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REGISTRATION NO. 333-39551
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
AMENDMENT NO. 1
TO
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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THE WASHINGTON WATER POWER COMPANY
(Exact name of registrant as specified in its charter)
WASHINGTON 91-0462470
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1411 East Mission Avenue
Spokane, Washington 99202
(509) 489-0500
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
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J.E. ELIASSEN, Senior Vice President, J. ANTHONY TERRELL
Chief Financial Officer & Treasurer Reid & Priest LLP
The Washington Water Power Company 40 West 57th Street
1411 East Mission Avenue New York, New York 10019
Spokane, Washington 99202 (212) 603-2000
(509) 489-0500
(Name and address, including zip code, and telephone number,
including area code, of agents for service)
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It is respectfully requested that the Commission
send copies of all notices, orders and communications to:
John E. Baumgardner, Jr.
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
(212) 558-4000
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INFORMATION CONTAINED IN THIS PROSPECTUS IS SUBJECT TO COMPLETION
OR AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE
SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO
BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER
TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE
ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER,
SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR
QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED , 1998
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PROSPECTUS
$250,000,000
THE WASHINGTON WATER POWER COMPANY
DEBT SECURITIES
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The Washington Water Power Company (the "Company"), a
Washington corporation, intends from time to time to issue up to
$250,000,000 aggregate principal amount of its Debt Securities,
in one or more series, on terms to be determined at the time or
times of sale.
The terms of the Debt Securities in respect of which this
Prospectus is being delivered, including where applicable the
series designation, the principal amount of the series, the
maturity date or dates, the rate or rates and times of payment of
interest, the initial public offering price, the provisions for
redemption, if any, and other provisions, are set forth in one or
more Prospectus Supplements (each a "Prospectus Supplement"),
together with the terms of offering such Debt Securities. The
Debt Securities may be sold by the Company through underwriters
or dealers, directly or through agents for offering pursuant to
the terms fixed at the time of sale. See "Plan of Distribution"
herein.
This Prospectus may not be used to consummate sales of
securities unless accompanied by a Prospectus Supplement.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is , 1998
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AVAILABLE INFORMATION
This Prospectus constitutes a part of a Registration
Statement on Form S-3 (together with all amendments and exhibits
thereto, the "Registration Statement") filed by the Company with
the Securities and Exchange Commission (the "SEC" or the
"Commission") under the Securities Act of 1933, as amended (the
"Securities Act"), with respect to the securities offered hereby.
This Prospectus does not contain all of the information set forth
in such Registration Statement, certain parts of which are
omitted in accordance with the rules and regulations of the SEC,
although it does include a summary of the material terms of the
Indenture (as defined herein). Reference is made to such
Registration Statement and to the exhibits relating thereto for
further information with respect to the Company and the
securities offered hereby. Any statements contained herein
concerning the provisions of any document filed as an exhibit to
the Registration Statement or otherwise filed with the SEC or
incorporated by reference herein are not necessarily complete,
and, in each instance, reference is made to the copy of such
document so filed for a more complete description of the matter
involved. Each such statement is qualified in its entirety by
such reference.
The Company is subject to the informational requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and in accordance therewith files reports, proxy
statements and other information with the SEC. Information, as of
particular dates, concerning the Company's directors and
officers, their remuneration, the principal holders of the
Company's securities, and any material interest of such persons
in transactions with the Company is disclosed in proxy statements
distributed to shareholders of the Company and filed with the
SEC. These reports, proxy statements and other information can be
inspected and copied at the public reference facilities of the
SEC at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C.
20549; 7 World Trade Center, 13th Floor, New York, New York
10048; and 500 West Madison Street, 14th Floor, Chicago, Illinois
60601; and copies of such material can be obtained from the
Public Reference Section of the SEC, Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549 at prescribed rates. The SEC
maintains a Web site that contains reports, proxy and information
statements and other information regarding reporting companies
under the Exchange Act, including the Company, at
http://www.sec.gov. The Company's Common Stock is listed on the
New York and Pacific Stock Exchanges, and reports, proxy
statements and other information concerning the Company can be
inspected at the offices of such exchanges located at the New
York Stock Exchange, 20 Broad Street, New York, New York 10005,
and the Pacific Stock Exchange, 301 Pine Street, San Francisco,
California 94104, respectively.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company hereby incorporates herein by reference, and as
of any time hereafter prior to the termination of the offering
made by this Prospectus the Company shall be deemed to have
incorporated herein by reference, (1) the Company's latest Annual
Report on Form 10-K (the "Latest Annual Report") filed by the
Company with the SEC pursuant to the Exchange Act and (2) all
other reports and documents filed by the Company with the SEC
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act
subsequent to the filing of the Latest Annual Report, and all of
such documents shall be deemed to be a part hereof from the
respective dates of filing thereof. The documents incorporated
herein by reference are sometimes hereinafter called the
"Incorporated Documents." Any statement contained in an
Incorporated Document shall be deemed to be modified or
superseded for all purposes to the extent that a statement in
this Prospectus or in any subsequently filed Incorporated
Document modifies or replaces such statement. The Incorporated
Document incorporated herein by reference as of the date of this
Prospectus is the Annual Report on Form 10-K for the year ended
December 31, 1997.
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THE COMPANY HEREBY UNDERTAKES TO PROVIDE WITHOUT CHARGE TO
EACH PERSON TO WHOM A COPY OF THIS PROSPECTUS HAS BEEN DELIVERED,
ON THE WRITTEN OR ORAL REQUEST OF ANY SUCH PERSON, A COPY OF ANY
OR ALL OF THE INCORPORATED DOCUMENTS, OTHER THAN EXHIBITS THERETO
(UNLESS SUCH EXHIBITS ARE SPECIFICALLY INCORPORATED BY REFERENCE
INTO SUCH INCORPORATED DOCUMENTS). REQUESTS FOR SUCH COPIES
SHOULD BE DIRECTED TO: TREASURER, BY MAIL AT THE WASHINGTON
WATER POWER COMPANY, POST OFFICE BOX 3727, SPOKANE, WASHINGTON
99220, OR BY TELEPHONE AT 509-489-0500.
THE WASHINGTON WATER POWER COMPANY
The Company, which was incorporated in the State of
Washington in 1889, primarily operates in the electric and
natural gas utility businesses. At December 31, 1997, the
Company's employees included 1,467 people in its utility
operations and approximately 1,751 people in its majority-owned
non-regulated business (energy and non-energy). The Company's
corporate headquarters are located at 1411 East Mission Avenue,
in Spokane, Washington 99202, which serves as the Inland
Northwest's center for manufacturing, transportation, healthcare,
education, communication, agricultural and service businesses.
Regulatory, economic and technological changes have brought
about the accelerating transformation of the electric utility
industry from a vertically integrated monopoly to separate market
driven businesses. Since 1996, the Company has reorganized its
operations to take advantage of the changes in the Company's
business environment and to proactively respond to regulatory and
structural changes in the industry. The restructuring reinforces
the Company's commitment to and advocacy of utility industry
deregulation.
The Company's operations are organized into four lines of
businesses, two of which comprise its utility operations. The
Energy Delivery business provides electricity and natural gas in
a 26,000 square mile in eastern Washington and northern Idaho,
with a combined population of approximately 825,000, as of
December 31, 1997, as well as natural gas services in a 4,000
square mile area in northeast and southwest Oregon and South Lake
Tahoe region of California, with a combined population of
approximately 495,000, as of such date. The Generation and
Resources business includes the generation and production of
electric energy, and short- and long-term electric and natural
gas wholesale sales and wholesale marketing primarily to, and
commodity trading with, other utilities and power brokers in the
Western Systems Coordinating Council. The National Energy
Trading and Marketing business, which is conducted through
subsidiaries, focuses on commodity trading, energy marketing and
energy related products and services on a national basis. The
Non-energy business, which is conducted through a subsidiary,
involves acquiring controlling interests in a broad range of
middle-market companies, helping these companies grow through
internal development and strategic acquisitions and selling the
portfolio investments either to the public or to strategic buyers
when it becomes most advantageous to do so.
USE OF PROCEEDS
The Company intends to use the net proceeds from the
issuance and sale of the Debt Securities for any or all of the
following purposes: (a) to fund a portion of the Company's
construction, facility improvement and maintenance programs, (b)
to retire one or more outstanding series of its preferred stock,
bonds or long-term notes, (c) to reduce or eliminate outstanding
short-term debt issued for any of these purposes, (d) to
reimburse the Company's treasury for funds previously expended
for any of these purposes and (e) for other general corporate
purposes.
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DESCRIPTION OF THE DEBT SECURITIES
GENERAL
The Debt Securities may be issued from time to time in one or
more series under an Indenture, dated as of 1, 1998
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(the "Original Indenture"), between the Company and The Chase
Manhattan Bank, as trustee (the "Trustee"), the Original
Indenture, as amended and supplemented from time to time, being
hereinafter referred to as the "Indenture." The terms of the Debt
Securities will include those stated in the Indenture and those
made part of the Indenture by reference to the Trust Indenture
Act. The following summary does not purport to be complete and
is subject in all respects to the provisions of, and is qualified
in its entirety by reference to, the Indenture, which is filed as
an exhibit to the Registration Statement of which this Prospectus
forms a part, and the Trust Indenture Act. Capitalized terms
used under this heading which are not otherwise defined in this
Prospectus shall have the meanings ascribed thereto in the
Indenture. Whenever particular provisions or defined terms in
the Indenture are referred to herein, such provisions or defined
terms are incorporated by reference herein.
The Indenture provides that, in addition to the Debt
Securities, additional debt securities may be issued thereunder,
without limitation as to aggregate principal amount. The Debt
Securities and all other debt securities issued under the
Indenture are collectively referred to herein as the "Indenture
Securities." Each series of Indenture Securities will be
unsecured and will rank pari passu with all other series of
Indenture Securities, except as otherwise provided in the
Indenture, and with all other unsecured and unsubordinated
indebtedness of the Company. Except as otherwise described in
the applicable Prospectus Supplement, the Indenture does not
limit the incurrence or issuance of other secured or unsecured
debt of the Company, whether under the Indenture, any other
indenture that the Company may enter into in the future or
otherwise. See the Prospectus Supplement relating to any
offering of Debt Securities.
At December 31, 1997, the total long-term debt of the Company
and its consolidated subsidiaries, as shown in the Company's
consolidated financial statements, was approximately $762.2
million. Of such amount, $171.6 represents long-term unsecured
and unsubordinated indebtedness of the Company, with which the
Debt Securities will be pari passu, and $445.2 million represents
secured indebtedness of the Company. The balance of $145.4
million includes short-term notes to be refinanced as well as
indebtedness of subsidiaries. Consolidated long-term debt does
not include the Company's subordinated indebtedness held by the
issuers of Company-obligated preferred trust securities.
Reference is made to the consolidated financial statements and
notes thereto contained in the Latest Annual Report and
subsequently filed Incorporated Documents for more detailed and
more recent information.
The applicable Prospectus Supplement or Prospectus Supplements
will describe the following terms of such Debt Securities: (a) the
title of such Debt Securities; (b) any limit upon the aggregate
principal amount of such Debt Securities; (c) the date or dates on
which the principal of such Debt Securities is payable or the
method of determination thereof and the right, if any, to extend
such date or dates; (d) the rate or rates at which such Debt
Securities will bear interest, if any, or the method by which
such rate or rates, if any, will be determined, the date or
dates from which any such interest will accrue, the Interest
Payment Dates on which any such interest will be payable, the
right, if any, of the Company to defer or extend an Interest
Payment Date, and the Regular Record Date for any interest
payable on any Interest Payment Date and the person or persons to
whom interest on such Debt Securities will be payable on any
Interest Payment Date, if other than the persons in whose names
such Debt Securities are registered at the close of business on
the Regular Record Date for such interest; (e) the place or
places where, subject to the terms of the Indenture as described
below under "-- Payment and Paying Agents," the principal of and
premium, if any, and interest, if any, on such Debt Securities
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will be payable and where, subject to the terms of the Indenture
as described below under "-- Registration and Transfer," such Debt
Securities may be presented for registration of transfer or
exchange and the place or places where notices and demands to or
upon the Company in respect of such Debt Securities and the
Indenture may be served; the Security Registrar and Paying Agents
for such Debt Securities; and, if such is the case, that the
principal of such Debt Securities will be payable without
presentation or surrender thereof; (f) any period or periods
within, or date or dates on, which, the price or prices at which
and the terms and conditions upon which such Debt Securities may
be redeemed, in whole or in part, at the option of the Company;
(g) the obligation or obligations, if any, of the Company to
redeem or purchase any of such Debt Securities pursuant to any
sinking fund or other mandatory redemption provisions or at the
option of the holder thereof, and the period or periods within,
or date or dates on, which, the price or prices at which, and the
terms and conditions upon which such Debt Securities will be
redeemed or purchased, in whole or in part, pursuant to such
obligation, and applicable exceptions to the requirements of a
notice of redemption in the case of mandatory redemption or
redemption at the option of the holder; (h) the denominations in
which any Debt Securities will be issuable if other than
denominations of $1,000 and any integral multiple thereof; (i) if
such Debt Securities are to be issued in global form, the identity
of the depositary thereof; and (j) any other terms of such Debt
Securities.
PAYMENT AND PAYING AGENTS
Except as may be provided in the applicable Prospectus
Supplement, interest, if any, on each Debt Security payable on
each Interest Payment Date will be paid to the person in whose
name such Debt Security is registered as of the close of business
on the regular record date relating to such Interest Payment Date
(each such period of interest accrual being hereinafter called a
"Scheduled Interest Period"); provided, however, that interest
payable at maturity (whether at stated maturity, upon redemption
or otherwise, hereinafter "Maturity") will be paid to the person
to whom principal is paid. However, if there has been a default
in the payment of interest on any Debt Security, such defaulted
interest may be payable to the holder of such Debt Security as of
the close of business on a date selected by the Trustee which is
not more than 30 days and not less than 10 days prior to the date
proposed by the Company for payment of such defaulted interest or
in any other lawful manner not inconsistent with the requirements
of any securities exchange on which such Debt Security may be
listed, if the Trustee deems such manner of payment practicable.
Unless otherwise specified in the applicable Prospectus
Supplement, the principal of and premium, if any, and interest,
if any, on the Debt Securities at Maturity will be payable upon
presentation of the Debt Securities at the corporate trust office
of The Chase Manhattan Bank in New York, New York, as Paying
Agent for the Company. The Company may change the Place of
Payment on the Debt Securities, may appoint one or more
additional Paying Agents (including the Company) and may remove
any Paying Agent, all at its discretion.
REGISTRATION AND TRANSFER
Unless otherwise specified in the applicable Prospectus
Supplement, the transfer of Debt Securities may be registered,
and Debt Securities may be exchanged for other Debt Securities of
the same series and tranche, of authorized denominations and of
like tenor and aggregate principal amount, at the corporate trust
office of The Chase Manhattan Bank in New York, New York, as
Security Registrar for the Debt Securities. The Company may
change the place for registration of transfer and exchange of the
Debt Securities and may designate one or more additional places
for such registration and exchange, all at its discretion.
Except as otherwise provided in the applicable Prospectus
Supplement, no service charge will be made for any transfer or
exchange of the Debt Securities, but the Company may require
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payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any
registration of transfer or exchange of the Debt Securities. The
Company will not be required to execute or to provide for the
registration of transfer of or the exchange of (a) any Debt
Security during a period of 15 days prior to giving any notice of
redemption or (b) any Debt Security selected for redemption in
whole or in part, except the unredeemed portion of any Debt
Security being redeemed in part.
REDEMPTION
Any terms for the optional or mandatory redemption of Debt
Securities will be set forth in the applicable Prospectus
Supplement. Except as shall otherwise be provided in the
applicable Prospectus Supplement with respect to Debt Securities
redeemable at the option of the holder, Debt Securities will be
redeemable only upon notice by mail not less than 30 nor more
than 60 days prior to the date fixed for redemption, and, if less
than all the Debt Securities of a series, or any tranche thereof,
are to be redeemed, the particular Debt Securities to be redeemed
will be selected by such method as shall be provided for such
series or tranche, or in the absence of any such provision, by
such method of random selection as the Security Registrar deems
fair and appropriate.
Any notice of redemption at the option of the Company may
state that such redemption will be conditional upon receipt by
the Paying Agent or Agents, on or prior to the dates fixed for
such redemption, of money sufficient to pay the principal of and
premium, if any, and interest, if any, on such Debt Securities
and that if such money has not been so received, such notice will
be of no force or effect and the Company will not be required to
redeem such Debt Securities.
MODIFICATION OF INDENTURE
Without the consent of any holders of Indenture Securities,
the Company and the Trustee may enter into one or more
supplemental indentures for any of the following purposes:
(a) to evidence the succession of another Person to the
Company and the assumption by any such successor of the covenants
of the Company in the Indenture and in the Indenture Securities;
or
(b) to add one or more covenants of the Company or other
provisions for the benefit of all holders of Indenture Securities
or for the benefit of the holders of, or to remain in effect only
so long as there shall be outstanding, Indenture Securities of
one or more specified series, or one or more tranches thereof, or
to surrender any right or power conferred upon the Company by the
Indenture; or
(c) to change or eliminate any provision of the Indenture or
to add any new provision to the Indenture, provided that if such
change, elimination or addition adversely affects the interests
of the holders of the Indenture Securities of any series or
tranche in any material respect, such change, elimination or
addition will become effective with respect to such series or
tranche only when no Indenture Security of such series or tranche
remains outstanding; or
(d) to provide collateral security for the Indenture
Securities or any series thereof; or
(e) to establish the form or terms of the Indenture Securities
of any series or tranche as permitted by the Indenture; or
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(f) to provide for the authentication and delivery of bearer
securities and coupons appertaining thereto representing
interest, if any, thereon and for the procedures for the
registration, exchange and replacement thereof and for the giving
of notice to, and the solicitation of the vote or consent of, the
holders thereof, and for any and all other matters incidental
thereto; or
(g) to evidence and provide for the acceptance of appointment
by a successor trustee with respect to the Indenture Securities
of one or more series; or
(h) to provide for the procedures required to permit the
utilization of a non-certificated system of registration for all,
or any series or tranche of, the Indenture Securities; or
(i) to change any place or places where (1) the principal of
and premium, if any, and interest, if any, on all or any series
of Indenture Securities, or any tranche thereof, will be payable,
(2) all or any series of Indenture Securities, or any tranche
thereof, may be surrendered for registration of transfer, (3) all
or any series of Indenture Securities, or any tranche thereof,
may be surrendered for exchange and (4) notices and demands to or
upon the Company in respect of all or any series of Indenture
Securities, or any tranche thereof, and the Indenture may be
served; or
(j) to cure any ambiguity, to correct or supplement any
provision therein which may be defective or inconsistent with any
other provision therein, or to make any other changes to the
provisions thereof or to add other provisions with respect to
matters and questions arising under the Indenture, so long as
such other changes or additions do not adversely affect the
interests of the holders of Indenture Securities of any series or
tranche in any material respect.
Without limiting the generality of the foregoing, if the Trust
Indenture Act is amended after the date of the Original Indenture
in such a way as to require changes to the Indenture or the
incorporation therein of additional provisions or so as to permit
changes to, or the elimination of, provisions which, at the date
of the Original Indenture or at any time thereafter, were
required by the Trust Indenture Act to be contained in the
Indenture, the Indenture will be deemed to have been amended so
as to conform to such amendment or to effect such changes or
elimination, and the Company and the Trustee may, without the
consent of any holders of Indenture Securities, enter into one or
more supplemental indentures to evidence or effect such
amendment.
Except as provided above, the consent of the holders of a
majority in aggregate principal amount of the Indenture
Securities of all series then outstanding, considered as one
class, is required for the purpose of adding any provisions to,
or changing in any manner, or eliminating any of the provisions
of, the Indenture pursuant to one or more supplemental
indentures; provided, however, that if less than all of the
series of Indenture Securities outstanding are directly affected
by a proposed supplemental indenture, then the consent only of
the holders of a majority in aggregate principal amount of
outstanding Indenture Securities of all series so directly
affected, considered as one class, will be required; and
provided, further, that if the Indenture Securities of any series
have been issued in more than one tranche and if the proposed
supplemental indenture directly affects the rights of the holders
of one or more, but less than all, of such tranches, then the
consent only of the holders of a majority in aggregate principal
amount of the outstanding Indenture Securities of all tranches so
directly affected, considered as one class, will be required; and
provided, further, that no such amendment or modification may
(a) change the Stated Maturity of the principal of, or any
installment of principal of or interest on, any Indenture
Security other than pursuant to the terms thereof, or reduce the
principal amount thereof or the rate of interest thereon (or the
amount of any installment of interest thereon) or change the
method of calculating such rate or reduce any premium payable
upon the redemption thereof, or reduce the amount of the
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principal of any Discount Security that would be due and payable
upon a declaration of acceleration of Maturity or change the coin
or currency (or other property) in which any Indenture Security
or any premium or the interest thereon is payable, or impair the
right to institute suit for the enforcement of any such payment
on or after the Stated Maturity of any Indenture Security (or, in
the case of redemption, on or after the redemption date) without,
in any such case, the consent of the holder of such Indenture
Security, (b) reduce the percentage in principal amount of the
outstanding Indenture Securities of any series, or any tranche
thereof, the consent of the holders of which is required for any
such supplemental indenture, or the consent of the holders of
which is required for any waiver of compliance with any provision
of the Indenture or of any default thereunder and its
consequences, or reduce the requirements for quorum or voting,
without, in any such case, the consent of the holder of each
outstanding Indenture Security of such series or tranche, or
(c) modify certain of the provisions of the Indenture relating to
supplemental indentures, waivers of certain covenants and waivers
of past defaults with respect to the Indenture Securities of any
series, or any tranche thereof, without the consent of the holder
of each outstanding Indenture Security of such series or tranche.
A supplemental indenture which changes or eliminates any
covenant or other provision of the Indenture which has expressly
been included solely for the benefit of the holders of, or which
is to remain in effect only so long as there shall be
outstanding, Indenture Securities of one or more specified
series, or one or more tranches thereof, or modifies the rights
of the holders of Indenture Securities of such series or tranches
with respect to such covenant or other provision, will be deemed
not to affect the rights under the Indenture of the holders of
the Indenture Securities of any other series or tranche.
If the supplemental indenture or other document establishing
any series or tranche of Indenture Securities so provides, and as
specified in the applicable Prospectus Supplement and/or Pricing
Supplement, the Holders of such Indenture Securities will be
deemed to have consented, by virtue of their purchase of such
Indenture Securities, to a supplemental indenture containing
the additions, changes or eliminations to or from the Indenture
which are specified in such supplemental indenture or other
document, no Act of such Holders will be required to evidence
such consent and such consent may be counted in the determination
of whether the Holders of the requisite principal amount of
Indenture Securities have consented to such supplemental indenture.
EVENTS OF DEFAULT
The Indenture provides that any one or more of the following
described events with respect to a series of Indenture Securities
that has occurred and is continuing constitutes an "Event of
Default" with respect to such series of Indenture Securities:
(a) failure for 60 days to pay any interest on such series
of Indenture Securities, when due and payable; provided,
however, that no such failure shall constitute an Event of
Default if the Company shall have made a valid extension of
the interest payment period with respect to such series of
Indenture Securities if so provided with respect to such
series; or
(b) failure to pay any principal or premium, if any, on
such series of Indenture Securities within 3 business days
after its maturity; provided, however, that no such failure
shall constitute an Event of Default if the Company shall have
made a valid extension of the maturity of such series of
Indenture Securities, if so provided with respect to such
series; or
(c) failure to perform, or breach of, any covenant or
warranty of the Company contained in the Indenture for 90 days
after written notice to the Company from the Trustee or to the
Company and the Trustee by the holders of at least 25% in
principal amount of such series of outstanding Indenture
Securities as provided in the Indenture unless the Trustee, or
the Trustee and the holders of a principal amount of
Securities of such series not less than the principal amount
of Indenture Securities the holders of which gave such notice,
as the case may be, agree in writing to an extension of such
period prior to its expiration; provided, however, that the
Trustee, or the Trustee and the holders of such principal
amount of Indenture Securities of such series, as the case may
be, will be deemed to have agreed to an extension of such
period if corrective action is initiated by the Company within
such period and is being diligently pursued; or
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(d) default under any bond, debenture, note or other
evidence of indebtedness of the Company for borrowed money
(including Indenture Securities of other series) or under any
mortgage, indenture, or other instrument to evidence any
indebtedness of the Company for borrowed money, which default
(1) shall constitute a failure to make any payment in excess
of $5,000,000 of the principal of, or interest on, such
indebtedness or (2) shall have resulted in such indebtedness
in an amount in excess of $10,000,000 becoming or being
declared due and payable prior to the date it would otherwise
have become due and payable, without such payment having been
made, such indebtedness having been discharged, or such
acceleration having been rescinded or annulled, within a
period of 90 days after written notice to the Company by the
Trustee or to the Company and the Trustee by the holders of at
least 25% in principal amount of the Securities of such series
outstanding under the Indenture, as provided in the Indenture;
or
(e) certain events in bankruptcy, insolvency or
reorganization of the Company.
REMEDIES
If an Event of Default applicable to the Indenture Securities
of any series occurs and is continuing, then either the Trustee
or the holders of not less than 33% in aggregate principal amount
of the outstanding Indenture Securities of such series may
declare the principal of all of the Indenture Securities of such
series and interest accrued thereon to be due and payable
immediately by written notice to the Company (and to the Trustee
if given by the holders of Indenture Securities); provided,
however, that if an Event of Default occurs and is continuing
with respect to more than one series of Indenture Securities, the
Trustee or the holders of not less than 33% in aggregate
principal amount of the outstanding Indenture Securities of all
such series, considered as one class, may make such declaration
of acceleration and not the holders of the Indenture Securities
of any one such series.
At any time after such a declaration of acceleration with
respect to the Indenture Securities of any series has been made,
but before a judgment or decree for payment of the money due has
been obtained, such declaration and its consequences will,
without further act, be deemed to have been rescinded and
annulled, if
(a) the Company has paid or deposited with the Trustee a
sum sufficient to pay
(1) all overdue interest, if any, on all Indenture
Securities of such series;
(2) the principal of and premium, if any, on any
Indenture Securities of such series which have become due
otherwise than by such declaration of acceleration and
interest thereon at the rate or rates prescribed therefor in
such Indenture Securities;
(3) interest upon overdue interest at the rate or rates
prescribed therefor in such Indenture Securities, to the
extent that payment of such interest is lawful; and
(4) all amounts due to the Trustee under the Indenture;
and
(b) all Events of Default with respect to Indenture
Securities of such series, other than the non-payment of the
principal of the Indenture Securities of such series which has
become due solely by such declaration of acceleration, have
been cured or waived as provided in the Indenture.
9
If an Event of Default with respect to the Indenture
Securities of any series occurs and is continuing, the holders of
a majority in principal amount of the outstanding Indenture
Securities of such series will have the right to direct the time,
method and place of conducting any proceedings for any remedy
available to the Trustee or exercising any trust or power
conferred on the Trustee; provided, however, that if an Event of
Default occurs and is continuing with respect to more than one
series of Indenture Securities, the holders of a majority in
aggregate principal amount of the outstanding Indenture
Securities of all such series, considered as one class, will have
the right to make such direction, and not the holders of the
Indenture Securities of any one of such series; and provided,
further, that (a) such direction does not conflict with any
rule of law or with the Indenture, and could not involve the
Trustee in personal liability in circumstances where indemnity
would not, in the Trustee's sole discretion, be adequate and
(b) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
The Indenture provides that no holder of any Indenture
Security will have any right to institute any proceeding,
judicial or otherwise, with respect to the Indenture or for the
appointment of a receiver or for any other remedy thereunder
unless (a) such holder has previously given to the Trustee
written notice of a continuing Event of Default with respect to
the Indenture Securities of any one or more series; (b) the
holders of a majority in aggregate principal amount of the
outstanding Indenture Securities of all series in respect of
which such Event of Default has occurred, considered as one
class, have made written request to the Trustee to institute
proceedings in respect of such Event of Default and have offered
the Trustee reasonable indemnity against costs and liabilities to
be incurred in complying with such request; and (c) for 60 days
after receipt of such notice, the Trustee has failed to institute
any such proceeding and no direction inconsistent with such
request has been given to the Trustee during such 60 day period
by the holders of a majority in aggregate principal amount of
Indenture Securities then outstanding. Furthermore, no holder of
Indenture Securities of any series will be entitled to institute
any such action if and to the extent that such action would
disturb or prejudice the rights of other holders of Indenture
Securities of such series. Notwithstanding that the right of a
holder to institute a proceeding with respect to the Indenture is
subject to certain conditions precedent, each holder of an
Indenture Security will have the right, which is absolute and
unconditional, to receive payment of the principal of and
premium, if any, and interest, if any, on such Indenture Security
when due and to institute suit for the enforcement of any such
payment, and such rights may not be impaired or affected without
the consent of such holder. The Indenture provides that the
Trustee give the holders notice of any default under the
Indenture to the extent required by the Trust Indenture Act,
unless such default shall have been cured or waived, except that
no such notice to holders of a default of the character described
in clause (c) under "-- Events of Default" may be given until at
least 75 days after the occurrence thereof. For purposes of the
preceding sentence, the term "default" means any event which is,
or after notice or lapse of time, or both, would become, an Event
of Default. The Trust Indenture Act currently permits the
Trustee to withhold notices of default (except for certain
payment defaults) if the Trustee in good faith determines the
withholding of such notice to be in the interests of the holders.
The Company is required to file annually with the Trustee a
certificate as to whether or not the Company is in compliance
with all the conditions and covenants applicable to it under the
Indenture.
CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS
The Indenture provides that the Company shall not consolidate
with or merge into any other Person, or convey or otherwise
transfer, or lease, all of its properties, as or substantially as
an entirety, to any Person, unless the Person formed by such
consolidation or into which the Company is merged or the Person
which acquires by conveyance or other transfer, or which leases
(for a term extending beyond the last Stated Maturity of the
10
Indenture Securities then outstanding), all of the properties of
the Company, as or substantially as an entirety, shall be a
Person organized and existing under the laws of the United
States, any State or Territory thereof or the District of
Columbia or under the laws of Canada or any Province thereof and
shall expressly assume the due and punctual payment of the
principal of and premium, if any, and interest, if any, on all
the Indenture Securities then outstanding and the performance and
observance of every covenant and condition of the Indenture to be
performed or observed by the Company. In the case of the
conveyance or other transfer, or lease, of all of the properties
of the Company, as or substantially as an entirety, to any person
as contemplated above, the Company would be released and
discharged from all obligations under the Indenture and on all
Indenture Securities then outstanding unless the Company elects
to waive such release and discharge. Upon any such consolidation
or merger or any such conveyance, transfer or lease of properties
of the Company, the successor, transferee or lessee shall succeed
to, and be substituted for, and may exercise every power and
right of, the Company under the Indenture. For purposes of the
Indenture, the conveyance, other transfer, or lease by the
Company of all of its facilities (a) for the generation of
electric energy, (b) for the transmission of electric energy or
(c) for the distribution of electric energy and/or natural gas,
in each case considered alone, or all of its facilities described
in clauses (a) and (b), considered together, or all of its
facilities described in clauses (b) and (c), considered together,
shall in no event be deemed to constitute a conveyance or other
transfer of all the properties of the Company, as or
substantially as an entirety, unless, immediately following such
conveyance, transfer or lease, the Company shall own no unleased
properties in the other such categories of property not so
conveyed or otherwise transferred or leased.
If the Company shall convey or otherwise transfer any part of
its properties which does not constitute the entirety, or
substantially the entirety, thereof to another Person meeting the
requirements set forth in the preceding paragraph, and if
(a) such transferee shall expressly assume the due and punctual
payment of the principal of and premium, if any, and interest, if
any, on all Indenture Securities then outstanding and the
performance and observance of every covenant and condition of the
Indenture to be performed or observed by the Company, and
(b) there shall be delivered to the Trustee an independent
expert's certificate (i) describing the property so conveyed or
transferred and identifying the same as facilities for the
generation, transmission or distribution of electric energy or
for the storage, transportation or distribution of natural gas
and (ii) stating that the aggregate principal amount of the
Indenture Securities then outstanding does not exceed 70% of the
fair value of such property, then the Company shall be released
and discharged from all obligations and covenants under the
Indenture and on all Indenture Securities then outstanding unless
the Company elects to waive such release and discharge. In such
event, the transferee shall succeed to, and be substituted for,
and may exercise every right and power of, the Company under the
Indenture.
SATISFACTION AND DISCHARGE
Any Indenture Securities, or any portion of the principal
amount thereof, will be deemed to have been paid for purposes of
the Indenture and, at the Company's election, the entire
indebtedness of the Company in respect thereof will be deemed to
have been satisfied and discharged, if there shall have been
irrevocably deposited with the Trustee or any Paying Agent (other
than the Company), in trust: (a) money in an amount which will be
sufficient, or (b) in the case of a deposit made prior to the
maturity of such Indenture Securities, Eligible Obligations,
which do not contain provisions permitting the redemption or
other prepayment thereof at the option of the issuer thereof, the
principal of and the interest on which when due, without any
regard to reinvestment thereof, will provide moneys which,
together with the money, if any, deposited with or held by the
Trustee or such Paying Agent, will be sufficient, or (c) a
combination of (a) and (b) which will be sufficient, to pay when
due the principal of and premium, if any, and interest, if any,
11
due and to become due on such Indenture Securities. For this
purpose, Eligible Obligations include direct obligations of, or
obligations unconditionally guaranteed by, the United States
entitled to the benefit of the full faith and credit thereof and
certificates, depositary receipts or other instruments which
evidence a direct ownership interest in such obligations or in
any specific interest or principal payments due in respect
thereof and such other obligations or instruments as shall be
specified in an accompanying Prospectus Supplement.
The Indenture will be deemed to have been satisfied and
discharged when no Indenture Securities remain outstanding
thereunder and the Company has paid or caused to be paid all
other sums payable by the Company under the Indenture.
INFORMATION CONCERNING THE TRUSTEE
The Trustee will have, and will be subject to, all the duties
and responsibilities specified with respect to an indenture
trustee under the Trust Indenture Act. Subject to such
provisions, the Trustee will be under no obligation to exercise
any of the powers vested in it by the Indenture at the request of
any holder of Indenture Securities, unless offered reasonable
indemnity by such holder against the costs, expenses and
liabilities which might be incurred thereby. The Trustee will
not be required to expend or risk its own funds or otherwise
incur personal financial liability in the performance of its
duties if the Trustee reasonably believes that repayment or
adequate indemnity is not reasonably assured to it.
The Trustee may resign at any time with respect to the
Indenture Securities of one or more series by giving written
notice thereof to the Company or may be removed at any time with
respect to the Indenture Securities of one or more series by Act
of the Holders of a majority in principal amount of the
outstanding Indenture Securities of such series delivered to the
Trustee and the Company. No resignation or removal of the
Trustee and no appointment of a successor trustee will become
effective until the acceptance of appointment by a successor
trustee in accordance with the requirements of the Indenture. So
long as no Event of Default or event which, after notice or lapse
of time, or both, would become an Event of Default has occurred
and is continuing, if the Company has delivered to the Trustee
with respect to one or more series a resolution of its Board of
Directors appointing a successor trustee with respect to that or
those series and such successor has accepted such appointment in
accordance with the terms of the Indenture, the Trustee with
respect to that or those series will be deemed to have resigned
and the successor will be deemed to have been appointed as
trustee in accordance with the Indenture.
EVIDENCE TO BE FURNISHED TO THE TRUSTEE
Compliance with the Indenture provisions is evidenced by
written statements of Company officers or persons selected or
paid by the Company. In certain cases, opinions of counsel and
certifications of an engineer, appraiser or other expert (who in
some cases must be independent) must be furnished. In addition,
the Indenture requires that the Company give the Trustee, not
less than annually, a brief statement as to the Company's
compliance with the conditions and covenants under the Indenture.
GOVERNING LAW
The Indenture and the Indenture Securities will be governed by
and construed in accordance with the laws of the State of New
York, except to the extent that the Trust Indenture of 1939, as
amended, shall be applicable.
12
PLAN OF DISTRIBUTION
The Company may sell the Debt Securities in any of four ways:
(i) directly to a limited number of institutional purchasers or
to a single purchaser, (ii) through agents, (iii) through
underwriters or (iv) through dealers. The applicable Prospectus
Supplement relating to each series of Debt Securities will set
forth the terms of the offering of such Debt Securities,
including the name or names of any such agents, underwriters or
dealers, the purchase price of such Debt Securities and the net
proceeds to the Company from such sale, any underwriting
discounts and other items constituting underwriters'
compensation, the initial public offering price and any discounts
or concessions allowed or reallowed or paid to dealers. Any
initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers may be changed from time
to time.
If underwriters are used in any sale of Debt Securities, such
Debt Securities will be acquired by such underwriters for their
own account and may be resold from time to time in one or more
transactions, including negotiated transactions, at a fixed
public offering price or at varying prices determined at the time
of sale. Unless otherwise set forth in the Prospectus Supplement
relating to a series of Debt Securities, the obligations of any
underwriter or underwriters to purchase such Debt Securities will
be subject to certain conditions precedent, and such underwriter
or underwriters will be obligated to purchase all of such Debt
Securities if any are purchased, except that, in certain cases
involving a default by one or more underwriters, less than all of
such Debt Securities may be purchased.
If an agent of the Company is used in any sale of a series of
Debt Securities, any commissions payable by the Company to such
agent will be set forth in the applicable Prospectus Supplement
relating to such Debt Securities. Unless otherwise indicated in
the applicable Prospectus Supplement, any such agent will be
acting on a best efforts basis for the period of its appointment.
Any underwriters, dealers or agents participating in the
distribution of the Debt Securities may be deemed to be
underwriters, and any discounts or commissions received by them
on the sale or resale of Debt Securities may be deemed to be
underwriting discounts and commissions, under the Securities Act.
Agents, underwriters and dealers may be entitled under agreements
entered into with the Company to indemnification by the Company
against certain liabilities, including liabilities under the
Securities Act.
Unless otherwise provided in the applicable Prospectus
Supplement relating to a series of Debt Securities, the Company
does not intend to apply for the listing of the Notes on a
national securities exchange, but has been advised by the agents
that the agents intend to make a market in the Notes, as
permitted by applicable laws and regulations. The agents are not
obligated to do so, however, and the agents may discontinue
making a market at any time without notice. No assurance can be
given as to the liquidity of any trading market for the Notes.
The agents and/or certain of their affiliates may engage in
transactions with and perform services for the Company and
certain of its affiliates in the ordinary course of business.
LEGAL MATTERS
Certain matters of New York law and of federal securities laws
relating to the validity of the Debt Securities and certain
matters relating thereto will be passed upon for the Company by
Reid & Priest LLP, New York, New York, counsel to the Company.
Certain matters of Washington corporate law and of public utility
regulatory approvals under Washington, Idaho, Montana, Oregon and
13
California law relating to the authorization of the Debt
Securities will be passed upon for the Company by Paine, Hamblen,
Coffin, Brooke & Miller LLP, Spokane, Washington, general counsel
for the Company. The validity of the Debt Securities will be
passed upon for the underwriters by Sullivan & Cromwell, New
York, New York. In giving their opinions Reid & Priest LLP and
Sullivan & Cromwell may assume the conclusions of Washington,
California, Idaho, Montana and Oregon law set forth in the
opinion of Paine, Hamblen, Coffin, Brooke & Miller LLP.
EXPERTS
The financial statements and the related financial statement
schedules incorporated in this Prospectus by reference from the
Company's Latest Annual Report on Form 10-K have been audited by
Deloitte & Touche LLP, independent auditors, as stated in their
report, which is incorporated herein by reference, and have been
so incorporated in reliance upon the report of such firm given
upon their authority as experts in accounting and auditing.
14
PART II
ITEM 16. EXHIBITS.
Reference is made to the Exhibit Index on p. II-3 hereof.
II-1
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, the Registrant certifies that it has reasonable grounds
to believe that it meets all of the requirements for filing on
Form S-3 and has duly caused this Amendment No. 1 to the
Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Spokane
and State of Washington on the 20th day of April, 1998.
THE WASHINGTON WATER POWER COMPANY
By /s/ Paul A. Redmond
---------------------------------
Paul A. Redmond
Chairman of the Board
and Chief Executive Officer
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS
AMENDED, THIS REGISTRATION STATEMENT HAS BEEN SIGNED BY THE
FOLLOWING PERSONS IN THE CAPACITIES AND ON THE DATE INDICATED.
Signature Title Date
--------- ----- ----
/s/ Paul A. Redmond Principal April 20, 1998
-------------------------- Executive
Paul A. Redmond Officer
(Chairman of the Board and Director
and Chief Executive Officer)
/s/ J.E. Eliassen Principal April 20, 1998
---------------------------- Financial and
J. E. Eliassen (Senior Vice Accounting
President, Chief Financial Officer
Officer and Treasurer)
/s/ W. Lester Bryan Director April 20, 1998
----------------------------
W. Lester Bryan (President
and Chief Operating Officer)
David A. Clark, Duane B. Hagadone,
Sarah M.R. Jewell, John F. Kelly, Directors
Eugene W. Meyer, Bobby Schmidt,
Larry A. Stanley, R. John Taylor
By /s/ J.E. Eliassen
----------------------------
J.E. Eliassen (Attorney-in-Fact)
II-2
EXHIBIT INDEX
EXHIBIT DESCRIPTION
------- -----------
*1(a) Form of Underwriting Agreement for offering of Debt
Securities.
1(b) Form of Distribution Agreement for offering of Medium-
Term Notes.
4(a) Form of Indenture between The Washington Water Power
Company and The Chase Manhattan Bank, as Trustee.
4(b) Form of Officer's Certificate to be used in connection
with an underwritten public offering of Debt
Securities.
4(c) Form of Officer's Certificate to be used in connection
with the issuance of Medium-Term Notes.
5(a)(1) Opinion and Consent of Paine, Hamblen, Coffin, Brooke &
Miller LLP.
5(a)(2) Opinion and Consent of Paine, Hamblen, Coffin, Brooke &
Miller LLP to be filed from time to time by post-
effective amendment.
5(b)(1) Opinion and Consent of Reid & Priest LLP.
5(b)(2) Opinion and Consent of Reid & Priest LLP to be filed
from time to time by post-effective amendment.
23(a) Consent of Deloitte & Touche LLP.
23(b) Consents of Paine, Hamblen, Coffin, Brooke & Miller LLP
and Reid & Priest LLP are contained in Exhibits 5(a)(1)
and 5(b)(1), respectively.
25(a) Statement of Eligibility under the Trust Indenture Act
of 1939, as amended, of The Chase Manhattan Bank, as
Trustee under the Indenture.
--------
* To be filed subsequently as an exhibit to a Current Report
on Form 8-K.
II-3
The Washington Water Power Company
$250,000,000
Medium-Term Notes, Series C
Distribution Agreement
----------------------
, 1998
------
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Merrill Lynch, Pierce, Fenner & Smith Incorporated
World Financial Center
250 Vesey Street
New York, New York 10281
Salomon Brothers Inc
7 World Trade Center
New York, New York 10048
Ladies and Gentlemen:
The Washington Water Power Company, a Washington
corporation (the "Company"), proposes to issue and sell from time
to time its Medium-Term Notes, Series C (the "Securities") in an
aggregate principal amount up to $250,000,000 and agrees with
each of you (individually, an "Agent", and collectively, the
"Agents") as set forth in this Agreement.
Subject to the terms and conditions stated herein and
to the reservation by the Company of the right to sell Securities
directly on its own behalf, the Company hereby (i) appoints each
Agent as an agent of the Company for the purpose of soliciting
and receiving offers to purchase Securities from the Company
pursuant to Section 2(a) hereof and (ii) agrees that, except as
otherwise contemplated herein, whenever it determines to sell
Securities directly to any Agent as principal, it will enter into
a separate agreement, substantially in the form of Annex I hereto
(each a "Terms Agreement"), relating to such sale in accordance
with Section 2(b) hereof.
The Securities will be issued as a series under the
Company's Indenture, dated as of , 1998, to The Chase
------- --
Manhattan Bank, as trustee (the "Trustee") as it will be
supplemented by an Officer's Certificate dated , 1998
------ --
(said Indenture, as so supplemented and as it may be amended and
further supplemented being hereinafter referred to as the
"Indenture"). The Securities shall have the maturity ranges,
interest rates, if any, redemption provisions and other terms set
forth in the Prospectus referred to below as it may be amended or
supplemented from time to time. The Securities will be issued,
and the terms and rights thereof established, from time to time
by the Company in accordance with the Indenture.
1. The Company represents and warrants to, and agrees
with, each Agent that:
(a) The Company has carefully prepared in
conformity with the requirements of the Securities Act of
1933, as amended (the "Act"), and the applicable rules and
regulations of the Securities and Exchange Commission (the
"Commission") (i) a registration statement on Form S-3, as
amended by Amendment No. 1 to the Registration Statement
(File No. 333-39551) (the "Registration Statement") for the
registration of $250,000,000 in aggregate principal amount
of its Debt Securities. The Registration Statement has
become effective and no stop order suspending the
effectiveness of the Registration Statement has been issued
and no proceeding for that purpose has been initiated or
threatened by the Commission. No Debt Securities registered
under the Registration Statement have been issued. A
prospectus supplement setting forth the terms of the
Securities and of their sale and distribution (the
"Prospectus Supplement") has been or will be so prepared and
will be filed pursuant to Rule 424 under the Act. The
Registration Statement (including exhibits, but excluding
the Statement of Eligibility on Form T-1) in the form in
which it became effective, and as amended to the date
hereof, is herein referred to as the "Registration
Statement"; the prospectus included as a part of the
Registration Statement, as such prospectus may have been
amended to the date hereof, is hereinafter referred to as
the "Basic Prospectus"; and the Basic Prospectus, as
supplemented by the Prospectus Supplement, is herein
referred to as the "Prospectus"; provided, however, that (i)
any reference herein to the terms "Registration Statement",
"Basic Prospectus" or "Prospectus" shall be deemed to refer
to and include the documents incorporated therein by
reference pursuant to Item 12 of Form S-3 under the Act,
(ii) any reference to any amendment or supplement to the
Prospectus shall be deemed to refer to and include any
documents filed after the date of the Prospectus pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and so
incorporated by reference, (iii) any reference to the
Prospectus as amended or supplemented shall be deemed to
refer to and include the Prospectus as amended or
supplemented (including by any supplement to the Prospectus
that sets forth only the terms of a particular tranche of
the Securities (a "Pricing Supplement") filed in accordance
with Section 4(a) hereof) in relation to the Securities sold
pursuant to this Agreement, in the form filed with the
Commission pursuant to Rule 424(b) under the Act and in
accordance with Section 4(a) hereof, including any documents
incorporated by reference therein as of the date of such
filing) and (iv) no prospectus supplement to the Basic
Prospectus which relates to securities of the Company other
than the Securities shall be deemed to be a part of the
Basic Prospectus or the Prospectus;
(b) The Registration Statement when it became
effective complied, and the Prospectus and any amendments or
supplements thereto will comply, in all material respects
with the applicable provisions of the Act and the Trust
Indenture Act of 1939, as amended (the "Trust Indenture
Act"), and the applicable rules and regulations of the
Commission thereunder and do not and will not, as of the
applicable effective date in the case of the Registration
Statement and any amendment thereto, and as of the
applicable date referred to in Section 4(g) hereof and as of
the applicable filing date in the case of the Prospectus and
any supplement thereto, contain an untrue statement of a
material fact or omit to state a material fact required to
be stated therein or necessary to make the statements
therein not misleading; provided, however, that the Company
makes no representations or warranties as to information
contained in or omitted from any such document in reliance
upon and in conformity with information furnished in writing
to the Company by any Agent specifically for use in the
preparation thereof;
(c) The documents incorporated by reference in
the Prospectus, when they became effective or were filed
with the Commission, as the case may be, complied in all
material respects with the requirements of the Act or the
Exchange Act, and the applicable rules and regulations of
the Commission thereunder, and none of such documents
included an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of
the circumstances under which they were made, not
misleading; and any further documents so filed and
incorporated by reference in the Prospectus, or any
amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case may
be, will comply in all material respects with the applicable
requirements of the Act or the Exchange Act, and the
applicable rules and regulations of the Commission
thereunder, and will not contain an untrue statement of a
material fact or omit to state a material fact required to
be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that the
Company makes no representations or warranties as to
information contained in or omitted from any such document
in reliance upon and in conformity with information
furnished in writing to the Company by any Agent
specifically for use in the preparation thereof;
(d) Except as set forth in or contemplated by the
Prospectus as amended or supplemented, (i) since the date as
of which information is given in the Prospectus as amended
or supplemented there has not been any material adverse
change in the condition of the Company and its subsidiaries
as a whole, financial or otherwise, (ii) since the date of
the Prospectus as amended or supplemented there has not been
any transaction entered into by the Company or any
subsidiary thereof which is material to the Company and its
subsidiaries as a whole other than transactions in the
ordinary course of business and (iii) neither the Company
nor any of its subsidiaries has any contingent obligation
which is material to the Company and its subsidiaries as a
whole;
(e) The Securities have been duly authorized, and
when issued and delivered pursuant to this Agreement and any
Terms Agreement, and duly authenticated by the Trustee
pursuant to the Indenture, will have been duly executed,
authenticated, issued and delivered and will constitute
valid and legally binding obligations of the Company
entitled to the benefits provided by the Indenture; the
Indenture has been duly authorized and qualified under the
Trust Indenture Act and constitutes a valid and legally
binding instrument; the Indenture is, and the Securities,
when authenticated, issued and delivered as aforesaid, will
be, enforceable in accordance with their respective terms,
except to the extent that enforcement thereof may be limited
by any applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or other laws
affecting creditors' rights generally, by general principles
of equity (whether asserted in an action in equity or at
law) and by rules of law governing specific performance,
injunctive relief, foreclosure, receivership and other
equitable remedies; and the Indenture and the Securities of
any particular tranche will conform in all material respects
to the descriptions thereof contained in the Prospectus as
amended or supplemented to relate to the Securities of such
tranche;
(f) The issue and sale of the Securities, the
compliance by the Company with all of the provisions of the
Securities, the Indenture, this Agreement and any Terms
Agreement, and the consummation by the Company of the
transactions herein and therein contemplated will not result
in a breach or violation of any of the terms or provisions
of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or
instrument to which the Company is a party or by which the
Company is bound or to which any of the property or assets
of the Company is subject, nor will such action result in
any violation of the provisions of any statute or the
Restated Articles of Incorporation, as amended, or the
Bylaws, as amended, of the Company or, to the best of the
Company's knowledge, information or belief, any order, rule
or regulation of any court or any federal or state
regulatory authority or other governmental agency or body
having jurisdiction over the Company or any of its
properties; and no consent, approval, authorization, order,
registration or qualification of or with any court or
governmental agency or body is required for the solicitation
of offers to purchase Securities and the issue and sale of
the Securities or the consummation by the Company of the
other transactions contemplated by this Agreement, any Terms
Agreement or the Indenture, except such as have been, or
will have been prior to the Commencement Date (as defined in
Section 3 hereof), obtained under the Act or the Trust
Indenture Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under
state securities or Blue Sky laws in connection with the
solicitation by such Agent of offers to purchase Securities
from the Company and with purchases of Securities by such
Agent as principal, as the case may be, and such consents,
approvals, authorizations, filings or registrations as may
be required by the Washington Utilities and Transportation
Commission, the California Public Utilities Commission, the
Idaho Public Utilities Commission and the Public Utility
Commission of Oregon, in each case in the manner
contemplated hereby;
(g) Except as set forth in or contemplated by the
Prospectus, as amended or supplemented, there are no legal
or governmental proceedings pending to which the Company or
any of its subsidiaries is a party or to which any property
of the Company or any of its subsidiaries is subject, which,
if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a
material adverse effect on the consolidated financial
position, stockholders' equity or results of operations of
the Company and its subsidiaries, and, to the best of the
Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by
others; and
(h) Immediately after any sale of Securities by
the Company hereunder or under any Terms Agreement, the
aggregate amount of Securities which shall have been issued
and sold by the Company hereunder or under any Terms
Agreement that shall have been issued and sold pursuant to
the Registration Statement will not exceed the amount of
Securities registered under the Registration Statement.
2. (a) On the basis of the representations and
warranties, and subject to the terms and conditions herein set
forth, each of the Agents hereby severally and not jointly
agrees, as agent of the Company, to use its reasonable best
efforts to solicit and receive offers to purchase the Securities
from the Company upon the terms and conditions set forth in the
Prospectus as amended or supplemented from time to time. So long
as this Agreement shall remain in effect with respect to any
Agent, the Company shall not, without the consent of such Agent,
which consent shall not unreasonably be withheld, solicit or
accept offers to purchase, or sell, any debt securities with a
maturity at the time of original issuance of nine months to 40
years except pursuant to this Agreement or any Terms Agreement,
or except pursuant to a private placement not constituting a
public offering under the Act or except in connection with a firm
commitment underwriting pursuant to an underwriting agreement
that does not provide for a continuous offering of medium-term
debt securities. However, the Company reserves the right to
sell, and may solicit and accept offers to purchase, Securities
directly on its own behalf, and, in the case of any such sale not
resulting from a solicitation made by any Agent, no commission
will be payable with respect to such sale. These provisions
shall not limit Section 4(f) hereof or any similar provisions
included in any Terms Agreement.
Procedural details relating to the issue and delivery
of Securities, the solicitation of offers to purchase Securities
and the payment in each case therefor shall be as set forth in
the Administrative Procedure attached hereto as Annex II as it
may be amended from time to time by written agreement between the
Agents and the Company (the "Administrative Procedure"). The
provisions of the Administrative Procedure shall apply to all
transactions contemplated hereunder other than those made
pursuant to a Terms Agreement. Each Agent and the Company agree
to perform the respective duties and obligations specifically
provided to be performed by each of them in the Administrative
Procedure. The Company will furnish to the Trustee a copy of the
Administrative Procedure as from time to time in effect.
The Company reserves the right, in its sole discretion,
to instruct the Agents to suspend at any time after the
Commencement Date (as defined in Section 3), for any period of
time or permanently, the solicitation of offers to purchase the
Securities. As soon as practicable, but in any event not later
than one business day in New York City, after receipt of notice
from the Company, the Agents will suspend solicitation of offers
to purchase Securities from the Company until such time as the
Company has advised the Agents that such solicitation may be
resumed.
The Company agrees to pay each Agent a commission, at
the time of settlement of any sale of a Security by the Company
as a result of a solicitation made by such Agent, in an amount
equal to the following applicable percentage of the principal
amount of such Security sold:
Commission
(percentage of
aggregate
principal amount
Range of Maturities of Securities sold)
------------------- -------------------
From 9 months to less than 1 year 0.125%
From 1 year to less than 18 months 0.150%
From 18 months to less than 2 years 0.200%
From 2 years to less than 3 years 0.250%
From 3 years to less than 4 years 0.350%
From 4 years to less than 5 years 0.450%
From 5 years to less than 6 years 0.500%
From 6 years to less than 7 years 0.550%
From 7 years to less than 10 years 0.600%
From 10 years to less than 15 years 0.625%
From 15 years to less than 20 years 0.700%
From 20 years to less than 30 years 0.750%
From 30 years to 40 years 0.875%
(b) Each sale of Securities to any Agent as principal
shall be made in accordance with the terms of this Agreement and
(unless the Company and such Agent shall otherwise agree in
writing or orally) a Terms Agreement which will provide for the
sale of such Securities to, and the purchase thereof by, such
Agent; it being understood that (unless the Company and such
Agent shall otherwise agree in writing) any such oral agreement
relating to the sale of Securities to such Agent as principal (i)
shall be deemed to incorporate all the terms and conditions set
forth in the form of Terms Agreement attached hereto as Annex I
and (ii) shall be promptly confirmed in writing. A Terms
Agreement may also specify certain provisions relating to the
reoffering of such Securities by such Agent. The commitment of
any Agent to purchase Securities as principal, whether pursuant
to any Terms Agreement or otherwise, shall be deemed to have been
made on the basis of the representations and warranties of the
Company herein contained and shall be subject to the terms and
conditions herein set forth. Each Terms Agreement shall specify
the principal amount of Securities to be purchased by any Agent
pursuant thereto, the price to be paid to the Company for such
Securities, any provisions relating to rights of, and default by,
underwriters acting together with such Agent in the reoffering of
the Securities and the time and date and place of delivery of and
payment for such Securities. Such Terms Agreement shall also
specify any requirements for opinions of counsel, accountants'
letters and officers' certificates pursuant to Section 4 hereof.
For each sale of Securities to an Agent as principal
that is not made pursuant to a Terms Agreement, the procedural
details relating to the issue and delivery of such Securities and
payment therefor shall be as set forth in the Administrative
Procedure and the Company agrees to pay such Agent a commission
(or grant an equivalent discount) as provided in Section 2(a)
hereof and in accordance with the schedule set forth therein.
Each time and date of delivery of and payment for
Securities to be purchased by an Agent as principal, whether set
forth in a Terms Agreement or in accordance with the
Administrative Procedure, is referred to herein as a "Time of
Delivery."
3. The documents required to be delivered pursuant to
Section 6 hereof on the Commencement Date (as defined below)
shall be delivered to the Agents at the offices of Reid & Priest
LLP, 40 West 57th Street, New York, New York, at 11:00 a.m., New
York City time, on the date of this Agreement, which date and
time of such delivery may be postponed by agreement between the
Agents and the Company but in no event shall be later than the
day prior to the date on which solicitation of offers to purchase
Securities is commenced or on which any Terms Agreement is
executed by the parties thereto (such time and date being
referred to herein as the "Commencement Date").
4. The Company covenants and agrees with each Agent:
(a) (i) To make no amendment or supplement to the
Registration Statement or the Prospectus (A) prior to the
Commencement Date to which any Agent shall reasonably
disapprove by notice to the Company promptly after
reasonable notice thereof or (B) after the date of any Terms
Agreement or other agreement by an Agent to purchase
Securities as principal and prior to the related Time of
Delivery which shall be reasonably disapproved by notice to
the Company by any Agent party to such Terms Agreement or so
purchasing as principal promptly after reasonable notice
thereof; (ii) to prepare, with respect to any Securities to
be sold through or to such Agent pursuant to this Agreement,
a Pricing Supplement with respect to such Securities in a
form previously approved by such Agent and to file such
Pricing Supplement pursuant to Rule 424(b)(3) under the Act
not later than the close of business of the Commission on
the third business day following the date on which such
Pricing Supplement is first used; (iii) to make no amendment
or supplement to the Registration Statement or Prospectus,
other than any Pricing Supplement, at any time prior to
having afforded each Agent a reasonable opportunity to
review and comment thereon; (iv) to file in a timely manner
all reports and any definitive proxy or information
statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Exchange Act for so long as the delivery of a prospectus
is required in connection with the offering or sale of the
Securities, and during such period to advise such Agent,
promptly after the Company received notices thereof, of the
time when any amendment to the Registration Statement has
been filed or has become effective or any supplement to the
Prospectus or any amended Prospectus (other than any Pricing
Supplement that relates to Securities not purchased through
or by such Agent) has been filed with the Commission, of the
issuance by the Commission of any stop order or of any order
preventing or suspending the use of any prospectus relating
to the Securities, of the suspension of the qualification of
the Securities for offering or sale in any jurisdiction, of
the initiation or threatening of any proceeding for any such
purpose, or of any request by the Commission for the
amendment or supplement of the Registration Statement or
Prospectus or for additional information; (v) in the event
of the issuance of any such stop order or of any such order
preventing or suspending the use of any such prospectus or
suspending any such qualification, to use promptly every
reasonable effort to obtain its withdrawal; and (vi) to
notify the Agents promptly of any change in the rating
assigned by any nationally recognized statistical rating
organization to any debt securities of the Company
(including the Securities) of the Company, or the public
announcement by any nationally recognized statistical rating
organization that it has under surveillance or review, with
possible negative implications, its rating of the Securities
or any such debt securities, or the withdrawal by any
nationally recognized statistical rating organization of its
rating of the Securities or any such debt securities.
(b) Promptly from time to time to take such
action as such Agent may reasonably request to qualify the
Securities for offering and sale under the securities laws
of such jurisdictions as may be approved by the Company and
to comply with such laws so as to permit the continuance of
sales and dealings therein for as long as may be necessary
to complete the distribution or sale of the Securities;
provided, however, that in connection therewith the Company
shall not be required to qualify as a foreign corporation or
to file a general consent to service of process in any
jurisdiction, or to comply with any other requirement
reasonably deemed by the Company to be unduly burdensome;
(c) To furnish such Agent with copies of the
Registration Statement and each amendment thereto, and with
copies of the Prospectus as each time amended or
supplemented, other than any Pricing Supplement (except as
provided in the Administrative Procedure), in the form in
which it is filed with the Commission pursuant to Rule 424
under the Act, in such quantities as such Agent may
reasonably request from time to time, and with copies of the
documents incorporated by reference therein; and, if the
delivery of a prospectus is required at any time in
connection with the offering or sale of the Securities
(including Securities purchased from the Company by such
Agent as principal) and if at such time any event shall have
occurred as a result of which the Prospectus as then amended
or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary
in order to make the statements therein, in the light of the
circumstances under which they were made when such
Prospectus is delivered, not misleading, or, if for any
other reason it shall be necessary at such time to amend or
supplement the Prospectus or to file under the Exchange Act
any document incorporated by reference in the Prospectus in
order to comply with the Act, the Exchange Act or the Trust
Indenture Act, to notify such agent and request such Agent,
in its capacity as agent of the Company, to suspend
solicitation of offers to purchase Securities from the
Company (and, if so notified, such Agent shall cease such
solicitations as soon as practicable, but in any event not
later than one business day later); and if the Company shall
decide to amend or supplement the Registration Statement or
the Prospectus as then amended or supplemented, to so advise
such Agent promptly by telephone (with confirmation in
writing) and to prepare and cause to be filed promptly with
the Commission an amendment or supplement to the
Registration Statement or the Prospectus as then amended or
supplemented or to file any document under the Exchange Act
that will correct such statement or omission or effect such
compliance; provided, however, that, should such event
relate solely to activities of any Agent, then such Agent
shall assume the expense of preparing and furnishing any
such amendment or supplement; and provided, further, that if
at such time such Agent continues to own Securities
purchased from the Company by such Agent as principal or
such Agent is otherwise required to deliver a prospectus in
respect of transactions in the Securities, the Company shall
promptly prepare and file with the Commission such an
amendment or supplement. For the purposes of this
subsection (c), the Company shall be entitled to assume that
a Prospectus shall no longer be required to be delivered
under the Act from and after the date six months from the
date of the purchase thereof by an Agent as principal,
unless it shall have received notice from such Agent to the
contrary;
(d) To make generally available to its security-
holders as soon as practicable, but in any event not later
than eighteen months after (i) the effective date of the
Registration Statement, (ii) the effective date of each
post-effective amendment to the Registration Statement, and
(iii) the date of each filing by the Company with the
Commission of an Annual Report on Form 10-K that is
incorporated by reference in the Registration Statement, an
earning statement of the Company and its subsidiaries (which
need not be audited) complying with Section 11(a) of the Act
and the rules and regulations of the Commission thereunder
(including, at the option of the Company, Rule 158);
(e) For the period ending five years from the
date any Securities are sold by the Company pursuant to an
offer solicited by such Agent, to furnish to such Agent
copies of all reports or other communications (financial or
other) furnished to stockholders, and deliver to such Agent
(i) as soon as they are available, copies of any reports and
financial statements furnished to or filed with the
Commission or any national securities exchange on which any
class of securities of the Company is listed and (ii) such
additional information concerning the business and financial
condition of the Company as such Agent may from time to time
reasonably request (such financial statements to be on a
consolidated basis to the extent the accounts of the Company
and its subsidiaries are consolidated in reports furnished
to its stockholders generally or to the Commission);
(f) That, from the date of any Terms Agreement
with such Agent or other agreement by such Agent to purchase
Securities as principal and continuing to and including the
earlier of (i) the termination of the trading restrictions
for the Securities purchased thereunder, as notified to the
Company by such Agent and (ii) the related Time of Delivery,
it will not offer, sell, contract to sell or otherwise
dispose of any debt securities of the Company in a public
offering which both mature more than nine months after such
Time of Delivery and are substantially similar to the
Securities, without the prior written consent of such Agent;
(g) That each acceptance by the Company of an
offer to purchase Securities hereunder (including any
purchase by such Agent as principal not pursuant to a Terms
Agreement), and each execution and delivery by the Company
of a Terms Agreement with such Agent, shall be deemed to be
an affirmation to such Agent that the representations and
warranties of the Company contained in or made pursuant to
this Agreement are true and correct as of the date of such
acceptance or of such Terms Agreement, as the case may be,
as though made at and as of such date, and an undertaking
that such representations and warranties will be true and
correct as of the settlement date for the Securities
relating to such acceptance or as of the Time of Delivery
relating to such sale, as the case may be, as though made at
and as of such date (except that such representations and
warranties shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented
relating to such Securities);
(h) That reasonably in advance of each time the
Registration Statement or the Prospectus shall be amended or
supplemented (other than by a Pricing Supplement) and each
time a document filed under the Act or the Exchange Act is
incorporated by reference into the Prospectus, and each time
the Company sells Securities to such Agent as principal
pursuant to a Terms Agreement and such Terms Agreement
specifies the delivery of an opinion or opinions by Sullivan
& Cromwell, of New York, New York, counsel to the Agents, as
a condition to the purchase of Securities pursuant to such
Terms Agreement, the Company shall furnish to such counsel
such papers and information as they may reasonably request
to enable them to furnish to such Agent such opinion or
opinions referred to in Section 6(c) hereof;
(i) That each time the Registration Statement or
the Prospectus shall be amended or supplemented (other than
by a Pricing Supplement), each time a document filed under
the Act or the Exchange Act is incorporated by reference
into the Prospectus (except for a Current Report on Form 8-K
that is filed solely for the purpose of filing exhibits
pursuant to Item 601 of Regulation S-K, unless the Agent
shall otherwise reasonably request), and each time the
Company sells Securities to such Agent as principal pursuant
to a Terms Agreement and such Terms Agreement specifies the
delivery of an opinion under this Section 4(i) as a
condition to the purchase of Securities pursuant to such
Terms Agreement, the Company shall furnish or cause to be
furnished forthwith to such Agent a written opinion of
Paine, Hamblen, Coffin, Brooke & Miller LLP, of Spokane,
Washington, General Counsel for the Company, or other
counsel for the Company satisfactory to such Agent, dated
the date of such amendment, supplement, incorporation or
Time of Delivery relating to such sale, as the case may be,
in form satisfactory to such Agent, to the effect that such
Agent may rely on the opinion of such counsel referred to in
Section 6(d) hereof which was last furnished to such Agent
to the same extent as though it were dated the date of such
letter authorizing reliance (except that the statements in
such last opinion shall be deemed to relate to the
Registration Statement and the Prospectus as amended and
supplemented to such date) or, in lieu of such opinion, an
opinion of the same tenor as the opinion of such counsel
referred to in Section 6(d) hereof but modified to relate to
the Registration Statement and the Prospectus as amended and
supplemented to such date;
(j) That each time the Registration Statement or
the Prospectus shall be amended or supplemented (other than
by a Pricing Supplement), each time a document filed under
the Act or the Exchange Act is incorporated by reference
into the Prospectus (except for a Current Report on Form 8-K
that is filed solely for the purpose of filing exhibits
pursuant to Item 601 of Regulation S-K, unless any Agent
shall reasonably request), and each time the Company sells
Securities to such Agent as principal pursuant to a Terms
Agreement and such Terms Agreement specifies the delivery of
an opinion under this Section 4(j) as a condition to the
purchase of Securities pursuant to such Terms Agreement, the
Company shall furnish or cause to be furnished forthwith to
such Agent a written opinion of Reid & Priest LLP, of New
York, New York, counsel for the Company, or other counsel
for the Company satisfactory to such Agent, dated the date
of such amendment, supplement, incorporation or Time of
Delivery relating to such sale, as the case may be, in form
satisfactory to such Agent, to the effect that such Agent
may rely on the opinion of such counsel referred to in
Section 6(e) hereof which was last furnished to such Agent
to the same extent as though it were dated the date of such
letter authorizing reliance (except that the statements in
such last opinion shall be deemed to relate to the
Registration Statement and the Prospectus as amended and
supplemented to such date), or, in lieu of such opinion, an
opinion of the same tenor as the opinion of such counsel
referred to in Section 6(e) hereof but modified to relate to
the Registration Statement and the Prospectus as amended and
supplemented to such date;
(k) That each time the Registration Statement or
the Prospectus shall be amended or supplemented, other than
by a Pricing Supplement, and each time that a document filed
under the Act or the Exchange Act is incorporated by
reference into the Prospectus, in either case to set forth
financial information included in or derived from the
Company's consolidated financial statements or accounting
records, and each time the Company sells Securities to such
Agent as principal pursuant to a Terms Agreement and such
Terms Agreement specifies the delivery of a letter under
this Section 4(k) as a condition to the purchase of
Securities pursuant to such Terms Agreement, the Company
shall cause the independent certified public accountants who
have certified the financial statements of the Company and
its subsidiaries included or incorporated by reference in
the Registration Statement forthwith to furnish such Agent a
letter, dated the date of such amendment, supplement,
incorporation or Time of Delivery relating to such sale, as
the case may be, in form satisfactory to such Agent, of the
same tenor as the letter referred to in Section 6(f) hereof
but modified to relate to the Registration Statement and the
Prospectus as amended or supplemented to the date of such
letter, with such changes as may be necessary to reflect
changes in the financial statements and other information
derived from the accounting records of the Company, to the
extent such financial statements and other information are
available as of a date not more than five business days
prior to the date of such letter; provided, however, that,
with respect to any financial information or other matter,
such letter may reconfirm as true and correct at such date
as though made at and as of such date, rather than repeat,
statements with respect to such financial information or
other matter made in the letter referred to in Section 6(f)
hereof which was last furnished to such Agent;
(l) That each time the Registration Statement or
the Prospectus shall be amended or supplemented (other than
by a Pricing Supplement), each time a document filed under
the Act or the Exchange Act is incorporated by reference
into the Prospectus (except for a Current Report on Form 8-K
that is filed solely for the purpose of filing exhibits
pursuant to Item 601 of Regulation S-K, unless any Agent
shall otherwise reasonably request), and each time the
Company sells Securities to such Agent as principal and the
applicable Terms Agreement specifies the delivery of a
certificate under this Section 4(1) as a condition to the
purchase of Securities pursuant to such Terms Agreement, the
Company shall furnish or cause to be furnished forthwith to
such Agent a certificate, dated the date of such amendment,
supplement, incorporation or Time of Delivery relating to
such sale, as the case may be, in such form and executed by
such officers of the Company as shall be satisfactory to
such Agent, to the effect that the statements contained in
the certificate referred to in Section 6(i) hereof which was
last furnished to such Agent are true and correct at such
date as though made at and as of such date (except that such
statements shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented to
such date) or, in lieu of such certificate, certificates of
the same tenor as the certificates referred to in said
Section 6(i) but modified to relate to the Registration
Statement and the Prospectus as amended and supplemented to
such date;
(m) To offer to any person who has agreed to
purchase Securities as the result of an offer to purchase
solicited by such Agent the right to refuse to purchase and
pay for such Securities if, on the related settlement date
fixed pursuant to the Administrative Procedure, any
condition set forth in Section 6(a), 6(g) or 6(h) hereof
shall not have been satisfied (it being understood that the
judgment of such person with respect to the impracticability
or inadvisability of such purchase of Securities shall be
substituted, for purposes of this Section 4(m), for the
respective judgments referred to therein of an Agent with
respect to certain matters referred to in such
Sections 6(a), 6(g) and 6(h), and that such Agent shall have
no duty or obligation whatsoever to exercise the judgment
permitted under such Sections 6(a), 6(g) and 6(h) on behalf
of any such person);
(n) That prior to the issue and sale of
Securities, the Company will have received all consents,
approvals, authorizations, orders, registrations and
qualifications of or with any court or any federal or state
regulatory authority or other governmental agency or body
having jurisdiction over the Company or any of its
properties which are legally required for the issuance by
the Company of such Securities, except for consents,
approvals, authorizations, registrations or qualifications
which may be required under the state securities or Blue Sky
laws as to which no covenant is made except as provided in
Section 4(b) hereof.
5. The Company covenants and agrees with each Agent
that the Company will pay or cause to be paid the following:
(i) the fees, disbursements and expenses of the Company's counsel
and accountants in connection with the registration of the
Securities under the Act and all other expenses in connection
with the preparation, printing and filing of the Registration
Statement, any Preliminary Prospectus, the Prospectus and any
Pricing Supplements and all other amendments and supplements
thereto and the mailing and delivering of copies thereof to such
Agent; (ii) the fees, disbursements and expenses of counsel for
the Agents in connection with the establishment of the program
contemplated hereby, any opinions to be rendered by such counsel
hereunder and the transactions contemplated hereunder; (iii) the
cost of printing, preparing by word processor or reproducing this
Agreement, any Terms Agreement, any Indenture, any Blue Sky and
Legal Investment Memoranda and any other documents in connection
with the offering, purchase, sale and delivery of the Securities;
(iv) all expenses in connection with the qualification of the
Securities for offering and sale under state securities laws as
provided in Section 4(b) hereof, including fees and disbursements
of counsel for the Agents in connection with such qualification
and in connection with the Blue Sky and legal investment surveys;
(v) any fees charged by securities rating services for rating the
Securities; (vi) any filing fees incident to any required review
by the National Association of Securities Dealers, Inc. of the
terms of the sale of the Securities; (vii) the cost of preparing
the Securities; (viii) the fees and expenses of any Trustee and
any agent of any Trustee and any transfer or paying agent of the
Company and the fees and disbursements of counsel for any Trustee
or such agent in connection with any Indenture and the
Securities; (ix) any advertising expenses connected with the
solicitation of offers to purchase and the sale of Securities so
long as such advertising expenses have been approved by the
Company; (x) all other reasonable costs, and expenses incident to
the performance of the Agents' obligations hereunder which are
not otherwise specifically provided for in this Section; and
(xi) all other costs and expenses incident to the performance of
its obligations hereunder which are not otherwise specifically
provided for in this Section. Except as provided in Sections 8
and 9 hereof, each Agent shall pay all other expenses it incurs,
including any expenses that may be incurred pursuant to
Section 4(c) hereof.
6. The obligation of any Agent, as agent of the
Company, at any time ("Solicitation Time") to solicit offers to
purchase the Securities and the obligation of any Agent to
purchase Securities as principal, pursuant to any Terms Agreement
or otherwise, shall in each case be subject, in such Agent's
discretion, to the condition that all representations and
warranties and other statements of the Company herein (and, in
the case of an obligation of an Agent under a Terms Agreement, in
or incorporated in such Terms Agreement by reference) are true
and correct at and as of the Commencement Date and any applicable
date referred to in Section 4(1) hereof that is prior to such
Solicitation Time or Time of Delivery, as the case may be, and at
and as of such Solicitation Time or Time of Delivery, as the case
may be, the condition that prior to such Solicitation Time or
Time of Delivery, as the case may be, the Company shall have
performed all of its obligations hereunder theretofore to be
performed, and the following additional conditions:
(a) (i) With respect to any Securities sold at
or prior to such Solicitation Time or Time of Delivery, as
the case may be, the Prospectus as amended or supplemented
(including the Pricing Supplement) with respect to such
Securities shall have been filed or transmitted for filing
with the Commission pursuant to Rule 424(b) under the Act
within the applicable time period prescribed for such filing
by the rules and regulations under the Act and in accordance
with Section 4(a) hereof; (ii) no stop order suspending the
effectiveness of the Registration Statement shall have been
issued and no proceeding for that purpose shall be pending
before, or to the knowledge of the Company or the Agent
contemplated by, the Commission; and (iii) all requests of
the Commission for additional information (to be included in
the Registration Statement or the Prospectus or otherwise)
shall have been complied with to the reasonable satisfaction
of such Agent;
(b) There shall have been issued and there shall
be in full force and effect, appropriate orders of the
Washington Utilities and Transportation Commission, the
California Public Utilities Commission, the Idaho Public
Utilities Commission and the Public Utility Commission of
Oregon permitting the issuance and sale of the Securities on
the terms herein set forth or contemplated, and containing
no provision reasonably unacceptable to the Agents (it being
understood that no such order in effect on the date of this
Agreement contains any such unacceptable provision);
(c) Sullivan & Cromwell, counsel to the Agents,
shall have furnished to such Agent (i) such opinion or
opinions, dated the Commencement Date, with respect to the
incorporation of the Company, the validity of the Indenture,
the Securities, the Registration Statement, the Prospectus
as amended or supplemented and other related matters as such
Agent may reasonably request, and (ii) if and to the extent
requested by such Agent, with respect to each applicable
date referred to in Section 4(h) hereof that is on or prior
to such Solicitation Time or Time of Delivery, as the case
may be, an opinion or opinions, dated such applicable date,
to the effect that such Agent may rely on the opinion or
opinions which were last furnished to such Agent pursuant to
this Section 6(c) to the same extent as though it or they
were dated the date of such letter authorizing reliance
(except that the statements in such last opinion or opinions
shall be deemed to relate to the Registration Statement and
the Prospectus as amended and supplemented to such date) or,
in any case, in lieu of such an opinion or opinions, an
opinion or opinions of the same tenor as the opinions or
opinions referred to in clause (i) but modified to relate to
the Registration Statement and the Prospectus as amended and
supplemented to such date; and in each case such counsel
shall have received such papers and information as they may
reasonably request to enable them to pass upon such matters.
In rendering such opinion or opinions, Sullivan & Cromwell
may rely, as to the incorporation of the Company and as to
all other matters governed by Washington, California, Idaho,
Montana or Oregon law, upon the opinion of Paine, Hamblen,
Coffin, Brooke & Miller referred to below;
(d) Paine, Hamblen, Coffin, Brooke & Miller LLP,
General Counsel for the Company, or other counsel for the
Company satisfactory to such Agent, shall have furnished to
such Agent their written opinions, dated the Commencement
Date and each applicable date referred to in Section 4(i)
hereof that is on or prior to such Solicitation Time or Time
of Delivery, as the case may be, in form and substance
satisfactory to such Agent, to the effect set forth in
Annex III.
In rendering such opinion or opinions, Paine,
Hamblen, Coffin, Brooke & Miller may rely as to all matters
governed by New York law and Federal laws relating to the
issuance and sale of securities upon the opinion of Reid &
Priest LLP referred to below;
(e) Reid & Priest LLP, counsel for the Company,
or other counsel for the Company satisfactory to such Agent,
shall have furnished to such Agent their written opinions,
dated the Commencement Date and each applicable date
referred to in Section 4(j) hereof that is on or prior to
such Solicitation Time or Time of Delivery, as the case may
be, in form and substance satisfactory to such Agent, to the
effect set forth in Annex IV.
In rendering such opinion or opinions, Reid &
Priest LLP may rely, as to the incorporation of the Company
and as to all other matters governed by Washington,
California, Idaho, Montana or Oregon law, upon the opinion
of Paine, Hamblen, Coffin, Brooke & Miller referred to
above;
(f) Not later than 11:00 a.m., New York City
time, on the Commencement Date and on each applicable date
referred to in Section 4(k) hereof that is on or prior to
such Solicitation Time or Time of Delivery, as the case may
be, the independent certified public accountants who have
certified the financial statements of the Company and its
subsidiaries included or incorporated by reference in the
Registration Statement shall have furnished to such Agent a
letter, dated the Commencement Date or such applicable date,
as the case may be, in form and substance satisfactory to
such Agent, to the effect set forth in Annex V hereto;
(g) Except as set forth in or contemplated by the
Prospectus, as amended or supplemented, (A) since the
respective dates as of which information is given in the
Prospectus, as amended or supplemented, there has not been
any material adverse change in the condition of the Company
and its subsidiaries as a whole, financial or otherwise,
(B) since such dates there has not been any transaction
entered into by the Company or any subsidiary thereof which
is material to the Company and its subsidiaries as a whole
other than transactions in the ordinary course of business,
and (C) neither the Company nor any of its subsidiaries has
any contingent obligation which is material to the Company
and its subsidiaries as a whole, and the effect of which, in
any such case, is in the reasonable judgment of such Agent,
so material and adverse as to make it impracticable or
inadvisable to proceed with the solicitation by such Agent
of offers to purchase Securities from the Company or the
purchase by such Agent of Securities from the Company as
principal, as the case may be, on the terms and in the
manner contemplated in the Prospectus as amended or
supplemented;
(h) There shall not have occurred any of the
following: (i) a suspension or material limitation in
trading in securities generally on the New York Stock
Exchange; (ii) trading of any securities of the Company
shall have been suspended or limited on any securities
exchange or in any over-the-counter market; (iii) a general
moratorium on commercial banking activities in New York
declared by either Federal or New York State authorities;
(iv) the outbreak of major hostilities or the material
escalation of existing hostilities so as to result in major
hostilities, or the declaration by the United States of a
national emergency or war, or other national or
international calamity or crisis; or (v) any downgrading in
the rating accorded the Company's debt securities by any
"nationally recognized statistical rating organization" (as
that term is defined by the Commission for purposes of
Rule 436(g)(2) under the Act) or the placing by any such
organization of the Company's outstanding debt securities or
preferred stock on what is commonly termed a "watch list"
for possible downgrading; provided, however, that in the
case of any event described in clause (iv) or clause (v)
above, the effect of such event, in the reasonable judgment
of such Agent, shall make it impracticable or inadvisable to
proceed with the solicitation of offers to purchase
Securities, the purchase of Securities from the Company as
principal, pursuant to the applicable Terms Agreement or
otherwise, or the enforcement of contracts for the sale of
Securities, as the case may be, on the terms and in the
manner contemplated in the Prospectus as amended or
supplemented; and
(i) The Company shall have furnished or caused to
be furnished to such Agent certificates of officers of the
Company dated the Commencement Date and each applicable date
referred to in Section 4(1) hereof that is on or prior to
such Solicitation Time or Time of Delivery, as the case may
be, in such form and executed by such officers of the
Company as shall be satisfactory to such Agent, as to the
accuracy of the representations and warranties of the
Company herein at and as of the Commencement Date or such
applicable date, as the case may be, as to the performance
by the Company in all material respects of all of its
obligations hereunder to be performed at or prior to the
Commencement Date or such applicable date, as the case may
be, as to the matters set forth in subsections (a) and (g)
of this Section 6, and as to such other matters as such
Agent may reasonably request.
7. The obligation of the Company to sell and deliver
Securities, pursuant to any Terms Agreement or otherwise, shall
in each case be subject to the following conditions:
(a) On the Settlement Date for the Securities or
Time of Delivery, as the case may be, no stop order
suspending the effectiveness of the Registration Statement
shall have been issued and no proceedings for that purpose
shall be pending before, or to the knowledge of the Company
or the Agent contemplated by, the Commission.
(b) At or before the Settlement Date or Time of
Delivery, as the case may be, there shall have been issued,
and there shall be in full force and effect, appropriate
orders of the Washington Utilities and Transportation
Commission, the California Public Utilities Commission, the
Idaho Public Utilities Commission and the Public Utility
Commission of Oregon permitting the issuance and sale of the
Securities on the terms herein set forth or contemplated,
and containing no provision reasonably unacceptable to the
Company (it being understood that no such order in effect on
the date of this Agreement contains any such unacceptable
provision).
If any of the conditions specified above in this
Section shall not have been fulfilled, the Terms Agreement may be
terminated by the Company without liability on the part of any
party to any other party, except for the obligation of the
Company to pay certain expenses to the extent provided for in
Sections 6(h) and 6(i) hereof and except for any liability under
Section 8 hereof.
8. (a) The Company will indemnify and hold harmless
each Agent against any losses, claims, damages or liabilities,
joint or several, to which such Agent may become subject, under
the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the
Registration Statement, the Prospectus, the Prospectus as amended
or supplemented or any other prospectus relating to the
Securities, or any amendment or supplement thereto, or arise out
of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; and will
reimburse such Agent for any legal or other expenses reasonably
incurred by it in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however,
that the Company shall not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out
of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary
Prospectus, the Registration Statement, the Prospectus, the
Prospectus as amended or supplemented or any other prospectus
relating to the Securities, or any such amendment or supplement,
in reliance upon and in conformity with written information
furnished to the Company by such Agent specifically for use in
the preparation thereof; and provided, further, that, the
indemnity agreement contained in this subsection (a) shall not
inure to the benefit of any Agent on account of any such losses,
claims, damages or liabilities (or actions in respect thereof)
arising from the sale of the Securities by or through such Agent
to any person if a copy of the Prospectus as it then may be
amended or supplemented (exclusive of the Incorporated Documents)
shall not have been given or sent to such person by such Agent
with or prior to the written confirmation of the sale involved to
the extent that (i) the Prospectus as so amended or supplemented
would have cured the defect in such document giving rise to such
losses, claims, damages or liabilities, (ii) sufficient
quantities of the Prospectus as so amended or supplemented were
timely made available to such Agent and (iii) such Agent shall
not have reasonably objected to such amendment or supplement
pursuant to Section 4(a) hereof.
(b) Each Agent will indemnify and hold harmless the
Company against any losses, claims, damages or liabilities to
which the Company may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration
Statement, the Prospectus, the Prospectus as amended or
supplemented or any other prospectus relating to the Securities,
or any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made
in any Preliminary Prospectus, the Registration Statement, the
Prospectus, the Prospectus as amended or supplemented or any
other prospectus relating to the Securities, or any such
amendment or supplement, in reliance upon and in conformity with
written information furnished to the Company by such Agent
specifically for use in the preparation thereof; and will
reimburse the Company for any legal or other expenses reasonably
incurred by the Company in connection with investigating or
defending any such loss, claim, damage, liability or action.
(c) Promptly after receipt by an indemnified party
under subsection (a) or (b) above of notice of the commencement
of any action, such indemnified party shall, if a claim in
respect thereof is to be made against the indemnifying party
under such subsection, notify the indemnifying party in writing
of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which
it may have to any indemnified party otherwise than under such
subsection. In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of
the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall
wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party (who shall not, except
with the consent of the indemnified party, be counsel to the
indemnifying party), and, after notice from the indemnifying
party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party shall not be liable to
such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case
subsequently incurred by such indemnified party, in connection
with the defense thereof other than reasonable costs of
investigation. In any such proceeding, any indemnified party
shall have the right to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of such
indemnified party unless (i) the indemnifying party and the
indemnified party shall have mutually agreed to the retention of
such counsel or (ii) the named parties to any such proceeding
(including any impleaded parties) include both the indemnifying
party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual
or potential differing interests between them.
(d) If the indemnification provided for in this
Section 8 is unavailable to or insufficient to hold harmless an
indemnified party under subsection (a) or (b) above in respect of
any losses, claims, damages or liabilities (or actions in respect
thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is
appropriate to reflect the relative benefits received by the
Company on the one hand and each Agent on the other from the
offering of the Securities to which such loss, claim, damage or
liability (or action in respect thereof) relates and the relative
fault of the Company on the one hand and the Agent on the other
in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. The relative benefits
received by the Company on the one hand and each Agent on the
other shall be deemed to be in the same proportion as the total
net proceeds from the sale of Securities (before deducting
expenses) received by the Company bear to the total commissions
or discounts received by such Agent in respect thereof. The
relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a
material fact required to be stated therein or necessary in order
to make the statements therein not misleading relates to
information supplied by the Company on the one hand or by any
Agent on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such
statement or omission. The Company and each Agent agree that it
would not be just and equitable if contribution pursuant to this
subsection (d) were determined by per capita allocation (even if
all Agents were treated as one entity for such purpose) or by any
other method of allocation which does not take account of the
equitable considerations referred to above in this
subsection (d). The amount paid or payable by an indemnified
party as a result of the losses, claims, damages or liabilities
(or actions in respect thereof) referred to above in this sub-
section (d) shall, except as limited by subsection (c) above, be
deemed to include any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the
provisions of this subsection (d), an Agent shall not be required
to contribute any amount in excess of the amount by which the
total public offering price at which the Securities purchased by
or through it were sold exceeds the amount of any damages which
such Agent has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The obligations of each of
the Agents under this subsection (d) to contribute are several in
proportion to the respective purchases made by it or through it
to which such loss, claim, damage or liability (or action in
respect thereof) relates and are not joint.
(e) The obligations of the Company under this
Section 8 shall be in addition to any liability which the Company
may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls any Agent within
the meaning of the Act; and the obligations of each Agent under
this Section 8 shall be in addition to any liability which such
Agent may otherwise have and shall extend, upon the same terms
and conditions, to each director of the Company, to each officer
of the Company who has signed the Registration Statement and to
each person, if any, who controls the Company within the meaning
of the Act.
9. (a) Each Agent, in soliciting offers to purchase
Securities from the Company and in performing the other
obligations of such Agent hereunder (other than in respect of any
purchase by an Agent as principal pursuant to a Terms Agreement
or otherwise), is acting solely as agent for the Company and not
as principal. Each Agent will make reasonable efforts to assist
the Company in obtaining performance by each purchaser whose
offer to purchase Securities from the Company was solicited by
such Agent and has been accepted by the Company, but such Agent
shall not have any liability to the Company in the event such
purchase is not consummated for any reason.
(b) If the Company shall default on its obligation to
deliver Securities to a purchaser whose offer it has accepted,
the Company shall (i) hold each Agent harmless against any loss,
claim or damage arising from or as a result of such default by
the Company and (ii) notwithstanding such default, pay to the
Agent that solicited such offer any commission to which it would
be entitled in connection with such sale.
10. The respective indemnities, agreements, repre-
sentations, warranties and other statements by any Agent and the
Company set forth in or made pursuant to this Agreement shall
remain in full force and effect regardless of any investigation
(or any statement as to the results thereof) made by or on behalf
of any Agent or any controlling person of any Agent or the
Company, or any officer or director or any controlling person of
the Company, and shall survive each delivery of and payment for
any of the Securities.
11. The provisions of this Agreement relating to the
solicitation of offers to purchase securities from the Company
may be suspended or terminated at any time by the Company as to
any Agent or by any Agent as to such Agent upon the giving of
written notice of such suspension or termination to such Agent or
the Company, as the case may be. In the event of such suspension
or termination with respect to any Agent, (x) this Agreement
shall remain in full force and effect with respect to any Agent
as to which such suspension or termination has not occurred,
(y) this Agreement shall remain in full force and effect with
respect to the rights and obligations of any party which have
previously accrued or which relate to Securities which are
already issued, agreed to be issued or the subject of a pending
offer at the time of such suspension or termination and (z) in
any event, this Agreement shall remain in full force and effect
insofar as the fourth paragraph of Section 2(a), Section 4(d),
Section 4(e), Section 5, Section 8, Section 9 and Section 10
hereof are concerned.
12. Except as otherwise specifically provided herein
or in the Administrative Procedure, all statements, requests,
notices and advices hereunder shall be in writing, or by
telephone if promptly confirmed in writing, and if to Morgan
Stanley & Co. Incorporated shall be sufficient in all respects
when delivered or sent by facsimile transmission or registered
mail to 1585 Broadway, 2nd Floor, New York, New York 10036,
Facsimile Transmission No. (212) 761-0780, Attention: Manager -
Continuously Offered Products, Telephone No. (212) 761-2000, with
a copy to 1585 Broadway, 34th Floor, New York, New York 10036,
Facsimile Transmission No. (212) 761-0260, Attention: Peter
Cooper, Investment Banking Information Center, Telephone No.
(212) 761-8385, and if to Merrill Lynch, Pierce, Fenner & Smith
Incorporated shall be sufficient in all respects when delivered
or sent by facsimile transmission or registered mail to 250 Vesey
Street, New York, New York 10281, Facsimile Transmission No.
(212) 449-2231, Attention: MTN Product Management, Telephone No.
(212) 449-7476, and if to Salomon Brothers Inc shall be
sufficient in all respects when delivered or sent by facsimile
transmission or registered mail to 7 World Trade Center, New
York, New York, 10048, Facsimile Transmission No. (212) 783-2274,
Attention: Medium-Term Note Department, Telephone No. (212) 783-
5897, and if to the Company shall be sufficient in all respects
when delivered or sent by facsimile transmission or registered
mail to 1411 East Mission Avenue, Spokane, Washington 99202,
Attention: Treasurer, Facsimile Transmission No. (509) 482-4879,
Telephone No. (509) 489-0500.
13. This Agreement and any Terms Agreement shall be
binding upon, and inure solely to the benefit of, each Agent and
the Company, and to the extent provided in Section 8, Section 9
and Section 10 hereof, the officers and directors of the Company
and any person who controls any Agent or the Company, and their
respective personal representatives, successors and assigns, and
no other person shall acquire or have any right under or by
virtue of this Agreement or any Terms Agreement. No purchaser of
any of the Securities through or from any Agent hereunder shall
be deemed a successor or assign by reason merely of such
purchase.
14. Time shall be of the essence in this Agreement and
any Terms Agreement. As used herein, the term "business day"
shall mean any day when the office of the Commission in
Washington, D.C. is open for business.
15. THIS AGREEMENT AND ANY TERMS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAWS
PROVISIONS THEREOF.
16. This Agreement and any Terms Agreement may be
executed by any one or more of the parties hereto and thereto in
any number of counterparts, each of which shall be an original,
but all of such respective counterparts shall together constitute
one and the same instrument.
If the foregoing is in accordance with your under-
standing, please sign and return to us four counterparts hereof,
whereupon this letter and the acceptance by each of you thereof
shall constitute a binding agreement between the Company and each
of you in accordance with its terms.
Very truly yours,
THE WASHINGTON WATER POWER COMPANY
By:
-------------------------------
Title:
Accepted in New York, New York
as of the date hereof:
MORGAN STANLEY & CO. INCORPORATED
By:
------------------------------
Title:
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
By:
------------------------------
Title:
SALOMON BROTHERS INC
By:
------------------------------
Title:
ANNEX I
The Washington Water Power Company
Medium-Term Notes, Series C
Terms Agreement
---------------
, 19
------------------ --
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Merrill Lynch, Pierce, Fenner & Smith Incorporated
World Financial Center
250 Vesey Street
New York, New York 10281
Salomon Brothers Inc
7 World Trade Center
New York, New York 10048
Ladies and Gentlemen:
The Washington Water Power Company (the "Company")
proposes, subject to the terms and conditions stated herein and
in the Distribution Agreement, dated , 1998 (the
----- --
"Distribution Agreement"), between the Company on the one hand
and Morgan Stanley & Co. Incorporated, Merrill Lynch, Pierce,
Fenner & Smith Incorporated and Salomon Brothers Inc (the
"Agents") on the other, to issue and sell to [Morgan Stanley &
Co. Incorporated] [Merrill Lynch, Pierce, Fenner & Smith
Incorporated] [Salomon Brothers Inc] the securities specified in
the Schedule hereto (the "Purchased Securities"). Each of the
provisions of the Distribution Agreement not specifically related
to the solicitation by the Agents, as agents of the Company, of
offers to purchase Securities is incorporated herein by reference
in its entirety, and shall be deemed to be part of this Terms
Agreement to the same extent as if such provisions had been set
forth in full herein. Nothing contained herein or in the
Distribution Agreement shall make any party hereto an agent of
the Company or make such party subject to the provisions therein
relating to the solicitation of offers to purchase securities
from the Company, solely by virtue of its execution of this Terms
Agreement. Each of the representations and warranties set forth
therein shall be deemed to have been made at and as of the date
of this Terms Agreement, except that each representation and
warranty in Section 1 of the Distribution Agreement which makes
reference to the Prospectus shall be deemed to be a
representation and warranty as of the date of the Distribution
Agreement in relation to the Prospectus (as therein defined), and
also a representation and warranty as of the date of this Terms
Agreement in relation to the Prospectus as amended and
supplemented to relate to the Purchased Securities.
An amendment to the Registration Statement, or a
supplement to the Prospectus, as the case may be, relating to the
Purchased Securities, in the form heretofore delivered to you is
now proposed to be filed with the Commission.
Subject to the terms and conditions set forth herein
and in the Distribution Agreement incorporated herein by
reference, the Company agrees to issue and sell to [Merrill
Lynch, Pierce, Fenner & Smith Incorporated] [Morgan Stanley & Co.
Incorporated] [Salomon Brothers Inc] and [Merrill Lynch, Pierce,
Fenner & Smith Incorporated] [Morgan Stanley & Co. Incorporated]
[Salomon Brothers Inc] agree[s] to purchase from the Company the
Purchased Securities, at the time and place, in the principal
amount and at the purchase price set forth in the Schedule
hereto.
If the foregoing is in accordance with your
understanding, please sign and return to us three counterparts
hereof, and upon acceptance hereof by you this letter and such
acceptance hereof, including those provisions of the Distribution
Agreement incorporated herein by reference, shall constitute a
binding agreement between you and the Company.
THE WASHINGTON WATER POWER COMPANY
By:
----------------------------
Accepted in New York, New York,
as of the date hereof:
[MORGAN STANLEY & CO. INCORPORATED
By:
--------------------------------
Title:]
[MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
By:
--------------------------------
Title:]
[SALOMON BROTHERS INC
By:
--------------------------------
Title:]
Schedule to Annex I
Title of Purchased Securities:
-----------------------------
Medium-Term Notes, Series C
Aggregate Principal Amount:
--------------------------
$
[Price to Public:]
Purchase Price by: [Morgan Stanley & Co. Incorporated] [Merrill
Lynch, Pierce, Fenner & Smith Incorporated] [Salomon Brothers
Inc]
% of the principal amount of the Purchased Securities
[, plus accrued interest from to ] [and accrued
amortization, if any, from to ]
Method of and Specified Funds for Payment of Purchase Price:
-----------------------------------------------------------
[By certified or official bank check or checks, payable
to the order to the Company, in [New York Clearing House]
[immediately available] funds]
[By wire transfer to a bank account specified by the
Company in [next day] [immediately available] funds]
Time of Delivery:
----------------
Closing Location:
----------------
Maturity:
--------
Interest Rate:
-------------
%
Interest Payment Dates:
----------------------
[months and dates]
Documents to Delivered:
----------------------
The following documents referred to in the Distribution
Agreement shall be delivered as a condition to the Closing:
[(1) The opinion or opinions of counsel to the Agents
referred to in Section 4(h).]
[(2) The opinion of counsel to the Company referred to
in Section 4(i).]
[(3) The opinion of counsel to the Company referred to
in Section 4(j).]
[(4) The accountants' letter referred to in Section
4(k).]
[(5) The officers' certificate referred to in Section
4(1).]
Other provisions (including Syndicate Provisions, if applicable):
----------------------------------------------------------------
ANNEX II
The Washington Water Power Company
Administrative Procedure
------------------------
This Administrative Procedure relates to the Securities
defined in the Distribution Agreement, dated , 1998 (the
----- --
"Distribution Agreement"), between The Washington Water Power
Company (the "Company") and Morgan Stanley & Co. Incorporated,
Merrill Lynch, Pierce, Fenner & Smith Incorporated and Salomon
Brothers Inc (the "Agents"), to which this Administrative
Procedure is attached as Annex II. Defined terms used herein and
not defined herein shall have the meanings given such terms in
the Distribution Agreement, the Prospectus (as defined therein),
as amended or supplemented, or the Indenture referred to below.
The procedures to be followed with respect to the
settlement of sales of Securities directly by the Company to
purchasers solicited by an Agent, as agent, are set forth below.
The terms and settlement details related to a purchase of
Securities by an Agent, as principal, from the Company will be
set forth in a Terms Agreement pursuant to the Distribution
Agreement, unless the Company and such Agent otherwise agree as
provided in Section 2(b) of the Distribution Agreement, in which
case the procedures to be followed in respect of the settlement
of such sale will be as set forth below. An Agent, in relation
to a purchase of a Security by a purchaser solicited by such
Agent, is referred to herein as the "Selling Agent" and, in
relation to a purchase of a Security by such Agent as principal
other than pursuant to a Terms Agreement, as the "Purchasing
Agent."
The Securities will be issued under the Company's
Indenture, dated as of , 1998, to The Chase Manhattan Bank,
---- -
as trustee (the "Trustee") as it will be supplemented by an
Officer's Certificate dated , 1998 (such Indenture, as
------- --
so supplemented and as it may be amended and further
supplemented, being hereinafter referred to as the "Indenture").
The Chase Manhattan Bank ("Chase") will act as paying agent for
the payment of principal and of premium, if any, and interest on
the Securities, and will perform in various capacities unless
otherwise specified by the Company or agreed by the parties, the
other duties specified herein.
The Company will advise each Agent in writing of those
persons with whom such Agent is to communicate regarding offers
to purchase Securities and the related settlement details.
Each tranche of the Securities will be represented
entirely by either a Global Security (as defined below) delivered
to Chase, as agent for The Depository Trust Company ("DTC"), and
recorded in the book-entry system maintained by DTC (a "Book-
Entry Security") or by a certificate(s) issued as a registered
Security or Securities delivered to the holder(s) thereof or a
person(s) designated by such holder(s) (a "Certificated
Security"). An owner of a Book-Entry Security will not be
entitled to receive a certificate representing such a Security
except under the limited circumstances described in the
Prospectus. An owner of a Certificated Security will not be
entitled to become in lieu thereof the owner of a Book-Entry
Security.
Administrative procedures and specific terms of the
offering are explained below. Certificated Securities will be
issued in accordance with the administrative procedures set forth
in Part I hereof and Book-Entry Securities will be issued in
accordance with the administrative procedures set forth in Part
II hereof. Administrative responsibilities and record-keeping
functions not performed by Chase or DTC will be performed by the
Company's Treasurer or its Assistant Treasurer.
PART I: ADMINISTRATIVE PROCEDURE FOR CERTIFICATED SECURITIES
Posting Rates by Company:
------------------------
The Company and the Agents will discuss from time to
time the rates of interest per annum to be borne by and the
maturity of Certificated Securities that may be sold as a result
of the solicitation of offers by an Agent. The Company may
establish interest rates and maturities for an offering period
("posting") which shall, at all times, be within the limitations
set forth by the Company's Board of Directors and in the orders
of the Washington Utilities and Transportation Commission
("WUTC"), the California Public Utilities Commission ("CPUC"),
the Idaho Public Utilities Commission ("IPUC") and the Public
Utility Commission of Oregon ("OPUC") applicable to the issuance
and sale of the Securities. If the Company decides to change
already posted rates, it will promptly advise the Agents to
suspend solicitation of offers until the new posted rates have
been established with the Agents.
Acceptance of Offers by Company:
-------------------------------
Each Agent will promptly advise the Company by
telephone or other appropriate means of all reasonable offers to
purchase Certificated Securities, other than those rejected by
such Agent. Each Agent may, in its discretion reasonably
exercised, reject any offer received by it in whole or in part.
Each Agent also may make offers to the Company to purchase
Certificated Securities as a Purchasing Agent. The Company will
have the sole right to accept offers to purchase Certificated
Securities and may reject any such offer in whole or in part.
The Company will promptly notify the Selling Agent or
Purchasing Agent, as the case may be, of its acceptance or
rejection of an offer to purchase Certificated Securities. If
the Company accepts as offer to purchase Certificated Securities,
it will confirm such acceptance in writing to the Selling Agent
or Purchasing Agent, as the case may be, and Chase.
Communication of Sale Information to Company by Selling Agent:
-------------------------------------------------------------
After the acceptance of an offer by the Company, the
Selling Agent or Purchasing Agent, as the case may be, will
communicate the following details of the terms of such offer (the
"Sale Information") to the Company by telephone (confirmed in
writing) or by facsimile transmission or other acceptable written
means:
(1) Whether the Security is a Certificated Security or
a Book-Entry Security;
(2) Principal amount of Certificated Securities to be
purchased;
(3) Interest rate, interest payment dates, including
without limitation all necessary information with
respect to Floating Rate Notes, and initial
interest payment date;
(4) Stated Maturity Date;
(5) Issue Price;
(6) Selling Agent's commission or Purchasing Agent's
discount or commission, as the case may be;
(7) Net proceeds to the Company;
(8) Settlement Date (Original Issue Date);
(9) If a redeemable Certificated Security, such of the
following as are applicable:
(a) Initial Redemption Date;
(b) Initial Redemption Price (% of par);
(c) Amount (% of par) that the Redemption Price
shall decline (but not below par) ("Reduction
Percentage") and the dates on which such
Redemption Price shall decline after the
Initial Redemption Date; and
(d) Redemption Limitation Date.
(10) Name, address and taxpayer identification number
of the registered owner;
(11) Denomination of certificates to be delivered at
Settlement; and
(12) All other information necessary to complete the
form of Security prior to its authentication and
delivery.
Preparation of Pricing Supplement by Company:
--------------------------------------------
If the Company accepts an offer to purchase a
Certificated Security, it will prepare a Pricing Supplement. The
Company will arrange to have ten Pricing Supplements filed with
the Commission not later than the close of business of the
Commission on the third Business Day following the date on which
such Pricing Supplement is first used and will supply at least
ten copies of such Pricing Supplement to the Selling Agent or
Purchasing Agent, as the case may be. In addition, the Company
will file as required copies of the Pricing Supplement with the
applicable state regulatory authorities concurrently with the
filing of the Pricing Supplement with the Commission.
Delivery of Confirmation and Prospectus to Purchaser by Selling
---------------------------------------------------------------
Agent:
-----
The Selling Agent will deliver to the purchaser of a
Security a written confirmation of the sale and delivery and
payment instructions. In addition, the Selling Agent will
deliver to such purchaser or its agent the prospectus as amended
or supplemented (including the Pricing Supplement) relating to
such Certificated Security prior to or together with the earlier
of the delivery to such purchaser or its agent of (a) the
confirmation of sale or (b) the Certificated Security.
Date of Settlement:
------------------
The receipt by the Company of immediately available
funds in payment for a Certificated Security shall constitute
"Settlement" with respect to such Certificated Security. All
orders accepted by the Company will be settled on a date (the
"Settlement Date") which is the third Business Day after the date
of acceptance of such offer, unless the Company and the purchaser
agree to Settlement (a) on any other Business Day after the
acceptance of such offer or (b) with respect to an offer accepted
by the Company prior to 10:00 a.m., New York City time, on the
date of such acceptance, provided that such day shall be a
Business Day.
Instruction from Company to Trustee for Preparation of
------------------------------------------------------
Certificated Securities:
-----------------------
After receiving the Sale Information from the Selling
Agent or Purchasing Agent, as the case may be, the Company will
communicate such Sale Information to the Trustee by Company Order
by facsimile transmission or other acceptable written means.
The Company will instruct the Trustee by Company Order
by facsimile transmission or other acceptable written means to
authenticate and deliver the Certificated Securities no later
than 2:15 p.m., New York City time, on the Settlement Date. Such
instruction will be given by the Company prior to 3:00 p.m., New
York City time, on the Business Day prior to the Settlement Date
unless the Settlement Date is the date of acceptance by the
Company of the offer to purchase Certificated Securities in which
case such instruction will be given by the Company to the Trustee
by 11:00 a.m., New York City time.
Preparation and Delivery of Securities by Trustee and Receipt of
---------------------------------------------------------------
Payment Therefor:
----------------
The Trustee will prepare each Certificated Security and
appropriate receipts that will serve as the documentary control
of the transaction.
In the case of a sale of Certificated Securities to a
purchaser solicited by an Agent, the Trustee will, by 2:15 p.m.,
New York City time, on the Settlement Date, deliver the
Certificated Securities to the Selling Agent, at the address
listed below, for the benefit of the purchaser of such
Certificated Securities against delivery by the Selling Agent of
a receipt therefor. On the Settlement Date the Selling Agent
will deliver payment for such Certificated Securities in
immediately available funds to the Company's account at a bank
designated by the Company and notified by the Company to the
Selling Agent at least three days prior to the Settlement Date in
an amount equal to the issue price of the Certificated Securities
less the Selling Agent's commission. Any monies received by an
Agent from a purchaser of Securities in payment of the purchase
price of such Securities from the time the Trustee delivers the
Securities to the Selling Agent to the time the Agent delivers
payment for such Securities to the Company's account, as provided
above, shall be held by such Agent, as agent of the Company.
In the case of a sale of Certificated Securities to a
Purchasing Agent, the Trustee will, by 2:15 p.m., New York City
time, on the Settlement Date, deliver the Certificated Securities
to the Purchasing Agent against delivery by the Purchasing Agent
of a receipt therefor. On the Settlement Date, the Purchasing
Agent will deliver payment for such Certificated Securities in
immediately available funds, or otherwise pursuant to the Terms
Agreement, to the account of the Company as designated in the
preceding paragraph in an amount equal to the issue price of the
Certificated Securities less the Purchasing Agent's discount.
Failure of Purchaser to Pay Selling Agent:
-----------------------------------------
If a purchaser (other than a Purchasing Agent) fails to
make payment to the Selling Agent for a Certificated Security,
the Selling Agent will promptly notify the Trustee and the
Company thereof by telephone (promptly confirmed in writing) or
by facsimile transmission or by other acceptable written means.
The Selling Agent will immediately return the Certificated
Security to the Trustee. Immediately upon receipt of such
Certificated Security by the Trustee, the Company will return to
the Selling Agent the amount previously paid to the Company in
respect of such Certificated Security. The Company will, in
addition, reimburse the Selling Agent on an equitable basis for
its loss of the use of funds during the period when they were
credited to the account of the Company; provided, however, that
the Selling Agent shall be entitled to no reimbursement hereunder
if funds are returned on the day on which such funds had been
previously credited to the account of the Company such that the
Selling Agent is afforded a reasonable opportunity to invest such
funds at an overnight rate on such day; and provided further that
if the Selling Agent is denied the use of such funds due to its
failure to return the relevant Certificated Security to the
Trustee in a timely manner it shall only be entitled to
reimbursement hereunder in an amount equal to the amount that
would have been earned on such funds had such funds been on
deposit at an overnight rate during the period between their
credit to the account of the Company and their reimbursement to
the Agent.
The Trustee will cancel the Certificated Security in
respect of which the failure occurred, make appropriate entries
in its records and, unless otherwise instructed by the Company,
dispose of the Certificated Security.
Delivery of the Certificated Securities:
---------------------------------------
Unless otherwise notified by any Agent to the Trustee,
the Trustee shall deliver the Certificated Securities in
accordance with the procedures set forth above to any Agent (as
the case may be) at the following addresses:
PART II: ADMINISTRATIVE PROCEDURES FOR BOOK-ENTRY SECURITIES
In connection with the qualification of the Book-Entry
Securities for eligibility in the book-entry system maintained by
DTC, Chase will perform the custodial, document control and
administrative functions described below, in accordance with its
respective obligations under a Letter of Representations from the
Company and Chase to DTC, dated the date hereof, and a Medium-
Term Note Certificate Agreement between Chase and DTC, dated as
of December 2, 1988 ("Certificate Agreement"), and its
obligations as a participant in DTC, including DTC's Same-Day
Funds Settlement System ("SDFS").
Posting Rates by Company:
------------------------
The Company and the Agents will discuss from time to
time the rates of interest per annum to be borne by and the
maturity of Book-Entry Securities that may be sold as a result of
the solicitation of offers by an Agent. The Company may
establish interest rates and maturities for an offering period
("posting") which shall, at all times, be within the limitations
set forth in the orders of the WUTC, CPUC, IPUC and OPUC
applicable to the issuance and sale of the Securities. If the
Company decides to change already posted rates, it will promptly
advise the Agents to suspend solicitation of offers until the new
posted rates have been established with the Agents.
Acceptance of Offers by Company:
-------------------------------
Each Agent will promptly advise the Company by
telephone or other appropriate means of all reasonable offers to
purchase Book-Entry Securities, other than those rejected by such
Agent. Each Agent may, in its discretion reasonably exercised,
reject any offer received by it in whole or in part. Each Agent
also may make offers to the Company to purchase Book-Entry
Securities as a Purchasing Agent. The Company will have the sole
right to accept offers to purchase Book-Entry Securities and may
reject any such offer in whole or in part.
The Company will promptly notify the Selling Agent or
Purchasing Agent, as the case may be, of its acceptance or
rejection of an offer to purchase Book-Entry Securities. If the
Company accepts an offer to purchase Book-Entry Securities, it
will confirm such acceptance in writing to the Selling Agent or
Purchasing Agent, as the case may be, and Chase.
Communication of Book-Entry Information to the Company by Selling
-----------------------------------------------------------------
Agent and Settlement Procedures:
-------------------------------
A. After the acceptance of an offer by the Company,
the Selling Agent or Purchasing Agent, as the case may be, will
communicate promptly, but in no event later than the time set
forth below under "Settlement Procedure Timetable", the following
details of the terms of such offer (the "Book-Entry Information")
to the Company by telephone (confirmed in writing) or by
facsimile transmission or other acceptable written means:
(1) Whether the Security is a Certificated Security or
a Book-Entry Security;
(2) Principal amount of Book-Entry Securities to be
purchased;
(3) Interest rate, interest payment dates, including
without limitation all necessary information with
respect to Floating Rate Notes, and initial
interest payment date;
(4) Stated Maturity Date;
(5) Issue Price;
(6) Selling Agent's commission or Purchasing Agent's
discount or commission, as the case may be;
(7) Net proceeds to the Company;
(8) Settlement Date (Original Issue Date);
(9) If a redeemable Book-Entry Security, such of the
following as are applicable:
(a) Initial Redemption Date;
(b) Initial Redemption Price (% of par);
(c) Amount (% of par) that the Redemption Price
shall decline (but not below par) ("Reduction
Percentage") and the dates on which such
Redemption Price shall decline after the
Initial Redemption Date; and
(d) Redemption Limitation Date.
(10) Exact name in which the Book-Entry Security is to
be registered, if other than Cede & Co.;
(11) Denomination of certificates to be delivered at
Settlement; and
(12) All other information necessary to complete the
form of Security prior to its authentication and
delivery.
B. The Company will advise Chase by Company Order in
writing or by facsimile or electronic transmission of the
information set forth in Settlement Procedure "A" above, and the
name of such Agent. Chase will assign a CUSIP number to the
Global Security representing such Book-Entry Security and will
notify the Company by telephone of such CUSIP number as soon as
practicable.
C. Chase will enter a pending deposit message through
DTC's Participant Terminal System, providing the following
settlement information to DTC's Underwriting Department, such
Agent and Standard & Poor's Corporation:
(1) The applicable Book-Entry Information set forth in
Settlement Procedure A;
(2) Identification numbers of the participant accounts
maintained by DTC on behalf of Chase or the Agent,
as the case may be;
(3) Identification as a Book-Entry Security;
(4) Initial Interest Payment Date for such Book-Entry
Security and amount of interest payable on such
Interest Payment Date;
(5) CUSIP number of the Global Security representing
such Book-Entry Security; and
(6) Whether such Global Security will represent any
other Book-Entry Security (to the extent known at
such time).
D. The Trustee will complete and authenticate the
Global Security representing such Security, the form of which was
previously approved by the Company, the Agents and the Trustee.
E. DTC will credit such Book-Entry Security to
Chase's participant account at DTC.
F. Chase will enter an SDFS deliver order through
DTC's Participant Terminal System instructing DTC to (i) debit
such Book-Entry Security to Chase's participant account and
credit such Book-Entry Security to such Agent's participant
account and (ii) debit such Agent's settlement account and credit
Chase's settlement account for an amount equal to the price of
such Book-Entry Security less such Agent's commission. The entry
of such a deliver order shall constitute a representation and
warranty by Chase to DTC that (a) the Global Security
representing such Book-Entry Security has been issued and
authenticated and (b) Chase is holding such Global Security
pursuant to the Certificate Agreement.
G. Such Agent will enter an SDFS deliver order
through DTC's Participant Terminal System instructing DTC (i) to
debit such Book-Entry Security to such Agent's participant
account and credit such Book-Entry Security to the participant
accounts of the Participants with respect to such Book-Entry
Security and (ii) to debit the settlement accounts of such
Participants and credit the settlement account of such Agent for
an amount equal to the price of such Book-Entry Security.
H. Transfers of funds in accordance with SDFS deliver
orders described in Settlement Procedures F and G will be settled
in accordance with SDFS operating procedures in effect on the
Settlement Date.
I. Upon confirmation of receipt of funds, Chase will
transfer to a bank account designated by the Company, in
immediately available funds, the amount transferred to Chase in
accordance with Settlement Procedure F.
J. Upon request, Chase will send to the Company a
statement setting forth the principal amount of Book-Entry
Securities outstanding as of that date under the Indenture.
K. Such Agent will confirm the purchase of such Book-
Entry Security to the purchaser either by transmitting to the
Participants with respect to such Book-Entry Security a
confirmation order or orders through DTC's institutional delivery
system or by mailing a written confirmation to such purchaser.
DTC will, upon request of the Company or Chase,
promptly furnish to the Company or Chase a list of the names and
addresses of the participants for whom DTC has credited Book-
Entry Securities.
Preparation of Pricing Supplement by Company:
--------------------------------------------
If the Company accepts an offer to purchase a Book-
Entry Security, it will prepare a Pricing Supplement. The
Company will arrange to have the Pricing Supplements filed with
the Commission not later than the close of business of the
Commission on the third Business Day following the date on which
such Pricing Supplement is first used or will arrange for such
Pricing Supplement to be transmitted to the Commission by a means
reasonably calculated to result in filing by such time and will
supply at least ten copies of such Pricing Supplement to the
Selling Agent or Purchasing Agent, as the case may be. In
addition, the Company will file as required copies of the Pricing
Supplement with the applicable state regulatory authorities
concurrently with the filing of the Pricing Supplement with the
Commission.
Delivery of Confirmation and Prospectus to Purchaser by Selling
---------------------------------------------------------------
Agent:
-----
The Selling Agent will deliver to the purchaser of a
Book-Entry Security a written confirmation of the sale and
delivery and payment instructions. In addition, the Selling
Agent will deliver to such purchaser or its agent the Prospectus
as amended or supplemented (including the Pricing Supplement)
relating to such Book-Entry Security prior to or together with
the earlier of the delivery to such purchaser or its agent of (a)
the confirmation of sale or (b) the Book-Entry Security.
Date of Settlement:
------------------
The receipt by the Company of immediately available
funds in payment for a Book-Entry Security shall constitute
"Settlement" with respect to such Book-Entry Security. All
orders accepted by the Company will be settled on a date (the
"Settlement Date") which is the third Business Day after the date
of acceptance of such offer, unless the Company and the purchaser
agree to settlement on any other Business Day after the
acceptance of such offer in each case pursuant to the Settlement
Procedures Timetable set forth below.
Settlement Procedures Timetable:
-------------------------------
For orders of Book-Entry Securities solicited by a
Selling Agent and accepted by the Company for Settlement on the
first Business Day after the sale date, Settlement Procedures A
through J set forth above shall be completed as soon as possible
but not later than the respective times (New York City time) set
forth below:
Settlement
Procedure Time
----------- ----
A-B 11 AM on the sale date
C 2 PM on the sale date
D 9 AM on the Settlement Date
E 10 AM on the Settlement Date
F 2 PM on the Settlement Date
G 4:45 PM on the Settlement Date
H-J 5 PM on the Settlement Date
If a sale is to be settled more than one Business Day
after the sale date, (i) Settlement Procedure A shall be
completed by 5 PM on the Business Day following the sale date or
11 AM on the Business Day prior to the Settlement Date, whichever
is earlier, and (ii) Settlement Procedures B and C shall be
completed as soon as practicable but no later than 2 PM on the
Business Day prior to the Settlement Date.
Settlement Procedure H is subject to extension in
accordance with any extension of Fedwire closing deadlines and in
other events specified in SDFS operating procedure in effect on
the Settlement Date.
If Settlement of a Book-Entry Security is rescheduled
or canceled, the Company will instruct Chase to deliver to DTC a
PTS cancellation message to such effect by no later than 12 Noon
and on the Business Day immediately preceding the scheduled
Settlement Date and Chase will enter such order by 2 PM on such
Business Day through DTC's Participation Terminal System.
The Company will, as soon as practicable after the
trade date for a Global Security (but no later than the dates and
times, if any, specified in the Indenture), cause to be delivered
to the Trustee an executed original of the Company Order for such
Global Security as well as all other documents required to be
delivered under the Indenture in connection with the issuance of
such Global Security, unless already delivered.
Failure to Settle
-----------------
If Chase has not entered an SDFS deliver order with
respect to a Book-Entry Security pursuant to Settlement
Procedure F, the Company may instruct Chase to deliver to DTC,
through DTC's Participant Terminal System, as soon as
practicable, a withdrawal message instructing DTC to debit such
Book-Entry Security to Chase's participant account. DTC will
process the withdrawal message, provided that Chase's participant
account contains a principal amount of the Global Security
representing such Book-Entry Security that is at least equal to
the principal amount to be debited. If a withdrawal message is
processed with respect to all the Book-Entry Securities
represented by a Global Security, Chase will mark such Global
Security "canceled", make appropriate entries in Chase's records
and send such canceled Global Security to the Company. The CUSIP
number assigned to such Global Note shall, in accordance with
CUSIP Service Bureau procedures, be canceled and not immediately
reassigned. If a withdrawal message is processed with respect to
less than the entire principal amount of the Book-Entry
Securities represented by a Global Security, Chase will exchange
such Global Security for two Global Securities, one of which
shall represent the Book-Entry Security or Securities for which a
withdrawal message has been processed and shall be canceled
immediately after issuance and the other of which shall represent
the Book-Entry Security previously represented by the surrendered
Global Security with respect to which a withdrawal message has
not been processed and shall bear the CUSIP number of the
surrendered Global Security.
If the purchase price for any Book-Entry Security is
not timely paid to the Participants with respect to such Book-
Entry Security by the beneficial purchaser thereof (or a person,
including an indirect participant in DTC, acting on behalf of
such purchaser), such Participants and, in turn, the Agent for
such Book-Entry Security may enter SDFS deliver orders through
DTC's Participant Terminal System debiting such Book-Entry
Security to such Participant's account and crediting such Book-
Entry Security to such Agent's participant account and then
debiting such Book-Entry Security to such Agent's participant
account and crediting such Book-Entry Security to Chase's
participant account, and shall notify the Company and Chase
thereof. Thereafter, Chase will (i) immediately notify the
Company of such order, once Chase has confirmed that such Book-
Entry Security has been credited to its participant account, and
the Company shall transfer to such Agent funds available for
immediate use in an amount equal to the price of such Book-Entry
Security which was previously credited to the account of the
Company in accordance with Settlement Procedure I, and (ii)
deliver the withdrawal message and take the related actions
described in the preceding paragraph. If such failure shall have
occurred for any reason other than default by the Agent in the
performance of its obligations hereunder or under the
Distribution Agreement, the Company will reimburse the Agent on
an equitable basis for its loss of the use of funds during the
period when they were credited to the account of the Company;
provided, however, that the Selling Agent shall be entitled to no
reimbursement hereunder if funds are returned on the day on which
such funds had been previously credited to the account of the
Company such that the Selling Agent is afforded a reasonable
opportunity to invest such funds at an overnight rate on such
day; and provided further that if the Selling Agent is denied the
use of such funds due to its failure to return the relevant
Security to the Trustee in a timely manner it shall only be
entitled to reimbursement hereunder in an amount equal to the
amount that would have been earned on such funds had such funds
been on deposit at an overnight rate during the period between
their credit to the account of the Company and their
reimbursement to the Agent.
Notwithstanding the foregoing, upon any failure to
settle with respect to a Book-Entry Security, DTC may take any
actions in accordance with its SDFS operating procedures then in
effect. In the event of a failure to settle with respect to one
or more, but not all, of the Book-Entry Securities to have been
represented by a Global Security, the Trustee will provide, in
accordance with Settlement Procedure D for the authentication and
issuance of a Global Security representing the other Book-Entry
Securities to have been represented by such Global Security and
will make appropriate entries in its records.
ANNEX III
[FORM OF OPINION OF PAINE, HAMBLEN, COFFIN, BROOKE & MILLER]
,
-------- -- ----
Morgan Stanley & Co. Incorporated
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Salomon Brothers Inc
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
This opinion is being delivered to you pursuant to
Section of the Distribution Agreement, dated , 1998
--- ------ --
(the "Distribution Agreement"), between you as Agents and The
Washington Water Power Company, a Washington corporation (the
"Company"), relating to the issuance and sale from time to time
by the Company of up to $250,000,000 in aggregate principal
amount of its Medium-Term Notes, Series C (the "Notes"), to be
issued under an Indenture, dated as of , 1998, by and
------- --
between the Company and The Chase Manhattan Bank, as trustee (the
"Trustee").
Capitalized terms used herein but not otherwise defined
herein shall have the meaning ascribed to them in the
Distribution Agreement. The Indenture (including the Officer's
Certificate establishing the terms of the Notes) and the Notes
are sometimes collectively referred to herein as the "Company
Documents."
In connection with rendering this opinion, we have
examined, or are generally familiar with, the following: (a) the
Restated Articles of Incorporation, as amended, and the Bylaws,
as amended, of the Company; (b) the Distribution Agreement; (c)
the Company Documents; (d) a Certificate of
Existence/Authorization issued by the Secretary of State of
Washington, a Certificate of Corporate Status issued by the
Secretary of State of Idaho, a Certificate of Authorization
issued by the Secretary of State of Montana, a Certificate of
Authorization issued by the Secretary of State of Oregon, and a
Certificate of Status of Foreign Corporation issued by the
Secretary of State of California, (e) the orders of the
Washington Utilities and Transportation Commission ("WUTC"), the
California Public Utilities Commission (the "CPUC"), the Idaho
Public Utilities Commission (the "IPUC") and the Public Utility
Commission of Oregon (the "OPUC"); (f) the registration statement
(File No. 333- ) (the "Registration Statement") filed by the
-----
Company with the Securities and Exchange Commission (the "SEC")
for the registration under the Securities Act of 1933, as amended
(the "Act"), of $250,000,000 in aggregate amount of the Company's
debt securities and for qualification under the Trust Indenture
Act of 1939, as amended (the "Trust Indenture Act"), of the
Indenture, which Registration Statement, we are advised, became
effective on , 1998; (g) the final prospectus relating
------- -
to the Notes and the prospectus supplement dated , 1998,
------ --
relating to such securities and filed with the SEC pursuant to
Rule 424 under the Act; and (h) the documents incorporated by
reference in the Registration Statement, as amended by Amendment
No. 1 thereto, and the Prospectus, consisting of the Company's
Annual Report on Form 10-K for the fiscal year ended December 31,
1997 (the "10-K"), in each case, together with all exhibits
thereto (the "Incorporated Documents"). We have also examined
such other documents and satisfied ourselves as to such other
matters as we have deemed necessary in order to render this
opinion. We have not examined the certificates evidencing the
Notes, except a specimen thereof.
As to various questions of fact (but not as to the
legal conclusions contained therein) material to the opinions set
forth below, in rendering such opinions we have relied, with your
permission, upon certificates of public officials, certificates
of officers or other employees of the Company, representations
contained in the Distribution Agreement, the Company Documents
and related documents, and other oral or written assurances by
officers or other employees of the Company.
We are general counsel to the Company; general counsel
to the following subsidiaries: Avista Corp., Avista Laboratories,
Inc., Avista Advantage, Inc., WP International, Inc., Washington
Irrigation and Development Company, and WP Finance Co.; and
counsel to the following subsidiary: Avista Energy, Inc. In such
capacity, we represent the Company and such subsidiaries to which
we are general counsel on various matters referred to us by them,
but not on all matters; and we represent Avista Energy, Inc. on
certain specific matters referred to us by it (primarily with
respect to energy purchase and sale transactions), but not on all
matters and Avista Energy, Inc. has substantial engagements with
other counsel to represent it on numerous matters. We do not
serve as counsel to other direct or indirect subsidiaries and
affiliates of the Company.
We have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals, the
conformity to original documents of all documents submitted to us
as copies, and the due authorization, execution and delivery of
all documents by all parties thereto other than the Company.
We have further assumed (a) that the interest rate,
agent fee and/or effective interest cost of each Note, when
issued, will be within the limitations with respect thereto
imposed by the OPUC and by the Company's Board of Directors, (b)
that no floating rate Notes will be issued until the Company's
Board of Directors shall have authorized the same, and (c) that
Notes will be issued only during the period of authorization
specified by the OPUC.
As used in this opinion, the expression "to the best of
our knowledge" with reference to matters of fact means that,
after an examination of the documents made available to us by the
Company and after inquiries of officers or employees of the
Company, we find no reason to believe that the opinions expressed
herein are factually inaccurate; but beyond that, we have not
made an independent factual investigation for the purpose of
rendering this opinion.
Based upon the foregoing, and subject to the
qualifications set forth herein, we are of the opinion that:
(1) (a) The Company is a corporation duly
incorporated, validly existing and in good standing 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 adequate corporate powers 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 States as
described in the Registration Statement, the Prospectus and
the Incorporated Documents. The Company has adequate
corporate powers to execute and deliver, and perform its
obligations under, the Distribution Agreement and the
Company Documents.
(b) Each of the Company's following subsidiaries,
Avista Corp., Pentzer Corporation, Avista Energy, Inc.,
Avista Advantage, Inc., and Washington Irrigation &
Development Company, is a corporation duly incorporated,
validly existing and in good standing under the laws of the
State of Washington.
(2) The WUTC, CPUC, IPUC and OPUC have entered
appropriate orders authorizing the issuance and sale by the
Company of the Notes on the terms set forth or contemplated
in such orders (the "Commission Orders"); each of the
Commission Orders, to the best of our knowledge, remains in
full force and effect on the date of this opinion; and no
further approval, authorization, consent or other order of,
or filing with, any governmental agency of the States of
Washington, California, Idaho, Montana and Oregon is legally
required for the authorization of the issuance and sale by
the Company of the Notes or in order for the Company
Documents to constitute valid and binding obligations of the
Company.
(3) The Distribution Agreement and the Company
Documents (other than the Notes) have been duly authorized,
executed and delivered by the Company, and the Notes have
been duly authorized by the Company.
(4) The execution, delivery and performance by the
Company of its obligations under the Distribution Agreement
and the Company Documents, and the issuance and sale by the
Company of the Notes will not (A) breach or violate the
Company's Restated Articles of Incorporation, as amended, or
Bylaws, as amended, or (B) breach or violate, or constitute
a default under, (i) any order of any court or governmental
agency of such States having jurisdiction over the Company
or any of its properties which is material to the Company or
(ii) any contract, indenture, mortgage, agreement or other
instrument for borrowed money to which the Company is a
party or to which any of its properties is subject and which
is listed as an Exhibit to the 10-K, except that we express
no opinion as to any such contract, indenture, mortgage,
agreement or other instrument which is addressed in the
separate opinion to you of Reid & Priest LLP.
(5) Except as described in the Registration Statement,
the Prospectus or the Incorporated Documents, to the best of
our knowledge, there are no legal or governmental
proceedings, either pending or overtly threatened in
writing, which arise out of the operations of the Company in
the States of Washington, California, Idaho, Montana or
Oregon to which the Company is a party or to which the
Company or any of its properties are subject and which are
material to the Company, other than ordinary, routine legal
or governmental proceedings incidental to the kind of
business conducted by the Company.
(6) The descriptions of legal or governmental
proceedings contained in Item 8 (Note 17) of the 10-K are
fair and accurate descriptions thereof in all material
respects.
As noted above, we are general counsel to the Company
and certain of its subsidiaries and we represent them on various,
but not all, matters, and we are counsel to its subsidiary Avista
Energy, Inc. and we represent it on certain specific matters, but
not all, matters. Our involvement in the preparation of the
Registration Statement, the Prospectus and the Incorporated
Documents was limited to generally reviewing drafts thereof
prepared by the Company or other counsel to the Company and to
participating in the conferences referred to below. However, we
have not been engaged to make the ultimate determination of
materiality for purposes of, or to determine the wording and
degree of disclosure contained in, the Registration Statement,
the Prospectus or the Incorporated Documents; we have not been
engaged to advise the Company with respect to compliance with
securities laws; and we have not otherwise acted as securities
law counsel to the Company.
Accordingly, in such capacity during the course of the
preparation by the Company of the Registration Statement, the
Prospectus and the Incorporated Documents, we have participated
in conferences with certain officers and other employees of the
Company, with other counsel for the Company, with you and your
counsel, and with Deloitte & Touche LLP, the independent
certified public accountants who examined the financial
statements included in the Registration Statement, the Prospectus
and the Incorporated Documents, but we have made no independent
verification of the accuracy or completeness of the
representations and statements made to us by the Company or the
information included by the Company in the Registration
Statement, the Prospectus or the Incorporated Documents, and we
take no responsibility therefor, except as set forth in paragraph
(6) above and insofar as such information relates to us.
The nature and extent of our engagement by the Company
and our participation in the above-mentioned conferences, as
described above, would not necessarily be adequate to bring to
our attention all matters which could be deemed material or to
enable us to make a valid assessment of the materiality of such
matters as were brought to our attention or of the wording and
degree of disclosure contained in the Registration Statement, the
Prospectus or the Incorporated Documents.
However, during the course of our examination of the
Registration Statement, the Prospectus and the Incorporated
Documents and our participation in the above-mentioned
conferences, nothing came to our attention which gives us reason
to believe that, when the Registration Statement became
effective, the Registration Statement, the Prospectus and the
Incorporated Documents contained an untrue statement of a
material fact or omitted to state a material fact necessary to
make the statements therein not misleading, or that, as of the
date of this opinion, the Prospectus, as then amended or
supplemented, and the Incorporated Documents contain an untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading;
provided, however, that we do not express any belief as to any
financial statements or other financial or statistical
information, data or computations contained in the Registration
Statement, the Prospectus or the Incorporated Documents, as to
any statements contained in the Statements of Eligibility (Form
T-1) under the Trust Indenture Act with respect to the Trustee,
or as to any portions of the Registration Statement or the
Prospectus other than the sections entitled "The Washington Water
Power Company" and "Use of Proceeds" and Part II of the
Registration Statement.
The opinions expressed above are limited to the laws of
the States of Washington, California, Idaho, Montana and Oregon
(excluding therefrom principles of conflicts of laws, state
securities or blue sky laws, and laws of political subdivisions
of such States). For purposes of the opinion expressed in
paragraph (4) above, we have assumed that any document referred
to therein which is not stated to be governed by the laws of the
States of Washington, California, Idaho, Montana and Oregon would
be enforced as written.
This opinion is limited to the opinions and
confirmations expressed above, and no additional opinions or
confirmations are to be implied or inferred. Without limiting
the generality of the foregoing, it is specifically understood
that we express no opinion or confirmation as to (i) whether the
Distribution Agreement, the Company Documents or related
documents constitute legal, valid and binding obligations,
enforceable in accordance with their terms, or (ii) the
description of the Notes or related documents contained in the
Registration Statement and Prospectus.
This opinion is being delivered as of this date solely
in connection with the issuance and sale of the Notes for the
benefit of the addressees hereof. The Chase Manhattan Bank, as
Trustee under the Indenture, is hereby also authorized to rely
upon this opinion in connection therewith as if it were addressed
to it. Sullivan & Cromwell is hereby also authorized to rely
upon this opinion with respect to paragraphs (1), (2) and (3)
above in connection therewith as if it were addressed to them.
This opinion is not being delivered, nor may it be relied upon,
for any other purpose; this opinion is not being delivered for
the benefit of, nor may it be relied upon by, the holders of the
Notes or any other party to which it is not specifically
addressed or to which reliance is not expressly permitted hereby;
and this opinion is not to be used, delivered, circulated, quoted
or otherwise referred to except as expressly permitted hereby.
This opinion is given as of the date hereof, without
any obligation upon us to update this opinion or to advise the
addressees hereof or any other party of any changes in
circumstances or laws that may hereafter be brought to our
attention or occur which may affect this opinion.
Very truly yours,
PAINE, HAMBLEN, COFFIN,
BROOKE & MILLER LLP
ANNEX IV
[FORM OF OPINION OF REID & PRIEST LLP]
,
-------- -- ----
Morgan Stanley & Co. Incorporated
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Salomon Brothers Inc
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
This opinion is being delivered to you pursuant to
Section of the Distribution Agreement, dated , 1998
--- ------ --
(the "Distribution Agreement"), between you as Agents and The
Washington Water Power Company, a Washington corporation (the
"Company"), relating to the issuance and sale from time to time
by the Company of up to $250,000,000 in aggregate principal
amount of its Medium-Term Notes, Series C (the "Notes"), to be
issued under an Indenture, dated as of , 1998, by and
------- --
between the Company and The Chase Manhattan Bank, as trustee (the
"Trustee").
Capitalized terms used herein but not otherwise defined
herein shall have the meaning ascribed to them in the
Distribution Agreement. The Indenture (including the Officer's
Certificate establishing the terms of the Notes) and the Notes
are sometimes collectively referred to herein as the "Company
Documents."
In connection with rendering this opinion, we have
examined, or are generally familiar with, the following: (a) the
Restated Articles of Incorporation, as amended, and the Bylaws,
as amended, of the Company; (b) the Distribution Agreement; (c)
the Company Documents; (d) the Registration Statement for the
registration under the Securities Act of 1933, as amended (the
"Act"), of $250,000,000 in aggregate amount of the Company's debt
securities and for qualification under the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act"), of the Indenture,
which registration statement, as amended by Amendment No. 1
thereto, became effective on , 1998; (e) the Prospectus
------- -
filed with the SEC pursuant to Rule 424 under the Act; and (f)
the documents incorporated by reference into the Registration
Statement. We have also examined such other documents and
satisfied ourselves as to such other matters as we have deemed
necessary in order to render this opinion. We have not examined
the certificates evidencing the Notes, except a specimen thereof.
As to various questions of fact (but not as to the
legal conclusions contained therein) material to the opinions set
forth below, in rendering such opinions we have relied, with your
permission, upon certificates of public officials, certificates
of officers or other employees of the Company, representations of
the Company in the Distribution Agreement, and other oral or
written assurances by officers or other employees of the Company.
We do not serve as counsel to direct or indirect subsidiaries or
affiliates of the Company, and, as to various questions relating
to the activities of such subsidiaries and affiliates, we have
further relied upon certificates of officers thereof.
We have assumed, consistent with the opinion of even
date herewith rendered to you by Paine, Hamblen, Coffin, Brooke &
Miller LLP, that the Company is a corporation duly incorporated,
validly existing and in good standing under the laws of the State
of Washington and 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 adequate corporate
powers to execute and deliver the Distribution Agreement and the
Company Documents; that the Distribution Agreement and the
Company Documents (other than the Notes) have been duly
authorized, executed and delivered by the Company, and the Notes
have been duly authorized by the Company; and that all approvals,
authorizations, consents, other orders or filings required under
the laws of the States of Washington, California, Idaho, Montana
and Oregon in order for the Company Documents to constitute valid
and binding obligations of the Company have been obtained. We
have not been engaged by the Company with respect to the matters
so assumed; however, during the course of such examinations as we
have made for the purposes of the opinions enumerated below,
nothing came to our attention which leads us to believe that such
assumptions are not correct.
We have further assumed (a) that the interest rate,
agent fee and/or effective interest cost of each Note, when
issued, will be within the limitations with respect thereto
imposed by the OPUC and by the Company's Board of Directors, (b)
that no floating rate Notes will be issued until the Company's
Board of Directors shall have authorized the same, and (c) that
Notes will be issued only during the period of authorization
specified by the OPUC.
Based upon the foregoing, and subject to the
qualifications set forth herein, we are of the opinion that:
(1) the Indenture has been duly qualified under the
Trust Indenture Act and constitutes a valid and legally
binding instrument, enforceable against the Company in
accordance with its terms, except to the extent the
enforcement of the Indenture may be limited by any
applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or other laws affecting
creditors' rights generally, by general principles of equity
(whether asserted in an action in equity or at law) and by
rules of law governing specific performance, injunctive
relief, foreclosure, receivership and other equitable
remedies; and the Indenture conforms in all material
respects to the description thereof contained in the
Prospectus;
(2) the Notes, when duly authenticated and delivered
by the Trustee in accordance with the Indenture and issued,
delivered and paid for in accordance with the Distribution
Agreement, will be duly executed, authenticated, issued and
delivered and constitute valid and legally binding
obligations of the Company, in the form contemplated by and
entitled to the benefits provided by the Indenture, and
enforceable in accordance with their terms, except to the
extent the enforcement of the Notes may be limited by any
applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or other laws affecting
creditors' rights generally, by general principles of equity
(whether asserted in an action in equity or at law) and by
rules of law governing specific performance, injunctive
relief, foreclosure, receivership and other equitable
remedies; and the Notes conform in all material respects to
the description thereof contained in the Prospectus;
(3) the execution, delivery and performance by the
Company of its obligations under the Distribution Agreement
and the Company Documents and the consummation of the
transactions contemplated therein and compliance by the
Company with its obligations thereunder will not (A)
conflict with the Company's Restated Articles of
Incorporation, as amended, or Bylaws, as amended, or (B)
result in the breach or violation of any terms or provisions
of, or constitute a default under, (i) the Company's
Mortgage and Deed of Trust dated as of June 1, 1939, to
Citibank, N.A., as trustee, (ii) the Indenture, dated as of
July 1, 1988, of the Company to Chemical Bank, (iii) the
Lease Agreement, dated as of December 15, 1986, between the
Company and IRE-4 of New York, Inc. and all agreements of
the Company associated therewith, (iv) the Loan Agreement,
dated as of October 1, 1989, between the Company and the
City of Forsyth, Rosebud County, Montana, and all agreements
of the Company associated therewith, (v) the Indenture,
dated as of January 1, 1997, of the Company to Wilmington
Trust Company, (vi) the Agreement for Lease and the Lease
Agreement, each dated as of February 26, 1993, between the
Company and WP Funding, Limited Partnership, and all
agreements of the Company associated therewith, (vii) the
Amended and Restated Declaration of Trust of Washington
Water Power Capital I, dated as of January 23, 1997, or
(viii) the Amended and Restated Declaration of Trust of
Washington Water Power Capital II, dated as of June 3, 1997;
(4) no approval, authorization, consent or other order
of, or filing with, any governmental agency of the State of
New York or of the United States of America is required
under the respective laws of such jurisdictions in order for
the Company Documents to constitute valid and binding
obligations of the Company;
(5) the Company is not and, after giving effect to the
offering and sale of the Notes, will not be, an "investment
company" or an entity "controlled" by an "investment
company," as such terms are defined in the Investment
Company Act of 1940, as amended; and
(6) the Registration Statement and Prospectus (except
the financial statements and other financial and statistical
data contained therein and any information furnished to the
Company by the Agents expressly for use therein, upon which
we do not pass) comply as to form in all material respects
with the applicable requirements of the Act and the Trust
Indenture Act and the applicable instructions, rules and
regulations promulgated thereunder; the Registration
Statement has become effective under the Act and, to the
best of our knowledge, no proceedings for a stop order with
respect thereto are pending or threatened under Section 8(d)
of the Act.
We have acted as counsel to the Company primarily with
respect to general compliance with the federal securities laws
and specific financing and other corporate transactions. Our
engagement regarding such compliance was limited to advising the
Company as to the requirements of such laws and the rules and
regulations of the SEC thereunder, assisting the Company in the
assessment of the materiality of particular matters brought to
our attention and generally reviewing, with a view toward such
compliance, drafts prepared by the Company of the documents
incorporated by reference into the Registration Statement and the
Prospectus. We have not acted as general counsel to the Company
and have not, except for specific purposes, attended meetings of
the Board of Directors of the Company, or committees thereof, or
of officers of the Company; nor have we otherwise been in a
position to become aware of matters not specifically brought to
our attention by officers or other employees of, or other counsel
to, the Company.
Accordingly, in the course of the preparation by the
Company of the Registration Statement and the Prospectus, we
participated in conferences with certain officers and other
employees of the Company, with other counsel for the Company,
with you and your counsel, and with Deloitte & Touche LLP, the
independent certified public accountants who examined the
financial statements included in the Registration Statement and
the Prospectus, but we made no independent verification of the
accuracy or completeness of the representations and statements
made to us by the Company or the information included by the
Company in the Registration Statement or the Prospectus, and we
take no responsibility therefor, except insofar as such
information relates to us and as set forth in paragraphs (1) and
(2) above. In passing upon the forms of the Registration
Statement and Prospectus in paragraph (6) above, we have,
therefore, assumed the accuracy and completeness of such
representations, statements and information, except as aforesaid.
The nature and extent of our engagement by the Company
and our participation in the preparation of the Registration
Statement and the Prospectus, as described above, would not
necessarily be adequate to bring to our attention all matters
which could be deemed material or to enable us to make a valid
assessment of the materiality of such matters as were brought to
our attention.
However, during the course of our examination of the
Registration Statement and the Prospectus, and our participation
in the above-mentioned conferences, nothing came to our attention
which gives us reason to believe that (A) when the Registration
Statement became effective, the Registration Statement contained
an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make
the statements therein not misleading, or that, as of the date of
this opinion, the Prospectus, as then amended or supplemented,
contains an untrue statement of a material fact or omits to state
a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that we do not express
any belief as to any financial statements or other financial or
statistical information, data or computations contained in the
Registration Statement or the Prospectus or as to any statements
contained in the Statements of Eligibility (Form T-1) under the
Trust Indenture Act with respect to the Trustee; or (B) there
exist any material contracts which are required to be filed as
exhibits to the Registration Statement which have not been so
filed.
The opinions enumerated above are limited to the laws
of the State of New York and the federal law of the United States
of America (excluding therefrom principles of conflicts of laws
and state securities or blue sky laws). To the extent that such
opinions relate to or are dependent upon matters governed by the
laws of other States, they are based upon the assumptions set
forth above or otherwise upon the legal conclusions set forth in
the aforesaid opinions of Paine, Hamblen, Coffin, Brooke & Miller
LLP. For purposes of the opinion expressed in Paragraph 3 above,
we have assumed that any document referred to therein which is
not stated to be governed by the law of the State of New York
would be enforced as written.
The Chase Manhattan Bank, as trustee under the
Indenture, is hereby authorized to rely upon this opinion as if
it were addressed to it. This opinion is not being delivered for
the benefit of, nor may it be relied upon by, the holders of the
Notes or any other party to which it is not specifically
addressed or to which reliance is not expressly permitted
hereby.
Very truly yours,
REID & PRIEST LLP
ANNEX V
[Contents of Letter of Deloitte & Touche LLP]
The letter of Deloitte & Touche LLP will state in
effect that:
(1) They are independent certified public accountants
with respect to the Company and its subsidiaries within the
meaning of the Act and the Rules and Regulations.
(2) In their opinion, the financial statements audited
by them and incorporated by reference in the Prospectus comply as
to form in all material respects with the applicable accounting
requirements of the Act, the Exchange Act and the Rules and
Regulations.
(3) They performed the procedures specified by the
American Institute of Certified Public Accountants for a review
of interim financial information as described in SAS No. 71,
Interim Financial Information, on any unaudited condensed
consolidated financial statements included in the Company's
Quarterly Reports on Form 10-Q and incorporated by reference in
the Prospectus.
(4) On the basis of procedures referred to in such
letter, including a reading of the latest available minutes of
the Board of Directors of the Company and a reading of the latest
available interim financial statements of the Company and
inquiries of officials of the Company responsible for financial
and accounting matters, nothing caused them to believe that:
(a) the unaudited income statement and balance sheet
amounts, if any, included in the Prospectus were not
determined on a basis substantially consistent with that of
the corresponding amounts in the audited financial
statements incorporated by reference in the Prospectus;
(b) the unaudited condensed consolidated financial
statements included in the Company's Quarterly Reports on
Form 10-Q, if any, incorporated by reference in the
Prospectus do not comply as to form in all material respects
with the applicable accounting requirements of the Exchange
Act and the related published rules and regulations
thereunder applicable to reports on Form 10-Q or are not in
conformity with generally accepted accounting principles on
a basis substantially consistent with that of the audited
financial statements incorporated by reference in the
Prospectus;
(c) at the date of the latest available internal
balance sheet of the Company, there was any change in the
capital stock, notes payable or long-term debt or any
decrease in the net assets or shareholders' equity of the
Company, or, at a subsequent specified date not more than
five days prior to the date of such letter, there was a
change in the capital stock, notes payable or long-term debt
of the Company, in each case as compared with the amounts
shown in the most recent balance sheet of the Company
incorporated by reference in the Prospectus, except for 1.
increases in capital stock resulting from the issuance of
shares pursuant to employee benefit plans and the Company's
Dividend Reinvestment and Stock Purchase Plan, 2. decrease
in long-term debt resulting from amortization of debt
premium or increases in long-term debt premium or increases
in long-term debt resulting from draw-downs of funds held in
trust, 3. decreases in net assets resulting from the
declaration of dividends, 4. changes or decreases which the
Prospectus discloses have occurred or may occur and 5. such
other changes or decreases as may be set forth in such
letter; or
(d) at the date of the latest available internal
balance sheet of the Company, there was any decrease, as
compared with the most recent twelve-month period for which
operating revenues and net income are included or
incorporated by reference in the Prospectus, in such
amounts, except in all cases for changes or decreases which
the Prospectus discloses have occurred or may occur or as
may be set forth in set letter.
(5) In addition to their examination referred to in
their report in the Registration Statement and Prospectus and the
procedures referred to in (3) above, they have carried out
certain other specified procedures, not constituting an audit,
with respect to the dollar amounts, percentages and other
financial information, (in each case to the extent that such
dollar amounts, percentages and other financial information,
either directly or by analysis or computation, are derived from
the general accounting records of the Company) which appear in
the Company's annual report on Form 10-K for its most recent
fiscal year in Item 1, "Business", Item 6, "Selected Financial
Data" and Item 7 "Managements's Discussion and Analysis of
Financial Condition and Results of Operations" and have found
such dollar amounts, percentages and financial information to be
in agreement with the accounting records of the Company.
--------------------------------------
THE WASHINGTON WATER POWER COMPANY
TO
THE CHASE MANHATTAN BANK,
TRUSTEE
-----------
INDENTURE
DATED AS OF _________ 1, 1998
-----------
--------------------------------------
THE WASHINGTON WATER POWER COMPANY
RECONCILIATION AND TIE BETWEEN TRUST INDENTURE ACT OF 1939 AND
INDENTURE, DATED AS OF ___________ __, 1998
----------------------------------------------------------------
TRUST INDENTURE ACT SECTION INDENTURE SECTION(S)
--------------------------- --------------------
Section 310(a)(1) . . . . . . . . . . . . . . . . 809
(a)(2) . . . . . . . . . . . . . . . . 809
(a)(3) . . . . . . . . . . . . . . . . Not Applicable
(a)(4) . . . . . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . . . . . . 808, 810
Section 311(a) . . . . . . . . . . . . . . . . . 813
(b) . . . . . . . . . . . . . . . . . 813
(c) . . . . . . . . . . . . . . . . . 813
Section 312(a) . . . . . . . . . . . . . . . . . 901
(b) . . . . . . . . . . . . . . . . . 901
(c) . . . . . . . . . . . . . . . . . 901
Section 313(a) . . . . . . . . . . . . . . . . . 902
(b) . . . . . . . . . . . . . . . . . 902
(c) . . . . . . . . . . . . . . . . . 902
(d) . . . . . . . . . . . . . . . . . 902
Section 314(a) . . . . . . . . . . . . . . . . . 902, 507
(b) . . . . . . . . . . . . . . . . . Not Applicable
(c)(1) . . . . . . . . . . . . . . . . 102
(c)(2) . . . . . . . . . . . . . . . . 102
(c)(3) . . . . . . . . . . . . . . . . Not Applicable
(d) . . . . . . . . . . . . . . . . . Not Applicable
(e) . . . . . . . . . . . . . . . . . 102
Section 315(a) . . . . . . . . . . . . . . . . . 801, 803
(b) . . . . . . . . . . . . . . . . . 802
(c) . . . . . . . . . . . . . . . . . 801
(d) . . . . . . . . . . . . . . . . . 801
(e) . . . . . . . . . . . . . . . . . 714
Section 316(a) . . . . . . . . . . . . . . . . . 712, 713
(a)(1)(A) . . . . . . . . . . . . . . 702, 712
(a)(1)(B) . . . . . . . . . . . . . . 713
(a)(2) . . . . . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . . . . . . 708
(c) . . . . . . . . . . . . . . . . . 104
Section 317(a)(1) . . . . . . . . . . . . . . . . 703
(a)(2) . . . . . . . . . . . . . . . . 705
(b) . . . . . . . . . . . . . . . . . 503
Section 318(a) . . . . . . . . . . . . . . . . . 107
TABLE OF CONTENTS
-----------------
PAGE
----
Recital of the Company . . . . . . . . . . . . . . . . . . . . 1
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. General Definitions . . . . . . . . . . . . 1
Act . . . . . . . . . . . . . . . . . . . . . . . 2
Affiliate . . . . . . . . . . . . . . . . . . . . 2
Authenticating Agent . . . . . . . . . . . . . . 2
Authorized Officer . . . . . . . . . . . . . . . 2
Board of Directors . . . . . . . . . . . . . . . 2
Board Resolution . . . . . . . . . . . . . . . . 2
Business Day . . . . . . . . . . . . . . . . . . 3
Commission . . . . . . . . . . . . . . . . . . . 3
Company . . . . . . . . . . . . . . . . . . . . . 3
Company Order or Company Request . . . . . . . . 3
Corporate Trust Office . . . . . . . . . . . . . 3
corporation . . . . . . . . . . . . . . . . . . . 3
Discount Security . . . . . . . . . . . . . . . . 3
Interest . . . . . . . . . . . . . . . . . . . 3
Dollar or $ . . . . . . . . . . . . . . . . . . . 3
Eligible Obligations . . . . . . . . . . . . . . 3
Event of Default . . . . . . . . . . . . . . . . 4
Fair Value . . . . . . . . . . . . . . . . . . . 4
Governmental Authority . . . . . . . . . . . . . 4
Government Obligations . . . . . . . . . . . . . 4
Holder . . . . . . . . . . . . . . . . . . . . . 4
Indenture . . . . . . . . . . . . . . . . . . . . 4
Independent Expert's Certificate . . . . . . . . 4
Interest Payment Date . . . . . . . . . . . . . . 5
Maturity . . . . . . . . . . . . . . . . . . . . 5
Notice of Default . . . . . . . . . . . . . . . . 5
Officer's Certificate . . . . . . . . . . . . . . 5
Opinion of Counsel . . . . . . . . . . . . . . . 5
Outstanding . . . . . . . . . . . . . . . . . . . 5
Paying Agent . . . . . . . . . . . . . . . . . . 6
Periodic Offering . . . . . . . . . . . . . . . . 6
Person . . . . . . . . . . . . . . . . . . . . . 6
Place of Payment . . . . . . . . . . . . . . . . 6
Predecessor Security . . . . . . . . . . . . . . 7
Redemption Date . . . . . . . . . . . . . . . . . 7
Redemption Price . . . . . . . . . . . . . . . . 7
Regular Record Date . . . . . . . . . . . . . . . 7
Required Currency . . . . . . . . . . . . . . . . 7
Responsible Officer . . . . . . . . . . . . . . . 7
Securities . . . . . . . . . . . . . . . . . . . 7
Security Register . . . . . . . . . . . . . . . . 7
Security Registrar . . . . . . . . . . . . . . . 7
Special Record Date . . . . . . . . . . . . . . . 7
Stated Interest Rate . . . . . . . . . . . . . . 7
Stated Maturity . . . . . . . . . . . . . . . . . 7
Successor . . . . . . . . . . . . . . . . . . . . 8
Tranche . . . . . . . . . . . . . . . . . . . . . 8
Trust Indenture Act . . . . . . . . . . . . . . . 8
Trustee . . . . . . . . . . . . . . . . . . . . . 8
United States . . . . . . . . . . . . . . . . . . 8
Unpaid Interest . . . . . . . . . . . . . . . . . 8
SECTION 102. Compliance Certificates and Opinions . . . . 8
SECTION 103. Content and Form of Documents Delivered to
Trustee . . . . . . . . . . . . . . . . . . 9
SECTION 104. Acts of Holders . . . . . . . . . . . . . . 10
SECTION 105. Notices, Etc. to Trustee and Company . . . . 12
SECTION 106. Notice to Holders of Securities; Waiver . . 12
SECTION 107. Conflict with Trust Indenture Act . . . . . 13
SECTION 108. Effect of Headings and Table of Contents . . 13
SECTION 109. Successors and Assigns . . . . . . . . . . . 13
SECTION 110. Separability Clause . . . . . . . . . . . . 13
SECTION 111. Benefits of Indenture . . . . . . . . . . . 13
SECTION 112. Governing Law . . . . . . . . . . . . . . . 14
SECTION 113. Legal Holidays . . . . . . . . . . . . . . . 14
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally . . . . . . . . . . . . . . 14
SECTION 202. Form of Trustee's Certificate of
Authentication . . . . . . . . . . . . . . . 15
ARTICLE THREE
THE SECURITIES
SECTION 301. Amount Unlimited; Issuable in Series . . . . 15
SECTION 302. Denominations . . . . . . . . . . . . . . . 19
SECTION 303. Execution, Dating,
Certificate of Authentication . . . . . . . 19
SECTION 304. Temporary Securities . . . . . . . . . . . . 22
SECTION 305. Registration, Registration of Transfer
and Exchange . . . . . . . . . . . . . . . . 22
SECTION 306. Mutilated, Destroyed, Lost
and Stolen Securities . . . . . . . . . . . 24
SECTION 307. Payment of Interest; Interest
Rights Preserved . . . . . . . . . . . . . . 25
SECTION 308. Persons Deemed Owners . . . . . . . . . . . 26
SECTION 309. Cancellation by Security Registrar . . . . . 26
SECTION 310. Computation of Interest . . . . . . . . . . 27
SECTION 311. Payment to Be in Proper Currency . . . . . . 27
ARTICLE FOUR
REDEMPTION OF SECURITIES
SECTION 401. Applicability of Article . . . . . . . . . . 27
SECTION 402. Election to Redeem; Notice to Trustee . . . 27
SECTION 403. Selection of Securities to Be Redeemed . . . 28
SECTION 404. Notice of Redemption . . . . . . . . . . . . 28
SECTION 405. Securities Payable on Redemption Date . . . 30
SECTION 406. Securities Redeemed in Part . . . . . . . . 30
ARTICLE FIVE
COVENANTS
SECTION 501. Payment of Securities. . . . . . . . . . . . 30
SECTION 502. Maintenance of Office or Agency . . . . . . 31
SECTION 503. Money for Securities Payments to Be
Held in Trust . . . . . . . . . . . . . . . 31
SECTION 504. Corporate Existence . . . . . . . . . . . . 33
SECTION 505. Maintenance of Properties . . . . . . . . . 33
SECTION 506. Waiver of Certain Covenants . . . . . . . . 33
SECTION 507. Annual Officer's Certificate
as to Compliance. . . . . . . . . . . . . . 34
ARTICLE SIX
SATISFACTION AND DISCHARGE
SECTION 601. Satisfaction and Discharge of Securities . . 34
SECTION 602. Satisfaction and Discharge of Indenture . . 37
SECTION 603. Application of Trust Money . . . . . . . . . 37
ARTICLE SEVEN
EVENTS OF DEFAULT; REMEDIES
SECTION 701. Events of Default . . . . . . . . . . . . . 38
SECTION 702. Acceleration of Maturity; Rescission and
Annulment . . . . . . . . . . . . . . . . . 40
SECTION 703. Collection of Indebtedness and Suits for
Enforcement by Trustee . . . . . . . . . . . 41
SECTION 704. Application of Money Collected . . . . . . . 42
SECTION 705. Trustee May File Proofs of Claim . . . . . . 42
SECTION 706. Trustee May Enforce Claims without
Possession of Securities . . . . . . . . . . 43
SECTION 707. Limitation on Suits . . . . . . . . . . . . 43
SECTION 708. Unconditional Right of Holders
to Receive Principal,
Premium and Interest . . . . . . . . . . . . 44
SECTION 709. Restoration of Rights and Remedies . . . . . 44
SECTION 710. Rights and Remedies Cumulative . . . . . . . 44
SECTION 711. Delay or Omission Not Waiver . . . . . . . . 45
SECTION 712. Control by Holders of Securities . . . . . . 45
SECTION 713. Waiver of Past Defaults . . . . . . . . . . 45
SECTION 714. Undertaking for Costs . . . . . . . . . . . 46
SECTION 715. Waiver of Stay or Extension Laws . . . . . . 46
ARTICLE EIGHT
THE TRUSTEE
SECTION 801. Certain Duties and Responsibilities . . . . 47
SECTION 802. Notice of Defaults . . . . . . . . . . . . . 48
SECTION 803. Certain Rights of Trustee . . . . . . . . . 48
SECTION 804. Not Responsible for Recitals or
Issuance of Securities . . . . . . . . . . . 50
SECTION 805. May Hold Securities . . . . . . . . . . . . 50
SECTION 806. Money Held in Trust . . . . . . . . . . . . 50
SECTION 807. Compensation and Reimbursement . . . . . . . 50
SECTION 808. Disqualification; Conflicting Interests . . 51
SECTION 809. Corporate Trustee Required; Eligibility . . 51
SECTION 810. Resignation and Removal;
Appointment of Successor . . . . . . . . . . 52
SECTION 811. Acceptance of Appointment by Successor . . . 54
SECTION 812. Merger, Conversion, Consolidation
or Succession to Business . . . . . . . . . 55
SECTION 813. Preferential Collection of Claims
against Company . . . . . . . . . . . . . . 55
SECTION 814. Appointment of Authenticating Agent . . . . 56
ARTICLE NINE
LISTS OF HOLDERS; REPORTS BY TRUSTEE AND COMPANY
SECTION 901. Lists of Holders . . . . . . . . . . . . . . 58
SECTION 902. Reports by Trustee and Company . . . . . . . 58
ARTICLE TEN
CONSOLIDATION, MERGER, CONVEYANCE
OR OTHER TRANSFER
SECTION 1001. Company may Consolidate, etc., Only on
Certain Terms . . . . . . . . . . . . . . . 59
SECTION 1002. Successor Substituted . . . . . . . . . . . 60
SECTION 1003. Release of Company upon Conveyance
or Other Transfer . . . . . . . . . . . . . 60
SECTION 1004. Merger into Company . . . . . . . . . . . . 60
SECTION 1005. Transfer of Less than the Entirety . . . . 60
ARTICLE ELEVEN
SUPPLEMENTAL INDENTURES
SECTION 1101. Supplemental Indentures without
Consent of Holders . . . . . . . . . . . . 63
SECTION 1102. Supplemental Indentures with
Consent of Holders . . . . . . . . . . . . 65
SECTION 1103. Execution of Supplemental Indentures . . . 66
SECTION 1104. Effect of Supplemental Indentures . . . . . 67
SECTION 1105. Conformity with Trust Indenture Act . . . . 67
SECTION 1106. Reference in Securities to
Supplemental Indentures . . . . . . . . . . 67
SECTION 1107. Modification without Supplemental
Indenture . . . . . . . . . . . . . . . . . 67
ARTICLE TWELVE
MEETINGS OF HOLDERS; ACTION WITHOUT MEETING
SECTION 1201. Purposes for Which Meetings May Be Called. 68
SECTION 1202. Call, Notice and Place of Meetings . . . . 68
SECTION 1203. Persons Entitled to Vote at Meetings . . . 69
SECTION 1204. Quorum; Action . . . . . . . . . . . . . . 69
SECTION 1205. Attendance at Meetings; Determination
of Voting Rights;
Conduct and Adjournment of Meetings . . . . 70
SECTION 1206. Counting Votes and Recording
Action of Meetings . . . . . . . . . . . . 71
SECTION 1207. Action without Meeting . . . . . . . . . . 71
ARTICLE THIRTEEN
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS
AND DIRECTORS
SECTION 1301. Liability Solely Corporate . . . . . . . . 72
Signatures . . . . . . . . . . . . . . . . . . . . . . . . 73
INDENTURE, dated as of __________ 1, 1998 between THE
WASHINGTON WATER POWER COMPANY, a corporation organized and
existing under the laws of the State of Washington (hereinafter
sometimes called the "Company"), and The Chase Manhattan Bank, a
New York banking corporation, trustee (hereinafter sometimes called
the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and
delivery of this Indenture to provide for the issuance from time to
time of unsecured debentures, notes or other evidences of
indebtedness (herein called the "Securities"), to be issued in one
or more series as contemplated herein; all acts necessary to make
this Indenture a valid agreement of the Company have been
performed.
NOW, THEREFORE, THIS INDENTURE WITNESSETH that, in
consideration of the premises and of the purchase of the Securities
by the Holders thereof, it is hereby covenanted and agreed by and
between the Company and the Trustee that all the Securities are to
be authenticated and delivered subject to the further covenants,
conditions and trusts hereinafter set forth, and the Company hereby
covenants and agrees to and with the Trustee, for the equal and
ratable benefit of all Holders of the Securities or of series
thereof (except as otherwise contemplated herein), as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. GENERAL DEFINITIONS.
For all purposes of this Indenture, except as
otherwise expressly provided or unless the context otherwise
requires:
(a) the terms defined in this Article have
the meanings assigned to them in this Article and
include the plural as well as the singular;
(b) all terms used herein without definition
which are defined in the Trust Indenture Act, either
directly or by reference therein, have the meanings
assigned to them therein;
(c) all terms used herein without definition
which are defined in the Uniform Commercial Code as
in effect in any jurisdiction in which any property
of the Company is located shall have the meanings
assigned to them therein with respect to such
property;
(d) all accounting terms not otherwise
defined herein have the meanings assigned to them in
accordance with generally accepted accounting
principles in the United States; and, except as
otherwise herein expressly provided, the term
"generally accepted accounting principles" with
respect to any computation required or permitted
hereunder shall mean such accounting principles as
are generally accepted in the United States at the
date of such computation or, at the election of the
Company from time to time, at the date of the
execution and delivery of this Indenture; provided,
however, that in determining generally accepted
accounting principles applicable to the Company,
effect shall be given, to the extent required, to any
order, rule or regulation of any administrative
agency, regulatory authority or other governmental
body having jurisdiction over the Company; and
(e) the words "herein", "hereof" and
"hereunder" and other words of similar import refer
to this Indenture as a whole and not to any
particular Article, Section or other subdivision.
"ACT", when used with respect to any Holder of a
Security, has the meaning specified in Section 104.
"AFFILIATE" of any specified Person means any other
Person directly or indirectly controlling or controlled by or under
direct or indirect common control with such specified Person. For
the purposes of this definition, "CONTROL" when used with respect
to any specified Person means the power to direct generally the
management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or
otherwise; and the terms "CONTROLLING" and "CONTROLLED" have
meanings correlative to the foregoing.
"AUTHENTICATING AGENT" means any Person (other than
the Company or an Affiliate of the Company) authorized by the
Trustee to act on behalf of the Trustee to authenticate the
Securities of one or more series.
"AUTHORIZED OFFICER" means the Chairman of the Board,
the President, any Vice President, the Treasurer or the Corporate
Secretary or any other duly authorized officer, agent or attorney-
in-fact of the Company named in an Officer's Certificate signed by
any of such corporate officers.
"BOARD OF DIRECTORS" means either the board of
directors of the Company or any committee thereof duly authorized
to act in respect of matters relating to this Indenture.
"BOARD RESOLUTION" means a copy of a resolution
certified by the Corporate Secretary or an Assistant Corporate
Secretary of the Company to have been duly adopted by the Board of
Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"BUSINESS DAY", when used with respect to a Place of
Payment or any other particular location specified in the
Securities or this Indenture, means any day, other than a Saturday
or Sunday, which is not a day on which banking institutions or
trust companies in such Place of Payment or other location are
generally authorized or required by law, regulation or executive
order to remain closed, except as may be otherwise specified as
contemplated by Section 301.
"COMMISSION" means the Securities and Exchange
Commission, as from time to time constituted, created under the
Securities Exchange Act of 1934, as amended, or, if at any time
after the date of the execution and delivery of this Indenture such
Commission is not existing and performing the duties now assigned
to it under the Trust Indenture Act, then the body, if any, per-
forming such duties at such time.
"COMPANY" means the Person named as the "Company" in
the first paragraph of this Indenture until a successor Person
shall have become such pursuant to the applicable provisions of
this Indenture, and thereafter "Company" shall mean such successor
Person.
"COMPANY ORDER" or "COMPANY REQUEST" means a written
request or order signed in the name of the Company by an Authorized
Officer and delivered to the Trustee.
"CORPORATE TRUST OFFICE" means the office of the
Trustee at which at any particular time its corporate trust
business shall be principally administered, which office at the
date of the execution and delivery of this Indenture is located at
450 West 33rd Street, New York, New York 10001.
"CORPORATION" means a corporation, association,
company, joint stock company or business trust.
"DISCOUNT SECURITY" means any Security which provides
for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the Maturity thereof
pursuant to Section 702. "INTEREST" with respect to a Discount
Security means interest, if any, borne by such Security at a Stated
Interest Rate.
"DOLLAR" or "$" means a dollar or other equivalent
unit in such coin or currency of the United States as at the time
shall be legal tender for the payment of public and private debts.
"ELIGIBLE OBLIGATIONS" means:
(a) with respect to Securities denominated
in Dollars, Government Obligations; or
(b) with respect to Securities denominated
in a currency other than Dollars or in a composite
currency, such other obligations or instruments as
shall be specified with respect to such Securities as
contemplated by Section 301.
"EVENT OF DEFAULT" has the meaning specified in
Section 701.
"FAIR VALUE" has the meaning specified in Section
1005.
"GOVERNMENTAL AUTHORITY" means the government of the
United States or of any State or Territory thereof or of the
District of Columbia or of any county, municipality or other
political subdivision of any thereof, or any department, agency,
authority or other instrumentality of any of the foregoing.
"GOVERNMENT OBLIGATIONS" means:
(a) direct obligations of, or obligations
the principal of and interest on which are
unconditionally guaranteed by, the United States
entitled to the benefit of the full faith and credit
thereof; and
(b) certificates, depositary receipts or
other instruments which evidence a direct ownership
interest in obligations described in clause (a) above
or in any specific interest or principal payments due
in respect thereof; provided, however, that the
custodian of such obligations or specific interest or
principal payments shall be a bank or trust company
(which may include the Trustee or any Paying Agent)
subject to Federal or State supervision or
examination with a combined capital and surplus of at
least Fifty Million Dollars ($50,000,000); and
provided, further, that except as may be otherwise
required by law, such custodian shall be obligated to
pay to the holders of such certificates, depositary
receipts or other instruments the full amount
received by such custodian in respect of such
obligations or specific payments and shall not be
permitted to make any deduction therefrom.
"HOLDER" means a Person in whose name a Security is
registered in the Security Register.
"INDENTURE" means this instrument as originally
executed and delivered and as it may from time to time be amended
and/or supplemented by one or more indentures or other instruments
supplemental hereto entered into pursuant to the applicable
provisions hereof and shall include the terms of particular series
of Securities established as contemplated by Section 301.
"INDEPENDENT EXPERT'S CERTIFICATE" has the meaning
specified in Section 1005.
"INTEREST PAYMENT DATE", when used with respect to
any Security, means the Stated Maturity of an installment of
interest on such Security.
"MATURITY", when used with respect to any Security,
means the date on which the principal of such Security or an
installment of principal becomes due and payable as provided in
such Security or in this Indenture, whether at the Stated Maturity,
by declaration of acceleration, upon call for redemption or
otherwise.
"NOTICE OF DEFAULT" has the meaning specified in
Section 701.
"OFFICER'S CERTIFICATE" means a certificate signed by
an Authorized Officer and delivered to the Trustee.
"OPINION OF COUNSEL" means a written opinion of
counsel, who may be counsel for the Company or other counsel
acceptable to the Trustee and who may be an employee or Affiliate
of the Company.
"OUTSTANDING", when used with respect to Securities,
means, as of the date of determination, all Securities theretofore
authenticated and delivered under this Indenture, except:
(a) Securities theretofore canceled or
delivered to the Trustee for cancellation;
(b) Securities deemed to have been paid for
all purposes of this Indenture in accordance with
Section 601 (whether or not the Company's
indebtedness in respect thereof shall be satisfied
and discharged for any other purpose); and
(c) Securities which have been paid pursuant
to Section 306 or in exchange for or in lieu of which
other Securities have been authenticated and
delivered pursuant to this Indenture, other than any
such Securities in respect of which there shall have
been presented to the Trustee proof satisfactory to
it and the Company that such Securities are held by a
bona fide purchaser or purchasers in whose hands such
Securities are valid obligations of the Company;
provided, however, that in determining whether or not the Holders
of the requisite principal amount of the Securities Outstanding
under this Indenture, or the Outstanding Securities of any series
or Tranche, have given or made any request, demand, authorization,
direction, notice, consent or waiver hereunder or whether or not a
quorum is present at a meeting of Holders of Securities,
(x) Securities owned by the Company or any
other obligor upon the Securities or any Affiliate of
the Company or of such other obligor (unless the
Company, such obligor or such Affiliate owns all
Securities Outstanding under this Indenture, or all
Outstanding Securities of each such series and each
such Tranche, as the case may be, determined without
regard to this clause (x)) shall be disregarded and
deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in
relying upon any such request, demand, authorization,
direction, notice, consent or waiver or upon any such
determination as to the presence of a quorum, only
Securities which the Trustee knows to be so owned
shall be so disregarded; provided, however, that
Securities so owned which have been pledged in good
faith may be regarded as Outstanding if it is
established to the reasonable satisfaction of the
Trustee that the pledgee, and not the Company, any
such other obligor or Affiliate of either thereof,
has the right so to act with respect to such
Securities and that the pledgee is not the Company or
any other obligor upon the Securities or any
Affiliate of the Company or of such other obligor;
and
(y) the principal amount of a Discount
Security that shall be deemed to be Outstanding for
such purposes shall be the amount of the principal
thereof that would be due and payable as of the date
of such determination upon a declaration of
acceleration of the Maturity thereof pursuant to
Section 702; and
provided, further, that, in the case of any Security the principal
of which is payable from time to time without presentment or
surrender, the principal amount of such Security that shall be
deemed to be Outstanding at any time for all purposes of this
Indenture shall be the original principal amount thereof less the
aggregate amount of principal thereof theretofore paid.
"PAYING AGENT" means any Person, including the
Company, authorized by the Company to pay the principal of and
premium, if any, or interest, if any, on any Securities on behalf
of the Company.
"PERIODIC OFFERING" means an offering of Securities
of a series from time to time any or all of the specific terms of
which Securities, including without limitation the rate or rates of
interest, if any, thereon, the Stated Maturity or Maturities
thereof and the redemption provisions, if any, with respect
thereto, are to be determined by the Company or its agents from
time to time subsequent to the initial request for the
authentication and delivery of such Securities by the Trustee, all
as contemplated in Section 301 and clause (b) of Section 303.
"PERSON" means any individual, corporation,
partnership, limited liability partnership, limited liability
company, joint venture, trust or unincorporated organization or any
Governmental Authority.
"PLACE OF PAYMENT", when used with respect to the
Securities of any series, or any Tranche thereof, means the place
or places, specified as contemplated by Section 301, at which,
subject to Section 502, principal of and premium, if any, and
interest, if any, on the Securities of such series or Tranche are
payable.
"PREDECESSOR SECURITY" of any particular Security
means every previous Security evidencing all or a portion of the
same debt as that evidenced by such particular Security; and, for
the purposes of this definition, any Security authenticated and
delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed (to
the extent lawful) to evidence the same debt as the mutilated,
destroyed, lost or stolen Security.
"REDEMPTION DATE", when used with respect to any
Security to be redeemed, means the date fixed for such redemption
by or pursuant to this Indenture.
"REDEMPTION PRICE", when used with respect to any
Security to be redeemed, means the price at which it is to be
redeemed pursuant to this Indenture.
"REGULAR RECORD DATE" for the interest payable on any
Interest Payment Date on the Securities of any series means the
date specified for that purpose as contemplated by Section 301.
"REQUIRED CURRENCY" has the meaning specified in
Section 311.
"RESPONSIBLE OFFICER", when used with respect to the
Trustee, means any officer of the Trustee assigned by the Trustee
to administer its corporate trust matters.
"SECURITIES" means any bonds, notes and other
evidences of indebtedness authenticated and delivered under this
Indenture.
"SECURITY REGISTER" and "SECURITY REGISTRAR" have the
respective meanings specified in Section 305.
"SPECIAL RECORD DATE" for the payment of any Unpaid
Interest on the Securities of any series means a date fixed by the
Trustee pursuant to Section 307.
"STATED INTEREST RATE" means a rate (whether fixed or
variable) at which an obligation by its terms is stated to bear
simple interest. Any calculation or other determination to be made
under this Indenture by reference to the Stated Interest Rate on an
obligation shall be made (a) if the Company's obligations in
respect of any other indebtedness shall be evidenced or secured in
whole or in part by such obligation, by reference to the lower of
the Stated Interest Rate on such obligation and the Stated Interest
Rate on such other indebtedness and (b) without regard to the
effective interest cost to the Company of such obligation or of any
such other indebtedness.
"STATED MATURITY", when used with respect to any
obligation or any installment of principal thereof or interest
thereon, means the date on which the principal of such obligation
or such installment of principal or interest is stated to be due
and payable (without regard to any provisions for redemption,
prepayment, acceleration, purchase or extension).
"SUCCESSOR" has the meaning set forth in Section
1001.
"TRANCHE" means a group of Securities which (a) are
of the same series and (b) have identical terms except as to
principal amount and/or date of issuance.
"TRUST INDENTURE ACT" means, as of any time, the
Trust Indenture Act of 1939, or any successor statute, as in effect
at such time.
"TRUSTEE" means the Person named as the "Trustee" in
the first paragraph of this Indenture until a successor trustee
shall have become such with respect to one or more series of
Securities pursuant to the applicable provisions of this Indenture,
and thereafter "Trustee" shall mean or include each Person who is
then a Trustee hereunder, and, if at any time there is more than
one Person acting as trustee hereunder, "Trustee" shall mean each
such Person so acting.
"UNITED STATES" means the United States of America,
its Territories, its possessions and other areas subject to its
political jurisdiction.
"UNPAID INTEREST" has the meaning specified in
Section 307.
SECTION 102. COMPLIANCE CERTIFICATES AND OPINIONS.
Except as otherwise expressly provided in this
Indenture, upon any application or request by the Company to the
Trustee to take any action under any provision of this Indenture,
the Company shall furnish to the Trustee an Officer's Certificate
stating that all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with
and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied
with, it being understood that in the case of any such application
or request as to which the furnishing of such documents is speci-
fically required by any provision of this Indenture relating to
such particular application or request, no additional certificate
or opinion need be furnished.
Every certificate or opinion with respect to
compliance with a condition or covenant provided for in this
Indenture shall include:
(a) a statement that each individual signing
such certificate or opinion has read such covenant or
condition and the definitions herein relating
thereto;
(b) a brief statement as to the nature and
scope of the examination or investigation upon which
the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of each
such individual, such individual has made such
examination or investigation as is necessary to
enable such individual to express an informed opinion
as to whether or not such covenant or condition has
been complied with; and
(d) a statement as to whether, in the
opinion of each such individual, such condition or
covenant has been complied with.
SECTION 103. CONTENT AND FORM OF DOCUMENTS DELIVERED TO TRUSTEE.
(a) Any Officer's Certificate may be based
(without further examination or investigation), insofar as it
relates to or is dependent upon legal matters, upon an opinion of,
or representations by, counsel, unless, in any case, such officer
has actual knowledge that the certificate or opinion or
representations with respect to the matters upon which such
Officer's Certificate may be based as aforesaid are erroneous.
Any Opinion of Counsel may be based (without further
examination or investigation), insofar as it relates to or is
dependent upon factual matters, information with respect to which
is in the possession of the Company, upon a certificate of, or
representations by, an officer or officers of the Company, unless
such counsel has actual knowledge that the certificate or opinion
or representations with respect to the matters upon which his
opinion may be based as aforesaid are erroneous. In addition, any
Opinion of Counsel may be based (without further examination or
investigation), insofar as it relates to or is dependent upon
matters covered in an Opinion of Counsel rendered by other counsel,
upon such other Opinion of Counsel, unless such counsel has actual
knowledge that the Opinion of Counsel rendered by such other
counsel with respect to the matters upon which his Opinion of
Counsel may be based as aforesaid are erroneous. If, in order to
render any Opinion of Counsel provided for herein, the signer
thereof shall deem it necessary that additional facts or matters be
stated in any Officer's Certificate provided for herein, then such
certificate may state all such additional facts or matters as the
signer of such Opinion of Counsel may request.
(b) In any case where several matters are
required to be certified by, or covered by an opinion of, any
specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person,
or that they be so certified or covered by only one document, but
one such Person may certify or give an opinion with respect to some
matters and one or more other such Persons as to other matters, and
any such Person may certify or give an opinion as to such matters
in one or several documents. Where any Person is required to make,
give or execute two or more applications, requests, consents,
certificates, statements, opinions or other instruments under this
Indenture, they may, but need not, be consolidated and form one
instrument.
(c) Whenever, subsequent to the receipt by
the Trustee of any Board Resolution, Officer's Certificate, Opinion
of Counsel or other document or instrument, a clerical,
typographical or other inadvertent or unintentional error or
omission shall be discovered therein, a new document or instrument
may be substituted therefor in corrected form with the same force
and effect as if originally filed in the corrected form and,
irrespective of the date or dates of the actual execution and/or
delivery thereof, such substitute document or instrument shall be
deemed to have been executed and/or delivered as of the date or
dates required with respect to the document or instrument for which
it is substituted. Anything in this Indenture to the contrary
notwithstanding, if any such corrective document or instrument
indicates that action has been taken by or at the request of the
Company which could not have been taken had the original document
or instrument not contained such error or omission, the action so
taken shall not be invalidated or otherwise rendered ineffective
but shall be and remain in full force and effect, except to the
extent that such action was a result of willful misconduct or bad
faith. Without limiting the generality of the foregoing, any
Securities issued under the authority of such defective document or
instrument shall nevertheless be the valid obligations of the
Company entitled to the benefits provided by this Indenture equally
and ratably with all other Outstanding Securities, except as
aforesaid.
SECTION 104. ACTS OF HOLDERS.
(a) Any request, demand, authorization,
direction, notice, consent, election, waiver or other action
provided by this Indenture to be made, given or taken by Holders
may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by
an agent duly appointed in writing or, alternatively, may be
embodied in and evidenced by the record of Holders voting in favor
thereof, either in person or by proxies duly appointed in writing,
at any meeting of Holders duly called and held in accordance with
the provisions of Article Twelve, or a combination of such
instruments and any such record. Except as herein otherwise
expressly provided, such action shall become effective when such
instrument or instruments or record or both are delivered to the
Trustee and, where it is hereby expressly required, to the Company.
Such instrument or instruments and any such record (and the action
embodied therein and evidenced thereby) are herein sometimes
referred to as the "ACT" of the Holders signing such instrument or
instruments and so voting at any such meeting. Proof of execution
of any such instrument or of a writing appointing any such agent,
or of the holding by any Person of a Security, shall be sufficient
for any purpose of this Indenture and (subject to Section 801)
conclusive in favor of the Trustee and the Company, if made in the
manner provided in this Section. The record of any meeting of
Holders shall be proved in the manner provided in Section 1206.
(b) The fact and date of the execution by
any Person of any such instrument or writing may be proved by the
affidavit of a witness of such execution or by a certificate of a
notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution
thereof or may be proved in any other manner which the Trustee and
the Company deem sufficient. Where such execution is by a signer
acting in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of
his authority.
(c) The ownership of Securities, the
principal amount (except as otherwise contemplated in clause (y) of
the first proviso to the definition of Outstanding) and serial
numbers of Securities held by any Person, and the date of holding
the same, shall be proved by the Security Register.
(d) Any request, demand, authorization,
direction, notice, consent, election, waiver or other Act of a
Holder shall bind every future Holder of the same Security and the
Holder of every Security issued upon the registration of transfer
thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or the
Company in reliance thereon, whether or not notation of such action
is made upon such Security.
(e) Until such time as written instruments
shall have been delivered to the Trustee with respect to the
requisite percentage of principal amount of Securities for the
action contemplated by such instruments, any such instrument
executed and delivered by or on behalf of a Holder may be revoked
with respect to any or all of such Securities by written notice by
such Holder or any subsequent Holder, proven in the manner in which
such instrument was proven.
(f) Securities of any series, or any Tranche
thereof, authenticated and delivered after any Act of Holders may,
and shall if required by the Trustee, bear a notation in form
approved by the Trustee as to any action taken by such Act of
Holders. If the Company shall so determine, new Securities of any
series, or any Tranche thereof, so modified as to conform, in the
opinion of the Trustee and the Company, to such action may be
prepared and executed by the Company and authenticated and
delivered by the Trustee in exchange for Outstanding Securities of
such series or Tranche.
(g) The Company may, at its option, by
Company Order, fix in advance a record date for the determination
of Holders entitled to give any request, demand, authorization,
direction, notice, consent, waiver or other Act solicited by the
Company, but the Company shall have no obligation to do so;
provided, however, that the Company may not fix a record date for
the giving or making of any notice, declaration, request or
direction referred to in the next sentence. In addition, the
Trustee may, at its option, fix in advance a record date for the
determination of Holders of Securities of any series entitled to
join in the giving or making of any Notice of Default, any
declaration of acceleration referred to in Section 702, any request
to institute proceedings referred to in Section 707 or any
direction referred to in Section 712, in each case with respect to
Securities of such series. If any such record date is fixed, such
request, demand, authorization, direction, notice, consent, waiver
or other Act, or such notice, declaration, request or direction,
may be given before or after such record date, but only the Holders
of record at the close of business on the record date shall be
deemed to be Holders for the purposes of determining (i) whether
Holders of the requisite proportion of the Outstanding Securities
have authorized or agreed or consented to such Act (and for that
purpose the Outstanding Securities shall be computed as of the
record date) and/or (ii) which Holders may revoke any such Act
(notwithstanding subsection (e) of this Section); and any such Act,
given as aforesaid, shall be effective whether or not the Holders
which authorized or agreed or consented to such Act remain Holders
after such record date and whether or not the Securities held by
such Holders remain Outstanding after such record date.
SECTION 105. NOTICES, ETC. TO TRUSTEE AND COMPANY.
Any request, demand, authorization, direction,
notice, consent, election, waiver or Act of Holders or other
document provided or permitted by this Indenture to be made upon,
given or furnished to, or filed with, the Trustee by any Holder or
by the Company, or the Company by the Trustee or by any Holder,
shall be sufficient for every purpose hereunder (unless otherwise
expressly provided herein) if the same shall be in writing and
delivered personally to an officer or other responsible employee of
the addressee, or transmitted by facsimile transmission, telex or
other direct written electronic means to such telephone number or
other electronic communications address set forth opposite such
parties name below or as the parties hereto shall from time to time
designate, or transmitted by registered mail, charges prepaid, to
the applicable address set opposite such party's name below or to
such other address as either party hereto may from time to time
designate:
If to the Trustee, to:
The Chase Manhattan Bank
450 West 33rd Street - 15th Floor
New York, New York 10001
Attention: Global Trust Services
Telephone: (212) 270-6000
Facsimile: (212) 946-8158
If to the Company, to:
The Washington Water Power Company
1411 East Mission Avenue
Spokane, Washington 99202
Attention: Treasurer
Telephone: (509) 482-____
Facsimile: (509) 482-4879
Any communication contemplated herein shall be deemed
to have been made, given, furnished and filed if personally
delivered, on the date of delivery, if transmitted by facsimile
transmission, telex or other direct written electronic means, on
the date of transmission, and if transmitted by registered mail, on
the date of receipt.
SECTION 106. NOTICE TO HOLDERS OF SECURITIES; WAIVER.
Except as otherwise expressly provided herein, where
this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given, and shall be deemed given, to
Holders if in writing and mailed, first-class postage prepaid, to
each Holder affected by such event, at the address of such Holder
as it appears in the Security Register, not later than the latest
date, and not earlier than the earliest date, prescribed for the
giving of such notice.
In case by reason of the suspension of regular mail
service or by reason of any other cause it shall be impracticable
to give such notice to Holders by mail, then such notification as
shall be made with the approval of the Trustee shall constitute a
sufficient notification for every purpose hereunder. In any case
where notice to Holders is given by mail, neither the failure to
mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with
respect to other Holders.
Any notice required by this Indenture may be waived
in writing by the Person entitled to receive such notice, either
before or after the event otherwise to be specified therein, and
such waiver shall be the equivalent of such notice. Waivers of
notice by Holders shall be filed with the Trustee, but such filing
shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
SECTION 107. CONFLICT WITH TRUST INDENTURE ACT.
If any provision of this Indenture limits, qualifies
or conflicts with another provision hereof which is required or
deemed to be included in this Indenture by, or is otherwise
governed by, any provision of the Trust Indenture Act, such other
provision shall control; and if any provision hereof otherwise
conflicts with the Trust Indenture Act, the Trust Indenture Act
shall control.
SECTION 108. EFFECT OF HEADINGS AND TABLE OF CONTENTS.
The Article and Section headings in this Indenture
and the Table of Contents are for convenience only and shall not
affect the construction hereof.
SECTION 109. SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Indenture by the
Company shall bind its successors and assigns, whether so expressed
or not.
SECTION 110. SEPARABILITY CLAUSE.
In case any provision in this Indenture or the
Securities shall be held to be invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
SECTION 111. BENEFITS OF INDENTURE.
Nothing in this Indenture or the Securities, express
or implied, shall give to any Person, other than the parties
hereto, their successors hereunder and the Holders, any benefit or
any legal or equitable right, remedy or claim under this Indenture.
SECTION 112. GOVERNING LAW.
This Indenture and the Securities shall be governed
by and construed in accordance with the law of the State of New
York (including without limitation Section 5-1401 of the New York
General Obligations Law or any successor to such statute), except
to the extent that the Trust Indenture Act shall be applicable.
SECTION 113. LEGAL HOLIDAYS.
In any case where any Interest Payment Date,
Redemption Date or Stated Maturity of any Security shall not be a
Business Day at any Place of Payment, then (notwithstanding any
other provision of this Indenture or of the Securities other than a
contrary provision in the Securities of any series, or any Tranche
thereof, or in the indenture supplemental hereto, Board Resolution
or Officer's Certificate which establishes the terms of the
Securities of such series or Tranche) payment of interest or
principal and premium, if any, need not be made at such Place of
Payment on such date, but may be made on the next succeeding
Business Day at such Place of Payment with the same force and
effect as if made on the Interest Payment Date or Redemption Date,
or at the Stated Maturity, and, if such payment is made or duly
provided for on such Business Day, no interest shall accrue on the
amount so payable for the period from and after such Interest
Payment Date, Redemption Date or Stated Maturity, as the case may
be, to such Business Day.
ARTICLE TWO
SECURITY FORMS
SECTION 201. FORMS GENERALLY.
The definitive Securities of each series shall be in
substantially the form or forms established in the Officer's
Certificate, the indenture supplemental hereto or the Board
Resolution establishing such series, in any case with such
appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture, and may
have such letters, numbers or other marks of identification and
such legends or endorsements placed thereon as may be required to
comply with the rules of any securities exchange or as may, consis-
tently herewith, be determined by the officers executing such Secu-
rities, as evidenced by their execution of the Securities. If the
form or forms of Securities of any series are established in a
Board Resolution or in an Officer's Certificate, such Board
Resolution and Officer's Certificate, if any, shall be delivered to
the Trustee at or prior to the delivery of the Company Order
contemplated by Section 303 for the authentication and delivery of
such Securities.
The Securities of each series shall be issuable in
registered form without coupons. The definitive Securities shall
be produced in such manner as shall be determined by the officers
executing such Securities, as evidenced by their execution thereof.
SECTION 202. FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION.
The Trustee's certificate of authentication shall be
in substantially the form set forth below:
This is one of the Securities of the series desig-
nated therein referred to in the within-mentioned
Indenture.
_________________________________
as Trustee
By: _____________________________
Authorized Officer
ARTICLE THREE
THE SECURITIES
SECTION 301. AMOUNT UNLIMITED; ISSUABLE IN SERIES.
The aggregate principal amount of Securities which
may be authenticated and delivered under this Indenture is
unlimited.
The Securities may be issued in one or more series.
Subject to the last paragraph of this Section, prior to the
authentication and delivery of Securities of any series there shall
be established by specification in an Officer's Certificate, a
supplemental indenture or a Board Resolution:
(a) the title of the Securities of such
series (which shall distinguish the Securities of
such series from Securities of all other series);
(b) any limit upon the aggregate principal
amount of the Securities of such series which may be
authenticated and delivered under this Indenture
(except for Securities authenticated and delivered
upon registration of transfer of, or in exchange for,
or in lieu of, other Securities of such series
pursuant to Section 304, 305, 306, 406 or 1106 and
except for any Securities which, pursuant to Section
303, are deemed never to have been authenticated and
delivered hereunder);
(c) the Persons (without specific
identification) to whom interest, if any, on
Securities of such series, or any Tranche thereof,
shall be payable, if other than the Persons in whose
names such Securities (or one or more Predecessor
Securities) are registered at the close of business
on the Regular Record Date for such interest;
(d) the date or dates on which the principal
of the Securities of such series, or any Tranche
thereof, is payable or any formulary or other method
or other means by which such date or dates shall be
determined, by reference to an index or other fact or
event ascertainable outside of this Indenture or
otherwise (without regard to any provisions for
redemption, prepayment, acceleration, purchase or
extension); and the right, if any, to extend the
Maturity of the Securities of such series, or any
Tranche thereof, and the duration of any such
extension;
(e) the rate or rates at which the
Securities of such series, or any Tranche thereof,
shall bear interest, if any (including the rate or
rates at which overdue principal shall bear interest,
if different from the rate or rates at which such
Securities shall bear interest prior to Maturity,
and, if applicable, the rate or rates at which
overdue premium or interest shall bear interest, if
any), or any formulary or other method or other means
by which such rate or rates shall be determined, by
reference to an index or other fact or event
ascertainable outside of this Indenture or otherwise;
the date or dates from which such interest shall
accrue; the Interest Payment Dates on which such
interest shall be payable and the Regular Record
Date, if any, for the interest payable on such
Securities on any Interest Payment Date; the basis of
computation of interest, if other than as provided in
Section 310; and the right, if any, to extend the
interest payment periods and the duration of any such
extension;
(f) the place or places at which and/or the
methods (if other than as provided elsewhere in this
Indenture) by which (i) the principal of and premium,
if any, and interest, if any, on Securities of such
series, or any Tranche thereof, shall be payable,
(ii) registration of transfer of Securities of such
series, or any Tranche thereof, may be effected,
(iii) exchanges of Securities of such series, or any
Tranche thereof, may be effected and (iv) notices and
demands to or upon the Company in respect of the
Securities of such series, or any Tranche thereof,
and this Indenture may be served; the Security
Registrar and any Paying Agent or Agents for such
series or Tranche; and, if such is the case, that the
principal of such Securities shall be payable without
the presentment or surrender thereof;
(g) the period or periods within which or
the date or dates on which, the price or prices at
which and the terms and conditions upon which the
Securities of such series, or any Tranche thereof,
may be redeemed, in whole or in part, at the option
of the Company;
(h) the obligation or obligations, if any,
of the Company to redeem or purchase the Securities
of such series, or any Tranche thereof, pursuant to
any sinking fund or other mandatory redemption
provisions or at the option of a Holder thereof and
the period or periods within which or the date or
dates on which, the price or prices at which and the
terms and conditions upon which such Securities shall
be redeemed or purchased, in whole or in part,
pursuant to such obligation, and applicable
exceptions to the requirements of Section 404 in the
case of mandatory redemption or redemption at the
option of the Holder;
(i) the denominations in which Securities of
such series, or any Tranche thereof, shall be
issuable if other than denominations of One Thousand
Dollars ($1,000) and any integral multiple thereof;
(j) the currency or currencies, including
composite currencies, in which payment of the
principal of or premium, if any, or interest, if any,
on the Securities of such series, or any Tranche
thereof, shall be payable (if other than in Dollars)
and the formulary or other method or other means by
which the equivalent of any such amount in Dollars is
to be determined for any purpose, including for the
purpose of determining the principal amount of such
Securities deemed to be Outstanding at any time;
(k) if the principal of or premium, if any,
or interest, if any, on the Securities of such
series, or any Tranche thereof, are to be payable, at
the election of the Company or a Holder thereof, in a
coin or currency other than that in which the
Securities are stated to be payable, the period or
periods within which, and the terms and conditions
upon which, such election may be made;
(l) if the principal of or premium, if any,
or interest, if any, on the Securities of such
series, or any Tranche thereof, are to be payable, or
are to be payable at the election of the Company or a
Holder thereof, in securities or other property, the
type and amount of such securities or other property,
or the formulary or other method or other means by
which such amount shall be determined, and the period
or periods within which, and the terms and conditions
upon which, any such election may be made;
(m) if the amount payable in respect of the
principal of or premium, if any, or interest, if any,
on the Securities of such series, or any Tranche
thereof, may be determined with reference to an index
or other fact or event ascertainable outside of this
Indenture, the manner in which such amounts shall be
determined (to the extent not established pursuant to
clause (e) of this paragraph);
(n) if other than the principal amount
thereof, the portion of the principal amount of
Securities of such series, or any Tranche thereof,
which shall be payable upon declaration of ac-
celeration of the Maturity thereof pursuant to
Section 702;
(o) the terms, if any, pursuant to which the
Securities of such series, or any Tranche thereof,
may be converted into or exchanged for shares of
capital stock or other securities of the Company or
any other Person;
(p) the obligations or instruments, if any,
which shall be considered to be Eligible Obligations
in respect of the Securities of such series, or any
Tranche thereof, denominated in a currency other than
Dollars or in a composite currency, and any
additional or alternative provisions for the
reinstatement of the Company's indebtedness in
respect of such Securities after the satisfaction and
discharge thereof as provided in Section 601;
(q) if the Securities of such series, or any
Tranche thereof, are to be issued in global form, (i)
any limitations on the rights of the Holder or
Holders of such Securities to transfer or exchange
the same or to obtain the registration of transfer
thereof, (ii) any limitations on the rights of the
Holder or Holders thereof to obtain certificates
therefor in definitive form in lieu of temporary form
and (iii) any and all other matters incidental to
such Securities;
(r) if the Securities of such series, or any
Tranche thereof, are to be issuable as bearer
securities, any and all matters incidental thereto
which are not specifically addressed in a
supplemental indenture as contemplated by clause (f)
of Section 1101;
(s) to the extent not established pursuant
to clause (q) of this paragraph, any limitations on
the rights of the Holders of the Securities of such
Series, or any Tranche thereof, to transfer or
exchange such Securities or to obtain the
registration of transfer thereof; and if a service
charge will be made for the registration of transfer
or exchange of Securities of such series, or any
Tranche thereof, the amount or terms thereof;
(t) any exceptions to Section 113, or
variation in the definition of Business Day, with
respect to the Securities of such series, or any
Tranche thereof; and
(u) any other terms of the Securities of
such series, or any Tranche thereof.
With respect to Securities of a series subject to a
Periodic Offering, the Officer's Certificate, the indenture
supplemental hereto or the Board Resolution which establishes such
series, as the case may be, may provide general terms or parameters
for Securities of such series and provide either that the specific
terms of Securities of such series, or any Tranche thereof, shall
be specified in a Company Order or that such terms shall be
determined by the Company or its agents in accordance with
procedures specified in a Company Order as contemplated by clause
(b) of Section 303.
Unless otherwise specified with respect to a series
of Securities pursuant to Section 301(b), any limit upon the
aggregate principal amount of a series of Securities may be
increased without the consent of any Holders and additional
Securities of such series may be authenticated and delivered up to
the limit upon the aggregate principal amount authorized with
respect to such series as so increased.
Anything herein to the contrary notwithstanding, the
Trustee shall be under no obligation to authenticate and deliver
Securities of any series the terms of which, established as
contemplated by this Section, would affect the rights, duties,
obligations, liabilities or immunities of the Trustee under this
Indenture or otherwise.
SECTION 302. DENOMINATIONS.
Unless otherwise provided as contemplated by Section
301 with respect to any series of Securities, or any Tranche
thereof, the Securities of each series shall be issuable in
denominations of One Thousand Dollars ($1,000) and any integral
multiple thereof.
SECTION 303. EXECUTION, DATING, CERTIFICATE OF AUTHENTICATION.
Unless otherwise provided as contemplated by Section
301 with respect to any series of Securities, or any Tranche
thereof, the Securities shall be executed on behalf of the Company
by an Authorized Officer, and may have the corporate seal of the
Company affixed thereto or reproduced thereon and attested by any
other Authorized Officer. The signature of any or all of these
officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures
of individuals who were at the time of execution Authorized
Officers of the Company shall bind the Company, notwithstanding
that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities
or did not hold such offices at the date of such Securities.
The Trustee shall authenticate and deliver Securities
of a series, for original issue, at one time or from time to time
in accordance with the Company Order referred to below, upon
receipt by the Trustee of:
(a) the instrument or instruments estab-
lishing the form or forms and terms of such series,
as provided in Sections 201 and 301;
(b) a Company Order requesting the
authentication and delivery of such Securities and,
to the extent that the terms of such Securities shall
not have been established in an Officer's
Certificate, an indenture supplemental hereto or a
Board Resolution, all as contemplated by Sections 201
and 301, either (i) establishing such terms or (ii)
in the case of Securities of a series subject to a
Periodic Offering, specifying procedures, acceptable
to the Trustee, by which such terms are to be
established (which procedures may provide for
authentication and delivery pursuant to oral or
electronic instructions from the Company or any agent
or agents thereof, which oral instructions are to be
promptly confirmed electronically or in writing), in
either case in accordance with the instrument or
instruments delivered pursuant to clause (a) above;
(c) Securities of such series, executed on
behalf of the Company by an Authorized Officer;
(d) an Opinion of Counsel to the effect
that:
(i) the form or forms of such Securities
have been duly authorized by the Company and have
been established in conformity with the provisions
of this Indenture;
(ii) the terms of such Securities have been
duly authorized by the Company and have been
established in conformity with the provisions of
this Indenture; and
(iii) when such Securities shall have been
authenticated and delivered by the Trustee and
issued and delivered by the Company in the manner
and subject to any conditions specified in such
Opinion of Counsel, such Securities will constitute
valid obligations of the Company, entitled to the
benefits provided by this Indenture;
provided, however, that, with respect to Securities
of a series subject to a Periodic Offering, the
Trustee shall be entitled to receive such Opinion of
Counsel only once at or prior to the time of the
first authentication and delivery of such Securities
(provided that such Opinion of Counsel addresses the
authentication and delivery of all Securities of such
series) and that, in lieu of the opinions described
in clauses (ii) and (iii) above, Counsel may opine
that:
(x) when the terms of such Securities shall
have been established pursuant to a Company Order
or Orders or pursuant to such procedures as may be
specified from time to time by a Company Order or
Orders, all as contemplated by and in accordance
with the instrument or instruments delivered
pursuant to clause (a) above, such terms will have
been duly authorized by the Company and will have
been established in conformity with the provisions
of this Indenture; and
(y) when such Securities shall have been
authenticated and delivered by the Trustee in
accordance with this Indenture and the Company
Order or Orders or the specified procedures
referred to in paragraph (x) above and issued and
delivered by the Company in the manner and subject
to any conditions specified in such Opinion of
Counsel, such Securities will constitute valid
obligations of the Company, entitled to the
benefits provided by this Indenture.
With respect to Securities of a series subject to a
Periodic Offering, the Trustee may conclusively rely, as to the
authorization by the Company of any of such Securities, the forms
and terms thereof, the validity thereof and the compliance of the
authentication and delivery thereof with the terms and conditions
of this Indenture, upon the Opinion or Opinions of Counsel and the
certificates and other documents delivered pursuant to this Article
at or prior to the time of the first authentication and delivery of
Securities of such series until any of such opinions, certificates
or other documents have been superseded or revoked or expire by
their terms. In connection with the authentication and delivery of
Securities of a series subject to a Periodic Offering, the Trustee
shall be entitled to assume that the Company's instructions to
authenticate and deliver such Securities do not violate any
applicable law or any applicable rule, regulation or order of any
Governmental Authority having jurisdiction over the Company.
If the form of terms of the Securities of any series
have been established by or pursuant to a Board Resolution or an
Officer's Certificate as permitted by Sections 201 or 301, the
Trustee shall not be required to authenticate such Securities if
the issuance of such Securities pursuant to this Indenture will
affect the Trustee's own rights, duties or immunities under the
Securities and this Indenture or otherwise in a manner which is not
reasonably acceptable to the Trustee.
Unless otherwise specified as contemplated by Section
301 with respect to any series of Securities, or any Tranche
thereof, each Security shall be dated the date of its
authentication.
Unless otherwise specified as contemplated by Section
301 with respect to any series of Securities, or any Tranche
thereof, no Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there
appears on such Security a certificate of authentication sub-
stantially in the form provided for herein executed by the Trustee
or an Authenticating Agent by manual signature of an authorized
officer thereof, and such certificate upon any Security shall be
conclusive evidence, and the only evidence, that such Security has
been duly authenticated and delivered hereunder and is entitled to
the benefits of this Indenture. Notwithstanding the foregoing, if
(a) any Security shall have been authenticated and delivered
hereunder to the Company, or any Person acting on its behalf, but
shall never have been issued and sold by the Company, (b) the
Company shall deliver such Security to the Security Registrar for
cancellation or shall cancel such Security and deliver evidence of
such cancellation to the Trustee, in each case as provided in
Section 309, and (c) the Company, at its election, shall deliver to
the Trustee a written statement (which need not comply with Section
102 and need not be accompanied by an Officer's Certificate or an
Opinion of Counsel) stating that such Security has never been
issued and sold by the Company, then, for all purposes of this
Indenture, such Security shall be deemed never to have been
authenticated and delivered hereunder and shall never be entitled
to the benefits hereof.
SECTION 304. TEMPORARY SECURITIES.
Pending the preparation of definitive Securities of
any series, or any Tranche thereof, the Company may execute, and
upon Company Order the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed, typewritten,
mimeographed, photocopied or otherwise produced, in any authorized
denomination, substantially of the tenor of the definitive
Securities in lieu of which they are issued, with such appropriate
insertions, omissions, substitutions and other variations as the
officers executing such Securities may determine, as evidenced by
their execution of such Securities; provided, however, that
temporary Securities need not recite specific redemption, sinking
fund, conversion or exchange provisions.
Except as otherwise specified as contemplated by
Section 301 with respect to the Securities of any series, or any
Tranche thereof, after the preparation of definitive Securities of
such series or Tranche, the temporary Securities of such series or
Tranche shall be exchangeable, without charge to the Holder
thereof, for definitive Securities of such series or Tranche upon
surrender of such temporary Securities at the office or agency of
the Company maintained pursuant to Section 502 in a Place of
Payment for such Securities. Upon such surrender of temporary
Securities, the Company shall, except as aforesaid, execute and the
Trustee shall authenticate and deliver in exchange therefor
definitive Securities of the same series and Tranche, of authorized
denominations and of like tenor and aggregate principal amount.
Until exchanged in full as hereinabove provided,
temporary Securities shall in all respects be entitled to the same
benefits under this Indenture as definitive Securities of the same
series and Tranche and of like tenor authenticated and delivered
hereunder.
SECTION 305. REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE.
The Company shall cause to be kept in one of the
offices designated pursuant to Section 502, with respect to the
Securities of each series, or any Tranche thereof, a register (the
"SECURITY REGISTER") in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the
registration of Securities of such series or Tranche and the
registration of transfer thereof. The Company shall designate one
Person to maintain the Security Register for the Securities of each
series and such Person is referred to herein, with respect to such
series, as the "SECURITY REGISTRAR". Anything herein to the
contrary notwithstanding, the Company may designate one or more of
its offices as an office in which a register with respect to the
Securities of one or more series, or any Tranche or Tranches
thereof, shall be maintained, and the Company may designate itself
the Security Registrar with respect to one or more of such series.
The Security Register shall be open for inspection by the Trustee
and the Company at all reasonable times.
Except as otherwise specified as contemplated by
Section 301 with respect to the Securities of any series, or any
Tranche thereof, upon surrender for registration of transfer of any
Security of such series or Tranche at the office or agency of the
Company maintained pursuant to Section 502 in a Place of Payment
for such series or Tranche, the Company shall execute, and the
Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Securities of
the same series and Tranche, of authorized denominations and of
like tenor and aggregate principal amount.
Except as otherwise specified as contemplated by
Section 301 with respect to the Securities of any series, or any
Tranche thereof, any Security of such series or Tranche may be
exchanged at the option of the Holder, for one or more new
Securities of the same series and Tranche, of authorized denomina-
tions and of like tenor and aggregate principal amount, upon
surrender of the Securities to be exchanged at any such office or
agency. Whenever any Securities are so surrendered for exchange,
the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange is
entitled to receive.
All Securities delivered upon any registration of
transfer or exchange of Securities shall be valid obligations of
the Company, evidencing the same debt, and entitled to the same
benefits under this Indenture, as the Securities surrendered upon
such registration of transfer or exchange.
Every Security surrendered for registration of
transfer or for exchange shall (if so required by the Company, the
Trustee or the Security Registrar) be duly endorsed or shall be
accompanied by a written instrument of transfer in form sat-
isfactory to the Company, the Trustee or the Security Registrar, as
the case may be, duly executed by the Holder thereof or his
attorney duly authorized in writing.
Unless otherwise specified as contemplated by Section
301 with respect to Securities of any series, or any Tranche
thereof, no service charge shall be made for any registration of
transfer or exchange of Securities, but the Company may require
payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of
transfer or exchange of Securities, other than exchanges pursuant
to Section 304, 406 or 1106 not involving any transfer.
The Company shall not be required to execute or to
provide for the registration of transfer of or the exchange of (a)
Securities of any series, or any Tranche thereof, during a period
of fifteen (15) days immediately preceding the date notice is to be
given identifying the serial numbers of the Securities of such
series or Tranche called for redemption or (b) any Security so
selected for redemption in whole or in part, except the unredeemed
portion of any Security being redeemed in part.
SECTION 306. MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES.
If any mutilated Security is surrendered to the
Trustee, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a new Security of the
same series and Tranche, and of like tenor and principal amount and
bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the
Trustee (a) evidence to their satisfaction of the ownership of and
the destruction, loss or theft of any Security and (b) such
security or indemnity as may be reasonably required by them to save
each of them and any agent of either of them harmless, then, in the
absence of notice to the Company or the Trustee that such Security
is held by a Person purporting to be the owner of such Security,
the Company shall execute and the Trustee shall authenticate and
deliver, in lieu of any such destroyed, lost or stolen Security, a
new Security of the same series and Tranche, and of like tenor and
principal amount and bearing a number not contemporaneously
outstanding.
Notwithstanding the foregoing, in case any such
mutilated, destroyed, lost or stolen Security has become or is
about to become due and payable, the Company in its discretion may,
but subject to compliance with the foregoing conditions, instead of
issuing a new Security, pay such Security.
Upon the issuance of any new Security under this
Section, the Company may require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in
relation thereto and any other reasonable expenses (including the
fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to
this Section in lieu of any destroyed, lost or stolen Security
shall constitute an additional contractual obligation of the
Company, whether or not the destroyed, lost or stolen Security
shall be at any time enforceable by anyone other than the Holder of
such new Security, and any such new Security shall be entitled to
all the benefits of this Indenture equally and proportionately with
any and all other Securities of such series duly issued hereunder.
The provisions of this Section are exclusive and
shall preclude (to the extent lawful) all other rights and remedies
with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Securities.
SECTION 307. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.
Unless otherwise specified as contemplated by Section
301 with respect to the Securities of any series, or any Tranche
thereof, interest on any Security which is payable, and is
punctually paid or duly provided for, on any Interest Payment Date
shall be paid to the Person in whose name that Security (or one or
more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest.
Any interest on any Security of any series which is
payable, but is not punctually paid or duly provided for, on any
Interest Payment Date, including without limitation interest the
payment period for which has been extended as specified with
respect to such series as contemplated by Section 301 (herein
called "UNPAID INTEREST"), shall forthwith cease to be payable to
the Holder on the related Regular Record Date by virtue of having
been such Holder, and such Unpaid Interest may be paid by the
Company, at its election in each case, as provided in clause (a) or
(b) below:
(a) The Company may elect to make payment of
any Unpaid Interest to the Persons in whose names the
Securities of such series (or their respective Prede-
cessor Securities) are registered at the close of
business on a date (herein called a "SPECIAL RECORD
DATE") for the payment of such Unpaid Interest, which
shall be fixed in the following manner. The Company
shall notify the Trustee in writing of the amount of
Unpaid Interest proposed to be paid on each Security
of such series and the date of the proposed payment,
and at the same time the Company shall deposit with
the Trustee an amount of money equal to the aggregate
amount proposed to be paid in respect of such Unpaid
Interest or shall make arrangements satisfactory to
the Trustee for such deposit prior to the date of the
proposed payment, such money when deposited to be
held in trust for the benefit of the Persons entitled
to such Unpaid Interest as in this clause provided.
Thereupon the Trustee shall fix a Special Record Date
for the payment of such Unpaid Interest which shall
be not more than thirty (30) days and not less than
ten (10) days prior to the date of the proposed
payment and not less than twenty-five (25) days after
the receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly notify
the Company of such Special Record Date and, in the
name and at the expense of the Company, shall, not
less than fifteen (15) days prior to such Special
Record Date, cause notice of the proposed payment of
such Unpaid Interest and the Special Record Date
therefor to be mailed, first-class postage prepaid,
to each Holder of Securities of such series at the
address of such Holder as it appears in the Security
Register. Notice of the proposed payment of such
Unpaid Interest and the Special Record Date therefor
having been so mailed, such Unpaid Interest shall be
paid to the Persons in whose names the Securities of
such series (or their respective Predecessor
Securities) are registered at the close of business
on such Special Record Date.
(b) The Company may make payment of any
Unpaid Interest on the Securities of any series in
any other lawful manner not inconsistent with the
requirements of any securities exchange on which such
Securities may be listed, and upon such notice as may
be required by such exchange, if, after notice given
by the Company to the Trustee of the proposed payment
pursuant to this clause, such manner of payment shall
be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section
and Section 305, each Security delivered under this Indenture upon
registration of transfer of or in exchange for or in lieu of any
other Security shall carry the rights to interest accrued and
unpaid, and to accrue, which were carried by such other Security.
SECTION 308. PERSONS DEEMED OWNERS.
Prior to the due surrender of any Security for
registration of transfer, the Company, the Trustee and any agent of
the Company or the Trustee may treat the Person in whose name any
Security is registered as the absolute owner of such Security for
the purpose of receiving payment of principal of and premium, if
any, and (subject to Section 307) interest, if any, on such
Security and for all other purposes whatsoever, whether or not such
Security be overdue, and neither the Company, the Trustee nor any
agent of the Company or the Trustee shall be affected by notice to
the contrary.
SECTION 309. CANCELLATION BY SECURITY REGISTRAR.
All Securities surrendered for payment, redemption,
registration of transfer or exchange shall, if surrendered to any
Person other than the Security Registrar, be delivered to the
Security Registrar and, if not theretofore canceled, shall be
promptly canceled by the Security Registrar. The Company may at
any time deliver to the Security Registrar for cancellation any
Securities previously authenticated and delivered hereunder which
the Company may have acquired in any manner whatsoever or which the
Company shall not have issued and sold, and all Securities so
delivered shall be promptly canceled by the Security Registrar.
Unless by a Company Order the Company shall direct that canceled
Securities be returned to it, all canceled Securities held by the
Security Registrar shall be disposed of in accordance with the
Security Registrar's customary procedures, and the Security
Registrar shall promptly deliver a certificate of disposition to
the Trustee and the Company. The Security Registrar shall promptly
deliver evidence of any cancellation of a Security in accordance
with this Section 309 to the Trustee and the Company.
SECTION 310. COMPUTATION OF INTEREST.
Except as otherwise specified as contemplated by
Section 301 for Securities of any series, or any Tranche thereof,
interest on the Securities of each series shall be computed on the
basis of a three hundred sixty (360) day year consisting of twelve
(12) thirty (30) day months and, with respect to any period less
than a full calendar month, on the basis of the actual number of
days elapsed during such period.
SECTION 311. PAYMENT TO BE IN PROPER CURRENCY.
In the case of the Securities of any series, or any
Tranche thereof, denominated in any currency other than Dollars or
in a composite currency (the "REQUIRED CURRENCY"), except as
otherwise specified with respect to such Securities as contemplated
by Section 301, the obligation of the Company to make any payment
of the principal thereof, or the premium, if any, or interest, if
any, thereon, shall not be discharged or satisfied by any tender by
the Company, or recovery by the Trustee, in any currency other than
the Required Currency, except to the extent that such tender or
recovery shall result in the Trustee timely holding the full amount
of the Required Currency then due and payable. If any such tender
or recovery is in a currency other than the Required Currency, the
Trustee may take such actions as it considers appropriate to
exchange such currency for the Required Currency. The costs and
risks of any such exchange, including without limitation the risks
of delay and exchange rate fluctuation, shall be borne by the
Company, the Company shall remain fully liable for any shortfall or
delinquency in the full amount of Required Currency then due and
payable, and in no circumstances shall the Trustee be liable
therefor except in the case of its negligence or willful
misconduct.
ARTICLE FOUR
REDEMPTION OF SECURITIES
SECTION 401. APPLICABILITY OF ARTICLE.
Securities of any series, or any Tranche thereof,
which are redeemable before their Stated Maturity shall be
redeemable in accordance with their terms and (except as otherwise
specified as contemplated by Section 301 for Securities of such
series or Tranche) in accordance with this Article.
SECTION 402. ELECTION TO REDEEM; NOTICE TO TRUSTEE.
The election of the Company to redeem any Securities
shall be evidenced by a Board Resolution or an Officer's
Certificate. The Company shall, at least forty-five (45) days
prior to the Redemption Date fixed by the Company (unless a shorter
notice shall be satisfactory to the Trustee), notify the Trustee in
writing of such Redemption Date and of the principal amount of such
Securities to be redeemed. In the case of any redemption of
Securities (a) prior to the expiration of any restriction on such
redemption provided in the terms of such Securities or elsewhere in
this Indenture or (b) pursuant to an election of the Company which
is subject to a condition specified in the terms of such
Securities, the Company shall furnish the Trustee with an Officer's
Certificate evidencing compliance with such restriction or
condition.
SECTION 403. SELECTION OF SECURITIES TO BE REDEEMED.
If less than all the Securities of any series, or any
Tranche thereof, are to be redeemed, the particular Securities to
be redeemed shall be selected by the Security Registrar from the
Outstanding Securities of such series or Tranche not previously
called for redemption, by such method as shall be provided for any
particular series or Tranche, or, in the absence of any such
provision, by such method of random selection as the Security
Registrar shall deem fair and appropriate and which may, in any
case, provide for the selection for redemption of portions (in any
authorized denomination for Securities of such series or Tranche)
of the principal amount of Securities of such series or Tranche
having a denomination larger than the minimum authorized
denomination for Securities of such series or Tranche; provided,
however, that if, as indicated in an Officer's Certificate, the
Company shall have offered to purchase all or any principal amount
of the Securities then Outstanding of any series, or any Tranche
thereof, and less than all of such Securities as to which such
offer was made shall have been tendered to the Company for such
purchase, the Security Registrar, if so directed by Company Order,
shall select for redemption all or any principal amount of such
Securities which have not been so tendered.
The Security Registrar shall promptly notify the
Company and the Trustee in writing of the Securities selected for
redemption and, in the case of any Securities selected to be
redeemed in part, the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the
context otherwise requires, all provisions relating to the
redemption of Securities shall relate, in the case of any
Securities redeemed or to be redeemed only in part, to the portion
of the principal amount of such Securities which has been or is to
be redeemed.
SECTION 404. NOTICE OF REDEMPTION.
Notice of redemption shall be given in the manner
provided in Section 106 to the Holders of the Securities to be
redeemed not less than thirty (30) nor more than sixty (60) days
prior to the Redemption Date.
All notices of redemption shall state:
(a) the Redemption Date,
(b) the Redemption Price,
(c) if less than all the Securities of any
series or Tranche are to be redeemed, the
identification of the particular Securities to be
redeemed and the portion of the principal amount of
any Security to be redeemed in part,
(d) that on the Redemption Date the
Redemption Price, together with accrued interest, if
any, to the Redemption Date, will become due and
payable upon each such Security to be redeemed and,
if applicable, that interest thereon will cease to
accrue on and after said date,
(e) the place or places where such
Securities are to be surrendered for payment of the
Redemption Price and accrued interest, if any, unless
it shall have been specified as contemplated by
Section 301 with respect to such Securities that such
surrender shall not be required,
(f) that the redemption is for a sinking or
other fund, if such is the case, and
(g) such other matters as the Company shall
deem desirable or appropriate.
With respect to any notice of redemption of
Securities at the election of the Company, unless, upon the giving
of such notice, such Securities shall be deemed to have been paid
in accordance with Section 601, such notice may state that such
redemption shall be conditional upon the receipt by the Paying
Agent or Agents for such Securities, on or prior to the date fixed
for such redemption, of money sufficient to pay the principal of
and premium, if any, and interest, if any, on such Securities and
that if such money shall not have been so received such notice
shall be of no force or effect and the Company shall not be
required to redeem such Securities. In the event that such notice
of redemption contains such a condition and such money is not so
received, the redemption shall not be made and within a reasonable
time thereafter notice shall be given, in the manner in which the
notice of redemption was given, that such money was not so received
and such redemption was not required to be made, and the Paying
Agent or Agents for the Securities otherwise to have been redeemed
shall promptly return to the Holders thereof any of such Securities
which had been surrendered for payment upon such redemption.
Notice of redemption of Securities to be redeemed at
the election of the Company, and any notice of non-satisfaction of
a condition for redemption as aforesaid, shall be given by the
Company or, upon Company Request, by the Security Registrar in the
name and at the expense of the Company. Notice of mandatory
redemption of Securities shall be given by the Security Registrar
in the name and at the expense of the Company.
SECTION 405. SECURITIES PAYABLE ON REDEMPTION DATE.
Notice of redemption having been given as aforesaid,
and the conditions, if any, set forth in such notice having been
satisfied, the Securities or portions thereof so to be redeemed
shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date
(unless, in the case of an unconditional notice of redemption, the
Company shall default in the payment of the Redemption Price and
accrued interest, if any) such Securities or portions thereof, if
interest-bearing, shall cease to bear interest. Upon surrender of
any such Security for redemption in accordance with such notice,
such Security or portion thereof shall be paid by the Company at
the Redemption Price, together with accrued interest, if any, to
the Redemption Date; provided, however, that no such surrender
shall be a condition to such payment if so specified as
contemplated by Section 301 with respect to such Security; and
provided, further, that, except as otherwise specified as
contemplated by Section 301 with respect to such Security, any
installment of interest on any Security the Stated Maturity of
which installment is on or prior to the Redemption Date shall be
payable to the Holder of such Security, or one or more Predecessor
Securities, registered as such at the close of business on the
related Regular Record Date according to the terms of such Security
and subject to the provisions of Section 307.
SECTION 406. SECURITIES REDEEMED IN PART.
Upon the surrender of any Security which is to be
redeemed only in part at a Place of Payment therefor (with, if the
Company or the Trustee so requires, due endorsement by, or a
written instrument of transfer in form satisfactory to the Company
or the Trustee, as the case may be, duly executed by, the Holder
thereof or his attorney duly authorized in writing), the Company
shall execute, and the Trustee shall authenticate and deliver to
the Holder of such Security, without service charge, a new Security
or Securities of the same series and Tranche, of any authorized
denomination requested by such Holder and of like tenor and in
aggregate principal amount equal to and in exchange for the
unredeemed portion of the principal of the Security so surrendered.
ARTICLE FIVE
COVENANTS
SECTION 501. PAYMENT OF SECURITIES.
The Company shall pay the principal of and premium,
if any, and interest, if any, on the Securities of each series in
accordance with the terms of such Securities and this Indenture.
SECTION 502. MAINTENANCE OF OFFICE OR AGENCY.
The Company shall maintain in each Place of Payment
for the Securities of each series, or any Tranche thereof, an
office or agency where payment of such Securities shall be made,
where the registration of transfer or exchange of such Securities
may be effected and where notices and demands to or upon the
Company in respect of such Securities and this Indenture may be
served. The Company shall give prompt written notice to the
Trustee of the location, and any change in the location, of each
such office or agency and prompt notice to the Holders of any such
change in the manner specified in Section 106. If at any time the
Company shall fail to maintain any such required office or agency
in respect of Securities of any series, or any Tranche thereof, or
shall fail to furnish the Trustee with the address thereof, payment
of such Securities shall be made, registration of transfer or
exchange thereof may be effected and notices and demands in respect
thereof may be served at the Corporate Trust Office of the Trustee,
and the Company hereby appoints the Trustee as its agent for all
such purposes in any such event.
The Company may also from time to time designate one
or more other offices or agencies with respect to the Securities of
one or more series, or any Tranche thereof, for any or all of the
foregoing purposes and may from time to time rescind such
designations; provided, however, that, unless otherwise specified
as contemplated by Section 301 with respect to the Securities of
such series or Tranche, no such designation or rescission shall in
any manner relieve the Company of its obligation to maintain an
office or agency for such purposes in each Place of Payment for
such Securities in accordance with the requirements set forth
above. The Company shall give prompt written notice to the
Trustee, and prompt notice to the Holders in the manner specified
in Section 106, of any such designation or rescission and of any
change in the location of any such other office or agency.
Anything herein to the contrary notwithstanding, any
office or agency required by this Section may be maintained at an
office of the Company, in which event the Company shall perform all
functions to be performed at such office or agency.
SECTION 503. MONEY FOR SECURITIES PAYMENTS TO BE HELD IN TRUST.
If the Company shall at any time act as its own
Paying Agent with respect to the Securities of any series, or any
Tranche thereof, it shall, on or before each due date of the
principal of and premium, if any, and interest, if any, on any of
such Securities, segregate and hold in trust for the benefit of the
Persons entitled thereto a sum sufficient to pay the principal and
premium or interest so becoming due until such sums shall be paid
to such Persons or otherwise disposed of as herein provided. The
Company shall promptly notify the Trustee of any failure by the
Company (or any other obligor on such Securities) to make any
payment of principal of or premium, if any, or interest, if any, on
such Securities.
Whenever the Company shall have one or more Paying
Agents for the Securities of any series, or any Tranche thereof, it
shall, on or before each due date of the principal of and premium,
if any, and interest, if any, on such Securities, deposit with such
Paying Agents sums sufficient (without duplication) to pay the
principal and premium or interest so becoming due, such sums to be
held in trust for the benefit of the Persons entitled to such
principal, premium or interest, and (unless such Paying Agent is
the Trustee) the Company shall promptly notify the Trustee of any
failure by it so to act.
The Company shall cause each Paying Agent for the
Securities of any series, or any Tranche thereof, other than the
Company or the Trustee, to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee,
subject to the provisions of this Section, that such Paying Agent
shall:
(a) hold all sums held by it for the payment
of the principal of and premium, if any, or interest,
if any, on such Securities in trust for the benefit
of the Persons entitled thereto until such sums shall
be paid to such Persons or otherwise disposed of as
herein provided;
(b) give the Trustee notice of any failure
by the Company (or any other obligor upon such
Securities) to make any payment of principal of or
premium, if any, or interest, if any, on such
Securities; and
(c) at any time during the continuance of
any such failure, upon the written request of the
Trustee, forthwith pay to the Trustee all sums so
held in trust by such Paying Agent and furnish to the
Trustee such information as it possesses regarding
the names and addresses of the Persons entitled to
such sums.
The Company may at any time pay, or by Company Order
direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by
the Trustee upon the same trusts as those upon which such sums were
held by the Company or such Paying Agent and, if so stated in a
Company Order delivered to the Trustee, in accordance with the
provisions of Article Six; and, upon such payment by any Paying
Agent to the Trustee, such Paying Agent shall be released from all
further liability with respect to such money.
Any money deposited with the Trustee or any Paying
Agent, or then held by the Company, in trust for the payment of the
principal of and premium, if any, or interest, if any, on any
Security and remaining unclaimed for two years after such principal
and premium, if any, or interest, if any, has become due and
payable shall be paid to the Company on Company Request, or, if
then held by the Company, shall be discharged from such trust; and,
upon such payment or discharge, the Holder of such Security shall,
as an unsecured general creditor and not as the Holder of an
Outstanding Security, look only to the Company for payment of the
amount so due and payable and remaining unpaid, and all liability
of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall
thereupon cease; provided, however, that the Trustee or such Paying
Agent, before being required to make any such payment to the
Company, may at the expense of the Company cause to be mailed, on
one occasion only, notice to such Holder that such money remains
unclaimed and that, after a date specified therein, which shall not
be less than thirty (30) days from the date of such mailing, any
unclaimed balance of such money then remaining will be paid to the
Company.
SECTION 504. CORPORATE EXISTENCE.
Subject to the rights of the Company under Article
Ten, the Company shall do or cause to be done all things necessary
to preserve and keep its corporate existence in full force and
effect.
SECTION 505. MAINTENANCE OF PROPERTIES.
The Company shall cause (or, with respect to property
owned in common with others, make reasonable effort to cause) all
its properties used or useful in the conduct of its businesses,
considered as a whole, to be maintained and kept in good condition,
repair and working order and shall cause (or, with respect to
property owned in common with others, make reasonable effort to
cause) to be made such repairs, renewals, replacements, betterments
and improvements thereof, as, in the judgment of the Company, may
be necessary in order that the operation of such properties,
considered as a whole, may be conducted in accordance with common
industry practice; provided, however, that nothing in this Section
shall prevent the Company from discontinuing, or causing the
discontinuance of, the operation and maintenance of any of its
properties; and provided, further, that nothing in this Section
shall prevent the Company from selling, transferring or otherwise
disposing of, or causing the sale, transfer or other disposition
of, any of its properties.
SECTION 506. WAIVER OF CERTAIN COVENANTS.
The Company may omit in any particular instance to
comply with any term, provision or condition set forth in
(a) any covenant or restriction specified
with respect to the Securities of any one or more
series, or any Tranche or Tranches thereof, as
contemplated by Section 301 if before the time for
such compliance the Holders of a majority in
aggregate principal amount of the Outstanding
Securities of all series and Tranches with respect to
which compliance with such covenant or restriction is
to be omitted, considered as one class, shall, by Act
of such Holders, either waive such compliance in such
instance or generally waive compliance with such
term, provision or condition; provided, however, that
no such waiver shall be effective as to any matters
contemplated in clause (a), (b) or (c) in Section
1102 without consent of the Holders specified in such
Section; and
(b) Section 504 or 505 or Article Ten if
before the time for such compliance the Holders of a
majority in principal amount of Securities
Outstanding under this Indenture shall, by Act of
such Holders, either waive such compliance in such
instance or generally waive compliance with such
term, provision or condition;
but, in either case, no such waiver shall extend to or affect such
term, provision or condition except to the extent so expressly
waived, and, until such waiver shall become effective, the
obligations of the Company and the duties of the Trustee in respect
of any such term, provision or condition shall remain in full force
and effect.
SECTION 507. ANNUAL OFFICER'S CERTIFICATE AS TO COMPLIANCE.
Not later than December 1 in each year, commencing
December 1, 1998, the Company shall deliver to the Trustee an
Officer's Certificate which need not comply with Section 102,
executed by the principal executive officer, the principal
financial officer or the principal accounting officer of the
Company, as to such officer's knowledge of the Company's compliance
with all conditions and covenants under this Indenture, such
compliance to be determined without regard to any period of grace
or requirement of notice under this Indenture.
ARTICLE SIX
Satisfaction and Discharge
SECTION 601. SATISFACTION AND DISCHARGE OF SECURITIES.
Any Security or Securities, or any portion of the
principal amount thereof, shall be deemed to have been paid for all
purposes of this Indenture, and the entire indebtedness of the
Company in respect thereof shall be satisfied and discharged, if
there shall have been irrevocably deposited with the Trustee or any
Paying Agent (other than the Company), in trust:
(a) money in an amount which shall be
sufficient, or
(b) in the case of a deposit made prior to
the Maturity of such Securities or portions thereof,
Eligible Obligations, which shall not contain
provisions permitting the redemption or other
prepayment thereof at the option of the issuer
thereof, the principal of and the interest on which
when due, without any regard to reinvestment thereof,
will provide moneys which, together with the money,
if any, deposited with or held by the Trustee or such
Paying Agent, shall be sufficient, or
(c) a combination of (a) or (b) which shall
be sufficient,
to pay when due the principal of and premium, if any, and interest,
if any, due and to become due on such Securities or portions
thereof; provided, however, that in the case of the provision for
payment or redemption of less than all the Securities of any series
or Tranche, such Securities or portions thereof shall have been
selected by the Security Registrar as provided herein and, in the
case of a redemption, the notice requisite to the validity of such
redemption shall have been given or irrevocable authority shall
have been given by the Company to the Trustee to give such notice,
under arrangements satisfactory to the Trustee; and provided,
further, that the Company shall have delivered to the Trustee and
such Paying Agent:
(x) if such deposit shall have been made
prior to the Maturity of such Securities, a Company
Order stating that the money and Eligible Obligations
deposited in accordance with this Section shall be
held in trust, as provided in Section 603;
(y) if Eligible Obligations shall have been
deposited, an Opinion of Counsel to the effect that
such obligations constitute Eligible Obligations and
do not contain provisions permitting the redemption
or other prepayment thereof at the option of the
issuer thereof, and an opinion of an independent
public accountant of nationally recognized standing,
selected by the Company, to the effect that the other
requirements set forth in clause (b) and, if
applicable, (c) above have been satisfied; and
(z) if such deposit shall have been made prior to
the Maturity of such Securities, an Officer's
Certificate stating the Company's intention that,
upon delivery of such Officer's Certificate, its
indebtedness in respect of such Securities or
portions thereof will have been satisfied and
discharged as contemplated in this Section.
Upon the deposit of money or Eligible Obligations, or
both, in accordance with this Section, together with the documents
required by clauses (x), (y) and (z) above, the Trustee shall, upon
Company Request, acknowledge in writing that such Securities or
portions thereof are deemed to have been paid for all purposes of
this Indenture and that the entire indebtedness of the Company in
respect thereof has been satisfied and discharged as contemplated
in this Section. In the event that all of the conditions set forth
in the preceding paragraph shall have been satisfied in respect of
any Securities or portions thereof except that, for any reason, the
Officer's Certificate specified in clause (z) (if otherwise
required) shall not have been delivered, such Securities or
portions thereof shall nevertheless be deemed to have been paid for
all purposes of this Indenture, and the Holders of such Securities
or portions thereof shall nevertheless be no longer entitled to the
benefits provided by this Indenture or of any of the covenants of
the Company under Article Five (except the covenants contained in
Sections 502 and 503) or any other covenants made in respect of
such Securities or portions thereof as contemplated by Section 301,
but the indebtedness of the Company in respect of such Securities
or portions thereof shall not be deemed to have been satisfied and
discharged prior to Maturity for any other purpose; and, upon
Company Request, the Trustee shall acknowledge in writing that such
Securities or portions thereof are deemed to have been paid for all
purposes of this Indenture.
If payment at Stated Maturity of less than all of the
Securities of any series, or any Tranche thereof, is to be provided
for in the manner and with the effect provided in this Section, the
Security Registrar shall select such Securities, or portions of
principal amount thereof, in the manner specified by Section 403
for selection for redemption of less than all the Securities of a
series or Tranche.
In the event that Securities which shall be deemed to
have been paid for purposes of this Indenture, and, if such is the
case, in respect of which the Company's indebtedness shall have
been satisfied and discharged, all as provided in this Section, do
not mature and are not to be redeemed within the sixty (60) day
period commencing with the date of the deposit of moneys or
Eligible Obligations, as aforesaid, the Company shall, as promptly
as practicable, give a notice, in the same manner as a notice of
redemption with respect to such Securities, to the Holders of such
Securities to the effect that such deposit has been made and the
effect thereof.
Notwithstanding that any Securities shall be deemed
to have been paid for purposes of this Indenture, as aforesaid, the
obligations of the Company and the Trustee in respect of such
Securities under Sections 304, 305, 306, 404, 502, 503, 807 and 814
and this Article shall survive.
The Company shall pay, and shall indemnify the
Trustee or any Paying Agent with which Eligible Obligations shall
have been deposited as provided in this Section against, any tax,
fee or other charge imposed on or assessed against such Eligible
Obligations or the principal or interest received in respect of
such Eligible Obligations, including, but not limited to, any such
tax payable by any entity deemed, for tax purposes, to have been
created as a result of such deposit.
Anything herein to the contrary notwithstanding, (a)
if, at any time after a Security would be deemed to have been paid
for purposes of this Indenture, and, if such is the case, the
Company's indebtedness in respect thereof would be deemed to have
been satisfied and discharged, pursuant to this Section (without
regard to the provisions of this paragraph), the Trustee or any
Paying Agent, as the case may be, (i) shall be required to return
the money or Eligible Obligations, or combination thereof,
deposited with it as aforesaid to the Company or its representative
under any applicable Federal or State bankruptcy, insolvency or
other similar law or (ii) are unable to apply any money held by the
Trustee as provided in this Section and Section 603 with respect to
such Security by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise
prohibiting such application, such Security shall thereupon be
deemed retroactively not to have been paid and any satisfaction and
discharge of the Company's indebtedness in respect thereof shall
retroactively be deemed not to have been effected, and such
Security shall be deemed to remain Outstanding and (b) any
satisfaction and discharge of the Company's indebtedness in respect
of any Security shall be subject to the provisions of the last
paragraph of Section 503.
SECTION 602. SATISFACTION AND DISCHARGE OF INDENTURE.
This Indenture shall upon Company Request cease to be
of further effect (except as hereinafter expressly provided), and
the Trustee, at the expense of the Company, shall execute such
instruments as the Company shall reasonably request to evidence and
acknowledge the satisfaction and discharge of this Indenture, when:
(a) no Securities remain Outstanding
hereunder; and
(b) the Company has paid or caused to be
paid all other sums payable hereunder by the Company;
provided, however, that if, in accordance with the last paragraph
of Section 601, any Security, previously deemed to have been paid
for purposes of this Indenture, shall be deemed retroactively not
to have been so paid, this Indenture shall thereupon be deemed
retroactively not to have been satisfied and discharged, as
aforesaid, and to remain in full force and effect, and the Company
shall execute and deliver such instruments as the Trustee shall
reasonably request to evidence and acknowledge the same.
Notwithstanding the satisfaction and discharge of
this Indenture as aforesaid, the obligations of the Company and the
Trustee under Sections 304, 305, 306, 404, 502, 503, 807 and 814
and this Article shall survive.
Upon satisfaction and discharge of this Indenture as
provided in this Section, the Trustee shall turn over to the
Company any and all money, securities and other property then held
by the Trustee for the benefit of the Holders of the Securities
(other than money and Eligible Obligations held by the Trustee
pursuant to Section 603) and shall execute and deliver to the
Company such instruments as, in the judgment of the Company, shall
be necessary, desirable or appropriate to effect or evidence the
satisfaction and discharge of this Indenture.
SECTION 603. APPLICATION OF TRUST MONEY.
Neither the Eligible Obligations nor the money
deposited pursuant to Section 601, nor the principal or interest
payments on any such Eligible Obligations, shall be withdrawn or
used for any purpose other than, and shall be held in trust for,
the payment of the principal of and premium, if any, and interest,
if any, on the Securities or portions of principal amount thereof
in respect of which such deposit was made, all subject, however, to
the provisions of Section 503; provided, however, that any cash
received from such principal or interest payments on such Eligible
Obligations, if not then needed for such purpose, shall, to the
extent practicable and upon Company Request and delivery to the
Trustee of the documents referred to in clause (y) in the first
paragraph of Section 601, be invested in Eligible Obligations of
the type described in clause (b) in the first paragraph of Section
601 maturing at such times and in such amounts as shall be
sufficient, together with any other moneys and the proceeds of any
other Eligible Obligations then held by the Trustee, to pay when
due the principal of and premium, if any, and interest, if any, due
and to become due on such Securities or portions thereof on and
prior to the Maturity thereof, and interest earned from such
reinvestment shall be paid over to the Company as received, free
and clear of any trust, lien or pledge under this Indenture; and
provided, further, that any moneys held in accordance with this
Section on the Maturity of all such Securities in excess of the
amount required to pay the principal of and premium, if any, and
interest, if any, then due on such Securities shall be paid over to
the Company free and clear of any trust, lien or pledge under this
Indenture; and provided, further, that if an Event of Default shall
have occurred and be continuing, moneys to be paid over to the
Company pursuant to this Section shall be held until such Event of
Default shall have been waived or cured.
ARTICLE SEVEN
EVENTS OF DEFAULT; REMEDIES
SECTION 701. EVENTS OF DEFAULT.
"EVENT OF DEFAULT", wherever used herein with respect
to the Securities of any series, means any of the following events
which shall have occurred and be continuing:
(a) failure to pay interest, if any, on any
Security of such series within sixty (60) days after the same
becomes due and payable; provided, however, that no such
failure shall constitute an "Event of Default" if the Company
shall have made a valid extension of the interest payment
period with respect to the Securities of such series if so
provided with respect to such series as contemplated by
Section 301; or
(b) failure to pay the principal of or
premium, if any, on any Security of such series within three
(3) Business Days after its Maturity; provided, however, that
no such failure shall constitute an "Event of Default" if the
Company shall have made a valid extension of the Maturity of
the Securities of such series if so provided with respect to
such series as contemplated by Section 301; or
(c) failure to perform or breach of any
covenant or warranty of the Company in this Indenture (other
than a covenant or warranty a default in the performance of
which or breach of which is elsewhere in this Section
specifically dealt with or which has expressly been included
in this Indenture solely for the benefit of one or more series
of Securities other than such series) for a period of ninety
(90) days after there has been given, by registered or certi-
fied mail, to the Company by the Trustee, or to the Company
and the Trustee by the Holders of at least twenty-five per
centum (25%) in principal amount of the Outstanding Securities
of such series, a written notice specifying such default or
breach and requiring it to be remedied and stating that such
notice is a "NOTICE OF DEFAULT" hereunder, unless the Trustee,
or the Trustee and the Holders of a principal amount of
Securities of such series not less than the principal amount
of Securities the Holders of which gave such notice, as the
case may be, shall agree in writing to an extension of such
period prior to its expiration; provided, however, that the
Trustee, or the Trustee and the Holders of such principal
amount of Securities of such series, as the case may be, shall
be deemed to have agreed to an extension of such period if
corrective action is initiated by the Company within such
period and is being diligently pursued; or
(d) a default under any bond, debenture,
note or other evidence of indebtedness for money borrowed by
the Company (including a default with respect to Securities of
any series other than such series) or under any mortgage,
indenture or other instrument under which there may be issued
or by which there may be secured or evidenced any indebtedness
for money borrowed by the Company (including this Indenture),
whether such indebtedness now exists or shall hereafter be
created, which default (1) shall constitute a failure to make
any payment in excess of $5,000,000 of the principal of or
interest on such indebtedness when due and payable after the
expiration of any applicable grace period with respect thereto
or (2) shall have resulted in such indebtedness in an amount
in excess of $10,000,000 becoming or being declared due and
payable prior to the date on which it would otherwise have
become due and payable, without such payment having been made,
such indebtedness having been discharged, or such acceleration
having been rescinded or annulled, as the case may be, within
a period of ninety (90) days after there shall have been
given, by registered or certified mail, to the Company by the
Trustee or to the Company and the Trustee by the Holders of at
least twenty-five per centum (25%) in principal amount of the
Outstanding Securities of such series a written notice
specifying such default and requiring the Company to cause
such payment to be made, such indebtedness to be discharged or
such acceleration to be rescinded or annulled, as the case may
be, and stating that such notice is a Notice of Default
hereunder; or
(e) the entry by a court having jurisdiction
in the premises of (i) a decree or order for relief in respect
of the Company in an involuntary case or proceeding under any
applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (ii) a decree or order
adjudging the Company a bankrupt or insolvent, or approving as
properly filed a petition by one or more Persons other than
the Company seeking reorganization, arrangement, adjustment or
composition of or in respect of the Company under any
applicable Federal or State law, or appointing a custodian,
receiver, liquidator, assignee, trustee, sequestrator or other
similar official for the Company or for any substantial part
of its property, or ordering the winding-up or liquidation of
its affairs, and any such decree or order for relief or any
such other decree or order shall have remained unstayed and in
effect for a period of ninety (90) consecutive days; or
(f) the commencement by the Company of a
voluntary case or proceeding under any applicable Federal or
State bankruptcy, insolvency, reorganization or other similar
law or of any other case or proceeding to be adjudicated a
bankrupt or insolvent, or the consent by it to the entry of a
decree or order for relief in respect of the Company in a case
or proceeding under any applicable Federal or State
bankruptcy, insolvency, reorganization or other similar law or
to the commencement of any bankruptcy or insolvency case or
proceeding against it, or the filing by it of a petition or
answer or consent seeking reorganization or relief under any
applicable Federal or State law, or the consent by it to the
filing of such petition or to the appointment of or taking
possession by a custodian, receiver, liquidator, assignee,
trustee, sequestrator or similar official of the Company or of
any substantial part of its property, or the making by it of
an assignment for the benefit of creditors, or the admission
by it in writing of its inability to pay its debts generally
as they become due, or the authorization of such action by the
Board of Directors.
SECTION 702. ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT.
If an Event of Default shall have occurred and be
continuing with respect to Securities of any series at the time
Outstanding, then in every such case the Trustee or the Holders of
not less than thirty-three per centum (33%) in principal amount of
the Outstanding Securities of such series may declare the principal
amount (or, if any of the Securities of such series are Discount
Securities, such portion of the principal amount of such Securities
as may be specified in the terms thereof as contemplated by Section
301) of all of the Outstanding Securities of such series to be due
and payable immediately, by a notice in writing to the Company (and
to the Trustee if given by Holders), and upon such declaration such
principal amount (or specified amount), together with premium, if
any, and accrued interest, if any, thereon, shall become
immediately due and payable; provided, however, that if an Event of
Default shall have occurred and be continuing with respect to more
than one series of Securities, the Trustee or the Holders of not
less than thirty-three per centum (33%) in aggregate principal
amount of the Outstanding Securities of all such series, considered
as one class, may make such declaration of acceleration, and not
the Holders of the Securities of any one of such series.
At any time after such a declaration of acceleration
with respect to Securities of any series shall have been made, but
before a judgment or decree for payment of the money due shall have
been obtained by the Trustee as provided in this Article, such
declaration and its consequences shall, without further act, be
deemed to have been rescinded and annulled, if
(a) the Company shall have paid or deposited
with the Trustee a sum sufficient to pay
(i) all overdue interest, if any, on all
Securities of such series then Outstanding;
(ii) the principal of and premium, if any, on
any Securities of such series then Outstanding
which have become due otherwise than by such
declaration of acceleration and interest thereon at
the rate or rates prescribed therefor in such
Securities;
(iii) interest upon overdue interest at the rate
or rates prescribed therefor in such Securities, to
the extent that payment of such interest is lawful;
and
(iv) all amounts due to the Trustee under
Section 807; and
(b) all Events of Default with respect to
Securities of such series, other than the non-payment
of the principal of Securities of such series which
shall have become due solely by such declaration of
acceleration, shall have been cured or waived as
provided in Section 713.
No such rescission shall affect any subsequent Event of Default or
impair any right consequent thereon.
SECTION 703. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT
BY TRUSTEE.
If an Event of Default described in clause (a) or (b)
of Section 701 shall have occurred and be continuing, the Company
shall, upon demand of the Trustee, pay to it, for the benefit of
the Holders of the Securities of the series with respect to which
such Event of Default shall have occurred, the whole amount then
due and payable on such Securities for principal and premium, if
any, and interest, if any, and, in addition thereto, such further
amount as shall be sufficient to cover any amounts due to the
Trustee under Section 807.
If the Company shall fail to pay such amounts
forthwith upon such demand, the Trustee, in its own name and as
trustee of an express trust, may institute a judicial proceeding
for the collection of the sums so due and unpaid, may prosecute
such proceeding to judgment or final decree and may enforce the
same against the Company or any other obligor upon such Securities
and collect the moneys adjudged or decreed to be payable in the
manner provided by law out of the property of the Company or any
other obligor upon such Securities, wherever situated.
If an Event of Default with respect to Securities of
any series shall have occurred and be continuing, the Trustee may
in its discretion proceed to protect and enforce its rights and the
rights of the Holders of Securities of such series by such
appropriate judicial proceedings as the Trustee shall deem most
effectual to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture
or in aid of the exercise of any power granted herein, or to
enforce any other proper remedy.
SECTION 704. APPLICATION OF MONEY COLLECTED.
Any money collected by the Trustee pursuant to this
Article shall be applied in the following order, to the extent
permitted by law, at the date or dates fixed by the Trustee and, in
case of the distribution of such money on account of principal or
premium, if any, or interest, if any, upon presentation of the
Securities and the notation thereon of the payment if only
partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the
Trustee under Section 807;
SECOND: To the payment of the whole amount then
due and unpaid upon the Outstanding Securities for principal
and premium, if any, and interest, if any, in respect of which
or for the benefit of which such money has been collected; and
in case such proceeds shall be insufficient to pay in full the
whole amount so due and unpaid upon such Securities, then to
the payment of such principal and interest, if any, thereon
without any preference or priority, ratably according to the
aggregate amount so due and unpaid, with any balance then
remaining to the payment of premium, if any, and, if so
specified as contemplated by Section 301 with respect to the
Securities of any series, or any Tranche thereof, interest, if
any, on overdue premium, if any, and overdue interest, if any,
ratably as aforesaid, all to the extent permitted by
applicable law;
THIRD: To the payment of the remainder, if any, to
the Company or to whomsoever may be lawfully entitled to
receive the same or as a court of competent jurisdiction may
direct.
SECTION 705. TRUSTEE MAY FILE PROOFS OF CLAIM.
In case of the pendency of any receivership,
insolvency, liquidation, bankruptcy, reorganization, arrangement,
adjustment, composition or other judicial proceeding relative to
the Company or any other obligor upon the Securities or the
property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of
the Securities shall then be due and payable as therein expressed
or by declaration or otherwise and irrespective of whether the
Trustee shall have made any demand on the Company for the payment
of overdue principal or interest) shall be entitled and empowered,
by intervention in such proceeding or otherwise,
(a) to file and prove a claim for the whole
amount of principal, premium, if any, and interest, if any,
owing and unpaid in respect of the Securities and to file such
other papers or documents as may be necessary or advisable in
order to have the claims of the Trustee (including any claim
for amounts due to the Trustee under Section 807) and of the
Holders allowed in such judicial proceeding, and
(b) to collect and receive any moneys or
other property payable or deliverable on any such claims and
to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, seques-
trator or other similar official in any such judicial proceeding is
hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the
Trustee any amounts due it under Section 807.
Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf
of any Holder any plan of reorganization, arrangement, adjustment
or composition affecting the Securities or the rights of any Holder
thereof or to authorize the Trustee to vote in respect of the claim
of any Holder in any such proceeding.
SECTION 706. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION
OF SECURITIES.
All rights of action and claims under this Indenture
or on the Securities may be prosecuted and enforced by the Trustee
without the possession of any of the Securities or the production
thereof in any proceeding relating thereto, and any such proceeding
instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and
counsel, be for the ratable benefit of the Holders in respect of
which such judgment has been recovered.
SECTION 707. LIMITATION ON SUITS.
No Holder shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture,
or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless:
(a) such Holder shall have previously given
written notice to the Trustee of a continuing Event of Default
with respect to the Securities of such series;
(b) the Holders of a majority in aggregate
principal amount of the Outstanding Securities of all series
in respect of which an Event of Default shall have occurred
and be continuing, considered as one class, shall have made
written request to the Trustee to institute proceedings in
respect of such Event of Default in its own name as Trustee
hereunder;
(c) such Holder or Holders shall have
offered to the Trustee reasonable indemnity against the costs,
expenses and liabilities to be incurred in compliance with
such request;
(d) the Trustee for sixty (60) days after
its receipt of such notice, request and offer of indemnity
shall have failed to institute any such proceeding; and
(e) no direction inconsistent with such
written request shall have been given to the Trustee during
such sixty (60) day period by the Holders of a majority in
aggregate principal amount of the Outstanding Securities of
all series in respect of which an Event of Default shall have
occurred and be continuing, considered as one class.
it being understood and intended that no one or more of the Holders
of Securities of any series shall have any right in any manner
whatever by virtue of, or by availing of, any provision of this
Indenture to affect, disturb or prejudice the rights of any other
of the Holders of Securities of such series or to obtain or to seek
to obtain priority or preference over any other Holders of
Securities of such series or to enforce any right under this
Indenture, except in the manner herein provided and for the equal
and ratable benefit of all Holders of Securities of such series.
SECTION 708. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL,
PREMIUM AND INTEREST.
Notwithstanding any other provision in this
Indenture, the Holder of any Security shall have the right, which
is absolute and unconditional, to receive payment of the principal
of and premium, if any, and (subject to Section 307) interest, if
any, on such Security on the Stated Maturity or Maturities
expressed in such Security (or, in the case of redemption, on the
Redemption Date) and to institute suit for the enforcement of any
such payment, and such rights shall not be impaired without the
consent of such Holder.
SECTION 709. RESTORATION OF RIGHTS AND REMEDIES.
If the Trustee or any Holder has instituted any
proceeding to enforce any right or remedy under this Indenture and
such proceeding shall have been discontinued or abandoned for any
reason, or shall have been determined adversely to the Trustee or
to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and such
Holder shall be restored severally and respectively to their former
positions hereunder and thereafter all rights and remedies of the
Trustee and such Holder shall continue as though no such proceeding
had been instituted.
SECTION 710. RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided in the last paragraph of
Section 306, no right or remedy herein conferred upon or reserved
to the Trustee or to the Holders is intended to be exclusive of any
other right or remedy, and every right and remedy shall, to the
extent permitted by law, be cumulative and in addition to every
other right and remedy given hereunder or now or hereafter existing
at law or in equity or otherwise. The assertion or employment of
any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right
or remedy.
SECTION 711. DELAY OR OMISSION NOT WAIVER.
No delay or omission of the Trustee or of any Holder
to exercise any right or remedy accruing upon any Event of Default
shall impair any such right or remedy or constitute a waiver of any
such Event of Default or an acquiescence therein. Every right and
remedy given by this Article or by law to the Trustee or to the
Holders may be exercised from time to time, and as often as may be
deemed expedient, by the Trustee or by the Holders, as the case may
be.
SECTION 712. CONTROL BY HOLDERS OF SECURITIES.
If an Event of Default shall have occurred and be
continuing in respect of a series of Securities, the Holders of a
majority in principal amount of the Outstanding Securities of such
series shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee,
or exercising any trust or power conferred on the Trustee with
respect to the Securities of such series; provided, however, that
if an Event of Default shall have occurred and be continuing with
respect to more than one series of Securities, the Holders of a
majority in aggregate principal amount of the Outstanding
Securities of all such series, considered as one class, shall have
the right to make such direction, and not the Holders of the
Securities of any one of such series; and provided, further, that
(a) such direction shall not be in conflict
with any rule of law or with this Indenture, and could not
involve the Trustee in personal liability in circumstances
where indemnity would not, in the Trustee's sole discretion,
be adequate, and
(b) the Trustee may take any other action
deemed proper by the Trustee which is not inconsistent with
such direction.
SECTION 713. WAIVER OF PAST DEFAULTS.
The Holders of a majority in principal amount of the
Outstanding Securities of any series may on behalf of the Holders
of all the Securities of such series waive any past default with
respect to such series hereunder and its consequences, except a
default
(a) in the payment of the principal of or
premium, if any, or interest, if any, on any Security of such
series, or
(b) in respect of a covenant or provision
hereof which under Section 1102 cannot be modified or amended
without the consent of the Holder of each Outstanding Security
of such series affected.
Upon any such waiver, such default shall cease to
exist, and any and all Events of Default arising therefrom shall be
deemed to have been cured, for every purpose of this Indenture; but
no such waiver shall extend to any subsequent or other default or
impair any right consequent thereon.
SECTION 714. UNDERTAKING FOR COSTS.
The Company and the Trustee agree, and each Holder by
its acceptance of a Security shall be deemed to have agreed, that
any court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any
suit against the Trustee for any action taken, suffered or omitted
by it as Trustee, the filing by any party litigant in such suit of
an undertaking to pay the costs of such suit, and that such court
may in its discretion assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in such suit, having
due regard to the merits and good faith of the claims or defenses
made by such party litigant, all in the manner, to the extent and
except as provided in the Trust Indenture Act; but the provisions
of this Section shall not apply to any suit instituted by the
Company, to any suit instituted by the Trustee, to any suit
instituted by any Holder, or group of Holders, holding in the
aggregate more than ten per centum (10%) in aggregate principal
amount of the Outstanding Securities of all series in respect of
which such suit may be brought, considered as one class, or to any
suit instituted by any Holder for the enforcement of the payment of
the principal of or premium, if any, or interest, if any, on any
Security on or after the Stated Maturity or Maturities expressed in
such Security (or, in the case of redemption, on or after the
Redemption Date).
SECTION 715. WAIVER OF STAY OR EXTENSION LAWS.
To the full extent that it may lawfully so agree, the
Company shall not at any time set up, claim or otherwise seek to
take the benefit or advantage of any stay or extension law, now or
hereafter in effect, in order to prevent or hinder the enforcement
of this Indenture; and the Company, for itself and all who may
claim under it, so far as it or they now or hereafter may lawfully
do so, hereby waives the benefit of all such laws.
ARTICLE EIGHT
THE TRUSTEE
SECTION 801. CERTAIN DUTIES AND RESPONSIBILITIES.
(a) Except during the continuance of an
Event of Default with respect to Securities of any series,
(i) the Trustee undertakes to perform, with
respect to Securities of such series, such duties and
only such duties as are specifically set forth in
this Indenture, and no implied covenants or
obligations shall be read into this Indenture against
the Trustee; and
(ii) in the absence of bad faith on its part,
the Trustee may, with respect to Securities of such
series, conclusively rely, as to the truth of the
statements and the correctness of the opinions
expressed therein, upon certificates or opinions
furnished to the Trustee and conforming to the
requirements of this Indenture; but in the case of
any such certificates or opinions which by any
provisions hereof are specifically required to be
furnished to the Trustee, the Trustee shall be under
a duty to examine the same to determine whether or
not they conform to the requirements of this
Indenture.
(b) In case an Event of Default with respect
to Securities of any series shall have occurred and be continuing,
the Trustee shall exercise, with respect to Securities of such
series, such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their
exercise, as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs.
(c) No provision of this Indenture shall be
construed to relieve the Trustee from liability for its own
negligent action, its own negligent failure to act, or its own
willful misconduct, except that:
(i) this subsection shall not be construed
to limit the effect of subsection (a) of this
Section;
(ii) the Trustee shall not be liable for any
error of judgment made in good faith by a Responsible
Officer, unless it shall be proved that the Trustee
was negligent in ascertaining the pertinent facts;
(iii) the Trustee shall not be liable with
respect to any action taken or omitted to be taken by
it in good faith in accordance with the direction of
the Holders of a majority in principal amount of the
Outstanding Securities of any one or more series, as
provided herein, relating to the time, method and
place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or
power conferred upon the Trustee, under this
Indenture with respect to the Securities of such
series; and
(iv) no provision of this Indenture shall
require the Trustee to expend or risk its own funds
or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the
exercise of any of its rights or powers, if it shall
have reasonable grounds for believing that repayment
of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it.
(d) Whether or not therein expressly so
provided, every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the
Trustee shall be subject to the provisions of this Section.
SECTION 802. NOTICE OF DEFAULTS.
The Trustee shall give notice of any default
hereunder with respect to the Securities of any series to the
Holders of Securities of such series in the manner and to the
extent required to do so by the Trust Indenture Act, unless such
default shall have been cured or waived; provided, however, that in
the case of any default of the character specified in Section
701(c), no such notice to Holders shall be given until at least
seventy-five (75) days after the occurrence thereof; and provided,
further, that, subject to the provisions of Section 801, the
Trustee shall not be deemed to have knowledge of such default
unless either (i) a Responsible Officer of the Trustee shall have
actual knowledge of such default or (ii) the Trustee shall have
received written notice thereof from the Company or any Holder or,
in the case of a default described in Section 701(d), from the
holder of any indebtedness or from the trustee under any mortgage,
indenture or other instrument referred to in such Section. For the
purpose of this Section, the term "DEFAULT" means any event which
is, or after notice or lapse of time, or both, would become, an
Event of Default with respect to the Securities of such series.
SECTION 803. CERTAIN RIGHTS OF TRUSTEE.
Subject to the provisions of Section 801 and to the
applicable provisions of the Trust Indenture Act:
(a) the Trustee may rely and shall be
protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper
or document believed by it to be genuine and to have been
signed, sent or presented by the proper party or parties;
(b) any request, direction or act of the
Company mentioned herein shall be sufficiently evidenced by a
Company Request or Company Order, or as otherwise expressly
provided herein, and any resolution of the Board of Directors
may be sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this
Indenture the Trustee shall deem it desirable that a matter be
proved or established prior to taking, suffering or omitting
any action hereunder, the Trustee (unless other evidence is
specifically prescribed herein) may, in the absence of bad
faith on its part, rely upon an Officer's Certificate;
(d) the Trustee may consult with counsel and
the written advice of such counsel or any Opinion of Counsel
shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation
to exercise any of the rights or powers vested in it by this
Indenture at the request or direction of any Holder pursuant
to this Indenture, unless such Holder shall have offered to
the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by it
complying with such request or direction;
(f) the Trustee shall not be bound to make
any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper
or document, but the Trustee, in its discretion, may make such
further inquiry or investigation into such facts or matters as
it may see fit, and, if the Trustee shall determine to make
such further inquiry or investigation, it shall (subject to
applicable legal requirements) be entitled to examine, during
normal business hours, the books, records and premises of the
Company, personally or by agent or attorney;
(g) the Trustee may execute any of the
trusts or powers hereunder or perform any duties hereunder
either directly or by or through agents or attorneys and the
Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with
due care by it hereunder; and
(h) the Trustee shall not be charged with
knowledge of any Event of Default with respect to the
Securities of any series for which it is acting as Trustee
unless either (i) a Responsible Officer of the Trustee shall
have actual knowledge of the Event of Default or (ii) written
notice of such Event of Default shall have been given to the
Trustee by the Company, any other obligor on such Securities
or by any Holder of such Securities or, in the case of a
default described in Section 701(d), from the holder of any
indebtedness or from the trustee under any mortgage, indenture
or other instrument referred to in such Section.
SECTION 804. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE
OF SECURITIES.
The recitals contained herein and in the Securities
(except the Trustee's certificates of authentication) shall be
taken as the statements of the Company, and neither the Trustee nor
any Authenticating Agent assumes any responsibility for their
correctness. The Trustee makes no representations as to the
validity or sufficiency of this Indenture or of the Securities.
Neither the Trustee nor any Authenticating Agent shall be
accountable for the use or application by the Company of Securities
or the proceeds thereof.
SECTION 805. MAY HOLD SECURITIES.
Each of the Trustee, any Authenticating Agent, any
Paying Agent, any Security Registrar or any other agent of the
Company or the Trustee, in its individual or any other capacity,
may become the owner or pledgee of Securities and, subject to
Sections 808 and 813, may otherwise deal with the Company with the
same rights it would have if it were not such Trustee,
Authenticating Agent, Paying Agent, Security Registrar or other
agent.
SECTION 806. MONEY HELD IN TRUST.
Money held by the Trustee in trust hereunder need not
be segregated from other funds, except to the extent required by
law. The Trustee shall be under no liability for interest on or
investment of any money received by it hereunder except as
expressly provided herein or otherwise agreed with, and for the
sole benefit of, the Company.
SECTION 807. COMPENSATION AND REIMBURSEMENT.
The Company shall
(a) pay to the Trustee from time to time
reasonable compensation for all services rendered by it here-
under (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of
an express trust);
(b) except as otherwise expressly provided
herein, reimburse the Trustee upon its request for all reason-
able expenses, disbursements and advances reasonably incurred
or made by the Trustee in accordance with any provision of
this Indenture (including the reasonable compensation and the
expenses and disbursements of its agents and counsel), except
to the extent that any such expense, disbursement or advance
may be attributable to its negligence, wilful misconduct or
bad faith; and
(c) indemnify the Trustee and hold it
harmless from and against any loss, liability or expense
reasonably incurred by it arising out of or in connection with
the acceptance or administration of the trust or trusts here-
under or the performance of its duties hereunder, including
the reasonable costs and expenses of defending itself against
any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder, except
to the extent any such loss, liability or expense may be
attributable to its negligence, wilful misconduct or bad
faith.
As security for the performance of the obligations of
the Company under this Section, the Trustee shall have a lien prior
to the Securities upon all property and funds held or collected by
the Trustee as such other than property and funds held in trust
under Section 603 (except moneys payable to the Company as provided
in Section 603). "TRUSTEE" for purposes of this Section shall
include any predecessor Trustee; provided, however, that the
negligence, wilful misconduct or bad faith of any Trustee hereunder
shall not affect the rights of any other Trustee hereunder.
SECTION 808. DISQUALIFICATION; CONFLICTING INTERESTS.
If the Trustee shall have or acquire any conflicting
interest within the meaning of the Trust Indenture Act, it shall
either eliminate such conflicting interest or resign to the extent,
in the manner and with the effect, and subject to the conditions,
provided in the Trust Indenture Act and this Indenture. For
purposes of Section 310(b)(1) of the Trust Indenture Act and to the
extent permitted thereby, the Trustee, in its capacity as trustee
in respect of the Securities of any series, shall not be deemed to
have a conflicting interest arising from its capacity as trustee in
respect of the Securities of any other series. For purposes of
clause (i) of the first proviso contained in Section 310(b) of the
Trust Indenture Act, the Indenture, dated as of July 1, 1988,
between the Company and The Chase Manhattan Bank (formerly known as
Chemical Bank), trustee, shall be deemed to be specifically
described herein.
SECTION 809. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.
There shall at all times be a Trustee hereunder which
shall be
(a) a corporation organized and doing
business under the laws of the United States, any State or
Territory thereof or the District of Columbia, authorized
under such laws to exercise corporate trust powers, having a
combined capital and surplus of at least Fifty Million Dollars
($50,000,000) and subject to supervision or examination by
Federal, State, Territorial or District of Columbia authority,
or
(b) if and to the extent permitted by the
Commission by rule, regulation or order upon application, a
corporation or other Person organized and doing business under
the laws of a foreign government, authorized under such laws
to exercise corporate trust powers, having a combined capital
and surplus of at least Fifty Million Dollars ($50,000,000) or
the Dollar equivalent of the applicable foreign currency and
subject to supervision or examination by authority of such
foreign government or a political subdivision thereof
substantially equivalent to supervision or examination
applicable to United States institutional trustees,
and, in either case, qualified and eligible under this Article and
the Trust Indenture Act. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements
of such supervising or examining authority, then for the purposes
of this Section, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus
as set forth in its most recent report of condition so published.
If at any time the Trustee shall cease to be eligible in accordance
with the provisions of this Section or the Trust Indenture Act, it
shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
SECTION 810. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) No resignation or removal of the Trustee
and no appointment of a successor Trustee pursuant to this Article
shall become effective until the acceptance of appointment by the
successor Trustee in accordance with the applicable requirements of
Section 811.
(b) The Trustee may resign at any time with
respect to the Securities of one or more series by giving written
notice thereof to the Company. If the instrument of acceptance by
a successor Trustee required by Section 811 shall not have been
delivered to the Trustee within thirty (30) days after the giving
of such notice of resignation, the resigning Trustee may petition
any court of competent jurisdiction for the appointment of a
successor Trustee with respect to the Securities of such series.
(c) The Trustee may be removed at any time with
respect to the Securities of any series by Act of the Holders of a
majority in principal amount of the Outstanding Securities of such
series delivered to the Trustee and to the Company.
(d) If at any time:
(i) the Trustee shall fail to comply with Section
808 after written request therefor by the Company or
by any Holder who has been a bona fide Holder for at
least six months, or
(ii) the Trustee shall cease to be eligible under
Section 809 or Section 310(a) of the Trust Indenture
Act and shall fail to resign after written request
therefor by the Company or by any such Holder, or
(iii) the Trustee shall become incapable of acting
or shall be adjudged a bankrupt or insolvent or a re-
ceiver of the Trustee or of its property shall be ap-
pointed or any public officer shall take charge or
control of the Trustee or of its property or affairs
for the purpose of rehabilitation, conservation or
liquidation,
then, in any such case, (x) the Company by a Board Resolution may
remove the Trustee with respect to all Securities or (y) subject to
Section 714, any Holder who has been a bona fide Holder for at
least six (6) months may, on behalf of itself and all others
similarly situated, petition any court of competent jurisdiction
for the removal of the Trustee with respect to all Securities and
the appointment of a successor Trustee or Trustees.
(e) If the Trustee shall resign, be removed or
become incapable of acting, or if a vacancy shall occur in the
office of Trustee for any cause (other than as contemplated in
clause (y) in subsection (d) of this Section), with respect to the
Securities of one or more series, the Company, by a Board
Resolution, shall take prompt steps to appoint a successor Trustee
or Trustees with respect to the Securities of that or those series
(it being understood that any such successor Trustee may be
appointed with respect to the Securities of one or more or all of
such series and that at any time there shall be only one Trustee
with respect to the Securities of any particular series) and shall
comply with the applicable requirements of Section 811. If, within
one (1) year after such resignation, removal or incapability, or
the occurrence of such vacancy, a successor Trustee with respect to
the Securities of any series shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding
Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon
its acceptance of such appointment in accordance with the
applicable requirements of Section 811, become the successor
Trustee with respect to the Securities of such series and to that
extent supersede the successor Trustee appointed by the Company.
If no successor Trustee with respect to the Securities of any
series shall have been so appointed by the Company or the Holders
and accepted appointment in the manner required by Section 811, any
Holder who has been a bona fide Holder of a Security of such series
for at least six (6) months may, on behalf of itself and all others
similarly situated, petition any court of competent jurisdiction
for the appointment of a successor Trustee with respect to the
Securities of such series.
(f) So long as no event which is, or after notice or
lapse of time, or both, would become, an Event of Default shall
have occurred and be continuing, if the Company shall have
delivered to the Trustee with respect to the Securities of one or
more series (i) a Board Resolution appointing a successor Trustee
or Trustees with respect to that or those series, effective as of a
date specified therein, and (ii) an instrument of acceptance of
such appointment, effective as of such date, by such successor
Trustee or Trustees in accordance with Section 811, the Trustee or
Trustees with respect to that or those series shall be deemed to
have resigned as contemplated in subsection (b) of this Section,
the successor Trustee or Trustees shall be deemed to have been
appointed pursuant to subsection (e) of this Section and such
appointment shall be deemed to have been accepted as contemplated
in Section 811, all as of such date, and all other provisions of
this Section and Section 811 shall be applicable to such
resignation, appointment and acceptance except to the extent
inconsistent with this subsection (f).
(g) The Company shall give notice of each
resignation and each removal of the Trustee with respect to the
Securities of any series and each appointment of a successor
Trustee with respect to the Securities of any series to all Holders
of Securities of such series. Each notice shall include the name
of the successor Trustee with respect to the Securities of such
series and the address of its corporate trust office.
SECTION 811. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
(a) In case of the appointment hereunder of
a successor Trustee with respect to the Securities of all series,
every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Trustee
an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Trustee shall become
effective and such successor Trustee, without any further act,
shall become vested with all the rights, powers, trusts and duties
of the retiring Trustee; but, on the request of the Company or the
successor Trustee, such retiring Trustee shall, upon payment of all
sums owed to it, execute and deliver an instrument transferring to
such successor Trustee all the rights, powers and trusts of the
retiring Trustee and shall duly assign, transfer and deliver to
such successor Trustee all property and money held by such retiring
Trustee hereunder.
(b) In case of the appointment hereunder of
a successor Trustee with respect to the Securities of one or more
(but not all) series, the Company, the retiring Trustee and each
successor Trustee with respect to the Securities of such series
shall execute and deliver an indenture supplemental hereto wherein
each successor Trustee shall accept such appointment and which
(1) shall contain such provisions as shall be necessary or
desirable to transfer and confirm to, and to vest in, each
successor Trustee all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or those
series to which the appointment of such successor Trustee relates,
(2) if the retiring Trustee is not retiring with respect to all
Securities, shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers,
trusts and duties of the retiring Trustee with respect to the
Securities of that or those series as to which the retiring Trustee
is not retiring shall continue to be vested in the retiring Trustee
and (3) shall add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee, it
being understood that nothing herein or in such supplemental
indenture shall constitute such Trustees co-trustees of the same
trust and that each such Trustee shall be trustee of a trust or
trusts hereunder separate and apart from any trust or trusts here-
under administered by any other such Trustee; and upon the
execution and delivery of such supplemental indenture the
resignation or removal of the retiring Trustee shall become
effective to the extent provided therein and each such successor
Trustee, without any further act, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series to which the
appointment of such successor Trustee relates; but, on request of
the Company or any successor Trustee, such retiring Trustee, upon
payment of all sums owed to it, shall duly assign, transfer and
deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder with respect to the Securities of
that or those series to which the appointment of such successor
Trustee relates.
(c) Upon reasonable request of any such
successor Trustee, the Company shall execute instruments to more
fully and certainly vest in and confirm to such successor Trustee
all rights, powers and trusts referred to in subsection (a) or (b)
of this Section, as the case may be.
(d) No successor Trustee shall accept its
appointment unless at the time of such acceptance such successor
Trustee shall be qualified and eligible under this Article.
SECTION 812. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION
TO BUSINESS.
Any corporation into which the Trustee may be merged
or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or consolidation
to which the Trustee shall be a party, or any corporation
succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible
under this Article, without the execution or filing of any paper or
any further act on the part of any of the parties hereto. In case
any Securities shall have been authenticated, but not delivered, by
the Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the
same effect as if such successor Trustee had itself authenticated
such Securities.
SECTION 813. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
If the Trustee shall be or become a creditor of the
Company or any other obligor upon the Securities (other than by
reason of a relationship described in Section 311(b) of the Trust
Indenture Act), the Trustee shall be subject to any and all
applicable provisions of the Trust Indenture Act regarding the
collection of claims against the Company or such other obligor.
For purposes of Section 311(b) of the Trust Indenture Act:
(a) the term "CASH TRANSACTION" means any
transaction in which full payment for goods or securities sold
is made within seven days after delivery of the goods or
securities in currency or in checks or other orders drawn upon
banks or bankers and payable upon demand; and
(b) the term "SELF-LIQUIDATING PAPER" means
any draft, bill of exchange, acceptance or obligation which is
made, drawn, negotiated or incurred by the Company or such
obligor for the purpose of financing the purchase, processing,
manufacturing, shipment, storage or sale of goods, wares or
merchandise and which is secured by documents evidencing title
to, possession of, or a lien upon, the goods, wares or
merchandise or the receivables or proceeds arising from the
sale of the goods, wares or merchandise previously
constituting the security, provided the security is received
by the Trustee simultaneously with the creation of the
creditor relationship with the Company or such obligor arising
from the making, drawing, negotiating or incurring of the
draft, bill of exchange, acceptance or obligation.
SECTION 814. APPOINTMENT OF AUTHENTICATING AGENT.
The Trustee may appoint an Authenticating Agent or
Agents with respect to the Securities of one or more series, or any
Tranche thereof, which shall be authorized to act on behalf of the
Trustee to authenticate Securities of such series or Tranche issued
upon original issuance, exchange, registration of transfer or
partial redemption thereof or pursuant to Section 306, and
Securities so authenticated shall be entitled to the benefits of
this Indenture and shall be valid and obligatory for all purposes
as if authenticated by the Trustee hereunder. Wherever reference
is made in this Indenture to the authentication and delivery of
Securities by the Trustee or the Trustee's certificate of
authentication, such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed
on behalf of the Trustee by an Authenticating Agent. Each
Authenticating Agent shall be acceptable to the Company and shall
at all times be a corporation organized and doing business under
the laws of the United States, any State or Territory thereof or
the District of Columbia or the Commonwealth of Puerto Rico,
authorized under such laws to act as Authenticating Agent, having a
combined capital and surplus of not less than Fifty Million Dollars
($50,000,000) and subject to supervision or examination by Federal
or State authority. If such Authenticating Agent publishes reports
of condition at least annually, pursuant to law or to the
requirements of said supervising or examining authority, then for
the purposes of this Section, the combined capital and surplus of
such Authenticating Agent shall be deemed to be its combined
capital and surplus as set forth in its most recent report of
condition so published. If at any time an Authenticating Agent
shall cease to be eligible in accordance with the provisions of
this Section, such Authenticating Agent shall resign immediately in
the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent
may be merged or converted or with which it may be consolidated, or
any corporation resulting from any merger, conversion or
consolidation to which such Authenticating Agent shall be a party,
or any corporation succeeding to all or substantially all of the
corporate agency or corporate trust business of an Authenticating
Agent, shall continue to be an Authenticating Agent, provided such
corporation shall be otherwise eligible under this Section, without
the execution or filing of any paper or any further act on the part
of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by
giving written notice thereof to the Trustee and to the Company.
The Trustee may at any time terminate the agency of an
Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Company. Upon receiving such a
notice of resignation or upon such a termination, or in case at any
time such Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section, the Trustee may
appoint a successor Authenticating Agent which shall be acceptable
to the Company. Any successor Authenticating Agent upon acceptance
of its appointment hereunder shall become vested with all the
rights, powers and duties of its predecessor hereunder, with like
effect as if originally named as an Authenticating Agent. No
successor Authenticating Agent shall be appointed unless eligible
under the provisions of this Section.
The Company agrees to pay to each Authenticating
Agent from time to time reasonable compensation for its services
under this Section.
The provisions of Sections 308, 804 and 805 shall be
applicable to each Authenticating Agent.
If an appointment with respect to the Securities of
one or more series, or any Tranche thereof, shall be made pursuant
to this Section, the Securities of such series or Tranche may have
endorsed thereon, in addition to the Trustee's certificate of
authentication, an alternate certificate of authentication
substantially in the following form:
This is one of the Securities of the series
designated therein referred to in the within-mentioned Indenture.
________________________
As Trustee
By______________________
As Authenticating Agent
By______________________
Authorized Officer
If all of the Securities of a series may not be
originally issued at one time, and if the Trustee does not have an
office capable of authenticating Securities upon original issuance
located in a Place of Payment where the Company wishes to have
Securities of such series authenticated upon original issuance, the
Trustee, if so requested by the Company in writing (which writing
need not comply with Section 102 and need not be accompanied by an
Opinion of Counsel), shall appoint, in accordance with this Section
and in accordance with such procedures as shall be acceptable to
the Trustee, an Authenticating Agent having an office in a Place of
Payment designated by the Company with respect to such series of
Securities.
ARTICLE NINE
LISTS OF HOLDERS; REPORTS BY TRUSTEE AND COMPANY
SECTION 901. LISTS OF HOLDERS.
Semiannually, not later than June 30 and December 31
in each year, commencing December 31, 1998, and within 30 days of
such other times as the Trustee may request in writing, the Company
shall furnish or cause to be furnished to the Trustee information
as to the names and addresses of the Holders, as of a date no more
than fifteen (15) days prior to the date such information is so
furnished, and the Trustee shall preserve such information and
similar information received by it in any other capacity and afford
to the Holders access to information so preserved by it, all to
such extent, if any, and in such manner as shall be required by the
Trust Indenture Act; provided, however, that no such list need be
furnished so long as the Trustee shall be the Security Registrar.
SECTION 902. REPORTS BY TRUSTEE AND COMPANY.
Not later than November 15 in each year, commencing
November 15, 1998, the Trustee shall transmit to the Holders, the
Commission and each securities exchange upon which any Securities
are listed, a report, dated as of the next preceding September 15,
with respect to any events and other matters described in Section
313(a) of the Trust Indenture Act, in such manner and to the extent
required by the Trust Indenture Act. The Trustee shall transmit to
the Holders, the Commission and each securities exchange upon which
any Securities are listed, and the Company shall file with the
Trustee (within thirty (30) days after filing with the Commission
in the case of reports which pursuant to the Trust Indenture Act
must be filed with the Commission and furnished to the Trustee) and
transmit to the Holders, such other information, reports and other
documents, if any, at such times and in such manner, as shall be
required by the Trust Indenture Act. The Company shall notify the
Trustee of the listing of any Securities on any securities
exchange.
ARTICLE TEN
CONSOLIDATION, MERGER, CONVEYANCE
OR OTHER TRANSFER
SECTION 1001. COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN
TERMS.
The Company shall not consolidate with or merge into
any other Person, or convey or otherwise transfer, or lease, all of
its properties, as or substantially as an entirety, to any Person,
unless:
(a) the Person formed by such consolidation
or into which the Company is merged or the Person which
acquires by conveyance or other transfer, or which leases (for
a term extending beyond the last Stated Maturity of the
Securities then Outstanding), all of the properties of the
Company, as or substantially as an entirety, shall be a Person
organized and existing under the laws of the United States,
any State or Territory thereof or the District of Columbia or
under the laws of Canada or any Province thereof (such
corporation being hereinafter sometimes called the
"SUCCESSOR") and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in
form reasonably satisfactory to the Trustee, the due and
punctual payment of the principal of and premium, if any, and
interest, if any, on all the Securities then Outstanding and
the performance and observance of every covenant and condition
of this Indenture to be performed or observed by the Company;
and
(b) the Company shall have delivered to the
Trustee an Officer's Certificate and an Opinion of Counsel,
each of which shall state that such consolidation, merger,
conveyance or other transfer or lease, and such supplemental
indenture, comply with this Article and that all conditions
precedent herein provided for relating to such transaction
have been complied with.
Anything in this Indenture to the contrary
notwithstanding, the conveyance or other transfer, or lease, by the
Company of all of its facilities (a) for the generation of electric
energy, (b) for the transmission of electric energy or (c) for the
distribution of electric energy and/or natural gas, in each case
considered alone, or all of its facilities described in clauses (a)
and (b), considered together, or all of its facilities described in
clauses (b) and (c), considered together, shall in no event be
deemed to constitute a conveyance or other transfer, or lease, of
all the properties of the Company, as or substantially as an
entirety, unless, immediately following such conveyance, transfer
or lease, the Company shall own no unleased properties in the other
such categories of property not so conveyed or otherwise
transferred or leased. The character of particular facilities
shall be determined by reference to the Uniform System of Accounts
prescribed for public utilities and licensees subject to the
Federal Power Act, as amended, to the extent applicable.
SECTION 1002. SUCCESSOR SUBSTITUTED.
Upon any consolidation or merger or any conveyance
or other transfer of all the properties of the Company, as or
substantially as an entirety, in accordance with Section 1001, the
Successor shall succeed to, and be substituted for, and may
exercise every power and right of, the Company under this Indenture
with the same effect as if such Successor had been named as the
"Company" herein. Without limiting the generality of the
foregoing, the Successor may execute and deliver to the Trustee,
and thereupon the Trustee shall, subject to the provisions of
Article Three, authenticate and deliver, Securities. All
Securities so executed by the Successor, and authenticated and
delivered by the Trustee, shall in all respects be entitled to the
benefits provided by this Indenture equally and ratably with all
Securities executed, authenticated and delivered prior to the time
such consolidation, merger, conveyance or other transfer became
effective.
SECTION 1003. RELEASE OF COMPANY UPON CONVEYANCE OR OTHER
TRANSFER.
In the case of a conveyance or other transfer to any
Person or Persons as contemplated in Section 1001, upon the
satisfaction of all the conditions specified in Section 1001 the
Company (such term being used in this Section without giving effect
to such transaction) shall be released and discharged from all
obligations and covenants under this Indenture and on and under all
Securities then Outstanding (unless the Company shall have
delivered to the Trustee an instrument in which it shall waive such
release and discharge) and the Trustee shall acknowledge in writing
that the Company has been so released and discharged.
SECTION 1004. MERGER INTO COMPANY.
Nothing in this Indenture shall be deemed to prevent
or restrict any consolidation or merger after the consummation of
which the Company would be the surviving or resulting entity or any
conveyance or other transfer, or lease of any part of the
properties of the Company which does not constitute the entirety,
or substantially the entirety, thereof.
SECTION 1005. TRANSFER OF LESS THAN THE ENTIRETY.
(a) If the Company shall have conveyed or otherwise
transferred any part of its properties which does not constitute
the entirety, or substantially the entirety, thereof to another
Person meeting the requirements set forth in clause (a) of the
first paragraph of Section 1001 and if:
(i) the transferee of such part of the
properties of the Company shall have executed and delivered to
the Trustee an indenture supplemental hereto, in form
reasonably satisfactory to the Trustee, which contains an
assumption by such transferee of the due and punctual payment
of the principal of and premium, if any, and interest, if any,
on all the Securities then Outstanding and the performance and
observance of every covenant and condition of this Indenture
to be performed or observed by the Company;
(ii) there shall have been delivered to the
Trustee an Independent Expert's Certificate
(A) describing the property so conveyed or
otherwise transferred (such description of property
to be made by reference either to specific items,
units and/or elements of property or portions
thereof, on a percentage or Dollar basis, or to
properties reflected in specified accounts in the
Company's books of account or portions thereof, on a
Dollar basis); provided, however, that such property
shall be identified in such certificate as facilities
for the generation, transmission or distribution of
electric energy or for the storage, transportation or
distribution of natural gas;
(B) stating, in the judgment of the signers,
the Fair Value to the transferee of the property so
conveyed or otherwise transferred; provided, however,
that there shall be excluded from the property so
evaluated any property subject to any mortgage, deed
of trust, security interest or other lien which
secures indebtedness for borrowed money or for the
deferred purchase price of property;
(C) stating an amount equal to seventy
percent (70%) of the amount stated pursuant to clause
(B) above;
(D) stating an amount equal to the aggregate
principal amount of the Securities then Outstanding;
and
(E) stating that the amount stated pursuant
to clause (D) above does not exceed the amount stated
pursuant to clause (C) above; and
(iii) the Company shall have delivered to the
Trustee an Officer's Certificate and an Opinion of Counsel
each of which shall state that such conveyance or other
transfer and such supplemental indenture comply with this
Section and that all conditions precedent relating to such
transactions provided for in this Section and otherwise in
this Indenture have been complied with;
then, upon the satisfaction of all such conditions,
(x) the Company shall be released and
discharged from all obligations and covenants under this
Indenture and on and under all Securities then Outstanding
(unless the Company shall have delivered to the Trustee an
instrument in which it shall waive such release and
discharge), and the Trustee shall acknowledge in writing that
the Company has been so released and discharged; and
(y) if the Company shall have been released
and discharged as contemplated in clause (x) above, such
transferee shall succeed to, and be substituted for, and may
exercise every right and power of, the Company under this
Indenture with the same effect as if such transferee had been
named the "Company" herein; and without limiting the
generality of the foregoing, such transferee shall be deemed a
"Successor" for purposes of Section 1002 and for all other
purposes of this Indenture.
(b) For purposes of this Section:
"FAIR VALUE" means the fair value of such property
so conveyed or otherwise transferred as may be
determined by reference to (a) the amount which would
be likely to be obtained in an arm's-length
transaction with respect to such property between an
informed and willing buyer and an informed and
willing seller, under no compulsion, respectively, to
buy or sell, (b) the amount of investment with
respect to such property which, together with a
reasonable return thereon, would be likely to be
recovered through ordinary business operations or
otherwise, (c) the cost, accumulated depreciation and
replacement cost with respect to such property and/or
(d) any other relevant factors; provided, however,
that (x) the Fair Value of property shall be
determined without deduction for any mortgage, deed
of trust, pledge, security interest, encumbrance,
lease, reservation, restriction, servitude, charge or
similar right or any other lien of any kind on such
property and (y) the Fair Value to the transferee of
any property shall not reflect any reduction relating
to the fact that such property may be of less value
to a Person which is not the owner or operator of the
property or any portion thereof than to a Person
which is such owner or operator. Fair Value may be
determined, without physical inspection, by the use
of accounting and engineering records and other data
maintained by the Company or the transferee or
otherwise available to the Expert certifying the
same.
"INDEPENDENT EXPERT'S CERTIFICATE" means a
certificate signed by an authorized officer of the
transferee and by an Independent Expert (which
Independent Expert shall be selected either by the
board of directors or by an authorized officer of the
transferee, the execution of such certificate by such
authorized officer to be conclusive evidence of such
selection) and delivered to the Trustee. For
purposes of this definition, (a) "EXPERT" means a
Person which is an engineer, appraiser or other
expert and which, with respect to any certificate to
be signed by such Person and delivered to the
Trustee, is qualified to pass upon the matter set
forth in such certificate; (b) "ENGINEER" means a
Person engaged in the engineering profession or
otherwise qualified to pass upon engineering matters
(including, but not limited to, a Person licensed as
a professional engineer, whether or not then engaged
in the engineering profession) and (c) "APPRAISER"
means a Person engaged in the business of appraising
property or otherwise qualified to pass upon the Fair
Value or fair market value of property.
"INDEPENDENT", when applied to any Expert, means such
a Person who (a) is in fact independent, (b) does not
have any direct material financial interest in the
transferee or in any obligor upon the Securities or
in any Affiliate of the transferee, (c) is not
connected with the transferee or such other obligor
as an officer, employee, promoter, underwriter,
trustee, partner, director or any person performing
similar functions and (d) is approved by the Trustee
in the exercise of reasonable care.
ARTICLE ELEVEN
SUPPLEMENTAL INDENTURES
SECTION 1101. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holders, the Company and
the Trustee, at any time and from time to time, may enter into one
or more indentures supplemental hereto, in form reasonably
satisfactory to the Trustee, for any of the following purposes:
(a) to evidence the succession of another
Person to the Company and the assumption by any such
successor of the covenants of the Company herein and
in the Securities, all as provided in Article Ten; or
(b) to add one or more covenants of the
Company or other provisions for the benefit of all
Holders or for the benefit of the Holders of, or to
remain in effect only so long as there shall be
Outstanding, Securities of one or more specified
series, or one or more specified Tranches thereof, or
to surrender any right or power herein conferred upon
the Company; or
(c) to change or eliminate any provision of
this Indenture or to add any new provision to this
Indenture; provided, however, that if such change,
elimination or addition shall adversely affect the
interests of the Holders of Securities of any series
or Tranche in any material respect, such change,
elimination or addition shall become effective with
respect to such series or Tranche only when no
Security of such series or Tranche remains
Outstanding; or
(d) to provide collateral security for the
Securities or any series thereof; or
(e) to establish the form or terms of
Securities of any series or Tranche as contemplated
by Sections 201 and 301; or
(f) to provide for the authentication and
delivery of bearer securities and coupons
appertaining thereto representing interest, if any,
thereon and for the procedures for the registration,
exchange and replacement thereof and for the giving
of notice to, and the solicitation of the vote or
consent of, the holders thereof, and for any and all
other matters incidental thereto; or
(g) to evidence and provide for the
acceptance of appointment hereunder by a successor
Trustee with respect to the Securities of one or more
series and to add to or change any of the provisions
of this Indenture as shall be necessary to provide
for or facilitate the administration of the trusts
hereunder by more than one Trustee, pursuant to the
requirements of Section 811(b); or
(h) to provide for the procedures required
to permit the Company to utilize, at its option, a
non-certificated system of registration for all, or
any series or Tranche of, the Securities; or
(i) to change any place or places where (1)
the principal of and premium, if any, and interest,
if any, on all or any series of Securities, or any
Tranche thereof, shall be payable, (2) all or any
series of Securities, or any Tranche thereof, may be
surrendered for registration of transfer, (3) all or
any series of Securities, or any Tranche thereof, may
be surrendered for exchange and (4) notices and
demands to or upon the Company in respect of all or
any series of Securities, or any Tranche thereof, and
this Indenture may be served; or
(j) to cure any ambiguity, to correct or
supplement any provision herein which may be
defective or inconsistent with any other provision
herein; or to make any other changes to the
provisions hereof or to add other provisions with
respect to matters or questions arising under this
Indenture, provided that such other changes or
additions shall not adversely affect the interests of
the Holders of Securities of any series or Tranche in
any material respect.
Without limiting the generality of the foregoing, if
the Trust Indenture Act as in effect at the date of the execution
and delivery of this Indenture or at any time thereafter shall be
amended and
(x) if any such amendment shall require one
or more changes to any provisions hereof or the
inclusion herein of any additional provisions, or
shall by operation of law be deemed to effect such
changes or incorporate such provisions by reference
or otherwise, this Indenture shall be deemed to have
been amended so as to conform to such amendment to
the Trust Indenture Act, and the Company and the
Trustee may, without the consent of any Holders,
enter into an indenture supplemental hereto to
evidence such amendment hereof; or
(y) if any such amendment shall permit one
or more changes to, or the elimination of, any
provisions hereof which, at the date of the execution
and delivery hereof or at any time thereafter, are
required by the Trust Indenture Act to be contained
herein or are contained herein to reflect any
provisions of the Trust Indenture Act as in effect at
such date, this Indenture shall be deemed to have
been amended to effect such changes or elimination,
and the Company and the Trustee may, without the
consent of any Holders, enter into an indenture
supplemental hereto to amend this Indenture to effect
such changes or elimination.
SECTION 1102. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.
Subject to the provisions of Section 1101, with the
consent of the Holders of a majority in aggregate principal amount
of the Securities of all series then Outstanding under this
Indenture, considered as one class, by Act of said Holders de-
livered to the Company and the Trustee, the Company and the Trustee
may enter into an indenture or indentures supplemental hereto for
the purpose of adding any provisions to, or changing in any manner
or eliminating any of the provisions of, this Indenture; provided,
however, that if there shall be Securities of more than one series
Outstanding hereunder and if a proposed supplemental indenture
shall directly affect the rights of the Holders of Securities of
one or more, but less than all, of such series, then the consent
only of the Holders of a majority in aggregate principal amount of
the Outstanding Securities of all series so directly affected,
considered as one class, shall be required; and provided, further,
that if the Securities of any series shall have been issued in more
than one Tranche and if the proposed supplemental indenture shall
directly affect the rights of the Holders of Securities of one or
more, but less than all, of such Tranches, then the consent only of
the Holders of a majority in aggregate principal amount of the
Outstanding Securities of all Tranches so directly affected,
considered as one class, shall be required; and provided, further,
that no such supplemental indenture shall:
(a) change the Stated Maturity of the
principal of, or any installment of principal of or
interest on, any Security other than pursuant to the
terms thereof, or reduce the principal amount thereof
or the rate of interest thereon (or the amount of any
installment of interest thereon) or change the method
of calculating such rate or reduce any premium
payable thereon, or reduce the amount of the
principal of any Discount Security that would be due
and payable upon a declaration of acceleration of the
Maturity thereof pursuant to Section 702, or change
the coin or currency (or other property), in which
any Security or premium, if any, or interest, if any,
thereon is payable, or impair the right to institute
suit for the enforcement of any such payment on or
after the Maturity of any Security, without, in any
such case, the consent of the Holder of such
Security; or
(b) reduce the percentage in principal
amount of the Outstanding Securities of any series,
or any Tranche thereof, the consent of the Holders of
which is required for any such supplemental in-
denture, or the consent of the Holders of which is
required for any waiver of compliance with any
provision of this Indenture or of any default
hereunder and its consequences, or reduce the
requirements of Section 1204 for quorum or voting,
without, in any such case, the consent of the Holder
of each Outstanding Security of such series or
Tranche; or
(c) modify any of the provisions of this
Section, Section 506 or Section 713 with respect to
the Securities of any series or any Tranche thereof
(except to increase the percentages in principal
amount referred to in this Section or such other
Sections or to provide that other provisions of this
Indenture cannot be modified or waived without the
consent of the Holders of all Securities of such
series or Tranche) without, in any such case, the
consent of the Holder of each Outstanding Security of
such series or Tranche; provided, however, that this
clause shall not be deemed to require the consent of
any Holder with respect to changes in the references
to "the Trustee" and concomitant changes in this
Section, or the deletion of this proviso, in
accordance with the requirements of Sections 811(b)
and 1101(g).
A supplemental indenture which (x) changes or
eliminates any covenant or other provision of this Indenture which
has expressly been included solely for the benefit of the Holders
of, or which is to remain in effect only so long as there shall be
Outstanding, Securities of one or more specified series, or one or
more Tranches thereof, or (y) modifies the rights of the Holders of
Securities of such series or Tranches with respect to such covenant
or other provision, shall be deemed not to affect the rights under
this Indenture of the Holders of Securities of any other series or
Tranche.
It shall not be necessary for any Act of Holders
under this Section to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such Act
shall approve the substance thereof.
Anything in this Indenture to the contrary notwithstanding, if
the Officer's Certificate, supplemental indenture or Board
Resolution, as the case may be, establishing the Securities of any
series or Tranche shall so provide, (a) the Holders of such
Securities shall be deemed to have consented to a supplemental
indenture containing the additions, changes or eliminations to or
from the Indenture which shall be specified in such Officer's
Certificate, supplemental indenture or Board Resolution
establishing such series or Tranche, (b) no Act of such Holders
shall be required to evidence such consent and (c) such consent may
be counted in the determination of whether or not the Holders of
the requisite principal amount of Securities shall have consented
to such supplemental indenture.
SECTION 1103. EXECUTION OF SUPPLEMENTAL INDENTURES.
In executing, or accepting the additional trusts
created by, any supplemental indenture permitted by this Article or
the modifications thereby of the trusts created by this Indenture,
the Trustee shall be entitled to receive, and (subject to Section
801) shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of such supplemental indenture
is authorized or permitted by this Indenture. The Trustee may, but
shall not be obligated to, enter into any such supplemental
indenture which affects the Trustee's own rights, duties,
immunities or liabilities under this Indenture or otherwise.
SECTION 1104. EFFECT OF SUPPLEMENTAL INDENTURES.
Upon the execution and delivery of any supplemental
indenture under this Article this Indenture shall be modified in
accordance therewith, and such supplemental indenture shall form a
part of this Indenture for all purposes; and every Holder of
Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby. Any supplemental indenture
permitted by this Article may restate this Indenture in its
entirety, and, upon the execution and delivery thereof, any such
restatement shall supersede this Indenture as theretofore in effect
for all purposes.
SECTION 1105. CONFORMITY WITH TRUST INDENTURE ACT.
Every supplemental indenture executed pursuant to
this Article shall conform to the requirements of the Trust
Indenture Act.
SECTION 1106. REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES.
Securities of any series, or any Tranche thereof,
authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article may, and shall if required by
the Trustee, bear a notation in form approved by the Trustee as to
any matter provided for in such supplemental indenture. If the
Company shall so determine, new Securities of any series, or any
Tranche thereof, so modified as to conform, in the opinion of the
Trustee and the Company, to any such supplemental indenture may be
prepared and executed by the Company and authenticated and
delivered by the Trustee in exchange for Outstanding Securities of
such series or Tranche.
SECTION 1107. MODIFICATION WITHOUT SUPPLEMENTAL INDENTURE.
To the extent, if any, that the terms of any
particular series of Securities shall have been established in or
pursuant to a Board Resolution or an Officer's Certificate pursuant
to a supplemental indenture or a Board Resolution as contemplated
by Section 301, and not in a supplemental indenture, additions to,
changes in or the elimination of any of such terms may be effected
by means of a supplemental Board Resolution or a supplemental
Officer's Certificate, as the case may be, delivered to, and
accepted by, the Trustee; provided, however, that such supplemental
Board Resolution or supplemental Officer's Certificate shall not be
accepted by the Trustee or otherwise be effective unless all
conditions set forth in this Indenture which would be required to
be satisfied if such additions, changes or elimination were
contained in a supplemental indenture shall have been appropriately
satisfied. Upon the acceptance thereof by the Trustee, any such
supplemental Board Resolution or supplemental Officer's Certificate
shall be deemed to be a "supplemental indenture" for purposes of
Section 1104 and 1106.
ARTICLE TWELVE
MEETINGS OF HOLDERS; ACTION WITHOUT MEETING
SECTION 1201. PURPOSES FOR WHICH MEETINGS MAY BE CALLED.
A meeting of Holders of Securities of one or more, or
all, series, or any Tranche or Tranches thereof, may be called at
any time and from time to time pursuant to this Article to make,
give or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be
made, given or taken by Holders of Securities of such series or
Tranches.
SECTION 1202. CALL, NOTICE AND PLACE OF MEETINGS.
(a) The Trustee may at any time call a
meeting of Holders of Securities of one or more, or all, series, or
any Tranche or Tranches thereof, for any purpose specified in
Section 1201, to be held at such time and (except as provided in
subsection (b) of this Section) at such place in the Borough of
Manhattan, The City of New York, as the Trustee shall determine,
or, with the approval of the Company, at any other place. Notice
of every such meeting, setting forth the time and the place of such
meeting and in general terms the action proposed to be taken at
such meeting, shall be given, in the manner provided in Section
106, not less than twenty-one (21) nor more than one hundred eighty
(180) days prior to the date fixed for the meeting.
(b) The Trustee may be asked to call a
meeting of the Holders of Securities of one or more, or all,
series, or any Tranche or Tranches thereof, by the Company or by
the Holders of thirty-three per centum (33%) in aggregate principal
amount of all of such series and Tranches, considered as one class,
for any purpose specified in Section 1201, by written request
setting forth in reasonable detail the action proposed to be taken
at the meeting. If the Trustee shall have been asked by the
Company to call such a meeting, the Company shall determine the
time and place for such meeting and may call such meeting by giving
notice thereof in the manner provided in subsection (a) of this
Section, or shall direct the Trustee, in the name and at the
expense of the Company, to give such notice. If the Trustee shall
have been asked to call such a meeting by Holders in accordance
with this subsection (b), and the Trustee shall not have given the
notice of such meeting within twenty-one (21) days after receipt of
such request or shall not thereafter proceed to cause the meeting
to be held as provided herein, then the Holders of Securities of
such series and Tranches, in the principal amount above specified,
may determine the time and the place in the Borough of Manhattan,
The City of New York, or in such other place as shall be determined
or approved by the Company, for such meeting and may call such
meeting for such purposes by giving notice thereof as provided in
subsection (a) of this Section.
(c) Any meeting of Holders of Securities of
one or more, or all, series, or any Tranche or Tranches thereof,
shall be valid without notice if the Holders of all Outstanding
Securities of such series or Tranches are present in person or by
proxy and if representatives of the Company and the Trustee are
present, or if notice is waived in writing before or after the
meeting by the Holders of all Outstanding Securities of such
series, or any Tranche or Tranches thereof, or by such of them as
are not present at the meeting in person or by proxy, and by the
Company and the Trustee.
SECTION 1203. PERSONS ENTITLED TO VOTE AT MEETINGS.
To be entitled to vote at any meeting of Holders of
Securities of one or more, or all, series, or any Tranche or
Tranches thereof, a Person shall be (a) a Holder of one or more
Outstanding Securities of such series or Tranches, or (b) a Person
appointed by an instrument in writing as proxy for a Holder or
Holders of one or more Outstanding Securities of such series or
Tranches by such Holder or Holders. The only Persons who shall be
entitled to attend any meeting of Holders of Securities of any
series or Tranche shall be the Persons entitled to vote at such
meeting and their counsel, any representatives of the Trustee and
its counsel and any representatives of the Company and its counsel.
SECTION 1204. QUORUM; ACTION.
The Persons entitled to vote a majority in aggregate
principal amount of the Outstanding Securities of the series and
Tranches with respect to which a meeting shall have been called as
hereinbefore provided, considered as one class, shall constitute a
quorum for a meeting of Holders of Securities of such series and
Tranches; provided, however, that if any action is to be taken at
such meeting which this Indenture expressly provides may be taken
by the Holders of a specified percentage, which is less than a
majority, in principal amount of the Outstanding Securities of such
series and Tranches, considered as one class, the Persons entitled
to vote such specified percentage in principal amount of the
Outstanding Securities of such series and Tranches, considered as
one class, shall constitute a quorum. In the absence of a quorum
within one hour of the time appointed for any such meeting, the
meeting shall, if convened at the request of Holders of Securities
of such series and Tranches, be dissolved. In any other case the
meeting may be adjourned for such period as may be determined by
the chairman of the meeting prior to the adjournment of such
meeting. In the absence of a quorum at any such adjourned meeting,
such adjourned meeting may be further adjourned for such period as
may be determined by the chairman of the meeting prior to the
adjournment of such adjourned meeting. Except as provided by
Section 1205(e), notice of the reconvening of any meeting adjourned
for more than thirty (30) days shall be given as provided in
Section 106 not less than ten (10) days prior to the date on which
the meeting is scheduled to be reconvened. Notice of the
reconvening of an adjourned meeting shall state expressly the
percentage, as provided above, of the principal amount of the
Outstanding Securities of such series and Tranches which shall
constitute a quorum.
Except as limited by Section 1102, any resolution
presented to a meeting or adjourned meeting duly reconvened at
which a quorum is present as aforesaid may be adopted only by the
affirmative vote of the Holders of a majority in aggregate
principal amount of the Outstanding Securities of the series and
Tranches with respect to which such meeting shall have been called,
considered as one class; provided, however, that, except as so lim-
ited, any resolution with respect to any action which this
Indenture expressly provides may be taken by the Holders of a
specified percentage, which is less than a majority, in principal
amount of the Outstanding Securities of such series and Tranches,
considered as one class, may be adopted at a meeting or an
adjourned meeting duly reconvened and at which a quorum is present
as aforesaid by the affirmative vote of the Holders of such
specified percentage in principal amount of the Outstanding
Securities of such series and Tranches, considered as one class.
Any resolution passed or decision taken at any
meeting of Holders of Securities duly held in accordance with this
Section shall be binding on all the Holders of Securities of the
series and Tranches with respect to which such meeting shall have
been held, whether or not present or represented at the meeting.
SECTION 1205. ATTENDANCE AT MEETINGS; DETERMINATION OF VOTING
RIGHTS; CONDUCT AND ADJOURNMENT OF MEETINGS.
(a) Attendance at meetings of Holders of
Securities may be in person or by proxy; and, to the extent
permitted by law, any such proxy shall remain in effect and be
binding upon any future Holder of the Securities with respect to
which it was given unless and until specifically revoked by the
Holder or future Holder (except as provided in Section 104(g)) of
such Securities before being voted.
(b) Notwithstanding any other provisions of
this Indenture, the Trustee may make such reasonable regulations as
it may deem advisable for any meeting of Holders of Securities in
regard to proof of the holding of such Securities and of the
appointment of proxies and in regard to the appointment and duties
of inspectors of votes, the submission and examination of proxies,
certificates and other evidence of the right to vote, and such
other matters concerning the conduct of the meeting as it shall
deem appropriate. Except as otherwise permitted or required by any
such regulations and approved by the Company, the holding of
Securities shall be proved in the manner specified in Section 104
and the appointment of any proxy shall be proved in the manner
specified in Section 104. Such regulations may provide that
written instruments appointing proxies, regular on their face, may
be presumed valid and genuine without the proof specified in
Section 104 or other proof.
(c) The Trustee shall, by an instrument in
writing, appoint a temporary chairman of the meeting, unless the
meeting shall have been called by the Company or by Holders as pro-
vided in Section 1202(b), in which case the Company or the Holders
of Securities of the series and Tranches calling the meeting, as
the case may be, shall in like manner appoint a temporary chairman.
A permanent chairman and a permanent secretary of the meeting shall
be elected by vote of the Persons entitled to vote a majority in
aggregate principal amount of the Outstanding Securities of all
series and Tranches represented at the meeting, considered as one
class.
(d) At any meeting each Holder or proxy
shall be entitled to one vote for each One Thousand Dollars
($1,000) principal amount of Outstanding Securities held or
represented by such Holder; provided, however, that no vote shall
be cast or counted at any meeting in respect of any Security
challenged as not Outstanding and ruled by the chairman of the
meeting to be not Outstanding. The chairman of the meeting shall
have no right to vote, except as a Holder of a Security or proxy.
(e) Any meeting duly called pursuant to
Section 1202 at which a quorum is present may be adjourned from
time to time by Persons entitled to vote a majority in aggregate
principal amount of the Outstanding Securities of all series and
Tranches represented at the meeting, considered as one class; and
the meeting may be held as so adjourned without further notice.
SECTION 1206. COUNTING VOTES AND RECORDING ACTION OF MEETINGS.
The vote upon any resolution submitted to any meeting
of Holders shall be by written ballots on which shall be subscribed
the signatures of the Holders or of their representatives by proxy
and the principal amounts and serial numbers of the Outstanding
Securities, of the series and Tranches with respect to which the
meeting shall have been called, held or represented by them. The
permanent chairman of the meeting shall appoint two inspectors of
votes who shall count all votes cast at the meeting for or against
any resolution and who shall make and file with the secretary of
the meeting their verified written reports of all votes cast at the
meeting. A record in duplicate of the proceedings of each meeting
of Holders shall be prepared by the secretary of the meeting and
there shall be attached to such record the original reports of the
inspectors of votes on any vote by ballot taken thereat and
affidavits by one or more persons having knowledge of the facts
setting forth a copy of the notice of the meeting and showing that
such notice was given as provided in Section 1202 and, if
applicable, Section 1204. Each copy shall be signed and verified
by the affidavits of the permanent chairman and secretary of the
meeting and one such copy shall be delivered to the Company, and
another to the Trustee to be preserved by the Trustee, the latter
to have attached thereto the ballots voted at the meeting. Any
record so signed and verified shall be conclusive evidence of the
matters therein stated.
SECTION 1207. ACTION WITHOUT MEETING.
In lieu of a vote of Holders at a meeting as
hereinbefore contemplated in this Article, any request, demand,
authorization, direction, notice, consent, waiver or other action
may be made, given or taken by Holders by written instruments as
provided in Section 104.
ARTICLE THIRTEEN
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS
AND DIRECTORS
SECTION 1301. LIABILITY SOLELY CORPORATE.
No recourse shall be had for the payment of the
principal of or premium, if any, or interest, if any, on any
Securities, or any part thereof, or for any claim based thereon or
otherwise in respect thereof, or of the indebtedness represented
thereby, or upon any obligation, covenant or agreement under this
Indenture, against any incorporator, stockholder, officer or
director, as such, past, present or future, of the Company or of
any predecessor or successor corporation (either directly or
through the Company or a predecessor or successor corporation),
whether by virtue of any constitutional provision, statute or rule
of law or by the enforcement of any assessment or penalty or
otherwise; it being expressly agreed and understood that this
Indenture and all the Securities are solely corporate obligations
and that no personal liability whatsoever shall attach to, or be
incurred by, any incorporator, stockholder, officer or director,
past, present or future, of the Company or of any predecessor or
successor corporation, either directly or indirectly through the
Company or any predecessor or successor corporation, because of the
indebtedness hereby authorized or under or by reason of any of the
obligations, covenants or agreements contained in this Indenture or
in any of the Securities or to be implied herefrom or therefrom;
and such personal liability, if any, is hereby expressly waived and
released as a condition of, and as part of the consideration for,
the execution and delivery of this Indenture and the issuance of
the Securities.
IN WITNESS WHEREOF, the parties hereto have caused
this Indenture to be duly executed as of the day and year first
above written.
THE WASHINGTON WATER POWER COMPANY
By:
------------------------------------
Name: J.E. Eliassen
Title: Senior Vice President and
Chief Financial Officer
THE CHASE MANHATTAN BANK, Trustee
By:
------------------------------------
Name:
Title:
=====================================================================
THE WASHINGTON WATER POWER COMPANY
----------------------------
OFFICER'S CERTIFICATE
(Under Section 301 of the Indenture,
dated as of , 1998)
-------- --
Establishing Series of Securities Designated
---------------------------
-------------------------------
,
---------- -- ----
====================================================================
THE WASHINGTON WATER POWER COMPANY
OFFICER'S CERTIFICATE
(Under Section 301 of the Indenture,
dated as of , 1998)
------- --
I, , a of THE
------------------ -----------------------
WASHINGTON WATER POWER COMPANY (the "Company"), in accordance
with Section 301 of the Indenture, dated as of , 1998
--------- --
(the "Indenture", capitalized terms used herein and not defined
herein having the meanings specified in the Indenture), of the
Company to The Chase Manhattan Bank, trustee (the "Trustee"), do
hereby establish a series of Securities having the terms and
characteristics set forth in this Officer's Certificate.
PART I
Set forth below in this Part I are the terms and
characteristics of the series of Securities established hereby
referred to in clauses (a) through (t) in the second paragraph of
Section 301 of the Indenture (the lettered clauses set forth
herein corresponding to such clauses in said Section 301).
(a) the title of the Securities of such series, being
Series No. under the Indenture, shall be " "
- ------------------
(the Securities of such series, for purposes of this Officer's
Certificate, being sometimes hereinafter called the
"Securities");
(b) the aggregate principal amount of the Securities
which may be authenticated and delivered under the Indenture
shall be limited to $ , except as contemplated in Section
------
301(b) of the Indenture;
(c) interest on the Securities shall be payable to the
Person or Persons in whose names the Securities are registered at
the close of business on the Regular Record Date for such
interest, except as otherwise expressly provided in the form of
[Floating Rate] Security attached hereto and hereby authorized
and approved;
(d) the principal of the Securities shall be payable
on , ;
----- -- ----
(e) [the Securities shall bear interest at a rate of
per centum ( %) per annum;] [the Initial Interest Rate for
---- ---
the Securities shall be per centum ( %) per annum, the Base
--- ---
Rate for the Securities shall be [the CD Rate][the Commercial
Paper Rate][the Constant-Maturity Treasury Rate][the Federal
Funds Rate][LIBOR][the Prime Rate][the Treasury Rate][any other
Base Rate], the Maximum Interest Rate, if any, for the Securities
shall be per centum ( %) per annum, the Minimum Interest
--- ---
Rate, if any, for the Securities shall be per centum ( %)
--- ---
per annum, the Interest Payment Period for the Securities shall
be , the Interest Reset Period for the Securities shall be
-----
, the Interest Reset Dates for the Securities shall be
-----
, the Rate Determination Dates for the Securities shall be
-----
, the Index Maturity for the Securities shall be , the
----- -----
Spread, if any, for the Securities shall be , the Spread
-----
Multiplier, if any, for the Securities shall be (each of
-----
such terms being referred to in the form of Floating Rate
Security attached hereto), [any other terms relating to the
determination of the interest rates on the Securities and the
interest rate, if any, on overdue principal, premium or interest
for the Securities shall be ;
-----
interest shall accrue on any Securities from the Original
Interest Accrual Date specified in such Securities or the most
recent date to which interest has been paid or duly provided for;
the Interest Payment Dates on the Securities shall be
----- --
and , and the Regular Record Date with respect to each
----- --
such Interest Payment Date shall be the date 15 calendar days
immediately preceding such Interest Payment Date (whether or not
a Business Day); and interest on Floating Rate which employ
-----
the Treasury Rate as the Base Rate shall be computed on the basis
of the actual number of days in the year;
(f) the corporate trust office of The Chase Manhattan
Bank in New York, New York shall be the place at which (i) the
principal of, premium, if any, and interest, if any, on the
Securities at Maturity shall be payable upon presentment,
interest prior to Maturity to be paid as specified in the form of
Security attached hereto, (ii) registration of transfer of the
Securities may be effected, (iii) exchanges of Securities may be
effected and (iv) notices and demands to or upon the Company in
respect of the Securities and the Indenture may be served; and
The Chase Manhattan Bank shall be the Security Registrar and a
Paying Agent for the Securities; provided, however, that the
Company reserves the right to change, by one or more Officer's
Certificates supplemental to this Officer's Certificate, any such
place or the Security Registrar or such Paying Agent; and
provided, further, that the Company reserves the right to
designate, by one or more Officer's Certificates supplemental to
this Officer's Certificate, its principal corporate office in
Spokane, Washington as any such place or itself as the Security
Registrar;
(g) [the Securities shall be redeemable in whole or in
part, at the option of the Company, during the period, at the
prices and upon the conditions and terms as set forth below:];
(h) [the Company shall be obligated to [redeem]
[purchase] the Securities [pursuant to [a sinking fund]
[analogous provisions]] [at the option of a Holder thereof],
during the period, at the prices and upon the terms and
conditions as set forth below;]
(i) the Securities shall be issued in denominations of
;
----------
(j) inapplicable;
(k) inapplicable;
(l) inapplicable;
(m) inapplicable;
(n) inapplicable;
(o) inapplicable;
(p) inapplicable;
(q) the Securities are initially to be issued in
global form, registered in the name of Cede & Co., as nominee for
The Depository Trust Company (the "Depositary"). Such Securities
shall not be transferable or exchangeable, nor shall any
purported transfer be registered, except as follows:
(i) such Securities may be transferred in whole, and
appropriate registration of transfer effected, if such
transfer is by such nominee to the Depositary, or by the
Depositary to another nominee thereof, or by any nominee of
the Depositary to any other nominee thereof, or by the
Depositary or any nominee thereof to any successor
securities depositary or any nominee thereof; and
(ii) such Securities may be exchanged for definitive
Securities registered in the respective names of the
beneficial holders thereof, and thereafter shall be
transferable without restriction, if:
(A) The Depositary, or any successor securities
depositary, shall have notified the Company and the
Trustee that it is unwilling or unable to continue to
act as securities depositary with respect to such
Securities and the Trustee shall not have been notified
by the Company within ninety (90) days of the identity
of a successor securities depositary with respect to
such Securities;
(B) the Company shall have delivered to the Trustee a
Company Order to the effect that such Securities shall
be so exchangeable on and after a date specified
therein; or
(C) (I) an Event of Default shall have occurred and be
continuing, (II) the Trustee shall have given notice of
such Event of Default pursuant to Section 802 of the
Indenture and (III) there shall have been delivered to
the Company and the Trustee an Opinion of Counsel to
the effect that the interests of the beneficial owners
of such Securities in respect thereof will be
materially impaired unless such owners become Holders
of definitive Securities;
it being understood that any such registration of transfer or
exchange shall be effected in accordance with Section 305 of the
Indenture.
(r) inapplicable;
(s) no service charge shall be made for the
registration of transfer or exchange of the Securities; provided,
however, that the Company may require payment of a sum sufficient
to cover any tax or other governmental charge payable in
connection with such transfer or exchange; and
(t) [Section 113 of the Indenture shall apply to the
Securities][the provisions of the Floating Rate Securities shall
apply in lieu of the provisions of Section 113].
PART II
Set forth below in this Part II are additional terms of
the series of Securities established hereby, as contemplated by
clause (u) in the second paragraph of Section 301 of the
Indenture.
(a) the Securities shall have such further terms as
are set forth in the form of [Floating Rate] Security
attached hereto as Exhibit A;
(b) if the Company shall make any deposit of money
and/or Government Obligations with respect to any
Securities, or any portion of the principal amount thereof,
as contemplated by Section 601 of the Indenture, the Company
shall not deliver an Officer's Certificate described in
clause (z) in the first paragraph of said Section 601 unless
the Company shall also deliver to the Trustee, together with
such Officer's Certificate, either:
(i) an instrument wherein the Company,
notwithstanding the satisfaction and discharge of its
indebtedness in respect of the Securities, shall assume
the obligation (which shall be absolute and
unconditional) to irrevocably deposit with the Trustee
or Paying Agent such additional sums of money, if any,
or additional Government Obligations (meeting the
requirements of Section 601), if any, or any
combination thereof, at such time or times, as shall be
necessary, together with the money and/or Government
Obligations theretofore so deposited, to pay when due
the principal of and premium, if any, and interest due
and to become due on such Securities or portions
thereof, all in accordance with and subject to the
provisions of said Section 601; provided, however, that
such instrument may state that the obligation of the
Company to make additional deposits as aforesaid shall
be subject to the delivery to the Company by the
Trustee of a notice asserting the deficiency
accompanied by an opinion of an independent public
accountant of nationally recognized standing showing
the calculation thereof (which shall be obtained at the
expense of the Company); or
(ii) an Opinion of Counsel to the effect that the
Holders of such Securities, or portions of the
principal amount thereof, will not recognize income,
gain or loss for United States federal income tax
purposes as a result of the satisfaction and discharge
of the Company's indebtedness in respect thereof and
will be subject to United States federal income tax on
the same amounts, at the same times and in the same
manner as if such satisfaction and discharge had not
been effected[; and
(c)(i) So long as any of the Securities shall remain
Outstanding, the Company shall not create, issue, incur or assume
any Secured Debt other than Permitted Secured Debt without the
consent of the Holders of a majority in principal amount of the
Outstanding Securities of all series (including the Securities)
and Tranches with respect to which this covenant is specified as
contemplated by Section 301, considered as one class (all such
Securities being hereinafter called the "Benefitted Securities").
(ii) The provisions of clause (c)(i) above shall not
prohibit the creation, issuance, incurrence or assumption of any
Secured Debt if either
(A) the Company shall make effective provision whereby
all Benefitted Securities then Outstanding shall be secured
equally and ratably with such Secured Debt; or
(B) the Company shall deliver to the Trustee bonds,
notes or other evidences of indebtedness secured by the Lien
which secures such Secured Debt (hereinafter called "Secured
Obligations") (I) in an aggregate principal amount equal to
the aggregate principal amount of the Benefitted Securities
then Outstanding, (II) maturing (or being subject to
mandatory redemption) on such dates and in such principal
amounts that, at each Stated Maturity of the Outstanding
Benefitted Securities, there shall mature (or be redeemed)
Secured Obligations equal in principal amount to the
Securities then to mature and (III) containing, in addition
to any mandatory redemption provisions applicable to all
Secured Obligations outstanding under such Lien and any
mandatory redemption provisions contained therein pursuant
to clause (II) above, mandatory redemption provisions
correlative to the provisions, if any, for the mandatory
redemption (pursuant to a sinking fund or otherwise) of the
Benefitted Securities or for the redemption thereof at the
option of the Holder, as well as a provision for mandatory
redemption upon an acceleration of the maturity of all
Outstanding Benefitted Securities following an Event of
Default (such mandatory redemption to be rescinded upon the
rescission of such acceleration); it being expressly
understood that such Secured Obligations (X) may, but need
not, bear interest, (Y) may, but need not, contain
provisions for the redemption thereof at the option of the
issuer, any such redemption to be made at a redemption price
or prices not less than the principal amount thereof and (Z)
shall be held by the Trustee for the benefit of the Holders
of all Benefitted Securities from time to time Outstanding
subject to such terms and conditions relating to surrender
to the Company, transfer restrictions, voting, application
of payments of principal and interest and other matters as
shall be set forth in an indenture supplemental hereto
specifically providing for the delivery to the Trustee of
such Secured Obligations.
(iii) If the Company shall elect either of the
alternatives described in clause (c)(ii) above, the Company shall
deliver to the Trustee:
(A) an indenture supplemental to the Indenture (I)
together with appropriate inter-creditor arrangements,
whereby all Securities then Outstanding shall be secured by
the Lien referred to in clause (c)(ii) above equally and
ratably with all other indebtedness secured by such Lien or
(II) providing for the delivery to the Trustee of Secured
Obligations;
(B) an Officer's Certificate (I) stating that, to the
knowledge of the signer, (1) no Event of Default has
occurred and is continuing and (2) no event has occurred and
is continuing which entitles the secured party under such
Lien to accelerate the maturity of the indebtedness
outstanding thereunder and (II) stating the aggregate
principal amount of indebtedness issuable, and then proposed
to be issued, under and secured by such Lien;
(C) an Opinion of Counsel (I) if the Benefitted
Securities then Outstanding are to be secured by such Lien,
to the effect that all such Securities then Outstanding are
entitled to the benefit of such Lien equally and ratably
with all other indebtedness outstanding under such Lien or
(II) if Secured Obligations are to be delivered to the
Trustee, to the effect that such Secured Obligations have
been duly issued under such Lien and constitute valid
obligations, entitled to the benefit of such Lien equally
and ratably with all other indebtedness then outstanding
under such Lien.
(c) For all purposes of this clause (c), except as
otherwise expressly provided or unless the context otherwise
requires:
"DEBT", with respect to any Person, means (A)
indebtedness of such Person for borrowed money evidenced by
a bond, debenture, note or other written instrument or
agreement by which such Person is obligated to repay such
borrowed money and (B) any guaranty by such Person of any
such indebtedness of another Person. "Debt" does not
include, among other things, (X) indebtedness of such Person
under any installment sale or conditional sale agreement or
any other agreement relating to indebtedness for the
deferred purchase price of property or services, (Y)
obligations of such Person under any lease agreement
(including any lease intended as security), whether or not
such obligations are required to be capitalized on the
balance sheet of such Person under generally accepted
accounting principles, or (Z) liabilities secured by any
Lien on any property owned by such Person if and to the
extent that such Person has not assumed or otherwise become
liable for the payment thereof.
"EXCEPTED PROPERTY" means
(A) all cash on hand or in banks or other financial
institutions, deposit accounts, shares of stock, interests
in general or limited partnerships, bonds, notes, other
evidences of indebtedness and other securities, of
whatsoever kind and nature, not hereafter paid or delivered
to, deposited with or held by the Trustee hereunder or
required so to be;
(B) all contracts, leases, operating agreements and
other agreements of whatsoever kind and nature; all contract
rights, bills, notes and other instruments and chattel paper
(except to the extent that any of the same constitute
securities, in which case they are separately excepted from
the operation of this clause (w) under clause (A) above);
all revenues, income and earnings, all accounts, accounts
receivable and unbilled revenues, and all rents, tolls,
issues, products and profits, claims, credits, demands and
judgments; all governmental and other licenses, permits,
franchises, consents and allowances; and all patents, patent
licenses and other patent rights, patent applications, trade
names, trademarks, copyrights, claims, credits, choses in
action and other intangible property and general intangibles
including, but not limited to, computer software;
(C) all automobiles, buses, trucks, truck cranes,
tractors, trailers and similar vehicles and movable
equipment; all rolling stock, rail cars and other railroad
equipment; all vessels, boats, barges and other marine
equipment; all airplanes, helicopters, aircraft engines and
other flight equipment; all parts, accessories and supplies
used in connection with any of the foregoing; and all
personal property of such character that the perfection of a
security interest therein or other Lien thereon is not
governed by the Uniform Commercial Code as in effect in the
jurisdiction in which such property is located;
(D) all goods, stock in trade, wares, merchandise and
inventory held for the purpose of sale or lease in the
ordinary course of business; all materials, supplies,
inventory and other items of personal property which are
consumable (otherwise than by ordinary wear and tear) in
their use in the operation of any property of the Company;
all fuel, including nuclear fuel, whether or not any such
fuel is in a form consumable in the operation of any
property of the Company, including separate components of
any fuel in the forms in which such components exist at any
time before, during or after the period of the use thereof
as fuel; all hand and other portable tools and equipment;
all furniture and furnishings; and computers and data
processing, data storage, data transmission,
telecommunications and other facilities, equipment and
apparatus, which, in any case, are used primarily for
administrative or clerical purposes or are otherwise not
necessary for the operation or maintenance of the
facilities, machinery, equipment or fixtures of the Company
for (I) the generation, transmission or distribution of
electric energy, (II) the transmission, storage or
distribution of gas or (III) the appropriation, storage,
transmission or distribution of water;
(E) all coal, ore, gas, oil and other minerals and all
timber, and all rights and interests in any of the
foregoing, whether or not such minerals or timber shall have
been mined or extracted or otherwise separated from the
land; and all electric energy, gas (natural or artificial),
steam, water and other products generated, produced,
manufactured, purchased or otherwise acquired by the
Company;
(F) all real property, leaseholds, gas rights, wells,
gathering, tap or other pipe lines, or facilities, equipment
or apparatus, in any case used or to be used primarily for
the production or gathering of natural gas; and
(G) all property which is the subject of a lease
agreement designating the Company as lessee and all right,
title and interest of the Company in and to such property
and in, to and under such lease agreement, whether or not
such lease agreement is intended as security.
"LIEN" means any mortgage, deed of trust, pledge,
security interest, conditional sale or other title retention
agreement or any lease in the nature thereof.
"PERMITTED SECURED DEBT" means, as of any particular
time, any of the following:
(A) Secured Debt which matures less than one year from
the date of the issuance or incurrence thereof and is not
extendible at the option of the issuer; and any refundings,
refinancings and/or replacements of any such Secured Debt by
or with similar Secured Debt;
(B) Secured Debt secured by Purchase Money Liens or
any other Liens existing or placed upon property at the time
of, or within one hundred eighty (180) days after, the
acquisition thereof by the Company, and any refundings,
refinancings and/or replacements of any such Secured Debt;
provided, however, that no such Purchase Money Lien or other
Lien shall extend to or cover any property of the Company
other than (I) the property so acquired and improvements,
extensions and additions to such property and renewals,
replacements and substitutions of or for such property or
any part or parts thereof and (II) with respect to Purchase
Money Liens, other property subsequently acquired by the
Company;
(C) Secured Debt relating to governmental obligations
the interest on which is not included in gross income for
purposes of federal income taxation pursuant to Section 103
of the Internal Revenue Code of 1986, as amended (or any
successor provision of law), for the purpose of financing or
refinancing, in whole or in part, costs of acquisition or
construction of property to be used by the Company, to the
extent that the Lien which secures such Secured Debt is
required either by applicable law or by the issuer of such
governmental obligations or is otherwise necessary in order
to establish or maintain such exclusion from gross income;
and any refundings, refinancings and/or replacements of any
such Secured Debt by or with similar Secured Debt;
(D) Secured Debt (I) which is related to the
construction or acquisition of property not previously owned
by the Company or (II) which is related to the financing of
a project involving the development or expansion of property
of the Company and (III) in either case, the obligee in
respect of which has no recourse to the Company or any
property of the Company other than the property constructed
or acquired with the proceeds of such transaction or the
project financed with the proceeds of such transaction (or
the proceeds of such property or such project); and any
refundings, refinancings and/or replacements of any such
Secured Debt by or with Secured Debt described in clause
(III) above;
(E) Secured Debt permitted under clause (c)(ii) above;
and
(F) in addition to the Permitted Secured Debt
described in clauses (A) through (E) above, Secured Debt not
otherwise permitted in this clause (c) in an aggregate
principal amount not exceeding 10% of the total assets of
the Company and its consolidated subsidiaries, as shown on
the latest balance sheet of the Company and its consolidated
subsidiaries, audited by independent certified public
accountants, dated prior to the date of the creation,
issuance, incurrence or assumption of such Secured Debt.
"PURCHASE MONEY LIEN" means, with respect to any
property being acquired by the Company, a Lien on such
property which
(A) is taken or retained by the transferor of such
property to secure all or part of the purchase price
thereof;
(B) is granted to one or more Persons other than the
transferor which, by making advances or incurring an
obligation, give value to enable the grantor of such Lien to
acquire rights in or the use of such property;
(C) is held by a trustee or agent for the benefit of
one or more Persons described in clause (A) or (B) above,
provided that such Lien may be held, in addition, for the
benefit of one or more other Persons which shall have
theretofore given, or may thereafter give, value to or for
the benefit or account of the grantor of such Lien for one
or more other purposes; or
(D) otherwise constitutes a purchase money mortgage or
a purchase money security interest under applicable law;
and, without limiting the generality of the foregoing, for
purposes of this Indenture, the term Purchase Money Lien
shall be deemed to include any Lien described above whether
or not such Lien (X) shall permit the issuance or other
incurrence of additional indebtedness secured by such Lien
on such property, (Y) shall permit the subjection to such
Lien of additional property and the issuance or other
incurrence of additional indebtedness on the basis thereof
and/or (Z) shall have been granted prior to the acquisition
of such property, shall attach to or otherwise cover
property other than the property being acquired and/or shall
secure obligations issued prior and/or subsequent to the
issuance of the obligations delivered in connection with
such acquisition.
"SECURED DEBT", with respect to any Person, means Debt
created, issued, incurred or assumed by such Person which is
secured by a Lien upon any property (other than Excepted
Property) of the Company, real, personal or mixed, of
whatever kind or nature and wherever located, whether owned
at the date of the initial authentication and delivery of
the Securities, or thereafter acquired].
------------
IN WITNESS WHEREOF, I have executed this Officer's
Certificate this day of , .
--- ---- ----
------------------------------
Name:
Title:
FORM OF FIXED RATE DEBT SECURITY
(See legend at the end of this Security for
restrictions on transfer and change of form)
THE WASHINGTON WATER POWER COMPANY
, Series
------------------ --
Original Interest Accrual Date: Redeemable: Yes No
-- --
Stated Maturity: Initial Redemption Date:
Interest Rate: Initial Redemption Price:
Interest Payment Dates: Reduction Percentage:
Regular Record Dates: Redemption Limitation Date:
Other Provisions:
OID: Yes No
-- --
Total Amount of OID (%):
Yield to Maturity (%):
Initial Accrual
Period OID (%):
(Constant - Yield Method)
This Security is not a Discount Security
within the meaning of the within-mentioned Indenture.
------------------------------
Principal Amount Registered No.
$ CUSIP
THE WASHINGTON WATER POWER COMPANY, a corporation organized
and existing under the laws of the State of Washington (herein
called the "Company," which term includes any successor
corporation under the Indenture referred to below), for value
received, hereby promises to pay to
or registered assigns, the principal sum of
DOLLARS
on the Stated Maturity specified above, and to pay interest
thereon from the Original Interest Accrual Date specified above
or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, semi-annually in arrears on
the Interest Payment Dates specified above in each year,
commencing with the Interest Payment Date next succeeding the
Original Interest Accrual Date specified above, and at Maturity,
at the Interest Rate per annum specified above, until the
principal hereof is paid or duly provided for. The interest so
payable, and paid or duly provided for, on any Interest Payment
Date shall, as provided in such Indenture, be paid to the Person
in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular
Record Date specified above (whether or not a Business Day) next
preceding such Interest Payment Date. Notwithstanding the
foregoing, interest payable at Maturity shall be paid to the
Person to whom principal shall be paid. Except as otherwise
provided in said Indenture, any such interest not so paid or duly
provided for shall forthwith cease to be payable to the Holder on
such Regular Record Date and may either be paid to the Person in
whose name this Security (or one or more Predecessor Securities)
is registered at the close of business on a Special Record Date
for the payment of such Unpaid Interest to be fixed by the
Trustee, notice of which shall be given to Holders of Securities
of this series not less than 15 days prior to such Special Record
Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on
which the Securities of this series may be listed, and upon such
notice as may be required by such exchange, all as more fully
provided in said Indenture.
Payment of the principal of and premium, if any, on this
Security and interest hereon at Maturity shall be made upon
presentation of this Security at the Corporate Trust Office of
The Chase Manhattan Bank in New York, New York, or at such other
office or agency as may be designated for such purpose by the
Company from time to time. Payment of interest on this Security
(other than interest at Maturity) shall be made by check mailed
to the address of the Person entitled thereto as such address
shall appear in the Security Register, except that (a) if such
Person shall be a securities depositary, such payment may be made
by such other means in lieu of check, as shall be agreed upon by
the Company, the Trustee and such Person and (b) upon the written
request of a Holder of not less that $10 million in aggregate
principal amount of Securities (as hereinafter defined) of the
same series delivered to the Company and the Paying Agent at
least ten days prior to any Interest Payment Date, payment of
interest on such Securities to such Holder on such Interest
Payment Date shall be made by wire transfer of immediately
available funds to an account maintained within the continental
United States specified by such Holder or, if such Holder
maintains an account with the entity acting as Paying Agent, by
deposit into such account. Payment of the principal of and
premium, if any, and interest on this Security, as aforesaid,
shall be made in such coin or currency of the United States of
America as at the time of payment shall be legal tender for the
payment of public and private debts.
This Security is one of a duly authorized issue of
securities of the Company (herein called the "Securities"),
issued and issuable in one or more series under and equally
secured by an Indenture, dated as of , 1998 (such
----------- --
Indenture as originally executed and delivered and as
supplemented or amended from time to time thereafter, together
with any constituent instruments establishing the terms of
particular Securities, being herein called the "Indenture"),
between the Company and The Chase Manhattan Bank, trustee (herein
called the "Trustee," which term includes any successor trustee
under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a description
of the respective rights, limitations of rights, duties and
immunities of the Company, the Trustee and the Holders of the
Securities thereunder and of the terms and conditions upon which
the Securities are, and are to be, authenticated and delivered
and secured. The acceptance of this Security shall be deemed to
constitute the consent and agreement by the Holder hereof to all
of the terms and provisions of the Indenture. This Security is
one of the series designated above.
If any Interest Payment Date, any Redemption Date or the
Stated Maturity shall not be a Business Day (as hereinafter
defined), payment of the amounts due on this Security on such
date may be made on the next succeeding Business Day; and, if
such payment is made or duly provided for on such Business Day,
no interest shall accrue on such amounts for the period from and
after such Interest Payment Date, Redemption Date or Stated
Maturity, as the case may be, to such Business Day.
If, as specified above, this Security is redeemable, this
Security is subject to redemption at any time on or after the
Initial Redemption Date specified above, as a whole or in part,
at the election of the Company, at the applicable redemption
price (as described below) plus accrued interest to the date
fixed for redemption. Such redemption price shall be the Initial
Redemption Price specified above for the twelve-month period
commencing on the Initial Redemption Date and shall decline for
the twelve-month period commencing on each anniversary of the
Initial Redemption Date by a percentage of principal amount equal
to the Reduction Percentage specified above until such redemption
price is 100% of the principal amount of this Security to be
redeemed.
Notwithstanding the foregoing, the Company may not, prior to
the Redemption Limitation Date, if any, specified above, redeem
this Security as contemplated above as a part of, or in
anticipation of, any refunding operation by the application,
directly or indirectly, of moneys borrowed having an effective
interest cost to the Company (calculated in accordance with
generally accepted financial practice) less than the effective
interest cost to the Company (similarly calculated) of this
Security.
[Insert provisions, if any, for redemption pursuant to a
sinking fund or analogous provision or at the option of the
Holder.]
Notice of redemption [(other than at the election of the
Holder)] shall be given by mail to Holders of Securities, not
less than 30 days nor more than 60 days prior to the date fixed
for redemption, all as provided in the Indenture. As provided in
the Indenture, notice of redemption at the election of the
Company as aforesaid may state that such redemption shall be
conditional upon the receipt by the Trustee of money sufficient
to pay the principal of and premium, if any, and interest, if
any, on this Security on or prior to the date fixed for such
redemption; a notice of redemption so conditioned shall be of no
force or effect if such money is not so received and, in such
event, the Company shall not be required to redeem this Security.
In the event of redemption of this Security in part only, a
new Security or Securities of this series, of like tenor, for the
unredeemed portion hereof will be issued in the name of the
Holder hereof upon the cancellation hereof.
If an Event of Default shall occur and be continuing, the
principal of this Security may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the Trustee to enter into one or more supplemental
indentures for the purpose of adding any provisions to, or
changing in any manner or eliminating any of the provisions of,
the Indenture with the consent of the Holders of not less than a
majority in aggregate principal amount of the Securities of all
series then Outstanding under the Indenture, considered as one
class; provided, however, that if there shall be Securities of
more than one series Outstanding under the Indenture and if a
proposed supplemental indenture shall directly affect the rights
of the Holders of Securities of one or more, but less than all,
of such series, then the consent only of the Holders of a
majority in aggregate principal amount of the Outstanding
Securities of all series so directly affected, considered as one
class, shall be required; and provided, further, that if the
Securities of any series shall have been issued in more than one
Tranche and if the proposed supplemental indenture shall directly
affect the rights of the Holders of Securities of one or more,
but less than all, of such Tranches, then the consent only of the
Holders of a majority in aggregate principal amount of the
Outstanding Securities of all Tranches so directly affected,
considered as one class, shall be required; and provided,
further, that the Indenture permits the Trustee to enter into one
or more supplemental indentures for limited purposes without the
consent of any Holders of Securities. The Indenture also
contains provisions permitting the Holders of a majority in
principal amount of the Securities then Outstanding, on behalf of
the Holders of all Securities, to waive compliance by the Company
with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be
conclusive and binding upon such Holder and upon all future
Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange therefor or in
lieu hereof, whether or not notation of such consent or waiver is
made upon this Security.
As provided in the Indenture and subject to certain
limitations therein set forth, this Security or any portion of
the principal amount hereof will be deemed to have been paid for
all purposes of the Indenture and to be no longer Outstanding
thereunder, and, at the election of the Company, the Company's
entire indebtedness in respect thereof will be satisfied and
discharged, if there has been irrevocably deposited with the
Trustee or any Paying Agent (other than the Company), in trust,
money in an amount which will be sufficient and/or Eligible
Obligations, the principal of and interest on which when due,
without regard to any reinvestment thereof, will provide moneys
which, together with moneys so deposited, will be sufficient to
pay when due the principal of and interest on this Security when
due.
The Indenture contains terms, provisions and conditions
relating to the consolidation or merger of the Company with or
into, and the conveyance or other transfer, or lease, of assets
to, another Person, to the assumption by such other Person, in
certain circumstances, of all of the obligations of the Company
under the Indenture and on the Securities and to the release and
discharge of the Company, in certain circumstances, from such
obligation.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is
registrable in the Security Register, upon surrender of this
Security for registration of transfer at the corporate trust
office of The Chase Manhattan Bank in New York, New York or such
other office or agency as may be designated by the Company from
time to time, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and
the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more
new Securities of this series of authorized denominations and of
like tenor and aggregate principal amount, will be issued to the
designated transferee or transferees.
The Securities of this series are issuable only as
registered Securities, without coupons, and in denominations of
. As provided in the Indenture and subject to
-------------
certain limitations therein set forth, Securities of this series
are exchangeable for a like aggregate principal amount of
Securities of the same series and Tranche, of any authorized
denominations, as requested by the Holder surrendering the same,
and of like tenor upon surrender of the Security or Securities to
be exchanged at the corporate trust office of The Chase Manhattan
Bank in New York, New York or such other office or agency as may
be designated by the Company from time to time.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Prior to due surrender of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name this Security
is registered as the absolute owner hereof for all purposes
(subject to Section 307 of the Indenture), whether or not this
Security be overdue, and neither the Company, the Trustee nor any
such agent shall be affected by notice to the contrary.
The Indenture and the Securities shall be governed by and
construed in accordance with the laws of the State of New York,
except to the extent that the Trust Indenture Act shall be
applicable.
As used herein, "Business Day" means any day, other than a
Saturday or Sunday, which is not a day on which banking
institutions or trust companies in The City of New York, New York
or other city in which is located any office or agency maintained
for the payment of principal, premium, if any, or interest on
this Security, are authorized or required by law, regulation or
executive order to remain closed. All other terms used in this
Security which are defined in the Indenture shall have the
meanings assigned to them in the Indenture.
As provided in the Indenture, no recourse shall be had for
the payment of the principal of or premium, if any, or interest
on any Securities, or any part thereof, or for any claim based
thereon or otherwise in respect thereof, or of the indebtedness
represented thereby, or upon any obligation, covenant or
agreement under the Indenture, against, and no personal liability
whatsoever shall attach to, or be incurred by, any incorporator,
shareholder, officer or director, as such, past, present or
future of the Company or of any predecessor or successor
corporation (either directly or through the Company or a
predecessor or successor corporation), whether by virtue of any
constitutional provision, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise; it being
expressly agreed and understood that the Indenture and all the
Securities are solely corporate obligations and that any such
personal liability is hereby expressly waived and released as a
condition of, and as part of the consideration for, the execution
of the Indenture and the issuance of the Securities.
Unless the certificate of authentication hereon has been
executed by the Trustee or an Authenticating Agent by manual
signature, this Security shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument
to be duly executed.
THE WASHINGTON WATER POWER COMPANY
By:
--------------------------------
[Title]
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated
therein referred to in the within-mentioned Indenture.
Dated:
---------------------
OR
--------------------- ---------------------
, ,
------------------- -------------------
AS TRUSTEE AS TRUSTEE
By: BY:[ ],
-----------------------------
Authorized Officer AS AUTHENTICATING AGENT
By:
------------------------
Authorized Officer
This Security may not be transferred or exchanged, nor may
any purported transfer be registered, except (i) this Security
may be transferred in whole, and appropriate registration of
transfer effected, if such transfer is by Cede & Co., as nominee
for The Depository Trust Company (the "Depositary"), to the
Depositary, or by the Depositary to another nominee thereof, or
by any nominee of the Depositary to any other nominee thereof, or
by the Depositary or any nominee thereof to any successor
securities depositary or any nominee thereof; and (ii) this
Security may be exchanged for definitive Securities registered in
the respective names of the beneficial holders hereof, and
thereafter shall be transferable without restrictions if: (A) the
Depositary, or any successor securities depositary, shall have
notified the Company and the Trustee that it is unwilling or
unable to continue to act as securities depositary with respect
to the Securities and the Trustee shall not have been notified by
the Company within ninety (90) days of the identity of a
successor securities depositary with respect to the Securities;
(B) the Company shall have delivered to the Trustee a Company
Order to the effect that the Securities shall be so exchangeable
on and after a date specified therein; or (C)(1) an Event of
Default shall have occurred and be continuing, (2) the Trustee
shall have given notice of such Event of Default pursuant to
Section 802 of the Indenture and (3) there shall have been
delivered to the Company and the Trustee an Opinion of Counsel to
the effect that the interests of the beneficial owners of the
Securities in respect thereof will be materially impaired unless
such owners become Holders of definitive Securities.
--------------------
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto
-----------------------------------------------------------------
[please insert social security or other identifying number
of assignee]
-----------------------------------------------------------------
[please print or typewrite name and address of assignee]
-----------------------------------------------------------------
the within Security of THE WASHINGTON WATER POWER COMPANY and
does hereby irrevocably constitute and appoint
------------------
, Attorney, to transfer said
------------------------------
Security on the books of the within-mentioned Company, with full
power of substitution in the premises.
Dated:
--------------------
----------------------------------------
Notice: The signature to this assignment must correspond with
the name as written upon the face of the Security in every
particular without alteration or enlargement or any change
whatsoever.
FORM OF FLOATING RATE DEBT SECURITY
(See legend at the end of this Security for
restrictions on transfer and change of form)
THE WASHINGTON WATER POWER COMPANY
, Series
----------------- -
ORIGINAL INTEREST ACCRUAL DATE: MAXIMUM INTEREST RATE:
STATED MATURITY: MINIMUM INTEREST RATE:
INITIAL INTEREST RATE: INTEREST PAYMENT PERIOD:
BASE RATE: INTEREST PAYMENT DATES:
[-- CD RATE] REGULAR RECORD DATES:
[-- CMT RATE INTEREST RESET PERIOD:
DESIGNATED CMT MATURITY INDEX: INTEREST RESET DATES:
DESIGNATED CMT TELERATE PAGE:] RATE DETERMINATION DATES:
[-- COMMERCIAL PAPER RATE] INDEX MATURITY:
[-- FEDERAL FUNDS RATE] SPREAD: (+ BASIS PTS.)
-
[-- LIBOR
REPORTING SERVICE: REDEEMABLE: YES NO
-- --
[-- LIBOR REUTERS] INITIAL REDEMPTION DATE:
[-- LIBOR TELERATE] INITIAL REDEMPTION PRICE:
INDEX CURRENCY:] REDUCTION PERCENTAGE:
[-- PRIME RATE] REDEMPTION LIMITATION DATE:
[-- TREASURY RATE] OTHER PROVISIONS:
OID: Yes No
-- --
Total Amount of OID (%):
Yield to Maturity (%):
Initial Accrual
Period OID (%):
(Constant - Yield Method)
------------------------------
This Security is not a Discount Security
within the meaning of the within-mentioned Indenture.
------------------------------
Principal Amount Registered No.
$ CUSIP
THE WASHINGTON WATER POWER COMPANY, a corporation organized
and existing under the laws of the State of Washington (herein
called the "Company," which term includes any successor
corporation under the Indenture referred to below), for value
received, hereby promises to pay to
or registered assigns, the principal sum of
DOLLARS
on the Stated Maturity specified above, and to pay interest
thereon from the Original Interest Accrual Date specified above
or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, quarterly, semi-annually or
annually, as specified above for the Interest Payment Period, in
arrears on the Interest Payment Dates specified above in each
year, commencing with the Interest Payment Date next succeeding
the Original Interest Accrual Date specified above, and at
Maturity, until the principal hereof is paid or duly provided
for. Except as otherwise provided herein, the rate of interest
to be so paid shall be the Initial Interest Rate specified above
until the first Interest Reset Date specified above following the
Original Interest Accrual Date and thereafter a rate determined,
in accordance with the provisions hereinafter set forth, by
reference to the Base Rate specified above plus or minus the
Spread, if any, specified above or multiplied by the Spread
Multiplier, if any, specified above. The interest so payable,
and paid or duly provided for, on any Interest Payment Date
shall, as provided in such Indenture, be paid to the Person in
whose name this Security (or one or more Predecessor Securities)
is registered at the close of business on the Regular Record Date
specified above (whether or not a Business Day) next preceding
such Interest Payment Date. Notwithstanding the foregoing,
interest payable at Maturity shall be paid to the Person to whom
principal shall be paid. Except as otherwise provided in said
Indenture, any such interest not so paid or duly provided for
shall forthwith cease to be payable to the Holder on such Regular
Record Date and may either be paid to the Person in whose name
this Security (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date for
the payment of such Unpaid Interest to be fixed by the Trustee,
notice of which shall be given to Holders of Securities of this
series not less than 15 days prior to such Special Record Date,
or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on
which the Securities of this series may be listed, and upon such
notice as may be required by such exchange, all as more fully
provided in said Indenture.
Payment of the principal of and premium, if any, on this
Security and interest hereon at Maturity shall be made upon
presentation of this Security at the Corporate Trust Office of
The Chase Manhattan Bank in New York, New York or at such other
office or agency as may be designated for such purpose by the
Company from time to time. Payment of interest on this Security
(other than interest at Maturity) shall be made by check mailed
to the address of the Person entitled thereto as such address
shall appear in the Security Register, except that (a) if such
Person shall be a securities depositary, such payment may be made
by such other means in lieu of check, as shall be agreed upon by
the Company, the Trustee and such Person and (b) upon the written
request of a holder of not less than $10 million in aggregate
principal amount of Securities (as hereinafter defined) of the
same series delivered to the Company and the Paying Agent at
least ten days prior to any Interest Payment Date, payment of
interest on such Securities to such Holder on such Interest
Payment Date shall be made by wire transfer of immediately
available funds to an account maintained within the continental
United States specified by such Holder or, if such Holder
maintains an account with the entity acting as Paying Agent, by
deposit into such account. Payment of the principal of and
premium, if any, and interest on this Security, as aforesaid,
shall be made in such coin or currency of the United States of
America as at the time of payment shall be legal tender for the
payment of public and private debts.
This Security is one of a duly authorized issue of
securities of the Company (herein called the "Securities"),
issued and issuable in one or more series under and equally
secured by an Indenture, dated as of , 1998 (such
------------
Indenture as originally executed and delivered and as
supplemented or amended from time to time thereafter, together
with any constituent instruments establishing the terms of
particular Securities, being herein called the "Indenture"),
between the Company and The Chase Manhattan Bank, trustee (herein
called the "Trustee," which term includes any successor trustee
under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a description
of the respective rights, limitations of rights, duties and
immunities of the Company, the Trustee and the Holders of the
Securities thereunder and of the terms and conditions upon which
the Securities are, and are to be, authenticated and delivered
and secured. The acceptance of this Security shall be deemed to
constitute the consent and agreement by the Holder hereof to all
terms and provisions of the Indenture. This Security is one of
the series designated above.
Interest payments on this Security shall be the amount of
interest accrued from and including the last date to which
interest has been paid or duly provided for, or, if no interest
has been paid or duly provided for, from and including the
Original Interest Accrual Date, to but excluding the next
succeeding Interest Payment Date; provided, however, that if the
interest rate on this Security is reset daily or weekly as
specified on the face hereof for the Interest Reset Period,
interest payments shall be the amount of interest accrued from
and including the most recent date to which interest has been
paid or duly provided for, or, if no interest has been paid, from
the Original Interest Accrual Date, to, but excluding, the
Regular Record Date next preceding such Interest Payment Date,
except that at Maturity the interest payable shall include
interest accrued to but excluding the date of Maturity.
Accrued interest on this Security shall be calculated by
multiplying the principal amount of this Security by an accrued
interest factor. Such accrued interest factor shall be computed
by adding the interest factors calculated for each day in the
Interest Payment Period for which accrued interest is being
calculated. The interest factor (expressed as a decimal
calculated to seven decimal places without rounding) for each
such day shall be computed by dividing the interest rate
applicable to such day by 360 if the Base Rate is the CD Rate,
the Commercial Paper Rate, the Federal Funds Rate, LIBOR or the
Prime Rate, as indicated above, or by the actual number of days
in the year if the Base Rate is the CMT Rate or the Treasury
Rate, as indicated above. For purposes of making the foregoing
calculation, the interest rate in effect on any Interest Reset
Date shall be the applicable rate as reset on such date. Unless
otherwise specified above, all percentages resulting from any
calculation of the rate of interest hereon shall be rounded
upwards, if necessary, to the nearest 1/100,000 of 1% (.0000001),
with five one-millionths of a percentage point rounded upward,
and all dollar amounts used in or resulting from such calculation
shall be rounded to the nearest one-hundredth cent (with .005 of
a cent being rounded upward).
Except as otherwise provided herein, commencing with the
first Interest Reset Date specified above following the Original
Interest Accrual Date and thereafter upon each succeeding
Interest Reset Date specified above, the rate at which interest
on this Security is payable shall be reset daily, weekly,
monthly, quarterly, semi-annually or annually as specified above
for the Interest Reset Period, and such rate, as so reset, shall
be effective as of and for the related Interest Reset Date and
for the balance of the related Interest Reset Period to but
excluding the next succeeding Interest Reset Date. Unless
otherwise specified above, the Interest Reset Dates shall be, if
the interest rate on this Security resets daily, each Business
Day; if the interest rate on this Security (unless the Base Rate
is the Treasury Rate) resets weekly, Wednesday of each week; if
the Base Rate specified above is the Treasury Rate and resets
weekly, Tuesday of each week (except as provided below under
"Determination of Treasury Rate"); if the interest rate on this
Security resets monthly, the third Wednesday of each month; if
the interest rate on this Security resets quarterly, the third
Wednesday of March, June, September and December of each year; if
the interest rate on this Security resets semi-annually, the
third Wednesday of the two months of each year specified above;
and if the interest rate on this Security resets annually, the
third Wednesday of the month of each year specified above;
provided, however, that the interest rate in effect for the ten
days immediately prior to Maturity will be that in effect on the
tenth day preceding Maturity. If an Interest Reset Date for this
Security would otherwise be a day that is not a Business Day (as
hereinafter defined), such Interest Reset Date shall be postponed
to the next succeeding Business Day, except that, if the Base
Rate specified on the face hereof is LIBOR and such Business Day
is in the next succeeding calendar month, such Interest Reset
Date shall be the immediately preceding Business Day.
Anything herein to the contrary notwithstanding, the
interest rate hereon shall not be greater than the Maximum
Interest Rate, if any, or less than the Minimum Interest Rate, if
any, specified above. In addition, the interest rate hereon
shall in no event be higher than the maximum rate permitted by
New York law as the same may be modified by United States law of
general application.
Unless otherwise specified above, interest will be payable,
if the interest rate on this Security resets daily, weekly or
monthly, on the third Wednesday of each month or on the third
Wednesday of March, June, September and December of each year, as
specified above; if the interest rate on this Security resets
quarterly, on the third Wednesday of March, June, September and
December of each year; if the interest rate on this Security
resets semi-annually, on the third Wednesday of the two months of
each year specified above; and if the interest rate on this
Security resets annually, on the third Wednesday of the month of
each year specified above (each such day being an "Interest
Payment Date").
If any Interest Payment Date other than a Redemption Date or
the Stated Maturity would otherwise be a day that is not a
Business Day, such Interest Payment Date shall be postponed to
the next succeeding Business Day, except that, if the Base Rate
specified above is LIBOR and such next succeeding Business Day is
in the next succeeding calendar month, such Interest Payment Date
shall be the next preceding Business Day. If a Redemption Date
or the Stated Maturity shall not be a Business Day, payment of
the amounts due on this Security on such date in respect of
principal, premium, if any, and/or interest may be made on the
next succeeding Business Day; and if payment is made or duly
provided for on such Business Day, no interest shall accrue on
such amounts for the period from and after such Redemption Date
or Stated Maturity, as the case may be, to such Business Day.
The Company will appoint, and enter into an agreement with,
an agent (the "Calculation Agent") to calculate the interest
rates on floating rate Securities (including this Security).
Unless otherwise specified above, The Chase Manhattan Bank shall
be the Calculation Agent. All determinations of interest rates
by the Calculation Agent shall, in the absence of manifest error,
be conclusive for all purposes and binding on the Holder hereof.
Subject to applicable provisions of law and except as
otherwise specified herein, on each Interest Reset Date the rate
of interest shall be determined in accordance with the provisions
of the applicable heading below.
[DETERMINATION OF CD RATE.
If the Base Rate specified above is the CD Rate, this
Security shall bear interest for each Interest Reset Period at an
interest rate calculated with reference to the CD Rate,
determined as set forth below, and the Spread or Spread
Multiplier, if any, and subject to the Maximum Interest Rate, if
any, and the Minimum Interest Rate, if any, specified above.
The "CD Rate" for each Interest Reset Period shall be
determined by the Calculation Agent on the Calculation Date (as
hereinafter defined) and shall be (a) the rate (expressed as a
percentage per annum) as of the second Business Day prior to the
related Interest Reset Date (a "CD Rate Determination Date") for
negotiable certificates of deposit having the Index Maturity
specified above as published in H.15(519) under the heading "CDs
(Secondary Market)", or (b) if such rate is not so published by
9:00 A.M., New York City time, on the Calculation Date, the rate
as of such CD Rate Determination Date for negotiable
certificates of deposit of the Index Maturity specified above as
published in Composite Quotations (as hereinafter defined), or
(c) if neither of such rates is published by 3:00 P.M., New York
City time, on the Calculation Date, the arithmetic mean of the
secondary market offered rates as of 10:00 A.M., New York City
time, on such CD Rate Determination Date for certificates of
deposit in an amount that is representative of a single
transaction at that time with a remaining maturity closest to the
Index Maturity specified above of three leading nonbank dealers
in negotiable U.S. dollar certificates of deposit in The City of
New York selected by the Calculation Agent, in its discretion
(after consultation with the Company); provided, however, that if
the dealers selected as aforesaid by the Calculation Agent are
not quoting as described in clause (c) above, the CD Rate for
such Interest Reset Period shall be the same as the CD Rate for
the immediately preceding Interest Reset Period (or, if there was
no such previous Interest Reset Period, the rate of interest
hereon for such Interest Reset Period shall be the Initial
Interest Rate).]
[DETERMINATION OF CMT RATE.
If the Base Rate specified above is the CMT Rate, this
Security shall bear interest for each Interest Reset Period at a
rate calculated with reference to the CMT Rate, determined as set
forth below, and the Spread or Spread Multiplier, if any, and
subject to the Maximum Interest Rate, if any, and the Minimum
Interest Rate, if any, specified above.
The "CMT Rate" for each Interest Reset Period shall be
determined by the Calculation Agent on the Calculation Date and
shall be the rate (expressed as a percentage per annum) displayed
on the Designated CMT Telerate Page (as defined below) under the
caption "...Treasury Constant Maturities... Federal Reserve Board
Release H.15...Mondays Approximately 3:45 p.m." under the column
for the Designated CMT Maturity Index (as defined below) for
(a)(i) if the Designated CMT Telerate Page is 7055, the second
Business Day prior to the related Interest Reset Date (a "CMT
Rate Determination Date") or (ii) if the Designated CMT Telerate
Page is 7052, the week or the month, as applicable, ended
immediately preceding the week in which such CMT Rate
Determination Date occurs, or (b) if such rate is no longer
displayed on the relevant page, or if not displayed by 3:00 p.m.,
New York City time on the Calculation Date, the Treasury Constant
Maturity rate for the Designated CMT Maturity Index as published
in H.15(519), or (c) if such rate is no longer published or, if
not published by 3:00 p.m., New York City time, on the
Calculation Date, the Treasury Constant Maturity rate for the
Designated CMT Maturity Index (or other United States Treasury
rate for the Designated CMT Maturity Index) for such CMT Rate
Determination Date as may then be published by either the Board
of Governors of the Federal Reserve System or the United States
Department of the Treasury that the Calculation Agent determines
to be comparable to the rate formerly displayed on the Designated
CMT Telerate Page and published in H.15(519), or (d) if such
information is not provided by 3:00 p.m., New York City time, on
the Calculation Date, then the CMT Rate for the CMT Rate
Determination Date shall be a yield to maturity, based on the
arithmetic mean of the secondary market closing offer side prices
as of approximately 3:30 p.m., New York City time, on the CMT
Rate Determination Date reported, according to their written
records, by three leading primary United States government
securities dealers (each, a "Reference Dealer") in The City of
New York selected by the Calculation Agent (from five such
Reference Dealers selected by the Calculation Agent, in its
discretion (after consultation with the Company), and eliminating
the highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality,
one of the lowest)), for the most recently issued direct
noncallable fixed rate obligations of the United States
("Treasury notes") with an original maturity of approximately the
Designated CMT Maturity Index and a remaining term to maturity of
not less than such Designated CMT Maturity Index minus one year,
or (e) if the Calculation Agent cannot obtain three such Treasury
notes quotations, a yield to maturity based on the arithmetic
mean of the secondary market offer side prices as of
approximately 3:30 p.m., New York City time, on the CMT Rate
Determination Date of three Reference Dealers in The City of New
York (from five such Reference Dealers selected by the
Calculation Agent, in its discretion (after consultation with the
Company), and eliminating the highest quotation (or, in the event
of equality, one of the highest) and the lowest quotation (or, in
the event of equality, one of the lowest)), for Treasury notes
with an original maturity of the number of years that is the next
highest to the Designated CMT Maturity Index and a remaining term
to maturity closest to the Designated CMT Maturity Index and in
an amount of at least $100 million, or (f) if three or four (and
not five) of such Reference dealers are quoting as described
above, the arithmetic mean of the offer prices obtained without
the elimination of either the highest or the lowest of such
quotes; provided, however, that if fewer than three Reference
Dealers selected by the Calculation Agent are quoting as
described above, the CMT Rate for such Interest Reset Period will
be the same as the CMT Rate for the immediately preceding
Interest Reset Period (or, if there was no such previous Interest
Reset Period, the rate of interest hereon for such Interest Reset
Period shall be the Initial Interest Rate). For purposes of
clause (e) in the first sentence of this paragraph, if two
Treasury notes have remaining terms to maturity equally close to
the Designated CMT Maturity Index, the quotes for the Treasury
note with the shorter remaining term to maturity shall be used.
"Designated CMT Maturity Index" shall be the original period
to maturity of the U.S. Treasury securities (either 1, 2, 3, 5,
7, 10, 20 or 30 years) specified above with respect to which the
CMT Rate will be calculated. If no such maturity is specified
above, the Designated CMT Maturity Index shall be 2 years.
"Designated CMT Telerate Page" means the display on the Dow
Jones Market service (formerly known as the Dow Jones Telerate
Service) on the page specified above (or any other page as may
replace such page on that service, or any successor service, for
the purpose of displaying Treasury Constant Maturities as
reported in H.15(519)), for the purpose of displaying Treasury
Constant Maturities as reported in H.15(519). If no such page is
specified above, the page shall be 7052, for the most recent
week.]
[DETERMINATION OF COMMERCIAL PAPER RATE.
If the Base Rate specified above is the Commercial Paper
Rate, this Security shall bear interest for each Interest Reset
Period at a rate calculated with reference to the Commercial
Paper Rate, determined as set forth below, and the Spread or
Spread Multiplier, if any, and subject to the Maximum Interest
Rate, if any, and the Minimum Interest Rate, if any, specified
above.
The "Commercial Paper Rate" for each Interest Reset Period
shall be determined by the Calculation Agent on the Calculation
Date and shall be (a) the Money Market Yield (as hereinafter
defined) as of the second Business Day prior to the related
Interest Reset Date (a "Commercial Paper Rate Determination
Date") of the rate (expressed as a percentage per annum) for
commercial paper having the Index Maturity specified above, as
such rate shall be published in H.15(519) (as hereinafter
defined) under the heading "Commercial Paper - Nonfinancial", or
(b) if such rate is not so published prior to 9:00 a.m., New York
City time, on the Calculation Date, the Money Market Yield as of
such Commercial Paper Rate Determination Date of the rate for
commercial paper of the Index Maturity as published in Composite
Quotations (as hereinafter defined) under the heading "Commercial
Paper", or (c) if none of such rates is published by 3:00 p.m.,
New York City time, on the Calculation Date, the Money Market
Yield of the arithmetic mean of the offered rates, as of 11:00
a.m., New York City time, on such Commercial Paper Rate
Determination Date, of three leading dealers in commercial paper
in The City of New York selected by the Calculation Agent, in its
discretion (after consultation with the Company), for commercial
paper of the Index Maturity placed for a nonfinancial issuer
whose bond rating is "AA," or the equivalent, from a nationally
recognized statistical rating organization; provided, however,
that if the dealers selected as aforesaid are not quoting offered
rates as described in clause (c) above, the Commercial Paper Rate
for such Interest Reset Period shall be deemed to be the same as
the Commercial Paper Rate for the preceding Interest Reset Period
(or, if there was no such previous Interest Reset Period, the
rate of interest hereon for such Interest Reset Period shall be
the Initial Interest Rate).
"Money Market Yield" shall be a yield calculated in
accordance with the following formula:
Money Market Yield = D x 360 x 100
-------------
360 - (D x M)
where "D" refers to the applicable per annum rate for commercial
paper quoted on a bank discount basis and expressed as a decimal,
and "M" refers to the actual number of days in the Index Maturity
specified above.]
[DETERMINATION OF FEDERAL FUNDS RATE.
If the Base Rate specified above is the Federal Funds Rate,
this Security shall bear interest for each Interest Reset Period
at a rate calculated with reference to the Federal Funds Rate,
determined as set forth below, and the Spread or Spread
Multiplier, if any, and subject to the Maximum Interest Rate, if
any, and the Minimum Interest Rate, if any, specified above.
The "Federal Funds Rate" for each Interest Reset Period
shall be determined by the Calculation Agent on the Calculation
Date and shall be (a) the rate (expressed as a percentage per
annum) as of the second Business Day prior to the related
Interest Reset Date (a "Federal Funds Rate Determination Date")
for Federal funds as published in H.15(519) under the heading
"Federal Funds (Effective)", or (b) if such rate is not so
published by 9:00 A.M., New York City time, on the Calculation
Date, the rate on such Federal Funds Rate Determination Date as
published in Composite Quotations under the heading "Federal
Funds/Effective Rate", or (c) if neither of such rates is
published by 3:00 P.M., New York City time, on the Calculation
Date, the arithmetic mean of the rates for the last transaction
in overnight Federal funds as of 11:00 A.M., New York City time,
on such Federal Funds Rate Determination Date arranged by three
leading brokers in Federal Funds transactions in The City of New
York selected by the Calculation Agent, in its discretion (after
consultation with the Company); provided, however, that if the
brokers selected as aforesaid by the Calculation Agent are not
quoting as described in clause (c) above, the Federal Funds Rate
for such Interest Reset Period shall be the same as the Federal
Funds Rate for the immediately preceding Interest Reset Period
(or, if there was no such previous Interest Reset Period, the
rate of interest hereon for such Interest Reset Period shall be
the Initial Interest Rate).]
[DETERMINATION OF LIBOR
If the Base Rate specified above is LIBOR, this Security
shall bear interest for each Interest Reset Period at a rate
calculated with reference to LIBOR, determined as set forth
below, and the Spread or Spread Multiplier, if any, and subject
to the Maximum Interest Rate, if any, and the Minimum Interest
Rate, if any, specified above.
"LIBOR" for each Interest Reset Period shall be determined
by the Calculation Agent and shall be:
(a)(i) if "LIBOR Reuters" is specified above as the
Reporting Service, the arithmetic mean of the offered rates
(unless the specified Designated LIBOR Page (as hereinafter
defined) by its terms provides only for a single rate, in
which case such single rate shall be used) for deposits in
the Index Currency specified above in the London interbank
market, for the period of the Index Maturity specified above
commencing on the related Interest Reset Date for such
Interest Reset Period, which appear or appears on the
Designated LIBOR Page at approximately 11:00 a.m., London
time, on the second London Banking Day (as hereinafter
defined) prior to such Interest Reset Date (a "LIBOR"
Determination Date"), or (ii) if "LIBOR Telerate" is
specified above as the Reporting Service, the rate for
deposits in the Index Currency, for the period of the Index
Maturity commencing on such Interest Reset Date (or, if the
pound sterling is the Index Currency, commencing on the
LIBOR Determination Date) that appears on the Designated
LIBOR Page at approximately 11:00 a.m., London time, on such
LIBOR Determination Date;
(b) with respect to a LIBOR Determination Date on
which fewer than two offered rates appear (if "LIBOR
Reuters" is specified above as the Reporting Service and
calculation of LIBOR is based on the arithmetic mean of the
offered rates) or on which no rate appears (if the Reporting
Service specified above is either (x) "LIBOR Reuters" and
the Designated LIBOR Page by its terms provides only for a
single rate or (y) "LIBOR Telerate"), the Calculation Agent
shall request the principal London office of each of four
major reference banks in the London interbank market
selected by the Calculation Agent, in its discretion (after
consultation with the Company), to provide the Calculation
Agent with its offered quotations for deposits in the Index
Currency, for the period of the Index Maturity commencing on
the Interest Reset Date (or, if the pound sterling is the
Index Currency, commencing on the LIBOR Determination Date)
for such Interest Reset Period and in a principal amount
equal to an amount of not less than U.S.$1 million (or the
equivalent amount in the Index Currency) that is
representative of a single transaction in the Index Currency
in such market at such time, to prime banks in the London
interbank market at approximately 11:00 a.m., London time,
on such LIBOR Determination Date; if at least two such
quotations are provided, LIBOR, in respect of such LIBOR
Determination Date, shall be the arithmetic mean of such
quotations;
(c) if fewer than two such quotations are so provided,
LIBOR in respect of such LIBOR Determination Date shall be
the arithmetic mean of the rates quoted by three major banks
in the applicable Principal Financial Center for the country
of the Index Currency on such LIBOR Determination Date
selected by the Calculation Agent, in its discretion (after
consultation with the Company), at approximately 11:00 a.m.
on such LIBOR Determination Date, for loans in the Index
Currency to leading European banks, for the period of the
Index Maturity commencing on the Interest Reset Date (or,
if the pound sterling is the Index Currency, commencing on
the LIBOR Determination Date) for such Interest Reset Period
and in a principal amount of not less than U.S.$1 million
(or the equivalent amount in the Index Currency) that is
representative of a single transaction in the Index Currency
in such market at such time; provided, however, that if
fewer than three banks selected as aforesaid by the
Calculation Agent are quoting rates described in this
clause (c), LIBOR for such Interest Reset Period shall be
the same as LIBOR for the immediately preceding Interest
Reset Period (or, if there was no such previous Interest
Reset Period, the rate of interest hereon for such Interest
Reset Period shall be the Initial Interest Rate).
"Designated LIBOR Page" means (x) if "LIBOR Reuters" is
specified above as the Reporting Service, the display on the
Reuters monitor money rates service (or any successor service)
for the purpose of displaying the London interbank rates of major
banks for the applicable Index Currency, or (y) if "LIBOR
Telerate" is specified above as the Reporting Service, the
display on the Dow Jones Market service (formerly, known as the
Dow Jones Telerate Service), or any successor service, for the
purpose of displaying the London interbank rates of major banks
for the Index Currency. If neither LIBOR Reuters nor LIBOR
Telerate is specified above as the Reporting Service, LIBOR shall
be determined as if LIBOR Telerate Page 3750 had been specified.
"Index Currency" means the currency (including any composite
currency) so specified above. If no such currency is so
specified above, "Index Currency" means U.S. dollars.
"LIBOR Telerate Page 3750" means the display designated as
"Page 3750" on the Dow Jones Market service (formerly, known as
the Dow Jones Telerate Service), or such other page as may
replace Page 3750 on such service or such other successor service
or services as may be nominated by the British Bankers'
Association as the information vendor for the purpose of
displaying London interbank offered rates for U.S. dollar
deposits.]
"Principal Financial Center" will be, for purposes of clause
(c) above, the principal financial center of the country of the
specified Index Currency, which generally will be the capital
city of such country, except that with respect to U.S. Dollars,
Deutsche Marks and Euros, the Principal Financial Center shall be
the City of New york, Frankfurt or Brussels, as the case may be.
[DETERMINATION OF PRIME RATE.
If the Base Rate specified above is the Prime Rate, this
Security shall bear interest for each Interest Rest Period at a
rate calculated with reference to the Prime Rate, determined as
set forth below, and the Spread or Spread Multiplier, if any, and
subject to the Maximum Interest Rate, if any, and the Minimum
Interest Rate, if any, specified above.
The "Prime Rate" for each Interest Reset Period shall be
determined by the Calculation Agent on the Calculation Date and
shall be (a) the rate (expressed as a percentage per annum) as of
the second Business Day prior to the related Interest Reset Date
(a "Prime Rate Determination Date") set forth in H.15(519)
opposite the caption "Bank Prime Loan", or (b) if such rate is
not so published prior to 3:00 p.m., New York City time, on the
Calculation Date, the arithmetic mean of the rates publicly
announced by each bank named on the Reuters Screen USPRIME1 Page
(as defined below) as such bank's prime rate or base lending rate
as in effect on such Prime Rate Determination Date as quoted on
the Reuters Screen USPRIME1 Page on such Prime Rate Determination
Date or (c) if fewer than four such rates appear on the Reuters
Screen USPRIME1 Page for such Prime Rate Determination Date, the
arithmetic mean of the prime rates quoted on the basis of the
actual number of days in the year divided by 360 as of the close
of business on such Prime Rate Determination Date by at least two
of three major money center banks in The City of New York
selected by the Calculation Agent, in its discretion (after
consultation with the Company), from which quotations are
requested; provided, however, that if fewer than two such prime
rates are so quoted by major money center banks as aforesaid,
there shall be included in the group of rates whose arithmetic
mean is to be so determined the prime rates or base lending
rates, as of such Prime Rate Determination Date, of that number
of substitute banks or trust companies organized and doing
business under the laws of the United States, or any State
thereof, in each case having total equity capital of at least
U.S. $500 million and being subject to supervision or examination
by Federal or State authority, selected by the Calculation Agent,
in its discretion (after consultation with the Company), which,
when added to the number of rates provided by major money center
banks as aforesaid, shall equal two.
If in any calendar month the Prime Rate is not published in
H.15(519) and the banks or trust companies selected as aforesaid
are not quoting as described in the preceding paragraph, the
"Prime Rate" for the applicable Interest Reset Period shall be
Prime Rate for the immediately preceding Interest Reset Period
(or, if there was no such previous Interest Reset Period, the
rate of interest hereon for such Interest Reset Period shall be
the Initial Interest Rate).
"Reuters Screen USPRIME1 Page" means the display designated
as Page "USPRIME1" on the Reuters monitor money rates service (or
such other page as may replace the USPRIME1 Page on that service
for the purpose of displaying prime rates or base lending rates
of major United States banks).]
[DETERMINATION OF TREASURY RATE
If the Base Rate specified above is the Treasury Rate, this
Security shall bear interest for each Interest Reset Period at a
rate calculated with reference to the Treasury Rate, determined
as set forth below, and the Spread or Spread Multiplier, if any,
and subject to the Maximum Interest Rate, if any, and the Minimum
Interest Rate, if any, specified above.
The "Treasury Rate" for each Interest Reset Period shall be
determined by the Calculation Agent on the Calculation Date and
shall be (a) the rate (expressed as a percentage per annum) for
the auction held on the Treasury Rate Determination Date (as
hereinafter defined) for such Interest Reset Period of direct
obligations of the United States ("Treasury bills") having the
Index Maturity specified above, as such rate shall be published
in H.15(519) under the heading "U.S. Government Securities -
Treasury bills - auction average (investment)", or (b) if such
rate is not published prior to 9:00 a.m., New York City time, on
the Calculation Date, the auction average rate (expressed as a
bond equivalent on the basis of a year of 365 or 366 days, as
applicable, and applied on a daily basis) on such Treasury Rate
Determination Date as otherwise announced by the United States
Department of Treasury, or (c) if the results of the auction of
Treasury bills having such Index Maturity are not published or
reported as provided above by 3:00 p.m., New York City time, on
the Calculation Date, or if no such auction is held on such
Treasury Rate Determination Date, a yield to maturity (expressed
as a bond equivalent on the basis of a year of 365 or 366 days,
as applicable, and applied on a daily basis) of the arithmetic
mean of the secondary market bid rates, as of approximately 3:30
p.m., New York City time, on such Treasury Rate Determination
Date, of three leading primary United States government
securities dealers selected by the Calculation Agent, in its
discretion (after consultations with the Company), for the issue
of Treasury bills with a remaining maturity closest to such Index
Maturity; provided, however, that if the dealers selected as
aforesaid by the Calculation Agent are not quoting bid rates as
described in clause (c) above, then the "Treasury Rate" for such
Interest Reset Period shall be deemed to be the same as the
Treasury Rate for the immediately preceding Interest Reset Period
(or, if there was no such previous Interest Reset Period, the
rate of interest hereon for such Interest Reset Period shall be
the Initial Interest Rate).
The "Treasury Rate Determination Date" for each Interest
Reset Period shall be the day of the week in which the Interest
Reset Date for such Interest Reset Period falls on which Treasury
bills would normally be auctioned. (As of the Original Interest
Accrual Date, Treasury bills are normally sold at auction on
Monday of each week, unless that day is a legal holiday, in which
case the auction is normally held on the following Tuesday,
except that such auction may be held on the preceding Friday.)
If, as the result of a legal holiday, an auction is so held on
the preceding Friday, such Friday shall be the Treasury Rate
Determination Date pertaining to the Interest Reset Period
commencing in the next succeeding week. If an auction date shall
fall on any day that would otherwise be an Interest Reset Date
for a Treasury Rate Note, then such Interest Reset Date shall
instead be the Business Day immediately following such auction
date.]
If, as specified above, this Security is redeemable, this
Security is subject to redemption at any time on or after the
Initial Redemption Date specified above, as a whole or in part,
at the election of the Company, at the applicable redemption
price (as described below) plus accrued interest to the date
fixed for redemption. Such redemption price shall be the Initial
Redemption Price specified above for the twelve-month period
commencing on the Initial Redemption Date and shall decline for
the twelve-month period commencing on each anniversary of the
Initial Redemption Date by a percentage of principal amount equal
to the Reduction Percentage specified above until such redemption
price is 100% of the principal amount of this Security to be
redeemed.
Notwithstanding the foregoing, the Company may not, prior to
the Redemption Limitation Date, if any, specified above, redeem
this Security as contemplated above as a part of, or in
anticipation of, any refunding operation by the application,
directly or indirectly, of moneys borrowed having an effective
interest cost to the Company (calculated in accordance with
generally accepted financial practice) less than the effective
interest cost to the Company (similarly calculated) of this
Security.
[Insert provisions, if any, for redemption pursuant to a
sinking fund or analogous provision or at the option of the
Holder.]
Notice of redemption [(other than at the election of the
Holder)] shall be given by mail to Holders of Securities, not
less than 30 days nor more than 60 days prior to the date fixed
for redemption, all as provided in the Indenture. As provided in
the Indenture, notice of redemption at the election of the
Company as aforesaid may state that such redemption shall be
conditional upon the receipt by the Trustee of money sufficient
to pay the principal of and premium, if any, and interest, if
any, on this Security on or prior to the date fixed for such
redemption; a notice of redemption so conditioned shall be of no
force or effect if such money is not so received and, in such
event, the Company shall not be required to redeem this Security.
In the event of redemption of this Security in part only, a
new Security or Securities of this series, of like tenor, for the
unredeemed portion hereof will be issued in the name of the
Holder hereof upon the cancellation hereof.
If an Event of Default shall occur and be continuing, the
principal of this Security may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the Trustee to enter into one or more supplemental
indentures for the purpose of adding any provisions to, or
changing in any manner or eliminating any of the provisions of,
the Indenture with the consent of the Holders of not less than a
majority in aggregate principal amount of the Securities of all
series then Outstanding under the Indenture, considered as one
class; provided, however, that if there shall be Securities of
more than one series Outstanding under the Indenture and if a
proposed supplemental indenture shall directly affect the rights
of the Holders of Securities of one or more, but less than all,
of such series, then the consent only of the Holders of a
majority in aggregate principal amount of the Outstanding
Securities of all series so directly affected, considered as one
class, shall be required; and provided, further, that if the
Securities of any series shall have been issued in more than one
Tranche and if the proposed supplemental indenture shall directly
affect the rights of the Holders of Securities of one or more,
but less than all, of such Tranches, then the consent only of the
Holders of a majority in aggregate principal amount of the
Outstanding Securities of all Tranches so directly affected,
considered as one class, shall be required; and provided,
further, that the Indenture permits the Trustee to enter into one
or more supplemental indentures for limited purposes without the
consent of any Holders of Securities. The Indenture also
contains provisions permitting the Holders of a majority in
principal amount of the Securities then Outstanding, on behalf of
the Holders of all Securities, to waive compliance by the Company
with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be
conclusive and binding upon such Holder and upon all future
Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange therefor or in
lieu hereof, whether or not notation of such consent or waiver is
made upon this Security.
As provided in the Indenture and subject to certain
limitations therein set forth, this Security or any portion of
the principal amount hereof will be deemed to have been paid for
all purposes of the Indenture and to be no longer Outstanding
thereunder, and, at the election of the Company, the Company's
entire indebtedness in respect thereof will be satisfied and
discharged, if there has been irrevocably deposited with the
Trustee or any Paying Agent (other than the Company), in trust,
money in an amount which will be sufficient and/or Eligible
Obligations, the principal of and interest on which when due,
without regard to any reinvestment thereof, will provide moneys
which, together with moneys so deposited, will be sufficient to
pay when due the principal of and interest on this Security when
due.
The Indenture contains terms, provisions and conditions
relating to the consolidation or merger of the Company with or
into, and the conveyance or other transfer, or lease, of assets
to, another Person, to the assumption by such other Person, in
certain circumstances, of all of the obligations of the Company
under the Indenture and on the Securities and to the release and
discharge of the Company, in certain circumstances, from such
obligation.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is
registrable in the Security Register, upon surrender of this
Security for registration of transfer at the corporate trust
office of The Chase Manhattan Bank in New York, New York or such
other office or agency as may be designated by the Company from
time to time, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and
the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more
new Securities of this series of authorized denominations and of
like tenor and aggregate principal amount, will be issued to the
designated transferee or transferees.
The Securities of this series are issuable only as
registered Securities, without coupons, and in denominations of
. As provided in the Indenture and subject to
------------
certain limitations therein set forth, Securities of this series
are exchangeable for a like aggregate principal amount of
Securities of the same series and Tranche, of any authorized
denominations, as requested by the Holder surrendering the same,
and of like tenor upon surrender of the Security or Securities to
be exchanged at the corporate trust office of The Chase Manhattan
Bank in New York, New York or such other office or agency as may
be designated by the Company from time to time.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Prior to due surrender of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name this Security
is registered as the absolute owner hereof for all purposes
(subject to Section 307 of the Indenture), whether or not this
Security be overdue, and neither the Company, the Trustee nor any
such agent shall be affected by notice to the contrary.
The Indenture and the Securities shall be governed by and
construed in accordance with the laws of the State of New York,
except to the extent that the Trust Indenture Act shall be
applicable.
As used herein,
(1) "Business Day" means any day, other than a Saturday or
Sunday, which is (a) not a day on which banking
institutions or trust companies in The City of New
York, New York or other city in which is located any
office or agency maintained for the payment of
principal of or premium, if any, or interest on this
Security, are authorized or required by law, regulation
or executive order to remain closed and (b) if the Base
Rate specified above is LIBOR, a London Banking Day.
"London Banking Day" means any day on which dealings in
deposits in the Index Currency, if any, specified above
are transacted in the London Interbank market;
(2) "Calculation Date", with respect to a Rate
Determination Date, means the earlier of (a) the tenth
calendar day after such Rate Determination Date, or, if
such day is not a Business Day, the next succeeding
Business Day, and (b) the Business Day next preceding
the related Interest Payment Date or the Maturity Date,
as the case may be;
(3) "Composite Quotations" means the daily statistical
release entitled "Composite 3:30 p.m. Quotations for
U.S. Government Securities," or any successor release,
published by the Federal Reserve Bank of New York;
(4) "H.15(519)" means the publication entitled "Statistical
Release H.15(519)," Selected Interest Rates, or any
successor publication, published by the Board of
Governors of the Federal Reserve System; and
(5) "Rate Determination Date" means, as applicable, a "CD
Rate Determination Date", a "CMT Rate Determination
Date", a "Commercial Paper Rate Determination Date", a
"Federal Funds Rate Determination Date", a "LIBOR
Determination Date", a "Prime Rate Determination Date"
or a "Treasury Rate Determination Date".
All other terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the
Indenture.
As provided in the Indenture, no recourse shall be had for
the payment of the principal of or premium, if any, or interest
on any Securities, or any part thereof, or for any claim based
thereon or otherwise in respect thereof, or of the indebtedness
represented thereby, or upon any obligation, covenant or
agreement under the Indenture, against, and no personal liability
whatsoever shall attach to, or be incurred by, any incorporator,
shareholder, officer or director, as such, past, present or
future of the Company or of any predecessor or successor
corporation (either directly or through the Company or a
predecessor or successor corporation), whether by virtue of any
constitutional provision, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise; it being
expressly agreed and understood that the Indenture and all the
Securities are solely corporate obligations and that any such
personal liability is hereby expressly waived and released as a
condition of, and as part of the consideration for, the execution
of the Indenture and the issuance of the Securities.
Unless the certificate of authentication hereon has been
executed by the Trustee or an Authenticating Agent by manual
signature, this Security shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument
to be duly executed.
THE WASHINGTON WATER POWER COMPANY
By:
------------------------------------------
[Title]
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated
therein referred to in the within-mentioned Indenture.
Dated:
----------------------
OR
----------------------- -----------------------
, ,
----------------------- -----------------------
AS TRUSTEE AS TRUSTEE
By: By:[ ],
---------------------------
Authorized Officer AS AUTHENTICATING AGENT
By:
--------------------------
Authorized Officer
This Security may not be transferred or exchanged, nor may
any purported transfer be registered, except (i) this Security
may be transferred in whole, and appropriate registration of
transfer effected, if such transfer is by Cede & Co., as nominee
for The Depository Trust Company (the "Depositary"), to the
Depositary, or by the Depositary to another nominee thereof, or
by any nominee of the Depositary to any other nominee thereof, or
by the Depositary or any nominee thereof to any successor
securities depositary or any nominee thereof; and (ii) this
Security may be exchanged for definitive Securities registered in
the respective names of the beneficial holders hereof, and
thereafter shall be transferable without restrictions if: (A) the
Depositary, or any successor securities depositary, shall have
notified the Company and the Trustee that it is unwilling or
unable to continue to act as securities depositary with respect
to the Securities and the Trustee shall not have been notified by
the Company within ninety (90) days of the identity of a
successor securities depositary with respect to the Securities;
(B) the Company shall have delivered to the Trustee a Company
Order to the effect that the Securities shall be so exchangeable
on and after a date specified therein; or (C)(1) an Event of
Default shall have occurred and be continuing, (2) the Trustee
shall have given notice of such Event of Default pursuant to
Section 802 of the Indenture and (3) there shall have been
delivered to the Company and the Trustee an Opinion of Counsel to
the effect that the interests of the beneficial owners of the
Securities in respect thereof will be materially impaired unless
such owners become Holders of definitive Securities.
----------
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto
-----------------------------------------------------------------
[please insert social security or other identifying number
of assignee]
-----------------------------------------------------------------
[please print or typewrite name and address of assignee]
-----------------------------------------------------------------
the within Security of THE WASHINGTON WATER POWER COMPANY and
does hereby irrevocably constitute and appoint
-----------------
, Attorney, to transfer said
------------------------------
Security on the books of the within-mentioned Company, with full
power of substitution in the premises.
Dated:
-------------------
-------------------------------------
Notice: The signature to this assignment must correspond with
the name as written upon the face of the Security in every
particular without alteration or enlargement or any change
whatsoever.
=================================================================
THE WASHINGTON WATER POWER COMPANY
----------------------------
OFFICER'S CERTIFICATE
(Under Section 301 of the Indenture,
dated as of , 1998)
--------
Establishing Series of Securities Designated
Medium-Term Notes, Series C
-------------------------------
, 1998
----------
=================================================================
THE WASHINGTON WATER POWER COMPANY
OFFICER'S CERTIFICATE
(Under Section 301 of the Indenture,
dated as of , 1998)
-------
I, , a of
------------------ ------------------------
THE WASHINGTON WATER POWER COMPANY (the "Company"), in accordance
with Section 301 of the Indenture, dated as of , 1998
--------- --
(the "Indenture", capitalized terms used herein and not defined
herein having the meanings specified in the Indenture), of the
Company to The Chase Manhattan Bank, trustee (the "Trustee"), do
hereby establish a series of Securities having the terms and
characteristics set forth in this Officer's Certificate.
PART I
Set forth below in this Part I are the terms and
characteristics of the series of Securities established hereby
referred to in clauses (a) through (t) in the second paragraph of
Section 301 of the Indenture (the lettered clauses set forth
herein corresponding to such clauses in said Section 301).
(a) the title of the Securities of such series, being
Series No. 1 under the Indenture, shall be "Medium-Term Notes,
Series C" (the Securities of such series, for purposes of this
Officer's Certificate, being sometimes hereinafter called the
"Notes");
(b) the aggregate principal amount of Notes which may
be authenticated and delivered under the Indenture shall not be
limited;
(c) interest on the Notes shall be payable to the
Person or Persons in whose names the Notes are registered at the
close of business on the Regular Record Date for such interest,
except as otherwise expressly provided in the forms of Note
attached hereto and hereby authorized and approved;
(d) the date or dates on which the principal of the
Notes shall be payable shall be determined at the time of sale of
the Notes, or any Tranche thereof, by the proper officers of the
Company and communicated to the Trustee by Company Order, or by
the proper officers of the Company pursuant to the Administrative
Procedure (the "Administrative Procedure") attached as Annex II
to the Distribution Agreement dated , 1998 among the
--------- --
Company, Morgan Stanley & Co. Incorporated, Merrill Lynch & Co.
and Salomon Brothers Inc; provided, however, that in no event
shall any Note have a term less than nine months or more than 40
years;
(e) the Notes, or any Tranche thereof, may bear
interest at a fixed rate (any such Note being hereinafter called
a "Fixed Rate Note") or at a floating rate (any such Note being
hereinafter called a "Floating Rate Note"), or they may bear no
interest. There shall be determined by the proper officers of
the Company and communicated to the Trustee by Company Order, or
by the proper officers of the Company pursuant to the
Administrative Procedure, at the time of sale of the Notes or any
Tranche thereof,
(i) in the case of Fixed Rate Notes, the interest rate
or rates (including the interest rate, if any, on overdue
principal, premium or interest, if any) applicable to such
Fixed Rate Notes, or Tranche thereof and
(ii) in the case of Floating Rate Notes, the Initial
Interest Rate, the Base Rate (which shall be the CD Rate,
the CMT Rate, Commercial Paper Rate, the Federal Funds Rate,
LIBOR, the Prime Rate, the Treasury Rate or any other Base
Rate determined at the time of sale of the Notes or Tranche
thereof), the Maximum Interest Rate, if any, the Minimum
Interest Rate, if any, the Interest Payment Period, the
Interest Reset Period, the Interest Reset Dates, the Rate
Determination Dates, the Index Maturity, the Spread, if any,
the Spread Multiplier, if any (each of such terms being
referred to in the form of Floating Rate Note attached
hereto), any other terms relating to the determination of
the interest rates on Floating Rate Notes and the interest
rate, if any, on overdue principal, premium or interest, if
any, applicable to such Floating Rate Notes or Tranche
thereof;
interest shall accrue on any Note from the Original Interest
Accrual Date specified in such Note or the most recent date to
which interest has been paid or duly provided for; the Interest
Payment Dates on the Notes shall be determined at the time of
sale of the Notes of each Tranche by the proper officers of the
Company and communicated to the Trustee by Company Order, or
determined by the proper officers of the Company pursuant to the
Administrative Procedure, and the Regular Record Date with
respect to each such Interest Payment Date shall be the date 15
calendar days immediately preceding such Interest Payment Date
(whether or not a Business Day); and interest on Floating Rate
Notes which employ the Treasury Rate as the Base Rate shall be
computed on the basis of the actual number of days in the year;
(f) the corporate trust office of The Chase Manhattan
Bank in New York, New York shall be the place at which (i) the
principal of, premium, if any, and interest, if any, on the Notes
at Maturity shall be payable upon presentment, interest prior to
Maturity to be paid as specified in the forms of Note attached
hereto, (ii) registration of transfer of the Notes may be
effected, (iii) exchanges of Notes may be effected and (iv)
notices and demands to or upon the Company in respect of the
Notes and the Indenture may be served; and The Chase Manhattan
Bank shall be the Security Registrar and a Paying Agent for the
Notes; provided, however, that the Company reserves the right to
change, by one or more Officer's Certificates supplemental to
this Officer's Certificate, any such place or the Security
Registrar or such Paying Agent; and provided, further, that the
Company reserves the right to designate, by one or more Officer's
Certificates supplemental to this Officer's Certificate, its
principal corporate office in Spokane, Washington as any such
place or itself as the Security Registrar;
(g) the Notes, or any Tranche thereof, shall be
redeemable in whole or in part, at the option of the Company as
and to the extent determined at the time of sale of the Notes or
any Tranche thereof by the proper officers of the Company and
communicated to the Trustee by Company Order, or determined by
the proper officers of the Company pursuant to the Administrative
Procedures;
(h) the obligation, if any, of the Company to redeem
or purchase the Notes or any Tranche thereof pursuant to any
sinking fund or analogous provisions or at the option of a Holder
thereof and the period or periods within which, the price or
prices at which, and the terms and conditions upon which, such
Notes or Tranche thereof shall be redeemed or purchased, in whole
or in part, pursuant to such obligation shall be determined at
the time of sale of the Notes or Tranche thereof by the proper
officers of the Company and communicated to the Trustee by
Company Order, or determined by the proper officers of the
Company pursuant to the Administrative Procedures;
(i) the Notes shall be issued in denominations of
$1,000 and any integral multiple thereof;
(j) inapplicable;
(k) inapplicable;
(l) inapplicable;
(m) inapplicable;
(n) inapplicable;
(o) inapplicable;
(p) inapplicable;
(q) the Notes are initially to be issued in global
form, registered in the name of Cede & Co., as nominee for The
Depository Trust Company (the "Depositary"). Such Notes shall
not be transferable or exchangeable, nor shall any purported
transfer be registered, except as follows:
(i) such Notes may be transferred in whole, and
appropriate registration of transfer effected, if such
transfer is by such nominee to the Depositary, or by the
Depositary to another nominee thereof, or by any nominee of
the Depositary to any other nominee thereof, or by the
Depositary or any nominee thereof to any successor
securities depositary or any nominee thereof; and
(ii) such Notes may be exchanged for definitive Notes
registered in the respective names of the beneficial holders
thereof, and thereafter shall be transferable without
restriction, if:
(A) The Depositary, or any successor securities
depositary, shall have notified the Company and the
Trustee that it is unwilling or unable to continue to
act as securities depositary with respect to such Notes
and the Trustee shall not have been notified by the
Company within ninety (90) days of the identity of a
successor securities depositary with respect to such
Notes;
(B) the Company shall have delivered to the Trustee a
Company Order to the effect that such Notes shall be so
exchangeable on and after a date specified therein; or
(C) (I) an Event of Default shall have occurred and be
continuing, (II) the Trustee shall have given notice of
such Event of Default pursuant to Section 802 of the
Indenture and (III) there shall have been delivered to
the Company and the Trustee an Opinion of Counsel to
the effect that the interests of the beneficial owners
of such Notes in respect thereof will be materially
impaired unless such owners become Holders of
definitive Notes;
it being understood that any such registration of transfer or
exchange shall be effected in accordance with Section 305 of the
Indenture;
(r) inapplicable;
(s) no service charge shall be made for the
registration of transfer or exchange of the Notes, or any Tranche
thereof; provided, however, that the Company may require payment
of a sum sufficient to cover any tax or other governmental charge
payable in connection with such transfer or exchange; and
(t) Section 113 of the Indenture shall apply to the
Notes, except to the extent that the provisions of the Floating
Rate Notes hereinafter authorized and approved which are
inconsistent with Section 113, and, to the extent of such
inconsistency, the provisions of the Floating Rate Notes shall
apply in lieu of the provisions of Section 113.
PART II
Set forth below in this Part II are additional terms of
the Medium-Term Notes, Series C, as contemplated by clause (u) in
the second paragraph of Section 301 of the Indenture.
(a) the Notes shall have such further terms as are set
forth in the forms of Fixed Rate Note and Floating Rate Note
attached hereto as Exhibits A and B, respectively;
(b) if the Company shall make any deposit of money
and/or Government Obligations with respect to any Notes, or any
portion of the principal amount thereof, as contemplated by
Section 601 of the Indenture, the Company shall not deliver an
Officer's Certificate described in clause (z) in the first
paragraph of said Section 601 unless the Company shall also
deliver to the Trustee, together with such Officer's Certificate,
either:
(i) an instrument wherein the Company, notwithstanding
the satisfaction and discharge of its indebtedness in
respect of the Notes, shall assume the obligation (which
shall be absolute and unconditional) to irrevocably deposit
with the Trustee or Paying Agent such additional sums of
money, if any, or additional Government Obligations (meeting
the requirements of Section 601), if any, or any combination
thereof, at such time or times, as shall be necessary,
together with the money and/or Government Obligations
theretofore so deposited, to pay when due the principal of
and premium, if any, and interest due and to become due on
such Notes or portions thereof, all in accordance with and
subject to the provisions of said Section 601; provided,
however, that such instrument may state that the obligation
of the Company to make additional deposits as aforesaid
shall be subject to the delivery to the Company by the
Trustee of a notice asserting the deficiency accompanied by
an opinion of an independent public accountant of nationally
recognized standing showing the calculation thereof (which
opinion shall be obtained at the expense of the Company); or
(ii) an Opinion of Counsel to the effect that the
Holders of such Notes, or portions of the principal amount
thereof, will not recognize income, gain or loss for United
States federal income tax purposes as a result of the
satisfaction and discharge of the Company's indebtedness in
respect thereof and will be subject to United States federal
income tax on the same amounts, at the same times and in the
same manner as if such satisfaction and discharge had not
been effected; and
(c)(i) So long as any of the Notes shall remain
Outstanding, the Company shall not create, issue, incur or assume
any Secured Debt other than Permitted Secured Debt without the
consent of the Holders of a majority in principal amount of the
Outstanding Securities of all series (including the Notes) and
Tranches with respect to which this covenant is specified as
contemplated by Section 301, considered as one class (all such
Securities being hereinafter called the "Benefitted Securities").
(ii) The provisions of clause (c)(i) above shall not
prohibit the creation, issuance, incurrence or assumption of any
Secured Debt if either
(A) the Company shall make effective provision whereby
all Benefitted Securities then Outstanding shall be secured
equally and ratably with such Secured Debt; or
(B) the Company shall deliver to the Trustee bonds,
notes or other evidences of indebtedness secured by the Lien
which secures such Secured Debt (hereinafter called "Secured
Obligations") (I) in an aggregate principal amount equal to
the aggregate principal amount of the Benefitted Securities
then Outstanding, (II) maturing (or being subject to
mandatory redemption) on such dates and in such principal
amounts that, at each Stated Maturity of the Outstanding
Benefitted Securities, there shall mature (or be redeemed)
Secured Obligations equal in principal amount to the
Securities then to mature and (III) containing, in addition
to any mandatory redemption provisions applicable to all
Secured Obligations outstanding under such Lien and any
mandatory redemption provisions contained therein pursuant
to clause (II) above, mandatory redemption provisions
correlative to the provisions, if any, for the mandatory
redemption (pursuant to a sinking fund or otherwise) of the
Benefitted Securities or for the redemption thereof at the
option of the Holder, as well as a provision for mandatory
redemption upon an acceleration of the maturity of all
Outstanding Benefitted Securities following an Event of
Default (such mandatory redemption to be rescinded upon the
rescission of such acceleration); it being expressly
understood that such Secured Obligations (X) may, but need
not, bear interest, (Y) may, but need not, contain
provisions for the redemption thereof at the option of the
issuer, any such redemption to be made at a redemption price
or prices not less than the principal amount thereof and (Z)
shall be held by the Trustee for the benefit of the Holders
of all Benefitted Securities from time to time Outstanding
subject to such terms and conditions relating to surrender
to the Company, transfer restrictions, voting, application
of payments of principal and interest and other matters as
shall be set forth in an indenture supplemental hereto
specifically providing for the delivery to the Trustee of
such Secured Obligations.
(iii) If the Company shall elect either of the
alternatives described in clause (c)(ii) above, the Company shall
deliver to the Trustee:
(A) an indenture supplemental to the Indenture (I)
together with appropriate inter-creditor arrangements,
whereby all Securities then Outstanding shall be secured by
the Lien referred to in clause (c)(ii) above equally and
ratably with all other indebtedness secured by such Lien or
(II) providing for the delivery to the Trustee of Secured
Obligations;
(B) an Officer's Certificate (I) stating that, to the
knowledge of the signer, (1) no Event of Default has
occurred and is continuing and (2) no event has occurred and
is continuing which entitles the secured party under such
Lien to accelerate the maturity of the indebtedness
outstanding thereunder and (II) stating the aggregate
principal amount of indebtedness issuable, and then proposed
to be issued, under and secured by such Lien;
(C) an Opinion of Counsel (I) if the Benefitted
Securities then Outstanding are to be secured by such Lien,
to the effect that all such Securities then Outstanding are
entitled to the benefit of such Lien equally and ratably
with all other indebtedness outstanding under such Lien or
(II) if Secured Obligations are to be delivered to the
Trustee, to the effect that such Secured Obligations have
been duly issued under such Lien and constitute valid
obligations, entitled to the benefit of such Lien equally
and ratably with all other indebtedness then outstanding
under such Lien.
(iv) For all purposes of this clause (c), except as
otherwise expressly provided or unless the context otherwise
requires:
"DEBT", with respect to any Person, means (A)
indebtedness of such Person for borrowed money evidenced by
a bond, debenture, note or other written instrument or
agreement by which such Person is obligated to repay such
borrowed money and (B) any guaranty by such Person of any
such indebtedness of another Person. "Debt" does not
include, among other things, (X) indebtedness of such Person
under any installment sale or conditional sale agreement or
any other agreement relating to indebtedness for the
deferred purchase price of property or services, (Y)
obligations of such Person under any lease agreement
(including any lease intended as security), whether or not
such obligations are required to be capitalized on the
balance sheet of such Person under generally accepted
accounting principles, or (Z) liabilities secured by any
Lien on any property owned by such Person if and to the
extent that such Person has not assumed or otherwise become
liable for the payment thereof.
"EXCEPTED PROPERTY" means
(A) all cash on hand or in banks or other financial
institutions, deposit accounts, shares of stock, interests
in general or limited partnerships, bonds, notes, other
evidences of indebtedness and other securities, of
whatsoever kind and nature, not hereafter paid or delivered
to, deposited with or held by the Trustee hereunder or
required so to be;
(B) all contracts, leases, operating agreements and
other agreements of whatsoever kind and nature; all contract
rights, bills, notes and other instruments and chattel paper
(except to the extent that any of the same constitute
securities, in which case they are separately excepted from
the operation of this clause (w) under clause (A) above);
all revenues, income and earnings, all accounts, accounts
receivable and unbilled revenues, and all rents, tolls,
issues, products and profits, claims, credits, demands and
judgments; all governmental and other licenses, permits,
franchises, consents and allowances; and all patents, patent
licenses and other patent rights, patent applications, trade
names, trademarks, copyrights, claims, credits, choses in
action and other intangible property and general intangibles
including, but not limited to, computer software;
(C) all automobiles, buses, trucks, truck cranes,
tractors, trailers and similar vehicles and movable
equipment; all rolling stock, rail cars and other railroad
equipment; all vessels, boats, barges and other marine
equipment; all airplanes, helicopters, aircraft engines and
other flight equipment; all parts, accessories and supplies
used in connection with any of the foregoing; and all
personal property of such character that the perfection of a
security interest therein or other Lien thereon is not
governed by the Uniform Commercial Code as in effect in the
jurisdiction in which such property is located;
(D) all goods, stock in trade, wares, merchandise and
inventory held for the purpose of sale or lease in the
ordinary course of business; all materials, supplies,
inventory and other items of personal property which are
consumable (otherwise than by ordinary wear and tear) in
their use in the operation of any property of the Company;
all fuel, including nuclear fuel, whether or not any such
fuel is in a form consumable in the operation of any
property of the Company, including separate components of
any fuel in the forms in which such components exist at any
time before, during or after the period of the use thereof
as fuel; all hand and other portable tools and equipment;
all furniture and furnishings; and computers and data
processing, data storage, data transmission,
telecommunications and other facilities, equipment and
apparatus, which, in any case, are used primarily for
administrative or clerical purposes or are otherwise not
necessary for the operation or maintenance of the
facilities, machinery, equipment or fixtures of the Company
for (I) the generation, transmission or distribution of
electric energy, (II) the transmission, storage or
distribution of gas or (III) the appropriation, storage,
transmission or distribution of water;
(E) all coal, ore, gas, oil and other minerals and all
timber, and all rights and interests in any of the
foregoing, whether or not such minerals or timber shall have
been mined or extracted or otherwise separated from the
land; and all electric energy, gas (natural or artificial),
steam, water and other products generated, produced,
manufactured, purchased or otherwise acquired by the
Company;
(F) all real property, leaseholds, gas rights, wells,
gathering, tap or other pipe lines, or facilities, equipment
or apparatus, in any case used or to be used primarily for
the production or gathering of natural gas; and
(G) all property which is the subject of a lease
agreement designating the Company as lessee and all right,
title and interest of the Company in and to such property
and in, to and under such lease agreement, whether or not
such lease agreement is intended as security.
"LIEN" means any mortgage, deed of trust, pledge,
security interest, conditional sale or other title retention
agreement or any lease in the nature thereof.
"PERMITTED SECURED DEBT" means, as of any particular
time, any of the following:
(A) Secured Debt which matures less than one year from
the date of the issuance or incurrence thereof and is not
extendible at the option of the issuer; and any refundings,
refinancings and/or replacements of any such Secured Debt by
or with similar Secured Debt;
(B) Secured Debt secured by Purchase Money Liens or
any other Liens existing or placed upon property at the time
of, or within one hundred eighty (180) days after, the
acquisition thereof by the Company, and any refundings,
refinancings and/or replacements of any such Secured Debt;
provided, however, that no such Purchase Money Lien or other
Lien shall extend to or cover any property of the Company
other than (I) the property so acquired and improvements,
extensions and additions to such property and renewals,
replacements and substitutions of or for such property or
any part or parts thereof and (II) with respect to Purchase
Money Liens, other property subsequently acquired by the
Company;
(C) Secured Debt relating to governmental obligations
the interest on which is not included in gross income for
purposes of federal income taxation pursuant to Section 103
of the Internal Revenue Code of 1986, as amended (or any
successor provision of law), for the purpose of financing or
refinancing, in whole or in part, costs of acquisition or
construction of property to be used by the Company, to the
extent that the Lien which secures such Secured Debt is
required either by applicable law or by the issuer of such
governmental obligations or is otherwise necessary in order
to establish or maintain such exclusion from gross income;
and any refundings, refinancings and/or replacements of any
such Secured Debt by or with similar Secured Debt;
(D) Secured Debt (I) which is related to the
construction or acquisition of property not previously owned
by the Company or (II) which is related to the financing of
a project involving the development or expansion of property
of the Company and (III) in either case, the obligee in
respect of which has no recourse to the Company or any
property of the Company other than the property constructed
or acquired with the proceeds of such transaction or the
project financed with the proceeds of such transaction (or
the proceeds of such property or such project); and any
refundings, refinancings and/or replacements of any such
Secured Debt by or with Secured Debt described in clause
(III) above;
(E) Secured Debt permitted under clause (c)(ii) above;
and
(F) in addition to the Permitted Secured Debt
described in clauses (A) through (E) above, Secured Debt not
otherwise permitted in this clause (c) in an aggregate
principal amount not exceeding 10% of the total assets of
the Company and its consolidated subsidiaries, as shown on
the latest balance sheet of the Company and its consolidated
subsidiaries, audited by independent certified public
accountants, dated prior to the date of the creation,
issuance, incurrence or assumption of such Secured Debt.
"PURCHASE MONEY LIEN" means, with respect to any
property being acquired by the Company, a Lien on such
property which
(A) is taken or retained by the transferor of such
property to secure all or part of the purchase price
thereof;
(B) is granted to one or more Persons other than the
transferor which, by making advances or incurring an
obligation, give value to enable the grantor of such Lien to
acquire rights in or the use of such property;
(C) is held by a trustee or agent for the benefit of
one or more Persons described in clause (A) or (B) above,
provided that such Lien may be held, in addition, for the
benefit of one or more other Persons which shall have
theretofore given, or may thereafter give, value to or for
the benefit or account of the grantor of such Lien for one
or more other purposes; or
(D) otherwise constitutes a purchase money mortgage or
a purchase money security interest under applicable law;
and, without limiting the generality of the foregoing, for
purposes of this Indenture, the term Purchase Money Lien
shall be deemed to include any Lien described above whether
or not such Lien (X) shall permit the issuance or other
incurrence of additional indebtedness secured by such Lien
on such property, (Y) shall permit the subjection to such
Lien of additional property and the issuance or other
incurrence of additional indebtedness on the basis thereof
and/or (Z) shall have been granted prior to the acquisition
of such property, shall attach to or otherwise cover
property other than the property being acquired and/or shall
secure obligations issued prior and/or subsequent to the
issuance of the obligations delivered in connection with
such acquisition.
"SECURED DEBT", with respect to any Person, means Debt
created, issued, incurred or assumed by such Person which is
secured by a Lien upon any property (other than Excepted
Property) of the Company, real, personal or mixed, of
whatever kind or nature and wherever located, whether owned
at the date of the initial authentication and delivery of
the Notes, or thereafter acquired.
------------
IN WITNESS WHEREOF, I have executed this Officer's
Certificate this day of , 1998.
--- ----
------------------------------
Name:
Title:
FORM OF FIXED RATE NOTE
(See legend at the end of this Security for
restrictions on transfer and change of form)
THE WASHINGTON WATER POWER COMPANY
Medium-Term Notes, Series C
Original Interest Accrual Date: Redeemable: Yes No
-- --
Stated Maturity: Initial Redemption Date:
Interest Rate: Initial Redemption Price:
Interest Payment Dates: Reduction Percentage:
Regular Record Dates: Redemption Limitation Date:
Other Provisions:
OID: Yes No
-- --
Total Amount of OID (%):
Yield to Maturity (%):
Initial Accrual
Period OID (%):
(Constant - Yield Method)
This Security is not a Discount Security
within the meaning of the within-mentioned Indenture.
------------------------------
Principal Amount Registered No.
$ CUSIP
THE WASHINGTON WATER POWER COMPANY, a corporation organized
and existing under the laws of the State of Washington (herein
called the "Company," which term includes any successor
corporation under the Indenture referred to below), for value
received, hereby promises to pay to
or registered assigns, the principal sum of
DOLLARS
on the Stated Maturity specified above, and to pay interest
thereon from the Original Interest Accrual Date specified above
or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, semi-annually in arrears on
the Interest Payment Dates specified above in each year,
commencing with the Interest Payment Date next succeeding the
Original Interest Accrual Date specified above, and at Maturity,
at the Interest Rate per annum specified above, until the
principal hereof is paid or duly provided for. The interest so
payable, and paid or duly provided for, on any Interest Payment
Date shall, as provided in such Indenture, be paid to the Person
in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular
Record Date specified above (whether or not a Business Day) next
preceding such Interest Payment Date. Notwithstanding the
foregoing, (a) if the Original Interest Accrual Date of this
Security is after a Regular Record Date and before the
corresponding Interest Payment Date, interest so payable for the
period from and including the Original Interest Accrual Date to
but excluding such Interest Payment Date shall be paid on the
next succeeding Interest Payment Date to the Holder hereof on the
related Regular Record Date; and (b) interest payable at Maturity
shall be paid to the Person to whom principal shall be paid.
Except as otherwise provided in said Indenture, any such interest
not so paid or duly provided for shall forthwith cease to be
payable to the Holder on such Regular Record Date and may either
be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on
a Special Record Date for the payment of such Unpaid Interest to
be fixed by the Trustee, notice of which shall be given to
Holders of Securities of this series not less than 15 days prior
to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be
listed, and upon such notice as may be required by such exchange,
all as more fully provided in said Indenture.
Payment of the principal of and premium, if any, on this
Security and interest hereon at Maturity shall be made upon
presentation of this Security at the Corporate Trust Office of
The Chase Manhattan Bank in New York, New York, or at such other
office or agency as may be designated for such purpose by the
Company from time to time. Payment of interest on this Security
(other than interest at Maturity) shall be made by check mailed
to the address of the Person entitled thereto as such address
shall appear in the Security Register, except that (a) if such
Person shall be a securities depositary, such payment may be made
by such other means in lieu of check, as shall be agreed upon by
the Company, the Trustee and such Person and (b) upon the written
request of a Holder of not less than $10 million in aggregate
principal amount of Securities (as hereinafter defined) of the
same series and Tranche delivered to the Company and the Paying
Agent at least ten days prior to any Interest Payment Date,
payment of interest on such Securities to such Holder on such
Interest Payment Date shall be made by wire transfer of immediately
available funds to an account maintained within the continental
United States specified by such Holder or, if such Holder
maintains an account with the entity acting as Paying Agent, by
deposit into such account. Payment of the principal of and
premium, if any, and interest on this Security, as aforesaid,
shall be made in such coin or currency of the United States of
America as at the time of payment shall be legal tender for the
payment of public and private debts.
This Security is one of a duly authorized issue of
securities of the Company (herein called the "Securities"),
issued and issuable in one or more series under and equally
secured by an Indenture, dated as of , 1998 (such
----------- --
Indenture as originally executed and delivered and as
supplemented or amended from time to time thereafter, together
with any constituent instruments establishing the terms of
particular Securities, being herein called the "Indenture"),
between the Company and The Chase Manhattan Bank, trustee (herein
called the "Trustee," which term includes any successor trustee
under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a description
of the respective rights, limitations of rights, duties and
immunities of the Company, the Trustee and the Holders of the
Securities thereunder and of the terms and conditions upon which
the Securities are, and are to be, authenticated and delivered
and secured. The acceptance of this Security shall be deemed to
constitute the consent and agreement by the Holder hereof to all
of the terms and provisions of the Indenture. This Security is
one of the series designated above.
If any Interest Payment Date, any Redemption Date or the
Stated Maturity shall not be a Business Day (as hereinafter
defined), payment of the amounts due on this Security on such
date may be made on the next succeeding Business Day; and, if
such payment is made or duly provided for on such Business Day,
no interest shall accrue on such amounts for the period from and
after such Interest Payment Date, Redemption Date or Stated
Maturity, as the case may be, to such Business Day.
If, as specified above, this Security is redeemable, this
Security is subject to redemption at any time on or after the
Initial Redemption Date specified above, as a whole or in part,
at the election of the Company, at the applicable redemption
price (as described below) plus accrued interest to the date
fixed for redemption. Such redemption price shall be the Initial
Redemption Price specified above for the twelve-month period
commencing on the Initial Redemption Date and shall decline for
the twelve-month period commencing on each anniversary of the
Initial Redemption Date by a percentage of principal amount equal
to the Reduction Percentage specified above until such redemption
price is 100% of the principal amount of this Security to be
redeemed.
Notwithstanding the foregoing, the Company may not, prior to
the Redemption Limitation Date, if any, specified above, redeem
this Security as contemplated above as a part of, or in
anticipation of, any refunding operation by the application,
directly or indirectly, of moneys borrowed having an effective
interest cost to the Company (calculated in accordance with
generally accepted financial practice) less than the effective
interest cost to the Company (similarly calculated) of this
Security.
[Insert provisions, if any, for redemption pursuant to a
sinking fund or analogous provision or at the option of the
Holder.]
Notice of redemption [(other than at the election of the
Holder)] shall be given by mail to Holders of Securities, not
less than 30 days nor more than 60 days prior to the date fixed
for redemption, all as provided in the Indenture. As provided in
the Indenture, notice of redemption at the election of the
Company as aforesaid may state that such redemption shall be
conditional upon the receipt by the Trustee of money sufficient
to pay the principal of and premium, if any, and interest, if
any, on this Security on or prior to the date fixed for such
redemption; a notice of redemption so conditioned shall be of no
force or effect if such money is not so received and, in such
event, the Company shall not be required to redeem this Security.
In the event of redemption of this Security in part only, a
new Security or Securities of this series, of like tenor, for the
unredeemed portion hereof will be issued in the name of the
Holder hereof upon the cancellation hereof.
If an Event of Default shall occur and be continuing, the
principal of this Security may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the Trustee to enter into one or more supplemental
indentures for the purpose of adding any provisions to, or
changing in any manner or eliminating any of the provisions of,
the Indenture with the consent of the Holders of not less than a
majority in aggregate principal amount of the Securities of all
series then Outstanding under the Indenture, considered as one
class; provided, however, that if there shall be Securities of
more than one series Outstanding under the Indenture and if a
proposed supplemental indenture shall directly affect the rights
of the Holders of Securities of one or more, but less than all,
of such series, then the consent only of the Holders of a
majority in aggregate principal amount of the Outstanding
Securities of all series so directly affected, considered as one
class, shall be required; and provided, further, that if the
Securities of any series shall have been issued in more than one
Tranche and if the proposed supplemental indenture shall directly
affect the rights of the Holders of Securities of one or more,
but less than all, of such Tranches, then the consent only of the
Holders of a majority in aggregate principal amount of the
Outstanding Securities of all Tranches so directly affected,
considered as one class, shall be required; and provided,
further, that the Indenture permits the Trustee to enter into one
or more supplemental indentures for limited purposes without the
consent of any Holders of Securities. The Indenture also
contains provisions permitting the Holders of a majority in
principal amount of the Securities then Outstanding, on behalf of
the Holders of all Securities, to waive compliance by the Company
with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be
conclusive and binding upon such Holder and upon all future
Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange therefor or in
lieu hereof, whether or not notation of such consent or waiver is
made upon this Security.
As provided in the Indenture and subject to certain
limitations therein set forth, this Security or any portion of
the principal amount hereof will be deemed to have been paid for
all purposes of the Indenture and to be no longer Outstanding
thereunder, and, at the election of the Company, the Company's
entire indebtedness in respect thereof will be satisfied and
discharged, if there has been irrevocably deposited with the
Trustee or any Paying Agent (other than the Company), in trust,
money in an amount which will be sufficient and/or Eligible
Obligations, the principal of and interest on which when due,
without regard to any reinvestment thereof, will provide moneys
which, together with moneys so deposited, will be sufficient to
pay when due the principal of and interest on this Security when
due.
The Indenture contains terms, provisions and conditions
relating to the consolidation or merger of the Company with or
into, and the conveyance or other transfer, or lease, of assets
to, another Person, to the assumption by such other Person, in
certain circumstances, of all of the obligations of the Company
under the Indenture and on the Securities and to the release and
discharge of the Company, in certain circumstances, from such
obligation.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is
registrable in the Security Register, upon surrender of this
Security for registration of transfer at the corporate trust
office of The Chase Manhattan Bank in New York, New York or such
other office or agency as may be designated by the Company from
time to time, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and
the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more
new Securities of this series of authorized denominations and of
like tenor and aggregate principal amount, will be issued to the
designated transferee or transferees.
The Securities of this series are issuable only as
registered Securities, without coupons, and in denominations of
$1,000 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations therein set forth,
Securities of this series are exchangeable for a like aggregate
principal amount of Securities of the same series and Tranche, of
any authorized denominations, as requested by the Holder
surrendering the same, and of like tenor upon surrender of the
Security or Securities to be exchanged at the corporate trust
office of The Chase Manhattan Bank in New York, New York or such
other office or agency as may be designated by the Company from
time to time.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Prior to due surrender of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name this Security
is registered as the absolute owner hereof for all purposes
(subject to Section 307 of the Indenture), whether or not this
Security be overdue, and neither the Company, the Trustee nor any
such agent shall be affected by notice to the contrary.
The Indenture and the Securities shall be governed by and
construed in accordance with the laws of the State of New York,
except to the extent that the Trust Indenture Act shall be
applicable .
As used herein, "Business Day" means any day, other than a
Saturday or Sunday, which is not a day on which banking
institutions or trust companies in The City of New York, New York
or other city in which is located any office or agency maintained
for the payment of principal, premium, if any, or interest on
this Security, are authorized or required by law, regulation or
executive order to remain closed. All other terms used in this
Security which are defined in the Indenture shall have the
meanings assigned to them in the Indenture.
As provided in the Indenture, no recourse shall be had for
the payment of the principal of or premium, if any, or interest
on any Securities, or any part thereof, or for any claim based
thereon or otherwise in respect thereof, or of the indebtedness
represented thereby, or upon any obligation, covenant or
agreement under the Indenture, against, and no personal liability
whatsoever shall attach to, or be incurred by, any incorporator,
shareholder, officer or director, as such, past, present or
future of the Company or of any predecessor or successor
corporation (either directly or through the Company or a
predecessor or successor corporation), whether by virtue of any
constitutional provision, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise; it being
expressly agreed and understood that the Indenture and all the
Securities are solely corporate obligations and that any such
personal liability is hereby expressly waived and released as a
condition of, and as part of the consideration for, the execution
of the Indenture and the issuance of the Securities.
Unless the certificate of authentication hereon has been
executed by the Trustee or an Authenticating Agent by manual
signature, this Security shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument
to be duly executed.
THE WASHINGTON WATER POWER COMPANY
By:
--------------------------------
[Title]
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated
therein referred to in the within-mentioned Indenture.
Dated:
-------------------
OR
--------------------------- -------------------
, ,
--------------------------- -------------------
AS TRUSTEE AS TRUSTEE
By: BY:[ ],
---------------------------
Authorized Officer AS AUTHENTICATING AGENT
By:
---------------------
Authorized Officer
This Security may not be transferred or exchanged, nor may
any purported transfer be registered, except (i) this Security
may be transferred in whole, and appropriate registration of
transfer effected, if such transfer is by Cede & Co., as nominee
for The Depository Trust Company (the "Depositary"), to the
Depositary, or by the Depositary to another nominee thereof, or
by any nominee of the Depositary to any other nominee thereof, or
by the Depositary or any nominee thereof to any successor
securities depositary or any nominee thereof; and (ii) this
Security may be exchanged for definitive Securities registered in
the respective names of the beneficial holders hereof, and
thereafter shall be transferable without restrictions if: (A) the
Depositary, or any successor securities depositary, shall have
notified the Company and the Trustee that it is unwilling or
unable to continue to act as securities depositary with respect
to the Securities and the Trustee shall not have been notified by
the Company within ninety (90) days of the identity of a
successor securities depositary with respect to the Securities;
(B) the Company shall have delivered to the Trustee a Company
Order to the effect that the Securities shall be so exchangeable
on and after a date specified therein; or (C)(1) an Event of
Default shall have occurred and be continuing, (2) the Trustee
shall have given notice of such Event of Default pursuant to
Section 802 of the Indenture and (3) there shall have been
delivered to the Company and the Trustee an Opinion of Counsel to
the effect that the interests of the beneficial owners of the
Securities in respect thereof will be materially impaired unless
such owners become Holders of definitive Securities.
------------------
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto
-----------------------------------------------------------------
[please insert social security or other identifying number of
assignee]
-----------------------------------------------------------------
[please print or typewrite name and address of assignee]
-----------------------------------------------------------------
the within Security of THE WASHINGTON WATER POWER COMPANY and
does hereby irrevocably constitute and appoint ,
-------------
Attorney, to transfer said Security on the books of the
within-mentioned Company, with full power of substitution in the
premises.
Dated:
--------------
-------------------------------------
Notice: The signature to this assignment must correspond with
the name as written upon the face of the Security in every
particular without alteration or enlargement or any change
whatsoever.
FORM OF FLOATING RATE NOTE
(See legend at the end of this Security for
restrictions on transfer and change of form)
THE WASHINGTON WATER POWER COMPANY
Medium-Term Notes, Series C
ORIGINAL INTEREST ACCRUAL DATE: MAXIMUM INTEREST RATE:
STATED MATURITY: MINIMUM INTEREST RATE:
INITIAL INTEREST RATE: INTEREST PAYMENT PERIOD:
BASE RATE: INTEREST PAYMENT DATES:
-- CD RATE REGULAR RECORD DATES:
-- CMT RATE INTEREST RESET PERIOD:
DESIGNATED CMT MATURITY INDEX: INTEREST RESET DATES:
DESIGNATED CMT TELERATE PAGE: RATE DETERMINATION DATES:
-- COMMERCIAL PAPER RATE INDEX MATURITY:
-- FEDERAL FUNDS RATE SPREAD: (+ BASIS PTS.)
-
-- LIBOR
REPORTING SERVICE: REDEEMABLE: YES NO
-- --
-- LIBOR REUTERS INITIAL REDEMPTION DATE:
-- LIBOR TELERATE INITIAL REDEMPTION PRICE:
INDEX CURRENCY: REDUCTION PERCENTAGE:
-- PRIME RATE REDEMPTION LIMITATION
DATE:
-- TREASURY RATE OTHER PROVISIONS:
OID: YES NO
-- --
TOTAL AMOUNT OF OID (%):
YIELD TO MATURITY (%):
INITIAL ACCRUAL
PERIOD OID (%):
(CONSTANT - YIELD METHOD)
---------------------------
This Security is not a Discount Security
within the meaning of the within-mentioned Indenture.
---------------------------
Principal Amount Registered No.
$ CUSIP
THE WASHINGTON WATER POWER COMPANY, a corporation organized
and existing under the laws of the State of Washington (herein
called the "Company," which term includes any successor
corporation under the Indenture referred to below), for value
received, hereby promises to pay to
or registered assigns, the principal sum of
DOLLARS
on the Stated Maturity specified above, and to pay interest
thereon from the Original Interest Accrual Date specified above
or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, quarterly, semi-annually or
annually, as specified above for the Interest Payment Period, in
arrears on the Interest Payment Dates specified above in each
year, commencing with the Interest Payment Date next succeeding
the Original Interest Accrual Date specified above, and at
Maturity, until the principal hereof is paid or duly provided
for. Except as otherwise provided herein, the rate of interest
to be so paid shall be the Initial Interest Rate specified above
until the first Interest Reset Date specified above following the
Original Interest Accrual Date and thereafter a rate determined,
in accordance with the provisions hereinafter set forth, by
reference to the Base Rate specified above plus or minus the
Spread, if any, specified above or multiplied by the Spread
Multiplier, if any, specified above. The interest so payable,
and paid or duly provided for, on any Interest Payment Date
shall, as provided in such Indenture, be paid to the Person in
whose name this Security (or one or more Predecessor Securities)
is registered at the close of business on the Regular Record Date
specified above (whether or not a Business Day) next preceding
such Interest Payment Date. Notwithstanding the foregoing, (a)
if the Original Interest Accrual Date of this Security is after a
Regular Record Date and before the corresponding Interest Payment
Date, interest so payable for the period from and including the
Original Interest Accrual Date to but excluding such Interest
Payment Date shall be paid on the next succeeding Interest
Payment Date to the Holder hereof on the related Regular Record
Date; and (b) interest payable at Maturity shall be paid to the
Person to whom principal shall be paid. Except as otherwise
provided in said Indenture, any such interest not so paid or duly
provided for shall forthwith cease to be payable to the Holder on
such Regular Record Date and may either be paid to the Person in
whose name this Security (or one or more Predecessor Securities)
is registered at the close of business on a Special Record Date
for the payment of such Unpaid Interest to be fixed by the
Trustee, notice of which shall be given to Holders of Securities
of this series not less than 15 days prior to such Special Record
Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on
which the Securities of this series may be listed, and upon such
notice as may be required by such exchange, all as more fully
provided in said Indenture.
Payment of the principal of and premium, if any, on this
Security and interest hereon at Maturity shall be made upon
presentation of this Security at the Corporate Trust Office of
The Chase Manhattan Bank in New York, New York or at such other
office or agency as may be designated for such purpose by the
Company from time to time. Payment of interest on this Security
(other than interest at Maturity) shall be made by check mailed
to the address of the Person entitled thereto as such address
shall appear in the Security Register, except that (a) if such
Person shall be a securities depositary, such payment may be made
by such other means in lieu of check, as shall be agreed upon by
the Company, the Trustee and such Person and (b) upon the written
request of a Holder of not less than $10 million in aggregate
principal amount of Securities (as hereinafter defined) of the
same series and Tranche delivered to the Company and the Paying
Agent at least ten days prior to any Interest Payment Date,
payment of interest on such Securities to such Holder on such
Interest Payment Date shall be made by wire transfer of immediately
available funds to an account maintained within the continental
United States specified by such Holder or, if such Holder
maintains an account with the entity acting as Paying Agent, by
deposit into such account. Payment of the principal of and
premium, if any, and interest on this Security, as aforesaid,
shall be made in such coin or currency of the United States of
America as at the time of payment shall be legal tender for the
payment of public and private debts.
This Security is one of a duly authorized issue of
securities of the Company (herein called the "Securities"),
issued and issuable in one or more series under and equally
secured by an Indenture, dated as of , 1998 (such
-----------
Indenture as originally executed and delivered and as
supplemented or amended from time to time thereafter, together
with any constituent instruments establishing the terms of
particular Securities, being herein called the "Indenture"),
between the Company and The Chase Manhattan Bank, trustee (herein
called the "Trustee," which term includes any successor trustee
under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a description
of the respective rights, limitations of rights, duties and
immunities of the Company, the Trustee and the Holders of the
Securities thereunder and of the terms and conditions upon which
the Securities are, and are to be, authenticated and delivered
and secured. The acceptance of this Security shall be deemed to
constitute the consent and agreement by the Holder hereof to all
terms and provisions of the Indenture. This Security is one of
the series designated above.
Interest payments on this Security shall be the amount of
interest accrued from and including the last date to which
interest has been paid or duly provided for, or, if no interest
has been paid or duly provided for, from and including the
Original Interest Accrual Date, to but excluding the next
succeeding Interest Payment Date; provided, however, that if the
interest rate on this Security is reset daily or weekly as
specified on the face hereof for the Interest Reset Period,
interest payments shall be the amount of interest accrued from
and including the most recent date to which interest has been
paid or duly provided for, or, if no interest has been paid, from
the Original Interest Accrual Date, to, but excluding, the
Regular Record Date next preceding such Interest Payment Date,
except that at Maturity the interest payable shall include
interest accrued to but excluding the date of Maturity.
Accrued interest on this Security shall be calculated by
multiplying the principal amount of this Security by an accrued
interest factor. Such accrued interest factor shall be computed
by adding the interest factors calculated for each day in the
Interest Payment Period for which accrued interest is being
calculated. The interest factor (expressed as a decimal
calculated to seven decimal places without rounding) for each
such day shall be computed by dividing the interest rate
applicable to such day by 360 if the Base Rate is the CD Rate,
the Commercial Paper Rate, the Federal Funds Rate, LIBOR or the
Prime Rate, as indicated above, or by the actual number of days
in the year if the Base Rate is the CMT Rate or the Treasury
Rate, as indicated above. For purposes of making the foregoing
calculation, the interest rate in effect on any Interest Reset
Date shall be the applicable rate as reset on such date. Unless
otherwise specified above, all percentages resulting from any
calculation of the rate of interest hereon shall be rounded, if
necessary, to the nearest 1/100,000 of 1% (.0000001), with five
one-millionths of a percentage point rounded upward, and all
dollar amounts used in or resulting from such calculation shall
be rounded to the nearest one-hundredth cent (with .005 of a cent
being rounded upward).
Except as otherwise provided herein, commencing with the
first Interest Reset Date specified above following the Original
Interest Accrual Date and thereafter upon each succeeding
Interest Reset Date specified above, the rate at which interest
on this Security is payable shall be reset daily, weekly,
monthly, quarterly, semi-annually or annually as specified above
for the Interest Reset Period, and such rate, as so reset, shall
be effective as of and for the related Interest Reset Date and
for the balance of the related Interest Reset Period to but
excluding the next succeeding Interest Reset Date. Unless
otherwise specified above, the Interest Reset Dates shall be, if
the interest rate on this Security resets daily, each Business
Day; if the interest rate on this Security (unless the Base Rate
is the Treasury Rate) resets weekly, Wednesday of each week; if
the Base Rate specified above is the Treasury Rate and resets
weekly, Tuesday of each week (except as provided below under
"Determination of Treasury Rate"); if the interest rate on this
Security resets monthly, the third Wednesday of each month; if
the interest rate on this Security resets quarterly, the third
Wednesday of March, June, September and December of each year; if
the interest rate on this Security resets semi-annually, the
third Wednesday of the two months of each year specified above;
and if the interest rate on this Security resets annually, the
third Wednesday of the month of each year specified above;
provided, however, that the interest rate in effect for the ten
days immediately prior to Maturity will be that in effect on the
tenth day preceding Maturity. If an Interest Reset Date for this
Security would otherwise be a day that is not a Business Day (as
hereinafter defined), such Interest Reset Date shall be postponed
to the next succeeding Business Day, except that, if the Base
Rate specified on the face hereof is LIBOR and such Business Day
is in the next succeeding calendar month, such Interest Reset
Date shall be the immediately preceding Business Day.
Anything herein to the contrary notwithstanding, the
interest rate hereon shall not be greater than the Maximum
Interest Rate, if any, or less than the Minimum Interest Rate, if
any, specified above. In addition, the interest rate hereon
shall in no event be higher than the maximum rate permitted by
New York law as the same may be modified by United States law of
general application.
Unless otherwise specified above, interest will be payable,
if the interest rate on this Security resets daily, weekly or
monthly, on the third Wednesday of each month or on the third
Wednesday of March, June, September and December of each year, as
specified above; if the interest rate on this Security resets
quarterly, on the third Wednesday of March, June, September and
December of each year; if the interest rate on this Security
resets semi-annually, on the third Wednesday of the two months of
each year specified above; and if the interest rate on this
Security resets annually, on the third Wednesday of the month of
each year specified above (each such day being an "Interest
Payment Date").
If any Interest Payment Date other than a Redemption Date or
the Stated Maturity would otherwise be a day that is not a
Business Day, such Interest Payment Date shall be postponed to
the next succeeding Business Day, except that, if the Base Rate
specified above is LIBOR and such next succeeding Business Day is
in the next succeeding calendar month, such Interest Payment Date
shall be the next preceding Business Day. If a Redemption Date
or the Stated Maturity shall not be a Business Day, payment of
the amounts due on this Security on such date in respect of
principal, premium, if any, and/or interest may be made on the
next succeeding Business Day; and if payment is made or duly
provided for on such Business Day, no interest shall accrue on
such amounts for the period from and after such Redemption Date
or Stated Maturity, as the case may be, to such Business Day.
The Company will appoint, and enter into an agreement with,
an agent (the "Calculation Agent") to calculate the interest
rates on floating rate Securities (including this Security).
Unless otherwise specified above, The Chase Manhattan Bank shall
be the Calculation Agent. All determinations of interest rates
by the Calculation Agent shall, in the absence of manifest error,
be conclusive for all purposes and binding on the Holder hereof.
Subject to applicable provisions of law and except as
otherwise specified herein, on each Interest Reset Date the rate
of interest shall be determined in accordance with the provisions
of the applicable heading below.
Determination of CD Rate
If the Base Rate specified above is the CD Rate, this
Security shall bear interest for each Interest Reset Period at
an interest rate calculated with reference to the CD Rate,
determined as set forth below, and the Spread or Spread
Multiplier, if any, and subject to the Maximum Interest Rate,
if any, and the Minimum Interest Rate, if any, specified above.
The "CD Rate" for each Interest Reset Period shall be
determined by the Calculation Agent on the Calculation Date (as
hereinafter defined) and shall be (a) the rate (expressed as a
percentage per annum) as of the second Business Day prior to the
related Interest Reset Date (a "CD Rate Determination Date") for
negotiable certificates of deposit having the Index Maturity
specified above as published in H.15(519) under the heading "CDs
(Secondary Market)", or (b) if such rate is not so published by
9:00 A.M., New York City time, on the Calculation Date, the rate
as of such CD Rate Determination Date for negotiable
certificates of deposit of the Index Maturity specified above as
published in Composite Quotations (as hereinafter defined), or
(c) if neither of such rates is published by 3:00 P.M., New York
City time, on the Calculation Date, the arithmetic mean of the
secondary market offered rates as of 10:00 A.M., New York City
time, on such CD Rate Determination Date for certificates of
deposit in an amount that is representative of a single
transaction at that time with a remaining maturity closest to the
Index Maturity specified above of three leading nonbank dealers
in negotiable U.S. dollar certificates of deposit in The City of
New York selected by the Calculation Agent, in its discretion
(after consultation with the Company); provided, however, that if
the dealers selected as aforesaid by the Calculation Agent are
not quoting as described in clause (c) above, the CD Rate for
such Interest Reset Period shall be the same as the CD Rate for
the immediately preceding Interest Reset Period (or, if there was
no such previous Interest Reset Period, the rate of interest
hereon for such Interest Reset Period shall be the Initial
Interest Rate).
Determination of CMT Rate
If the Base Rate specified above is the CMT Rate, this
Security shall bear interest for each Interest Reset Period at
a rate calculated with reference to the CMT Rate, determined as
set forth below, and the Spread or Spread Multiplier, if any,
and subject to the Maximum Interest Rate, if any, and the
Minimum Interest Rate, if any, specified above.
The "CMT Rate" for each Interest Reset Period shall be
determined by the Calculation Agent on the Calculation Date and
shall be the rate (expressed as a percentage per annum) displayed
on the Designated CMT Telerate Page (as defined below) under the
caption "...Treasury Constant Maturities... Federal Reserve Board
Release H.15...Mondays Approximately 3:45 p.m." under the column
for the Designated CMT Maturity Index (as defined below) for
(a)(i) if the Designated CMT Telerate Page is 7055, the second
Business Day prior to the related Interest Reset Date (a "CMT
Rate Determination Date") or (ii) if the Designated CMT Telerate
Page is 7052, the week or the month, as applicable, ended
immediately preceding the week in which such CMT Rate
Determination Date occurs, or (b) if such rate is no longer
displayed on the relevant page, or if not displayed by 3:00 p.m.,
New York City time on the Calculation Date, the Treasury Constant
Maturity rate for the Designated CMT Maturity Index as published
in H.15(519), or (c) if such rate is no longer published or, if
not published by 3:00 p.m., New York City time, on the
Calculation Date, the Treasury Constant Maturity rate for the
Designated CMT Maturity Index (or other United States Treasury
rate for the Designated CMT Maturity Index) for such CMT Rate
Determination Date as may then be published by either the Board
of Governors of the Federal Reserve System or the United States
Department of the Treasury that the Calculation Agent determines
to be comparable to the rate formerly displayed on the Designated
CMT Telerate Page and published in H.15(519), or (d) if such
information is not provided by 3:00 p.m., New York City time, on
the Calculation Date, then the CMT Rate for the CMT Rate
Determination Date shall be a yield to maturity, based on the
arithmetic mean of the secondary market closing offer side prices
as of approximately 3:30 p.m., New York City time, on the CMT
Rate Determination Date reported, according to their written
records, by three leading primary United States government
securities dealers (each, a "Reference Dealer") in The City of
New York selected by the Calculation Agent (from five such
Reference Dealers selected by the Calculation Agent, in its
discretion (after consultation with the Company), and eliminating
the highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality,
one of the lowest)), for the most recently issued direct
noncallable fixed rate obligations of the United States
("Treasury notes") with an original maturity of approximately the
Designated CMT Maturity Index and a remaining term to maturity of
not less than such Designated CMT Maturity Index minus one year,
or (e) if the Calculation Agent cannot obtain three such Treasury
notes quotations, a yield to maturity based on the arithmetic
mean of the secondary market offer side prices as of
approximately 3:30 p.m., New York City time, on the CMT Rate
Determination Date of three Reference Dealers in The City of New
York (from five such Reference Dealers selected by the
Calculation Agent, in its discretion (after consultation with the
Company), and eliminating the highest quotation (or, in the event
of equality, one of the highest) and the lowest quotation (or, in
the event of equality, one of the lowest)), for Treasury notes
with an original maturity of the number of years that is the next
highest to the Designated CMT Maturity Index and a remaining term
to maturity closest to the Designated CMT Maturity Index and in
an amount of at least $100 million, or (f) if three or four (and
not five) of such Reference dealers are quoting as described
above, the arithmetic mean of the offer prices obtained without
the elimination of either the highest or the lowest of such
quotes; provided, however, that if fewer than three Reference
Dealers selected by the Calculation Agent are quoting as
described above, the CMT Rate for such Interest Reset Period will
be the same as the CMT Rate for the immediately preceding
Interest Reset Period (or, if there was no such previous Interest
Reset Period, the rate of interest hereon for such Interest Reset
Period shall be the Initial Interest Rate). For purposes of
clause (e) in the first sentence of this paragraph, if two
Treasury notes have remaining terms to maturity equally close to
the Designated CMT Maturity Index, the quotes for the Treasury
note with the shorter remaining term to maturity shall be used.
"Designated CMT Maturity Index" shall be the original period
to maturity of the U.S. Treasury securities (either 1, 2, 3, 5,
7, 10, 20 or 30 years) specified above with respect to which the
CMT Rate will be calculated. If no such maturity is specified
above, the Designated CMT Maturity Index shall be 2 years.
"Designated CMT Telerate Page" means the display on the Dow
Jones Market service (formerly known as the Dow Jones Telerate
Service) on the page specified above (or any other page as may
replace such page on that service, or any successor service, for
the purpose of displaying Treasury Constant Maturities as
reported in H.15(519)), for the purpose of displaying Treasury
Constant Maturities as reported in H.15(519). If no such page is
specified above, the page shall be 7052, for the most recent
week.
Determination of Commercial Paper Rate
If the Base Rate specified above is the Commercial Paper Rate,
this Security shall bear interest for each Interest Reset Period
at a rate calculated with reference to the Commercial Paper Rate,
determined as set forth below, and the Spread or Spread Multiplier,
if any, and subject to the Maximum Interest Rate, if any, and the
Minimum Interest Rate, if any, specified above.
The "Commercial Paper Rate" for each Interest Reset Period
shall be determined by the Calculation Agent on the Calculation
Date and shall be (a) the Money Market Yield (as hereinafter
defined) as of the second Business Day prior to the related
Interest Reset Date (a "Commercial Paper Rate Determination
Date") of the rate (expressed as a percentage per annum) for
commercial paper having the Index Maturity specified above, as
such rate shall be published in H.15(519) (as hereinafter
defined) under the heading "Commercial Paper - Nonfinancial", or
(b) if such rate is not so published prior to 9:00 a.m., New York
City time, on the Calculation Date, the Money Market Yield as of
such Commercial Paper Rate Determination Date of the rate for
commercial paper of the Index Maturity as published in Composite
Quotations (as hereinafter defined) under the heading "Commercial
Paper", or (c) if none of such rates is published by 3:00 p.m.,
New York City time, on the Calculation Date, the Money Market
Yield of the arithmetic mean of the offered rates, as of 11:00
a.m., New York City time, on such Commercial Paper Rate
Determination Date, of three leading dealers in commercial paper
in The City of New York selected by the Calculation Agent, in its
discretion (after consultation with the Company), for commercial
paper of the Index Maturity placed for a nonfinancial issuer
whose bond rating is "AA," or the equivalent, from a nationally
recognized statistical rating organization; provided, however,
that if the dealers selected as aforesaid are not quoting offered
rates as described in clause (c) above, the Commercial Paper Rate
for such Interest Reset Period shall be deemed to be the same as
the Commercial Paper Rate for the preceding Interest Reset Period
(or, if there was no such previous Interest Reset Period, the
rate of interest hereon for such Interest Reset Period shall be
the Initial Interest Rate).
"Money Market Yield" shall be a yield calculated in
accordance with the following formula:
Money Market Yield = D x 360 x 100
---------------
360 - (D x M)
where "D" refers to the applicable per annum rate for commercial
paper quoted on a bank discount basis and expressed as a decimal,
and "M" refers to the actual number of days in the Index Maturity
specified above.
Determination of Federal Funds Rate
If the Base Rate specified above is the Federal Funds Rate,
this Security shall bear interest for each Interest Reset Period
at a rate calculated with reference to the Federal Funds Rate,
determined as set forth below, and the Spread or Spread Multiplier,
if any, and subject the Maximum Interest Rate, if any, and the
Minimum Interest Rate, if any, specified above.
The "Federal Funds Rate" for each Interest Reset Period
shall be determined by the Calculation Agent on the Calculation
Date and shall be (a) the rate (expressed as a percentage per
annum) as of the second Business Day prior to the related
Interest Reset Date (a "Federal Funds Rate Determination Date")
for Federal funds as published in H.15(519) under the heading
"Federal Funds (Effective)", or (b) if such rate is not so
published by 9:00 A.M., New York City time, on the Calculation
Date, the rate on such Federal Funds Rate Determination Date as
published in Composite Quotations under the heading "Federal
Funds/Effective Rate", or (c) if neither of such rates is
published by 3:00 P.M., New York City time, on the Calculation
Date, the arithmetic mean of the rates for the last transaction
in overnight Federal funds as of 11:00 A.M., New York City time,
on such Federal Funds Rate Determination Date arranged by three
leading brokers in Federal Funds transactions in The City of New
York selected by the Calculation Agent, in its discretion (after
consultation with the Company); provided, however, that if the
brokers selected as aforesaid by the Calculation Agent are not
quoting as described in clause (c) above, the Federal Funds Rate
for such Interest Reset Period shall be the same as the Federal
Funds Rate for the immediately preceding Interest Reset Period
(or, if there was no such previous Interest Reset Period, the
rate of interest hereon for such Interest Reset Period shall be
the Initial Interest Rate).
Determination of LIBOR
If the Base Rate specified above is LIBOR, this Security
shall bear interest for each Interest Reset Period at a rate
calculated with reference to LIBOR, determined as set forth
below, and the Spread or Spread Multiplier, if any, and subject
to the Maximum Interest Rate, if any, and the Minimum Interest
Rate, if any, specified above.
"LIBOR" for each Interest Reset Period shall be determined
by the Calculation Agent and shall be:
(a)(i) if "LIBOR Reuters" is specified above as the
Reporting Service, the arithmetic mean of the offered rates
(unless the specified Designated LIBOR Page (as hereinafter
defined) by its terms provides only for a single rate, in
which case such single rate shall be used) for deposits in
the Index Currency specified above in the London interbank
market, for the period of the Index Maturity specified above
commencing on the related Interest Reset Date for such
Interest Reset Period, which appear or appears on the
Designated LIBOR Page at approximately 11:00 a.m., London
time, on the second London Banking Day (as hereinafter
defined) prior to such Interest Reset Date (a "LIBOR
Determination Date"), or (ii) if "LIBOR Telerate" is
specified above as the Reporting Service, the rate for
deposits in the Index Currency, for the period of the Index
Maturity commencing on such Interest Reset Date (or, if the
pound sterling is the Index Currency, commencing on the
LIBOR Determination Date) that appears on the Designated
LIBOR Page at approximately 11:00 a.m., London time, on such
LIBOR Determination Date;
(b) with respect to a LIBOR Determination Date on
which fewer than two offered rates appear (if "LIBOR
Reuters" is specified above as the Reporting Service and
calculation of LIBOR is based on the arithmetic mean of the
offered rates) or on which no rate appears (if the Reporting
Service specified above is either (x) "LIBOR Reuters" and
the Designated LIBOR Page by its terms provides only for a
single rate or (y) "LIBOR Telerate"), the Calculation Agent
shall request the principal London office of each of four
major reference banks in the London interbank market
selected by the Calculation Agent, in its discretion (after
consultation with the Company), to provide the Calculation
Agent with its offered quotations for deposits in the Index
Currency, for the period of the Index Maturity commencing on
the Interest Reset Date (or, if the pound sterling is the
Index Currency, commencing on the LIBOR Determination Date)
for such Interest Reset Period and in a principal amount
equal to an amount of not less than U.S.$1 million (or the
equivalent amount in the Index Currency) that is
representative of a single transaction in the Index Currency
in such market at such time, to prime banks in the London
interbank market at approximately 11:00 a.m., London time,
on such LIBOR Determination Date; if at least two such
quotations are provided, LIBOR, in respect of such LIBOR
Determination Date, shall be the arithmetic mean of such
quotations;
(c) if fewer than two such quotations are so provided,
LIBOR in respect of such LIBOR Determination Date shall be
the arithmetic mean of the rates quoted by three major banks
in the applicable Principal Financial Center for the country
of the Index Currency on such LIBOR Determination Date
selected by the Calculation Agent, in its discretion (after
consultation with the Company), at approximately 11:00 a.m.
on such LIBOR Determination Date, for loans in the Index
Currency to leading European banks, for the period of the
Index Maturity commencing on the Interest Reset Date (or, if
the pound sterling is the Index Currency, commencing on the
LIBOR Determination Date) for such Interest Reset Period and
in a principal amount of not less than U.S.$1 million (or
the equivalent amount in the Index Currency) that is
representative of a single transaction in the Index Currency
in such market at such time; provided, however, that if
fewer than three banks selected as aforesaid by the
Calculation Agent are quoting rates described in this
clause (c), LIBOR for such Interest Reset Period shall be
the same as LIBOR for the immediately preceding Interest
Reset Period (or, if there was no such previous Interest
Reset Period, the rate of interest hereon for such Interest
Reset Period shall be the Initial Interest Rate).
"Designated LIBOR Page" means (x) if "LIBOR Reuters" is
specified above as the Reporting Service, the display on the
Reuters monitor money rates service (or any successor service)
for the purpose of displaying the London interbank rates of major
banks for the applicable Index Currency, or (y) if "LIBOR
Telerate" is specified above as the Reporting Service, the
display on the Dow Jones Market service (formerly known as the
Dow Jones Telerate Service), or any successor service, for the
purpose of displaying the London interbank rates of major banks
for the Index Currency. If neither LIBOR Reuters nor LIBOR
Telerate is specified above as the Reporting Service, LIBOR shall
be determined as if LIBOR Telerate Page 3750 had been specified.
"Index Currency" means the currency (including any composite
currency) so specified above. If no such currency is so
specified above, "Index Currency" means U.S. dollars.
"LIBOR Telerate Page 3750" means the display designated as
"Page 3750" on the Dow Jones Market service (formerly known as
the Dow Jones Telerate Service), or such other page as may
replace Page 3750 on such service or such other successor service
or services as may be nominated by the British Bankers'
Association as the information vendor for the purpose of
displaying London interbank offered rates for U.S. dollar
deposits.
"Principal Financial Center" will be, for purposes of clause
(c) above, the principal financial center of the country of the
specified Index Currency, which generally will be the capital
city of such country, except that with respect to U.S. Dollars,
Deutsche Marks and Euros, the Principal Financial Center shall be
the City of New York, Frankfurt or Brussels, as the case may be.
Determination of Prime Rate
If the Base Rate specified above is the Prime Rate, this
Security shall bear interest for each Interest Rest Period at a
rate calculated with reference to the Prime Rate, determined as
set forth below, and the Spread or Spread Multiplier, if any,
and subject to the Maximum Interest Rate, if any, and the Minimum
Interest Rate, if any, specified above.
The "Prime Rate" for each Interest Reset Period shall be
determined by the Calculation Agent on the Calculation Date and
shall be (a) the rate (expressed as a percentage per annum) as of
the second Business Day prior to the related Interest Reset Date
(a "Prime Rate Determination Date") set forth in H.15(519)
opposite the caption "Bank Prime Loan", or (b) if such rate is
not so published prior to 3:00 p.m., New York City time, on the
Calculation Date, the arithmetic mean of the rates publicly
announced by each bank named on the Reuters Screen USPRIME1 Page
(as defined below) as such bank's prime rate or base lending rate
as in effect on such Prime Rate Determination Date as quoted on
the Reuters Screen USPRIME1 Page on such Prime Rate Determination
Date or (c) if fewer than four such rates appear on the Reuters
Screen USPRIME1 Page for such Prime Rate Determination Date, the
arithmetic mean of the prime rates quoted on the basis of the
actual number of days in the year divided by 360 as of the close
of business on such Prime Rate Determination Date by at least two
of three major money center banks in The City of New York
selected by the Calculation Agent, in its discretion (after
consultation with the Company), from which quotations are
requested; provided, however, that if fewer than two such prime
rates are so quoted by major money center banks as aforesaid,
there shall be included in the group of rates whose arithmetic
mean is to be so determined the prime rates or base lending
rates, as of such Prime Rate Determination Date, of that number
of substitute banks or trust companies organized and doing
business under the laws of the United States, or any State
thereof, in each case having total equity capital of at least
U.S. $500 million and being subject to supervision or examination
by Federal or State authority, selected by the Calculation Agent,
in its discretion (after consultation with the Company), which,
when added to the number of rates provided by major money center
banks as aforesaid, shall equal two.
If in any calendar month the Prime Rate is not published in
H.15(519) and the banks or trust companies selected as aforesaid
are not quoting as described in the preceding paragraph, the
"Prime Rate" for the applicable Interest Reset Period shall be
Prime Rate for the immediately preceding Interest Reset Period
(or, if there was no such previous Interest Reset Period, the
rate of interest hereon for such Interest Reset Period shall be
the Initial Interest Rate).
"Reuters Screen USPRIME1 Page" means the display designated
as Page "USPRIME1" on the Reuters monitor money rates service (or
such other page as may replace the USPRIME1 Page on that service
for the purpose of displaying prime rates or base lending rates
of major United States banks).
Determination of Treasury Rate
If the Base Rate specified above is the Treasury Rate, this
Security shall bear interest for each Interest Reset Period at a
rate calculated with reference to the Treasury Rate, determined as
set forth below, and the Spread or Spread Multiplier, if any, and
subject to the Maximum Interest Rate, if any, and the Minimum
Interest Rate, if any, specified above.
The "Treasury Rate" for each Interest Reset Period shall be
determined by the Calculation Agent on the Calculation Date and
shall be (a) the rate (expressed as a percentage per annum) for
the auction held on the Treasury Rate Determination Date (as
hereinafter defined) for such Interest Reset Period of direct
obligations of the United States ("Treasury bills") having the
Index Maturity specified above, as such rate shall be published
in H.15(519) under the heading "U.S. Government Securities -
Treasury bills - auction average (investment)", or (b) if such
rate is not published prior to 9:00 a.m., New York City time, on
the Calculation Date, the auction average rate (expressed as a
bond equivalent on the basis of a year of 365 or 366 days, as
applicable, and applied on a daily basis) on such Treasury Rate
Determination Date as otherwise announced by the United States
Department of Treasury, or (c) if the results of the auction of
Treasury bills having such Index Maturity are not published or
reported as provided above by 3:00 p.m., New York City time, on
the Calculation Date, or if no such auction is held on such
Treasury Rate Determination Date, a yield to maturity (expressed
as a bond equivalent on the basis of a year of 365 or 366 days,
as applicable, and applied on a daily basis) of the arithmetic
mean of the secondary market bid rates, as of approximately 3:30
p.m., New York City time, on such Treasury Rate Determination
Date, of three leading primary United States government
securities dealers selected by the Calculation Agent, in its
discretion (after consultations with the Company), for the issue
of Treasury bills with a remaining maturity closest to such Index
Maturity; provided, however, that if the dealers selected as
aforesaid by the Calculation Agent are not quoting bid rates as
described in clause (c) above, then the "Treasury Rate" for such
Interest Reset Period shall be deemed to be the same as the
Treasury Rate for the immediately preceding Interest Reset Period
(or, if there was no such previous Interest Reset Period, the
rate of interest hereon for such Interest Reset Period shall be
the Initial Interest Rate).
The "Treasury Rate Determination Date" for each Interest
Reset Period shall be the day of the week in which the Interest
Reset Date for such Interest Reset Period falls on which Treasury
bills would normally be auctioned. (As of the Original Interest
Accrual Date, Treasury bills are normally sold at auction on
Monday of each week, unless that day is a legal holiday, in which
case the auction is normally held on the following Tuesday,
except that such auction may be held on the preceding Friday.)
If, as the result of a legal holiday, an auction is so held on
the preceding Friday, such Friday shall be the Treasury Rate
Determination Date pertaining to the Interest Reset Period
commencing in the next succeeding week. If an auction date shall
fall on any day that would otherwise be an Interest Reset Date
for a Treasury Rate Note, then such Interest Reset Date shall
instead be the Business Day immediately following such auction
date.
If, as specified above, this Security is redeemable, this
Security is subject to redemption at any time on or after the
Initial Redemption Date specified above, as a whole or in part,
at the election of the Company, at the applicable redemption
price (as described below) plus accrued interest to the date
fixed for redemption. Such redemption price shall be the Initial
Redemption Price specified above for the twelve-month period
commencing on the Initial Redemption Date and shall decline for
the twelve-month period commencing on each anniversary of the
Initial Redemption Date by a percentage of principal amount equal
to the Reduction Percentage specified above until such redemption
price is 100% of the principal amount of this Security to be
redeemed.
Notwithstanding the foregoing, the Company may not, prior to
the Redemption Limitation Date, if any, specified above, redeem
this Security as contemplated above as a part of, or in
anticipation of, any refunding operation by the application,
directly or indirectly, of moneys borrowed having an effective
interest cost to the Company (calculated in accordance with
generally accepted financial practice) less than the effective
interest cost to the Company (similarly calculated) of this
Security.
[Insert provisions, if any, for redemption pursuant to a
sinking fund or analogous provision or at the option of the
Holder.]
Notice of redemption [(other than at the election of the
Holder)] shall be given by mail to Holders of Securities, not
less than 30 days nor more than 60 days prior to the date fixed
for redemption, all as provided in the Indenture. As provided in
the Indenture, notice of redemption at the election of the
Company as aforesaid may state that such redemption shall be
conditional upon the receipt by the Trustee of money sufficient
to pay the principal of and premium, if any, and interest, if
any, on this Security on or prior to the date fixed for such
redemption; a notice of redemption so conditioned shall be of no
force or effect if such money is not so received and, in such
event, the Company shall not be required to redeem this Security.
In the event of redemption of this Security in part only, a
new Security or Securities of this series, of like tenor, for the
unredeemed portion hereof will be issued in the name of the
Holder hereof upon the cancellation hereof.
If an Event of Default shall occur and be continuing, the
principal of this Security may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the Trustee to enter into one or more supplemental
indentures for the purpose of adding any provisions to, or
changing in any manner or eliminating any of the provisions of,
the Indenture with the consent of the Holders of not less than a
majority in aggregate principal amount of the Securities of all
series then Outstanding under the Indenture, considered as one
class; provided, however, that if there shall be Securities of
more than one series Outstanding under the Indenture and if a
proposed supplemental indenture shall directly affect the rights
of the Holders of Securities of one or more, but less than all,
of such series, then the consent only of the Holders of a
majority in aggregate principal amount of the Outstanding
Securities of all series so directly affected, considered as one
class, shall be required; and provided, further, that if the
Securities of any series shall have been issued in more than one
Tranche and if the proposed supplemental indenture shall directly
affect the rights of the Holders of Securities of one or more,
but less than all, of such Tranches, then the consent only of the
Holders of a majority in aggregate principal amount of the
Outstanding Securities of all Tranches so directly affected,
considered as one class, shall be required; and provided,
further, that the Indenture permits the Trustee to enter into one
or more supplemental indentures for limited purposes without the
consent of any Holders of Securities. The Indenture also
contains provisions permitting the Holders of a majority in
principal amount of the Securities then Outstanding, on behalf of
the Holders of all Securities, to waive compliance by the Company
with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be
conclusive and binding upon such Holder and upon all future
Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange therefor or in
lieu hereof, whether or not notation of such consent or waiver is
made upon this Security.
As provided in the Indenture and subject to certain
limitations therein set forth, this Security or any portion of
the principal amount hereof will be deemed to have been paid for
all purposes of the Indenture and to be no longer Outstanding
thereunder, and, at the election of the Company, the Company's
entire indebtedness in respect thereof will be satisfied and
discharged, if there has been irrevocably deposited with the
Trustee or any Paying Agent (other than the Company), in trust,
money in an amount which will be sufficient and/or Eligible
Obligations, the principal of and interest on which when due,
without regard to any reinvestment thereof, will provide moneys
which, together with moneys so deposited, will be sufficient to
pay when due the principal of and interest on this Security when
due.
The Indenture contains terms, provisions and conditions
relating to the consolidation or merger of the Company with or
into, and the conveyance or other transfer, or lease, of assets
to, another Person, to the assumption by such other Person, in
certain circumstances, of all of the obligations of the Company
under the Indenture and on the Securities and to the release and
discharge of the Company, in certain circumstances, from such
obligation.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is
registrable in the Security Register, upon surrender of this
Security for registration of transfer at the corporate trust
office of The Chase Manhattan Bank in New York, New York or such
other office or agency as may be designated by the Company from
time to time, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and
the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more
new Securities of this series of authorized denominations and of
like tenor and aggregate principal amount, will be issued to the
designated transferee or transferees.
The Securities of this series are issuable only as
registered Securities, without coupons, and in denominations of
$1,000 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations therein set forth,
Securities of this series are exchangeable for a like aggregate
principal amount of Securities of the same series and Tranche, of
any authorized denominations, as requested by the Holder
surrendering the same, and of like tenor upon surrender of the
Security or Securities to be exchanged at the corporate trust
office of The Chase Manhattan Bank in New York, New York or such
other office or agency as may be designated by the Company from
time to time.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Prior to due surrender of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name this Security
is registered as the absolute owner hereof for all purposes
(subject to Section 307 of the Indenture), whether or not this
Security be overdue, and neither the Company, the Trustee nor any
such agent shall be affected by notice to the contrary.
The Indenture and the Securities shall be governed by and
construed in accordance with the laws of the State of New York,
except to the extent that the Trust Indenture Act shall be
applicable.
As used herein,
(1) "Business Day" means any day, other than a Saturday or
Sunday, which is (a) not a day on which banking
institutions or trust companies in The City of New
York, New York or other city in which is located any
office or agency maintained for the payment of
principal of or premium, if any, or interest on this
Security, are authorized or required by law, regulation
or executive order to remain closed and (b) if the Base
Rate specified above is LIBOR, a London Banking Day.
"London Banking Day" means any day on which dealings in
deposits in the Index Currency, if any, specified above
are transacted in the London Interbank market;
(2) "Calculation Date", with respect to a Rate
Determination Date, means the earlier of (a) the tenth
calendar day after such Rate Determination Date, or, if
such day is not a Business Day, the next succeeding
Business Day, and (b) the Business Day next preceding
the related Interest Payment Date or the Maturity Date,
as the case may be;
(3) "Composite Quotations" means the daily statistical
release entitled "Composite 3:30 p.m. Quotations for
U.S. Government Securities," or any successor release,
published by the Federal Reserve Bank of New York;
(4) "H.15(519)" means the publication entitled "Statistical
Release H.15(519)," Selected Interest Rates, or any
successor publication, published by the Board of
Governors of the Federal Reserve System; and
(5) "Rate Determination Date" means, as applicable, a "CD
Rate Determination Date", a "CMT Rate Determination
Date", a "Commercial Paper Rate Determination Date", a
"Federal Funds Rate Determination Date", a "LIBOR
Determination Date", a "Prime Rate Determination Date"
or a "Treasury Rate Determination Date".
All other terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the
Indenture.
As provided in the Indenture, no recourse shall be had for
the payment of the principal of or premium, if any, or interest
on any Securities, or any part thereof, or for any claim based
thereon or otherwise in respect thereof, or of the indebtedness
represented thereby, or upon any obligation, covenant or
agreement under the Indenture, against, and no personal liability
whatsoever shall attach to, or be incurred by, any incorporator,
shareholder, officer or director, as such, past, present or
future of the Company or of any predecessor or successor
corporation (either directly or through the Company or a
predecessor or successor corporation), whether by virtue of any
constitutional provision, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise; it being
expressly agreed and understood that the Indenture and all the
Securities are solely corporate obligations and that any such
personal liability is hereby expressly waived and released as a
condition of, and as part of the consideration for, the execution
of the Indenture and the issuance of the Securities.
Unless the certificate of authentication hereon has been
executed by the Trustee or an Authenticating Agent by manual
signature, this Security shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument
to be duly executed.
THE WASHINGTON WATER POWER COMPANY
By:
------------------------------------------
[Title]
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated
therein referred to in the within-mentioned Indenture.
Dated:
-------------------
OR
--------------------------- -------------------
,
-------------------------- -------------------
AS TRUSTEE AS TRUSTEE
By: BY:[ ],
--------------------------
Authorized Officer AS AUTHENTICATING AGENT
By:
---------------------
Authorized Officer
This Security may not be transferred or exchanged, nor may
any purported transfer be registered, except (i) this Security
may be transferred in whole, and appropriate registration of
transfer effected, if such transfer is by Cede & Co., as nominee
for The Depository Trust Company (the "Depositary"), to the
Depositary, or by the Depositary to another nominee thereof, or
by any nominee of the Depositary to any other nominee thereof, or
by the Depositary or any nominee thereof to any successor
securities depositary or any nominee thereof; and (ii) this
Security may be exchanged for definitive Securities registered in
the respective names of the beneficial holders hereof, and
thereafter shall be transferable without restrictions if: (A) the
Depositary, or any successor securities depositary, shall have
notified the Company and the Trustee that it is unwilling or
unable to continue to act as securities depositary with respect
to the Securities and the Trustee shall not have been notified by
the Company within ninety (90) days of the identity of a
successor securities depositary with respect to the Securities;
(B) the Company shall have delivered to the Trustee a Company
Order to the effect that the Securities shall be so exchangeable
on and after a date specified therein; or (C)(1) an Event of
Default shall have occurred and be continuing, (2) the Trustee
shall have given notice of such Event of Default pursuant to
Section 802 of the Indenture and (3) there shall have been
delivered to the Company and the Trustee an Opinion of Counsel to
the effect that the interests of the beneficial owners of the
Securities in respect thereof will be materially impaired unless
such owners become Holders of definitive Securities.
-----------------------
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto
-----------------------------------------------------------------
[please insert social security or other identifying number of
assignee]
-----------------------------------------------------------------
[please print or typewrite name and address of assignee]
-----------------------------------------------------------------
the within Security of THE WASHINGTON WATER POWER COMPANY and
does hereby irrevocably constitute and appoint ,
-------------
Attorney, to transfer said Security on the books of the
within-mentioned Company, with full power of substitution in the
premises.
Dated:
--------------
------------------------------------------
Notice: The signature to this assignment must correspond with
the name as written upon the face of the Security in every
particular without alteration or enlargement or any change
whatsoever.
Exhibit 5(a)(1)
[Letterhead of Paine Hamblen LLP]
April 20, 1998
The Washington Water Power Company
1411 East Mission Avenue
Spokane, Washington 99202
Ladies and Gentlemen:
We are acting as counsel to The Washington Water Power
Company (the "Company") in connection with the proposed issuance
of unsecured debt securities (the "Debt Securities") of the
Company to be issued pursuant to the terms of an indenture from
the Company to The Chase Manhattan Bank, as trustee (the
"Indenture"), to be issued and sold from time to time by the
Company in one or more public offerings. The Debt Securities are
to be issued in an aggregate principal amount of up to
$250,000,000, as contemplated in the registration statement on
Form S-3 (Registration No. 333-39551) filed by the Company with
the Securities and Exchange Commission on November 5, 1997 for
the registration of the Debt Securities under the Securities Act
of 1933, as amended (the "Act"), said registration statement, as
proposed to be amended by Amendment No. 1 thereto and including
the exhibits thereto, being hereinafter called the "Registration
Statement".
We have examined and are familiar with originals or copies,
certified or otherwise identified to our satisfaction, of (i) the
Registration Statement, (ii) the Indenture, (iii) the related
resolutions of the Company's Board of Directors, (iv) the related
orders of the Washington Utilities and Transportation Commission
("WUTC"), the California Public Utilities Commission ("CPUC"),
the Idaho Public Utilities Commission ("IPUC") and the Public
Utility Commission of Oregon ("OPUC"), and (v) a Certificate of
Existence/Authorization issued by the Secretary of State of
Washington. We have also examined such other documents and
satisfied ourselves as to such other matters as we have deemed
necessary in order to render this opinion. As to various facts
material to the opinions expressed below, we have relied on
certificates of public officials, certificates of officers or
employees of the Company, representations contained in documents,
and other oral or written assurances by officers or employees of
the Company.
Based upon the foregoing and subject to the qualifications
herein expressed, we are of the opinion that the Company is a
corporation duly incorporated, validly existing and in good
standing under the laws of the State of Washington; and we are
also of the opinion that:
(a) the issuance and sale by the Company of the Debt
Securities as contemplated in the Registration Statement
have been duly authorized by the Company's Board of
Directors, subject to the terms and limitations set forth in
the resolutions of the Board of Directors; and no further
corporate action on the part of the Company is necessary to
authorize such issuance and sale of the Debt Securities or
in order for the Debt Securities, when so issued and sold,
to constitute valid and binding obligations of the Company,
provided, that such issuance and sale is within the terms
and limitations set forth in such resolutions; and
(b) the issuance and sale by the Company of the Debt
Securities as contemplated in the Registration Statement
have been duly authorized by appropriate orders of the WUTC,
CPUC, IPUC and OPUC, subject, in the case of the order of
the OPUC, to the terms and limitations set forth therein;
each of such orders, to the best of our knowledge, remains
in full force and effect on the date hereof; and no further
approval, authorization, consent or other order of, or
filing with, any governmental agency of the States of
Washington, California, Idaho, Montana and Oregon is legally
required for the authorization of such issuance and sale of
the Debt Securities or in order for the Debt Securities,
when so issued and sold, to constitute valid and binding
obligations of the Company, provided, that, with respect to
the State of Oregon, such issuance and sale is within the
terms and limitations set forth in such order of the OPUC.
The opinions expressed herein are limited to the laws of the
States of Washington, California, Idaho, Montana and Oregon
(excluding therefrom principles of conflicts of laws, state
securities or blue sky laws and laws of political subdivisions of
such States).
This opinion is given as of the date hereof, without any
obligation upon us to update this opinion or to advise the
addressee hereof or any other party of any changes in
circumstances or laws that may hereafter be brought to our
attention or occur which may affect this opinion.
We hereby consent to the filing of this opinion as Exhibit
5(a)(1) to the Registration Statement and to the references to
our firm, as counsel, under the heading "Legal Matters" in the
prospectus which forms a part of the Registration Statement. In
giving the foregoing consent, we do not admit that we are within
the category of persons whose consent is required under Section 7
of the Act or the rules and regulations promulgated thereunder.
Except as expressly permitted hereby, this opinion may not be
used, delivered, circulated, filed, quoted or otherwise referred
to.
Very truly yours,
PAINE, HAMBLEN, COFFIN,
BROOKE & MILLER LLP
/s/ Paine - Hamblen
Exhibit 5(a)(2)
[Letterhead of Paine Hamblen LLP]
___________ , ____
The Washington Water Power Company
1411 East Mission Avenue
Spokane, Washington 99202
Ladies and Gentlemen:
We are acting as counsel to The Washington Water Power
Company (the "Company") in connection with the proposed issuance
of unsecured notes of the Company described in the Pricing
Supplement attached hereto as Annex A (the "Pricing Supplement"),
such notes being hereinafter called the "Offered Notes". The
Offered Notes constitute a tranche of the unsecured debt
securities in an aggregate principal of up $250,000,000 (the
"Debt Securities") to be issued pursuant to the terms of an
indenture from the Company to The Chase Manhattan Bank, as
trustee (the "Indenture"), to be issued and sold from time to
time by the Company in one or more public offerings. The Offered
Notes are to be issued as contemplated in the Pricing Supplement
which constitutes a supplement to the prospectus which forms part
of the registration statement on Form S-3 (Registration No. 333-
39551), filed by the Company with the Securities and Exchange
Commission for the registration of the Offered Notes as a tranche
of the Debt Securities under the Securities Act of 1933, as
amended (the "Act"), said registration statement, as amended by
Amendment No. 1 thereto ("Amendment No. 1") and including the
exhibits thereto, being hereinafter called the "Registration
Statement".
This opinion with respect to the Offered Notes is
supplemental to our prior opinion dated April 20, 1998 also
addressed to the Company with respect to the Debt Securities
generally, which was filed with Amendment No. 1 as Exhibit
5(a)(1) to the Registration Statement.
We have examined and are familiar with originals or copies,
certified or otherwise identified to our satisfaction, of (i) the
Registration Statement, (ii) the Indenture, (iii) the related
resolutions of the Company's Board of Directors, (iv) the related
orders of the Washington Utilities and Transportation Commission
("WUTC"), the California Public Utilities Commission ("CPUC"),
the Idaho Public Utilities Commission ("IPUC") and the Public
Utility Commission of Oregon ("OPUC"), and (v) a Certificate of
Existence/Authorization issued by the Secretary of State of
Washington. We have also examined such other documents and
satisfied ourselves as to such other matters as we have deemed
necessary in order to render this opinion. As to various facts
material to the opinions expressed below, we have relied on
certificates of public officials, certificates of officers or
employees of the Company, representations contained in documents,
and other oral or written assurances by officers or employees of
the Company.
Based upon the foregoing and subject to the qualifications
herein expressed, we are of the opinion that the Company is a
corporation duly incorporated, validly existing and in good
standing under the laws of the State of Washington; and we are
also of the opinion that:
(a) the issuance and sale by the Company of the
Offered Notes as contemplated in the Registration Statement
and the Pricing Supplement have been duly authorized by the
Company's Board of Directors; and no further corporate
action on the part of the Company is necessary to authorize
such issuance and sale of the Offered Notes or in order for
the Offered Notes, when so issued and sold, to constitute
valid and binding obligations of the Company; and
(b) the issuance and sale by the Company of the
Offered Notes as contemplated in the Registration Statement
and the Pricing Supplement have been duly authorized by
appropriate orders of the WUTC, CPUC, IPUC and OPUC; each of
such orders, to the best of our knowledge, remains in full
force and effect on the date hereof; and no further
approval, authorization, consent or other order of, or
filing with, any governmental agency of the States of
Washington, California, Idaho, Montana and Oregon is legally
required for the authorization of such issuance and sale of
the Offered Notes or in order for the Offered Notes, when so
issued and sold, to constitute valid and binding obligations
of the Company.
The opinions expressed herein are limited to the laws of the
States of Washington, California, Idaho, Montana and Oregon
(excluding therefrom principles of conflicts of laws, state
securities or blue sky laws and laws of political subdivisions of
such States).
This opinion is given as of the date hereof, without any
obligation upon us to update this opinion or to advise the
addressee hereof or any other party of any changes in
circumstances or laws that may hereafter be brought to our
attention or occur which may affect this opinion.
We hereby consent to the filing of this opinion as Exhibit
5(a)(2) to the Registration Statement and to the references to
our firm, as counsel, under the headings "Legal Matters" in the
prospectus which forms a part of the Registration Statement and
in the supplement to such prospectus dated _________, _____ and
the Pricing Supplement. In giving the foregoing consent, we do
not admit that we are within the category of persons whose
consent is required under Section 7 of the Act or the rules and
regulations promulgated thereunder. Except as expressly
permitted hereby, this opinion may not be used, delivered,
circulated, filed, quoted or otherwise referred to.
Very truly yours,
PAINE, HAMBLEN, COFFIN,
BROOKE & MILLER LLP
[Letterhead of R&P]
Exhibit 5(b)(1)
April 20, 1998
The Washington Water Power Company
1411 East Mission Avenue
Spokane, Washington 99202
Ladies and Gentlemen:
We are acting as counsel to The Washington Water Power
Company (the "Company") in connection with the proposed issuance
of unsecured debt securities (the "Debt Securities") of the
Company to be issued pursuant to the terms of an indenture from
the Company to The Chase Manhattan Bank, as trustee (the
"Indenture"), to be issued and sold from time to time by the
Company in one or more public offerings. The Debt Securities are
to be issued in an aggregate principal amount of up to
$250,000,000, as contemplated by the registration statement on
Form S-3 (Registration No. 333-39551) filed by the Company with
the Securities and Exchange Commission on November 5, 1997 for
the registration of the Debt Securities under the Securities Act
of 1933, as amended (the "Act"), said registration statement, as
proposed to be amended by Amendment No. 1 thereto and including
the exhibits thereto, being hereinafter called the "Registration
Statement".
We have examined and are familiar with originals or copies,
certified or otherwise identified to our satisfaction, of (i) the
Registration Statement and (ii) the Indenture. We have also
examined such other documents and satisfied ourselves as to such
other matters as we have deemed necessary in order to render this
opinion.
Based upon the foregoing and subject to the qualifications
hereinafter expressed, we are of the opinion that the Debt
Securities, when issued and sold as contemplated in the
Registration Statement, will be legally issued and will be
binding obligations of the Company.
The opinions expressed herein are limited to the laws of the
State of New York and the federal law of the United States
(excluding therefrom principles of conflicts of laws and state
securities or blue sky laws). To the extent that such opinions
relate to or are dependent upon matters governed by the laws of
other States, we have assumed (1) the legal conclusions set forth
in the opinion of Paine, Hamblen, Coffin, Brooke & Miller LLP,
which is being filed as Exhibit 5(a)(1) to the Registration
Statement and (2) that the issuance and sale of the Debt
Securities will be within the corporate and regulatory terms and
limitations referred to in such opinion.
We hereby consent to the filing of this opinion as Exhibit
5(b)(1) to the Registration Statement and to the references to
our firm, as counsel, in the Registration Statement and in the
prospectus contained therein. In giving the foregoing consent,
we do not admit that we are within the category of persons whose
consent is required under Section 7 of the Act or the rules and
regulations promulgated thereunder.
Very truly yours,
/s/ Reid & Priest LLP
REID & PRIEST LLP
Exhibit 5(b)(2)
[Letterhead of R&P]
___________ , ____
The Washington Water Power Company
1411 East Mission Avenue
Spokane, Washington 99202
Ladies and Gentlemen:
We refer to our opinion, dated April 20, 1998 (the "April 20
Opinion"), addressed to The Washington Water Power Company (the
"Company") with respect to $250,000,000 in aggregate principal
amount of Debt Securities registered under the Securities Act of
1933, as amended (the "Act"), on the Registration Statement on
Form S-3 (Registration No. 333-39551), said registration
statement, as heretofore amended and as proposed to be amended
and including the exhibits thereto, being hereinafter called the
"Registration Statement". This opinion is supplemental to the
April 20 Opinion.
We further refer to the notes of the Company described in
the Pricing Supplement attached hereto as Annex A. Such notes
constitute a tranche of the aforesaid Debt Securities and are
hereinafter called the "Offered Notes"; and such Pricing
Supplement constitutes a supplement to the prospectus contained
in the Registration Statement and is hereinafter called the
"Pricing Supplement".
Based upon the foregoing and subject to the qualifications
hereinafter expressed, we are of the opinion that the Offered
Notes, when issued and sold as contemplated in the Registration
Statement and the Pricing Supplement, will be legally issued and
will be binding obligations of the Company.
The opinions expressed herein are limited to the laws of the
State of New York and the federal law of the United States
(excluding therefrom principles of conflicts of laws and state
securities or blue sky laws). To the extent that such opinions
relate to or are dependent upon matters governed by the laws of
other States, we have assumed the legal conclusions set forth in
the opinions of Paine, Hamblen, Coffin, Brooke & Miller LLP,
which have been and are being filed as Exhibits to the
Registration Statement.
We hereby consent to the filing of this opinion as
Exhibit 5(b)(2) to the Registration Statement and to the
references to our firm, as counsel, in the supplements to the
prospectus contained in the Registration Statement relating to
the Offered Notes. In giving the foregoing consent, we do not
admit that we are within the category of persons whose consent is
required under Section 7 of the Act or the rules and regulations
promulgated thereunder.
Very truly yours,
REID & PRIEST LLP
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Amendment
No. 1 to the Registration Statement No. 333-39551 of The
Washington Water Power Company on Form S-3 of our report dated
January 30, 1998, appearing in the Annual Report on Form 10-K of
The Washington Water Power Company for the year ended December
31, 1997 and to the reference to us under the heading "Experts"
in the Prospectus, which is part of such Registration Statement.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Seattle, Washington
April 20, 1998
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SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
-------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
--------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2)
---------
--------------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
NEW YORK 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 PARK AVENUE
NEW YORK, NEW YORK 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
----------------------------------------------------
THE WASHINGTON WATER POWER COMPANY
(Exact name of obligor as specified in its charter)
WASHINGTON 91-0462470
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
1411 EAST MISSION AVENUE
SPOKANE, WASHINGTON 99202
(Address of principal executive offices) (Zip Code)
---------------------------------
MEDIUM-TERM NOTES, SERIES C
(Title of the indenture securities)
-------------------------------------------
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising
authority to which it is subject.
New York State Banking Department, State House, Albany,
New York 12110.
Board of Governors of the Federal Reserve System,
Washington, D.C., 20551
Federal Reserve Bank of New York, District No. 2, 33
Liberty Street, New York, N.Y.
Federal Deposit Insurance Corporation, Washington,
D.C., 20429.
(b) Whether it is authorized to exercise corporate trust
powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe
each such affiliation.
None.
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement
of Eligibility.
1. A copy of the Articles of Association of the Trustee
as now in effect, including the Organization Certificate and the
Certificates of Amendment dated February 17, 1969, August 31,
1977, December 31, 1980, September 9, 1982, February 28, 1985,
December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249,
which is incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee
to Commence Business (see Exhibit 2 to Form T-1 filed in
connection with Registration Statement No. 33-50010, which is
incorporated by reference. On July 14, 1996, in connection with
the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation,
was renamed The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers
being contained in the documents identified above as Exhibits 1
and 2.
4. A copy of the existing By-Laws of the Trustee (see
Exhibit 4 to Form T-1 filed in connection with Registration
Statement No. 333-06249, which is incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b)
of the Act (see Exhibit 6 to Form T-1 filed in connection with
Registration Statement No. 33-50010, which is incorporated by
reference. On July 14, 1996, in connection with the merger of
Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was
renamed The Chase Manhattan Bank).
7. A copy of the latest report of condition of the
Trustee, published pursuant to law or the requirements of its
supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of
1939 the Trustee, The Chase Manhattan Bank, a corporation
organized and existing under the laws of the State of New York,
has duly caused this statement of eligibility to be signed on its
behalf by the undersigned, thereunto duly authorized, all in the
City of New York and State of New York, on the 16th day of April,
1998.
THE CHASE MANHATTAN BANK
By /s/ R. Lorenzen
-----------------------------
/s/ R. Lorenzen
Senior Trust Officer
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business December 31, 1997, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
DOLLAR AMOUNTS
ASSETS IN MILLIONS
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin . . . . . . . . . . . . . . . $ 12,428
Interest-bearing balances . . . . . . . . . . . 3,428
Securities: . . . . . . . . . . . . . . . . . . .
Held to maturity securities . . . . . . . . . . . . 2,561
Available for sale securities . . . . . . . . . . . 43,058
Federal funds sold and securities purchased under
agreements to resell . . . . . . . . . . . . . . 29,633
Loans and lease financing receivables:
Loans and leases, net of unearned income $129,260
Less: Allowance for loan and lease losses 2,783
Less: Allocated transfer risk reserve 0
--------
Loans and leases, net of unearned income,
allowance, and reserve . . . . . . . . . . . . 126,477
Trading Assets . . . . . . . . . . . . . . . . . . 62,575
Premises and fixed assets (including capitalized
leases) . . . . . . . . . . . . . . . . . . . . 2,943
Other real estate owned . . . . . . . . . . . . . 295
Investments in unconsolidated subsidiaries and
associated companies . . . . . . . . . . . . . . 231
Customers' liability to this bank on acceptances
outstanding . . . . . . . . . . . . . . . . . . 1,698
Intangible assets . . . . . . . . . . . . . . . . 1,466
Other assets . . . . . . . . . . . . . . . . . . . 10,268
--------
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . $297,061
========
LIABILITIES
Deposits
In domestic offices . . . . . . . . . . . . . . $ 94,524
Noninterest-bearing . . . . . . . . . $ 39,487
Interest-bearing . . . . . . . . . . . 55,037
--------
In foreign offices, Edge and Agreement,
subsidiaries and IBF's . . . . . . . . . . . . 71,162
Noninterest-bearing . . . . . . . . . . . $ 3,205
Interest-bearing . . . . . . . . . . . 67,957
Federal funds purchased and securities sold under agree-
ments to repurchase . . . . . . . . . . . . . . . 43,181
Demand notes issued to the U.S. Treasury . . . . . 1,000
Trading liabilities . . . . . . . . . . . . . . . . 48,903
Other borrowed money (includes mortgage indebtedness
and obligations under capitalized leases):
With a remaining maturity of one year or less . 3,599
With a remaining maturity of more than one year
through three years . . . . . . . . . . . . . 253
With a remaining maturity of more than
three years . . . . . . . . . . . . . . . . . 132
Bank's liability on acceptances executed and outstanding 1,698
Subordinated notes and debentures . . . . . . . . . 5,715
Other liabilities . . . . . . . . . . . . . . . . . 9,896
TOTAL LIABILITIES . . . . . . . . . . . . . . . . . 280,063
--------
EQUITY CAPITAL
Perpetual preferred stock and related surplus 0
Common stock . . . . . . . . . . . . . . . . . . . 1,211
Surplus (exclude all surplus related to
preferred stock) . . . . . . . . . . . . . . . . . 10,291
Undivided profits and capital reserves . . . . . . 5,502
Net unrealized holding gains (losses)
on available-for-sale securities . . . . . . . . . (22)
Cumulative foreign currency translation
adjustments . . . . . . . . . . . . . . . . . . . . 16
TOTAL EQUITY CAPITAL . . . . . . . . . . . . . . . 16,998
--------
TOTAL LIABILITIES AND EQUITY CAPITAL . . . . . . . $297,061
========
I, Joseph L. Sclafani, E.V.P. & Controller
of the above-named bank, do hereby declare
that this Report of Condition has been
prepared in conformance with the instructions
issued by the appropriate Federal regulatory
authority and is true to the best of my
knowledge and belief.
JOSEPH L. SCLAFANI
We, the undersigned directors, attest to the
correctness of this Report of Condition and
declare that it has been examined by us, and
to the best of our knowledge and belief has
been prepared in conformance with the in-
structions issued by the appropriate Federal
regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR. )