Exhibit 1(a)
AVISTA CORPORATION
FIRST MORTGAGE BONDS, _____% SERIES DUE ____
-----------------
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
$__________ principal amount of the First Mortgage Bonds, _____% Series due ____
(the "Securities"), as set forth in Schedule I hereto. The Securities are to be
issued as an additional series of bonds under the Mortgage and Deed of Trust,
dated as of June 1, 1939, between the Company and Citibank, N.A., as trustee
(the "Trustee"), as amended and supplemented by various supplemental indentures
including the _____________ Supplemental Indenture, dated as of _________ 1,
200_. Such Mortgage and Deed of Trust, as so amended and supplemented, and such
_____________ Supplemental Indenture are hereinafter called, respectively, the
"Mortgage" and the "Supplemental Indenture".
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 Securities 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 Securities, 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 Securities 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
Trust Indenture Act of 1939, as amended (the "Trust Indenture 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 and the Trust Indenture 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
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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 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;
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(h) Each of Avista Capital, Inc., Avista Energy, Inc. and Avista
Advantage, Inc. 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 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 Securities have been duly authorized by all necessary
corporate action on the part of the Company, and have been duly executed by
the Company and, when duly authenticated and delivered by the Trustee under
the Mortgage, and issued, delivered and paid for in accordance with this
Agreement, will be duly issued and delivered by the Company and will
constitute valid and binding obligations of the Company, entitled to the
benefits provided by the Mortgage and enforceable against the Company in
accordance with their terms, subject, as to enforcement, (i) to bankruptcy,
insolvency, reorganization, arrangement, moratorium and other laws of
general applicability relating to or affecting creditors' rights, and (ii)
by general principles of equity, whether such enforceability is considered
a proceeding in equity or at law, and by rules of law governing specific
performance, injunction relief, foreclosure, receivership and other
equitable remedies (the "Enforceability Exceptions"), and are entitled to
the benefits provided by the Mortgage; the Securities will be substantially
in the form previously delivered to the Representative; and the Securities
will conform in all material respects to the description thereof 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 Mortgage has been duly authorized and the Mortgage (excluding
the Supplemental Indenture) has been duly executed and delivered; when the
Supplemental Indenture is duly executed, delivered and appropriately
recorded, the Mortgage will constitute a valid and legally binding
instrument, enforceable in accordance with its terms, subject as to
enforcement, to the Enforceability Exceptions; and except, further, to the
extent that the law of the jurisdictions in which the mortgaged property is
located may limit or deny certain remedial provisions of the Mortgage; the
Mortgage has been duly qualified under the Trust Indenture Act; and the
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Mortgage will conform in all material respects to the description thereof
contained in the Prospectus;
(m) The Company has good and marketable title in fee simple to all of
its real estate and fixed properties and good title to all of its other
property, subject only (i) to the lien of the Mortgage, (ii) to leases of
minor portions of the Company's property to others for uses which do not
interfere with the Company's business; (iii) to leases of certain property
of the Company not used in its utility business, (iv) to Excepted
Encumbrances (as defined in the Mortgage) and (v) to encumbrances, defects
and irregularities customarily found in properties of like size and
character, which, in the Company's opinion, do not materially impair the
use of the property affected thereby in the operation of the business of
the Company; upon the due execution, delivery and appropriate recording of
the Supplemental Indenture, the Mortgage will constitute, subject only to
the exceptions enumerated immediately above, a valid first mortgage lien
for the security of the Securities and all other bonds issued and presently
outstanding thereunder on such properties, which include substantially all
of the physical properties and franchises of the Company other than those
expressly excepted;
(n) The description in the Mortgage of the properties intended to be
subject to the Mortgage is adequate to constitute a lien thereon; and the
Mortgage (excluding the Supplemental Indenture) has been duly and properly
recorded in the proper offices of the respective counties in which the real
estate and other physical properties of the Company are located, and the
Supplemental Indenture will be so recorded forthwith, and no other
recording or filing of the Mortgage is or will be necessary to maintain or
perfect of record the lien thereof;
(o) The issue and sale of the Securities and the compliance by the
Company with all of the provisions of the Securities, the Mortgage and this
Agreement and the consummation by the Company of the transactions herein
and therein 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 Securities or the consummation by
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the Company of the transactions contemplated by this Agreement or the
Mortgage, except the registration under the Act of the Securities 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 Securities 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 Montana (the "MPSC") and the Public Utility Commission of
Oregon (the "OPUC"), in each case in the manner contemplated hereby;
(p) None of the Company, Avista Capital, Inc., Avista Energy, Inc. and
Avista Advantage, Inc. 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;
(q) 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;
(r) The statements set forth in the Prospectus under the captions
["Description of the Offered Bonds"] and ["Description of the Bonds"],
insofar as they purport to constitute a summary of the terms of the
Securities, 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;
(s) 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
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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;
(t) The Company is not, and, after giving effect to the offering and
sale of the Securities, 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");
(u) The Company is subject to the reporting requirements of Section 13
or 15(d) of the Exchange Act; and
(v) 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 of ______% of the principal amount thereof,
plus accrued interest, if any, from ___________, 200_ to the Time of Delivery
hereunder, the principal amount of the securities set forth opposite the name of
such Underwriter in Schedule I hereto.
3. Upon the authorization by the Representative of the release of the
Securities, the several Underwriters propose to offer the Securities for sale
upon the terms and conditions set forth in this Agreement and the Prospectus.
4. (a) The Securities to be purchased by each Underwriter hereunder will be
represented by one or more definitive global Securities in book-entry form to be
deposited with The Depository Trust Company ("DTC") or its designated custodian.
The Company will deliver the global Securities to DTC or such custodian to be
credited to the account of the Representative, for the account of each
Underwriter, against payment by or on behalf of such Underwriter of the purchase
price therefore by wire transfer of Federal (same day) funds. The Company will
cause the certificates representing the Securities 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 __________, New York City time, on ___________, 200_ or such other time and
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 Securities and any additional documents requested by
the Underwriters pursuant to Section 7(k) 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 Securities will be delivered
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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.
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 Securities; 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 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 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 Securities 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 Securities,
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;
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(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 Securities 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 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, the Exchange
Act or the Trust Indenture 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 Securities 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
Securities, 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 debt securities of the Company that are
substantially similar to the Securities, without the prior written consent
of the Representative (it being understood that this paragraph shall not
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prohibit the issuance of commercial paper or other debt securities with
scheduled maturities of less than one year, debt securities issued in
connection with any credit facility, or debt securities issued as
collateral for other obligations);
(f) To use the net proceeds received by it from the sale of the
Securities pursuant to this Agreement in the manner specified in the
Prospectus under the caption "Use of Proceeds";
(g) To obtain title insurance (or an endorsement thereto) as of the
Time of Delivery on terms reasonably acceptable to the Representative and
in accordance with all applicable laws and regulations, naming the Trustee
(on behalf of the holders of all securities issued and outstanding under
the Mortgage) as the insured (without any co-insurance exception), and in
an amount not less than $__________ covering all real estate and
improvements affixed thereto that are subject to the lien created by the
Mortgage.
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 Securities 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, any supplemental indenture
under the Mortgage, 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 Securities; (iii) any expenses in connection
with the qualification of the Securities 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) any fees
charged by securities rating services for rating the Securities; (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 Securities; (vi) the cost of
preparing the Securities; (vii) the fees and expenses of the Trustee and any
agent of the Trustee and the fees and disbursements of counsel for the Trustee
in connection with any supplemental indenture under the Mortgage and the
Securities; and (viii) 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 Securities 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
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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 the issuance and sale of the Securities 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
Mortgage, the Securities, 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 to 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;
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(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 Securities on the terms and in the
manner contemplated in this Agreement or in the Prospectus;
(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 Securities on the
terms and in the manner contemplated in the Prospectus;
(j) The Company shall have complied with the provisions of Section
5(c) hereof with respect to the furnishing of prospectuses; and
(k) 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
12
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) (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 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
13
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
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
14
offering of the Securities. 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. 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 Securities 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;
15
9. (a) (a) If any Underwriter shall default in its obligation to purchase
the Securities 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 Securities 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 Securities, 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 Securities 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 Securities, or the Company notifies the
Representative that it has so arranged for the purchase of such Securities, 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 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 Securities;
(b) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Underwriter or Underwriters by the Representative and
the Company as provided in subsection (a) above, the aggregate principal amount
of such Securities which remains unpurchased does not exceed one-tenth of the
aggregate principal amount of all the Securities to be purchased at the Time of
Delivery, then the Company shall have the right to require each non-defaulting
Underwriter to purchase the principal amount of Securities 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 principal amount of Securities which such Underwriter agreed
to purchase hereunder) of the Securities 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
Securities of a defaulting Underwriter or Underwriters by the Representative and
the Company as provided in subsection (a) above, the aggregate principal amount
of such Securities which remains unpurchased exceeds one-tenth of the aggregate
principal amount of all the Securities 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 Securities 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.
16
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 Securities.
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 Securities not so delivered, but the 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
Securities 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.
17
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
18
SCHEDULE I
PRINCIPAL AMOUNT OF
UNDERWRITER SECURITIES TO BE PURCHASED
----------- --------------------------
............ $
............
Total................................. $
================================================================================
19
EXHIBIT A
CONTENTS OF OPINIONS OF COUNSEL
