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Exhibit 4.1
CONFORMED COPY
AVISTA
CORPORATION
TO
CITIBANK, N.A.
As Successor Trustee under
Mortgage and Deed of Trust,
dated as of June 1, 1939
Forty-fourth Supplemental
Indenture
Providing among other things for a series of
bonds designated
"First Mortgage Bonds, 7.25% Series due 2013"
Due December 16, 2013
Dated as of December 1,
2008
FORTY-FOURTH SUPPLEMENTAL
INDENTURE
THIS INDENTURE , dated as of the 1st day of December, 2008,
between AVISTA CORPORATION (formerly known as The Washington Water
Power Company), a corporation of the State of Washington, whose
post office address is 1411 East Mission Avenue, Spokane,
Washington 99202 (the "Company"), and CITIBANK, N.A., formerly
First National City Bank (successor by merger to First National
City Trust Company, formerly City Bank Farmers Trust Company), a
national banking association incorporated and existing under the
laws of the United States of America, whose post office address is
388 Greenwich Street, 14 th
Floor, New York, New York 10013 (the "Trustee"), as
Trustee under the Mortgage and Deed of Trust, dated as of
June 1, 1939 (the "Original Mortgage"), executed and delivered
by the Company to secure the payment of bonds issued or to be
issued under and in accordance with the provisions thereof, this
indenture (the "Forty-fourth Supplemental Indenture") being
supplemental to the Original Mortgage, as heretofore supplemented
and amended.
WHEREAS pursuant to a written request of the Company made in
accordance with Section 103 of the Original Mortgage,
Francis M. Pitt (then Individual Trustee under the Mortgage,
as supplemented) ceased to be a trustee thereunder on July 23,
1969, and all of his powers as Individual Trustee have devolved
upon the Trustee and its successors alone; and
WHEREAS by the Original Mortgage the Company covenanted that it
would execute and deliver such further instruments and do such
further acts as might be necessary or proper to carry out more
effectually the purposes of the Original Mortgage and to make
subject to the lien of the Original Mortgage any property
thereafter acquired intended to be subject to the lien thereof;
and
WHEREAS the Company has heretofore executed and delivered, in
addition to the Original Mortgage, the indentures supplemental
thereto, and has issued the series of bonds, set forth in
Exhibit A hereto (the Original Mortgage, as supplemented and
amended by the First through Forty-third Supplemental Indentures,
being herein sometimes called the "Mortgage"); and
WHEREAS the Original Mortgage and the First through Forty-second
Supplemental Indentures have been appropriately filed or recorded
in various official records in the States of Washington, Idaho,
Montana and Oregon, as set forth in the First through Forty-third
Supplemental Indentures and the Instrument of Further Assurance,
dated December 15, 2001, hereinafter referred to; and
WHEREAS the Forty-third Supplemental Indenture, dated as of
November 1, 2008 has been appropriately filed or recorded, or
delivered for filing or recording, in the various official records
in the States of Washington, Idaho, Montana and
Oregon, information as to such filing and
recording to be set forth in a subsequent supplemental indenture;
and
WHEREAS for the purpose of confirming or perfecting the lien of
the Mortgage on certain of its properties, the Company has
heretofore executed and delivered a Short Form Mortgage and
Security Agreement, in multiple counterparts dated as of various
dates in 1992, and such instrument has been appropriately filed or
recorded in the various official records in the States of Montana
and Oregon; and
WHEREAS for the purpose of confirming or perfecting the lien of
the Mortgage on certain of its properties, the Company has
heretofore executed and delivered an Instrument of Further
Assurance dated as of December 15, 2001, and such instrument
has been appropriately filed or recorded in the various official
records in the States of Washington, Idaho, Montana and Oregon;
and
WHEREAS in addition to the property described in the Mortgage
the Company has acquired certain other property, rights and
interests in property; and
WHEREAS Section 8 of the Original Mortgage provides that
the form of each series of Bonds (other than the First Series)
issued thereunder and of the coupons to be attached to coupon Bonds
of such series shall be established by Resolution of the Board of
Directors of the Company; that the form of such series, as
established by said Board of Directors, shall specify the
descriptive title of the Bonds and various other terms thereof; and
that such series may also contain such provisions not inconsistent
with the provisions of the Mortgage as the Board of Directors may,
in its discretion, cause to be inserted therein expressing or
referring to the terms and conditions upon which such bonds are to
be issued and/or secured under the Mortgage; and
WHEREAS Section 120 of the Original Mortgage provides,
among other things, that any power, privilege or right expressly or
impliedly reserved to or in any way conferred upon the Company by
any provision of the Mortgage, whether such power, privilege or
right is in any way restricted or is unrestricted, may be in whole
or in part waived or surrendered or subjected to any restriction if
at the time unrestricted or to additional restriction if already
restricted, and the Company may enter into any further covenants,
limitations or restrictions for the benefit of any one or more
series of bonds issued thereunder, or the Company may cure any
ambiguity contained therein, or in any supplemental indenture, by
an instrument in writing executed and acknowledged by the Company
in such manner as would be necessary to entitle a conveyance of
real estate to record in all of the states in which any property at
the time subject to the lien of the Mortgage shall be situated;
and
WHEREAS the Company now desires to create a new series of bonds;
and
WHEREAS the execution and delivery by the Company of this
Forty-fourth Supplemental Indenture and the terms of the Bonds of
the Forty-fourth Series,
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hereinafter referred to, have been duly
authorized by the Board of Directors of the Company by appropriate
Resolutions of said Board of Directors, and all things necessary to
make this Forty-fourth Supplemental Indenture a valid, binding and
legal instrument have been performed;
NOW, THEREFORE, THIS INDENTURE WITNESSETH: That the Company, in
consideration of the premises and of other good and valuable
consideration, the receipt and sufficiency whereof are hereby
acknowledged, hereby confirms the estate, title and rights of the
Trustee (including, without limitation, the lien of the Mortgage on
the property of the Company subjected thereto, whether now owned or
hereafter acquired) held as security for the payment of both the
principal of and interest and premium, if any, on the Bonds from
time to time issued under the Mortgage according to their tenor and
effect and the performance of all the provisions of the Mortgage
and of such Bonds, and, without limiting the generality of the
foregoing, hereby confirms the grant, bargain, sale, release,
conveyance, assignment, transfer, mortgage, pledge, setting over
and confirmation unto the Trustee, contained in the Mortgage, of
all the following described properties of the Company, whether now
owned or hereafter acquired, namely:
All of the property, real, personal and mixed, of every
character and wheresoever situated (except any hereinafter or in
the Mortgage expressly excepted) which the Company now owns or,
subject to the provisions of Section 87 of the Original
Mortgage, may hereafter acquire prior to the satisfaction and
discharge of the Mortgage, as fully and completely as if herein or
in the Mortgage specifically described, and including (without in
anywise limiting or impairing by the enumeration of the same the
scope and intent of the foregoing or of any general description
contained in Mortgage) all lands, real estate, easements,
servitudes, rights of way and leasehold and other interests in real
estate; all rights to the use or appropriation of water, flowage
rights, water storage rights, flooding rights, and other rights in
respect of or relating to water; all plants for the generation of
electricity, power houses, dams, dam sites, reservoirs, flumes,
raceways, diversion works, head works, waterways, water works,
water systems, gas plants, steam heat plants, hot water plants, ice
or refrigeration plants, stations, substations, offices, buildings
and other works and structures and the equipment thereof and all
improvements, extensions and additions thereto; all generators,
machinery, engines, turbines, boilers, dynamos, transformers,
motors, electric machines, switchboards, regulators, meters,
electrical and mechanical appliances, conduits, cables, pipes and
mains; all lines and systems for the transmission and distribution
of electric current, gas, steam heat or water for any purpose; all
towers, mains, pipes, poles, pole lines, conduits, cables, wires,
switch racks, insulators, compressors, pumps, fittings, valves and
connections; all motor vehicles and automobiles; all tools,
implements, apparatus, furniture, stores, supplies and equipment;
all
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franchises (except the Company’s franchise
to be a corporation), licenses, permits, rights, powers and
privileges; and (except as hereinafter or in the Mortgage expressly
excepted) all the right, title and interest of the Company in and
to all other property of any kind or nature.
The property so conveyed or intended to be so conveyed under the
Mortgage shall include, but shall not be limited to, the property
set forth in Exhibit B hereto, the particular description of which
is intended only to aid in the identification thereof and shall not
be construed as limiting the force, effect and scope of the
foregoing.
TOGETHER WITH all and singular the tenements, hereditaments and
appurtenances belonging or in anywise appertaining to the aforesaid
property or any part thereof, with the reversion and reversions,
remainder and remainders and (subject to the provisions of
Section 57 of the Original Mortgage) the tolls, rents,
revenues, issues, earnings, income, product and profits thereof,
and all the estate, right, title and interest and claim whatsoever,
at law as well as in equity, which the Company now has or may
hereafter acquire in and to the aforesaid property and franchises
and every part and parcel thereof.
THE COMPANY HEREBY CONFIRMS that, subject to the provisions of
Section 87 of the Original Mortgage, all the property, rights,
and franchises acquired by the Company after the date thereof
(except any hereinbefore or hereinafter or in the Mortgage
expressly excepted) are and shall be as fully embraced within the
lien of the Mortgage as if such property, rights and franchises had
been owned by the Company at the date of the Original Mortgage and
had been specifically described therein.
PROVIDED THAT the following were not and were not intended to be
then or now or hereafter granted, bargained, sold, released,
conveyed, assigned, transferred, mortgaged, pledged, set over or
confirmed under the Mortgage and were, are and shall be expressly
excepted from the lien and operation of the Mortgage
namely: (l) cash, shares of stock and obligations
(including bonds, notes and other securities) not hereafter
specifically pledged, paid, deposited or delivered under the
Mortgage or covenanted so to be; (2) merchandise, equipment,
materials or supplies held for the purpose of sale in the usual
course of business or for consumption in the operation of any
properties of the Company; (3) bills, notes and accounts
receivable, and all contracts, leases and operating agreements not
specifically pledged under the Mortgage or covenanted so to be;
(4) electric energy and other materials or products generated,
manufactured, produced or purchased by the Company for sale,
distribution or use in the ordinary course of its business; and
(5) any property heretofore released pursuant to any
provisions of the Mortgage and not heretofore disposed of by the
Company; provided, however, that the property and rights expressly
excepted from the lien and operation of the Mortgage in the above
subdivisions (2) and (3) shall (to the extent permitted
by law) cease to be so excepted in the event that the Trustee or a
receiver or trustee shall enter
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upon and take possession of the Mortgaged and
Pledged Property in the manner provided in Article XII of the
Original Mortgage by reason of the occurrence of a Completed
Default as defined in said Article XII.
TO HAVE AND TO HOLD all such properties, real, personal and
mixed, granted, bargained, sold, released, conveyed, assigned,
transferred, mortgaged, pledged, set over or confirmed by the
Company in the Mortgage as aforesaid, or intended so to be, unto
the Trustee, and its successors, heirs and assigns forever.
IN TRUST NEVERTHELESS, for the same purposes and upon the same
terms, trusts and conditions and subject to and with the same
provisos and covenants as set forth in the Mortgage, this
Forty-fourth Supplemental Indenture being supplemental to the
Mortgage.
AND IT IS HEREBY FURTHER CONFIRMED by the Company that all the
terms, conditions, provisos, covenants and provisions contained in
the Mortgage shall affect and apply to the property in the Mortgage
described and conveyed, and to the estates, rights, obligations and
duties of the Company and the Trustee and the beneficiaries of the
trust with respect to said property, and to the Trustee and its
successors in the trust, in the same manner and with the same
effect as if the said property had been owned by the Company at the
time of the execution of the Original Mortgage, and had been
specifically and at length described in and conveyed to said
Trustee by the Original Mortgage as a part of the property therein
stated to be conveyed.
The Company further covenants and agrees to and with the Trustee
and its successor or successors in such trust under the Mortgage,
as follows:
ARTICLE I
Forty-fourth Series of Bonds
SECTION 1. (I) There shall be a Series of Bonds designated
"First Mortgage Bonds, 7.25% Series due 2013" (herein sometimes
referred to as the "Bonds of the Forty-fourth Series"), each of
which shall also bear the descriptive title First Mortgage Bond and
the form thereof, which has been established by Resolution of the
Board of Directors of the Company, is set forth on Exhibit C
hereto. The Bonds of the Forty-fourth Series shall be issued as
fully registered Bonds in denominations of One Thousand Dollars
and, at the option of the Company, any amount in excess thereof
(the exercise of such option to be evidenced by the execution and
delivery thereof) and shall be dated as in Section 10 of the
Original Mortgage provided. The Bonds of the Forty-fourth Series
shall be limited in aggregate principal amount to $30,000,000
(except for Bonds of such series authenticated and delivered upon
transfer of or in exchange for, or in lieu of, other Bonds of such
series).
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The Bonds of the Forty-fourth Series shall
mature, shall bear interest and shall be payable as set forth
below:
(a) the principal of Bonds of the Forty-fourth Series shall
(unless theretofore paid) be payable on the Stated Maturity Date
(as hereinafter defined);
(b) the Bonds of the Forty-fourth Series shall bear interest at
the rate of seven and twenty-five one hundredths percentum
(7.25%) per annum; interest on such Bonds shall accrue from
and including the date of the initial authentication and delivery
thereof, except as otherwise provided in the form of bond attached
hereto as Exhibit C; interest on such Bonds shall be payable
on each Interest Payment Date and at Maturity (as each of such
terms is hereinafter defined); and interest on such Bonds during
any period for which payment is made shall be computed on the basis
of a 360-day year consisting of twelve 30-days months;
(c) the principal of and premium, if any, and interest on each
Bond of the Forty-fourth Series payable at Maturity shall be
payable upon presentation thereof at the office or agency of the
Company in the Borough of Manhattan, The City of New York, in such
coin or currency as at the time of payment is legal tender for
public and private debts. The interest on each Bond of the
Forty-fourth Series (other than interest payable at Maturity) shall
be payable by check, in similar coin or currency, mailed to the
registered owner thereof as of the close of business on the Record
Date (as hereinafter defined) next preceding each Interest Payment
Date; provided, however, that if such registered owner 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 registered owner; and, provided, further, that, so
long as the Bonds of the Forty-fourth Series shall be held by an
Institutional Investor (as hereinafter defined), payment of
principal of and premium, if any, and interest on the Bonds of the
Forty-fourth Series shall be payable in the manner specified in the
Bond Purchase Agreement (as hereinafter defined).
(d) The Bonds of the Forty-fourth Series shall be redeemable in
whole at any time, or in part from time to time, at the option of
the Company at a redemption price equal to the greater of
(i) 100% of the principal amount of the Bonds being redeemed,
and
(ii) the sum of the present values of the remaining scheduled
payments of principal of and interest (not including any portion of
any scheduled payment of interest which accrued prior to the
redemption date) on the Bonds being redeemed discounted to the date
of redemption on a semiannual
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basis (assuming a 360-day year consisting of
twelve 30-day months) at a discount rate equal to the Treasury
Yield (as hereinafter defined) plus 50 basis points,
plus , in the case of either (i) or (ii) above,
whichever is applicable, accrued interest on such Bonds to the date
of redemption.
(e) (i) "Treasury Yield" means, with respect to any redemption
of Bonds of the Forty-fourth Series, the rate per annum equal to
the semiannual equivalent yield to maturity of the Comparable
Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the
Comparable Treasury Price. The Treasury Yield shall be calculated
as of the third business day preceding the redemption date (the
"Calculation Date").
(ii) "Comparable Treasury Issue" means the United States
Treasury security selected by an Independent Investment Banker as
having a maturity comparable to the remaining term of the Bonds of
the Forty-fourth Series that would be utilized, at the time of
selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable
maturity to the remaining term of the Bonds.
(iii) "Comparable Treasury Price" means, (A) the average of
the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) on
the Calculation Date, as set forth in the H.15 Daily Update of the
Federal Reserve Bank of New York or (B) if such release (or
any successor release) is not published or does not contain such
prices on such business day, the Reference Treasury Dealer
Quotation for the Calculation Date.
(iv) "H.15(519)" means the weekly statistical release entitled
"Statistical Release H.15 (519)", or any successor publication,
published by the Board of Governors of the Federal Reserve
System.
(v) "H.15 Daily Update" means the daily update of H.15(519)
available through the worldwide website of the Board of Governors
of the Federal Reserve System or any successor site or
publication.
(vi) "Independent Investment Banker" means KeyBanc Capital
Markets Inc. or, if so determined by the Company, any other
independent investment banking institution of national standing
appointed by the Company and reasonably acceptable to the
Trustee.
(vii) "Reference Treasury Dealer Quotation" means, with respect
to the Reference Treasury Dealer, the average, as determined by the
Trustee, of the bid and asked prices for the Comparable Treasury
Issue (expressed
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in each case as a percentage of its principal
amount and quoted in writing to the Trustee by such Reference
Treasury Dealer at 5:00 p.m. on the Calculation Date).
(viii) "Reference Treasury Dealer" means a primary U.S.
Government securities dealer in New York City appointed by the
Company and reasonably acceptable to the Trustee.
(II) (a) At the option of the registered owner, any Bonds of the
Forty-fourth Series, upon surrender thereof for cancellation at the
office or agency of the Company in the Borough of Manhattan, The
City of New York, shall be exchangeable for a like aggregate
principal amount of Bonds of the same Series of other authorized
denominations.
The Bonds of the Forty-fourth Series shall be transferable, upon
the surrender thereof for cancellation, together with a written
instrument of transfer in form approved by the registrar duly
executed by the registered owner or by his duly authorized
attorney, at the office or agency of the Company in the Borough of
Manhattan, The City of New York.
Upon any exchange or transfer of Bonds of the Forty-fourth
Series, the Company may make a charge therefor sufficient to
reimburse it for any tax or taxes or other governmental charge, as
provided in Section 12 of the Original Mortgage, but the
Company hereby waives any right to make a charge in addition
thereto or any exchang
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