or any amended Prospectus (other than any Pricing
Supplement that relates to Securities not purchased through
or by such Agent) has been filed with the Commission, of the
issuance by the Commission of any stop order or of any order
preventing or suspending the use of any prospectus relating
to the Securities, of the suspension of the qualification of
the Securities for offering or sale in any jurisdiction, of
the initiation or threatening of any proceeding for any such
purpose, or of any request by the Commission for the
amendment or supplement of the Registration Statement or
Prospectus or for additional information; (v) in the event
of the issuance of any such stop order or of any such order
preventing or suspending the use of any such prospectus or
suspending any such qualification, to use promptly every
reasonable effort to obtain its withdrawal; and (vi) to
notify the Agents promptly of any change in the rating
assigned by any nationally recognized statistical rating
organization to any debt securities of the Company
(including the Securities) of the Company, or the public
announcement by any nationally recognized statistical rating
organization that it has under surveillance or review, with
possible negative implications, its rating of the Securities
or any such debt securities, or the withdrawal by any
nationally recognized statistical rating organization of its
rating of the Securities or any such debt securities.
(b) Promptly from time to time to take such
action as such Agent may reasonably request to qualify the
Securities for offering and sale under the securities laws
of such jurisdictions as may be approved by the Company and
to comply with such laws so as to permit the continuance of
sales and dealings therein for as long as may be necessary
to complete the distribution or sale of the Securities;
provided, however, that in connection therewith the Company
shall not be required to qualify as a foreign corporation or
to file a general consent to service of process in any
jurisdiction, or to comply with any other requirement
reasonably deemed by the Company to be unduly burdensome;
(c) To furnish such Agent with copies of the
Registration Statement and each amendment thereto, and with
copies of the Prospectus as each time amended or
supplemented, other than any Pricing Supplement (except as
provided in the Administrative Procedure), in the form in
which it is filed with the Commission pursuant to Rule 424
under the Act, in such quantities as such Agent may
reasonably request from time to time, and with copies of the
documents incorporated by reference therein; and, if the
delivery of a prospectus is required at any time in
connection with the offering or sale of the Securities
(including Securities purchased from the Company by such
Agent as principal) and if at such time any event shall have
occurred as a result of which the Prospectus as then amended
or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary
in order to make the statements therein, in the light of the
circumstances under which they were made when such
Prospectus is delivered, not misleading, or, if for any
other reason it shall be necessary at such time to amend or
supplement the Prospectus or to file under the Exchange Act
any document incorporated by reference in the Prospectus in
order to comply with the Act, the Exchange Act or the Trust
Indenture Act, to notify such agent and request such Agent,
in its capacity as agent of the Company, to suspend
solicitation of offers to purchase Securities from the
Company (and, if so notified, such Agent shall cease such
solicitations as soon as practicable, but in any event not
later than one business day later); and if the Company shall
decide to amend or supplement the Registration Statement or
the Prospectus as then amended or supplemented, to so advise
such Agent promptly by telephone (with confirmation in
writing) and to prepare and cause to be filed promptly with
the Commission an amendment or supplement to the
Registration Statement or the Prospectus as then amended or
supplemented or to file any document under the Exchange Act
that will correct such statement or omission or effect such
compliance; provided, however, that, should such event
relate solely to activities of any Agent, then such Agent
shall assume the expense of preparing and furnishing any
such amendment or supplement; and provided, further, that if
at such time such Agent continues to own Securities
purchased from the Company by such Agent as principal or
such Agent is otherwise required to deliver a prospectus in
respect of transactions in the Securities, the Company shall
promptly prepare and file with the Commission such an
amendment or supplement. For the purposes of this
subsection (c), the Company shall be entitled to assume that
a Prospectus shall no longer be required to be delivered
under the Act from and after the date six months from the
date of the purchase thereof by an Agent as principal,
unless it shall have received notice from such Agent to the
contrary;
(d) To make generally available to its security
holders as soon as practicable, but in any event not later
than eighteen months after (i) the effective date of the
Registration Statement, (ii) the effective date of each
post-effective amendment to the Registration Statement, and
(iii) the date of each filing by the Company with the
Commission of an Annual Report on Form 10-K that is
incorporated by reference in the Registration Statement, an
earning statement of the Company and its subsidiaries (which
need not be audited) complying with Section 11(a) of the Act
and the rules and regulations of the Commission thereunder
(including, at the option of the Company, Rule 158);
(e) For the period ending five years from the
date any Securities are sold by the Company pursuant to an
offer solicited by such Agent, to furnish to such Agent
copies of all reports or other communications (financial or
other) furnished to stockholders, and deliver to such Agent
(i) as soon as they are available, copies of any reports and
financial statements furnished to or filed with the
Commission or any national securities exchange on which any
class of securities of the Company is listed and (ii) such
additional information concerning the business and financial
condition of the Company as such Agent may from time to time
reasonably request (such financial statements to be on a
consolidated basis to the extent the accounts of the Company
and its subsidiaries are consolidated in reports furnished
to its stockholders generally or to the Commission);
(f) That, from the date of any Terms Agreement
with such Agent or other agreement by such Agent to purchase
Securities as principal and continuing to and including the
earlier of (i) the termination of the trading restrictions
for the Securities purchased thereunder, as notified to the
Company by such Agent and (ii) the related Time of Delivery,
it will not offer, sell, contract to sell or otherwise
dispose of any debt securities of the Company in a public
offering which both mature more than nine months after such
Time of Delivery and are substantially similar to the
Securities, without the prior written consent of such Agent;
(g) That each acceptance by the Company of an
offer to purchase Securities hereunder (including any
purchase by such Agent as principal not pursuant to a Terms
Agreement), and each execution and delivery by the Company
of a Terms Agreement with such Agent, shall be deemed to be
an affirmation to such Agent that the representations and
warranties of the Company contained in or made pursuant to
this Agreement are true and correct as of the date of such
acceptance or of such Terms Agreement, as the case may be,
as though made at and as of such date, and an undertaking
that such representations and warranties will be true and
correct as of the settlement date for the Securities
relating to such acceptance or as of the Time of Delivery
relating to such sale, as the case may be, as though made at
and as of such date (except that such representations and
warranties shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented
relating to such Securities);
(h) That reasonably in advance of each time the
Registration Statement or the Prospectus shall be amended or
supplemented (other than by a Pricing Supplement) and each
time a document filed under the Act or the Exchange Act is
incorporated by reference into the Prospectus, and each time
the Company sells Securities to such Agent as principal
pursuant to a Terms Agreement and such Terms Agreement
specifies the delivery of an opinion or opinions by Xxxxxxxx
& Xxxxxxxx, of New York, New York, counsel to the Agents, as
a condition to the purchase of Securities pursuant to such
Terms Agreement, the Company shall furnish to such counsel
such papers and information as they may reasonably request
to enable them to furnish to such Agent such opinion or
opinions referred to in Section 6(c) hereof;
(i) That each time the Registration Statement or
the Prospectus shall be amended or supplemented (other than
by a Pricing Supplement), each time a document filed under
the Act or the Exchange Act is incorporated by reference
into the Prospectus (except for a Current Report on Form 8-K
that is filed solely for the purpose of filing exhibits
pursuant to Item 601 of Regulation S-K, unless the Agent
shall otherwise reasonably request), and each time the
Company sells Securities to such Agent as principal pursuant
to a Terms Agreement and such Terms Agreement specifies the
delivery of an opinion under this Section 4(i) as a
condition to the purchase of Securities pursuant to such
Terms Agreement, the Company shall furnish or cause to be
furnished forthwith to such Agent a written letter of Xxxxx
X. Xxxxx, Esq., Senior Vice President and General Counsel to
the Company, or other counsel to the Company satisfactory to
such Agent, dated the date of such amendment, supplement,
incorporation or Time of Delivery relating to such sale, as
the case may be, in form satisfactory to such Agent, to the
effect that such Agent may rely on the opinion of such
counsel referred to in Section 6(d) hereof which was last
furnished to such Agent to the same extent as though it were
dated the date of such letter authorizing reliance (except
that the statements in such last opinion shall be deemed to
relate to the Registration Statement and the Prospectus as
amended and supplemented to such date) or, in lieu of such
opinion, an opinion of the same tenor as the opinion of such
counsel referred to in Section 6(d) hereof but modified to
relate to the Registration Statement and the Prospectus as
amended and supplemented to such date;
(j) That each time the Registration Statement or
the Prospectus shall be amended or supplemented (other than
by a Pricing Supplement), each time a document filed under
the Act or the Exchange Act is incorporated by reference
into the Prospectus (except for a Current Report on Form 8-K
that is filed solely for the purpose of filing exhibits
pursuant to Item 601 of Regulations S-K, unless the Agent
shall otherwise reasonably request), and each time the
Company sells Securities to such Agent as principal pursuant
to a Terms Agreement and such Terms Agreement specifies the
delivery of an opinion under this Section 4(j) as a
condition to the purchase of Securities pursuant to such
Terms Agreement, the Company shall furnish or cause to be
furnished forthwith to such Agent a written opinion of
Paine, Hamblen, Xxxxxx, Xxxxxx & Xxxxxx LLP, of Spokane,
Washington, counsel to the Company, or other counsel to the
Company satisfactory to such Agent, dated the date of such
amendment, supplement, incorporation or Time of Delivery
relating to such sale, as the case may be, in form
satisfactory to such Agent, to the effect that such Agent
may rely on the opinion of such counsel referred to in
Section 6(e) hereof which was last furnished to such Agent
to the same extent as though it were dated the date of such
letter authorizing reliance (except that the statements in
such last opinion shall be deemed to relate to the
Registration Statement and the Prospectus as amended and
supplemented to such date) or, in lieu of such opinion, an
opinion of the same tenor as the opinion of such counsel
referred to in Section 6(e) hereof but modified to relate to
the Registration Statement and the Prospectus as amended and
supplemented to such date;
(k) That each time the Registration Statement or
the Prospectus shall be amended or supplemented (other than
by a Pricing Supplement), each time a document filed under
the Act or the Exchange Act is incorporated by reference
into the Prospectus (except for a Current Report on Form 8-K
that is filed solely for the purpose of filing exhibits
pursuant to Item 601 of Regulation S-K, unless the Agent
shall otherwise reasonably request), and each time the
Company sells Securities to such Agent as principal pursuant
to a Terms Agreement and such Terms Agreement specifies the
delivery of an opinion under this Section 4(k) as a
condition to the purchase of Securities pursuant to such
Terms Agreement, the Company shall furnish or cause to be
furnished forthwith to such Agent a written opinion of
Xxxxxx Xxxx & Priest LLP, of New York, New York, counsel to
the Company, or other counsel to the Company satisfactory to
such Agent, dated the date of such amendment, supplement,
incorporation or Time of Delivery relating to such sale, as
the case may be, in form satisfactory to such Agent, to the
effect that such Agent may rely on the opinion of such
counsel referred to in Section 6(f) hereof which was last
furnished to such Agent to the same extent as though it were
dated the date of such letter authorizing reliance (except
that the statements in such last opinion shall be deemed to
relate to the Registration Statement and the Prospectus as
amended and supplemented to such date) or, in lieu of such
opinion, an opinion of the same tenor as the opinion of such
counsel referred to in Section 6(f) hereof but modified to
relate to the Registration Statement and the Prospectus as
amended and supplemented to such date;
(l) That each time the Registration Statement or
the Prospectus shall be amended or supplemented, other than
by a Pricing Supplement, and each time that a document filed
under the Act or the Exchange Act is incorporated by
reference into the Prospectus (except for a Current Report
on Form 8-K that is filed solely for the purpose of filing
exhibits pursuant to Item 601 of Regulation S-K, unless the
Agent shall otherwise reasonably request), in either case to
set forth financial information included in or derived from
the Company's consolidated financial statements or
accounting records, and each time the Company sells
Securities to such Agent as principal pursuant to a Terms
Agreement and such Terms Agreement specifies the delivery of
a letter under this Section 4(l) as a condition to the
purchase of Securities pursuant to such Terms Agreement, the
Company shall cause the independent certified public
accountants who have certified the financial statements of
the Company and its subsidiaries included or incorporated by
reference in the Registration Statement forthwith to furnish
such Agent a letter, dated the date of such amendment,
supplement, incorporation or Time of Delivery relating to
such sale, as the case may be, in form satisfactory to such
Agent, of the same tenor as the letter referred to in
Section 6(g) hereof but modified to relate to the
Registration Statement and the Prospectus as amended or
supplemented to the date of such letter, with such changes
as may be necessary to reflect changes in the financial
statements and other information derived from the accounting
records of the Company, to the extent such financial
statements and other information are available as of a date
not more than five business days prior to the date of such
letter; provided, however, that, with respect to any
financial information or other matter, such letter may
reconfirm as true and correct at such date as though made at
and as of such date, rather than repeat, statements with
respect to such financial information or other matter made
in the letter referred to in Section 6(f) hereof which was
last furnished to such Agent;
(m) That each time the Registration Statement or
the Prospectus shall be amended or supplemented (other than
by a Pricing Supplement), each time a document filed under
the Act or the Exchange Act is incorporated by reference
into the Prospectus (except for a Current Report on Form 8-K
that is filed solely for the purpose of filing exhibits
pursuant to Item 601 of Regulation S-K, unless the Agent
shall otherwise reasonably request), and each time the
Company sells Securities to such Agent as principal and the
applicable Terms Agreement specifies the delivery of a
certificate under this Section 4(m) as a condition to the
purchase of Securities pursuant to such Terms Agreement, the
Company shall furnish or cause to be furnished forthwith to
such Agent a certificate, dated the date of such amendment,
supplement, incorporation or Time of Delivery relating to
such sale, as the case may be, in such form and executed by
such officers of the Company as shall be satisfactory to
such Agent, to the effect that the statements contained in
the certificate referred to in Section 6(j) hereof which was
last furnished to such Agent are true and correct at such
date as though made at and as of such date (except that such
statements shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented to
such date) or, in lieu of such certificate, certificates of
the same tenor as the certificates referred to in said
Section 6(j) but modified to relate to the Registration
Statement and the Prospectus as amended and supplemented to
such date;
(n) To offer to any person who has agreed to
purchase Securities as the result of an offer to purchase
solicited by such Agent the right to refuse to purchase and
pay for such Securities if, on the related settlement date
fixed pursuant to the Administrative Procedure, any
condition set forth in Section 6(a), 6(h) or 6(i) hereof
shall not have been satisfied (it being understood that the
judgment of such person with respect to the impracticability
or inadvisability of such purchase of Securities shall be
substituted, for purposes of this Section 4(n), for the
respective judgments referred to therein of an Agent with
respect to certain matters referred to in such Sections
6(a), 6(h) and 6(i), and that such Agent shall have no duty
or obligation whatsoever to exercise the judgment permitted
under such Sections 6(a), 6(h) and 6(i) on behalf of any
such person);
(o) That prior to the issue and sale of
Securities, the Company will have received all consents,
approvals, authorizations, orders, registrations and
qualifications of or with any court or any federal or state
regulatory authority or other governmental agency or body
having jurisdiction over the Company or any of its
properties which are legally required for the issuance by
the Company of such Securities, except for consents,
approvals, authorizations, registrations or qualifications
which may be required under the state securities or Blue Sky
laws as to which no covenant is made except as provided in
Section 4(b) hereof.
5. The Company covenants and agrees with each Agent
that the Company will pay or cause to be paid the following: (i)
the fees, disbursements and expenses of the Company's counsel and
accountants in connection with the registration of the Securities
under the Act and all other expenses in connection with the
preparation, printing and filing of the Registration Statement,
any Preliminary Prospectus, the Prospectus and any Pricing
Supplements and all other amendments and supplements thereto and
the mailing and delivering of copies thereof to such Agent; (ii)
the fees, disbursements and expenses of counsel to the Agents in
connection with the establishment of the program contemplated
hereby, any opinions to be rendered by such counsel hereunder and
the transactions contemplated hereunder; (iii) the cost of
printing, preparing by word processor or reproducing this
Agreement, any Terms Agreement, any Indenture, any Blue Sky and
Legal Investment Memoranda and any other documents in connection
with the offering, purchase, sale and delivery of the Securities;
(iv) all expenses in connection with the qualification of the
Securities for offering and sale under state securities laws as
provided in Section 4(b) hereof, including fees and disbursements
of counsel to the Agents in connection with such qualification
and in connection with the Blue Sky and legal investment surveys;
(v) any fees charged by securities rating services for rating the
Securities; (vi) any filing fees incident to any required review
by the National Association of Securities Dealers, Inc. of the
terms of the sale of the Securities; (vii) the cost of preparing
the Securities; (viii) the fees and expenses of any Trustee and
any agent of any Trustee and any transfer or paying agent of the
Company and the fees and disbursements of counsel to any Trustee
or such agent in connection with any Indenture and the
Securities; (ix) any advertising expenses connected with the
solicitation of offers to purchase and the sale of Securities so
long as such advertising expenses have been approved by the
Company; (x) all other reasonable costs, and expenses incident to
the performance of the Agents' obligations hereunder which are
not otherwise specifically provided for in this Section; and (xi)
all other costs and expenses incident to the performance of its
obligations hereunder which are not otherwise specifically
provided for in this Section. Except as provided in Sections 8
and 9 hereof, each Agent shall pay all other expenses it incurs,
including any expenses that may be incurred pursuant to Section
4(c) hereof.
6. The obligation of any Agent, as agent of the
Company, at any time ("Solicitation Time") to solicit offers to
purchase the Securities and the obligation of any Agent to
purchase Securities as principal, pursuant to any Terms Agreement
or otherwise, shall in each case be subject, in such Agent's
discretion, to the condition that all representations and
warranties and other statements of the Company herein (and, in
the case of an obligation of an Agent under a Terms Agreement, in
or incorporated in such Terms Agreement by reference) are true
and correct at and as of the Commencement Date and any applicable
date referred to in Section 4(m) hereof that is prior to such
Solicitation Time or Time of Delivery, as the case may be, and at
and as of such Solicitation Time or Time of Delivery, as the case
may be, the condition that prior to such Solicitation Time or
Time of Delivery, as the case may be, the Company shall have
performed all of its obligations hereunder theretofore to be
performed, and the following additional conditions:
(a) (i) With respect to any Securities sold at
or prior to such Solicitation Time or Time of Delivery, as
the case may be, the Prospectus as amended or supplemented
(including the Pricing Supplement) with respect to such
Securities shall have been filed or transmitted for filing
with the Commission pursuant to Rule 424(b) under the Act
within the applicable time period prescribed for such filing
by the rules and regulations under the Act and in accordance
with Section 4(a) hereof; (ii) no stop order suspending the
effectiveness of the Registration Statement shall have been
issued and no proceeding for that purpose shall be pending
before, or to the knowledge of the Company or the Agent
contemplated by, the Commission; and (iii) all requests of
the Commission for additional information (to be included in
the Registration Statement or the Prospectus or otherwise)
shall have been complied with to the reasonable satisfaction
of such Agent;
(b) There shall have been issued and there shall
be in full force and effect, appropriate orders of the
Washington Utilities and Transportation Commission, the
California Public Utilities Commission, the Idaho Public
Utilities Commission and the Public Utility Commission of
Oregon permitting the issuance and sale of the Securities on
the terms herein set forth or contemplated, and containing
no provision reasonably unacceptable to the Agents (it being
understood that no such order in effect on the date of this
Agreement contains any such unacceptable provision);
(c) Xxxxxxxx & Xxxxxxxx, counsel to the Agents,
shall have furnished to such Agent (i) such opinion or
opinions, dated the Commencement Date, with respect to the
incorporation of the Company, the validity of the Indenture,
the Securities, the Registration Statement, the Prospectus
as amended or supplemented and other related matters as such
Agent may reasonably request, and (ii) if and to the extent
requested by such Agent, with respect to each applicable
date referred to in Section 4(h) hereof that is on or prior
to such Solicitation Time or Time of Delivery, as the case
may be, an opinion or opinions, dated such applicable date,
to the effect that such Agent may rely on the opinion or
opinions which were last furnished to such Agent pursuant to
this Section 6(c) to the same extent as though it or they
were dated the date of such letter authorizing reliance
(except that the statements in such last opinion or opinions
shall be deemed to relate to the Registration Statement and
the Prospectus as amended and supplemented to such date) or,
in any case, in lieu of such an opinion or opinions, an
opinion or opinions of the same tenor as the opinions or
opinions referred to in clause (i) but modified to relate to
the Registration Statement and the Prospectus as amended and
supplemented to such date; and in each case such counsel
shall have received such papers and information as they may
reasonably request to enable them to pass upon such matters.
In rendering such opinion or opinions, Xxxxxxxx & Xxxxxxxx
may rely, as to the incorporation of the Company and as to
all other matters governed by Washington, California, Idaho,
Montana or Oregon law, upon the opinion of Paine, Hamblen,
Xxxxxx, Xxxxxx & Xxxxxx LLP referred to below;
(d) Xxxxx X. Xxxxx, Esq. Senior Vice President
and General Counsel to the Company, or other counsel to the
Company satisfactory to such Agent, shall have furnished to
such Agent his written letters, dated the Commencement Date
and each applicable date referred to in Section 4(i) hereof
that is on or prior to such Solicitation Time or Time of
Delivery, as the case may be, in form and substance
satisfactory to such Agent, to the effect set forth in Annex
III.
(e) Paine, Hamblen, Xxxxxx, Xxxxxx & Xxxxxx LLP,
counsel to the Company, or other counsel to the Company
satisfactory to such Agent, shall have furnished to such
Agent their written opinions, dated the Commencement Date
and each applicable date referred to in Section 4(j) hereof
that is on or prior to such Solicitation Time or Time of
Delivery, as the case may be, in form and substance
satisfactory to such Agent, to the effect set forth in Annex
IV.
In rendering such opinion or opinions, Paine,
Hamblen, Xxxxxx, Xxxxxx & Xxxxxx LLP may rely as to all
matters governed by New York law and Federal laws relating
to the issuance and sale of securities upon the opinion of
Xxxxxx Xxxx & Priest LLP referred to below.
(f) Xxxxxx Xxxx & Priest LLP, counsel to the
Company, or other counsel to the Company satisfactory to
such Agent, shall have furnished to such Agent their written
opinions, dated the Commencement Date and each applicable
date referred to in Section 4(k) hereof that is on or prior
to such Solicitation Time or Time of Delivery, as the case
may be, in form and substance satisfactory to such Agent, to
the effect set forth in Annex V.
In rendering such opinion or opinions Xxxxxx Xxxx
& Priest LLP may rely, as to the incorporation of the
Company and as to all other matters governed by Washington,
California, Idaho, Montana or Oregon law, upon the opinion
of Paine, Hamblen, Xxxxxx, Xxxxxx & Xxxxxx LLP referred to
above;
(g) Not later than 11:00 a.m., New York City
time, on the Commencement Date and on each applicable date
referred to in Section 4(l) hereof that is on or prior to
such Solicitation Time or Time of Delivery, as the case may
be, the independent certified public accountants who have
certified the financial statements of the Company and its
subsidiaries included or incorporated by reference in the
Registration Statement shall have furnished to such Agent a
letter, dated the Commencement Date or such applicable date,
as the case may be, in form and substance satisfactory to
such Agent, to the effect set forth in Annex VI hereto;
(h) Except as set forth in or contemplated by the
Prospectus, as amended or supplemented, (A) since the
respective dates as of which information is given in the
Prospectus, as amended or supplemented, there has not been
any material adverse change in the condition of the Company
and its subsidiaries as a whole, financial or otherwise, (B)
since such dates there has not been any transaction entered
into by the Company or any subsidiary thereof which is
material to the Company and its subsidiaries as a whole
other than transactions in the ordinary course of business,
and (C) neither the Company nor any of its subsidiaries has
any contingent obligation which is material to the Company
and its subsidiaries as a whole, and the effect of which, in
any such case, is in the reasonable judgment of such Agent,
so material and adverse as to make it impracticable or
inadvisable to proceed with the solicitation by such Agent
of offers to purchase Securities from the Company or the
purchase by such Agent of Securities from the Company as
principal, as the case may be, on the terms and in the
manner contemplated in the Prospectus as amended or
supplemented;
(i) There shall not have occurred any of the
following: (i) a suspension or material limitation in
trading in securities generally on the New York Stock
Exchange; (ii) trading of any securities of the Company
shall have been suspended or limited on any securities
exchange or in any over-the-counter market; (iii) a general
moratorium on commercial banking activities in New York
declared by either Federal or New York State authorities;
(iv) the outbreak of major hostilities or the material
escalation of existing hostilities so as to result in major
hostilities, or the declaration by the United States of a
national emergency or war, or other national or
international calamity or crisis; or (v) any downgrading in
the rating accorded the Company's debt securities by any
"nationally recognized statistical rating organization" (as
that term is defined by the Commission for purposes of Rule
436(g)(2) under the Act) or the placing by any such
organization of the Company's outstanding debt securities or
preferred stock on what is commonly termed a "watch list"
for possible downgrading; provided, however, that in the
case of any event described in clause (iv) or clause (v)
above, the effect of such event, in the reasonable judgment
of such Agent, shall make it impracticable or inadvisable to
proceed with the solicitation of offers to purchase
Securities, the purchase of Securities from the Company as
principal, pursuant to the applicable Terms Agreement or
otherwise, or the enforcement of contracts for the sale of
Securities, as the case may be, on the terms and in the
manner contemplated in the Prospectus as amended or
supplemented; and
(j) The Company shall have furnished or caused to
be furnished to such Agent certificates of officers of the
Company dated the Commencement Date and each applicable date
referred to in Section 4(m) hereof that is on or prior to
such Solicitation Time or Time of Delivery, as the case may
be, in such form and executed by such officers of the
Company as shall be satisfactory to such Agent, as to the
accuracy of the representations and warranties of the
Company herein at and as of the Commencement Date or such
applicable date, as the case may be, as to the performance
by the Company in all material respects of all of its
obligations hereunder to be performed at or prior to the
Commencement Date or such applicable date, as the case may
be, as to the matters set forth in subsections (a) and (h)
of this Section 6, and as to such other matters as such
Agent may reasonably request.
7. The obligation of the Company to sell and deliver
Securities, pursuant to any Terms Agreement or otherwise, shall
in each case be subject to the following conditions:
(a) On the Settlement Date for the Securities or
Time of Delivery, as the case may be, no stop order
suspending the effectiveness of the Registration Statement
shall have been issued and no proceedings for that purpose
shall be pending before, or to the knowledge of the Company
or the Agent contemplated by, the Commission.
(b) At or before the Settlement Date or Time of
Delivery, as the case may be, there shall have been issued,
and there shall be in full force and effect, appropriate
orders of the Washington Utilities and Transportation
Commission, the California Public Utilities Commission, the
Idaho Public Utilities Commission and the Public Utility
Commission of Oregon permitting the issuance and sale of the
Securities on the terms herein set forth or contemplated,
and containing no provision reasonably unacceptable to the
Company (it being understood that no such order in effect on
the date of this Agreement contains any such unacceptable
provision).
If any of the conditions specified above in this
Section shall not have been fulfilled, the Terms Agreement may be
terminated by the Company without liability on the part of any
party to any other party, except for the obligation of the
Company to pay certain expenses to the extent provided for in
Sections 6(i) and 6(j) hereof and except for any liability under
Section 8 hereof.
8. (a) The Company will indemnify and hold harmless
each Agent against any losses, claims, damages or liabilities,
joint or several, to which such Agent may become subject, under
the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the
Registration Statement, the Prospectus, the Prospectus as amended
or supplemented or any other prospectus relating to the
Securities, or any amendment or supplement thereto, or arise out
of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; and will
reimburse such Agent for any legal or other expenses reasonably
incurred by it in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however,
that the Company shall not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out
of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary
Prospectus, the Registration Statement, the Prospectus, the
Prospectus as amended or supplemented or any other prospectus
relating to the Securities, or any such amendment or supplement,
in reliance upon and in conformity with written information
furnished to the Company by such Agent specifically for use in
the preparation thereof; and provided, further, that, the
indemnity agreement contained in this subsection (a) shall not
inure to the benefit of any Agent on account of any such losses,
claims, damages or liabilities (or actions in respect thereof)
arising from the sale of the Securities by or through such Agent
to any person if a copy of the Prospectus as it then may be
amended or supplemented (exclusive of the Incorporated Documents)
shall not have been given or sent to such person by such Agent
with or prior to the written confirmation of the sale involved to
the extent that (i) the Prospectus as so amended or supplemented
would have cured the defect in such document giving rise to such
losses, claims, damages or liabilities, (ii) sufficient
quantities of the Prospectus as so amended or supplemented were
timely made available to such Agent and (iii) such Agent shall
not have reasonably objected to such amendment or supplement
pursuant to Section 4(a) hereof.
(b) Each Agent will indemnify and hold harmless the
Company against any losses, claims, damages or liabilities to
which the Company may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration
Statement, the Prospectus, the Prospectus as amended or
supplemented or any other prospectus relating to the Securities,
or any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made
in any Preliminary Prospectus, the Registration Statement, the
Prospectus, the Prospectus as amended or supplemented or any
other prospectus relating to the Securities, or any such
amendment or supplement, in reliance upon and in conformity with
written information furnished to the Company by such Agent
specifically for use in the preparation thereof; and will
reimburse the Company for any legal or other expenses reasonably
incurred by the Company in connection with investigating or
defending any such loss, claim, damage, liability or action.
(c) Promptly after receipt by an indemnified party
under subsection (a) or (b) above of notice of the commencement
of any action, such indemnified party shall, if a claim in
respect thereof is to be made against the indemnifying party
under such subsection, notify the indemnifying party in writing
of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which
it may have to any indemnified party otherwise than under such
subsection. In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of
the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall
wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party (who shall not, except
with the consent of the indemnified party, be counsel to the
indemnifying party), and, after notice from the indemnifying
party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party shall not be liable to
such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case
subsequently incurred by such indemnified party, in connection
with the defense thereof other than reasonable costs of
investigation. In any such proceeding, any indemnified party
shall have the right to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of such
indemnified party unless (i) the indemnifying party and the
indemnified party shall have mutually agreed to the retention of
such counsel or (ii) the named parties to any such proceeding
(including any impleaded parties) include both the indemnifying
party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual
or potential differing interests between them.
(d) If the indemnification provided for in this
Section 8 is unavailable to or insufficient to hold harmless an
indemnified party under subsection (a) or (b) above in respect of
any losses, claims, damages or liabilities (or actions in respect
thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is
appropriate to reflect the relative benefits received by the
Company on the one hand and each Agent on the other from the
offering of the Securities to which such loss, claim, damage or
liability (or action in respect thereof) relates and the relative
fault of the Company on the one hand and the Agent on the other
in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. The relative benefits
received by the Company on the one hand and each Agent on the
other shall be deemed to be in the same proportion as the total
net proceeds from the sale of Securities (before deducting
expenses) received by the Company bear to the total commissions
or discounts received by such Agent in respect thereof. The
relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a
material fact required to be stated therein or necessary in order
to make the statements therein not misleading relates to
information supplied by the Company on the one hand or by any
Agent on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such
statement or omission. The Company and each Agent agree that it
would not be just and equitable if contribution pursuant to this
subsection (d) were determined by per capita allocation (even if
all Agents were treated as one entity for such purpose) or by any
other method of allocation which does not take account of the
equitable considerations referred to above in this subsection
(d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages or liabilities (or actions
in respect thereof) referred to above in this subsection (d)
shall, except as limited by subsection (c) above, be deemed to
include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending
any such action or claim. Notwithstanding the provisions of this
subsection (d), an Agent shall not be required to contribute any
amount in excess of the amount by which the total public offering
price at which the Securities purchased by or through it were
sold exceeds the amount of any damages which such Agent has
otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent
misrepresentation. The obligations of each of the Agents under
this subsection (d) to contribute are several in proportion to
the respective purchases made by it or through it to which such
loss, claim, damage or liability (or action in respect thereof)
relates and are not joint.
(e) The obligations of the Company under this Section
8 shall be in addition to any liability which the Company may
otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls any Agent within
the meaning of the Act; and the obligations of each Agent under
this Section 8 shall be in addition to any liability which such
Agent may otherwise have and shall extend, upon the same terms
and conditions, to each director of the Company, to each officer
of the Company who has signed the Registration Statement and to
each person, if any, who controls the Company within the meaning
of the Act.
9. (a) Each Agent, in soliciting offers to purchase
Securities from the Company and in performing the other
obligations of such Agent hereunder (other than in respect of any
purchase by an Agent as principal pursuant to a Terms Agreement
or otherwise), is acting solely as agent for the Company and not
as principal. Each Agent will make reasonable efforts to assist
the Company in obtaining performance by each purchaser whose
offer to purchase Securities from the Company was solicited by
such Agent and has been accepted by the Company, but such Agent
shall not have any liability to the Company in the event such
purchase is not consummated for any reason.
(b) If the Company shall default on its obligation to
deliver Securities to a purchaser whose offer it has accepted,
the Company shall (i) hold each Agent harmless against any loss,
claim or damage arising from or as a result of such default by
the Company and (ii) notwithstanding such default, pay to the
Agent that solicited such offer any commission to which it would
be entitled in connection with such sale.
10. The respective indemnities, agreements, repre-
sentations, warranties and other statements by any Agent and the
Company set forth in or made pursuant to this Agreement shall
remain in full force and effect regardless of any investigation
(or any statement as to the results thereof) made by or on behalf
of any Agent or any controlling person of any Agent or the
Company, or any officer or director or any controlling person of
the Company, and shall survive each delivery of and payment for
any of the Securities.
11. The provisions of this Agreement relating to the
solicitation of offers to purchase securities from the Company
may be suspended or terminated at any time by the Company as to
any Agent or by any Agent as to such Agent upon the giving of
written notice of such suspension or termination to such Agent or
the Company, as the case may be. In the event of such suspension
or termination with respect to any Agent, (x) this Agreement
shall remain in full force and effect with respect to any Agent
as to which such suspension or termination has not occurred, (y)
this Agreement shall remain in full force and effect with respect
to the rights and obligations of any party which have previously
accrued or which relate to Securities which are already issued,
agreed to be issued or the subject of a pending offer at the time
of such suspension or termination and (z) in any event, this
Agreement shall remain in full force and effect insofar as the
fourth paragraph of Section 2(a), Section 4(d), Section 4(e),
Section 5, Section 8, Section 9 and Section 10 hereof are
concerned.
12. Except as otherwise specifically provided herein
or in the Administrative Procedure, all statements, requests,
notices and advices hereunder shall be in writing, or by
telephone if promptly confirmed in writing, and if to [Insert
name of Agent] shall be sufficient in all respects when delivered
or sent by facsimile transmission or registered mail to [Insert
address of Agent], Facsimile Transmission No. [Insert number],
Attention: [Insert name], Telephone No. [Insert number], with a
copy to [Insert address], Facsimile Transmission No. [Insert
number], Attention: [Insert name], Telephone No. [Insert number],
and if to [Insert name of Agent] shall be sufficient in all
respects when delivered or sent by facsimile transmission or
registered mail to [Insert address], Facsimile Transmission No.
[Insert number], Attention: [Insert name], Telephone No. [Insert
number], and if to [Insert name of Agent] shall be sufficient in
all respects when delivered or sent by facsimile transmission or
registered mail to [Insert address], Facsimile Transmission No.
[Insert number], Attention: [Insert name], Telephone No. [Insert
number], and if to the Company shall be sufficient in all
respects when delivered or sent by facsimile transmission or
registered mail to 0000 Xxxx Xxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxx
00000, Attention: Treasurer, Facsimile Transmission No. (509)
000-0000, telephone No. (000) 000-0000.
13. This Agreement and any Terms Agreement shall be
binding upon, and inure solely to the benefit of, each Agent and
the Company, and to the extent provided in Section 8, Section 9
and Section 10 hereof, the officers and directors of the Company
and any person who controls any Agent or the Company, and their
respective personal representatives, successors and assigns, and
no other person shall acquire or have any right under or by
virtue of this Agreement or any Terms Agreement. No purchaser of
any of the Securities through or from any Agent hereunder shall
be deemed a successor or assign by reason merely of such
purchase.
14. Time shall be of the essence in this Agreement and
any Terms Agreement. As used herein, the term "business day"
shall mean any day when the office of the Commission in
Washington, D.C. is open for business.
15. THIS AGREEMENT AND ANY TERMS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAWS
PROVISIONS THEREOF.
16. This Agreement and any Terms Agreement may be
executed by any one or more of the parties hereto and thereto in
any number of counterparts, each of which shall be an original,
but all of such respective counterparts shall together constitute
one and the same instrument.
If the foregoing is in accordance with your under-
standing, please sign and return to us four counterparts hereof,
whereupon this letter and the acceptance by each of you thereof
shall constitute a binding agreement between the Company and each
of you in accordance with its terms.
Very truly yours,
AVISTA CORPORATION
By:
--------------------------
Title:
Accepted in New York, New York
as of the date hereof:
[INSERT NAME OF AGENT]
By:
-------------------------------
Title:
[INSERT NAME OF AGENT]
By:
-------------------------------
Title:
[INSERT NAME OF AGENT]
By:
-------------------------------
Title:
ANNEX I
Avista Corporation
Medium-Term Notes, Series D
Terms Agreement
---------------
, 19
------------------ --
[Insert name and address of Agent]
[Insert name and address of Agent]
[Insert name and address of Agent]
Ladies and Gentlemen:
Avista Corporation (the "Company") proposes, subject to
the terms and conditions stated herein and in the Distribution
Agreement, dated , 1999 (the "Distribution Agreement"),
--------
between the Company on the one hand and [Insert name Agent],
[Insert name Agent] and [Insert name Agent] (the "Agents") on the
other, to issue and sell to [Insert name Agent] [Insert name
Agent] [Insert name Agent] the securities specified in the
Schedule hereto (the "Purchased Securities"). Each of the
provisions of the Distribution Agreement not specifically related
to the solicitation by the Agents, as agents of the Company, of
offers to purchase Securities is incorporated herein by reference
in its entirety, and shall be deemed to be part of this Terms
Agreement to the same extent as if such provisions had been set
forth in full herein. Nothing contained herein or in the
Distribution Agreement shall make any party hereto an agent of
the Company or make such party subject to the provisions therein
relating to the solicitation of offers to purchase securities
from the Company, solely by virtue of its execution of this Terms
Agreement. Each of the representations and warranties set forth
therein shall be deemed to have been made at and as of the date
of this Terms Agreement, except that each representation and
warranty in Section 1 of the Distribution Agreement which makes
reference to the Prospectus shall be deemed to be a
representation and warranty as of the date of the Distribution
Agreement in relation to the Prospectus (as therein defined), and
also a representation and warranty as of the date of this Terms
Agreement in relation to the Prospectus as amended and
supplemented to relate to the Purchased Securities.
An amendment to the Registration Statement, or a
supplement to the Prospectus, as the case may be, relating to the
Purchased Securities, in the form heretofore delivered to you is
now proposed to be filed with the Commission.
Subject to the terms and conditions set forth herein
and in the Distribution Agreement incorporated herein by
reference, the Company agrees to issue and sell to [Insert name
Agent] [Insert name Agent] [Insert name Agent] and [Insert name
Agent] [Insert name Agent] [Insert name Agent] agrees to purchase
from the Company the Purchased Securities, at the time and place,
in the principal amount and at the purchase price set forth in
the Schedule hereto.
If the foregoing is in accordance with your
understanding, please sign and return to us three counterparts
hereof, and upon acceptance hereof by you this letter and such
acceptance hereof, including those provisions of the Distribution
Agreement incorporated herein by reference, shall constitute a
binding agreement between you and the Company.
AVISTA CORPORATION
By:
----------------------------
Accepted in New York, New York,
as of the date hereof:
[INSERT NAME AGENT]
By:
--------------------------------
Title:
[INSERT NAME AGENT]
By:
--------------------------------
Title:
[INSERT NAME AGENT]
By:
--------------------------------
Title:
Schedule to Annex I
Title of Purchased Securities:
-----------------------------
Medium-Term Notes, Series D
Aggregate Principal Amount:
--------------------------
$
[Price to Public:]
Purchase Price by: [Insert Name Agent] [Insert Name Agent]
[Insert Name Agent]
% of the principal amount of the Purchased Securities
[, plus accrued interest from to ] [and accrued
amortization, if any, from to ]
Method of and Specified Funds for Payment of Purchase Price:
-----------------------------------------------------------
[By certified or official bank check or checks, payable
to the order to the Company, in [New York Clearing House]
[immediately available] funds]
[By wire transfer to a bank account specified by the
Company in [next day] [immediately available] funds]
Time of Delivery:
----------------
Closing Location:
----------------
Maturity:
--------
Interest Rate:
-------------
%
Interest Payment Dates:
----------------------
[months and dates]
Documents to Delivered:
----------------------
The following documents referred to in the Distribution
Agreement shall be delivered as a condition to the Closing:
[(1) The opinion or opinions of counsel to the Agents
referred to in Section 4(h).]
[(2) The opinion of counsel to the Company referred to
in Section 4(i).]
[(3) The opinion of counsel to the Company referred to
in Section 4(j).]
[(4) The opinion of counsel to the Company referred to
in Section 4(k).]
[(5) The accountants' letter referred to in Section
4(l).]
[(6) The officers' certificate referred to in Section
4(m).]
Other provisions (including Syndicate Provisions, if applicable):
----------------------------------------------------------------
ANNEX II
Avista Corporation
Administrative Procedure
------------------------
This Administrative Procedure relates to the Securities
defined in the Distribution Agreement, dated , 1999 (the
--------
"Distribution Agreement"), between Avista Corporation (the
"Company") and [Insert Name Agent], [Insert Name Agent] and
[Insert Name Agent] (the "Agents"), to which this Administrative
Procedure is attached as Annex II. Defined terms used herein and
not defined herein shall have the meanings given such terms in
the Distribution Agreement, the Prospectus (as defined therein),
as amended or supplemented, or the Indenture referred to below.
The procedures to be followed with respect to the
settlement of sales of Securities directly by the Company to
purchasers solicited by an Agent, as agent, are set forth below.
The terms and settlement details related to a purchase of
Securities by an Agent, as principal, from the Company will be
set forth in a Terms Agreement pursuant to the Distribution
Agreement, unless the Company and such Agent otherwise agree as
provided in Section 2(b) of the Distribution Agreement, in which
case the procedures to be followed in respect of the settlement
of such sale will be as set forth below. An Agent, in relation
to a purchase of a Security by a purchaser solicited by such
Agent, is referred to herein as the "Selling Agent" and, in
relation to a purchase of a Security by such Agent as principal
other than pursuant to a Terms Agreement, as the "Purchasing
Agent."
The Securities will be issued under the Company's
Indenture, dated as of April 1, 1998, to The Chase Manhattan
Bank, as trustee (the "Trustee") as it will be supplemented by an
Officer's Certificate dated , 1999 (such Indenture, as so
--------
supplemented and as it may be amended and further supplemented,
being hereinafter referred to as the "Indenture"). The Chase
Manhattan Bank ("Chase") will act as paying agent for the payment
of principal and of premium, if any, and interest on the
Securities, and will perform in various capacities unless
otherwise specified by the Company or agreed by the parties, the
other duties specified herein.
The Company will advise each Agent in writing of those
persons with whom such Agent is to communicate regarding offers
to purchase Securities and the related settlement details.
Each tranche of the Securities will be represented
entirely by either a Global Security (as defined below) delivered
to Chase, as agent for The Depository Trust Company ("DTC"), and
recorded in the book-entry system maintained by DTC (a "Book-
Entry Security") or by a certificate(s) issued as a registered
Security or Securities delivered to the holder(s) thereof or a
person(s) designated by such holder(s) (a "Certificated
Security"). An owner of a Book-Entry Security will not be
entitled to receive a certificate representing such a Security
except under the limited circumstances described in the
Prospectus. An owner of a Certificated Security will not be
entitled to become in lieu thereof the owner of a Book-Entry
Security.
Administrative procedures and specific terms of the
offering are explained below. Certificated Securities will be
issued in accordance with the administrative procedures set forth
in Part I hereof and Book-Entry Securities will be issued in
accordance with the administrative procedures set forth in Part
II hereof. Administrative responsibilities and record-keeping
functions not performed by Chase or DTC will be performed by the
Company's Treasurer or its Assistant Treasurer.
PART I: ADMINISTRATIVE PROCEDURE FOR CERTIFICATED SECURITIES
Posting Rates by Company:
------------------------
The Company and the Agents will discuss from time to
time the rates of interest per annum to be borne by and the
maturity of Certificated Securities that may be sold as a result
of the solicitation of offers by an Agent. The Company may
establish interest rates and maturities for an offering period
("posting") which shall, at all times, be within the limitations
set forth by the Company's Board of Directors and in the orders
of the Washington Utilities and Transportation Commission
("WUTC"), the California Public Utilities Commission ("CPUC"),
the Idaho Public Utilities Commission ("IPUC") and the Public
Utility Commission of Oregon ("OPUC") applicable to the issuance
and sale of the Securities. If the Company decides to change
already posted rates, it will promptly advise the Agents to
suspend solicitation of offers until the new posted rates have
been established with the Agents.
Acceptance of Offers by Company:
-------------------------------
Each Agent will promptly advise the Company by
telephone or other appropriate means of all reasonable offers to
purchase Certificated Securities, other than those rejected by
such Agent. Each Agent may, in its discretion reasonably
exercised, reject any offer received by it in whole or in part.
Each Agent also may make offers to the Company to purchase
Certificated Securities as a Purchasing Agent. The Company will
have the sole right to accept offers to purchase Certificated
Securities and may reject any such offer in whole or in part.
The Company will promptly notify the Selling Agent or
Purchasing Agent, as the case may be, of its acceptance or
rejection of an offer to purchase Certificated Securities. If
the Company accepts as offer to purchase Certificated Securities,
it will confirm such acceptance in writing to the Selling Agent
or Purchasing Agent, as the case may be, and Chase.
Communication of Sale Information to Company by Selling Agent:
-------------------------------------------------------------
After the acceptance of an offer by the Company, the
Selling Agent or Purchasing Agent, as the case may be, will
communicate the following details of the terms of such offer (the
"Sale Information") to the Company by telephone (confirmed in
writing) or by facsimile transmission or other acceptable written
means:
(1) Whether the Security is a Certificated Security or
a Book-Entry Security;
(2) Principal amount of Certificated Securities to be
purchased;
(3) Interest rate, interest payment dates, including
without limitation all necessary information with
respect to Floating Rate Notes, and initial
interest payment date;
(4) Stated Maturity Date;
(5) Issue Price;
(6) Selling Agent's commission or Purchasing Agent's
discount or commission, as the case may be;
(7) Net proceeds to the Company;
(8) Settlement Date (Original Issue Date);
(9) If a redeemable Certificated Security, such of the
following as are applicable:
(a) Initial Redemption Date;
(b) Initial Redemption Price (% of par);
(c) Amount (% of par) that the Redemption Price
shall decline (but not below par) ("Reduction
Percentage") and the dates on which such
Redemption Price shall decline after the
Initial Redemption Date; and
(d) Redemption Limitation Date.
(10) Name, address and taxpayer identification number
of the registered owner;
(11) Denomination of certificates to be delivered at
Settlement; and
(12) All other information necessary to complete the
form of Security prior to its authentication and
delivery.
Preparation of Pricing Supplement by Company:
--------------------------------------------
If the Company accepts an offer to purchase a
Certificated Security, it will prepare a Pricing Supplement. The
Company will arrange to have ten Pricing Supplements filed with
the Commission not later than the close of business of the
Commission on the third Business Day following the date on which
such Pricing Supplement is first used and will supply at least
ten copies of such Pricing Supplement to the Selling Agent or
Purchasing Agent, as the case may be. In addition, the Company
will file as required copies of the Pricing Supplement with the
applicable state regulatory authorities concurrently with the
filing of the Pricing Supplement with the Commission.
Delivery of Confirmation and Prospectus to Purchaser by Selling
---------------------------------------------------------------
Agent:
-----
The Selling Agent will deliver to the purchaser of a
Security a written confirmation of the sale and delivery and
payment instructions. In addition, the Selling Agent will
deliver to such purchaser or its agent the prospectus as amended
or supplemented (including the Pricing Supplement) relating to
such Certificated Security prior to or together with the earlier
of the delivery to such purchaser or its agent of (a) the
confirmation of sale or (b) the Certificated Security.
Date of Settlement:
------------------
The receipt by the Company of immediately available
funds in payment for a Certificated Security shall constitute
"Settlement" with respect to such Certificated Security. All
orders accepted by the Company will be settled on a date (the
"Settlement Date") which is the third Business Day after the date
of acceptance of such offer, unless the Company and the purchaser
agree to Settlement (a) on any other Business Day after the
acceptance of such offer or (b) with respect to an offer accepted
by the Company prior to 10:00 a.m., New York City time, on the
date of such acceptance, provided that such day shall be a
Business Day.
Instruction from Company to Trustee for Preparation of
------------------------------------------------------
Certificated Securities:
-----------------------
After receiving the Sale Information from the Selling
Agent or Purchasing Agent, as the case may be, the Company will
communicate such Sale Information to the Trustee by Company Order
by facsimile transmission or other acceptable written means.
The Company will instruct the Trustee by Company Order
by facsimile transmission or other acceptable written means to
authenticate and deliver the Certificated Securities no later
than 2:15 p.m., New York City time, on the Settlement Date. Such
instruction will be given by the Company prior to 3:00 p.m., New
York City time, on the Business Day prior to the Settlement Date
unless the Settlement Date is the date of acceptance by the
Company of the offer to purchase Certificated Securities in which
case such instruction will be given by the Company to the Trustee
by 11:00 a.m., New York City time.
Preparation and Delivery of Securities by Trustee and Receipt of
----------------------------------------------------------------
Payment Therefor:
----------------
The Trustee will prepare each Certificated Security and
appropriate receipts that will serve as the documentary control
of the transaction.
In the case of a sale of Certificated Securities to a
purchaser solicited by an Agent, the Trustee will, by 2:15 p.m.,
New York City time, on the Settlement Date, deliver the
Certificated Securities to the Selling Agent, at the address
listed below, for the benefit of the purchaser of such
Certificated Securities against delivery by the Selling Agent of
a receipt therefor. On the Settlement Date the Selling Agent
will deliver payment for such Certificated Securities in
immediately available funds to the Company's account at a bank
designated by the Company and notified by the Company to the
Selling Agent at least three days prior to the Settlement Date in
an amount equal to the issue price of the Certificated Securities
less the Selling Agent's commission. Any monies received by an
Agent from a purchaser of Securities in payment of the purchase
price of such Securities from the time the Trustee delivers the
Securities to the Selling Agent to the time the Agent delivers
payment for such Securities to the Company's account, as provided
above, shall be held by such Agent, as agent of the Company.
In the case of a sale of Certificated Securities to a
Purchasing Agent, the Trustee will, by 2:15 p.m., New York City
time, on the Settlement Date, deliver the Certificated Securities
to the Purchasing Agent against delivery by the Purchasing Agent
of a receipt therefor. On the Settlement Date, the Purchasing
Agent will deliver payment for such Certificated Securities in
immediately available funds, or otherwise pursuant to the Terms
Agreement, to the account of the Company as designated in the
preceding paragraph in an amount equal to the issue price of the
Certificated Securities less the Purchasing Agent's discount.
Failure of Purchaser to Pay Selling Agent:
-----------------------------------------
If a purchaser (other than a Purchasing Agent) fails to
make payment to the Selling Agent for a Certificated Security,
the Selling Agent will promptly notify the Trustee and the
Company thereof by telephone (promptly confirmed in writing) or
by facsimile transmission or by other acceptable written means.
The Selling Agent will immediately return the Certificated
Security to the Trustee. Immediately upon receipt of such
Certificated Security by the Trustee, the Company will return to
the Selling Agent the amount previously paid to the Company in
respect of such Certificated Security. The Company will, in
addition, reimburse the Selling Agent on an equitable basis for
its loss of the use of funds during the period when they were
credited to the account of the Company; provided, however, that
the Selling Agent shall be entitled to no reimbursement hereunder
if funds are returned on the day on which such funds had been
previously credited to the account of the Company such that the
Selling Agent is afforded a reasonable opportunity to invest such
funds at an overnight rate on such day; and provided further that
if the Selling Agent is denied the use of such funds due to its
failure to return the relevant Certificated Security to the
Trustee in a timely manner it shall only be entitled to
reimbursement hereunder in an amount equal to the amount that
would have been earned on such funds had such funds been on
deposit at an overnight rate during the period between their
credit to the account of the Company and their reimbursement to
the Agent.
The Trustee will cancel the Certificated Security in
respect of which the failure occurred, make appropriate entries
in its records and, unless otherwise instructed by the Company,
dispose of the Certificated Security.
Delivery of the Certificated Securities:
---------------------------------------
Unless otherwise notified by any Agent to the Trustee,
the Trustee shall deliver the Certificated Securities in
accordance with the procedures set forth above to any Agent (as
the case may be) at the following addresses:
PART II: ADMINISTRATIVE PROCEDURES FOR BOOK-ENTRY SECURITIES
In connection with the qualification of the Book-Entry
Securities for eligibility in the book-entry system maintained by
DTC, Chase will perform the custodial, document control and
administrative functions described below, in accordance with its
respective obligations under a Letter of Representations from the
Company and Chase to DTC, dated April 24, 1998, a Bring-Down
Letter of Representations from the Company and Chase to DTC,
dated the date hereof, and a Medium-Term Note Certificate
Agreement between Chase and DTC, dated as of December 2, 1988
("Certificate Agreement"), and its obligations as a participant
in DTC, including DTC's Same-Day Funds Settlement System
("SDFS").
Posting Rates by Company:
------------------------
The Company and the Agents will discuss from time to
time the rates of interest per annum to be borne by and the
maturity of Book-Entry Securities that may be sold as a result of
the solicitation of offers by an Agent. The Company may
establish interest rates and maturities for an offering period
("posting") which shall, at all times, be within the limitations
set forth by the Company's Board of Directors and in the orders
of the WUTC, CPUC, IPUC and OPUC applicable to the issuance and
sale of the Securities. If the Company decides to change already
posted rates, it will promptly advise the Agents to suspend
solicitation of offers until the new posted rates have been
established with the Agents.
Acceptance of Offers by Company:
-------------------------------
Each Agent will promptly advise the Company by
telephone or other appropriate means of all reasonable offers to
purchase Book-Entry Securities, other than those rejected by such
Agent. Each Agent may, in its discretion reasonably exercised,
reject any offer received by it in whole or in part. Each Agent
also may make offers to the Company to purchase Book-Entry
Securities as a Purchasing Agent. The Company will have the sole
right to accept offers to purchase Book-Entry Securities and may
reject any such offer in whole or in part.
The Company will promptly notify the Selling Agent or
Purchasing Agent, as the case may be, of its acceptance or
rejection of an offer to purchase Book-Entry Securities. If the
Company accepts an offer to purchase Book-Entry Securities, it
will confirm such acceptance in writing to the Selling Agent or
Purchasing Agent, as the case may be, and Chase.
Communication of Book-Entry Information to the Company by Selling
-----------------------------------------------------------------
Agent and Settlement Procedures:
-------------------------------
A. After the acceptance of an offer by the Company,
the Selling Agent or Purchasing Agent, as the case may be, will
communicate promptly, but in no event later than the time set
forth below under "Settlement Procedure Timetable", the following
details of the terms of such offer (the "Book-Entry Information")
to the Company by telephone (confirmed in writing) or by
facsimile transmission or other acceptable written means:
(1) Whether the Security is a Certificated Security or
a Book-Entry Security;
(2) Principal amount of Book-Entry Securities to be
purchased;
(3) Interest rate, interest payment dates, including
without limitation all necessary information with
respect to Floating Rate Notes, and initial
interest payment date;
(4) Stated Maturity Date;
(5) Issue Price;
(6) Selling Agent's commission or Purchasing Agent's
discount or commission, as the case may be;
(7) Net proceeds to the Company;
(8) Settlement Date (Original Issue Date);
(9) If a redeemable Book-Entry Security, such of the
following as are applicable:
(a) Initial Redemption Date;
(b) Initial Redemption Price (% of par);
(c) Amount (% of par) that the Redemption Price
shall decline (but not below par) ("Reduction
Percentage") and the dates on which such
Redemption Price shall decline after the
Initial Redemption Date; and
(d) Redemption Limitation Date.
(10) Exact name in which the Book-Entry Security is to
be registered, if other than Cede & Co.;
(11) Denomination of certificates to be delivered at
Settlement; and
(12) All other information necessary to complete the
form of Security prior to its authentication and
delivery.
B. The Company will advise Chase by Company Order in
writing or by facsimile or electronic transmission of the
information set forth in Settlement Procedure "A" above, and the
name of such Agent. Chase will assign a CUSIP number to the
Global Security representing such Book-Entry Security and will
notify the Company by telephone of such CUSIP number as soon as
practicable.
X. Xxxxx will enter a pending deposit message through
DTC's Participant Terminal System, providing the following
settlement information to DTC's Underwriting Department, such
Agent and Standard & Poor's Corporation:
(1) The applicable Book-Entry Information set forth in
Settlement Procedure A;
(2) Identification numbers of the participant accounts
maintained by DTC on behalf of Chase or the Agent,
as the case may be;
(3) Identification as a Book-Entry Security;
(4) Initial Interest Payment Date for such Book-Entry
Security and amount of interest payable on such
Interest Payment Date;
(5) CUSIP number of the Global Security representing
such Book-Entry Security; and
(6) Whether such Global Security will represent any
other Book-Entry Security (to the extent known at
such time).
D. The Trustee will complete and authenticate the
Global Security representing such Security, the form of which was
previously approved by the Company, the Agents and the Trustee.
E. DTC will credit such Book-Entry Security to
Chase's participant account at DTC.
X. Xxxxx will enter an SDFS deliver order through
DTC's Participant Terminal System instructing DTC to (i) debit
such Book-Entry Security to Chase's participant account and
credit such Book-Entry Security to such Agent's participant
account and (ii) debit such Agent's settlement account and credit
Chase's settlement account for an amount equal to the price of
such Book-Entry Security less such Agent's commission. The entry
of such a deliver order shall constitute a representation and
warranty by Chase to DTC that (a) the Global Security
representing such Book-Entry Security has been issued and
authenticated and (b) Chase is holding such Global Security
pursuant to the Certificate Agreement.
G. Such Agent will enter an SDFS deliver order
through DTC's Participant Terminal System instructing DTC (i) to
debit such Book-Entry Security to such Agent's participant
account and credit such Book-Entry Security to the participant
accounts of the Participants with respect to such Book-Entry
Security and (ii) to debit the settlement accounts of such
Participants and credit the settlement account of such Agent for
an amount equal to the price of such Book-Entry Security.
H. Transfers of funds in accordance with SDFS deliver
orders described in Settlement Procedures F and G will be settled
in accordance with SDFS operating procedures in effect on the
Settlement Date.
I. Upon confirmation of receipt of funds, Chase will
transfer to a bank account designated by the Company, in
immediately available funds, the amount transferred to Chase in
accordance with Settlement Procedure F.
J. Upon request, Chase will send to the Company a
statement setting forth the principal amount of Book-Entry
Securities outstanding as of that date under the Indenture.
K. Such Agent will confirm the purchase of such Book-
Entry Security to the purchaser either by transmitting to the
Participants with respect to such Book-Entry Security a
confirmation order or orders through DTC's institutional delivery
system or by mailing a written confirmation to such purchaser.
DTC will, upon request of the Company or Chase,
promptly furnish to the Company or Chase a list of the names and
addresses of the participants for whom DTC has credited Book-
Entry Securities.
Preparation of Pricing Supplement by Company:
--------------------------------------------
If the Company accepts an offer to purchase a Book-
Entry Security, it will prepare a Pricing Supplement. The
Company will arrange to have the Pricing Supplements filed with
the Commission not later than the close of business of the
Commission on the third Business Day following the date on which
such Pricing Supplement is first used or will arrange for such
Pricing Supplement to be transmitted to the Commission by a means
reasonably calculated to result in filing by such time and will
supply at least ten copies of such Pricing Supplement to the
Selling Agent or Purchasing Agent, as the case may be. In
addition, the Company will file as required copies of the Pricing
Supplement with the applicable state regulatory authorities
concurrently with the filing of the Pricing Supplement with the
Commission.
Delivery of Confirmation and Prospectus to Purchaser by Selling
---------------------------------------------------------------
Agent:
-----
The Selling Agent will deliver to the purchaser of a
Book-Entry Security a written confirmation of the sale and
delivery and payment instructions. In addition, the Selling
Agent will deliver to such purchaser or its agent the Prospectus
as amended or supplemented (including the Pricing Supplement)
relating to such Book-Entry Security prior to or together with
the earlier of the delivery to such purchaser or its agent of (a)
the confirmation of sale or (b) the Book-Entry Security.
Date of Settlement:
------------------
The receipt by the Company of immediately available
funds in payment for a Book-Entry Security shall constitute
"Settlement" with respect to such Book-Entry Security. All
orders accepted by the Company will be settled on a date (the
"Settlement Date") which is the third Business Day after the date
of acceptance of such offer, unless the Company and the purchaser
agree to settlement on any other Business Day after the
acceptance of such offer in each case pursuant to the Settlement
Procedures Timetable set forth below.
Settlement Procedures Timetable:
-------------------------------
For orders of Book-Entry Securities solicited by a
Selling Agent and accepted by the Company for Settlement on the
first Business Day after the sale date, Settlement Procedures A
through J set forth above shall be completed as soon as possible
but not later than the respective times (New York City time) set
forth below:
Settlement
Procedure Time
----------- ----
A-B 11 AM on the sale date
C 2 PM on the sale date
D 9 AM on the Settlement Date
E 10 AM on the Settlement Date
F 2 PM on the Settlement Date
G 4:45 PM on the Settlement Date
H-J 5 PM on the Settlement Date
If a sale is to be settled more than one Business Day
after the sale date, (i) Settlement Procedure A shall be
completed by 5 PM on the Business Day following the sale date or
11 AM on the Business Day prior to the Settlement Date, whichever
is earlier, and (ii) Settlement Procedures B and C shall be
completed as soon as practicable but no later than 2 PM on the
Business Day prior to the Settlement Date.
Settlement Procedure H is subject to extension in
accordance with any extension of Fedwire closing deadlines and in
other events specified in SDFS operating procedure in effect on
the Settlement Date.
If Settlement of a Book-Entry Security is rescheduled
or canceled, the Company will instruct Chase to deliver to DTC a
PTS cancellation message to such effect by no later than 12 Noon
and on the Business Day immediately preceding the scheduled
Settlement Date and Chase will enter such order by 2 PM on such
Business Day through DTC's Participation Terminal System.
The Company will, as soon as practicable after the
trade date for a Global Security (but no later than the dates and
times, if any, specified in the Indenture), cause to be delivered
to the Trustee an executed original of the Company Order for such
Global Security as well as all other documents required to be
delivered under the Indenture in connection with the issuance of
such Global Security, unless already delivered.
Failure to Settle
-----------------
If Chase has not entered an SDFS deliver order with
respect to a Book-Entry Security pursuant to Settlement Procedure
F, the Company may instruct Chase to deliver to DTC, through
DTC's Participant Terminal System, as soon as practicable, a
withdrawal message instructing DTC to debit such Book-Entry
Security to Chase's participant account. DTC will process the
withdrawal message, provided that Chase's participant account
contains a principal amount of the Global Security representing
such Book-Entry Security that is at least equal to the principal
amount to be debited. If a withdrawal message is processed with
respect to all the Book-Entry Securities represented by a Global
Security, Chase will xxxx such Global Security "canceled", make
appropriate entries in Chase's records and send such canceled
Global Security to the Company. The CUSIP number assigned to
such Global Note shall, in accordance with CUSIP Service Bureau
procedures, be canceled and not immediately reassigned. If a
withdrawal message is processed with respect to less than the
entire principal amount of the Book-Entry Securities represented
by a Global Security, Chase will exchange such Global Security
for two Global Securities, one of which shall represent the Book-
Entry Security or Securities for which a withdrawal message has
been processed and shall be canceled immediately after issuance
and the other of which shall represent the Book-Entry Security
previously represented by the surrendered Global Security with
respect to which a withdrawal message has not been processed and
shall bear the CUSIP number of the surrendered Global Security.
If the purchase price for any Book-Entry Security is
not timely paid to the Participants with respect to such Book-
Entry Security by the beneficial purchaser thereof (or a person,
including an indirect participant in DTC, acting on behalf of
such purchaser), such Participants and, in turn, the Agent for
such Book-Entry Security may enter SDFS deliver orders through
DTC's Participant Terminal System debiting such Book-Entry
Security to such Participant's account and crediting such Book-
Entry Security to such Agent's participant account and then
debiting such Book-Entry Security to such Agent's participant
account and crediting such Book-Entry Security to Chase's
participant account, and shall notify the Company and Chase
thereof. Thereafter, Chase will (i) immediately notify the
Company of such order, once Chase has confirmed that such Book-
Entry Security has been credited to its participant account, and
the Company shall transfer to such Agent funds available for
immediate use in an amount equal to the price of such Book-Entry
Security which was previously credited to the account of the
Company in accordance with Settlement Procedure I, and (ii)
deliver the withdrawal message and take the related actions
described in the preceding paragraph. If such failure shall have
occurred for any reason other than default by the Agent in the
performance of its obligations hereunder or under the
Distribution Agreement, the Company will reimburse the Agent on
an equitable basis for its loss of the use of funds during the
period when they were credited to the account of the Company;
provided, however, that the Selling Agent shall be entitled to no
reimbursement hereunder if funds are returned on the day on which
such funds had been previously credited to the account of the
Company such that the Selling Agent is afforded a reasonable
opportunity to invest such funds at an overnight rate on such
day; and provided further that if the Selling Agent is denied the
use of such funds due to its failure to return the relevant
Security to the Trustee in a timely manner it shall only be
entitled to reimbursement hereunder in an amount equal to the
amount that would have been earned on such funds had such funds
been on deposit at an overnight rate during the period between
their credit to the account of the Company and their
reimbursement to the Agent.
Notwithstanding the foregoing, upon any failure to
settle with respect to a Book-Entry Security, DTC may take any
actions in accordance with its SDFS operating procedures then in
effect. In the event of a failure to settle with respect to one
or more, but not all, of the Book-Entry Securities to have been
represented by a Global Security, the Trustee will provide, in
accordance with Settlement Procedure D for the authentication and
issuance of a Global Security representing the other Book-Entry
Securities to have been represented by such Global Security and
will make appropriate entries in its records.
