Exhibit 1(b)
AVISTA CORPORATION
COMMON STOCK
(NO PAR VALUE)
-----------------
UNDERWRITING AGREEMENT
___________, 200_
[Underwriters
Representative]
Ladies and Gentlemen:
Avista Corporation, a Washington corporation (the "Company"),
proposes, subject to the terms and conditions stated herein, to issue and sell
to the Underwriters named in Schedule I hereto (collectively, the
"Underwriters") for whom you are acting as representative (in such capacity you
shall hereinafter be referred to as the "Representative") an aggregate of
__________ shares (the "Shares") of Common Stock (no par value) ("Stock") of the
Company.
1. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) (i) A registration statement on Form S-3 (File No.
333-64652) in respect of the Shares and certain other securities has
been prepared and filed in accordance with the provisions of the
Securities Act of 1933, as amended (the "Act"), with the Securities and
Exchange Commission (the "Commission"); such registration statement has
been declared effective by the Commission, and no other document with
respect to the registration statement or documents incorporated by
reference therein has heretofore been filed or transmitted for filing
with the Commission (other than prospectuses filed pursuant to Rule
424(b) of the rules and regulations of the Commission under the Act,
each in the form heretofore delivered to the Underwriters). Such
registration statement, in the form in which it became effective and
(including the exhibits thereto, but excluding the Statements of
Eligibility in Form T-1) is hereinafter called the "Registration
Statement"; and the prospectus relating to the Shares, in the form in
which it was included in the Registration Statement at the time it
became effective, as supplemented by the prospectus supplement
containing the terms of the Shares and the terms of the offering
thereof, in the form in which it is filed with the Commission pursuant
to Rule 424(b) under the Act, is hereinafter called the "Prospectus";
(ii) Pursuant to Rule 429 under the Act, the
Prospectus will be used as a combined prospectus relating to the
Registration Statement and to (a) the registration statement filed by
the Company with the Commission on July 2, 1999 (registration no.
333-82165) which, as subsequently amended, became effective on August
17, 1999 and (b) the registration statement filed by the Company with
the Commission on June 25, 2003 (registration no. 333-106491) which, as
subsequently amended, became effective on August 20, 2003; unless the
context otherwise requires, all references in this Agreement to the
Registration Statement shall be deemed to include such prior
registration statements;
(iii) Any reference herein to the Registration
Statement or the Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein pursuant to Item 12 of Form
S-3 under the Act, as of the effective date or the date thereof, as the
case may be; any reference to any amendment to the Registration
Statement shall be deemed to refer to and include any annual report of
the Company filed pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") after the
effective date of the Registration Statement that is incorporated by
reference in the Registration Statement; and 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 such Prospectus,
under the Exchange Act and incorporated by reference in such
Prospectus.
(b) No stop order suspending the effectiveness of the
Registration Statement has been issued and no proceeding for that
purpose has been initiated or, to the best knowledge of the Company,
threatened by the Commission; and no order preventing or suspending the
use of any preliminary prospectus or the Prospectus has been issued by
the Commission;
(c) The Registration Statement, when it became effective,
conformed, and any further amendments thereto, when they become
effective, will conform, in all material respects to the requirements
of the Act, and the Prospectus and any amendments or supplements
thereto, when filed with the Commission, will conform in all material
respects to the requirements of the Act;
(d) The Registration Statement, when it became effective, and
any further amendments thereto when they become effective, did not 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 not misleading; and the Prospectus and any
amendments and supplements thereto, when they are filed or transmitted
for filing with the Commission and at the Time of Delivery, will not
include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements made, in light
of the circumstances under which they were made, not misleading;
provided, however, that the representations and warranties contained in
this subsection (d) shall not apply to statements or omissions made in
reliance upon and in conformity with
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information furnished in writing by an Underwriter through the
Representative expressly for use in the Registration Statement, the
Prospectus or any amendment or supplement to either thereof;
(e) The documents incorporated by reference in the Prospectus,
when they were filed with the Commission, and any further documents so
filed and incorporated by reference, when they are filed with the
Commission or become effective, as the case may be, (i) conformed and
will conform in all material respects to the requirements of the
Exchange Act or the Act, as the case may be, and the rules and
regulations of the Commission thereunder and (ii) did not and will not
include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements made, in light
of the circumstances under which they were made, not misleading;
(f) Except as set forth in or contemplated by the Prospectus,
(i) since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there has not been (A) any
material adverse change in or affecting the business, financial
condition, shareholders' equity or results of operations of the Company
and its subsidiaries, considered as a whole, or any development
reasonably expected to result in such a material adverse change (in
each case, a "Material Adverse Change"), (B) 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) any change in the capital stock or
long-term debt of the Company or any of its subsidiaries (except for
shares of common stock issued under the Company's Dividend-Reinvestment
and Stock Purchase Plan and employee stock plans and except for
scheduled maturities of long-term debt) and (ii) neither the Company
nor any of its subsidiaries has any contingent obligation which is
material to the Company and its subsidiaries as a whole;
(g) The Company has been duly incorporated and is validly
existing in good standing as a corporation under the laws of the State
of Washington, is duly qualified to do business and in good standing as
a foreign corporation under the laws of the States of California,
Idaho, Montana and Oregon, and has corporate and other power and
authority and has all material required approvals and authorizations to
own, lease and operate its properties, and to transact an electric
and/or gas public utility business in such jurisdictions;
(h) Each of Avista Capital Inc. ("Avista Capital"), Avista
Energy, Inc. ("Avista Energy") and Avista Advantage, Inc. ("Avista
Advantage") is duly incorporated and validly existing in good standing
under the laws of the State of Washington;
(i) All of the issued shares of capital stock of Avista
Capital, Avista Energy and Avista Advantage have been duly and validly
authorized and issued, are fully paid and non-assessable; _____ shares
of Avista Capital's capital stock are issued and outstanding and the
Company is the record holder of _____ shares
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of such capital stock; _____ shares of Avista Energy's capital stock
are issued and outstanding and Avista Capital is the record holder of
_____ shares of such capital stock; and _____ shares of Avista
Advantage's capital stock are issued and outstanding (excluding _____
shares of convertible preferred stock which is held by unrelated
parties) and Avista Capital is the record holder of _____ shares of
such capital stock and the ownership interests of Avista Capital,
Avista Energy and Avista Advantage that are owned directly or
indirectly by the Company are owned free and clear of all liens,
encumbrances, equities or claims;
(j) The Shares have been duly and validly authorized and, when
issued and delivered against payment therefore as provided herein, will
be duly and validly issued and fully paid and non-assessable and will
conform to the description of the Stock contained in the Prospectus;
(k) The Company has an authorized capitalization as set forth
in the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, are fully
paid and non-assessable;
(l) The issue and sale of the Shares and the compliance by the
Company with all of the provisions of this Agreement and the
consummation by the Company of the transactions herein contemplated
will not (i) violate the Company's Restated Articles of Incorporation,
as amended, or By-laws or (ii) result in a breach or violation of any
of the terms or provisions of, or constitute a default under, (A) any
statute or, to the knowledge of the Company, 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 subsidiaries or any of their properties, or (B) any
indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which the Company or any of its subsidiaries is a
party or by which the Company or any of its subsidiaries is bound or to
which any of the property or assets of the Company or any of its
subsidiaries is subject, which breach, violation or default referred to
in this clause (ii) would individually, or in the aggregate, have, or
would be reasonably expected to have, a material adverse effect on the
business, financial condition, shareholders' equity or results of
operations of the Company and its subsidiaries considered as a whole
(in each case, a "Material Adverse Effect"); and no consent, approval,
authorization, order, registration or qualification of or with any such
court or governmental agency or body is required for the issue and sale
of the Shares or the consummation by the Company of the transactions
contemplated by this Agreement, except the registration under the Act
of the Shares and such consents, approvals, authorizations,
registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of the Shares by the Underwriters, and such consents,
approvals, authorizations, filings or registrations as may be required
by the Washington Utilities and Transportation Commission (the "WUTC"),
the California Public Utilities Commission (the "CPUC"), the Idaho
Public Utilities Commission (the "IPUC"), the Public Service Commission
of the State of
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Montana (the "MPSC") and the Public Utility Commission of Oregon (the
"OPUC"), in each case in the manner contemplated hereby;
(m) None of the Company, Avista Capital, Avista Energy and
Avista Advantage is currently in violation of its Restated Articles of
Incorporation or By-laws, or in default in the performance or
observance of any material obligation, agreement, covenant or condition
contained in any material indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which it is a
party or by which it or any of its properties may be bound, except for
the performance or observance of any such obligation, agreement,
covenant or condition that has been waived in accordance with the
applicable agreement;
(n) Other than as set forth in the Prospectus, neither the
Company nor any of its subsidiaries (i) is in violation of any statute,
or any rule, regulation, decision or order of any governmental agency
or body or any court relating to the use, disposal or release of
hazardous or toxic substances or relating to the protection or
restoration of the environmental or human exposure to hazardous or
toxic substances (collectively, "environmental laws"), (ii) does not
own or operate any real property which to its knowledge is contaminated
with any substance that is subject to any environmental laws, (iii) is
not to its knowledge liable for any off-site disposal or contamination
pursuant to any environmental laws, and (iv) is not subject to any
claim relating to any environmental laws and the Company is not aware
of any pending investigation which could reasonably be expected to lead
to such a claim, which, in the case of (i), (ii), (iii), or (iv), would
reasonably be expected to result in a Material Adverse Effect;
(o) The statements set forth in the Prospectus under the
caption "Description of Common Stock", insofar as they purport to
constitute a summary of the terms of the Shares, and under the captions
"Underwriting" and "Plan of Distribution", insofar as they purport to
describe the provisions of the laws and documents referred to therein,
are accurate and fairly present the information purported to be given;
(p) Other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which the Company or any
of its subsidiaries is a party or of which any property of the Company
or any of its subsidiaries is the subject, which, if determined
adversely to the Company or any of its subsidiaries, would individually
or in the aggregate have a Material Adverse Effect; and, to the best of
the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
(q) The Company is not, and, after giving effect to the
offering and sale of the Shares, will not be an "investment company",
as such term is defined in the United States Investment Company Act of
1940, as amended (the "Investment Company Act");
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(r) [The Company is subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act;]and
(s) Deloitte & Touche LLP, who have certified certain
financial statements of the Company and its subsidiaries, are
independent public accountants as required by the Act and the rules and
regulations of the Commission thereunder.
2. Subject to the terms and conditions herein set forth, (a) the
Company agrees to issue and sell to each of the Underwriters, severally and not
jointly, and each of the Underwriters agrees, severally and not jointly, to
purchase from the Company, at a purchase price per share of $_______, the number
of Shares set forth opposite the name of such Underwriter in Schedule I hereto.
3. Upon the authorization by the Representative of the release of the
Shares, the several Underwriters propose to offer the Shares for sale upon the
terms and conditions set forth in this Agreement and the Prospectus.
4. (a) The Shares to be purchased by each Underwriter hereunder,
in definitive form, and in such authorized denominations and registered in such
names as the Representative may request upon at least forty-eight hours' prior
notice to the Company, shall be delivered by or on behalf of the Company to the
Representative, through the facilities of the Depository Trust Company ("DTC"),
for the account of such Underwriter, against payment by or on behalf of such
Underwriter of the purchase price therefore by wire transfer of Federal
(same-day) funds to the account specified by the Company to the Representative
at least forty-eight hours in advance. The Company will cause the certificates
representing the Shares to be made available to the Representative for checking
at least twenty-four hours prior to the Time of Delivery (as defined below) at
the office of DTC or its designated custodian (the "Designated Office"). The
time and date of such delivery and payment shall be ____ a.m. New York City
time, on _______, 200_ or such other date as the Representative and the Company
may agree upon in writing. Such time and date are herein called the "Time of
Delivery";
(b) The documents to be delivered at the Time of Delivery by
or on behalf of the parties hereto pursuant to Section 7 hereof, including the
cross receipt for the Shares and any additional documents requested by the
Underwriters pursuant to Section 7[(l)] hereof, will be delivered at the offices
of Xxxxx Xxxxxxxxxx LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000
(the "Closing Location"), and the Shares will be delivered at the Designated
Office, all at the Time of Delivery. A meeting will be held at the Closing
Location at _________, New York City time, on the New York Business Day next
preceding such Time of Delivery, at which meeting the final drafts of the
documents to be delivered pursuant to the preceding sentence will be available
for review by the parties hereto. For the purposes of this Agreement, "New York
Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday,
which is not a day on which banking institutions in New York are generally
authorized or obligated by law or executive order to close.
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5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by the
Representative and to file such Prospectus pursuant to Rule 424(b)
under the Act not later than the Commission's close of business on the
second business day following the execution and delivery of this
Agreement; to make no further amendment or any supplement to the
Registration Statement or Prospectus prior to the last Time of Delivery
which shall be reasonably disapproved by the Representative promptly
after reasonable notice thereof; to advise the Representative, promptly
after it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed
and to furnish the Representative with copies thereof; to file promptly
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 subsequent to the date of
the Prospectus and for so long as the delivery of a prospectus is
required in connection with the offering or sale of the Shares; to
advise the Representative, promptly after it receives notice thereof,
of the issuance by the Commission of any stop order or of any order
preventing or suspending the use of any prospectus, of the suspension
of the qualification of the Shares 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 amending
or supplementing of the Registration Statement or the Prospectus or for
additional information; and, in the event of the issuance of any stop
order or of any order preventing or suspending the use of any
prospectus or suspending any such qualification, promptly to use its
best efforts to obtain the withdrawal of such order;
(b) Promptly from time to time to take such action as the
Representative may reasonably request to qualify the Shares for
offering and sale under the securities laws of such jurisdictions as
the Representative may request and to comply with such laws so as to
permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the
distribution of the Shares, provided 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;
(c) Prior to __________, New York City time, on the New York
business day succeeding the date of this Agreement, or as soon
thereafter as may be reasonably practicable, to furnish the
Underwriters with written and electronic copies of the Prospectus in
such quantities as the Representative may from time to time reasonably
request, and, if the delivery of a prospectus is required at any time
prior to the expiration of nine months after the time of issue of the
Prospectus in connection with the offering or sale of the Shares 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
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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 during such period 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 or the
Exchange Act, to notify the Representative and upon their reasonable
request to file such document and to prepare and furnish without charge
to each Underwriter and to any dealer in securities as many written and
electronic copies as the Representative may from time to time
reasonably request of an amended Prospectus or a supplement to the
Prospectus which will correct such statement or omission or effect such
compliance, and in case any Underwriter is required to deliver a
prospectus in connection with sales of any of the Shares at any time
nine months or more after the time of issue of the Prospectus, upon
their request but at the expense of such Underwriter, to prepare and
deliver to such Underwriter as many written and electronic copies as
such Underwriter may request of an amended or supplemented Prospectus
complying with Section 10(a)(3) of the Act;
(d) To make generally available to its securityholders as soon
as practicable, but in any event not later than eighteen months after
the effective date of the Registration Statement (as defined in Rule
158(c) under the Act), an earnings statement of the Company and its
subsidiaries (which need not be audited) covering a period of at least
12 months beginning after the later of (i) the effective date of the
most recent post-effective amendment to the Registration Statement to
become effective prior to the date of this Agreement and (ii) the date
of the Company's most recent Annual Report on Form 10-K filed with the
Commission prior to the date of this Agreement, which will satisfy the
provisions of Section 11(a) of the Act and the rules and regulations
thereunder including Rule 158;
(e) During the period beginning from the date hereof and
continuing to and including the later of (i) the completion of the
distribution of the Shares, as shall be promptly notified to the
Company by the Representative upon such completion, but in no event
shall such period exceed [90] days from the Time of Delivery, and (ii)
the Time of Delivery, not to offer, sell, contract to sell or otherwise
dispose of, except as provided hereunder, any securities of the Company
that are substantially similar to the Shares, without the prior written
consent of the Representative [(it being understood that this paragraph
shall not prohibit the issuance of securities pursuant to employee
benefit plans, stock option plans or shareholder rights plans existing
on, or upon the conversion or exchange of convertible or exchangeable
securities outstanding as of, the date of this Agreement)];
(f) To use the net proceeds received by it from the sale of
the Shares pursuant to this Agreement in the manner specified in the
Prospectus under the caption "Use of Proceeds";
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(g) To use all commercially reasonable efforts to list,
subject to notice of issuance, the Shares on the New York Stock
Exchange (the "NYSE") and the Pacific Stock Exchange (the "PSE").
6. The Company hereby covenants and agrees with the several
Underwriters 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 Shares under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any preliminary prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
any agreement among Underwriters, this Agreement, the Blue Sky Memorandum,
closing documents (including any compilations thereof) and any other documents
in connection with the offering, purchase, sale and delivery of the Shares;
(iii) any expenses in connection with the qualification of the Shares for
offering and sale under state securities laws as provided in Section 5(b)
hereof, including the fees and disbursements of counsel for the Underwriters in
connection with such qualification and in connection with the Blue Sky survey,
if any; (iv) all fees and expenses in connection with listing the Shares on the
NYSE and the PSE; (v) any filing fees incident to, and the fees and
disbursements of counsel for the Underwriters in connection with any required
review by the National Association of Securities Dealers, Inc. of the terms of
the sale of the Shares; (vi) the cost of preparing the stock certificates; and
(vii) all other costs and expenses incident to the performance of its
obligations hereunder which are not otherwise specifically provided for in this
Section. It is understood, however, that, except as provided in this Section,
and Sections 8 and 11 hereof, the Underwriters will pay all of their own costs
and expenses, including the fees of their counsel, transfer taxes on resale of
any of the Shares by them, and any advertising expenses connected with any
offers they may make.
7. The obligations of the Underwriters hereunder shall be subject, in
the discretion of the Representative, to the condition that all representations
and warranties and other statements of the Company herein are, at and as of the
Time of Delivery, true and correct, the condition that the Company shall have
performed all of its obligations hereunder theretofore to be performed, and the
following additional conditions:
(a) The Prospectus shall have been filed 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 5(a) hereof; no stop order suspending
the effectiveness of the Registration Statement or any part thereof
shall have been issued and no proceeding for that purpose shall have
been initiated or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to the reasonable satisfaction of the Representative;
(b) There shall have been issued and there shall be in full
force and effect, (i) appropriate orders of the WUTC, the IPUC and the
OPUC permitting
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the issuance and sale of the Shares on the terms herein set forth or
contemplated, and containing no provision reasonably unacceptable to
the Representatives, it being understood that no such order in effect
on the date of this Agreement contains any such unacceptable provision,
and (ii) appropriate exemptive orders of the MPSC and the CPUC;
(c) Xxxxxxxx & Xxxxxxxx LLP, counsel for the Underwriters,
shall have furnished to the Representative such written opinion or
opinions, dated the Time of Delivery, with respect to the incorporation
of the Company, the Shares, the Registration Statement and the
Prospectus, as well as such other related matters as the Representative
may reasonably request, and 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 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 Xxxxxx Xxxxxx White & XxXxxxxxx LLP
referred to below;
(d) Xxxxx X. Xxxxx, Vice President and Chief Counsel for
Regulatory and Governmental Affairs for the Company, shall have
furnished to the Representative its written opinion or opinions, dated
the Time of Delivery, to the effect set forth in Exhibit A hereto;
(e) At the Time of Delivery, Xxxxxx Xxxxxx White & XxXxxxxxx
LLP and Xxxxx Xxxxxxxxxx LLP shall have furnished to the Representative
opinions, each dated as of the Time of Delivery, to the effect set
forth in Exhibit A hereto;
(f) On the date of the Prospectus at a time prior to the
execution of this Agreement and at the Time of Delivery, Deloitte &
Touche LLP shall have furnished to the Representative a letter or
letters, dated the respective dates of delivery thereof, in form and
substance satisfactory to the Representative;
(g) Except as set forth in or contemplated by the Prospectus,
(i) since the respective dates as of which information is given in the
Prospectus there shall not have been (A) any Material Adverse Change,
(B) 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, or
(C) any change in the capital stock or long-term debt of the Company or
any of its subsidiaries (except for shares of common stock issued under
the Company's Dividend-Reinvestment and Stock Purchase Plan and
employee stock plans and except for scheduled maturities of long-term
debt) and (ii) neither the Company nor any of its subsidiaries shall
have any contingent obligation which is material to the Company and its
subsidiaries as a whole, the effect of which, in the case of any such
event specified in clauses (i) or (ii) above, is in the judgment of the
Representative so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or delivery of the
Shares on the terms and in the manner contemplated in this Agreement or
in the Prospectus;
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(h) On or after the date hereof (i) no downgrading shall have
occurred in the rating accorded the Company's debt securities or
preferred stock by any "nationally recognized statistical rating
organization", as such term is defined by the Commission for purposes
of Rule 436(g)(2) under the Act, and (ii) no such organization shall
have publicly announced that it has under surveillance or review, with
possible negative implications, its rating of any of the Company's debt
securities or preferred stock;
(i) On or after the date hereof 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 or on
the Pacific Stock Exchange; (ii) a suspension or material limitation in
trading in the Company's securities 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 or a material disruption in commercial banking or
securities settlement or clearance services in the United States; or
(iv) the outbreak of hostilities or the escalation of existing
hostilities involving the United States or the declaration by the
United States of a national emergency or war, or the occurrence of any
other national or international calamity or crises, including without
limitation, acts of terrorism, or any change in financial, political or
economic conditions in the United States or elsewhere, if the effect of
any such event specified in this clause (iv) in the judgment of the
Representative, makes it impracticable or inadvisable to proceed with
the public offering or delivery of the Shares on the terms and in the
manner contemplated in the Prospectus;
(j) The Shares shall have been duly listed, subject to notice
of issuance, on the NYSE and the PSE;
(k) The Company shall have complied with the provisions of
Section 5(c) hereof with respect to the furnishing of prospectuses; and
(l) The Company shall have furnished or caused to be furnished
to the Representative at the Time of Delivery certificates of officers
of the Company satisfactory to the Representative as to the accuracy of
the representations and warranties of the Company herein at and as of
the Time of Delivery, as to the performance by the Company of all of
its obligations hereunder to be performed at or prior to the Time of
Delivery, as to the matters set forth in subsections (a) and (h) of
this Section and as to such other matters as the Representative may
reasonably request.
8. (a) The Company will indemnify and hold harmless each
Underwriter against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter 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 or the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission
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to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, and will reimburse each Underwriter
for any legal or other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such action or claim as such
expenses are incurred; 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 or the Prospectus or any such amendment or supplement in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through the Representative expressly for use therein
and PROVIDED, FURTHER, that the Company shall not be liable to any Underwriter
under this subsection in respect of any such loss, claim, damage or liability
arising out of or based upon an untrue statement or alleged untrue statement in,
or an omission or alleged omission from, any preliminary prospectus if (i) such
Underwriter sold securities to a person to whom it delivered a copy of such
preliminary prospectus, (ii) no copy of the Prospectus was delivered to such
person with or prior to the written confirmation of the sale involved, (iii) the
Company had previously furnished copies of the Prospectus in sufficient
quantities and sufficiently in advance of the Time of Delivery to allow for the
distribution thereof prior to the Time of Delivery and (iv) the defect in such
preliminary prospectus was corrected in the Prospectus;
(b) Each Underwriter 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 or the
Prospectus, 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 or the Prospectus or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through the
Representative expressly for use therein; and will reimburse the Company for any
legal or other expenses reasonably incurred by the Company in connection with
investigating or defending any such action or claim as such expenses are
incurred;
(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
12
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. Notwithstanding the foregoing, 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. The indemnifying party shall not, without the written
consent of the indemnified party, effect the settlement or compromise of, or
consent to the entry of any judgment with respect to, any pending or threatened
action or claim in respect of which indemnification or contribution may be
sought hereunder (whether or not the indemnified party is an actual or potential
party to such action or claim) unless such settlement, compromise or judgment
(i) includes an unconditional release of the indemnified party from all
liability arising out of such action or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act, by or
on behalf of any indemnified party. The indemnified party shall not, without the
written consent of the indemnifying party, effect the settlement or compromise
of, or consent to the entry of any judgment with respect to, any such pending or
threatened action or claim;
(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 the Underwriters
on the other from the offering of the Shares. If, however, the allocation
provided by the immediately preceding sentence is not permitted by applicable
law or if the indemnified party failed to give the notice required under
subsection (c) above, then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received by the
Company on the one hand and the Underwriters on the other shall be deemed to be
in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Company bear to the total underwriting
discounts and commissions received by the Underwriters, in each case as set
forth in the table on the cover page of the Prospectus.
13
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 relates to information
supplied by the Company on the one hand or the Underwriters 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 the Underwriters
agree that it would not be just and equitable if contribution pursuant to this
subsection (d) were determined by PRO RATA allocation (even if the Underwriters
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), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the Shares underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages which such Underwriter 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 Underwriters' obligations in this subsection (d) to
contribute are several in proportion to their respective underwriting
obligations and 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 Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section 8 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer and director of the Company and to each
person, if any, who controls the Company within the meaning of the Act;
9. (a) If any Underwriter shall default in its obligation to
purchase the Shares which it has agreed to purchase hereunder at a Time of
Delivery, the Representative may in its discretion arrange for itself or another
party or other parties to purchase such Shares on the terms contained herein. If
within thirty-six hours after such default by any Underwriter the Representative
does not arrange for the purchase of such Shares, then the Company shall be
entitled to a further period of thirty-six hours within which to procure another
party or other parties reasonably satisfactory to the Representative to purchase
such Shares on such terms. In the event that, within the respective prescribed
periods, the Representative notifies the Company that it has so arranged for the
purchase of such Shares, or the Company notifies the Representative that it has
so arranged for the purchase of such Shares, the Representative or the Company
shall have the right to postpone the Time of Delivery for a period of not more
than seven days, in order to effect whatever changes may thereby be made
necessary in the Registration Statement or the Prospectus, or in any other
documents or arrangements, and
14
the Company agrees to file promptly any amendments to the Registration Statement
or the Prospectus which, in the reasonable judgment of the Representative, may
thereby be made necessary. The term "Underwriter" as used in this Agreement
shall include any person substituted under this Section 9 with like effect as if
such person had originally been a party to this Agreement with respect to such
Shares;
(b) If, after giving effect to any arrangements for the
purchase of the Shares of a defaulting Underwriter or Underwriters by the
Representative and the Company as provided in subsection (a) above, the
aggregate number of such Shares which remains unpurchased does not exceed
one-tenth of the aggregate number of all the Shares to be purchased at the Time
of Delivery, then the Company shall have the right to require each
non-defaulting Underwriter to purchase the number of Shares which such
Underwriter agreed to purchase hereunder at the Time of Delivery and, in
addition, to require each non-defaulting Underwriter to purchase its PRO RATA
share (based on the number of Shares which such Underwriter agreed to purchase
hereunder) of the Shares of such defaulting Underwriter or Underwriters for
which such arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default;
(c) If, after giving effect to any arrangements for the
purchase of the Shares of a defaulting Underwriter or Underwriters by the
Representative and the Company as provided in subsection (a) above, the
aggregate number of such Shares which remains unpurchased exceeds one-tenth of
the aggregate number of all the Shares to be purchased at the Time of Delivery,
or if the Company shall not exercise the right described in subsection (b) above
to require non-defaulting Underwriters to purchase Shares of a defaulting
Underwriter or Underwriters, then this Agreement shall thereupon terminate,
without liability on the part of any non-defaulting Underwriter or the Company,
except for the expenses to be borne by the Company and the Underwriters as
provided in Section 6 hereof and the indemnity and contribution agreements in
Section 8 hereof; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several Underwriters, as set forth
in this Agreement or made by or on behalf of them, respectively, 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 Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or director or controlling person of the Company, and shall
survive delivery of and payment for the Shares.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
the Company shall not then be under any liability to any Underwriter except as
provided in Sections 6 and 8 hereof; but, if this Agreement is not consummated
for any other reason, the Company will reimburse the Underwriters through the
Representative for all out-of-pocket expenses approved in writing by the
Representative, including fees and disbursements of counsel, reasonably incurred
by the Underwriters in making preparations for the purchase, sale and delivery
of the Shares not so delivered, but the
15
Company shall then be under no further liability to any Underwriter except as
provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, the Representative shall act on behalf
of each of the Underwriters, and the parties hereto shall be entitled to act and
rely upon any statement, request, notice or agreement on behalf of any
Underwriter made or given by such Representative.
All statements, requests, notices and agreements hereunder
shall be in writing, and if to the Underwriters shall be delivered or sent by
mail, telex or facsimile transmission to the Representative at
_______________________________, Attention: __________________________ (with a
copy to the General Counsel at the same address); and if to the Company shall be
delivered or sent by mail to the address of the Company set forth in the
Registration Statement, Attention: Treasurer; Any such statements, requests,
notices or agreements shall take effect upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company and, to the extent provided in
Sections 8 and 10 hereof, the officers and directors of the Company and each
person who controls the Company or any Underwriter, and their respective heirs,
executors, administrators, successors and assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement. No purchaser of
any of the Shares from any Underwriter shall be deemed a successor or assign by
reason merely of such purchase.
14. Time shall be of the essence of this Agreement.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
----------------------
16
If the foregoing is in accordance with your understanding,
please sign and return to us [8] counterparts hereof, and upon the acceptance
hereof by you, on behalf of each of the Underwriters, this Agreement and such
acceptance hereof shall constitute a binding agreement between each of the
Underwriters and the Company. It is understood that the acceptance by you of
this letter on behalf of each of the Underwriters is pursuant to the authority
set forth in the Agreement Among Underwriters, a copy of which shall be
submitted to the Company for examination, but without warranty on the part of
the Representative as to the authority of the signers thereof (other than the
Representative).
Very truly yours,
AVISTA CORPORATION
By:
-----------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Senior Vice President, Chief Financial Officer and Treasurer
Accepted as of the date hereof:
--------------------
By:
----------------------------------------
Name:
Title:
On behalf of each of the Underwriters
17
SCHEDULE I
NUMBER OF
UNDERWRITER SHARES TO BE PURCHASED
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.......................
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Total............................................
18
EXHIBIT A
CONTENTS OF OPINIONS OF COUNSEL
