TRUST INDENTURE

EXHIBIT 4.2

CONFORMED COPY

TRUST INDENTURE

BETWEEN

CITY OF FORSYTH, MONTANA

AND

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.

AS TRUSTEE

$17,000,000

CITY OF FORSYTH, MONTANA

POLLUTION CONTROL REVENUE REFUNDING BONDS

(AVISTA CORPORATION COLSTRIP PROJECT)

SERIES 2008

DATED AS OF DECEMBER 1, 2008

TABLE OF CONTENTS

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TRUST INDENTURE

THIS TRUST INDENTURE is made and entered into as of December 1, 2008, between the CITY OF FORSYTH, MONTANA, a political subdivision duly organized and existing under the Constitution and laws of the State and The Bank of New York Mellon Trust Company, N.A., as trustee.

RECITALS

A. In furtherance of its public purposes, the Issuer has entered into a Loan Agreement, dated as of December 1, 2008, with Avista Corporation, a Washington corporation, providing for the issuance by the Issuer of the Bonds for the purpose of refunding, in advance of stated maturity, the Prior Bonds.

B. The execution and delivery of this Indenture and the issuance and sale of the Bonds have been in all respects duly and validly authorized by proper action duly adopted by the governing authority of the Issuer.

C. The execution and delivery of the Bonds and of this Indenture have been duly authorized and all things necessary to make the Bonds, when executed by the Issuer and authenticated by the Trustee, valid and binding legal obligations of the Issuer and to make this Indenture a valid and binding agreement have been done.

NOW, THEREFORE, THIS TRUST INDENTURE WITNESSETH:

GRANTING CLAUSES

The Issuer, in consideration of the premises and the acceptance by the Trustee of the trusts hereby created and of the purchase and acceptance of the Bonds by the Owners thereof, and for other good and valuable consideration, the receipt of which is hereby acknowledged, in order to secure the payment of the principal of, and premium, if any, and interest on, the Bonds according to their tenor and effect and to secure the performance and observance by the Issuer of all the covenants expressed or implied herein and in the Bonds, does hereby grant, bargain, sell convey, mortgage and warrant, and assign, pledge and grant a security interest in, the Trust Estate to the Trustee, and its successors in trust and assigns forever for the benefit of the Owners:

TO HAVE AND TO HOLD all and singular the Trust Estate, whether now owned or hereafter acquired, to the Trustee and its respective successors in trust and assigns forever;

IN TRUST NEVERTHELESS, upon the terms and trusts herein set forth for the equal and proportionate benefit, security and protection of all present and future Owners of the Bonds issued under and secured by this Indenture without privilege, priority or distinction as to the lien or otherwise of any of the Bonds over any of the other Bonds;

PROVIDED, HOWEVER, that if the Issuer, its successors or assigns, shall well and truly pay, or cause to be paid, the principal of, and premium, if any, and interest on, the Bonds due or to become due thereon, at the times and in the manner mentioned in the Bonds and as provided in Article VIII hereof according to the true intent and meaning thereof, and shall cause the payments to be made as required under Article V hereof, or shall provide, as permitted hereby, for the payment thereof in accordance with Article VIII hereof, and shall well and truly keep, perform and observe all the covenants and conditions pursuant to the terms of this Indenture to be kept, performed and observed by it, and shall pay, or cause to be paid, the principal of, and premium, if any, and interest on, the Bonds due or to become due in accordance with the terms and provisions hereof, then and in that case this Indenture and the rights hereby granted shall cease, terminate and be void and the Trustee shall thereupon cancel and discharge this Indenture and execute and deliver to the Issuer, the Company and the Provider such instruments in writing as shall be requisite to evidence the discharge hereof, otherwise this Indenture shall be and remain in full force and effect.

THIS TRUST INDENTURE FURTHER WITNESSETH, and it is expressly declared, that all Bonds issued and secured hereunder are to be issued, authenticated and delivered, and all of the Trust Estate is to be dealt with and disposed of, under, upon and subject to the terms, conditions, stipulations, covenants, agreements, trusts, uses and purposes hereinafter expressed, and the Issuer has agreed and covenanted, and does hereby agree and covenant, with the Trustee and with the respective Owners, from time to time, of the Bonds, or any part thereof, as follows:

ARTICLE I

DEFINITIONS AND RULES OF CONSTRUCTION

Section 1.01. General Definitions . The terms defined in this Section 1.01 shall have the meanings provided herein for all purposes of this Indenture and the Agreement, unless the context clearly requires otherwise.

"Act" means Sections 90-5-101 to 90-5-114, inclusive, Montana Code Annotated, as from time to time supplemented and amended.

"Additional Collateral" means any form of collateral delivered by the Company pursuant to Section 4.09 of the Agreement.

"Agreement" or "Loan Agreement" means the Loan Agreement, dated as of December 1, 2008, between the Issuer and the Company, as amended and supplemented from time to time.

"Authorized Company Representative" means each person at the time designated to act on behalf of the Company by written certificate furnished to the Issuer, the Provider and the Trustee containing the specimen signature of such person and signed on behalf of the Company by its President, any Vice President, its Secretary, any Assistant Secretary, its Treasurer or any Assistant Treasurer. Such certificate may designate an alternate or alternates.

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"Authorized Denomination" means (i) $100,000 or any integral multiple of $5,000 in excess of $100,000 when the Bonds bear interest at a Daily Interest Rate, a Weekly Interest Rate or a Flexible Interest Rate; and (ii) $5,000 or any integral multiple of $5,000 when the Bonds bear interest at a Term Interest Rate.

"Available Moneys" means (a) during such time as a Credit Facility is in effect, (i) moneys on deposit in trust with the Trustee as agent and bailee for the Owners of the Bonds for a period of at least 123 days prior to and during which no petition in bankruptcy or similar insolvency proceeding has been filed by or against the Company or the Issuer (or any subsidiary of the Company, any guarantor of the Company or any insider (as defined in the United States Bankruptcy Code), to the extent that such moneys were deposited by any of such subsidiary, guarantor or insider) or is pending (unless such petition shall have been dismissed and such dismissal shall be final and not subject to appeal) and (ii) (A) proceeds of the issuance of refunding bonds (including proceeds from the investment thereof), and (B) any other moneys, if, in the written opinion of nationally recognized counsel experienced in bankruptcy matters selected by the Company (which opinion shall be in a form acceptable to the Trustee, to Moody’s, if the Bonds are then rated by Moody’s, and to S&P, if the Bonds are then rated by S&P and shall be delivered to the Trustee at or prior to the time of the deposit of such proceeds with the Trustee), the deposit and use of such proceeds (referred to in clause (A) above) or other moneys (referred to in clause (B) above) will not constitute a voidable preference under Section 547 of the United States Bankruptcy Code in the event either the Issuer or the Company were to become a debtor under the United States Bankruptcy Code, and (b) at any time that a Credit Facility is not in effect, any moneys on deposit with the Trustee as agent and bailee for the Owners of the Bonds and proceeds from the investment thereof.

"Bank" means Bank of America, N.A., as the Provider of the initial Credit Facility.

"Beneficial Owner" has, when the Bonds are held in book-entry form, the meaning ascribed to such term in Section 2.15 hereof.

"Bond" or "Bonds" means the Issuer’s Pollution Control Revenue Refunding Bonds (Avista Corporation Colstrip Project) Series 2008, issued pursuant to this Indenture.

"Bond Counsel" means Chapman and Cutler LLP or any other firm of nationally recognized bond counsel familiar with the type of transactions contemplated under this Indenture selected by the Company.

"Bond Documents" means this Indenture, the Agreement and the Bonds.

"Bond Fund" means the trust fund by that name created pursuant to Section 6.01(a) hereof.

"Bond Payment Date" means any Interest Payment Date and any other date on which the principal of, and premium, if any, and interest on, the Bonds is to be paid to the Owners thereof, whether upon redemption, at maturity or upon acceleration of maturity of the Bonds.

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"Bond Resolution" means the resolution duly adopted and approved by the City Council of the Issuer on December 8, 2008, authorizing the issuance and sale of the Bonds and the execution of this Indenture and the Agreement.

"Business Day" means any day except a Saturday, Sunday or other day (a) on which commercial banks located in the cities in which the Principal Office of the Provider, the Principal Office of the Trustee, the Principal Office of the Company, the Principal Office of the Remarketing Agent or the Principal Office of the Paying Agent are located are required or authorized by law or regulation to remain closed or are closed, or (b) on which The New York Stock Exchange is closed.

"Change of Credit Facility" means (a) the delivery of a Credit Facility (or evidence thereof) to the Trustee, (b) the termination of an existing Credit Facility or (c) a combination of (a) and (b), in each case in accordance with Section 4.07 of the Agreement.

"Closing" and "Closing Date" means the date of the first authentication and delivery of fully-executed and authenticated Bonds under this Indenture.

"Code" means the Internal Revenue Code of 1986, as amended. Each reference to a section of the Code herein shall be deemed to include the United States Treasury Regulations, including temporary and proposed regulations, relating to such section which are applicable to the Bonds or the use of the proceeds thereof.

"1954 Code" means the Internal Revenue Code of 1954, as amended. Each reference to a section of the 1954 Code herein shall be deemed to include the United States Treasury Regulations, including temporary and proposed regulations, relating to such section which are applicable to the Bonds or the use of the proceeds thereof.

"Company" means Avista Corporation, a corporation organized and existing under the laws of the State of Washington and formerly known as The Washington Water Power Company, or its successors and assigns pursuant to Section 5.01 of the Agreement.

"Company Mortgage" means (a) with respect to First Mortgage Bonds, the Mortgage and Deed of Trust, dated as of June 1, 1939, between the Company and the Company Mortgage Trustee, as heretofore and hereafter supplemented and amended, and (b) with respect to any Additional Collateral, references herein and in the Agreement to the Company Mortgage shall instead mean the mortgage and deed of trust or other agreement pursuant to which the Additional Collateral is issued, except as may be otherwise provided in a Supplemental Indenture entered into pursuant to Section 12.01(q) hereof or a supplement to the Agreement entered into pursuant to Section 12.05(l) hereof.

"Company Mortgage Trustee" means Citibank, N.A., formerly First National City Bank (successor by merger to First National City Trust Company, formerly City Bank Farmers Trust Company), its successors in trust and their assigns. Upon delivery of any Additional Collateral that is not First Mortgage Bonds, references herein and in the Agreement to the Company Mortgage Trustee shall instead mean the trustee with respect to such Additional Collateral,

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except as may be otherwise provided in a Supplemental Indenture entered into pursuant to Section 12.01(q) hereof or a supplement to the Agreement entered into pursuant to Section 12.05(l) hereof.

"Company Supplemental Indenture" means a supplemental indenture supplementing the Company Mortgage and providing for the issuance of First Mortgage Bonds or Additional Collateral, as the case may be.

"Credit Facility" means a facility provided in accordance with Section 4.07 of the Agreement to provide security or liquidity for the Bonds. The term "Credit Facility" includes, by way of example and not of limitation, one or more letters of credit, bond insurance policies, standby bond purchase agreements, lines of credit, First Mortgage Bonds, other Company mortgage bonds and other security instruments or liquidity devices. A Credit Facility may have an expiration date earlier than the maturity of the Bonds. The initial Credit Facility is the Letter of Credit.

"Credit Facility Agreement" means any agreement between the Company and the Provider and relating to the Credit Facility then in effect. The initial Credit Facility Agreement is that Letter of Credit and Reimbursement Agreement, dated as of December 1, 2008 between Bank of America, N.A. and the Company.

"Credit Facility Fund" means the trust fund by that name created pursuant to Section 6.01(b) hereof.

"Daily Interest Rate" means the interest rate on the Bonds established pursuant to Section 2.03 hereof.

"Daily Interest Rate Period" means each period during which a Daily Interest Rate is in effect.

"Delivery Office of the Trustee" means the office designated as such by the Trustee in writing to the Remarketing Agent, the Registrar, the Issuer, the Provider and the Company.

"Determination of Taxability" shall have the meaning set forth in Section 8.03 of the Agreement. The Trustee shall give notice of a Determination of Taxability as provided in Section 10.05 hereof.

"DTC" means The Depository Trust Company and its successors and assigns.

"DTC Participants" means those brokers, securities dealers, banks, trust companies, clearing corporations and certain other organizations from time to time for which DTC holds Bonds as securities depository.

"DTC Representation Letter" has the meaning assigned thereto in Section 2.15(c) hereof.

"Due for Payment" has the meaning specified in the Credit Facility.

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"Eligible Account" means an account that is either (a) maintained with a federal or state-chartered depository institution or trust company that has a S&P short-term debt rating of at least A-2 (or, if no short-term debt rating, a long-term debt rating of at least BBB+); or (b) maintained with the corporate trust department of a federal depository institution, trust company or state-chartered depository institution subject to regulations regarding fiduciary funds on deposit, which, in either case, has corporate trust powers and is acting in its fiduciary capacity. In the event that an account required to be an "Eligible Account" no longer complies with the requirement, the Trustee should promptly (and, in any case, within not more than 30 calendar days) move such account to another financial institution such that the Eligible Account requirement will again be satisfied.

"Event of Default" means any occurrence or event specified in Section 9.01 hereof

"Executive Officer" means the Mayor of the Issuer.

"Exempt Facilities" means facilities which qualify as "sewage or solid waste disposal facilities" or "air or water pollution control facilities" as defined in the 1954 Code and which qualify as a "project" under the Act.

"Favorable Opinion of Bond Counsel" means an opinion of Bond Counsel addressed to the Issuer and the Trustee to the effect that the proposed action is not prohibited by the Act or the Indenture or the Loan Agreement, as applicable, and will not adversely affect the Tax-Exempt status of the Bonds. The Favorable Opinion of Bond Counsel may be in such form and with such disclosures that such opinion will not be treated as a "covered opinion" for purposes of the Treasury Department Regulations governing practice before the Internal Revenue Service (Circular 230), 31 CFR Part 10.

"First Mortgage Bonds" means a series of first mortgage bonds issued and delivered under the Company Mortgage, and held by the Trustee as Additional Collateral, a Credit Facility, or both, as may be designated in writing to the Trustee by an Authorized Company Representative at the time the Company delivers such First Mortgage Bonds to the Trustee.

"Flexible Interest Rate" means, with respect to any Bond, the interest rate or rates associated with such Bond established in accordance with Section 2.06 hereof.

"Flexible Interest Rate Period" means each period comprised of Flexible Segments during which Flexible Interest Rates are in effect.

"Flexible Segment" means, with respect to each Bond bearing interest at a Flexible Interest Rate, the period established in accordance with Section 2.06(a) hereof.

"Government Obligations" means direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed as to full and timely payment by, the United States of America, which are not subject to redemption or prepayment prior to stated maturity.

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"Indenture" means this Trust Indenture between the Issuer and the Trustee relating to issuance of the Bonds, as amended or supplemented from time to time as permitted herein.

"Information Services" means Financial Information, Inc.’s "Daily Called Bond Service," 30 Montgomery Street, 10th Floor, Jersey City, New Jersey 07302, Attention: Editor; Standard & Poor’s J. J. Kenny’s "Called Bond Service," 55 Water Street, 45th Floor, New York, New York 10041; Mergent’s "Municipal and Government Manual," 60 Madison Avenue, New York, New York 10010, Attention: Customer Service and the Municipal Securities Rulemaking Board, CDI, 1900 Duke Street, Alexandria, Virginia 22314, Attention: MSIL Dept.; or, in accordance with then-current guidelines of the Securities and Exchange Commission, such other addresses and/or such other services providing information with respect to called bonds, or no such services, as the Company may designate in a certificate delivered to the Trustee.

"Interest Account" means the trust account by that name established in the Bond Fund pursuant to Section 6.01 hereof.

"Interest Component" means the maximum amount stated in the Credit Facility (as reduced and reinstated from time to time in accordance with the terms thereof), which may be drawn upon with respect to payment of accrued interest in accordance with Section 2.16(a) hereof or the portion of the purchase price of Bonds delivered pursuant to Section 3.01 and Section 3.02 hereof corresponding to interest accrued on the Bonds on or prior to the stated maturity thereof.

"Interest Coverage Rate" means the interest rate specified in a Credit Facility as being the rate used to determine the amount of interest on the Bonds covered by such Credit Facility.

"Interest Coverage Period" means the number of days specified in the Credit Facility, as the case may be, initially 35 days, which is used to determine the Interest Component.

"Interest Payment Date" means:

(a) with respect to any Daily or Weekly Interest Rate Period, the first Business Day of each calendar month,

(b) with respect to any Term Interest Rate Period, any day in the sixth month following the commencement of the Term Interest Rate Period and any day in each sixth month thereafter, each as designated by the Company,

(c) with respect to any Flexible Segment, the Business Day next succeeding the last day of such Flexible Segment, and

(d) with respect to any Rate Period, the day next succeeding the last day thereof.

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"Investment Securities" means any of the following obligations or securities, to the extent permitted by law and subject to the provisions of Article VII hereof, on which neither the Company nor any of its subsidiaries is the obligor.

(a) Government Obligations;

(b) Obligations of any of the following federal agencies, which obligations represent the full faith and credit of the United States of America:

(c) Direct obligations of any of the following federal agencies which obligations are not fully guaranteed by the full faith and credit of the United States of America:

(d) U.S. dollar denominated deposit accounts, federal funds, trust funds, trust accounts, interest bearing deposits, interest bearing money market accounts, time deposits, overnight bank deposits, demand deposits and bankers’ acceptances with domestic commercial banks (including the Trustee or any of its affiliates) which have a rating on their short term certificates of deposit on the date of purchase of "A-1" or "A-1+" by S&P and "P-1" by Moody’s and maturing no more than 360 days after the date of purchase. (Ratings on holding companies are not considered as the rating of the bank.);

(e) Commercial paper which is rated at the time of purchase in the single highest classification, "A-1+" by S&P and "P-1" by Moody’s and which matures not more than 270 days after the date of purchase;

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(f) Investments in a money market mutual fund rated having a rating in the highest investment category granted thereby from S&P or Moody’s, including, without limitation any mutual fund for which the Trustee or an affiliate of the Trustee serves as investment manager, administrator, shareholder servicing agent, and/or custodian or subcustodian, notwithstanding that (i) the Trustee or an affiliate of the Trustee receives fees from funds for services rendered, (ii) the Trustee collects fees for services rendered pursuant to this Indenture, which fees are separate from the fees received from such funds, and (iii) services performed for such funds and pursuant to this Indenture may at times duplicate those provided to such funds by the Trustee or an affiliate of the Trustee;

(g) Pre-refunded Municipal Obligations defined as follows: Any bonds or other obligations of any state of the United States of America or of any agency, instrumentality or local governmental unit of any such state which are not callable at the option of the obligor prior to maturity or as to which irrevocable instructions have been given by the obligor to call on the date specified in the notice; and

(1) which are rated, based on an irrevocable escrow account or fund (the "escrow" ), in the highest rating category of S&P and Moody’s or any successors thereto; or

(2) (i) which are fully secured as to principal and interest and redemption premium, if any, by an escrow consisting only of cash or Government Obligations, which escrow may be applied only to the payment of such principal of and interest and redemption premium, if any, on such bonds or other obligations on the maturity date or dates thereof or the specified redemption date or dates pursuant to such irrevocable instructions, as appropriate, and (ii) which escrow is sufficient, as verified by a nationally recognized independent certified public accountant, to pay principal of and interest and redemption premium, if any, on the bonds or other obligations described in this clause (g) on the maturity date or dates specified in the irrevocable instructions referred to above, as appropriate;

(h) General obligations of states with a rating of at least "A2/A" or higher by both Moody’s and S&P;

(i) Investment agreements approved in writing by the Provider supported by opinions of counsel to the investment agreement provider with notice to Moody’s and S&P; and

(j) Other forms of investments (including repurchase or reverse repurchase agreements, including those of the Trustee or any of its affiliates) approved in writing by the Provider with notice to Moody’s and S&P.

"Issue Date" means the date of the initial authentication and delivery of the Bonds, being December 30, 2008.

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"Issuer" means the City of Forsyth, Montana, and its successors, and any political subdivision resulting from or surviving any consolidation or merger to which it or its successors may be a party.

"Letter of Credit" means an irrevocable letter of credit issued by the Bank to the Trustee pursuant to the terms of the initial Credit Facility Agreement.

"Loan Payments" means the payments required to be made by the Company pursuant to Section 4.01(a) of the Agreement.

"Mail" means by first-class mail postage prepaid.

"Maturity Date" means March 1, 2034.

"Maximum Interest Rate" means (a) while a Credit Facility is in effect that specifies an Interest Coverage Rate, the lesser of 18% per annum or the Interest Coverage Rate specified in the Credit Facility, and (b) at all other times, 18% per annum.

"Moody’s" means Moody’s Investors Service, a corporation organized and existing under the laws of the State of Delaware, its successors and assigns, and, if such corporation shall for any reason no longer perform the functions of a securities rating agency, "Moody’s" shall be deemed to refer to any other nationally recognized rating agency designated by the Company by notice to the Issuer, the Trustee and the Remarketing Agent.

"Outstanding" or "Bonds Outstanding" or "Outstanding Bonds" means, as of any given date, all Bonds which have been authenticated and delivered by the Trustee under this Indenture, except:

(a) Bonds canceled or purchased by or delivered to the Trustee for cancellation;

(b) Bonds that have become due (at maturity or on redemption, acceleration or otherwise) and for the payment, including premium if any, and interest accrued to the due date, of which sufficient moneys are held by the Trustee;

(c) Bonds deemed paid in accordance with Section 6.04 and Article VIII hereof; and

(d) Bonds in lieu of which others have been authenticated under Section 2.10 (relating to transfer and exchange of Bonds) or Section 2.12 (relating to mutilated, lost, stolen, destroyed or undelivered Bonds) or Bonds paid pursuant to Section 2.12;

provided, however, that if the principal of or interest due on Bonds is paid by the Provider pursuant to the Credit Facility, such Bonds shall remain Outstanding for all purposes of this Indenture until the Provider receives payment therefor as contemplated by the Credit Facility.

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Bonds purchased by the Trustee or the Company pursuant to Article III hereof will continue to be Outstanding until the Company has paid or caused to be paid to the Trustee an amount sufficient to provide for the payment of all accrued interest on such Bonds and the Company has directed the Trustee to cancel such Bonds. Bonds purchased pursuant to tenders and not delivered to the Trustee for payment are not Outstanding, but there will be Outstanding Bonds authenticated and delivered in lieu of such undelivered Bonds as contemplated by Section 3.03 hereof.

"Owner" or "Owners" or "Owner of Bonds" or "Owners of Bonds" means the registered owner of any Bond; provided however, when used in the context of the Tax-Exempt status of the Bonds, the term "Owners" shall include a Beneficial Owner.

"Paying Agent" means any paying agent appointed as provided in Section 10.23 hereof, or any successor thereto.

"Person" means one or more individuals, estates, joint ventures, joint-stock companies, partnerships, associations, corporations, limited liability companies, trusts or unincorporated organizations, and one or more governments or agencies or political subdivisions thereof.

"Plant" means the Colstrip Plant Units 3 and 4 coal-fired steam electric generating plant, located in Rosebud County, Montana.

"Pledged Bonds" means Bonds purchased with moneys drawn under the Credit Facility following the tender thereof pursuant to Section 3.01 or Section 3.02 hereof to be deemed owned by the Company for purposes of granting a first priority lien upon Pledged Bonds hereunder, registered in the name of the Provider, as pledgee, or in the name of the Trustee (or its nominee), as agent for the Provider, delivered to or upon the direction of the Provider pursuant to Section 3.06(a)(iii) hereof.

"Pollution Control Facilities" means those items of machinery, equipment, structures, improvements, other facilities and related property, which have been or will be acquired, constructed and improved at the Plant and are particularly described in Exhibit A to the Agreement, as said Exhibit A may be from time to time amended.

"Principal Account" means the trust account by that name established within the Bond Fund pursuant to Section 6.01 hereof.

"Principal Office of the Company" means the office of the Company specified in or designated pursuant to Section 3.06(c) hereof.

"Principal Office of the Paying Agent" means the office designated in writing by the Paying Agent (which may or may not be its principal corporate office) to the Trustee, the Issuer, the Company, the Registrar, the Provider and the Remarketing Agent.

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"Principal Office of the Provider" means the office of the Provider located in the United States of America and designated as the Principal Office of the Provider by the Provider in writing to the Company, the Issuer, the Registrar, the Remarketing Agent and the Trustee.

"Principal Office of the Registrar" means the office or offices designated as such by the Registrar (which may or may not be its principal corporate office) in writing to the Trustee, the Company, the Issuer, the Provider and the Remarketing Agent.

"Principal Office of the Remarketing Agent" means the office designated in writing by the Remarketing Agent to the Trustee, the Issuer, the Company, the Provider, the Registrar and the Paying Agent.

"Principal Office of the Trustee" means the office designated as such by the Trustee (which may or may not be its principal corporate office) in writing to the Remarketing Agent, the Registrar, the Provider, the Issuer and the Company.

"Prior Agreement" means the Loan Agreement between the Issuer and the Company, dated as of September 1, 1999, as amended and restated as of May 1, 2005, pursuant to which the Company is obligated to provide for payment of the Prior Bonds.

"Prior Bond Fund" means the bond fund created under Section 6.01(b) of the Prior Indenture from which payments of principal and interest on the Prior Bonds are made.

"Prior Bonds" means the City of Forsyth, Montana, Pollution Control Revenue Refunding Bonds (Avista Corporation Colstrip Project) Series 1999B which are being refunded pursuant to the Refunding with the proceeds of the Bonds.

"Prior Indenture" means the Trust Indenture between the Issuer and the Prior Trustee, dated as of September 1, 1999, as amended and restated as of May 1, 2005, pursuant to which the Prior Bonds were issued.

"Prior Trustee" means The Bank of New York Mellon Trust Company, N.A., as successor trustee under the Prior Indenture.

"Project" means the Company’s 15% undivided interest in the Pollution Control Facilities.

"Project Certificate" means the Company’s certificate or certificates, delivered concurrently with the initial authentication and delivery of the Bonds, with respect to certain facts which are within the knowledge of the Company to enable Bond Counsel to determine whether interest on the Bonds is includible in the gross income of the Owners thereof under applicable provisions of the Code.

"Provider" and "Provider of the Credit Facility" means the provider of the Credit Facility. The initial Provider is the Bank.

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"Provider Default" means any of the following events:

(a) the failure of the Provider to make any payment required under the Credit Facility when the same shall become due and payable or the Credit Facility shall for any reason cease to be in full force and effect;

(b) a decree or order for relief shall be entered by a court or insurance regulatory authority having jurisdiction over the Provider in an involuntary case under an applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or appointing a receiver, liquidator, custodian, trustee, sequestrator (or similar official) of the Provider or for any substantial part of the property of the Provider or ordering the winding-up or liquidation of the affairs of the Provider, and the continuance of any such decree or order shall be unstayed and remain in effect for a period of 60 consecutive days thereafter; or

(c) the Provider shall commence a voluntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or the Provider shall consent to or acquiesce in the entry of an order for relief in an involuntary case under any such law, or the Provider shall consent to the appointment of or taking of possession by a receiver, liquidator, trustee, custodian, sequestrator (or similar official) of the Provider or for any substantial part of its property, or the Provider shall make a general assignment for the benefit of creditors, or the Provider shall fail generally or admit in writing its inability to pay its debts as such debts become due, or the Provider shall take corporate action in contemplation or furtherance of any of the foregoing.

"Rate" means any Daily Interest Rate, Weekly Interest Rate, Flexible Interest Rate or Term Interest Rate.

"Rate Period" means any Daily Interest Rate Period, Weekly Interest Rate Period, Flexible Interest Rate Period or Term Interest Rate Period.

"Rating Category" means one of the generic rating categories of either Moody’s or S&P, without regard to any refinement or gradation of such rating category by a numerical modifier or otherwise.

"Rebate Fund" means the trust fund by that name created pursuant to Section 6.01(c) hereof.

"Record Date" means:

(a) with respect to any Interest Payment Date in respect of any Daily Interest Rate Period, Weekly Interest Rate Period or Flexible Segment, the Business Day next preceding such Interest Payment Date,

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(b) with respect to any Interest Payment Date in respect of any Term Interest Rate Period (except as provided in clause (d) below), the fifteenth day of the month preceding such Interest Payment Date, and

(c) for any Interest Payment Date established pursuant to clause (d) of the definition of "Interest Payment Date" in this Section 1.01 in respect of a Term Interest Rate Period, the Business Day next preceding such Interest Payment Date.

"Redemption Date" means December 31, 2008, the date upon which the Prior Bonds are to be redeemed.

"Refunding" means the series of transactions whereby the Prior Bonds are refunded and cancelled with the proceeds of the Bonds and other money provided by the Company.

"Registrar" means the Trustee or any successor Registrar appointed in accordance with Section 10.22.

"Remarketing Agent" means any Person serving from time to time as Remarketing Agent under this Indenture.

"Remarketing Agreement" means the remarketing agreement between the Company and the Remarketing Agent pursuant to which the Remarketing Agent agrees to act as Remarketing Agent for the Bonds, as such remarketing agreement may be amended and supplemented from time to time.

"Responsible Officer" means, when used with respect to the Trustee, the president, any vice president, any assistant vice president, the secretary, any assistant secretary, the treasurer, any assistant treasurer or any other officer of the Trustee within the Principal Office of the Trustee (or any successor corporate trust office) customarily performing functions similar to those performed by the persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred at the Principal Office of the Trustee because of such person’s knowledge of and familiarity with the particular subject and having direct responsibility for the administration of this Indenture.

"Revenues" means all moneys pledged hereunder and paid or payable to the Trustee for the account of the Issuer in accordance with the Agreement, the First Mortgage Bonds and the Credit Facility, and all receipts credited under the provisions of this Indenture against such payments; provided however, that "Revenues" shall not include moneys held by the Trustee in the Rebate Fund or to pay the purchase price of Bonds subject to purchase pursuant to Article III hereof.

"S&P" means Standard & Poor’s Ratings Services, a Division of The McGraw-Hill Companies, Inc., a corporation organized and existing under the laws of the State of New York, its successors and assigns, and, if such corporation shall for any reason no longer perform the functions of a securities rating agency, "S&P" shall be deemed to refer to any other nationally

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recognized securities rating agency designated by the Company by notice to the Issuer, the Trustee and the Remarketing Agent.

"Securities Depositories" The Depository Trust Company, Call Notification Department, 55 Water Street, 50th Floor, New York, New York 10041-0099, Fax: (212) 855-7232, -7233, -7234, or -7235; or, in accordance with then-current guidelines of the Securities and Exchange Commission, such other addresses and/or such other securities depositories, or no such depositories, as the Company may designate in a certificate delivered to the Trustee.

"SIFMA Swap Index" means, on any date, a rate determined on the basis of the seven-day high grade market index of tax-exempt variable rate demand obligations, as produced by Municipal Market Data, Inc., and published or made available by the Securities Industry & Financial Markets Association (formerly the Bond Market Association) ( "SIFMA" ) or any person acting in cooperation with or under the sponsorship of SIFMA and effective from such date; provided, however, that if such index is no longer provided by Municipal Market Data, Inc. or its successor, the "SIFMA Swap Index" shall mean such other reasonably comparable index selected by the Remarketing Agent.

"State" means the State of Montana.

"Supplemental Indenture" means any indenture supplemental to this Indenture entered into between the Issuer and the Trustee pursuant to the provisions of Section 12.01 or Section 12.02 hereof.

"Tax Certificate" means the Tax Exemption Certificate and Agreement relating to the Bonds to be executed by the Company, the Issuer and the Trustee on the date of the initial authentication and delivery of the Bonds, as amended and supplemented from time to time.

"Tax-Exempt" means, with respect to interest on any obligations of a state or local government, including the Bonds, that such interest is excludable from in gross income of the owners of such obligations for federal income tax purposes, except for interest on any such obligations for any period during which such obligations are owned by a person who is a "substantial user" of any facilities financed or refinanced with such obligations or a "related person" within the meaning Section 103(b)(13) of the Internal Revenue Code of 1954, whether or not such interest is includible as an item of tax preference or otherwise includible directly or indirectly for purposes of calculating other tax liabilities, including any alternative minimum tax or environmental tax under the Code.

"Term Interest Rate" means the interest rate on the Bonds established in accordance with Section 2.05 hereof.

"Term Interest Rate Period" means each period of six months or more during which a Term Interest Rate is in effect.

"Treasury Regulations" means the United States Treasury Regulations dealing with the tax-exempt bond provisions of the Code.

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"Trustee" means The Bank of New York Mellon Trust Company, N.A., as trustee under this Indenture, and any successor Trustee appointed hereunder.

"Trust Estate" means all right, title and interest of the Issuer in and to the Agreement (except for amounts payable to, and the rights of, the Issuer under Section 4.04, Section 4.06(a), Section 5.03, Section 5.06, Section 5.07, Section 5.08 and Section 7.05 thereof, and, prior to an Event of Default, the Issuer’s right to give approvals and consents thereunder, and the Issuer’s right to receive notices, certificates, requests, requisitions, directions and other communications thereunder), including, without limitation, all right, title and interest of the Issuer in the Revenues, any Credit Facility and any Additional Collateral held by the Trustee, all moneys and other obligations which are, from time to time, deposited or required to be deposited with or held or required to be held by or on behalf of the Trustee in trust in the Bond Fund under any of the provisions of this Indenture (except moneys or obligations deposited with or paid to the Trustee for payment or redemption of Bonds that are deemed no longer Outstanding hereunder), the Credit Facility, and all other rights, title and interest which are subject to the lien of this Indenture; provided , however , that the "Trust Estate" shall not include (a) moneys held by the Trustee in the Rebate Fund or to pay the purchase price of Bonds subject to purchase pursuant to Article III hereof or (b) the Plant, the Pollution Control Facilities, the Project or any part thereof.

"Wall Street Journal" means The Wall Street Journal or any other newspaper or journal printed in the English language and customarily published on each business day devoted to financial news and selected by the Trustee, whose decision shall be final.

"Weekly Interest Rate" means the interest rate on the Bonds established in accordance with Section 2.04 hereof.

"Weekly Interest Rate Period" means each period during which a Weekly Interest Rate is in effect.

Section 1.02. Rules of Construction . Unless the context otherwise requires:

(a) an accounting term not otherwise defined has the meaning assigned to it in accordance with generally accepted accounting principles;

(b) references to Articles and Sections are to the Articles and Sections of this Indenture or the Agreement, as the case may be;

(c) words importing the singular number shall include the plural number and vice versa and words importing the masculine shall include the feminine and vice versa; and

(d) the headings and Table of Contents herein are solely for convenience of reference and shall not constitute a part of this Indenture nor shall they affect its meanings, construction or effect.

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ARTICLE II

THE BONDS

Section 2.01. Authorization and Terms of Bonds . (a) There is hereby authorized and created under this Indenture an issue of bonds designated as City of Forsyth, Montana, Pollution Control Revenue Refunding Bonds (Avista Corporation Colstrip Project) Series 2008. The total aggregate principal amount of Bonds that may be issued and Outstanding under this Indenture is expressly limited to $17,000,000 exclusive of Bonds executed and authenticated as provided in Section 2.07 hereof; provided however , that no Bonds shall be delivered hereunder until the Trustee receives a request and authorization of the Issuer signed by the Executive Officer to authenticate and deliver the principal amount of the Bonds therein specified to the purchaser or purchasers therein identified upon payment to the Prior Trustee, for the account of the Issuer, of the sum specified in such request and authorization.

(b) The Bonds shall be issued as registered Bonds, without coupons, in Authorized Denominations and shall all be dated as of the Issue Date. The Bonds shall mature, subject to prior redemption as provided in Article IV hereof, upon the terms and conditions hereinafter set forth, on the Maturity Date. The Bonds shall bear interest at the rate or rates determined as provided in this Article II.

(c) The Bonds shall be numbered consecutively from 1 upward. Each Bond shall bear interest from the Interest Payment Date next preceding the date of registration and authentication thereof unless it is registered and authenticated on or prior to the first Interest Payment Date, in which event it shall bear interest from the Issue Date; provided, however, that if, as shown by the records of the Paying Agent, interest on the Bonds shall be in default, Bonds issued in exchange for Bonds surrendered for registration of transfer or exchange shall bear interest from the last date to which interest has been paid in full or duly provided for on the Bonds, or, if no interest has been paid or duly provided for on the Bonds, from the Issue Date. Payment of the interest on any Bond shall be made to the person appearing on the bond registration books of the Registrar as the registered Owner thereof on the Record Date, such interest to be paid by the Paying Agent to such registered Owner, as follows:

(1) in respect of any Bond which is registered in the book-entry system pursuant to Section 2.15 hereof, in immediately available funds by no later than 2:30 p.m., New York, New York time, and

(2) in respect of any Bond which is not registered in the book-entry system pursuant to Section 2.15 hereof, (i) by bank check mailed by first-class mail on the Interest Payment Date, to such Owner’s address as it appears on the registration books of the Registrar or at such other address as has been furnished to the Registrar in writing by such Owner, or (ii) during any Rate Period other than a Term Interest Rate Period, in immediately available funds on the Interest Payment Date (by wire transfer or by deposit to the account of the Owner of any such Bond if such account is maintained with the Paying Agent), but in respect of any Owner of Bonds during a Daily Interest Rate Period,

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a Weekly Interest Rate Period or a Flexible Interest Rate Period, only to any Owner which owns Bonds in an aggregate principal amount of at least $1,000,000 on the Record Date, according to the written instructions given by such Owner to the Paying Agent or, if no such instructions have been provided as of the Record Date, by bank check mailed by first-class mail on the Interest Payment Date to the Owner at such Owner’s address as it appears as of the Record Date on the registration books of the Registrar, except, in each case, that, if and to the extent that there shall be a default in the payment of the interest due on such Interest Payment Date, such defaulted interest shall be paid to the Owners in whose name any such Bonds are registered as of a special record date to be fixed by the Trustee, notice of which shall be given to such Owners not less than ten (10) days prior thereto.

Both the principal of and premium, if any, on the Bonds shall be payable upon surrender thereof in lawful money of the United States of America at the Principal Office of the Paying Agent. Notwithstanding the foregoing, interest on any Bond bearing a Flexible Interest Rate and not registered in the book-entry system pursuant to Section 2.15 hereof shall be paid only upon presentation to the Trustee of the Bond on which such payment is due.

Section 2.02. Interest Rates and Rate Periods . (a)  General. The Bonds shall bear interest from and including the Issue Date until final payment of the principal or redemption price thereof shall have been made or provided for in accordance with the provisions hereof, whether at maturity, upon redemption or otherwise, at the lesser of (A) the Maximum Interest Rate or (B) the interest rate or rates determined as provided in this Article II. Such rate or rates shall be effective for the periods set forth in this Article II. During any Rate Period other than a Term Interest Rate Period, interest on the Bonds shall be computed upon the basis of a 365- or 366-day year, as applicable, for the number of days actually elapsed. During any Term Interest Rate Period, interest on the Bonds shall be computed upon the basis of a 360-day year, consisting of twelve 30-day months. Notwithstanding any other provision of this Indenture, it shall not be required that all Bonds bear interest at the same rate, provided that only one Rate Period may apply to the Bonds. Not later than 11:15 a.m. (New York, New York time) on the Business Day immediately following the day on which there has been a change in the rate of interest applicable to the Bonds, the Remarketing Agent shall give notice of such change to the Trustee by facsimile or electronic mail. The Trustee hereby agrees to give telephonic notice to the Company, promptly confirmed in writing (which may be by electronic mail or facsimile), on each Record Date of the amount of interest to be due and payable on the Bonds on the next succeeding Interest Payment Date.

(b) Rate Periods. The term of the Bonds shall be divided into consecutive Rate Periods during which the Bonds shall bear interest at the Daily Interest Rate, Weekly Interest Rate, Term Interest Rate or at Flexible Interest Rates. During the initial Rate Period, the Bonds shall bear interest at a Daily Rate.

(c) Initial Rate Period. The Bonds shall initially bear interest at the Daily Rate of 1.25%. Thereafter, the Bonds shall bear interest as provided herein.

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(d) Determination Conclusive . The determination of each Flexible Interest Rate, Daily Interest Rate, Weekly Interest Rate and Term Interest Rate and each Flexible Segment by the Remarketing Agent shall be conclusive and binding upon such parties, the Trustee, the Paying Agent, the Issuer, the Company, the Owners of the Bonds and the Provider.

(e) Adjustment or Continuation of Rate Period. At any time, the Company, by written notice to the Issuer, the Trustee, the Paying Agent, the Provider and the Remarketing Agent may, subject to Section 2.02(g), elect that the Bonds shall bear interest at a different Rate or, in the case of a Term Interest Rate Period, shall continue to bear interest at a Term Interest Rate. Such notice (A) shall specify the effective date of such adjustment to a different Rate, which shall be (1) a Business Day not earlier than the fifteenth day following the fifth Business Day after the date of receipt by the Trustee and the Paying Agent of such notice (or the fifteenth day following such shorter period after the date of such receipt as shall be acceptable to the Trustee), and (2) a day on which the Bonds would be permitted to be redeemed at the option of the Company pursuant to Section 4.02(b) hereof, and; provided, however, that if prior to the Company’s mailing of notice of such election, any Bonds shall have been called for redemption and such redemption shall not have theretofore been effected, the effective date of the new Rate Period shall not precede such redemption date; and (B) if the adjustment is (1) from a Term Interest Rate Period having a duration in excess of one year or (2) to a Term Interest Rate Period, unless such Term Interest Rate Period immediately succeeds a Term Interest Rate Period of the same duration and is subject to the same optional redemption rights under Section 4.02(b)(iii) hereof, shall be accompanied by a Favorable Opinion of Bond Counsel with respect to such adjustment; provided that, in the case of an adjustment to a Flexible Interest Rate Period, the Favorable Opinion of Bond Counsel described in clause (B) above, if required, shall be reaffirmed as of the effective date of such adjustment.

(f) Notice of Adjustment or Continuation of Rate Period. The Trustee shall give notice by Mail of an adjustment to a different Rate Period or the continuation of a Term Interest Rate Period to the Owners not less than 15 days prior to the effective date of such Rate Period. Such notice shall state (A) that the interest rate on the Bonds will be adjusted to a different Rate or, in the case of a Term Interest Rate Period, will continue to bear interest at a Term Interest Rate (subject to the Company’s ability to rescind its election as provided in Section 2.07 hereof), (B) the effective date of such adjustment or continuation, (C) that such Bonds are subject to mandatory purchase on such effective date, (D) the procedures for such mandatory purchase, (E) the purchase price of such Bonds on such effective date (expressed as a percentage of the principal amount thereof), and (F) that the Owners of such Bonds do not have the right to retain their Bonds on such effective date.

(g) Adjustments Subject to Compliance With Credit Facility Agreement. The Bonds shall not be adjusted from one Rate Period to a different Rate Period unless any applicable conditions precedent to such adjustment specified in the Credit Facility Agreement (unless a Provider Default shall have occurred and be continuing) have been satisfied.

Section 2.03. Daily Interest Rate . During each Daily Interest Rate Period, the Bonds shall bear interest at the Daily Interest Rate determined by the Remarketing Agent on each Business Day for such Business Day. The Daily Interest Rate shall be the rate determined by the

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Remarketing Agent (based on an examination of Tax-Exempt obligations comparable to the Bonds known by the Remarketing Agent to have been priced or traded under then-prevailing market conditions) to be the lowest rate which would enable the Remarketing Agent to sell the Bonds on the effective date of such rate at a price (without regard to accrued interest) equal to 100% of the principal amount thereof. If the Remarketing Agent shall not have determined a Daily Interest Rate for any day by 9:30 a.m., New York, New York time, the Daily Interest Rate for such day shall be 100% of the most recent SIFMA Swap Index. The Remarketing Agent shall notify the Company, the Trustee, the Provider and the Paying Agent of each Daily Interest Rate on the date of the determination thereof by written notice communicated by electronic mail, by facsimile or by other means acceptable to the Company, the Trustee, the Provider and the Paying Agent.

Section 2.04. Weekly Interest Rate . During each Weekly Interest Rate Period, the Bonds shall bear interest at the Weekly Interest Rate determined by the Remarketing Agent no later than the first day of such Weekly Interest Rate Period and thereafter no later than Tuesday of each week during such Weekly Interest Rate Period, unless any such Tuesday shall not be a Business Day, in which event the Weekly Interest Rate shall be determined by the Remarketing Agent no later than the Business Day next preceding such Tuesday. The Weekly Interest Rate shall be the rate determined by the Remarketing Agent (based on an examination of Tax-Exempt obligations comparable to the Bonds known by the Remarketing Agent to have been priced or traded under then prevailing market conditions) to be the lowest rate which would enable the Remarketing Agent to sell the Bonds on the effective date of such rate at a price (without regard to accrued interest) equal to 100% of the principal amount thereof. If the Remarketing Agent shall not have determined a Weekly Interest Rate for any period, the Weekly Interest Rate shall be 110% of the most recent SIFMA Swap Index. The first Weekly Interest Rate determined for each Weekly Interest Rate Period shall apply to the period commencing on the first day of such Weekly Interest Rate Period and ending on the next succeeding Tuesday. Thereafter, each Weekly Interest Rate shall apply to the period commencing on each Wednesday and ending on the next succeeding Tuesday, unless such Weekly Interest Rate Period shall end on a day other than Tuesday, in which event the last Weekly Interest Rate for such Weekly Interest Rate Period shall apply to the period commencing on the Wednesday preceding the last day of such Weekly Interest Rate Period and ending on such last day. The Remarketing Agent shall notify the Company, the Trustee, the Provider and the Paying Agent of each Weekly Interest Rate on the date of the determination thereof by written notice communicated by electronic mail, by facsimile or by other means acceptable to the Company, the Trustee, and the Paying Agent.

Section 2.05. Term Interest Rate . (a)  Determination of Term Interest Rate. During each Term Interest Rate Period, the Bonds shall bear interest at the Term Interest Rate determined by the Remarketing Agent on a Business Day selected by the Remarketing Agent, but not more than 60 days prior to and not later than the effective date of such Term Interest Rate Period. The Term Interest Rate shall be the rate determined by the Remarketing Agent on such date as being the lowest rate (based on an examination of Tax-Exempt obligations comparable to the Bonds known by the Remarketing Agent to have been priced or traded under then prevailing market conditions) which would enable the Remarketing Agent to sell the Bonds on the effective date of such Term Interest Rate Period at a price (without regard to accrued interest) equal to 100% of the principal amount thereof , provided however, that if, for any reason, a Term Interest Rate for

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any Term Interest Rate Period shall not be determined or become effective, then (A) in the event the then-current Term Interest Rate Period is for one year or less, the Rate Period for the Bonds shall automatically adjust to a Daily Interest Rate Period and (B) in the event the current Term Interest Rate Period is for more than one year, the Rate Period for the Bonds shall automatically adjust to a Term Interest Rate Period of one year and one day; provided, however, that if the last day of any successive Term Interest Rate Period shall not be a day immediately preceding a Business Day, then such successive Term Interest Rate Period shall end on the first day immediately preceding the Business Day next succeeding such day or, if such Term Interest Rate Period would end after the day prior to the final maturity date of the Bonds, the next succeeding Rate Period shall be a Term Interest Rate Period ending on the day prior to the final maturity date of the Bonds; provided further that in the case of clause (B) above, if the Company delivers to the Trustee a Favorable Opinion of Bond Counsel prior to the end of the then-effective Term Interest Rate Period, the Rate Period for the Bonds will adjust to a Daily Interest Rate Period. If the Daily Interest Rate for the first day of a Daily Interest Rate Period described in clause (A) above is not determined as provided in Section 2.03(a) hereof the Daily Interest Rate for the first day of such Daily Interest Rate Period shall be 110% of the most recent SIFMA Swap Index. If a Term Interest Rate for any such Term Interest Rate Period described in clause (B) above is not determined as described in the first sentence of this Section 2.05(a), the Term Interest Rate for such Term Interest Rate Period shall be 110% of the most recent One-Year Note Index theretofore published in The Bond Buyer (or, if The Bond Buyer is no longer published or no longer publishes the One-Year Note Index, the one-year note index contained in the publication determined by the Remarketing Agent, or, if the Remarketing Agent is the Trustee, determined by the Company, as the most comparable to The Bond Buyer ). The Remarketing Agent shall notify the Company, the Trustee, the Provider and the Paying Agent of each Term Interest Rate on the date of the determination thereof by written notice communicated by electronic mail, by facsimile or by other means acceptable to the Company, the Trustee, the Provider and the Paying Agent.

(b) Automatic Adjustment to Daily Interest Rate Period or Continuation of Term Interest Rate Period. If, by 15 days prior to the end of the then-current Term Interest Rate Period, the Trustee shall not have received notice of the Company’s election that the Bonds shall bear interest at a Daily Interest Rate, a Weekly Interest Rate, a Term Interest Rate or a Flexible Interest Rate, (A) in the event the then-current Term Interest Rate Period is for one year or less, the Rate Period for the Bonds shall automatically adjust to a Daily Interest Rate Period and (B) in the event the current Term Interest Rate Period is for more than one year, the Rate Period for the Bonds shall automatically adjust to a Term Interest Rate Period of one year and one day, provided however, that if the last day of any successive Term Interest Rate Period shall not be a day immediately preceding a Business Day, then such successive Term Interest Rate Period shall end on the first day immediately preceding the Business Day next succeeding such day or, if such Term Interest Rate Period would end after the day prior to the Maturity Date, the next succeeding Rate Period shall be a Term Interest Rate Period ending on the day prior to the Maturity Date; provided however, that in the case of clause (B) above, if the Company delivers to the Trustee a Favorable Opinion of Bond Counsel prior to the end of the then-effective Term Interest Rate Period, the Rate Period for the Bonds will adjust to a Daily Interest Rate Period. If the Daily Interest Rate for the first day of a Daily Interest Rate Period described in clause (A) above is not determined as provided in Section 2.03(a) hereof, the Daily Interest Rate for the first

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day of such Daily Interest Rate Period shall be 110% of the most recent SIFMA Swap Index. If a Term Interest Rate for any such Term Interest Rate Period described in clause (B) above is not determined as described in the first sentence of this Section 2.05(a), the Term Interest Rate for such Term Interest Rate Period shall be 110% of the most recent One-Year Note Index theretofore published in The Bond Buyer (or, if The Bond Buyer is no longer published or no longer publishes the One-Year Note Index, the one-year note index contained in the publication determined by the Remarketing Agent, or, if the Remarketing Agent is the Trustee, determined by the Company, as the most comparable to The Bond Buyer ).

(c) Successive Term Interest Rate Periods; Alternate Optional Redemption Provisions. At the same time that the Company elects to have the Bonds bear interest at a Term Interest Rate or to continue to bear interest at a Term Interest Rate, the Company may also elect that such Term Interest Rate Period shall be automatically renewed for successive Term Interest Rate Periods each having the same duration as the Term Interest Rate Period so specified; provided however, that such election must be accompanied by a Favorable Opinion of Bond Counsel with respect to such continuing automatic renewals of such Term Interest Rate Period. If such election is made, no Favorable Opinion of Bond Counsel shall be required in connection with the commencement of each successive Term Interest Rate Period determined in accordance with such election. Further, at the same time that the Company elects to have the Bonds bear interest at a Term Interest Rate or continue to bear interest at a Term Interest Rate, subject to the provisions of Section 4.02(c) hereof the Company may also specify to the Trustee optional redemption prices and periods different from those set out in Section 4.02 hereof during the Term Interest Rate Period(s) with respect to which such election is made.

(d) Consecutive Term Interest Rate Periods. At the time the Company so elects an adjustment to or continuation of a Term Interest Rate Period, the Company may specify two or more consecutive Term Interest Rate Periods.

Section 2.06. Flexible Interest Rate . (a)  Determination of Flexible Segments and Flexible Interest Rates. During each Flexible Interest Rate Period, each Bond shall bear interest during each Flexible Segment for such Bond at the Flexible Interest Rate for such Bond as described herein. Each Flexible Segment and Flexible Interest Rate for each Bond shall be the Flexible Segment and Flexible Interest Rate determined by the Remarketing Agent. Each Flexible Segment for any Bond shall be a period of not less than one nor more than 270 days (subject to any limitations set forth in the Remarketing Agreement), determined by the Remarketing Agent to be, in its judgment, the period which, together with all other Flexible Segments for the Bonds then outstanding, is likely to result in the lowest overall net interest expense on the Bonds; provided however, that (A) any such Bond purchased on behalf of the Company and remaining unsold in the hands of the Remarketing Agent as of the close of business on the effective date of the Flexible Segment for such Bond shall have a Flexible Segment of one day or, if such Flexible Segment would not end on a day immediately preceding a Business Day, a Flexible Segment of more than one day ending on the day immediately preceding the next Business Day and (B) each Flexible Segment shall end on a day which immediately precedes a Business Day and no Flexible Segment shall extend beyond the final maturity date of the Bonds.

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The Flexible Interest Rate for each Flexible Segment for each Bond shall be the rate determined by the Remarketing Agent (based on an examination of Tax-Exempt obligations comparable to the Bonds known by the Remarketing Agent to have been priced or traded under then prevailing market conditions) no later than the first day of such Flexible Segment (and in the case of a Flexible Segment of one day, no later than 12:30 p.m. New York, New York time, on such date) to be the lowest rate which would enable the Remarketing Agent to sell the Bonds on the effective date of such rate at a price (without regard to accrued interest) equal to 100% of the principal amount thereof. If a Flexible Segment or a Flexible Interest Rate for a Flexible Segment is not determined or effective, the Flexible Segment for such Bond shall be a Flexible Segment of one day, and the interest rate for such Flexible Segment of one day shall be 110% of the most recent SIFMA Swap Index. The Remarketing Agent shall notify the Company, the Trustee, the Provider and the Paying Agent of each Flexible Interest Rate and Flexible Segment on the date of the determination thereof by written notice communicated by electronic mail, by facsimile or by other means acceptable to the Company, the Trustee, the Provider and the Paying Agent.

(b) Special Provisions for an Adjustment From Flexible Interest Rates. If at any time during a Flexible Interest Rate Period, the Company elects, pursuant to Section 2.02(e) that the Bonds shall no longer bear interest at Flexible Interest Rates and shall instead bear interest as otherwise permitted under this Indenture, the Company shall notify the Issuer, the Trustee, the Paying Agent, the Provider and the Remarketing Agent of such election by Mail and shall instruct the Remarketing Agent to determine Flexible Segments of such duration that, as soon as possible, all Flexible Segments shall end on the same date, not earlier than the day that would permit the notice required by Sections 2.02(f) to be given, and such date shall be the last day of the then current Flexible Interest Rate Period. Upon the establishment of such Flexible Segments, the day next succeeding the last day of all such Flexible Segments shall be the effective date of the Rate Period elected by the Company. The Remarketing Agent, promptly upon the determination thereof, shall give written notice of such last day and such effective dates to the Issuer, the Company, the Trustee and the Paying Agent.

Section 2.07. Rescission of Election . Notwithstanding anything herein to the contrary, the Company may rescind any election by it to adjust to or, in the case of a Term Interest Rate Period, continue a Rate Period pursuant to Section 2.02(e) hereof prior to the effective date of such adjustment or continuation, by giving written notice thereof to the Issuer, the Trustee, the Paying Agent, the Provider and the Remarketing Agent prior to such effective date. At the time that the Company gives notice of rescission, it may also elect in such notice to continue the Rate Period then in effect; provided however, that if the Rate Period then in effect is a Term Interest Rate Period, the subsequent Term Interest Rate Period shall not be of a different duration than the Term Interest Rate Period then in effect unless the Company provides to the Trustee a Favorable Opinion of Bond Counsel prior to the expiration of the then-current Term Interest Rate Period. If the Trustee receives notice of such rescission prior to the time the Trustee has given notice to the Owners of the Bonds of the change in or continuation of Rate Periods pursuant to Section 2.02(f) hereof, then such notice of change in or continuation of Rate Periods shall be of no force and effect and shall not be given to the Owners. If the Trustee receives notice of such rescission after the Trustee has given notice to the Owners of the Bonds pursuant to Section 2.02(f) hereof of an adjustment from any Rate Period other than a Term Interest Rate

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Period in excess of one year or if an attempted adjustment from one Rate Period (other than a Term Interest Rate Period in excess of one year) to another Rate Period does not become effective for any other reason, and if the Company does not elect to continue the Rate Period then in effect, then the Rate Period for the Bonds shall automatically adjust to or continue in a Daily Interest Rate Period and the Trustee shall promptly give notice thereof to the Owners of the Bonds. If the Trustee receives notice of such rescission after the Trustee has given notice to the Owners of the Bonds pursuant to Section 2.02(f) hereof of an adjustment from a Term Interest Rate Period in excess of one year to another Rate Period (including a Term Interest Rate Period of a different duration), or if an attempted adjustment from a Term Interest Rate Period in excess of one year to another Rate Period (including a Term Interest Rate Period of a different duration) does not become effective for any reason and if the Company does not elect to continue the Rate Period then in effect, then the Rate Period for the Bonds shall continue to be a Term Interest Rate Period of the same duration as the immediately preceding Term Interest Rate Period, subject to the second proviso contained in Section 2.05(a); provided that if the Company delivers to the Trustee a Favorable Opinion of Bond Counsel prior to the end of the then-effective Term Interest Rate Period, the Rate Period for the Bonds shall be as directed by the Company in writing. If a Daily Interest Rate for the first day of any Daily Interest Rate Period to which a Rate Period is adjusted under this Section 2.07 is not determined as provided in Section 2.03(a) hereof, the Daily Interest Rate for the first day of such Daily Interest Rate Period shall be 110% of the most recent SIFMA Swap Index . The Trustee shall promptly give written notice of each such automatic adjustment to a Rate Period pursuant to this Section 2.07 to the Owners in the form provided in Section 2.02(f) hereof.

Notwithstanding the rescission by the Company of any notice to adjust to or from or continue a Rate Period, if notice has been given to Owners pursuant to Section 2.02(f), the Bonds shall be subject to mandatory purchase as specified in such notice.

Section 2.08. Form of Bonds . The Bonds and the certificate of authentication to be executed thereon shall be in substantially the form attached hereto as Exhibit A , with such appropriate variations, omissions and insertions as are permitted or required by this Indenture. Upon adjustment to a Term Interest Rate Period, the form of Bond may include a summary of the mandatory and optional redemption provisions to apply to the Bonds during such Term Interest Rate Period, or a statement to the effect that the Bonds will not be optionally redeemed during such Term Interest Rate Period; provided that the Registrar shall not authenticate such a revised Bond form prior to receiving a Favorable Opinion of Bond Counsel that such Bond form satisfies the requirements of the Act and of this Indenture and that authentication thereof will not adversely affect the Tax-Exempt status of the Bonds.

Section 2.09. Execution of Bonds . The Bonds shall be signed in the name and on behalf of the Issuer with the manual or facsimile signature of its Mayor and attested by the manual or facsimile signature of the City Clerk. The Bonds shall then be delivered to the Registrar for authentication by it. In case any officer who shall have signed any of the Bonds shall cease to be such officer before the Bonds so signed or attested shall have been authenticated or delivered by the Registrar or issued by the Issuer, such Bonds may nevertheless be authenticated, delivered and issued and, upon such authentication, delivery and issuance, shall be as binding upon the Issuer as though those who signed and attested the same had continued to be such officers of the

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Issuer. Also, any Bond may be signed on behalf of the Issuer by such persons as on the actual date of the execution of such Bond shall be the proper officers although on the nominal date of such Bond any such person shall not have been such officer.

Only such of the Bonds as shall bear thereon a certificate of authentication in the form set forth in Exhibit A hereto, manually executed by an authorized signatory of the Registrar, shall be valid or obligatory for any purpose or entitled to the benefits of this Indenture, and such certificate of the Registrar shall be conclusive evidence that the Bonds so authenticated have been duly authenticated and delivered hereunder and are entitled to the benefits of this Indenture.

Upon authentication of any Bond, the Registrar shall set forth on such Bond (1) the date of such authentication and (2) in the case of a Bond bearing interest at a Flexible Interest Rate and not registered in the book-entry system pursuant to Section 2.15 hereof, such Flexible Interest Rate, the last day of the applicable Flexible Segment, the number of days comprising such Flexible Segment and the amount of interest to accrue during such Flexible Segment.

Section 2.10. Transfer and Exchange of Bonds . Registration of any Bond may, in accordance with the terms of this Indenture, be transferred at the Principal Office of the Registrar, upon the books of the Registrar required to be kept pursuant to the provisions of Section 2.11 hereof, by the Person in whose name it is registered, in person or by its attorney duly authorized in writing, upon surrender of such Bond for cancellation, accompanied by a written instrument of transfer in a form approved by the Registrar, duly executed. The Registrar shall require the payment by the Owner of the Bond requesting such transfer of any tax or other governmental charge required to be paid and there shall be no other charge to any Owners for any such transfer. Whenever any Bond shall be surrendered for registration of transfer, the Issuer shall execute and the Registrar shall authenticate and deliver a new Bond or Bonds of the same tenor and of Authorized Denominations. Except with respect to Bonds purchased pursuant to Sections 3.01 and 3.02 hereof, no registration of transfer of Bonds shall be required to be made for a period of fifteen (15) days next preceding the date on which the Trustee Mails any notice of redemption, nor shall any registration of transfer of Bonds called for redemption be required, except the unredeemed portion of any Bond being redeemed in part.

Bonds may be exchanged at the Principal Office of the Registrar for a like aggregate principal amount of Bonds of the same tenor and of Authorized Denominations. The Registrar shall require the payment by the Owner of the Bond requesting such exchange of any tax or other governmental charge required to be paid with respect to such exchange, and there shall be no other charge to any Owners for any such exchange. Except with respect to Bonds purchased pursuant to Section 3.01 and Section 3.02 hereof, no exchange of Bonds shall be required to be made for a period of fifteen (15) days next preceding the date on which the Trustee provides notice of redemption in accordance with Section 4.05 hereof, nor shall any exchange of Bonds called for redemption be required, except the unredeemed portion of any Bond being redeemed in part.

The Issuer, the Registrar, the Trustee and any agent of the Issuer, the Registrar or the Trustee may treat the person in whose name the Bond is registered as the owner thereof for the purpose of receiving payment as herein provided and for all other purposes, whether or not the

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Bond be overdue, and neither the Issuer, the Registrar, the Trustee, any paying agent nor any such agent shall be affected by notice to the contrary.

Section 2.11. Bond Register . The Registrar will keep or cause to be kept at its Principal Office sufficient books for the registration and the registration of transfer of the Bonds, which shall at all times, during regular business hours, be open to inspection by the Issuer, the Trustee, the Provider, the Remarketing Agent and the Company; and, upon presentation for such purpose, the Registrar shall under such reasonable regulations as it may prescribe, register the transfer or cause to be registered the transfer, on said books, Bonds as hereinbefore provided.

Section 2.12. Bonds Mutilated, Lost, Destroyed or Stolen . If any Bond shall become mutilated, the Issuer, upon the request and at the expense of the Owner of said Bond, shall execute, and the Registrar shall thereupon authenticate and deliver, a new Bond of like tenor and number in exchange and substitution for the Bond so mutilated, but only upon surrender to the Registrar of the Bond so mutilated. Every mutilated Bond so surrendered to the Registrar shall be canceled by it and delivered to the Company. If any Bond issued hereunder shall be lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Issuer, the Company and the Registrar, and if such evidence shall be satisfactory to them and indemnity satisfactory to them shall be given, the Issuer, at the expense of the Owner, shall execute, and the Registrar shall thereupon authenticate and deliver, a new Bond of like tenor in lieu of and in substitution for the Bond so lost, destroyed or stolen (or if any such Bond shall have matured or shall be about to mature, instead of issuing a substitute Bond the Registrar may pay the same without surrender thereof). The Issuer may require payment of a reasonable fee for each new Bond issued under this Section and payment of the expenses which may be incurred by the Issuer and the Registrar. Any Bond issued under the provisions of this Section in lieu of any Bond alleged to be lost, destroyed or stolen shall constitute an original additional contractual obligation on the part of the Issuer whether or not the Bond so alleged to be lost, destroyed or stolen be at any time enforceable by anyone, and shall be equally and proportionately entitled to the benefits of this Indenture with all other Bonds secured by this Indenture.

To the extent permitted by law, the provisions of this Section are exclusive and shall preclude all other rights and remedies with respect to the replacement or payment of mutilated, lost, destroyed or stolen Bonds.

Section 2.13. Bonds; Limited Obligations . The Bonds, together with premium, if any, and interest thereon, shall be limited and not general obligations of the Issuer not constituting or giving rise to a pecuniary liability of the Issuer nor any charge against its general credit or taxing powers nor an indebtedness of or a loan of credit thereof within the meaning of any provision or limitation of the State Constitution or laws, shall be payable solely from the Revenues and other moneys pledged therefor under this Indenture, and shall be a valid claim of the respective Owners thereof only against the Bond Fund, the Revenues and other moneys held by the Trustee as part of the Trust Estate. The Issuer shall not be obligated to pay the purchase price of Bonds from any source.

THE BONDS SHALL NOT BE DEEMED TO CONSTITUTE A DEBT, LIABILITY OR GENERAL OBLIGATION OF THE ISSUER, THE STATE OR OF ANY POLITICAL SUBDIVISION THEREOF, OR A

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PLEDGE OF THE FAITH AND CREDIT OF THE ISSUER, THE STATE OR OF ANY SUCH POLITICAL SUBDIVISION, BUT SHALL BE PAYABLE SOLELY FROM THE REVENUES AND PROCEEDS PROVIDED THEREFOR. THE ISSUER SHALL NOT BE OBLIGATED TO PAY THE SAME NOR INTEREST THEREON EXCEPT FROM THE REVENUES AND PROCEEDS PLEDGED THEREFOR, AND NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE ISSUER, THE STATE OR OF ANY POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF OR THE INTEREST ON THE BONDS.

No recourse shall be had for the payment of the principal of, or premium, if any, or interest on any of the Bonds or for any claim based thereon or upon any obligation, covenant or agreement contained in this Indenture, the Bonds, the Agreement or any other related documents, against any past, present or future officer, elected official agent or employee of the Issuer, or any incorporator, officer, director or member of any successor corporation, as such, either directly or through the Issuer or any successor corporation, under any rule of law or equity, statute or constitution or by the enforcement of any assessment or penalty or otherwise, and all such liability of any such incorporator, officer, director or member as such is hereby expressly waived and released as a condition of and in consideration for the execution of this Indenture and the issuance of any of the Bonds.

Section 2.14. Disposal of Bonds . Upon payment of the principal of, premium, if any, and interest represented thereby or transfer or exchange pursuant to Section 2.10 hereof or, replacement pursuant to Section 2.12 hereof, any Bond shall be canceled and such Bond shall be disposed of by the Registrar in accordance with its customary procedures and the Registrar shall provide evidence satisfactory to the Company of such cancellation and disposition.

Section 2.15. Book-Entry System . (a) Unless otherwise determined by the Issuer, the Bonds shall be issued in the form of a single certificated fully-registered Bond, registered in the name of Cede & Co., as nominee of DTC, or any successor nominee (the "Nominee" ). The actual owners of the Bonds (the "Beneficial Owners" ) will not receive physical delivery of Bond certificates except as provided herein. Except as provided in paragraph (d) below, all of the outstanding Bonds shall be so registered in the registration books kept by the Registrar, and the provisions of this Section shall apply thereto.

(b) With respect to Bonds registered on the registration books kept by the Registrar in the name of the Nominee, the Issuer, the Company, the Paying Agent, the Registrar, the Trustee and the Remarketing Agent shall have no responsibility or obligation to any DTC Participant or the Beneficial Owners. Without limiting the immediately preceding sentence, the Issuer, the Company, the Paying Agent, the Registrar, the Trustee and the Remarketing Agent shall have no responsibility or obligation to DTC, any DTC Participant or any Beneficial Owner with respect to (1) the accuracy of the records of DTC, the Nominee or any DTC Participant with respect to any ownership interest in the Bonds, (2) the delivery by DTC or any DTC Participant of any notice with respect to the Bonds, including any notice of redemption, or (3) the payment to any DTC Participant or Beneficial Owner of any amount with respect to principal or purchase price of, or premium, if any, or interest on, the Bonds. The Issuer, the Company, the Paying Agent, the Registrar, the Trustee and the Remarketing Agent may treat and consider the person in whose name each Bond is registered in the registration books kept by the Registrar as the owner and

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absolute owner of such Bond for the purpose of payment of principal purchase price, premium and interest with respect to such Bond, for the purpose of giving notices of redemption and other matters with respect to such Bond, for the purpose of registering transfers with respect to such Bond, and for all other purposes whatsoever. The Paying Agent shall pay all principal of and premium if any, and interest on, the Bonds only to or upon the order of the respective Owners, as shown in the registration books kept by the Registrar, or their respective attorneys duly authorized in writing, and all such payments shall be valid and effective to fully satisfy and discharge the Issuer’s obligations with respect to payment of principal of, and premium, if any, and interest on, the Bonds to the extent of the sum or sums so paid. No person other than an Owner, as shown in the registration books kept by the Registrar, shall receive a certificated Bond evidencing the obligation of the Issuer to make payments of principal, premium, if any, and interest pursuant to this Indenture.

(c) The Issuer, the Paying Agent, the Remarketing Agent and the Trustee shall execute and deliver to DTC a letter of representations in customary form with respect to the Bonds in book-entry form (the "DTC Representation Letter" ), but such DTC Representation Letter shall not in any way limit the provisions of the foregoing paragraph (b) or in any other way impose upon the Issuer, the Trustee or the Paying Agent any obligation whatsoever with respect to persons having interests in the Bonds other than the Owners, as shown on the registration books kept by the Registrar. The Trustee, the Remarketing Agent and the Paying Agent shall take all action necessary for all representations of the Issuer in the DTC Representation Letter with respect to the Trustee, the Remarketing Agent and the Paying Agent to be complied with at all times, including but not limited to, the giving of all notices required under the DTC Representation Letter. The Trustee and Paying Agent are hereby authorized by the Issuer to enter into the DTC Representation Letter.

(d) DTC may determine to discontinue providing its services with respect to the Bonds at any time by giving reasonable notice to the Issuer or the Trustee and discharging its responsibilities with respect thereto under applicable law. The Issuer, with the consent of the Company, may terminate the services of DTC with respect to the Bonds. Upon the discontinuance or termination of the services of DTC with respect to the Bonds, unless a substitute securities depository is appointed to undertake the functions of DTC hereunder, the Issuer, at the expense of the Company, is obligated to deliver Bond certificates to the Beneficial Owners of such Bonds, as described in this Indenture, and such Bonds shall no longer be restricted to being registered in the registration books kept by the Registrar in the name of the Nominee, but may be registered in whatever name or names Owners transferring or exchanging Bonds shall designate, in accordance with the provisions of this Indenture.

(e) Notwithstanding any other provision of this Indenture to the contrary, so long as any Bond is registered in the name of the Nominee, all payments with respect to principal or purchase price of or, premium if any, and interest on such Bond and all notices with respect to such Bond shall be made and given, respectively, in the manner provided in the DTC Representation Letter. Owners shall have no lien or security interest in any rebate or refund paid by DTC to the Paying Agent which arises from the payment by the Paying Agent of principal of, or premium, if any, or interest on, the Bonds in immediately available funds to DTC.

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(f) So long as any Bond is held in book-entry form a Beneficial Owner (through its DTC Participant) shall give notice to the Trustee to elect to have its Bonds purchased, and shall effect delivery of such Bonds by causing such DTC Participant to transfer its interest in the Bonds equal to such Beneficial Owner’s interest on the records of DTC to the Trustee’s participant account with DTC. The requirement for physical delivery of the Bonds in connection with any purchase pursuant to Section 3.01 and Section 3.02 hereof shall be deemed satisfied when the ownership rights in the Bonds are transferred by DTC Participants on the records of DTC to the Trustee’s participant account.

Section 2.16. Credit Facility Provisions . So long as the Credit Facility shall be in effect, the Trustee, Registrar and Paying Agent shall observe the following provisions respecting the Credit Facility:

(a) During such time as a Credit Facility is in effect, the Trustee shall draw upon the Credit Facility in accordance with its terms in an amount which, together with moneys referred to in Section 6.03(c)(i) and 6.03(d)(i) hereof, will be sufficient, together with any moneys then on deposit in the Credit Facility Fund, to pay, on any Bond Payment Date, principal of and interest on the Bonds. The Trustee shall draw moneys under the Credit Facility in accordance with Section 3.06(c) hereof and in accordance with its terms to ensure timely payment thereof to the extent necessary to pay to the Trustee the purchase price of Bonds delivered or deemed to be delivered to the Trustee in accordance with Sections 3.01 or 3.02 hereof. In no event shall the Trustee draw upon the Credit Facility to make any payment of principal or purchase price of or interest on Pledged Bonds or Bonds held of record by or, to the extent that the Company notified a Responsible Officer of the Trustee in writing of such ownership, on behalf of the Company or any subsidiary or affiliate of the Company.

Immediately following a drawing under the Credit Facility and not as a condition to such drawing, the Trustee shall give telephonic, electronic mail or facsimile notice to the Company that such a drawing under the Credit Facility was made.

(b) If at any time there shall cease to be any Bonds Outstanding hereunder, the Trustee shall promptly surrender the Credit Facility then in effect to the Provider thereof in accordance with the terms thereof and of this Indenture for cancellation. Following a Change of Credit Facility, the Trustee shall promptly after such Change surrender the Credit Facility which has been changed to the Provider thereof, in accordance with the terms thereof and of this Indenture, for cancellation; provided, however, that the Trustee shall only surrender such Credit Facility after all draws on such Credit Facility pursuant to Section 3.02(c) hereof have been honored by the Provider thereof.

(c) In the event Bonds are to be purchased pursuant to Section 3.02(a)(iii) hereof due to a Change of Credit Facility, the notice of mandatory purchase shall be given by the Trustee in accordance with Section 3.08 hereof. If, prior to the fifth day next preceding the date fixed for a mandatory purchase pursuant to Section 3.02(a)(iii) hereof, subsequent to the giving of such notice pursuant to Section 3.08 hereof, the term of the existing Credit Facility shall have been extended or the Company notifies the Trustee that

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the delivery of an alternate Credit Facility or the termination of the then existing Credit Facility pursuant to Section 4.07 of the Agreement shall not occur, then the Trustee shall give notice of such extension of the term of the existing Credit Facility or that the delivery of an alternate Credit Facility or the termination of the then existing Credit Facility pursuant to Section 4.07 of the Agreement shall not occur, which notice shall specify (w) that the notice of a Change of Credit Facility has been given, (x) that subsequent to the giving of such notice the term of the existing Credit Facility has been extended or the Company has notified the Trustee that delivery of an alternate Credit Facility or the termination of the existing Credit Facility pursuant to Section 4.07 of the Agreement shall not occur, (y) the date that the term of the Credit Facility will expire and (z) that the mandatory purchase for which notice was given will not occur. Such notice that the term of the Credit Facility has been extended or that the Company has notified the Trustee that delivery of an alternate Credit Facility or the termination of the then existing Credit Facility pursuant to Section 4.07 of the Agreement shall not occur, shall be given by the Trustee by Mail to the Owners of the Bonds not more than five days following such extension or the receipt by the Trustee of such notice from the Company.

(d) The Trustee shall not sell, assign or otherwise transfer the Credit Facility or any interest in the Revenues except to a successor Trustee hereunder and in accordance with the terms of the Credit Facility or the Agreement, as the case may be.

(e) While a book-entry system is in effect for the Bonds, the Trustee shall give written notice of a Change of Credit Facility to DTC at least twenty (20) days prior to the effective date of the Change of Credit Facility. In the event that notice cannot be given within such twenty-day period, the Trustee shall provide such notice as soon as practicable.

(f) If the Credit Facility then in effect shall be an insurance policy, in addition to those rights granted the Provider under this Indenture, the Provider shall, to the extent it makes payment of principal of or interest on the Bonds, become subrogated to the rights of the recipients of such payments in accordance with the terms of the Credit Facility, and to evidence such subrogation (i) in the case of subrogation as to claims for past due interest, the Registrar shall note the Provider’s rights as subrogee on the registration books of the Issuer maintained by the Registrar upon receipt from the Provider of proof of the payment of interest thereon to the Owners, and (ii) in the case of subrogation as to claims for past due principal, the Registrar shall note the Provider’s rights as subrogee on the registration books of the Issuer maintained by the Registrar upon surrender of the Bonds by the Owners thereof, together with proof of the payment of principal thereof.

Section 2.17. CUSIP Numbers . The Issuer in issuing the Bonds may use "CUSIP" numbers (if then generally in use), and, if so, the Trustee shall use CUSIP numbers in notices of redemption as a convenience to Owners; provided that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Bonds or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Bonds, and any such redemption shall not be affected by

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any defect in or omission of such numbers. The Issuer or the Company will promptly notify the Trustee and the Registrar of any change in any CUSIP number(s).

Neither the Issuer, the Registrar nor the Trustee shall have any responsibility for any defect in the CUSIP number that appears on any Bond, check, advice of payment or redemption notice, and any such document may contain a statement to the effect that CUSIP numbers have been assigned by an independent service for convenience of reference and that neither the Issuer, the Registrar nor the Trustee shall be liable for any inaccuracy in such matters.

ARTICLE III

PURCHASE AND REMARKETING OF BONDS

Section 3.01. Owner’s Option to Tender for Purchase . (a)  Daily Interest Rate Period . During any Daily Interest Rate Period, any Bond or portion thereof in an Authorized Denomination shall be purchased at the option of the Owner thereof on any Business Day at a purchase price equal to 100% of the principal amount thereof plus accrued interest, if any, from the Interest Payment Date next preceding the date of purchase to the date of purchase (unless the date of purchase shall be an Interest Payment Date, in which case the purchase price shall be equal to the principal amount thereof), upon (i) delivery to the Trustee at the Delivery Office of the Trustee and to the Remarketing Agent at the Principal Office of the Remarketing Agent, by no later than 10:00 a.m., New York, New York time, on such Business Day, of an irrevocable written notice (which may be by facsimile or other writing) which states the principal amount and certificate number (if the Bonds are not then held in book-entry form) of such Bond and the date on which the same shall be purchased, and (ii) subject to Section 2.15(f) hereof and the last paragraph of Section 3.03 hereof, delivery of such Bond tendered for purchase to the Trustee at the Delivery Office of the Trustee, accompanied by an instrument of transfer thereof in a form satisfactory to the Trustee, executed in blank by the Owner thereof with the signature of such Owner guaranteed by a member or participant in a "signature guarantee program" as provided in the form of assignment attached to such Bond, at or prior to 1:00 p.m., New York, New York time, on the purchase date. The Trustee shall keep a written record of each notice described in clause (i) above.

(b) Weekly Interest Rate Period . During any Weekly Interest Rate Period, any Bond or portion thereof in an Authorized Denomination shall be purchased at the option of the Owner thereof on any Business Day at a purchase price equal to 100% of the principal amount thereof plus accrued interest, if any, from the Interest Payment Date next preceding the date of purchase to the date of purchase (unless the date of purchase shall be an Interest Payment Date, in which case the purchase price shall be equal to the principal amount thereof), upon (i) delivery to the Trustee at the Delivery Office of the Trustee of an irrevocable written notice (which may be by facsimile or other writing), by 5:00 p.m., New York, New York time, on any Business Day, which states the principal amount of such Bond and the certificate number (if the Bonds are not then held in book-entry form) and the date on which the same shall be purchased, which date shall not be prior to the seventh day next succeeding the date of the delivery of such notice to the Trustee, and (ii) subject to Section 2.15(f) hereof and the last paragraph of Section 3.03 hereof,

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delivery of such Bond to the Trustee at the Delivery Office of the Trustee, accompanied by an instrument of transfer thereof in a form satisfactory to the Trustee, executed in blank by the Owner thereof with the signature of such Owner guaranteed by a member or participant in a "signature guarantee program" as provided in the form of assignment attached to such Bond, at or prior to 1:00 p.m., New York, New York time, on the purchase date. The Trustee shall keep a written record of each notice described in clause (i) above.

(c) Term Interest Rate Period . Any Bond or portion thereof in an Authorized Denomination shall be purchased at the option of the Owner thereof on the first day of any Term Interest Rate Period which is preceded by a Term Interest Rate Period of equal duration at a purchase price equal to 100% of the principal amount thereof upon (x) delivery to the Trustee at the Delivery Office of the Trustee of an irrevocable notice in writing by 5:00 p.m., New York, New York time, on any Business Day not less than fifteen days before the purchase date, which states the principal amount and certificate number (if the Bonds are not then held in book-entry form) of such Bond to be purchased, and (y) subject to Section 2.15(f) hereof and the last paragraph of Section 3.03 hereof delivery of such Bond to the Trustee at the Delivery Office of the Trustee, accompanied by an instrument of transfer thereof in a form satisfactory to the Trustee, executed in blank by the Owner thereof with the signature of such Owner guaranteed by a member or participant in a "signature guarantee program" as provided in the form of assignment attached to such Bond, at or prior to 1:00 p.m. New York, New York time, on the purchase date. The Trustee shall keep a written record of each notice described in clause (x) above.

(d) If any Bond is to be purchased in part pursuant to Section 3.01(a), Section 3.01(b) or Section 3.01(c) hereof, the amount so purchased and the amount not so purchased must each be an Authorized Denomination.

Section 3.02. Mandatory Purchase . (a) The Bonds shall be subject to mandatory purchase at a purchase price equal to 100% of the principal amount thereof, plus accrued interest, if any, to the purchase date described below, upon the occurrence of any of the events stated below:

(i) as to any Bond, on the effective date of any change in a Rate Period with respect to such Bond, other than the effective date of a Term Interest Rate Period which was preceded by a Term Interest Rate Period of the same duration;

(ii) as to each Bond in a Flexible Interest Rate Period, on the Business Day next succeeding the last day of any Flexible Segment with respect to such Bond;

(iii) as to any Bond, on the date set forth in any notice of a Change of Credit Facility given by the Company pursuant to Section 4.07(b) of the Agreement, which shall be a date that is on or before the effective date of such Change of Credit Facility; provided, however, that if such Change of Credit Facility consists of the termination of the then existing Credit Facility, the purchase date shall be the Business Day immediately preceding such termination; provided, further, that if the Bonds are then subject to optional redemption pursuant to Section 4.02(b)(iii), the purchase price shall include any

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premium that would have been payable upon such redemption had the Bonds been redeemed;

(iv) as to any Bond, if a Credit Facility is in effect, on the second Business Day following the day that the Trustee receives notice from the Provider that, following a drawing on the Credit Facility on an Interest Payment Date for the payment of unpaid interest on the Bonds, the Credit Facility will not be reinstated in accordance with its terms;

(v) as to any Bond, if a Credit Facility is in effect, on the second Business Day following the day that the Trustee receives notice from the Provider directing such mandatory purchase upon the occurrence and continuance of an event of default under the Credit Facility Agreement; or

(vi) as to each Bond in a Daily Interest Rate Period or a Weekly Interest Rate Period, on any Business Day designated by the Company, with the consent of the Provider and the Remarketing Agent.

(b) When Bonds are called for redemption pursuant to Section 4.02(b)(iii) hereof and if the Company gives notice to the Trustee on or before the Business Day prior to the redemption date that the Company elects to have the Bonds purchased in lieu of redemption, all or any portion of the Bonds that the Company elects to purchase shall be subject to mandatory purchase on such redemption date at a purchase price equal to 100% of the principal amount thereof plus an amount equal to any premium that would have been payable upon such redemption had the Bonds been redeemed. If the Bonds are purchased in lieu of redemption on or prior to the applicable Record Date, the purchase price shall include accrued interest from the Interest Payment Date next preceding the date of purchase to the date of purchase (unless the date of purchase shall be an Interest Payment Date, in which case the purchase price shall be equal to the amount specified in the preceding sentence). If the Bonds are purchased in lieu of redemption after such Record Date, the purchase price shall not include accrued interest.

(c) The Trustee shall by 3:00 p.m., New York, New York time, on the Business Day preceding the day that the Bonds are subject to mandatory purchase pursuant to Section 3.02(a)(iii) draw on the then existing Credit Facility in an amount sufficient to pay the principal and interest which will be due on the purchase date and hold such amount uninvested and without any liability for interest until the purchase date when such amount shall be applied to pay the amounts due to the Owners of the Bonds on the purchase date.

(d) The Trustee shall (i) immediately following receipt of notice from the Provider pursuant to Section 3.02(a)(iv) or (ii) by 3:00 p.m., New York, New York time, on the Business Day preceding the day that the Bonds are subject to mandatory purchase pursuant to Section 3.02(a)(v), draw on that Credit Facility in an amount sufficient to pay the principal and interest which will be due on the purchase date and hold such amount uninvested and without any liability for interest until the purchase date when such amount shall be applied to pay the amounts due to the Owners of the Bonds on the purchase date.

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Section 3.03. Payment of Purchase Price . If Bonds are to be purchased pursuant to Section 3.01 or Section 3.02, the Trustee shall pay the purchase price of such Bonds but solely from the following sources in the order of priority indicated, and the Trustee shall not have any obligation to use funds from any other source:

(a) moneys which constitute Available Moneys and are furnished by the Company to the Trustee pursuant to Section 8.02 of the Agreement for purchase of Bonds;

(b) proceeds of the remarketing and sale of such Bonds (other than Bonds sold to the Company, any subsidiary or guarantor of the Company, or the Issuer or any "insider" (as defined in the United States Bankruptcy Code)) pursuant to Section 3.04 hereof and which proceeds are on deposit with the Trustee prior to 12:00 noon New York, New York time, on the purchase date;

(c) moneys (which constitute Available Moneys or moneys provided pursuant to the Credit Facility for the payment of the purchase price of the Bonds) furnished to the Trustee pursuant to Article VIII hereof, such moneys to be applied only to the purchase of Bonds which are deemed to be paid in accordance with Article VIII hereof;

(d) moneys furnished to the Trustee representing moneys provided pursuant to a Credit Facility for the payment of the purchase price of the Bonds; and

(e) any other moneys furnished by or on behalf of the Company to the Trustee for purchase of the Bonds, including, without limitation, any moneys from Additional Collateral;

provided, however, that funds for the payment of the purchase price of Bonds which are deemed to be paid in accordance with Article VIII hereof shall be derived only from the sources described in Section 3.03(c); provided, further, that if the Credit Facility then in effect consists of a direct pay letter of credit, the Trustee shall pay the purchase price of the Bonds, first, from moneys described in clause (b) above, second, and only to the extent such moneys were provided pursuant to the Credit Facility, from moneys described in clause (c) above, third, from moneys described in clause (d) above, and last, from the remaining sources and in the order of priority of such remaining sources described above.

Subject to Section 2.15 hereof, the Registrar shall register new Bonds as directed by the Remarketing Agent and make such Bonds available for delivery on the date of such purchase. Payment of the purchase price of any Bond shall be made in immediately available funds for Bonds in a Flexible, Daily, Weekly or Term Interest Rate Period (subject to Section 2.15(f) hereof) in each case only upon presentation and surrender of such Bond to the Trustee.

If moneys sufficient to pay the purchase price of Bonds to be purchased pursuant to Section 3.01 or Section 3.02 hereof shall be held by the Trustee on the date such Bonds are to be purchased, such Bonds shall be deemed to have been purchased and shall be purchased according to the terms hereof, for all purposes of this Indenture, irrespective of whether or not such Bonds

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shall have been delivered to the Trustee, and the former Owner of such Bonds shall have no claim under this Indenture or otherwise, for any amount due with respect to such Bonds other than the purchase price thereof.

Section 3.04. Remarketing of Bonds by Remarketing Agent . (a) Whenever any Bonds are subject to purchase pursuant to Section 3.01 or Section 3.02 hereof, the Remarketing Agent shall offer for sale and use its best efforts to remarket such Bonds to be so purchased, any such remarketing to be made at a price equal to 100% of the principal amount thereof, plus accrued interest, if any, to the purchase date. The Company may, with the consent of the Provider, direct the Remarketing Agent from time to time to cease and to resume sales efforts with respect to some of or all of the Bonds.

(b) The Remarketing Agent shall continue its efforts to remarket any Pledged Bonds without the Provider having tendered such Bonds, and any failure to timely pay principal of and interest on such Pledged Bonds to the Provider shall not constitute an Event of Default hereunder. Upon the remarketing of Pledged Bonds, the Remarketing Agent shall immediately provide telephonic notice, promptly confirmed in writing, of such remarketing to the Company and the Provider and electronic mail or facsimile notice to the Trustee, specifying in said notice the aggregate principal amount, the purchase price (which shall include any accrued interest), the purchase date and the purchaser thereof, and thereupon the Trustee or the Provider, whichever has possession of such Bonds, shall, subject to Section 3.06(a)(iii) hereof, immediately release such Bonds to the Trustee.

(c) If the Remarketing Agent is remarketing the Bonds after the date notice has been given of the redemption of such Bonds pursuant to Section 4.02 or 4.03 hereof (and prior to the redemption date thereof), the Remarketing Agent shall provide to the Trustee the names of the Persons to whom the Bonds are being remarketed so that the Trustee can provide the notice required by Section 3.05(a) hereof.

(d) Promptly, but in no event later than 11:30 a.m., New York, New York time, on the Business Day following the day on which the Trustee receives notice from any Owner of its demand to have the Trustee purchase Bonds pursuant to Section 3.01(b) or Section 3.01(c) hereof, the Trustee shall give facsimile, electronic mail or telephonic notice, confirmed in writing thereafter, to the Remarketing Agent specifying the principal amount of Bonds which such Owner has demanded to have purchased and the date on which such Bonds are demanded to be purchased.

Section 3.05. Limits on Remarketing . Any Bond purchased pursuant to Sections 3.01 and 3.02 hereof from the date notice is given of redemption pursuant to Sections 4.02 and 4.03 hereof through the date of such redemption shall not be remarketed unless the Person buying such Bonds has been given notice in writing by the Trustee that such Bonds are to be redeemed. Furthermore, in addition to the requirements of the preceding sentence, if the Bonds are subject to redemption pursuant to Section 4.03 hereof, the Person buying such Bonds shall also be given notice in writing by the Trustee that a Determination of Taxability has occurred and that such Bonds are subject to mandatory redemption pursuant to Section 4.03 hereof.

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Section 3.06. Delivery of Bonds; Delivery of Proceeds of Remarketing Sale; Payments from Credit Facility .

(a) DELIVERY OF BONDS. Bonds purchased pursuant to Section 3.01 or Section 3.02 hereof shall be delivered as follows:

(i) Delivery of Remarketed Bonds. Subject to Section 2.15 hereof, Bonds remarketed by the Remarketing Agent pursuant to Section 3.04 hereof shall be delivered to the purchasers thereof upon payment of the purchase price therefor.

(ii) Delivery of Bonds Purchased by the Company. Bonds delivered to the Trustee and purchased with moneys furnished by the Company shall at the direction of the Company, be (A) held by the Trustee for the account of the Company, (B) delivered to the Trustee for cancellation or (C) delivered to the Company.

(iii) Delivery of Pledged Bonds . Bonds delivered to the Trustee and purchased with moneys provided pursuant to the Letter of Credit shall constitute Pledged Bonds, and shall be held by the Trustee for the benefit of the Bank in a separate and segregated account to be designated as the "City of Forsyth, Montana, Pollution Control Revenue Refunding Bonds (Avista Corporation Colstrip Project), Series 2008 — Custody Account" (the "Custody Account" ). Notwithstanding anything herein to the contrary, if the Trustee holds Pledged Bonds in the Custody Account as agent of the Provider, the Trustee shall not release to the purchaser thereof or to the Remarketing Agent Pledged Bonds remarketed pursuant to Section 3.04(b) hereof unless the Trustee shall have received written notice (which may be given by electronic mail or facsimile) from the Provider that it has been paid in full for the Pledged Bonds and that the Credit Facility has been reinstated. The Trustee will comply with any DTC procedures applicable to the Pledged Bonds.

(iv) Delivery of Defeased Bonds. Bonds purchased by the Remarketing Agent with moneys described in Section 3.03(c) hereof shall not be remarketed and shall be delivered to the Trustee for cancellation.

(b) REGISTRATION OF DELIVERED BONDS. Bonds delivered as provided in this Section 3.06 shall be registered in the manner directed by the recipient thereof.

(c) NOTICE OF FAILED REMARKETING. In the event that any Bonds are not remarketed, the Remarketing Agent shall notify the Company by telephone, promptly confirmed in writing by facsimile, and the Trustee in writing (which may be delivered by facsimile) no later than 11:15 a.m., New York, New York time, on any day on which Bonds are delivered or deemed delivered for purchase under this Indenture, of the aggregate principal amount of Bonds not remarketed on such date and the aggregate principal amount of Bonds remarketed on such date but for which the purchase price has not been paid (which Bonds for purposes of this Indenture shall be considered to not be remarketed), as follows:

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(i) Such notice to the Company shall be given to the Principal Office of the Company, as follows:

The Company may, by notice given in accordance with Section 13.08 hereof to the Remarketing Agent and the Trustee, designate any further or different addresses to which subsequent such notices may be given.

(ii) Such notice to the Trustee shall be given to the Trustee, as follows:

The Trustee may, by notice given in accordance with Section 13.08 hereof to the Company and the Trustee, designate any further or different addresses to which subsequent such notices may be given.

After the receipt of such notice or if the Trustee has not received such notice by such time, the Trustee shall, by 12:00 noon, New York, New York time, on the purchase date, take the action specified in the Credit Facility to the extent necessary, after taking into account moneys referred to in Section 3.03(a), Section 3.03(b) and Section 3.03(c) hereof, as the case may be, to receive the moneys required to pay the purchase price of such Bonds.

(d) PROCEEDS OF SALE HELD FOR SELLER OF BONDS. Moneys deposited with the Trustee for the purchase of Bonds pursuant to Section 3.01 and Section 3.02 hereof shall be held uninvested in trust in one or more separate accounts, which shall be Eligible Accounts, and shall be paid to the former Owners of such Bonds upon presentation thereof. The Trustee shall notify the Company in writing within five days after the date of purchase if the Bonds have not been delivered, and if so directed by the Company, shall give notice by Mail to each Owner whose Bonds are deemed to have been purchased pursuant to Section 3.01 and Section 3.02 hereof stating that interest on such Bonds ceased to accrue on the date of purchase and that moneys representing the purchase price of such Bonds are available against delivery thereof at the Delivery Office of the Trustee. Bonds deemed purchased pursuant to Section 3.01 and Section 3.02 hereof shall cease to accrue interest on the date of purchase. The Trustee shall hold moneys deposited for the purchase of Bonds without liability for interest thereon, for the benefit

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of the former Owner of the Bond on such date of purchase, who shall thereafter be restricted exclusively to such moneys for any claim of whatever nature on its part under this Indenture or on, or with respect to, such Bond. Any moneys so deposited with and held by the Trustee not so applied to the payment of Bonds within six months after such date of purchase shall be paid by the Trustee to the Company upon the written direction of the Authorized Company Representative, and thereafter the Trustee shall have no further liability with respect to such moneys and the former Owners shall be entitled to look only to the Company for payment, and then only to the extent of the amount so repaid to the Company, and the Company shall not be liable for any interest thereon and shall not be regarded as a trustee of such money.

Section 3.07. No Remarketing Sales After Certain Events . Anything in this Indenture to the contrary notwithstanding, there shall be no sales of Bonds pursuant to a remarketing in accordance with Section 3.04 hereof, if (a) there shall have occurred and not have been cured or waived an Event of Default described in Section 9.01(a), Section 9.01(b) or Section 9.01(c) hereof of which an authorized officer in the Principal Office of the Remarketing Agent and an authorized officer of the corporate trust department of the Trustee have actual knowledge or (b) the Bonds have been declared to be immediately due and payable pursuant to Section 9.02 hereof and such declaration has not been rescinded pursuant to Section 9.02(d) hereof.

Section 3.08. Notice of Mandatory Purchase . (a) The Trustee shall give notice by Mail of a proposed Change of Credit Facility pursuant to Section 4.07(b) of the Agreement and mandatory purchase of the Bonds to the Owners not less than 15 days prior to the effective date of such Change of Credit Facility. In addition to the requirement of Section 3.08(f), the notice of mandatory purchase shall (i) describe the proposed Change of Credit Facility (subject to the Company’s ability to rescind its election to make such Change of Credit Facility) and (ii) state the effective date of such Change of Credit Facility.

(b) The Trustee shall, as soon as practicable, but in no event later than one Business Day prior to the date the Bonds are subject to mandatory purchase pursuant to Section 3.02(a)(iv) or (v), give written notice by electronic mail, by facsimile or by overnight mail service of a mandatory purchase of Bonds pursuant to Section 3.02(a)(iv) or (v) to the Remarketing Agent and to the Owners.

(c) The Trustee shall give notice by Mail of an election by the Company to trigger a mandatory purchase pursuant to Section 3.02(a)(vi) hereof to the Owners not less than 15 days prior to the date designated by the Company for such mandatory purchase.

(d) The Trustee shall give notice by Mail of a mandatory purchase pursuant to Section 3.02(a)(ii) hereof to the Owners not less than 15 days prior to the last day of the applicable Flexible Segment.

(e) The Trustee shall give notice by Mail of a mandatory purchase in accordance with the provisions of Section 2.02(f).

(f) Each notice of a mandatory purchase shall (i) state the purchase date, (ii) identify the particular clause of Section 3.02(a) that triggers the mandatory purchase, (iii) describe the

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procedures for such mandatory purchase, (iv) state the purchase price of such Bonds on such date (expressed as a percentage of the principal amount thereof), (v) state that the Owners of such Bonds do not have the right to retain their Bonds on such date, and (vi) state such other matters as the Company may direct.

Section 3.09. Pledged Bonds . If a beneficial interest in a Bond is purchased with moneys drawn under the Credit Facility pursuant to the provisions hereof, that beneficial interest shall be designated on the books of the Remarketing Agent as a Pledged Bond until released as herein provided. Provided there is no Event of Default under this Indenture, the Remarketing Agent shall use its best efforts to remarket beneficial interests in Pledged Bonds. If the Remarketing Agent remarkets any beneficial interest in a Pledged Bond, the Remarketing Agent shall give notice by electronic mail or facsimile to the Provider of such remarketing, and shall direct the purchaser of such beneficial interest to transfer, by 12:00 noon, New York, New York time, on the purchase date, the purchase price of such remarketed beneficial interest to the Trustee for deposit into the Custody Account. The Trustee shall immediately give notice by electronic mail or facsimile to the Provider and the Remarketing Agent of the receipt of the purchase price for such beneficial interest in such Pledged Bond, which notice shall also request the Provider promptly advise the Trustee and the Company of amounts that remain due and owing to the Provider pursuant to the Credit Facility Agreement as a result of a draw on the Credit Facility. Upon receipt by the Trustee of such purchase price and written notice (which may be given by electronic mail or facsimile) from the Provider of the reinstatement of the Credit Facility, such Pledged Bond shall be considered released from the pledge to the Provider. The Trustee shall immediately transfer such purchase price to the Provider upon receipt thereof to the extent that amounts remain due and owing the Provider pursuant to the Credit Facility Agreement as a result of a draw on the Credit Facility and give all required notices, in accordance with the terms of the Credit Facility. If moneys remain on deposit with the Trustee in the Custody Account after payment is made to the Provider of all amounts due and owing to the Provider