20160304Compliance filing.pdf

RECEIVED
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March 3,2016
State of ldaho
ldaho Public Utilities Commission
Statehouse
Boise ID 83720
Attention: Jean D. Jewell, Secretary
CaseNo. AVU-U-I l{2
Avista Corporation (Avista Corp.) is submitting the following information in compliance with the
Commission's Order No. 32381 under Case No. AVU-U-I l-02 for the issuance of up to 5,500,000 shares
of authorized but unissued Common Stock (of which 3,795,199 shares remain undelivered).
On March 2.2016, Avista Corporation (Avista Corp.) emtered into four scparae Sales Agcncy
Agrecments (each, an "Agreernont" and collectively, the *Agreemonts') with BNY Mellon Capital
Marke*s, LLC, Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC and Merrill Lynch,
Piercg Fenner & Smith Incorporated (collectively, the "Sales Agents'). Under the terms of the
Agre+mants, Avista Corp. may offer and sell up to 3,795,199 ehares of its common stock, no par value,
from time to time through the Sales Agurts, as Avista Corp.'s agents for the offer and sale ofthe sharcs,
Unless earlier terminarcd, each Agreement will rcrminate upon the earlier of (i) ttrc sale of all of the
shares through such Agreement or (ii) February 29,2020.
Thc offering of shares will bc made pursuant to Avista Corp.'s rcgishation statcment previously filed
with the Sectnities and Exchange Commission (SEC) (File No. 333-2W7l4I which bccamc cffective on
February 25,2016 (the *Regisbation Statement"). Avista Corp. filed a prospeotus supplement with the
SEC in connection with this offer and salo of shares.
Additionally, the following documents are included with this filing as exhibits:
l. The respectiv€ prospectus supplement dated Mrrch 2,2016.2. Sales Agenry Agrcement dated as of March 2,2016 bctrueen Avista Corp. and BNY Mellon
CapialMarkets, LLC.3. Sales Agorcy Agecment dated
Securities (USA) LLC.4. Sales Agency Agreement dated
Securities LLC.
5. Sales Agency Ageement dated as of March 2,2016 between Avista Corp. and Menill Lynch,
Pierce, Fenner & Smith Incorporated.
as of March 2,2016 betrueen Avista Corp. and Credit Suisse
as of March 2, 2016 betwecn Avista Corp. and J.P. Morgan
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UNITED STATES
SECURITIES AND EXCIIANGE COMMISSION
rileshington D.C.20549
FORM 8-K
CURRENT REPORT
PLJRSUANT TO SECTION 13 OR 15(d) OF
TITE SECIruTIES EXCSA.I{GE ACT OF 1934
Date ofReport (Date ofearliest event reported): March 2, 20 I 6
AVISTA CORPORATION
@xact name ofregistrant as specified in its charter)
1-3701
(Commissioa
file numbcr)
RECEruEO 1
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Washinston
(State of o the r j urisdictio n of
incorporation)
141I Eest Migrion Avenuc. Sookrne. Washington
(Address of principal execative ofices)
Registrant's telephone number, lncludlng aree code:
Web sitc: http ://www.avistacotp.coil
914452470
(LRSEmployer
Identification No)
99202-2600
(Zip Code)
509489{t500
(Former name or former address, if changed since last rcport)
Check the appropriate box below ifthe Form 8-K filing is intended to simultaneously satisfy the filing obligation ofthe registrant under any ofthe following
provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (l 7 CFR 230.425)
[] Solicitingmaterial pursuantto Rule l4a-12 undertheExchangeAct(17 CFR240.l4a-12)
[ ] Pre-commencement cornmunications pursuant to Rule l4d-2@) under the Exchangc Act (17 CFR 240.14d-2(b)
[ ] Pre-commencement communications pursuant to Rule l3e-4(c) under the Exchange Act (17 CFR 240.13e4(c))
SectionS-OtherEvents
Item 8.0I Other Events.
On March 2, 20 1 6, Avista Corporation (Avista Corp.) entered into four separate Sales Agency Agreements (each, an "Agreement" and collectively, the
"Agreements") with BNY Mellon Capital Markets, LLC, Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC and Menill Lynch, Pierce, Fenner &
Smith Incorporated (collectively, the "Sales Agents"). Under the terms ofthc Agreements, Avista Corp. may offer and sell up to 3,795,1 99 shares ofits
common stock, no par value, from time to time through the Sales Agents, as Avista Corp.'s agents for the offer and sale ofthe shares. Unless earlier terminated,
each Agreement will terminate upon the earlier of(i) the sale ofall ofthe shares through such Agreement or (ii) February 29,2020.
The offering of shares will be made pursuant to Avista Corp.'s registration statement previously filed with the Securities and Exchange Commission (SEC)
(File No. 333-2097t4),which became effective on February 25,2016 (the "Registration Statement"). Avista Corp. filed a prospectus supplement with the
SEC in connection with this offer and sale ofshares.
This Current Report on Form 8-K is being filed for the purpose offiling exhibits to the Registration Statement. Such exhibits are hereby incorporated by
reference into the Registration Statement.
This Cunent Report on Form 8-K does not constitute an offer to sell or a solicitation ofan offer to buy the securities described herein, and there shall not be
any sale ofthese securities in any state orjurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under
the securities laws ofany such jurisdiction. The sale ofsecurities is being made only by means ofa prospectus and related prcspectus supplement.
Section 9 - Finencial Statements and Erhibits
Item 9.01 Financial Statements end Exhibits.
(d) Exhiblts
I .l Sales Agency Agr€ement dated as of March 2, 2016 between Avista Corp. and BNY Mellon Capital Markets, LLC.
I .2 Sales Agency Agrcement dated as of March 2, 201 6 between Avista Corp. and Crcdit Suisse Securities (USA) LLC.
I .3 Sales Agency Agreement dated as of March 2,2016 befween Avista Corp. and J.P. Morgan Securities LLC.
1 .4 Sales Agency Agreement dated as of March 2,2016 between Avista Corp. and Merrill Lynch, Pierce, Fenner & Smith Incorporated.
SIGNATI'RES
Pursuant to the requircments ofthe Securities Exchange Act of I 934, the registrant has duly caused this report to be signed on its behalfby the undersigned
thereunto duly authorized.
AVISTA CORPORATION
Date: March 2, 201 6
(Registrant)
/s/ Marian M. Durkin
Marian M. Durkin
SeniorVice Prrsident, General Counsel
and Chief Compliance Officer
Erhlbit 1.1
AVISTA CORPORATION
(a Washington corporation)
Common Stock
SALESAGENCYAGREEMENT
Dated: March 2,2016
Table of Contents
Certain Definitions
Representations and Warranties
(a\ Representations and Warranties ofthe Company
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(ix)
(x)
(xi)
(xiD
Prse
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SECTION I.
SECTION2.
SECTION 3.
SECTION4.
Compliance with Securities Law Requirements
Incorporated Documents
Independent Accountants
Financial Statements
No Material Adverse Change
Good Standing ofthe Company and Designated Subsidiaries
(vii) No Significant Subsidiaries
(viii) Capitalization
Authorization of this Agreement
Authorization of the Shares
Description of the Common Stock
Registration; Listing
(xiii) Actively Traded Securities
(xiv) Absence ofDefuults
(xv) No Conflict
(xvi) Absence ofProceedings
(xvii) AbsenceofFurtherRequirements
(xviii) TitletoProperty
(xix)
(xx)
Leases
lnvestment Company Act
(xxi) Environmental Laws
(xxii) Intemal Controls
(xxiii) CompliancewithSa6anes0nley
(xxiv) Finder's Fees
(xxv) Sanctions
(xxvi) Compliance with Money Laundering Laws
(xxvii) No Unlawfirl Payments
b) Wicer's C ertiJicates
Offers and Sales ofShares
(a) Initiation ofSales Efforts
S) Manner of Offer and Sales
(c) Sales Pice
(d) Confirmation of Sales
(e\ Settlement of Sales
(f) Suspension of Sales
(g) Propietary Trading by the Sales Agent
(h) Limitations
Covenants
(a) Preparation and Filing of the Prospectus
SECTION 5.
SECTION6.
SECTION 7
SECTION 8.
SECTION9.
SECTION IO.
SECTION I I.
(b) Review ofAmendments and Supplements
(c) Free Wriling Prospectuses
(d) Notification of Commission Comtnents and Orders, Etc.
(e) Delivery of Regist/ation Statements
(f) Delivery of Prospectuses
(g) Conlinued Compliance with Securities laws
$) Blue Sfu QualiJications
(i) Rule 158
Q) Filing Fees
(k) Use of Proceeds
(l) Restriction on Sale of Shares
(m) Maxinatm Number
(n)Regulation M
(o) Diligence Cooperation
Payment ofExpenses
(a)Expenses Payable by the Company
(b) Expenses Payable by the Sales Agenl
(c) Expenses Upon Termination
Conditions of the Sales Agent's Obligations; Termination of Agreement
(a) Conditions
(i) No Stop Order; Commission Filings
(ii) Opinions ofCounselfor the Company
(iii) Opinion ofCounselJbr the Sales Agent
(iv) No Material Adverse Change; Ofticers'CertiJicate
(v) Accountant's Confort Lener
(vi) Additional Conditions
(vii) Additional Documents
(viii) AdditionalConditionsfor"Distributions"
@) Termi n atio n of A gree me n t
(c) Increase of Maximum Number
Indemnification
(a) Indemnification of the Sal* Agent
$) IndemniJication of the Company
(c) Actions against Parties; Notification
Contribution
Reprcsentations, Warranties and Agreements to Survive
Termination of Agreement
(a) Termination by the Sales Agent
(b)Termination by the Company
(c) Liabilities
Notices
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SECTION 12.
SECTION 13.
SECTION 14.
SECTION I5.
SECTION 16.
SECTION 17.
SECTION I8.
SECTION I9.
SECTION20.
SC}IEDIJLES
Schedule A
EXHIBMS
Exhibit A
(a) General
(b) Sales Notice; Confinrution and Settlement ofSales; Suspension of Sales
Parties in Interest
No Advisory or Fiduciary Relationship
Goveming lawand Time
WaiverofJury Trial
Counterparts
Entirc Agreement
Effect ofHeadings
No Assignment
Severability
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2?
Contact PerBons
Form ofSales Notice
Sch A
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AVISTA CORPORATION
(a Washington corporation)
Common Stock
SALES AGENCY AGREEMENT
March2,2O16
BNY MELLON CAPITAL MARKETS, LLC
l0l Barclay St., 3W
New York, NY 10286
Ladies and Gentlemen:
Avista Corporation, a Washington corporation (the "Company"), confirms its agreement (the "Agreemenf') with BNY
Mellon Capital Markets, LLC (the "Sales Agent"), whereby the Company, subject to the terms and conditions set forth herein, may
from time to time offer shares ("Shares") of its Common Stock, without nominal or par value ("Common Stock'), and the Sales Agent,
subject to such terms and conditions, shall offer Shares for sale as the Company's sales agent ot in limited circumstances with the
agreement of both the Company and the Sales Agent may purchase Shares as principal.
The Company may enter into one or more agreements substantially identical to this Agreement (each an "Other Agreement")
with ottrer investment banking firrns as sales agents (each an "Other Sales Agent") whereby, subject to the terms and conditions set
forth herein and therein, the Company may from time to time offer Shares and the Other Sales Agent party thereto, subject to such terms
and conditions, shall offer Shares for sale as the Company's sales agent or, in limited circumstances with the agreement of both the
Company and such Other Sales Agent, may purchase Shares as principal.
The maximum number of Shares that the Company may issue and sell under this Agreement and all the Other Agreements,
collectively, is the Maximum Number (as hereinafter defined).
On February 25,2016, the Company filed with the Securities and Exchange Commission (the "Commission") a registration
statement on Form S-3 (No. 333-209714), for the registration of securities, including the Shares, under the Securities Act of 1933, as
amended (the "f933 Act"), and the offer and sale thereof from time to time in accordance with Rule 415 of the rules and regulations of
the Commission under the 1933 Act (the "1933 Act Regulations").
SECTION l. Certain Definitions
When used in this Agreement, the following terms have the meanings specified below:
"Accounting Controls" has the meaning set forth in Section 2(a)(xxii)(I).
"Agreements and Instruments" has the meaning set forth in Section 2(a)(xiv).
"Applicable Time" means the time of each sale of Shares pursuant to this Agreement.
"Base Prospectus" means the base prospectus relating to the Shares filed as part of the Registration Statement, in the form in
which it has been most recently filed with the Commission prior to the Closing Time.
"Closing Time" means the time and date of the execution and delivery of this Agreement.
"Commercially Reasonable Efforts" means, with respect to the obligation of the Sales Agent to offer and sell Shares,
commercially reasonable efforts consistent with its normal trading and sales practices and in compliance with applicable law.
"Commission" has the meaning forth in the preamble to this Agreement.
"Commitment Period" means the period commencing on March 2, 2016 and expiring on the earliest to occur of (a) the first
date on which the Maximum Number of Shares shall have been sold under this Agreement and/or the Other Agreements, (b) the date
this Agreement is terminated pursuant to Section 6 or Section l0 and (c) February 29,2020.
"Common Stock' has the meaning set forth in the preamble to this Agreement.
"Company" has the meaning set forth in the preamble to this Agreement.
"Designated Subsidiary" means each of Avista Capital, Inc., Alaska Energy and Resources Company and Alaska Electric
Light and Power Company.
"Disclosure Controls" has the meaning set forth in Section 2(a)(xxii)(l!.
"Disclosure Package" means, collectively, (i) the hospectus as of any particular time and (ii) any other Issuer Free Writing
Prospectus relating to the offer and sale of the Shares (to the extent not superseded or modified by the hospechrs or by a subsequent
Issuer Free Writing Prospectus).
*EDGAR" has the meaning set forth below in this Section l.
"Effective Time" means the date and time of the effectiveness of the Registration Statement for purposes of paragraph (f)(2)
of Rule 4308 of the 1933 Act Regulations ("Rule 4308"), as applied to the Sales Agent.
"Floor Price" means the minimum Sales Price set by the Company in a Sales Notice for any Selling Period, as such Sales
Notice may be amended from time to time during such Selling Period. The Floor Price may, in addition to setting an absolute minimum
dollar amount per Share, also be limited by reference to recent or prevailing market prices.
"Initiation Date" means each date of delivery of a Sales Notice pursuant to Section 3(a).
"Internal Controls" has the meaning set forth in Section 2(a)(xxii)(I[).
"Issuer Free Writing Prospectus" means any "issuer free writing prospectus" (as defined by Rule 433 of the 1933 Act
Regulations ("Rule 433")) with respect to the Shares.
"Liens" has the meaning set forth in Section 2(aXxviii).
"Material Adverse Change" has the meaning set forth in Section 2(a)(v).
"Material Adverse Effect" has the meaning set forth in Section 2(a)(vi).
"Maximum Number" means 3,795,199 or such higher number as shall be established pursuant to Section 6(c).
"Net Proceeds", with respect to any Shares sold hereundel means the aggregate Sales Prices for such Shares less the Selling
Commission in respect of the sale of such Shares (but before other expenses).
"NYSE" means the New York Stock Exchange.
"Other Agreement" has the meaning set forth in the preamble to this Agreement.
"Other Sales Agent" has the meaning set forth in the preamble to this Agreement.
"Primary Delivery Date" has the meaning set forth in Section 6(a)(ii).
"Prospectus" means, as of any particular time, the Base Prospectus, as supplemented by the final prospectus supplement
relating to the offer and sale of the Shares, as filed with the Commission pursuant to Rule 424(b), together with any further supplements
or amendments thereto at such time.
"PUC Orders" has the meaning forth in Section 2(a)(xvii).
"Registration Statement" means, as of any particular time, the Company's registration statement on Form S-3 (No. 333-
209714), including (a) any amendments thereto at such time, (b) the exhibits and schedules thereto at such time (other than the
Statement of Eligibility on Form T-l ) and (c) any prospectus filed with the Commission pursuant to Rule 424(b) that, in accordance
with Rule 4308, is deemed to be a part thereof; provided, however, that, if a new registration statement shall have been filed and shall
have become effective on or about ttre third anniversary of the initial effective date of regisffation statement No. 333-209714, the term
"Registration Statement" shall mean, at and after the time of the effectiveness of such new registration statement, such new registration
statement, including amendments, exhibis and any prospectus as aforesaid.
"Regulation $T" means Regulation S-T of the Commission.
"Repayment Event" has the meaning set forth in Section 2(a)(xv).
"Representation Date" has the meaning set forth in Section 2(a).
"Rule 405" means Rule 405 of the I 933 Act Regulations.
"Rule 424(b)" means Rule 424(b) of the 1 93 3 Act Regulations.
"Sales Agent" has the meaning set forth in the preamble to this Agreement.
"Sales Notice" means a written notice, substantially in the form of Exhibit A hereto, executed by an individual named in
Schedule A hereto who is the President, a Senior Mce President, a Vice President, the Tieasurer or an Assistant Tieasurer of the
Company and delivered to the Sales Agent in accordance with this Agreement. Any Sales Notice may be amended by the Company and
the Sales Agent and, from and after the time of such amendment the term "Sales Notice" shall mean the original Sales Notice as
amended. Any Sales Notice or amendment to a Sales Notice shall be deemed acceptable to the Sales Agent unless the Sales Agent shall
promptly notiff the Company to the contrary. Each Sales Notice shall be delivered, and may be amended, by facsimile transmission, e-
mail or other customary means of electonic communication.
"Sales Price", with respect to any Shares sold hereunder, means the price per Share paid to the Sales Agent for such Shares.
"Secondary Delivery Date" has the meaning set forth in Section 6(aXiiXB).
"selting Commission", with respect to any Shares sold hereundet means the commission, discount or other compensation to
be received by the Sales Agent in connection with the sale of such Shares.
"Selling Period" means a period of one to 20 consecutive Trading Days specified by the Company in a Sales Notice,
commencing no earlier than the Trading Day next succeeding the Trading Day on which such Sales Notice is delivered to the Sales
Agent.
"Settlement Date" means, with respect to the sale of any Shares, the third business day following the Trading Day on which
an offer to sell such Shares was accepted.
"Shares" has the meaning set forth in the preamble to this Agreement.
"Terms Agreement" means an agreement between the Company and the Sales Agent that relates to the issuance and sale by
the Company, and the purchase by the Sales Agent as principal (and not as agent), of a specific number of Shares and otherwise
incorporates the terms and provisions of, and is deemed a part of, this Agreement.
"Trading Day" means any day on which the NYSE is open for rading (other ttran a day on which trading is scheduled to
close prior to its regular weekday closing time).
"1933 Act" has the meaning set forth in the preamble to dris Agreement.
"1933 Act Regulations" has meaning set forth in the preamble to this Agreement.
"1934 Act" means the Securities Exchange Act of 1934, as amended.
"1934 Act Regulations" means lhe rules and regulations of the Commission under the 1934 Act.
The foregoing definitions are subject to the following qualifications:
(a) all references in this Agreement to the Registration Statement or the Prospectus or to any of the financial statements,
schedules or other information that is "contained", "included" or "stated" (or other words of like import) therein shall be deemed to
include the information contained in documents filed with the Commission under the 1934 Act that (i) are incorporated, or deemed
incorporated, therein by reference pursuant to Item 12 of Form S-3 under the 1933 Act, to the extent such information has not been
superseded or modified in accordance with Rule 412 of the 1933 Act Regulations (as qualified by Rule a30B(g) of the 1933 Act
Regulations) and (ii)(A) in the case of references to the "Registration Statement", are filed with the Commission at or prior to the
Effective Time and (B) in the case of references to the "Prospectus", are filed with the Commission atorpriorto the date thereof;
(b) all references in this Agreement to an amendment to the Registration Statement shall be deemed to include any document
filed under the 1934 Act subsequent to the date thereofthat is deemed incorporated by reference therein pursuant to Item l2 ofForm S-
3 under the 1933 Act;
(c) all references in this Agreement to an amendment or supplement to the Prospectus shall be deemed to include any
document filed under the 1934 Act subsequent to the date thereof that is deemed incorporated by reference therein pursuant to Item 12
ofForm S-3 underthe 1933 Act; and
(d) all references in this Agreement to the Registration Statement, any Issuer Free Writing Prospectus, the Prospectus or any
amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to its
Electronic Data Gathering, Analysis and Retrieval sysiem C'EDGAR").
SECTION 2. Representations and Warranties.
( a ) Reprcsentations and Warranties of the Company. The Company represents and warrants to the Sales Agent as of the
Closing Ttme, each Initiation Date, each Trading Day and each Applicable Time within each Selling Period, each Settlement Date, each
date as of which the Regisfration Statement shall be amended and each date as of which the Prospectus shall be amended or
supplemented (each such date a "Representation Date") as follows:
(D Comoliance with Securities Law Requirements.
(A) Well-Known Seasoned Issuer Status. At the time the Registration Statement was filed with the Commission,
at all relevant determination dates, and at the date hereof, the Company was and is a "well-known seasoned issuer" (as
defined in Rule 405).
( B ) Eligibility to Use Form S-3. At the time the Registration Statement was filed with the Commission and at
the time of the most recent amendment, if any, to the Registration Statement for purposes of complying with Section
,10(a)(3) of the 1933 Act, the Company met the requirements foruse of Form S-3 under the 1933 Act.
( C ) Status and Content of the Reeistration Statement. The Resistration Statement became effective
automatically upon the filing thereof with the Commission under the 1933 Act. No stop order suspending the
effectiveness of the Registration Statement has been issued under the 1933 Act and no proceedings for that purpose
have been instituted by the Commission or are pending or, to the knowledge of the Company, have been threatened or
are contemplated by the Commission, and any request on the part of the Commission for additional information with
respect to the Registration Statement has been complied with. At the time the Registration Statement became effective,
and at the Effective Trme, the Registration Statement complied in all material respects with the requirements of the 1933
Act and the 1933 Act Regulations. At the Effective Time, the Registration Statement did not contain an untrue statement
of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements ttrerein
not misleading.
(D) Issuer Free Writing Prospectuses. At the earliest time after the filing of the Registration Statement that the
Company or another offering participant made a bona fide offer (within ttre meaning of Rule t64(hX2) of the 1933 Act
Regulations) of the Shares, the Company was not an "ineligible issuer" as defined in Rule 405. Each Issuer Free Writing
Prospechrs, at the time it was filed with the Commission pursuant to Rule 433 or, if it was not required to be so filed, at
the time of each use thereof (i) did not include any information that conflicts with (A) information contained in the
Registration Statement, including any prospectus or prospectus supplement that is part of the Registration Statement, and
not superseded or modified, or (B) information contained in the Company's periodic and current reports filed with the
Commission pursuant to Section l3 or l5(d) of the 1934 Act ttrat are incorporated or deemed incorporated by reference
in the Registration Statement, and not superseded or modified, and (ii)
complied in all other respects with the requirements of Rule 164 and Rule 433 (without reliance on subsections (b), (c)
and (d) of Rule I 64 of the I 933 Act Regulations). No order preventing or suspending the use of any Issuer Free Writing
Prospectus has been issued by the Commission.
( E ) Content of the Disclosure Package. The Disclosure Package, at the Closing Time and at each Initiation
Date, each Applicable Time within each Selling Period and each Settlement Date, will not contain any untrue statement
of material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(F) Status and Content of the Prospectus. The Prospectus, at the Closing Time, as of its date and at the time it is
filed with the Commission and at each Initiation Date, each Applicable Time within each Selling Period and each
Settlement Date, will conform in all material respects with the requirements of the 1933 Act and the 1933 Act
Regulations and, as of such respective dates, will not contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of the circumstances under which they were
made, not misleading. The Prospectus delivered to the Sales Agent in connection with the offering of the Shares, and
any amendment or supplement thereto, will be identical to the copies thereof filed electronically with the Commission
pursuant to EDGAR (except that the registration fee table will be deleted from the cover thereof), except to the extent
permitted by Regulation S-T.
( G ) Descriotion and Filing of Contracts and Documents. All contracts or documents that are required to be
described in the Registration Statement or the Prospectus or to be filed as exhibits to the Registration Statement have
been so described and filed as required.
The representations and warranties in this subsection (a)(i) shall not apply to any statements in or omissions from the
Registration Statement, any Issuer Free Writing Prospectus, the Disclosure Package or the hospectus made in reliance upon and
in conformity with information furnished to the Company in writing by the Sales Agent expressly for use therein.
(ii) Incorporated Documents. The documents incorporated or deemed incorporated by reference in the Registration
Statement and the Prospectus, at the time they were or hereafter are filed with the Commission, complied or will comply, as
applicable, in all material respects with the requirements of the I 934 Act and the I 934 Act Regulations and, when filed did not
and will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not misleading.
(iiD Independent Accountants. The accountants who audited the financial stratements and hnancial statement schedules
included in the Registration Statement, the Disclosure Package and the Prospectus are independent registered public
accountants within the meaning of Regulation S-X of the Commission.
(iv) Financial Statements. The flrnancial statements, together with *re respective schedules and notes relating thereto,
included in the Registration Statement, the Disclosure Package and the Prospechrs, present fairly the financial position of the
Company and its consolidated subsidiaries atthe dates indicated and the results of operations and cash flows of the Company
and its consolidated subsidiaries for the periods specified; such financial statements
have been prepared in conformity with United States generally accepted accounting principles applied on a consistent basis
throughout the periods involved, except as otherwise stated therein. The selected financial data and the summary financial
information included in the Registration Statement, the Disclosure Package and the Prospectus present fairly the information
shown therein and have been compiled on a basis consistent with that of the audited financial statements included in the
Registration Statement. The financial statements and other financial data included in the Regishation Statement and the
Prospectus comply in all material respects with the requirements of paragraph (e) of Item l0 of Regulation S-K. The interactive
data in eXtensible Business Reporting Language filed as exhibits to the documents incorporated by reference or deemed to be
incorporated by reference into the Registration Statement and the Prospectus fairly presents the information called for in all
material respects and has been prepared in accordance with the Commission's rules and guidelines applicable thereto. Except
as disclosed in the Registration Statement, the Disclosure Package and the Prospectus, neither the Company nor any of its
subsidiaries has any off-balance sheet arrangements of the character contemplated by Item 303 of Regulation S-K or otherwise
by Section l3G of ttre 1934 Act, or has any other contingent obligation or liability, which, in any case, is material, or is
reasonably likely to be material, to the Company and its consolidated subsidiaries considered as one enterprise.
( v ) No Material Adverse Chanse. Since the date of the latest audited balance sheet included in the Registration
Statement, the Disclosure Package and the Prospectus and except as disclosed therein, there has been no material adverse
change, or any development that could reasonably be expected to result in a material adverse change, in the condition
(hnancial or otherwise), business, properties or results of operations of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business (any such change or development, a "Material Adverse
Change").
(v i ) Good Standing of the Company and Designated Subsidiaries. Each of the Company and each of the Designated
Subsidiaries has been duly incorporated and is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation and has the corporate power and authority to own or lease and operate its properties and to
conduct its business as described in the Registration Statemen! the Disclosure Package and the Prospectus, and the Company
has the corporate power and authority to enter into and perform its obligations under this Agreement and the Other
Agreements; and the Company is duly qualified as a foreign corporation to hansact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct
of business, except where the failure so to qualifu or to be in good standing would not have a material adverse effect on the
condition (financial or otherwise), business, properties or resul8 of operations of the Company and its subsidiaries considered
as one enterprise, whether or not arising in the ordinary course of business (any such effect, a "Material Adverse Effect").
(vii) No SignificantSubsidiaries. The Company has no "significantsubsidiaries" as defined in Rule l-02 of Regulation
s-x.
(viii) Capitalization. The authorized, issued and outstanding capital stock of the Company is as set forth in the
Registration Statement and the Prospectus. All of the issued and outstanding shares of Common Stock of the Company have
been duly authorized and validly issued and are fully paid and non-assessable. All of the issued and outstanding shares of
capital stock of each Designated Subsidiary have been duly authorized and validly issued, are fully paid and non-assessable
and are owned, directly or indirectly, by the Company, free and clear of any Liens.
( i x ) Authorization of this Agreement. This Agreement has been duly authorized, executed and delivered by the
Company.
( x ) Authorization of the Shares. The Shares have been duly authorized by the Company and, when issued and
delivered by the Company pursuant to this Agreement or any of the Other Agreements against payment of the consideration
contemplated herein or therein, will be validly issued, fully paid and non-assessable; no holder of the Shares will be subject to
personal liability in respect of liabilities of the Company solely by reason of being a holder of the Shares; and the issuance of
the Shares is not subject to the preemptive or other similar rights of any securityholder of the Company. Except as disclosed in
the Registration Statement and the Prospectus, there are no outstanding options, warrants, conversion rights, subscription
rights, rights of first refusal or other rights or agreements of any nature outstanding to subscribe for or to purchase any shares
of Common Stock of the Company binding on the Company (except pursuant to dividend reinvestment, stock purchase or
ownership, stock option or other director or employee benefit plans), and there are no outstanding securities or instruments of
the Company containing anti-dilution or similar provisions that will be triggered by the issuance of the Shares as described in
this Agreement or the Other Agreements. Except as disclosed in the Registration Statement and the Prospectus, there are no
restrictions upon the voting or transfer of any shares of the Company's Common Stock pursuant to the Company's Restated
Articles of Incorporation or By-laws. There are no agreements or other obligations (contingent or otherwise) that may require
the Company to repurchase or otherwise acquire any shares of its Common Stock. No person or entity has the right,
contractual or otherwise, to cause the Company to issue to it, or to register pursuant to the 1933 Act, any shares of Common
Stock upon the filing of the Registration Statement or the issuance or sale of the Shares hereunder. Immediately after any sale
of Shares by the Company under this Agreement and the Other Agreements, the aggregate number of Shares that have been
issued and sold by the Company hereunder and thereunder will not exceed the aggregate amount of Common Stock (A)
registered and available under the Registration Statement or (B) that shall be authorized by the PUC Orders from time to time.
( x i ) Description of the Common Stock. The description of the Common Stock in the Registration Statement, the
Disclosure Package and the hospectus is accurate in all material respects.
(xii) Registration: Listing. The Common Stock is registered as a class under Section l2(b) of the 1934 Act. The
outstanding shares of Common Stock are listed, and the Shares are authorized for listing (subject to official notice of issuance),
on the NYSE.
(xiii) Actively Traded Securities. The outstanding shares of Common Stock are "actively traded securities" excepted
from the provisions of Rule l0l of Regulation M of the 1934 Act Regulations by virtue of subsection (c)(l) of such rule.
(xiv) Absence of Defaults. Neittrer the Company nor any Designated Subsidiary is in violation of its arhcles of
incorporation or byJaws or in default in the performance or observance of any obligation, agreement, covenant or condition
contained in any contract, indenfure, mortgage, deed of trust, loan or credit agreement, note, lease or other agreement or
instrument to which the Company or such Designated Subsidiary is a party or by which it or such Designated Subsidiary may
be bound, or to which any of the property or assets of the Company or such Designated Subsidiary is subject (collectively,
"Agreements and Instruments") except for such defaults as, singly or in the aggregate, would not result in a Material Adverse
Effect.
(*r) No Conflict. The execution and delivery by the Company of this Agreement and the Other Agreements and the
consummation by the Company of the transactions contemplated herein and therein (including the issuance and sale by the
Company of the Shares and the use of the proceeds from the sale of the Shares as described in the Registration Statement, the
Disclosure Package and the Prospectus) and compliance by the Company with its obligations hereunder and under the Other
Agreements, do not and will not whether with or without the giving of notice or passage of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined below) under, or result in the creation or imposition of any
Lien upon any property or assets of the Company or any Designated Subsidiary pursuant to, the Agreements and Instruments
(except for such conflicts, breaches, defaults or Liens as, singly or in the aggregate, would not reasonably be expected to result
in a Material Adverse Effect), nor will such action result in any violation of the articles of incorporation or by-laws of the
Company or any Designated Subsidiary or of any statute of any jurisdiction applicable to the Company or any Designated
Subsidiary or any rule, regulation or order applicable to the Company or any Designated Subsidiary of any regulatory body,
administrative agency or other governmental body or any court that in any such case, has jurisdiction over the Company or
any Designated Subsidiary or any of their respective assets, properties or operations. As used herein, a "Repayment Event"
means any event or condition that gives the holder of any note, debenture or other evidence of indebtedness (or any person
acting on such holder's behalf) the right to require the repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any Designated Subsidiary.
(xvi) Absence of Proceedings. There is no action, suit, proceeding, inquiry or investigation before orbroughtby any
court or governmental agency or body, domestic or foreign, now pending, or, to the knowledge of the Company, threatened,
against or affecting the Company or any of its subsidiaries, that (A) is required to be disclosed in the Registration Statement or
the Prospectus and is notdisclosed as required, (B) could materially and adversely affectthe consummation of the transactions
contemplated in this Agreement or any of the Other Agreements or the performance by the Company of its obligations
hereunder or thereunder or (C) except as disclosed in the Registration Statement, the Disclosure Package and the Prospectus,
would reasonably be expected to result in a Material Adverse Effect; and the aggregate of all pending legal or govemmental
proceedings to which the Company or any of its subsidiaries is a party or of which any of their respective properties or assets
is the subject that are not described in the Regisbation Statement, the Disclosure Package and the Prospectus, including
ordinary routine litigation incidental to the business, would not reasonably be expected to result in a Material Adverse Effect.
(xvii) Absence of Further Requirements. The Washington Utilities and Transportation Commission (the "WUTC"), the
Idaho Public Utilities Commission (the "IPUC") and the Public Utility Commission of Oregon (the "OPUC") have issued
orders authorizing the issuance and sale by the Company of the Shares on the terms contemplated in this Agreement and the
Other Agreements; the Montana Public Service Commission (ttre "MPSC") has issued an order disclaiming jurisdiction over
the issuance of securities and the creation of liens by the Company pursuant to, and on the terms set forth in such order (such
order, collectively with the aforesaid orders of the WUTC, the IPUC and the OPUC, being hereinafter called the "PUC
Orders"); the PUC Orders are in full force and effect as of the date hereof; and, except for informational filings required under
the PUC Orders, no further consent, approval or authorization of, or registration, filing or declaration with, any regulatory or
other govemmental body or agency is required in connection with the execution, delivery or performance by the Company of
this Agreement or the Other Agreements or the issuance and sale by the Company of the Shares.
(xviii) Title to Property. The Company and each of its Designated Subsidiaries have good and marketable title to all
real property owned by them and good title to all other property owned
by them, in each case subject only to such mortgages, pledges, security interests, claims and other liens and encumbrances
(collectively "Liens") and such exceptions, defects and qualifications as (A) are described in the Registration Statement and
the Prospectus or (B) would not reasonably be expected to result in a Material Adverse Effect.
(xix) Leases. All of the leases and subleases material to the business of ttre Company and its Designated Subsidiaries,
considered as one enterprise, and under which the Company or any of such subsidiaries holds properties, described in or
required to be described in the Registration Statement and the Prospectus are in full force and effect, and the Company has no
notice ofany claim ofany sort asserted by anyone adverse to the rights ofthe Company or any ofsuch subsidiaries under any
of such leases or subleases, or affecting or questioning the righs of the Company or any of such subsidiaries to the continued
possession of the premises leased or subleased thereunder, that would reasonably be expected to result in a Material Adverse
Effect.
(xx) Invesfinent Comoany Act. The Company is not, and upon the issuance and sale of the Shares as contemplated
herein and in the Other Agreements and the application of the net proceeds therefrom as described in the Regisnation
Statement, the Disclosure Package and the Prospectus will not be, an "investment company" or an entity "controlled" by an
"investment company" as such terms are defined in the Investment Company Act of 1940, as amended.
( x x i ) Environmental Laws. Except as described in ttre Registration Statement, the Disclosure Package and the
Prospectus, neither the Company nor any of the Designated Subsidiaries (A) is in violation of any statute, rule, regulation,
decision or order of any govemmental body or any court, domestic or foreign, relating to the use, disposal or release of
hazardous or toxic substances or other pollutants or contaminants, to the protection or restoration of the environment or to
human or animal exposure to hazardous or toxic substances or other pollutants or contaminants that have the potential to
adversely impact human or animal health (collectively, "environmental laws"), (B) owns or operates any real property
contaminated with any hazardous or toxic substances or other pollutants or contaminants that is subject to clean-up or other
responsive action under any environmental laws, (C) is liable for any off-site disposal or contamination pursuant to any
environmentat laws, (D) is subject to any claim of violation of or liability under any environmental laws, which violation,
contamination, liability or claim would individually or in the aggregate reasonably be expected to have a Material Adverse
Effect; and the Company is not aware of any pending investigation or circumstances which would reasonably be expected to
lead to such a claim.
(xxii) Internal Controls. (A) The Company has devised and established and maintains the following, among other,
intemal controls (without duplication):
(D a system of "intemal accounting controls" as contemplated in Section l3(bX2XB) of the 1934 Act
(the "Accounting Controls");
(D "intemal control over financial reporting" as such term is defined in Rule l3a-15(f) of the 1934 Act
Regulations; and
(IID "disclosure controls and procedures" as such term is defined in Rule l3a-15(e) of ttre 1934 Act
Regulations (the "Disclosure Controls" and, together with *re Accounting Controls and the Reporting Controls,
the "Internal Controls"));
(B) The Internal Controls are evaluated by the Company's senior management periodically as appropriate and,
in any event, as required by law;
(C) Based on the most recent evaluations of the Intemal Controls:
(D the Internal Controls are, individually and in the aggregate, effective in all material respects to
perform the functions for which they were established; and
(ID all material weaknesses, if any, and significant deficiencies, if any, in the design or operation of the
Internal Controls which are reasonably likely to adversely affect the Compaay's ability to record, process,
summarize and report financial information and any fraud, whether or not material, that involves management or
other employees who have a significant role in the Internal Controls have been disclosed to the audit committee
of the Company's board of directors and the Company's independent auditors.
(xxiii) Comoliance with Sarbanes-Oxley. The Company is in compliance in all material respects with the Sarbanes-
Oxley Act of 2OO2 and the rules and regulations of the Commission that have been adopted thereunder, to the extent that such
act and such rules and regulations are in effect and applicable to the Company.
(xxiv) Finder's Fees. The Company has not incurred (directly or indirectly) nor will it incur, directly or indirectly, any
liability for any broker's, finder's, financial advisor's or other similar fee, charge or commission in connection with this
Agreement or the Other Agreements, or the transactions contemplated hereby or thereby, except as set forth in or
contemplated by this Agreement and the Other Agreements.
(xxv) Sanctions. Neither the Company nor any of its subsidiaries, nor, to the knowledge of the Company, any director;
officer or agent of the Company or any of its subsidiaries is currently the subject or the target of any sanctions administered by
the Office of Foreign Assets Control of the U.S. Department of the Tieasury or any other applicable sanctions laws or
regulations ("Sanctions"), nor is the Company or any of its subsidiaries located, organized or resident in a country or territory
that is the subject or ttre target of Sanctions, including, without limitation, Cuba, Iran, North Korea, Sudan and Syria (each, a
"Sanctioned Country"); and the Company will not directly or indirectly use the proceeds of the offering of the Shares
hereunder, or lend, contribute or otherwise make available such proceeds to any person or entity, (A) to fund or facilitate any
activities of orbusiness with any person that, at the time of such funding or facilitation, is the subject or the target of Sanctions
or (B) to fund or facilitate any activities of or business in any Sanctioned Country or (C) in any other manner that will result in
a violation by any person (including any person participating in the transaction, whether as sales agen! advisor, investor or
otherwise) of Sanctions.
(xxvi) Comoliance with Money Laundering Laws. The operations of the Company and its subsidiaries are and have
been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency
and Foreign Tiansactions Reporting Act of 1970, as amended, the applicable money laundering statutes of all jurisdictions in
which the Company and/or any of its subsidiaries conducts business, the rules and regulations thereunder and any related or
similar rules, regulations or guidelines issued, administered or enforced by any governmental or regulatory agency
(collectively, the "Anti-Money Laundering Laws"); and no action, suit or proceeding by or before any court or
governmental or regulatory agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with
respect to the AntiMoney Laundering Laws is pending or, to the knowledge of the Company, threatened.
(xxvii) No Unlawful Payments. Neither the Company nor any of its subsidiaries, nor, to the knowledge of the
Company, any director, officer or agent of the Company or any of its subsidiaries, has violated or is in violation of any
provision of the Foreign Comrpt Practices Act of 1977, as amended (the "FCPA") or any other applicable anti-comrption
and/or anti-bribery laws and regulations. The Company and the and its subsidiaries have instituted and maintain policies and
procedures designed to promote and provide reasonable assurance as to compliance with the FCPA.
(b) Olficer's Certificates. Any certificate signed by any offrcer of the Company delivered to the SalesAgent or to counsel for
the Sales Agent in connection with the offer and sale of the Shares shall be deemed a representation and warrangr by the Company to
the Sales Agent as to the matters covered thereby.
SECTION 3. Offers and Sales of Shares.
(a) Initiation of Sales Efforts. Upon the terms and subject to the conditions set forth herein, on any Trading Day during the
Commitment Period the Company may deliver to the Sales Agent a Sales Notice, and, upon the commencement of the Selling Period
specified in such Sales Notice, which shall not be earlier than the Trading Day next succeeding the date of receipt by the Sales Agent of
such Sales Notice, the Sales Agent shall use its Commercially Reasonable Efforts to sell the number of Shares specified in such Sales
Notice. The Company acknowledges that there can be no assurance that the Sales Agent will be successful in selling the Shares and
agrees that *re Sales Agent shall incur no liability or obligation to the Company if it does not sell Shares for any reason other than a
failure by the Sales Agent to use its Commercially Reasonable Efforts to sell such Shares in accordance with the terms of this
Agreement.
(b) Manner of Offer and Sales. (i) The offering and sale of Shares under this Agreement (other than sales to or by the Sales
Agent as principal) shall be made by such methods permitted by law as the Sales Agent shall determine from time to time that are
deemed to be "at-the-market offerings" within the meaning of Rule al5(a)(a) of the 1933 Act Regulations, including sales made
directly on the NYSE, through an "alternative trading system" as defined in Rule 300 of Regulation ATS under the 1934 Act or any
other electronic communications network or to or through a market maker;prcvided, however, that, if the Company and the Sales
Agent so agree in writing, sales may be made in privately negotiated transactions;
(ii) If the Company and the Sales Agent so agree in a separate Terms Agreement (it being understood and agreed that neither
party is under any obligation to do so), the Company may sell Shares to the Sales Agent acting as principal, and the Sales Agent may
purchase such Shares acting as principal, it being understood that, in the event of any inconsistency between the terms and provisions
of this Agreement and those of the Terms Agreement, those of the Terms Agreement shall control.
(c) Sales Price.' (i) Sales of Shares by the Sales Agent acting as agent in At the Market Offerings or to or through a market
maker shall be made at prevailing market prices per Share or, if and to the extent so specified in the related Sales Notice, at prices per
Share related to prevailing market prices. Anything in this Agreement to the contrary nonvithstanding, (a) in no event shall the Sales
Price for any Shares so sold be less than the Floor Price set forth in the related Sales Notice and (b) the Company shall
not establish any Floor Price that would not be within the limitations prescribed by the Board of Directors of the Company.
(ii) Sales of Shares by the Sales Agent as agent in privately negotiated transactions, and the public offering of Shares
purchased by the Sales Agent acting as principal, shall be made at such Sales Prices as shall be agreed upon by the Company and the
Sales Agent in the particular case, such agreement by the Company to be within the limitations prescribed by the Board of Directors of
the Company.
(iii) The Selling Commission in respect of Shares sold hereunder in At the Market Offerings or to or through a market maker
shall be such percentage (not to exceed 2%) of the Sales Price thereof, as agreed upon by the Company and the Sales Agent from time
to time, provided, however, that the Selling Commission in respect of all sales hereunder that (A) are made under a Terms Agreement,
(B) made in a transaction that constitutes a "distribution" within the meaning of Rule 100 of Regulation M of the 1934 Act Regulations
or (C) are otherwise not At the Market Offerings or to or through a market maker shall be agreed upon by the Company and the Sales
Agent in the particular case.
(d) Confirmation of Sales. The Sales Agent shall deliver to the Company, not later than the opening of the Trading Day next
following each Trading Day on which it makes sales of Shares hereunder, a confirmation setting forth (i) the number of Shares sold in
each transaction on such Trading Day, (ii) the applicable Sales Price for each such sale ofShares, (iii) the aggregate Sales Price for each
such transaction and (iv) the Net koceeds payable to the Company for each such transaction.
(e) Settlement of Sales. Subject to the conditions set forth in Section 6, each sale of Shares hereunder shall be settled on the
Settlement Date therefor. No later than l2:00 Noon (New York City time) on the Settlement Date, the Company shall cause its transfer
agent, currently Computershare Shareholder Services LLC, to electronically transfer such Shares to the Sales Agent by crediting the
account of the Sales Agent or its designee or nominee at the Depository Trust Company through its Deposit/Wthdrawal at Custodian
System, or by such other means of delivery as may be mutually agreed upon by the Company and the Sales Agent in writing. Upon
notification that the Shares have been issued, Sales Agent shall deliver the total Net Proceeds for the sale of all Shares to be settled on
such Settlement Date by wire fiansfer of immediately available funds to an account designated by the Company in the related Sales
Notice.
( f ) Suspension of Sales. The Company or the Sales Agent may, upon notice to the other party in writing or by telephone
(confirmed immediately by verifiable facsimile transmission, e-mail or other customary means of electronic communication), suspend
the offering or sale of Shares, and the Selling Period shall immediately terminate; provided, however, that such suspension and
termination shall not affect or impair eittrer party's obligations with respect to any Shares sold hereunder prior to the prompt processing
of such notice of suspension.
G) Proprietary Trading by the Sales Agent. The Sales Agent has advised the Company that during the Commitment Period the
Sales Agent and/or its affiliates may purchase and sell shares of Common Stock for their respective accounts and for the accounts of
their respective customers;provided, however, that (i) no such purchase or sale shall violate any provision of applicable law (including
particularly but without limitation the 1933 Act or the 1934 Act or any regulation under either thereof) and (ii) no sale of shares of
Common Stock shall be made by the Sales Agent for the account of the Sales Agent during any Selling Period unless (A) such sale is
made pursuant to and in accordance with the terms of a Terms Agreement, (B) such sale is a sale by the Sales Agent of shares
purchased, or deemed to have been purchased, from the Company as a "riskless principal" or in a similar capacity, (C) such sale is
made in trading transactions in the ordinary course of business but only if neither the Company nor the
Sales Agent is in violation of Regulation M of the I 934 Act Regulations or (D) the Company shall have consented thereto.
(h) Limitations. Anything in this Agreement to the contrary notwithstanding:
(D in no event shall the aggregate number of Shares sold pursuant to this Agreement, together with ttre aggtegate
number of Shares sold pursuant to the Other Agreements (as disclosed to the Sales Agent from time to time by the Company),
exceed the Maximum Number (the Company hereby acknowledging and agreeing that the Sales Agent shall have no
responsibility for maintaining records with respect to the aggregate number of Shares sold (other than the Shares sold under this
Agreement));
(ii) in no event shall the Sales Agent be obligated to make any offer or sale of Shares during any period in which either
party has reason to believe that the Common Stock is not an excepted security under Rule 101(c)(l) of Regulation M of the
1934 Act Regulations; and
(iii) in no event shall the Company sell Shares through both *re Sales Agent and any Other Sales Agent on the same
Trading Day; without limiting the generality of the foregoing, in no event shall the Selling Period designated in a Sales Notice
delivered to the Sales Agent include a Tiading Day that is included in a selling period that is in effect under one of the Other
Agreements; and each of the Other Agreements shall contain the limitations sets forth in this clause (iii).
SECTION 4. Covenants.
(a) Preparation and Filing of the Prospecfus. The Company will prepare the Prospectus and, after affording the SalesAgent
the opportunity to comment thereon, file the Prospectus with the Commission in accordance with Rule 424(b) r,ot later than the
Commission's close of business on the second business day following ttre Closing Time.
( b ) Review of Amendments and Supplements. The Company will not amend the Registration Statement, or amend or
supplement the Prospectus, without providing notice to the Sales Agent at least 24 hours, or such shorter period as is reasonably
required by the circumstances, prior to the filing thereof with the Commission. Except in the case of any such amendment or
supplement to be made by the filing under the 1934 Act of a document that will be incorporated by reference in the Registration
Statement or the hospectus that would be made by the Company irrespective of the offer and sale of the Shares, the Company will not
effect such amendment or supplement without the consent of the Sales Agent, such consent not to be unreasonably withheld or delayed.
Neither the consent of the Sales Agent, nor the delivery of any such amendment or supplement by the Sales Agent, shall constitute a
waiver of any of the conditions set forth in Section 6 hereof.
The Company will notifu the Sales Agent immediately, and confirm such notice in writing, when any post-effective
amendment to the RegisFation Statement shall have been filed or shall become effective and when any supplement to the Prospectus or
any amended Prospectus shall have been filed.
(c) Free Writing Prospectuses. (i) The Company has not made and, without the consent of the Sales Agent, will not make any
offer relating to the Shares that would constitute a "free writing prospectus" as defined by Rule 405, including an Issuer Free Writing
Prospectus.
(ii) The Sales Agent has not made, and without the consent of the Company shall not make, any offer relating to the Shares
that would constitute a "free writing prospectus" (as defined in Rule 405) that the Company would be required to file with the
Commission under Rule 433.
(d) Notification of Commission Comments and Orders, Etc. . The Company will notiff the Sales Agent of (i) the receipt of any
comments from the Commission with respect to the Registration Statement, any Issuer Free Writing Prospecfus or the Prospectus,
including any request by the Commission for any amendment, supplement or additional information with respect thereto and (ii) the
issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of any order preventing or
suspending the use of any Issuer Free Writing Prospectus or the Prospechrs or the initiation or threatening of any proceeding for such
purpose. The Company will make every reasonable effort to prevent the issuance of any stop order and, in the event of any stop ordeq
to obtain the lifting thereof as soon as possible.
(e) Delivery of Registration Statements. The Company will deliver to the Sales Agent and to counsel for the Sales Agent, upon
request and without charge, one conformed copy of ttre Registration Statement as originally filed and of each amendment thereto
(including, in each case, all exhibits filed therewith or incorporated by reference). Such copies of the Registration Statement and
amendments thereto so fumished to the Sales Agent will be identical to the copies thereof filed elecronically with the Commission
pursuant to EDGAR (except that the registration fee table may be deleted from the cover thereof), except to the extent permitted by
Regulation S-T.
(f ) Delivery of Pruspectuses. The Company will fumish to the Sales Agent, without charge, during the period when the
Prospectus (or, in lieu thereof, the notice referred to in Rule 173(a) of the 1933 Act Regulations) is required to be delivered of the 1933
Act Regulations, such number of copies of the Prospectus as the Sales Agent may reasonably request. Such copies of the Prospectus so
furnished to the Sales Agent will be identical to the copies thereof filed electronically with the Commission pursuant to EDGAR (except
that the registration fee table may be deleted from the cover thereof), except to the extent permitted by Regulation S-T. The Company
will deliver to the Sales Agent, without charge, as many copies of any Issuer Free Writing Prospectus as the Sales Agent shall
reasonably request, and the Company hereby consents to the use ofsuch copies by the SalesAgent for purposes ofthe offer and sale of
the Shares in a manner consistent with the 1933 Act and the 1933 Act Regulations.
(g) Continued Compliance with Securities Laws. (i) The Company will file all reports and other documents that it is required to
file with the Commission pursuant to Sections l3(a), l3(c), 14 or l5(d) of the 1934 Act within the time periods required by the 1934
Act and ttre 1934 Act Regulations and will otherwise comply with the 1933 Act, the 1933 Act Regulations, the 1934 Act and ttre 1934
Act Regulations so as to permit the offer, sale and distribution of the Shares as contemplated in this Agreement and the Prospectus;
provided, however, that the Company may assume that the distribution of the Shares issued on any Settlement Date has been completed
on the business day following such Settlement Date unless the Sales Agent shall have provided written notice to the conffary.
(iD During the distribution of the Shares, the Company will notiSr the Sales Agent promptly if (A) any filing is made by the
Company of information relating to the offering of the Shareswith any securities exchange orany otherregulatory body in the United
States or any other jurisdiction or (B) a Material Adverse Change shall have occurred that is not disclosed in the Registration Statement
and the Prospectus or (C) any other event shall have occurred that causes (x) the Registration Statement to contain any untrue statement
of material fact or omit to state any material fact necessary in order to make the statements therein not misleading or (y) the Disclosure
Package or the Prospecfus to contain any untrue statement of material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were made, not misleading.
(iii) Upon any notification pursuant to clause (ii)(B) or (C) above, or if at any time an event shall occur or other circumstances
shall exist as a result of which it is necessary, in the reasonable judgment of the Company or of the Sales Agent, (A) to amend the
Registration Statement in order that it shall not, as of the Effective Time, include any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein not misleading or otherwise to comply with the requirements of the
1 93 3 Act or the I 933 Act Regulations or (B) to amend or supplement the Prospectus in order that it shall not, as of any Initiation Date,
any Applicable Time within any Selling Period or any Settlement Date, contain any untrue statement of material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of the circumstances existing at such time, not misleading or
otherwise to comply with the requirements of the 1933 Act or the 1933 Act Regulations,
(A) the Company will promptly prepare and file with the Commission, subject to Section 4(b), such amendment or
supplement as may be necessary to correct such statement or omission or to make the Registratiol Statement or the Prospecfus
comply with such requirements, and the Company will furnish to the Sales Agent such number of copies of such amendment or
supplement as the Sales Agent may reasonably request;
(B) the Company shall not deliver to the Sales Agent any Sales Notice until such statement or omission is corrected;
and
(C) if such time shall be during a Selling Period specified in a Sales Notice theretofore delivered to the Sales Agent, the
Company shall promptly, by telephone (confitmed by elecfonic mail), cancel such Sales Notice and direct the Sales Agent to
cease selling Shares and making offers for such sales.
(h) Blue Slcy QualiJications. The Company will use is best efforts, in cooperation with the Sales Agent, to take such action, if
any, as may be required to qualiff the Shares for offering and sale under the applicable securities laws of such states and other
jurisdictions as the Sales Agent may reasonably designate and to maintain such qualifications in effect as long as required for the
distribution of the Shares; provided,however, that the Company shall notbe obligated to file any general consent to service of process
or to qualiff as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to
taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject. In the event that the Company becomes
aware of the suspension of the qualification of the Shares for offering or sale in any jurisdiction, or of the initiation or threatening of any
proceedings for any of such purposes, the Company will so notiff the Sales Agent and will cooperate with the Sales Agent to endeavor
to prevent any such suspension and, in the event ofany such suspension, to obtain the lifting thereofas soon as possible.
(i) Rule I 5 8 . The Company will timely file such reports pursuant to the 1 934 Act as are n€cessary in order to make generally
available to its securityholders as soon as practicable an eamings statement for the purposes of, and to provide the benefits
contemplated by, the last paragraph of Section I I (a) of the I 933 Act and Rule 15 8 thereunder (which earnings statement need not be
audited unless required so to be under Section I l(a) of the 1933 Act).
() Filing Fees. The Company agrees to pay the required Commission filing fees relating to the Shares within the time required
by Rule 456OX1) of the 1933 Act Regulations and otherwise in accordance with Rules 456(b) and 457(r) of the 1933 Act Regulations.
( k ) Use of Pruceeds. The Company will use the Net Proceeds received by it from the sale of the Shares in the manner
specified in the Prospectus under "Use of Proceeds".
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(l) Restriction on Sale of Shares. The Company will not (A) at any time during any Selling Period without the prior written
consent of the Sales Agent or (B) at any time during the term of this Agreement without giving the Sales Agent at least three Tiading
Days'prior written notice specifring the nature and timing of the proposed sale, directly or indirectly, offer to sell, contract to sell, sell,
grant any option to buy or otherwise dispose of any shares of Common Stock or securities convertible into or exchangeable for shares
of Common Stock or warrants or rights to purchase or acquire shares of Common Stock. The foregoing restrictions shall not restrict tle
Company's issuance or sale of (i) shares of Common Stock pursuant to this Agreement or the Other Sales Agreements, (ii) shares of
Common Stock, options to purchase shares of Common Stock or shares of Common Stock issuable upon the exercise of options, in any
case pursuant to any employee or director stock option or benefit plan, stock purchase or ownership plan or dividend reinvestment plan
of the Company, (iii) shares of Common Stock issuable upon ttre conversion of securities or the exercise of warrants, options or other
rights disclosed in the Registration Statement and the Prospectus or (iv) shares of Common Stock issuable as consideration in
connection with acquisitions of business, assets or securities of other entities by merger or otherwise.
( m ) Maximum Number. The Company will promptly notiff the Sales Agent and each of the Other Sales Agens when the
Maximum Number of Shares has been sold.
( n ) Regulation M. If either the Company or the Sales Agent shall have reason to believe that the Common Stock is not an
excepted security under Rule l0l(c)(1) of Regulation M of the 1934 Act Regulations, it shall promptly notiff the other party and the
Sales Agent may suspend sales of Shares under this Agreement or any Terms Agreement until, in the judgment of each party, ttre
Common Stock is such an excepted security.
(o) Diligence Cooperation. The Company shall reasonably cooperate with any reasonable due diligence review requested by
the Sales Agent or its counsel from time to time in connection with the transactions contemplated hereby or any Terms Agreement,
including, without limitation, on or about each Primary Delivery Date and each Secondary Delivery Date, providing information and
making available appropriate documents and appropriate corporate officers of the Company and, upon reasonable request,
representatives of Deloitte & Touche LLP.
SECTION 5. Payment ofExpenses.
( a ) Expenses Payable by the Company. The Company will pay all expenses incident to the performance of its obligations
under this Agreement, including (i) the preparation, printing and filing of the Registration Statement (including financial statements and
exhibits) as originally filed and of each amendment thereto, (ii) the preparation, printing and delivery to the Sales Agent of this
Agreement and such other documents as may be required in connection with the offering, purchase, sale, issuance or delivery of the
Shares, (iii) the preparation, issuance and delivery ofthe certificate or certificates for the Shares, (iv) the fees and disbursements ofthe
Company's counsel, accountants and other advisors, (v) the qualification of the Shares under securities laws in accordance with the
provisions of Section 4(h) hereof, (vi) the printing and delivery to the Sales Agent of copies of each Issuer Free Writing Prospectus and
of the Prospectus and any amendments or supplements thereto, (vii) the preparation, printing and delivery to the Sales Agent of copies
of any Blue Sky survey and any supplement thereto, (viii) the costs and expenses of the Company relating to investor presentations on
any "road show" undertaken in connection with the marketing of the Shares, including without limitation, expenses associated with the
production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the road show
presentations, travel and lodging expenses of the Sales Agent and oflicers of the Company and any such consultants, and the cost of
aircraft and other transportation chartered in connection with the road show and (ix) the reasonable documented out-of-pocket expenses
of the Sales Agent, including the reasonable fees and disbursements of counsel for the Sales Agent, in connection with the negotiation,
t7
execution and delivery of this Agreement and the performance of its obligations hereunder during the Commitnent Period, it being
understood that the Company shall be required to pay the fees and disbursements of only one counsel for the Sales Agent and the Other
Sales Agents.
( b ) Expenses Payable by the Sales Agent. Except as provided in subsection (a) above and subsection (c) below, the Sales
Agent will pay all of its expenses incurred in connection with the transactions contemplated hereby, including the fees and
disbursements of any counsel for the Sales Agent (other than the one counsel for the Sales Agent and Other Sales Agents contemplated
in subsection (a)(ix) above).
(c) Expenses (Jpon krmination.lf this Agreement is terminated by the Sales Agent in accordance with fte provisions of
Section 6 or Section l0(aXi) hereof, the Company shall reimburse the Sales Agent for all of its out-of-pocket expenses incurred in
connection with the transactions contemplated hereby, including the reasonable fees and disbursements of the one counsel for the Sales
Agent and the Other Sales Agents contemplated in subsection a(ix) above.
SECTION 6. Conditions of the Sales Agent's Obligations: Termination of Agreement.
( u ) Conditions. The obligations of the Sales Agent hereunder are subject to the accuracy, as of the Closing Time and each
otherRepresentation Date, of the representations and warranties of the Company contained in Section 2(a) hereof and in all certificates
of officers of the Company delivered pursuant to the provisions hereof, to the performance by the Company of its covenants and other
obligations hereunder to be performed at or prior to the Closing Time and each other Representation Date, and to the following further
conditions:
( i ) No Stop Order; Commission Filings. At the Closing Time and each subsequent Representation Date, the
Regishation Statement shall remain effective and no stop order suspending the effectiveness of the Regiskation Statement shall
have been issued under the 1933 Act or proceedings therefor initiated or threatened by the Commission and the Company
shall not have received from the Commission any notice pursuant to Rule 0 I (g)(2) of the I 933 Act Regulations objecting to
use of tlte automatic shelf registration statement form, and any request on the part of the Commission for additional
information shall have been complied with to the reasonable satisfaction of counsel to the Sales Agent; the Prospectus shall
have been filed with the Commission in accordance with Rule 424(b); any material required to be filed by the Company
pursuant to Rule 433(d), shall have been filed with the Commission in accordance with the applicable time period prescribed
for such filing under Rule 433; and the Company shall have paid the required Commission filing fees relating to the Shares
within the time period required by Rule 456OXlXi) of the 1933 Act Regulations without regard to the proviso therein and
otherwise in accordance with Rules 456(b) and 457(r) of the 1933 Act Regulations and, if applicable, shall have updated the
"Calculation of Registration Fee" table in accordance with Rule 456(b)(lXii) of the 1933 Act Regulations either in a post-
effective amendment to the Regisftation Statement or on the cover page of a prospectus filed pursuant to Rule 424(b).
(ii) Opinions of Counselfor the Company. (A)Atthe Closing Time and within five Tiading Days after the date on
which the Company shall amend the Registration Statement and/or amend or supplement the Prospectus (in each case other
than by means of the incorporation by reference of documents filed with the Commission) or the date on which the Company
shall file an Annual Report on Form l0-K (each such date being herein called a "Primary Delivery Date"), the Sales Agent
shall have received the opinions, dated the date of delivery thereof, of Marian M. Durkin, Esq., SeniorVice President, General
Counsel and Chief
Compliance Officer of the Company, and Pillsbury Winthrop Shaw Pittman LLI counsel for the Company, substantially in the
form of Exhibits B and C hereto, respectively.
(B) Within five Trading Days afterthe date on which the Company shall file a Quarterly Reporton Form l0-Q ora
Current Report on Form 8-K (except to the extent that any such Current Report "furnishes" rather than "files" the information
provided therein), and at any other time reasonably requested by the Sales Agent (each of such dates being herein called a
"Secondary Delivery Date"), the Sales Agent shall have received the opinions, dated the date of delivery thereof, of counsel
referred to in clause (A) above, substantially in the form of Exhibits B and C hereto, respectively;provided, however, that such
counsel may deliver, in lieu of such opinions, a reliance letter to the effect that the Sales Agent may rely on the opinion
delivered on the next preceding Primary Delivery Date to the same extent as if it were dated the date of such letter (except that
the statements in such prior opinion shall be deemed to relate to the Registration Statement as amended and the Prospectus as
amended and/or supplemented as of such Secondary Delivery Date).
(iii) Opinion of Counselfor the Sales Agent. At the Closing Time and each otherPrimary Delivery Date, Secondary
Delivery Date relating to a Quarterly Report on Form l0-Q and, if and to the extent reasonably requested by the Sales Agent,
each other Secondary Delivery Date, the Sales Agent shall have received the opinion, dated the date of delivery thereof, of
Choate, Hall & Stewart LLP, counsel for ttre Sales Agent, as to such matters as the Sales Agent shall reasonably request. In
giving such opinion such counsel may rely, as to all matters govemed by the laws of jurisdictions other than the law of the
State of New York and the federal law of the United States upon the opinions of counsel to the Company. Such counsel may
also state that, insofar as such opinion involves factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and certificates of public officials.
(iv) No Material Adverse Change; OlJicers'Certificate. (A) At the Closing Time and each other Representation Date,
there shall not have been since the date of the latest audited balance sheet included in the Registration Statement and the
Prospectus and except as disclosed therein, any Material Adverse Change and (B) at the Closing Time and at each other
himary Delivery Date and each Secondary Delivery Date, the Sales Agent shall have received a certificate of the President or
a Vice President of the Company and of the chief financial or chief accounting officer of the Company, dated the date of
delivery thereof, to the effect ttrat (I) there has been no such Material Adverse Change, (II) the representations and warranties
in Section 2(a) hereof are true and correct with the same force and effect as though expressly made at and as of such date, (ID
the Company has complied with all agreements and satisfied all conditions on its part required by this Agreement to be
performed or satisfied at or prior to such date, and (IV) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been instituted or are pending or, to the knowledge of the
signers, contemplated by the Commission.
( v ) Accountantb Comfort Letter. At the Closing Time and within five Trading Days after each date on which the
Company shall file an Annual Report on Form 10-K, a Quarterly Report on Form lO-Q or a Current Report on Form 8-K that
contains financial statements of the Company (other than any Current Report on Form 8-K that is "furnished" to and not
"filed" with the Commission), the Sales Agent shall have received from Deloitte & Touche LLP a letter dated the date of
delivery thereof, in form and scope consistent with the internal guidelines of such firm for the delivery of comfort letters and,
in any event, in form and substance reasonably satisfactory to the Sales Agent, containing statements and information of the
type customarily included in accountants' "comfort letters" to underwriters with respect to the
l9
financial statements of, and certain financial information relating to, the Company contained in the Registration Statement,
Disclosure Package and the Prospectus.
("i) Additional Conditions. At the Closing Time and on each other Representation Date, none of the events enumerated
in clauses (D, (ii), (iii) and (iv) of Section l0(a) shall have occurred.
(viD Additional Documents. At the Closing Time and on each other Primary Delivery Date and each Secondary
Delivery Date, the Sales Agent and counsel for the Sales Agent shall have been furnished with such additional documents and
opinions as they may reasonably require for the purpose of enabling such counsel to pass upon the issuance and sale of the
Shares as herein contemplated, or in order to evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings taken by the Company in connection with the
issuance and sale of the Shares as herein contemplated shall be reasonably satisfactory in form and substance to the Sales
Agent and counsel for the Sales Agent. For the avoidance ofdoubt, it is understood and agreed that the Sales Agent shall not
have any obligation to offer or sell any Shares during the period commencing on any Primary Delivery Date or Secondary
Delivery Date, as the case may be, through the date on which all deliverables triggered by such Primary Delivery Date or
Secondary Delivery Date, as the case may be, have been satisfactorily delivered to the Sales Agent.
(viii) Additional Conditionsfor "Distributions ". If the Company shall direct the Sales Agent to offer and sell Shares in
a transaction ftat would constitute a "distribution" within the meaning of Rule 100 of Regulation M of the 1934 Act
Regulations, the Company will provide the Sales Agent: (A) at the Sales Agent's request and upon reasonable advance notice
to the Company, on or prior to the Settlement Date in respect of such sale, the opinions of counsel and oflicers' certiflcates
pursuant to Sections 6(a)(ii), (iii) and (iv) hereof, each dated such Settlement Date, (B) at the Sales Agent's request and upon
reasonable advance notice to the Company, on or prior to the Settlement Date in respect of such sale, a customary
"bringdown" comfort letter from Deloitte & Touche LLP and (C) such other documents and information as the Sales Agent
shall reasonably request.
(b) Tbrmination of Agreement.If any condition specified in this Section shall not have been fulfilled when and as required to
be fulfrlled and shall not be waived by the Sales Agent, this Agreement may be terminated by the Sales Agent by notice to the
Company, and such termination shall be without liability of any party to any other party, except as provided in Section 5 and except
that Sections 2,7,8 and 9 shall survive any such termination and remain in full force and effect.
( c ) Increase of Maximum Number. The Company may at any time increase the Maximum Number to any number by
delivering to the Sales Agent:
(D a notice executed by the President or a Senior Vice President of the Company stating that the Maximum Number
shall be increased to the number specified in such notice;
(iD a certificate signed by the individuals specified in Section 6(aXiv) to the effect that the representations and
warranties in Section 2(a)(x) and 2(a)(xvii) are true and correct with respect to the Maximum Number as to be increased;
20
(iii) a certificate signed by the individuals and to the effect specified in Section 6(aXiv), with the proposed Maximum
Number being substituted for the existing Maximum Number;
(i") opinions of counsel for the Company, as specified in Section 6(a)(ii), reflecting the Maximum Number as to be
increased;
(v) a revised Prospectus reflecting the Maximum Number as to be increased; and
(vi) such additional documents as shall be reasonably required by the Sales Agent and counsel for the Sales Agent for
purposes analogous to those specified in Section 6(aXvi).
Upon the satisfaction of the foregoing conditions, the Maximum Number shall be increased as specified, without further act, for all
purposes of this Agreement.
SECTION 7. Indemnification.
( a ) Indemnification of the Sales Agent. The Company shall indemniff and hold harmless the Sales Agent, its affiliates,
directors and officers and each person, if any, who conhols the Sales Agent, within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act as follows:
(D against any and all loss, liability, claim, damage and expense whatsoever, as incurred, (A) arising out of any untrue
statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), or
the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements
therein not misleading or @) arising out of any untrue statement or alleged untrue statement of a material fact contained in any
Issuer Free Writing Prospectus, the Disclosure Package or the Prospectus (or any amendment or supplement thereto) or the
omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of ttre
circumstances under which they were made, not misleading;
(iD against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental agency or body,
commenced or threatened, or of any claim whatsoever based upon atry untrue statement or omission of a material fact, or any
alleged untrue statement or omission of a material fact, in either case of the nature described in clause (i) above; provided that
any such settlement is effected with the written consent of the Company; and
(iiD against any and all expense whatsoever, as incurred (including tlre fees and disbursements of counsel chosen by
the Sales Agent), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid
under (i) or (ii) above;
provided, however, that this Section 7 shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with written information
furnished to the Company by the Sales Agent
expressly for use in the Registration Statement (or any amendment thereto), any Issuer Free Writing Prospectus, the Disclosure Package
or the Prospectus (or any amendment or supplement thereto).
( b ) Indemnification of the Company. The Sales Agent shall indemniff and hold harmless the Company, its directors and
officers, and each person, if any, who controls the Company within the meaning of Section l5 of the 1933 Act or Section 20 of the
1934 Act against any and all loss, liability, claim, damage and expense described in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or omissions of a material fact, or alleged untrue statements or omissions of a material fact, made in
the Registration Statement (or any amendment thereto) or any Issuer Free Writing Prospectus, the Disclosure Package or the Prospectus
(or any amendment or supplement thereto) in reliance upon and in conformity with written information furnished to the Company by
the Sales Agent expressly for use therein.
(c) Actions against Parties; Notification. Each indemnified party shall give notice as promptly as reasonably practicable to
each indemniffing party of any action commenced against it in respect of which indemnity may be sought hereunder, but failure to so
notiff an indemniffing party shall not relieve such indemni$,ing party from any liability hereunder to the extent it is not materially
prejudiced as a result thereof and in any event shall not relieve it from any liability which it may have otherwise than on account of this
Section 7. In the case of parties indemnified pursuant to Section 7(a), counsel to the indemnified parties shall be selected by the Sales
Agent, and, in the case of panies indemnified pursuant to Section 7(b), counsel to the indemnified parties shall be selected by the
Company. An indemnifuing party may participate at its own expense in the defense of any such action; provided, however, that counsel
to the indemniffing party shall not (except with the consent of the indemnified party) also be counsel to the indemnified party. In no
event shall the indemniffing parties be liable for fees and expenses of more than one counsel (in addition to any local counsel) separate
from their own counsel for all indemnified parties in connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances. No indemniffing party shall, without *re prior written
consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect to any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever in respect of
which indemnification could be sought under this Section 7 or contibution could be sought under Section 8 hereof (whether or not the
indemnified parties are actual or potential parties thereto), unless such settlement, compromise or consent (i) includes an unconditional
release of each indemnified party from all liability arising out of such litigation, investigation, proceeding or claim and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.
SECTION 8. Contribution.
If the indemnification provided for in Section 7 hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified parfy in respect of any losses, liabilities, claims, damages or expenses referred to therein, then each indemnifing party
shall confibute to the aggtegate amount of such losses, liabilities, claims, damages and expenses incurred by such indemnified party,
(i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Sales Agent on
the other hand from the offering of the Shares pursuant to this Agreement or (ii) if the allocation provided by clause (i) is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company on the one hand and of the Sales Agent on the other hand in connection with the statements or omissions
which resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and the Sales Agent on the other hand in connection with the
oflering of the Shares pursuant to this Agreement shall be deemed to be in the same respective proportions as the total net proceeds
from the offering of the Shares pursuant to this Agreement (after the Sales Agent's commission or discount, but before expenses)
received by the Company and the total commissions and/or discounts received by the Sales Agent, bear to the aggregate public offering
price ofthe Shares.
The relative fault of the Company on the one hand and the Sales Agent on the other hand shall be determined by reference to,
among other things, whether any such untrue or alleged untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company or by the Sales Agent and ttre parties'relative intent, knowledge, access to
information and opporfunity to correct or prevent such statement or omission.
The Company and the Sales Agent agree that it would not be just and equitable if contribution pursuant to this Section 8 were
determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations
referred to above in this Section 8. The aggregate amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 8 shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in investigating, preparing or defending against any litigation, or any investigation or proceeding by any
govemmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement of a material fact or omission or allege d omission of a material fact.
Notwithstanding the provisions of this Section 8, the Sales Agent shall not be required to contribute any amount in excess of
the amount by which the total amount in respect of commissions or underwriting discounts received by the Sales Agent pursuant to this
Agreement exceeds the amount of any damages which the Sales Agent has otherwise been required to pay by reason of any such
untrue or alleged unffue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of Section ll(f) of the 1933 Act) with respect to the
offering of Shares pursuant to this Agreement shall be entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.
For purposes of this Section 8, each affiliate, director and officer of the Sales Agent and each person, if any, who controls the
Sales Agent within the meaning of Section l5 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to contribution
as the Sales Agen! and each director of the Company, each officer of the Company, and each person, if any, who controls the
Company within the meaning of Section l5 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to contribution as
the Company.
SECTION 9. Representations. Warranties and Agreements to Survive.
All of the respective representations, warranties and agreemens of the Company and the Sales Agent contained in this
Agreement, or in certificates of offrcers of the Company delivered pursuant to this Agreement, shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of *re Sales Agent or controlling person of the Sales Agent, or by or on
behalf of the Company, or any director, officer or controlling person of the Company, and shall survive delivery of and payment for the
Shares.
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SECTION 10. Termination of Agreement.
(a) Termination b1t the Sales Agent.T'he Sales Agent may terminate this Agreement, at any time
(i) if there has been since the date of the latest audited balance sheet included in the Registration Statement and the
Prospectus any Material Adverse Change, or
(iD bankruptcy, insolvency, reorganization, or liquidation proceedings or other proceedings for relief under any other
law for the relief of debtors shall have been institute d by or against the Company or any Designated Subsidiary, or
(iii) the Company or any Designated Subsidiary shall have made an assignment for the benefit of creditors or shall
have applied to the appoinrnent of a receiver or trustee for such entity or for all or substantially all of is property or business, or
such a receiver or trustee shall otherwise have been appointed, or
(iv) the Common Stock shall no longer be listed on the NYSE, or
(v) if there has occurred any material adverse change in the financial markets in the United States or in the
intemational financial markets, any outbreak of hostilities or escalation thereof or other calamity or crisis or any change or
development involving a prospective change in national or international political, financial or economic conditions, in each case
the effect of which is such as to make it, in the judgment of the SalesAgent, impracticable or inadvisable to offer, sell or deliver
the Shares or to enforce conffacts for the sale ofthe Shares, or
(vi) if trading in the Common Stock has been suspended or materially limited by the Commission or the New York
Stock Exchange, or if trading generally on the New York Stock Exchange or the NYSE MKT. or in the NASDAQ Global
Market or the NASDAQ Global Select Market has been suspended or materially limited, or minimum or maximum prices for
trading have been fixed, or maximum ranges for prices have been required, by either of such exchanges or Nasdaq Stock
Market, Inc. with respect to such markets or by order of the Commission or any other governmental authority, or
(vii) a material disruption has occurred in commercial banking or securities settlement or clearance services in the
United States, or
(viii) if a banking moratorium has been declared by either federal or New York authorities.
The Sales Agent may terminate this Agreement for any other reason, upon ten days' advance notice to the Company.
(b) Termination by the Company. The Company may terminate this Agreement at any time, upon one Tiading Day's advance
notice to the Sales Agent.
(c) Liabilities.If this Agreement is terminated pursuant to this Section, such termination shall be without liability of any party
to any ottrer party except as provided in Section 5 hereof; and,pruvided, furthea that Sections 2,7,8 and 9 shall survive such
termination and remain in full force and effect.
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SECTION I l. Notices.
(a) General. Except as hereinafter provided, all notices, requests and other communications hereunder shall be in writing and
shall be deemed to have been duly given if received by mail, elechonic mail ortransmitted by any standard form of telecommunication
to the addresses set forth in this section or to such other address as such party shall have specified most recently by written notice.
Notices to the Sales Agent shall be directed to it at BNY Mellon Capital Markets, LLC, Equity Capital Markets, 101 Barclay Street, 3W,
New York, New York 10286, attention: Daniel C. de Menocal, Fax No. [phone], with copies (which shall not constitute notice)
to: BNYMellon Capital Markets, LLC, Legal Dept., l0l Barclay Street,3W, NewYork, NewYork 10286, attention: Michael Okon,
Fax No. [phone]; BNYMellon Capital Markets, LLC, Operations Deparffnent, l0l Barclay Street, 3W, NewYork, NewYork
10286, Fax No. (724) 540-63 ll; and Choate, Hall & Stewart LLP, Two International Place, Boston, MA 02110, attention: Andrew J.
Hickey, Esq., Fax No. [phone]; and notices to the Company shall be directed to it at l4ll East Mission Avenue, Spokane,
Washington 99202, attention: Treasurer, Fax No. [phone], e-mail: [e-mail].
( b ) Sales Notice; Confirmation and Settlement of Sales; Suspension of Sales. All Sales Notices shall be executed by an
individual named on Schedule A hereto who is the President, a Senior Vice President, a Vice President, the Treasurer or an Assistant
Tieasurer of the Company, and shall be delivered to any of the personnel of the Sales Agent listed on Schedule A hereto. Any
comments by the Sales Agent on any Sales Notice shall be delivered to any of the personnel of the Company listed on Schedule A
hereto. All notices and other correspondence to and from the Company and the Sales Agent with respect to the confirmation and
settlement of sales of Shares or suspension of sales of Shares shall be delivered to the personnel of the Company and the Sales Agent
listed on Schedule A hereto. Either party may update its personnel listed on Schedule A by written notice to the other party.
SECTION 12. Parties in Interest.
This Agreement shall inure to the benefit of and be binding upon the Sales Agent and the Company and thet respective
successors. Nothing expressed in this Agreement is intended or shall be construed to give any person, firm or corporation, other than
*re Sales Agent and the Company and their respective successors and the controlling persons and officers and directors referred to in
Sections 7 and 8 and their heirs and legal representatives, any legal or equitable right, remedy or claim under or in respect of this
Agreement or any provision herein contained. This Agreement and all conditions and provisions hereof are intended to be for the sole
and exclusive benefit of the Sales Agent and the Company and their respective successors, and said controlling persons and officers
and directors and their heirs and legal representatives, and for the benefit of no other person, firm or corporation. No purchaser of
Shares from ttre Sales Agent shall be deemed to be a successor by reason merely of such purchase.
SECTION 13. No Advisory or Fiduciary Relationshio.
The Company acknowledges and agrees that (a) the offering and sale of the Shares pursuant to this Agreement, including the
determination of the public offering price of the Shares and any related commissions and discounts, is an arm's-length commercial
transaction between the Company, on the one hand, and the Sales Agent, on the other hand, (b) in connection with the offering
contemplated hereby and the process leading to such transaction, the Sales Agent is and has been acting solely on its own behalf and is
not the agent or fiduciary of the Company, or its shareholders, creditors, employees or any other party, (c) the Sales Agent has not
assumed and will not assume an advisory or fiduciary responsibility in favor of the Company with respect to the offering contemplated
hereby or the process leading thereto (irrespective of whether the Sales Agent has advised or is currently advising the Company on
other matters) and the Sales Agent has no obligation to ttre Company with respect to the offering contemplated hereby except the
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obligations expressly set forth in this Agreement, (d) the Sales Agent and its affiliates may be engaged in, and may in the future engage
in, a broad range of transactions that involve interests that differ from those of the Company and (e) the Sales Agent has not provided
any legal, accounting, regulatory or tax advice with respect to the offering contemplated hereby, and the Company has consulted its
own legal, accounting, regulatory and tax advisors to the extent it deemed appropriate.
SECTION 14. Governing Law and Time.
This agreement and any claim, controversy or dispute relating to or arising out of this Agreement shall be governed by
and construed in accordance with the internal laws of the State of New York applicable to agreements made and to be performed
within the State of New York without giving effect to principles of conflicts of laws thereof . Specified times of day refer to New
York City time. Any action, suit or proceeding to enforce any provision of, or based on any matter arising out of or in connection with,
this Agreement or the transactions contemplated hereby shall be brought in any federal court located in the Southem District of the State
of New York or any New York state court located in the Borough of Manhattan, and the Company agrees to the exclusive jurisdiction
of such courts (and of the appropriate appellate courts therefrom), and each party waives (to the full extent permitted by law) any
objection it may have to the laying of venue of any such suit, action or proceeding in any such court or that any such suit, action or
proceeding has been brought in an inconvenient forum.
SECTION 15. Waiver of Jurv Trial.
The Company and the Sales Agent each hereby irrevocably waives any right it may have to a trial by jury in respect of any
claim based upon or arising out of this Agreement or any ftansaction contemplated hereby.
SECTION 16. Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all such counterparts
shall together constitute one and the same agreement.
SECTION 17. Entire Agreement.
This Agreement supersedes all prior and contemporaneous agreements and understandings (whether written or oral) between
the Company and the Sales Agent with respect to the subject matter of this Agreement.
SECTION 18. Effect of Headings.
The Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof.
SECTION 19. No Assignment.
No party may assign its rights or delegate its duties or obligations under this Agreement widrout the consent of the other party.
Any purported assignment or delegation of rights, duties or obligations hereunder shall be void and of no effect. Notwithstanding the
foregoing, the Sales Agent may assign its rights under this Agreement and/or may delegate some or all of is duties and obligations
under this Agreement, without the consent of the Company, to an affrliate of the Sales Agent that is a registered broker-dealer, it being
understood that no such assignment or delegation shall release the Sales Agent from any of its obligations hereunder.
SECTION 20. Severabilitv.
This Agreement and each Terrns Agreement shall be deemed severable, and the invalidity or unenforceability of any term or
provision hereof or thereof shall not affect the validity or enforceability hereof or thereof or of any term or provision hereof or thereof.
Furthermore, if any term or provision of this Agreement or any Terms Agreement is determined to be invalid or unenforceable, there
shall be deemed to be made to such term or provision such minor changes (and only such minor changes) as shall be necessary to make
it valid and enforceable.
If the foregoing is in accordance with your understanding of our agreement please sign and return to the Company a
counterpart hereot whereupon this instrument along with all count€rparts, will become a binding agreement between the Sales Agent
and the Company in accordance with its temrs.
Very truly yours,
AVISTA CORPORATION
By: /s/ Mark T. Thies
Name: Mar* T. Thies
Title: SeniorVicePresident,
Chief Financial Offi cer and
Treasurtr
Signature Page to Sales Ageacy Agreement
CONFIRMED AI.ID ACCEPTED,
as ofthe date first above written
BNY MELLON CAPITAL MARKE'TS, LLC
/s/ Daoiel C. de Menocal, Jr.
Name: Daniel C. de Menocal, Jr.
Title: Managing Director
Signature Page to Sales Agency Agreement
SCIIEDULE A
Contact Persons
The Comoanv
Mark T. Thies
Senior Vice President, Chief Financial Officer and Treasurer
[e-mail]
T:509-495-4639
Ryan L. Krasselt
Vice President, Controller and Principal Accounting Offrcer
[e-mail]
T:509-495-2273
Don M. Falkner
Assistant Treasurer
Don. [e-mail]
T:509-495-4326
Richard N. Stevens
Assistant Treasurer and Director of Finance
Rich. [e-mail]
T:509-495-4330
Lauren Pendergraft
Senior Treasury Analyst
[e-mail]
T:509-495-2998
Solely for notices and other correspondence to the Company with respect to the conlirmation and settlement of sales of
Shares, please include:
Denise Bums
Cash Management Analyst
[e-mail]
T:509-495-4725
Treasury Departrnent
treasurv(0avistacom. com
The Sales Agent
Daniel C. de Menocal, Jr.
Managing Director
[e-mail]
T:212-815-4995
F:212-815-6403
Schedule A-1
SALES NOTICE
EXHIBIT A
lDatel
BNY Mellon Capital Markets, LLC
Attention: Daniel C. de Menocal, Jr.
Tel. No. 212-815-4995
Fax No.: 212-815-6/,03
E-Mail:
Reference is made to the Sales Agency Agreement between Avista Corporation (the "Company") and BNY Mellon Capital Markets, LLC, dated as of
March 2, 2016 (capitalized terms herein having the meanings assigned thereto in such Agreement). The Company confirms that all conditions to the
delivery of this Sales Notice are satisfied as of the date hereof. As of the date hereof, neither the Prospectus nor the Disclosure Package contains an
untnre statement of a material fact or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
First date of Selling Period:
Last date of Selling Period:
Number of days in Selling Period:
Settlement Date(s):
Number of Shares:
Floor Price*:
Company Bank Account
Third Trading Day after each sale
$-___-per share
*The Floor Price shown above shall be applicable to any Shares to be sold during such Selling Period. Such Floor Price may be adjusted by the
Company during such Selling Period. Notwithstanding the foregoing, in no event shall the Sales Price for any Shares be less than $_ below
the last sale price at which the Company's Common Stock was quoted on the record of composite ffansactions reported by The Wall Street
Journal on the Trading Day immediately preceding the day for fixing the price of such Shares.
Additional Restrictions:
Comments:
AVISTACORPORATION
By:
Name:
ITitle:
I To be executed by the Presidart, any Vice President, the Treasurer or any Assistant Treasurer of the Company.
Exhibit A-l
Exhibit 1.2
AVISTA CORPORATION
(a Washington corporation)
Common Stock
SALES AGENCY AGREEMENT
Dated: March 2,2016
Table of Contents
Certain Definitions
Representations and Warranties
(a) Representations and Waruanties of the Company
(i)
(ii)
(i ii)
(iv)
(v)
("i)
Pape
I
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SECTION I
SECTION2
SECTION 3.
SECTION4.
Compliance with Securities Law Requirements
Incorporated Documents
lndependent Accountants
Financial Statements
No Material Adverse Change
Good Standing ofthe Company and Designated Subsidiaries
(vii) No Significant Subsidiaries
(viii) Capitalization
(ix)Authorization of this Agreement
(x) Authorization ofthe Shares
(xi)Description ofthe Common Stock
(xii) Registration; Listing
(xiii) Actively Traded Securities
(xiv) Absence of Defiults
(xv)No Conflict
(xvi) Absence ofProceedings
(xvii) AbsenceofFurtherRequircments
(xviii) TitletoProperty
(xix) Leases
(x*)Investment Company Act
(xxi) Environmental Laws
(xxii) Intemal Controls
(xxiii) CompliancewithSarbanes-Oxley
(xxiv) Finder's Fees
(xxv) Sanctions
(xxvi) Compliance with Money Laundering Laws
(xxvii) No Unlawful Payments
(b) fficer's C ertiJicates
Offers and Sales ofShares
(a) Initiatiott of Sales Effurts
(b) Manner of Offer and Sales
(c) Sales Pice
(d) ConJirmation of Sales
(e) Settlement of Sales
(f) Suspension of Sales
(g) Propietary Trading by the Sales Agent
Qr\ Limitations
Covenants
(a) Preparation and Filing of the Prospectus
(b) Review ofAmendments and Supplemenls
(c) Free Writing Prospectuses
(d)Notification of Comtnission Comments and Orders, Etc.
(e) Delivery of Regislration Statements
(f) Delivery of Prospectuses
(g\ Conlinued Compliance wilh Securities laws
(h) Blue SIE Qualificdtions
(i)Rule 158
$ Filing Fees
(k) Use of Proceeds
(l) Reslriction on Sale of Shares
(m) Maxinum Number
(n) Regulation M
(o) Diligence Co op erati on
Payment ofExpenses
(a) Expenses Payable by the Company
(b) Expenses Payable by the Sales Agent
(c'1 Exp enses Up on Termination
Conditions of the Sales Agent's Obligations; Termination of Agreement
(a) Conditions
(D
(ii )
(iii)
(iv)
(v)
(vi)
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SECTION 5.
SECTION6.
SECTIONT.
SECTION 8.
SECTION9.
SECTION IO.
SECTION I I.
No Stop Oder; Commission Filings
Opinions ofCounselfor the Company
Opinion of Counselfor the Sales Agent
No Mareial Adverse Change; fficers' CertiJicate
A c c o un tan t's C o mfo rt Itt t er
Additional Conditions
(vii) Additional Documents
(viii) AdditionalConditionsfor"Dstributions"
@) Termination of Agreement
(c) Increase of Maximum Number
Indemnification
(a) IndemniJication of the Sales Agent
(b) IndemniJication of the Conpany
(c) Actions against Parties ; No tification
Contribution
Representations, Warranties and Agreements to Survive
Termination of Agreement
(a) Termination by the Sales Agent
(b) Termination by the Con4oany
(c) Liabililies
Notices
SECTION 12.
SECTION 13.
SECTION 14.
SECTION I5.
SECTION 16.
SECTION 17.
SECTION I8.
SECTION 19.
SECTION20.
SCIIEDULES
Schedule A
EX{IBITS
ExhibitA
(a) General
(b) Sal* Notice; Conlinnation and Settlement of Sales; Suspewion of Sales
Parties in Interest
No Advisory or Fiduciary Relationship
Goveming Lawand Time
WaiverofJury Trial
Counterparts
Etrtirc Agrecment
Effect ofHeadings
No Assignment
Severability
Contact Persons
Form ofSales Notice
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AVISTA CORPORATION
(a Washington corporation)
Common Stock
SALES AGENCY AGREEMENT
March 2,2016
CREDIT SUISSE SECURITIES (USA) LLC
Eleven Madison Avenue
New York, NY 10010
Ladies and Gentlemen:
Avista Corporation, a Washington corporation (the "Company"), conhrms its agreement (the "Agreement") wittr Credit
Suisse Securities (USA) LLC (the "Sales Agent"), whereby the Company, subject to the terms and conditions set forth herein, may from
time to time offer shares ("Shares") of its Common Stock, without nominal or par value ("Common Stock"), and the Sales Agent,
subject to such terms and conditions, shall offer Shares for sale as the Company's sales agent or, in limited circumstances with the
agreement of both the Company and the Sales Agent, may purchase Shares as principal.
The Company may enter into one or more agreements substantially identical to this Agreement (each an "Other Agreement")
with other investment banking firms as sales agents (each an "Other Sales Agent") whereby, subject to the terms and conditions set
forth herein and therein, the Company may from time to time offer Shares and the Other Sales Agent party thereto, subject to such terms
and conditions, shall offer Shares for sale as the Company's sales agent ot in limited circumstances with the agreement of bottr the
Company and such Other Sales Agent, may purchase Shares as principal.
The maximum number of Shares that *re Company may issue and sell under this Agreement and all the Other Agreements,
collectively, is the Maximum Number (as hereinafter defined).
On February 25,2016, the Company filed with the Securities and Exchange Commission (the "Commission") a registration
statement on Form S-3 (No. 333-209714), for the registration of securities, including the Shares, under the Securities Act of 1933, as
amended (the "1933 Act"), and the offer and sale thereof from time to time in accordance with Rule 415 of the rules and regulations of
the Commission under the 1933 Act (the "1933 Act Regulations").
SECTION l. Certain Definitions
When used in this Agreement, the following terms have the meanings specified below:
"Accounting Controls" has the meaning set forth in Section 2(a)(xxii)(!.
"Agreements and Instruments" has the meaning set forth in Section 2(a)(xiv).
"Applicable Time" means the time of each sale of Shares pursuant to this Agreement.
"Base Prospectus" means the base prospectus relating to the Shares filed as part of the Registration Statement, in the form in
which it has been most recently filed with the Commission prior to the Closing Time.
"Closing Time" means the time and date of the execution and delivery of this Agreement.
"Commercially Reasonable Efforts" means, with respect to the obligation of ttre Sales Agent to offer and sell Shares,
commercially reasonable efforts consistent with its normal trading and sales practices and in compliance with applicable law.
"Commission" has the meaning forth in the preamble to this Agreement.
"Commitment Period" means the period commencing on March 2, 2016 and expiring on the earliest to occur of (a) the first
date on which the Maximum Number of Shares shall have been sold under this Agreement and/or the Other Agreements, (b) the date
this Agreement is terminated pursuant to Section 6 or Section l0 and (c) February 29,2020.
"Common Stock' has the meaning set forth in the preamble to this Agreement.
"Company" has the meaning set forth in the preamble to this Agreement.
"Designated Subsidiary" means each of Avista Capital, Inc., Alaska Energy and Resources Company and Alaska Electric
Light and Power Company.
"Disclosure Controls" has the meaning set forth in Section 2(aXxxii)0ll).
"Disclosure Package" means, collectively, (i) the Prospechrs as of any particular time and (ii) any other Issuer Free Writing
Prospectus relating to ttre offer and sale of the Shares (to the extent not superseded or modified by the Prospectus or by a subsequent
Issuer Free Writing Prospectus).
"EDGAR" has the meaning set forth below in this Section l.
"Effective Time" means the date and time of the effectiveness of the Registration Statement for purposes of paragraph (f)(2)
of Rule 4308 of the 1933 Act Regulations ("Rule 4308"), as applied to the Sales Agent.
"Floor Price" means the minimum Sales Price set by the Company in a Sales Notice for any Selling Period, as such Sales
Notice may be amended from time to time during such Selling Period. The Floor Price may, in addition to setting an absolute minimum
dollar amount per Share, also be limited by reference to recent or prevailing market prices.
"Initiation Date" means each date of delivery of a Sales Notice pursuant to Section 3(a).
"Internal Controls" has the meaning set forth in Section 2(aXxxiiX[I).
"Issuer Free Writing Prospectus" means any "issuer free writing prospectus" (as defined by Rule 433 of the 1933 Act
Regulations ("Rule 433")) with respect to the Shares.
"Liens" has the meaning set forth in Section 2(a)(xviii).
"Material Adverse Change" has the meaning set forth in Section 2(aXv).
"Material Adverse Effect" has the meaning set forth in Section 2(a)(vi).
"Maximum Number" means 3,795,199 or such higher number as shall be established pursuant to Section 6(c).
"Net Proceeds", with respect to any Shares sold hereunder, means the aggregate Sales Prices for such Shares less the Selling
Commission in respect of the sale of such Shares (but before other expenses).
"NYSE" means the New York Stock Exchange.
"Other Agreement" has the meaning set forth in the preamble to this Agreement.
"Other Sales Agent" has the meaning set forth in the preamble to this Agreement.
"Primary Delivery Date" has the meaning set forth in Section 6(a)(ii).
"Prospectus" means, as of any particular time, the Base Prospectus, as supplemented by the final prospectus supplement
relating to the offer and sale of the Shares, as filed with the Commission pursuant to Rule 424b), together with any further supplements
or amendments thereto at such time.
"PUC Orders" has the meaning forth in Section 2(aXxvii).
"Registration Statemenf' means, as of any particular time, the Company's registation statement on Form S-3 (No. 333-
209714), including (a) any amendments thereto at such time, (b) the exhibits and schedules thereto at such time (other than the
Statement of Eligibility on Form T-l) and (c) any prospectus filed with the Commission pursuant to Rule 424(b)that, in accordance
with Rule 430B, is deemed to be a part thereof; provided, however, that, if a new registration statement shall have been filed and shall
have become effective on or about the third anniversary of the initial effective date of registration statement No. 333-2097 14, the term
"Registration Statement" shall mean, at and after the time of the effectiveness of such new registration statement, such new registration
statement, including amendments, exhibits and any prospectus as aforesaid.
"Regulation S-T" means Regulation S-T of the Commission.
"Repayment Event" has the meaning set forth in Section 2(a)(xv).
"Representation Date" has the meaning set forth in Section 2(a).
"Rule 405" means Rule 405 of the 1933 Act Regulations.
"Rule 424(b)" means Rule 424(b) of the I 933 Act Regulations.
"Sales Agent" has the meaning set forth in the preamble to this Agreement.
"Sales Notice" means a written notice, substantially in the form of Exhibit A hereto, executed by an individual named in
Schedule A hereto who is the President, a Senior Mce President, a Vice President, the Tieasurer or an Assistant Tieasurer of the
Company and delivered to the Sales Agent in accordance with this Agreement. Any Sales Notice may be amended by the Company and
the Sales Agent and, from and after the time of such amendment the term "Sales Notice" shall mean the original Sales Notice as
amended. Any Sales Notice or amendment to a Sales Notice shall be deemed acceptable to the Sales Agent unless the Sales Agent shall
promptly noti$ the Company to the contrary. Each Sales Notice shall be delivered, and may be amended, by facsimile ffansmission, e-
mail or other customary means of elecfionic communication.
"Sales Price", with respect to any Shares sold hereunder, means the price per Share paid to the Sales Agent for such Shares.
"Secondary Delivery Date" has the meaning set forth in Section 6(aXiiXB).
"Selling Commission", with respect to any Shares sold hereunder, means the commission, discount or other compensation to
be received by the Sales Agent in connection with the sale of such Shares.
"Selling Period" means a period of one to 20 consecutive Trading Days specified by the Company in a Sales Notice,
commencing no earlier than the Tiading Day next succeeding the Trading Day on which such Sales Notice is delivered to the Sales
Agent.
"Settlement Date" means, with respect to the sale of any Shares, the third business day following the Trading Day on which
an offer to sell such Shares was accepted.
"Shares" has the meaning set forth in the preamble to this Agreement.
"Terms Agreement" means an agreement between the Company and the Sales Agent that relates to the issuance and sale by
the Company, and the purchase by the Sales Agent as principal (and not as agent), of a specific number of Shares and otherwise
incorporates the terms and provisions of, and is deemed a part of, this Agreement.
"Trading Day" means any day on which the NYSE is open for trading (other than a day on which rading is scheduled to
close prior to its regular weekday closing time).
"1933 Act" has the meaning set forth in the preamble to this Agreement.
"1933 Act Regulations" has meaning sot forth in the preamble to this Agreement.
"1934 Acf'means the Securities Exchange Act of 1934, as amended.
"1934 Act Regulations" means the rules and regulations of the Commission under the 1934 Act.
The foregoing definitions are subject to the following qualifications:
(a) all references in this Agreement to the Registration Statement or the Prospectus or to any of the financial statements,
schedules or other information that is "contained", "included" or "stated" (or other words of like import) therein shall be deemed to
include the information contained in documents filed with the Commission under the 1934 Act that (i) are incorporated, or deemed
incorporated, therein by reference pursuant to Item 12 of Form S-3 under the 1933 Act to the extent such information has not been
superseded or modified in accordance with Rule 412 of the 1933 Act Regulations (as qualified by Rule a30B(g) of the 1933 Act
Regulations) and (ii)(A) in the case of references to the "Registration Statement", are filed with the Commission at or prior to the
Effective Time and (B) in the case of references to the "Prospectus", are filed with the Commission at or prior to the date thereof;
O) all references in this Agreement to an amendment to the Registration Statement shall be deemed to include any document
filed under the I 934 Act subsequent to the date thereof that is deemed incorporated by reference therein pursuant to Item I 2 of Form S-
3 under the 1933 Act;
(c) all references in this Agreement to an amendment or supplement to the Prospectus shall be deemed to include any
document filed under the I 934 Act subsequent to the date thereof that is deemed incorporated by reference therein pursuant to Item I 2
ofForm S-3 under the 1933 Act; and
(d) all references in this Agreement to the Registration Statement, any Issuer Free Writing Prospectus, the Prospectus or any
amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to its
Electronic Data Gathering, Analysis and Retrieval system ("EDGAR").
SECTION 2. Representations and Warranties.
( " ) Reprcsentations and Wan'anties of the Company. The Company represents and warrants to the Sales Agent as of the
Closing Time, each Initiation Date, each Trading Day and each Applicable Tlme within each Selling Period, each Settlement Date, each
date as of which the Registration Statement shall be amended and each date as of which ttre hospectus shall be amended or
supplemented (each such date a "Representation Date") as follows:
Comnliance with Securities Law Reouirements.
(A) Well-Known Seasoned Issuer Status. At the time the Registration Statement was filed with the Commission,
at all relevant determination dates, and at the date hereof, the Company was and is a "well-known seasoned issuer" (as
defined in Rule 405).
(B ) Eligibilitv to Use Form S-3. At the time the Registration Statement was filed with the Commission and at
the time of the most recent amendment, if any, to the Registration Statement for purposes of complying with Section
10(a)(3) of the 1933 Act, the Company met the requirements for use of Form S-3 under the 1933 Act.
( C ) Status and Content of the Registration Statement. The Registration Statement became effective
automatically upon the filing thereof with the Commission under the 1933 Act. No stop order suspending the
effectiveness of the Registration Statement has been issued under the 1933 Act and no proceedings for that purpose
have been instituted by the Commission or are pending or, to the knowledge of the Company, have been threatened or
are contemplated by the Commission, and any request on the part of ttre Commission for additional information with
respect to the Registration Statement has been complied with. At the time the Registration Statement became effective,
and at the Effective Time, *te Registration Statement complied in all material respects with the requirements of the 1933
Act and the 1933 Act Regulations. At the Effective Time, the Registration Statement did not contain an untrue stratement
of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein
not misleading.
(D) Issuer Free Writine Prospectuses. At the earliest time after the filing of the Registration Statement that the
Company or another offering participant made a bona fide offer (within the meaning of Rule 164(hX2) of the 1933 Act
Regulations) of the Shares, the Company was not an "ineligible issuer" as defined in Rule 405. Each Issuer Free Writing
Prospectus, at the time it was filed with the Commission pursuant to Rule 433 or, if it was not required to be so filed, at
ttre time of each use thereof (i) did not include any information that conflicts with (A) information contained in the
Registration Statement including any prospectus or prospectus supplement that is part of the Registration Statemen! and
not superseded or modified, or (B) information contained in the Company's periodic and current reports filed with the
Commission pursuant to Section 13 or l5(d) of the 1934 Act that are incorporated or deemed incorporated by reference
in the Registration Statement, and not superseded or modified, and (ii)
complied in all other respects with the requirements of Rule 164 and Rule 433 (without reliance on subsections (b), (c)
and (d) of Rule I 64 of the I 933 Act Regulations). No order preventing or suspending the use of any Issuer Free Writing
Prospectus has been issued by the Commission.
( E ) Content of the Disclosure Package. The Disclosure Package, at the Closing Time and at each Initiation
Date, each Applicable Time within each Selling Period and each Settlement Date, will not contain any untrue statement
of material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(F) Stahrs and Content of the Prospectus. The Prospectus, at the Closing Time, as of its date and at the time it is
filed with the Commission and at each Initiation Date, each Applicable Time within each Selling Period and each
Settlement Date, will conform in all material respects with the requirements of the 1933 Act and the 1933 Act
Regulations and, as of such respective dates, will not contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of the circumstances under which they were
made, not misleading. The Prospectus delivered to the Sales Agent in connection with the offering of the Shares, and
any amendment or supplement thereto, will be identical to the copies thereof filed electronically with the Commission
pursuant to EDGAR (except that the registration fee table will be deleted from the cover thereof), except to the extent
permitted by Regulation S-T.
(G) Descriotion and Filing of Contracts and Documents. All contracts or documents that are required to be
described in the Regiskation Statement or the Prospectus or to be filed as exhibis to the Registration Statement have
been so described and filed as required.
The representations and warranties in this subsection (a)(i) shall not apply to any statements in or omissions from the
Registration Statement, any Issuer Free Writing hospectus, the Disclosure Package or the Prospectus made in reliance upon and
in conformity with information furnished to the Company in writing by the Sales Agent expressly for use therein.
(ii) Incomorated Documents. The documents incorporated or deemed incorporated by reference in the Registration
Statement and the Prospectus, at the time they were or hereafter are filed wittr the Commission, complied or will comply, as
applicable, in all material respects with the requirements of the 1934 Act and the 1934 Act Regulations and, when filed did not
and will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not misleading.
(iiD Independent Accountants. The accountants who audited the financial statements and financial statement schedules
included in the Regishation Statement, the Disclosure Package and the Prospectus are independent registered public
accountants within the meaning of Regulation S-X of the Commission.
(iv) Financial Statements. The financial statements, together with the respective schedules and notes relating thereto,
included in the Registration Statement, the Disclosure Package and the Prospectus, present fairly the financial position of the
Company and its consolidated subsidiaries atthe dates indicated and the results of operations and cash flows of the Company
and its consolidated subsidiaries for the periods specified; such financial statements
have been prepared in conformity with United States generally accepted accounting principles applied on a consistent basis
throughout the periods involved, except as otherwise stated therein. The selected financial data and the summary financial
information included in the Registration Statement, the Disclosure Package and the Prospectus present fairly the information
shown therein and have been compiled on a basis consistent wi*r that of the audited financial statements included in the
Registration Statement. The financial statements and other financial data included in the Registration Statement and the
Prospectus comply in all material respects with the requirements of paragraph (e) of Item l0 of Regulation S-K. The interactive
data in eXtensible Business Reporting Language filed as exhibits to the documents incorporated by reference or deemed to be
incorporated by reference into the Registration Statement and the Prospectus fairly presents the information called for in all
material respects and has been prepared in accordance with the Commission's rules and guidelines applicable thereto. Except
as disclosed in the Registation Statement, the Disclosure Package and the Prospectus, neither the Company nor any of its
subsidiaries has any off-balance sheet arrangements of the character contemplated by Item 303 of Regulation S-K or otherwise
by Section l3G of the 1934 Ac! or has any other contingent obligation or liability, which, in any case, is material, or is
reasonably likely to be material, to the Company and is consolidated subsidiaries considered as one enterprise.
( v ) No Material Adverse Change. Since the date of the latest audited balance sheet included in the Registration
Statement, the Disclosure Package and the Prospectus and except as disclosed therein, there has been no material adverse
change, or any development that could reasonably be expected to result in a material adverse change, in the condition
(financial or otherwise), business, properties or results of operations of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business (any such change or development, a "Material Adverse
Change").
(vi) Good Standing of the Company and Designated Subsidiaries. Each of the Company and each of the Designated
Subsidiaries has been duly incorporated and is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation and has the corporate power and authority to own or lease and operate its properties and to
conduct its business as described in the Registration Statement, the Disclosure Package and the Prospectus, and the Company
has the corporate power and authority to enter into and perform its obligations under this Agreement and the Other
Agreements; and the Company is duly qualified as a foreign corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct
of business, except where the failure so to qualiff or to be in good standing would not have a material adverse effect on the
condition (financial or otherwise), business, properties or results of operations of the Company and its subsidiaries considered
as one enterprise, whether or not arising in the ordinary course of business (any such effect, a "Material Adverse Effect").
(vii) No Significant Subsidiaries. The Company has no "significant subsidiaries" as defined in Rule l-02 of Regulation
s-x.
(viii) Capitalization. The authorized, issued and outstanding capital stock of the Company is as set forth in the
Registration Statement and the hospectus. All of the issued and outstanding shares of Common Stock of the Company have
been duly authorized and validly issued and are fully paid and non-assessable. All of the issued and outstanding shares of
capital stock of each Designated Subsidiary have been duly authorized and validly issued, are fully paid and non-assessable
and are owned, directly or indirectly, by the Company, free and clear of any Liens.
( i x ) Authorization of this Agreement. This Agreement has been duly authorized, executed and delivered by the
Company.
( * ) AutJrorization of the Shares. The Shares have been duly authorized by the Company and, when issued and
delivered by the Company pursuant to this Agreement or any of the Other Agreements against payment of the consideration
contemplated herein or therein, will be validly issued, fully paid and non-assessable; no holder of the Shares will be subject to
personal liability in respect of liabilities of the Company solely by reason of being a holder of the Shares; and the issuance of
the Shares is not subject to the preemptive or other similar righs of any securityholder of the Company. Except as disclosed in
the Registration Statement and the Prospectus, there are no outstanding options, warrants, conversion rights, subscription
rights, rights of first refusal or other righs or agreements of any nature outstanding to subscribe for or to purchase any shares
of Common Stock of the Company binding on the Company (except pursuant to dividend reinvestment, stock purchase or
ownership, stock option or other director or employee benefit plans), and 0tere are no outstanding securities or instruments of
the Company containing anti-dilution or similar provisions that will be triggered by the issuance of the Shares as described in
this Agreement or the Other Agreements. Except as disclosed in the Registration Statement and the Prospectus, there are no
restrictions upon the voting or transfer of any shares of the Company's Common Stock pursuant to the Company's Restated
Articles of Incorporation or ByJaws. There are no agreements or other obligations (contingent or otherwise) that may require
the Company to repurchase or otherwise acquire any shares of its Common Stock. No person or entity has the right,
contractual or otherwise, to cause the Company to issue to it, or to register pursuant to the 1933 Act, any shares of Common
Stock upon the filing of the Registration Statement or the issuance or sale of the Shares hereunder. Immediately after any sale
of Shares by the Company under this Agreement and the Other Agreements, the aggregate number of Shares that have been
issued and sold by the Company hereunder and thereunder will not exceed the aggregate amount of Common Stock (A)
registered and available under the Registration Statement or (B) that shall be authorized by the PUC Orders from time to time.
( x i ) Description of the Common Stock. The description of the Common Stock in the Registration Statement, the
Disclosure Package and the Prospectus is accurate in all material resp€cts.
(xii) Registration: Listing. The Common Stock is registered as a class under Section l2(b) of the 1934 Act. The
outstanding shares of Common Stock are listed, and the Shares are authorized for listing (subject to official notice of issuance),
on the NYSE.
(xiii) Activel], Traded Securities. The outstanding shares of Common Stock are "actively faded securities" excepted
from the provisions of Rule l0l of Regulation M of the 1934 Act Regulations by virtue of subsection (c)(l) of such rule.
(xiv) Absence of Defaults. Neither the Company nor any Designated Subsidiary is in violation of its articles of
incorporation or by-laws or in default in the performance or observance of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease or other agreement or
instrument to which the Company or such Designated Subsidiary is a party or by which it or such Designated Subsidiary may
be bound, or to which any of the property or assets of the Company or such Designated Subsidiary is subject (collectively,
"Agreements and Instruments") except for such defaults as, singly or in the aggregate, would not result in a Material Adverse
Effect.
(xv) NoConflict. The execution and delivery by the Company of thisAgreementand the OtherAgreements and the
consummation by the Company of the transactions contemplated herein and therein (including the issuance and sale by the
Company of the Shares and the use of the proceeds from the sale of the Shares as described in the Registration Statement, the
Disclosure Package and the Prospectus) and compliance by the Company with its obligations hereunder and under the Other
Agreements, do not and will no! whether with or without the giving of notice or passage of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined below) under, or result in the creation or imposition of any
Lien upon any property or assets of the Company or any Designated Subsidiary pursuant to, the Agreements and Instruments
(except for such conflicts, breaches, defaults or Liens as, singly or in the aggregate, would not reasonably be expected to result
in a Material Adverse Effect), nor will such action result in any violation of the articles of incorporation or byJaws of the
Company or any Designated Subsidiary or of any statute of any jurisdiction applicable to the Company or any Designated
Subsidiary or any rule, regulation or order applicable to the Company or any Designated Subsidiary of any regulatory body,
administrative agency or other govemmental body or any court that, in any such case, has jurisdiction over the Company or
any Designated Subsidiary or any of their respective assets, properties or operations. As used herein, a "Repayment Event"
means any event or condition that gives the holder of any note, debenture or other evidence of indebtedness (or any person
acting on such holder's behalf) the right to require the repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any Designated Subsidiary.
(xvi) Absence of Proceedings. There is no action, suit, proceeding, inquiry or investigation before or brought by any
court or govemmental agency or body, domestic or foreign, now pending, or, to the knowledge of the Company, threatened,
against or affecting the Company or any of its subsidiaries, that (A) is required to be disclosed in the Regishation Statement or
the Prospectus and is notdisclosed as required, (B) could materially and adversely affectthe consummation of the transactions
contemplated in this Agreement or any of the Other Agreements or the performance by the Company of its obligations
hereunder or thereunder or (C) except as disclosed in the Registration Statement, the Disclosure Package and the Prospectus,
would reasonably be expected to result in a Material Adverse Effect; and the aggregate of all pending legal or govemmental
proceedings to which the Company or any of its subsidiaries is a party or of which any of their respective properties or assets
is the subject that are not described in the Regisftation Statement, the Disclosure Package and the Prospectus, including
ordinary routine litigation incidental to the business, would not reasonably be expected to result in a Material Adverse Effect.
(xvii) Absence of Further Reouirements. The Washington Utilities and Transportation Commission (the "WUTC"), the
Idaho Public Utilities Commission (the "IPUC") and the Public Utility Commission of Oregon (the "OPUC") have issued
orders authorizing the issuance and sale by the Company of the Shares on the terms contemplated in ttris Agreement and the
Other Agreements; the Montana Public Service Commission (the "MPSC") has issued an order disclaiming jurisdiction over
the issuance of securities and the creation of liens by the Company pursuant to, and on the terms set forth in such order (such
order, collectively with the aforesaid orders of the WUTC, the IPUC and the OPUC, being hereinafter called the "PUC
Orders"); the PUC Orders are in full force and effect as of the date hereof; and, except for informational filings required under
the PUC Orders, no further consent, approval or authorization of, or registration, filing or declaration with, any regulatory or
other governmental body or agency is required in connection with the execution, delivery or performance by the Company of
this Agreement or the Other Agreements or the issuance and sale by *re Company of the Shares.
(xviii) Title to Prooerty. The Company and each of its Designated Subsidiaries have good and marketable title to all
real property owned by them and good title to all other property owned by tlrem, in each case subject only to such mortgages,
pledges, security interests, claims and other liens and encumbrances (collectively "Liens") and such exceptions, defects and
qualifications as (A) are described in the Registation Statement and the Prospectus or (B) would not reasonably be expected to
result in a Material Adverse Effect.
(xix) Leases. All of the leases and subleases material to the business of the Company and its Designated Subsidiaries,
considered as one enterprise, and under which the Company or any of such subsidiaries holds properties, described in or
required to be described in the Registration Statement and the Prospectus are in full force and effect, and the Company has no
notice ofany claim ofany sort asserted by anyone adverse to ttre rights ofthe Company or any ofsuch subsidiaries under any
of such leases or subleases, or affecting or questioning the rights of the Company or any of such subsidiaries to the continued
possession of the premises leased or subleased thereunder, thatwould reasonably be expected to result in a MaterialAdverse
Effect.
(xx) Investment Company Act. The Company is not, and upon the issuance and sale of the Shares as contemplated
herein and in the Other Agreements and the application of the net proceeds therefrom as described in the Registration
Statement, the Disclosure Package and the Prospectus will not be, an "investrnent company" or an entity "controlled" by an
"investment company" as such terms are defined in the Investnent Company Act of 1940, as amended.
( x x i ) Environmental Laws. Except as described in the Registration Statement, the Disclosure Package and the
Prospectus, neither the Company nor any of the Designated Subsidiaries (A) is in violation of any statute, rule, regulation,
decision or order of any governmental body or any court, domestic or foreign, relating to the use, disposal or release of
hazardous or toxic substances or other pollutants or contaminants, to the protection or restoration of the environment or to
human or animal exposure to hazardous or toxic substances or other pollutants or contaminants that have the potential to
adversely impact human or animal health (collectively, "environmental laws"), (B) owns or operates any real property
contaminated with any hazardous or toxic substances or other pollutants or contaminants that is subject to clean-up or other
responsive action under any environmental laws, (C) is liable for any off-site disposal or contamination pursuant to any
environmental laws, (D) is subject to any claim of violation of or liability under any environmental laws, which violation,
contamination, liability or claim would individually or in the aggregate reasonably be expected to have a Material Adverse
Effect; and the Company is not aware of any pending investigation or circumstances which would reasonably be expected to
lead to such a claim.
(xxii) Internal Controls. (A)The Company has devised and established and maintains the following, among other,
internal conffols (without duplication):
(I) a system of "intemal accounting controls" as contemplated in Section l3(b)(2XB) of the 1934 Act
(the "Accounting Controls");
(ID "internal control over financial reporting" as such term is define d in Rule l3a-1 5(f) of the 1934 Act
Regulations; and
(III) "disclosure controls and procedures" as such term is defined in Rule 13a-15(e) ofthe 1934 Act
Regulations (the "Disclosure Controls" and, together with the Accounting Controls and the Reporting Controls,
the "Internal Controls"));
(B) The Internal Controls are evaluated by the Company's senior management periodically as appropriate and,
in any even! as required by law;
(C) Based on the most recent evaluations of the Intemal Controls:
(D the Intemal Controls are, individually and in the aggregate, effective in all
perform the functions for which they were established; and
respects to
(D all material weaknesses, if any, and significant deficiencies, if any, in the design or operation of the
Internal Controls which are reasonably likely to adversely affect the Company's ability to record, process,
summarize and report financial information and any fraud, whether or not material, that involves management or
other employees who have a significant role in the Internal Controls have been disclosed to the audit commi$ee
of the Company's board of directors and the Company's independent auditors.
(xxiii) Comoliance with Sarbanes-Oxley. The Company is in compliance in all material respects with the Sarbanes-
Oxley Act of 2002 and the rules and regulations of the Commission that have been adopted thereunder, to the extent that such
act and such rules and regulations are in effect and applicable to the Company.
(xxiv) Finder's Fees. The Company has not incurred (directly or indirectly) nor will it incur, directly or indirectly, any
liability for any broker's, furder's, financial advisor's or other similar fee, charge or commission in connection with this
Agreement or the Other Agreements, or the transactions contemplated hereby or thereby, except as set forttr in or
contemplated by this Agreement and the Other Agreements.
(xxv) Sanctions. Neither the Company nor any of its subsidiaries, nor, to the knowledge of the Company, any director,
officer or agent of the Company or any of its subsidiaries is currently the subject or the target of any sanctions administered by
the O{Iice of Foreign Assets Control of the U.S. Department of the Tieasury or any other applicable sanctions laws or
regulations ("Sanctions"), nor is the Company or any of its subsidiaries located, organized or resident in a country or territory
that is the subject or the target of Sanctions, including, without limitation, Cuba, Iran, North Korea, Sudan and Syria (each, a
"Sanctioned Country"); and the Company will not directly or indirectly use the proceeds of the offering of the Shares
hereunder, or lend, contribute or otherwise make available such proceeds to any person or entity, (A) to fund or facilitate any
activities of or business with any person that, at the time of such funding or facilitation, is the subject or the target of Sanctions
or (B) to fund or facilitate any activities of or business in any Sanctioned Country or (C) in any other manner that will result in
a violation by any person (including any person participating in the transaction, whether as sales agent, advisor, investor or
otherwise) of Sanctions.
(xxvi) Comoliance with Monev Launderins Laws. The ooerations of the Comoanv and its subsidiaries are and have
been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency
and Foreign Transactions Reporting Act of 1970, as amended, the applicable money laundering statutes of all jurisdictions in
which the Company and/or any of its subsidiaries conducts business, the rule s and regulations thereunder and any related or
similar rules, regulations or guidelines issued, administered or enforced by any governmental or regulatory agency
(collectively, the "Anti-Money Laundering Laws"); and no action, suit or proceeding by or before any court or
governmental or regulatory agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with
respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
(xxvii) No Unlawful Payments. Neither the Company nor any of its subsidiaries, nor, to the knowledge of the
Company, any director, officer or agent of the Company or any of its subsidiaries, has violated or is in violation of any
provision of the Foreign Corrupt Practices Act of 1977, as amended (the "FCPA") or any other applicable anti-comrption
and/or anti-bribery laws and regulations. The Company and the and its subsidiaries have instituted and maintain policies and
procedures designed to promote and provide reasonable assurance as to compliance with the FCPA.
(b) Ofiicer's Certificates. Any certificate signed by any officer of the Company delivered to the SalesAgent or to counsel for
the Sales Agent in connection with the offer and sale of the Shares shall be deemed a representation and warranty by the Company to
the Sales Agent as to the matters covered thereby.
SECTION 3. Offers and Sales of Shares.
(a) Initiation of Sales Efforts. Upon the terms and subject to the conditions set forth herein, on any Tiading Day during the
Commitment Period the Company may deliver to the Sales Agent a Sales Notice, and, upon the commencement of the Selling Period
specified in such Sales Notice, which shall not be earlier than the Trading Day next succeeding the date of receipt by the Sales Agent of
such Sales Notice, the Sales Agent shall use its Commercially Reasonable Efforts to sell the number of Shares specified in such Sales
Notice. The Company acknowledges that there can be no assurance that the Sales Agent will be successful in selling the Shares and
agrees that the Sales Agent shall incur no liability or obligation to the Company if it does not sell Shares for any reason other than a
failure by the Sales Agent to use its Commercially Reasonable Efforts to sell such Shares in accordance with the terms of this
Agreement.
(b) Manner of O/ler and Sales. (i) The offering and sale of Shares under this Agreement (other than sales to or by the Sales
Agent as principal) shall be made by such methods permitted by law as the Sales Agent shall determine from time to time that are
deemed to be "at-the-market offerings" within the meaning of Rule a15@)@) of the 1933 Act Regulations, including sales made
directly on the NYSE, through an "alternative trading system" as defined in Rule 300 of Regulation ATS under the 1934 Act or any
other electronic communications network or to or through a market maker;prcvided, however, that, if the Company and the Sales
Agent so agree in writing, sales may be made in privately negotiated ffansactions;
(iD If the Company and the Sales Agent so agree in a separate Terms Agreement (it being understood and agreed that neither
party is under any obligation to do so), the Company may sell Shares to the Sales Agent acting as principal, and the Sales Agent may
purchase such Shares acting as principal, it being understood that, in the event of any inconsistency between the terms and provisions
of this Agreement and those of the Terms Agreement, those of the Terms Agreement shall control.
(c) Sales Price.' (i) Sales of Shares by the Sales Agent acting as agent in At the Market Offerings or to or through a market
maker shall be made at prevailing market prices per Share or, if and to the extent so specified in the related Sales Notice, at prices per
Share related to prevailing market prices. Anything in this Agreement to the conhary notwithstanding, (a) in no event shall the Sales
Price for any Shares so sold be less than the Floor Price set forth in the related Sales Notice and (b) the Company shall
not establish any Floor Price that would not be within the limitations prescribed by the Board of Directors of the Company.
(iD Sales of Shares by the Sales Agent as agent in privately negotiated kansactions, and the public offering of Shares
purchased by the Sales Agent acting as principal, shall be made at such Sales Prices as shall be agreed upon by *re Company and the
Sales Agent in the particular case, such agreement by the Company to be within the limitations prescribed by ttre Board of Directors of
the Company.
(iii) The Selling Commission in respect of Shares sold hereunder in At the Market Offerings or to or through a market maker
shall be such percentage (not to exceed ZYo) of the Sales Price thereof, as agreed upon by the Company and the Sales Agent from time
to time, provided, however, that the Selling Commission in respect of all sales hereunder that (A) are made under a Terms Agreement,
(B) made in a transaction that constitutes a "distribution" within the meaning of Rule 100 of Regulation M of the 1934 Act Regulations
or (C) are otherwise not At the Market Offerings or to or through a market maker shall be agreed upon by the Company and the Sales
Agent in the particular case.
(d) Confirmation of Sales. The Sales Agent shall deliver to the Company, not later than *re opening of the Trading Day next
following each Tiading Day on which it makes sales of Shares hereunder, a confirmation setting forth (i) the number of Shares sold in
each transaction on such Thading Day, (ii) the applicable Sales Price for each such sale ofShares, (iii) the aggregate Sales Price for each
such transaction and (iv) the Net Proceeds payable to the Company for each such tansaction.
(e) Settlement of Sales. Subject to the conditions set forth in Section 6, each sale of Shares hereunder shall be settled on the
Settlement Date therefor. No later than l2:00 Noon (New York City time) on the Settlement Date, the Company shall cause its transfer
agent, currently Computershare Shareholder Services LLC, to electronically transfer such Shares to the Sales Agent by crediting the
account of the Sales Agent or its designee or nominee at the Depository Tiust Company through is Deposit/Withdrawal at Custodian
System, or by such other means of delivery as may be mutually agreed upon by the Company and the Sales Agent in writing. Upon
notification that the Shares have been issued, Sales Agent shall deliver the total Net Proceeds for the sale of all Shares to be settled on
such Settlement Date by wire transfer of immediately available funds to an account designated by the Company in the related Sales
Notice.
( f ) Suspension of Sales. The Company or the Sales Agent may, upon notice to the other party in writing or by telephone
(confirmed immediately by verifiable facsimile transmission, e-mail or other customary means of electronic communication), suspend
the offering or sale of Shares, and the Selling Period shall immediately terminate;provided, however, that such suspension and
termination shall not affect or impair either party's obligations with respect to any Shares sold hereunder prior to the prompt processing
of such notice of suspension.
(g) Proprietary Trading by the Sales Agent.T'he Sales Agent has advised the Company that during the Commitment Period the
Sales Agent and/or its affiliates may purchase and sell shares of Common Stock for their respective accounts and for the accounts of
their respective customers;provided, however, that (i) no such purchase or sale shall violate any provision of applicable law (including
particularly but without limitation the 1933 Act or the 1934 Act or any regulation under either thereof) and (ii) no sale of shares of
Common Stock shall be made by the Sales Agent for the account of the Sales Agent during any Selling Period unless (A) such sale is
made pursuant to and in accordance with the terms of a Terms Agreement, (B) such sale is a sale by the Sales Agent of shares
purchased, or deemed to have been purchased, from the Company as a "riskless principal" or in a similar capacity, (C) such sale is
made in kading transactions in the ordinary course of business but only if neither the Company nor the
l3
Sales Agent is in violation of Regulation M of the I 934 Act Regulations or (D) the Company shall have consented thereto.
(h) Limitations. Anything in this Agreement to the contrary notwithstanding:
(D in no event shall the aggregate number of Shares sold pursuant to this Agreement, together with the aggregate
number of Shares sold pursuant to the Other Agreements (as disclosed to tlre Sales Agent from time to time by the Company),
exceed the Maximum Number (the Company hereby acknowledging and agreeing that the Sales Agent shall have no
responsibility for maintaining records with respect to the aggregate number of Shares sold (other than the Shares sold under this
Agreement));
(ii) in no event shall the Sales Agent be obligated to make any offer or sale of Shares during any period in which either
party has reason to believe that the Common Stock is not an excepted security under Rule lOl(cXl) of Regulation M of the
1934 Act Regulations; and
(iii) in no event shall the Company sell Shares through both the Sales Agent and any Other Sales Agent on the same
Trading Day; without limiting the generality of the foregoing, in no event shall the Selling Period designated in a Sales Notice
delivered to the Sales Agent include a Trading Day that is included in a selling period that is in effect under one of the Other
Agreements; and each of the OtherAgreements shall contain the limitations sets forth in this clause (iii).
SECTION 4. Covenants.
(a) Preparation and Filing of the Prospeclus. The Company will prepare the Prospectus and, after affording the Sales Agent
tlre opportunity to comment thereon, file the Prospectus with the Commission in accordance with Rule 424(b) not later than the
Commission's close of business on the second business day following the Closing Time.
( b ) Review of Amendmen* and Supplements. The Company will not amend the Registration Statement, or amend or
supplement the Prospectus, without providing notice to the Sales Agent at least 24 hours, or such shorter period as is reasonably
required by the circumstances, prior to the filing thereof with the Commission. Except in the case of any such amendment or
supplement to be made by the filing under the 1934 Act of a document that will be incorporated by reference in the Registration
Statement or the Prospectus that would be made by the Company irrespective of the offer and sale of the Shares, the Company will not
effect such amendment or supplement without the consent of the Sales Agent, such consent not to be unreasonably withhe ld or delayed.
Neither the consent of the Sales Agent, nor the delivery of any such amendment or supplement by the Sales Agent, shall constitute a
waiver of any of the conditions set forth in Section 6 hereof.
The Company will notif the Sales Agent immediately, and confirm such notice in writing, when any post-effective
amendment to the Registration Statement shall have been filed or shall become effective and when any supplement to the Prospectus or
any amended Prospectus shall have been filed.
(c) Free Writing Prospectuses. (i) The Company has not made and, without the consent of the Sales Agent, will not make any
offer relating to the Shares that would constitute a "free writing prospectus" as defined by Rule 405, including an Issuer Free Writing
Prospectus.
14
(ii) The Sales Agent has not made, and without the consent of the Company shall not make, any offer relating to the Shares
that would constihrte a "free writing prospectus" (as defined in Rule 405) that the Company would be required to file with the
Commission under Rule 433.
(d) Noti/ication of Commission Comments and Oders, Etc. . The Company will noti$ the Sales Agent of (i) the receipt of any
comments from the Commission with respect to the Registration Statement, any Issuer Free Writing Prospecfus or the Prospectus,
including any request by the Commission for any amendment, supplement or additional information with respect thereto and (ii) the
issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of any order preventing or
suspending the use of any Issuer Free Writing Prospectus or the hospectus or the initiation or threatening of any proceeding for such
purpose. The Company will make every reasonable effort to prevent the issuance of any stop order and, in the event of any stop order,
to obtain the lifting thereof as soon as possible.
(e) Delivery of Registration Statements. The Company will deliver to the Sales Agent and to counsel for the Sales Agent, upon
request and without charge, one conforned copy of the Registration Statement as originally filed and of each amendment thereto
(including, in each case, all exhibib filed therewith or incorporated by reference). Such copies of the Registration Statement and
amendments thereto so furnished to ttre Sales Agent will be identical to the copies thereof filed elecffonically with the Commission
pursuant to EDGAR (except that the registration fee table may be deleted from the cover thereof), except to the extent permitted by
Regulation S-T.
( f ) Delivery of Prcspectuses. The Company will fumish to the Sales Agent, without charge, during the period when the
Prospectus (or, in lieu thereof, the notice referred to in Rule I 73(a) of the 1933 Act Regulations) is required to be delivered of the 1933
Act Regulations, such number of copies of the Prospectus as the Sales Agent may reasonably request. Such copies of the Prospectus so
fumished to the Sales Agent will be identical to ttre copies thereof filed elecfronically with the Commission pursuant to EDGAR (except
that the regishation fee table may be deleted from the cover thereo{), except to the extent permitted by Regulation S-T. The Company
will deliver to the Sales Agent, without charge, as many copies of any Issuer Free Writing Prospectus as the Sales Agent shall
reasonably request, and the Company hereby consents to the use of such copies by the Sales Agent for purposes of the offer and sale of
the Shares in a manner consistent with the 1933 Act and the 1933 Act Regulations.
G) Continued Compliance with Securities Laws. (i) The Company will file all reports and other documents that it is required to
file with the Commission pursuant to Sections 13(a), l3(c), 14 or l5(d) of the 1934 Act within the time periods required by the 1934
Act and the 1934 Act Regulations and will otherwise comply with the 1933 Act, the 1933 Act Regulations, the 1934 Act and the 1934
Act Regulations so as to permit the offer, sale and distribution of the Shares as contemplated in this Agreement and the Prospectus;
provided, however, that the Company may assume that the distribution of the Shares issued on any Settlement Date has been completed
on the business day following such Settlement Date unless the Sales Agent shall have provided written notice to the contrary.
(iD During the distribution of the Shares, the Company will notifu the Sales Agent promptly if (A) any filing is made by the
Company of information relating to the offering of the Shares with any securities exchange or any other regulatory body in the United
States or any other jurisdiction or (B) a Material Adverse Change shall have occurred that is not disclosed in the Registration Statement
and the Prospectus or (C) any other event shall have occurred that causes (x) the Registration Statement to contain any untrue statement
of material fact or omit to state any material fact necessary in order to make the statements therein not misleading or (y) the Disclosure
Package or the Prospectus to contain any untrue statement of material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were made, not misleading.
(iii) Upon any notification pursuant to clause (ii)(B) or (C) above, or if at any time an event shall occur or other circumstances
shall exist as a result of which it is necessary, in the reasonable judgment of the Company or of the Sales Agent, (A) to amend the
Registration Statement in order that it shall not, as of the Effective Trme, include any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein not misleading or otherwise to comply with the requirements of the
1933 Act or the 1933 Act Regulations or (B) to amend or supplement the Prospectus in order that it shall not, as of any Initiation Date,
any Applicable Time within any Selling Period or any Settlement Date, contain any unfue statement of material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of the circumstances existing at such time, not misleading or
otherwise to comply with the requirements of the I 933 Act or the I 933 Act Regulations,
(A) the Company will promptly prepare and file with the Commission, subject to Section 4(b), such amendment or
supplement as may be necessary to correct such statement or omission or to make the Registration Statement or the Prospectus
comply with such requirements, and the Company will furnish to the Sales Agent such number of copies of such amendment or
supplement as the Sales Agent may reasonably request;
(B) the Company shall not deliver to the Sales Agent any Sales Notice until such statement or omission is corrected;
and
(C) if such time shall be during a Selling Period specified in a Sales Notice theretofore delivered to the Sales Agent, the
Company shall promptly, by telephone (confirmed by electronic mail), cancel such Sales Notice and direct the Sales Agent to
cease selling Shares and making offers for such sales.
(h) Blue Slry Qualifications. The Company will use its best efforts, in cooperation with the Sales Agent, to take such action, if
any, as may be required to qualiff the Shares for offering and sale under the applicable securities laws of such states and other
jurisdictions as the Sales Agent may reasonably designate and to maintain such qualifications in effect as long as required for the
distribution of the Shares; provided, however, that the Company shall not be obligated to file any general consent to service ofprocess
or to qualiff as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to
taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject. In the event that the Company becomes
aware of the suspension of the qualification of the Shares for offering or sale in any jurisdiction, or of the initiation or threatening of any
proceedings for any of such purposes, the Company will so notiff the Sales Agent and will cooperate with the Sales Agent to endeavor
to prevent any such suspension and, in the event ofany such suspension, to obtain the lifting thereofas soon as possible.
(i) Rule 158. The Company will timely file such reports pursuant to the 1934 Act as are necessary in order to make generally
available to its securityholders as soon as practicable an earnings statement for the purposes of, and to provide the benefits
contemplated by, the last paragraph of Section I I (a) of the I 933 Act and Rule I 58 thereunder (which earnings statement need not be
audited unless required so to be under Section l1(a) of the 1933 Act).
(j) Filing Fees. The Company agrees to pay the required Commission filing fees relating to the Shares within the time required
by Rule 456(bxl) of the 1933 Act Regulations and otherwise in accordance with Rules 456O) and 457(r) of the 1933 Act Regulations.
( k ) Use of Proceeds. The Company will use the Net Proceeds received by it from the sale of the Shares in the manner
specified in the Prospectus under "Use of Proceeds".
( I ) Restriction on Sale of Shares. The Company will not (A) at any time during any Selling Period without the prior written
consent of the Sales Agent or (B) at any time during the term of this Agreement without giving the Sales Agent at least three Trading
Days'prior written notice specifying the nature and timing of the proposed sale, directly or indirectly, offer to sell, contract to sell, sell,
grant any option to buy or otherwise dispose of any shares of Common Stock or securities convertible into or exchangeable for shares
of Common Stock orwarrants orrights to purchase oracquire shares of Common Stock. The foregoing reskictions shall notrestrictthe
Company's issuance or sale of (i) shares of Common Stock pursuant to this Agreement or the Other Sales Agreements, (ii) shares of
Common Stock, options to purchase shares of Common Stock or shares of Common Stock issuable upon the exercise of options, in any
case pursuant to any employee or director stock option or benefit plan, stock purchase or ownership plan or dividend reinvestment plan
of the Company, (iii) shares of Common Stock issuable upon the conversion of securities orthe exercise of warrants, options orother
rights disclosed in the Registration Statement and the Prospectus or (iv) shares of Common Stock issuable as consideration in
connection with acquisitions of business, assets or securities of other entities by merger or otherwise.
( m ) Maximum Number. The Company will promptly notiff the Sales Agent and each of the Other Sales Agens when the
Maximum Number of Shares has been sold.
( n ) Regulation M. lf either the Company or the Sales Agent shall have reason to believe that the Common Stock is not an
excepted security under Rule l0l (c)(l) of Regulation M of the 1934 Act Regulations, it shall promptly notifu the other party and ttre
Sales Agent may suspend sales of Shares under this Agreement or any Terms Agreement until, in the judgment of each party, the
Common Stock is such an excepted security.
(o) Diligence Cooperation. The Company shall reasonably cooperate with any reasonable due diligence review requested by
the Sales Agent or its counsel from time to time in connection with the transactions contemplated hereby or any Terms Agreement,
including, without limitation, on or about each himary Delivery Date and each Secondary Delivery Date, providing information and
making available appropriate documents and appropriate corporate officers of the Company and, upon reasonable request,
representatives of Deloitte & Touche LLP.
SECTION 5. PaymentofExoenses.
(a) Expenses Payable by the Company.The Company will pay all expenses incident to the performance of its obligations
underthisAgreement, including (i) the preparation, printing and filing of the Registration Statement (including financial statements and
exhibits) as originally filed and of each amendment thereto, (ii) the preparation, printing and delivery to the Sales Agent of this
Agreement and such other documents as may be required in connection with the offering, purchase, sale , issuance or delivery of the
Shares, (iii) the preparation, issuance and delivery of the certificate or certificates for the Shares, (iv) the fees and disbursements of the
Company's counsel, accountants and other advisors, (v) the qualification of the Shares under securities laws in accordance with the
provisions of Section 4(h) hereof, (vi) the printing and delivery to the Sales Agent of copies of each Issuer Free Writing Prospectus and
of the Prospectus and any amendments or suppl€ments thereto, (vii) the preparation, printing and delivery to the SalesAgent of copies
of any Blue Sky survey and any supplement thereto, (viii) the costs and expenses of the Company relating to investor presentations on
any "road show" undertaken in connection with the marketing of the Shares, including without limitation, expenses associated with the
production of road show slides and graphics, fees and expenses of any consultants engaged in connection with ttre road show
presentations, travel and Iodging expenses of the Sales Agent and officers of the Company and any such consultants, and the cost of
aircraft and other fansportation chartered in connection with the road show and (ix) the reasonable documented out-of-pocket expenses
of ttre Sales Agent, including the reasonable fees and disbursements of counsel forthe Sales Agent, in connection with the negotiation,
execution and delivery of this Agreement and the performance of its obligations hereunder during the Commitrnent Period, it being
understood that the Company shall be required to pay the fees and disbursements of only one counsel for the Sales Agent and the Other
Sales Agents.
(b) Expenses Payable by the Sales Agent.Except as provided in subsection (a) above and subsection (c) below, the Sales
Agent will pay all of its expenses incurred in connection with the transactions contemplated hereby, including the fees and
disbursements of any counsel for the Sales Agent (other than the one counsel for the Sales Agent and Other Sales Agents contemplated
in subsection (a)(ix) above).
( c ) Expenses Upon Termination. lf this Agreement is terminated by the Sales Agent in accordance with the provisions of
Section 6 or Section lO(a)(i) hereof, the Company shall reimburse the Sales Agent for all of its out-of-pocket expenses incurred in
connection with the transactions contemplated hereby, including the reasonable fees and disbursements of the one counsel forthe Sales
Agent and the Other Sales Agents contemplated in subsection a(ix) above.
SECTION 6. Conditions of the Sales Agent's Obligations: Termination of Agreement.
(a) Conditions. The obligations of the SalesAgent hereunder are subject to the accuracy, as of the Closing Time and each
otherRepresentation Date, of the representations and warranties of the Company contained in Section 2(a) hereof and in all certificates
of officers of the Company delivered pursuant to the provisions hereof, to the performance by the Company of its covenants and other
obligations hereunder to be performed at or prior to the Closing Time and each other Representation Date, and to the following further
conditions:
( i ) No Stop Order; Commission Filings. At the Closing Time and each subsequent Representation Date, the
Registation Statement shall remain effective and no stop order susperiding the effectiveness of the Registration Statement shall
have been issued under the 1933 Act or proceedings therefor initiated or threatened by the Commission and the Company
shall not have received from the Commission any notice pursuant to Rule a0l(g)(2) of the 1933 Act Regulations objecting to
use of the automatic shelf registration statement form, and any request on the part of the Commission for additional
information shall have been complied with to the reasonable satisfaction of counsel to the Sales Agent; the Prospectus shall
have been filed with the Commission in accordance with Rule 424(b); any material required to be filed by the Company
pursuant to Rule 433(d), shall have been filed with the Commission in accordance with the applicable time period prescribed
for such filing under Rule 433; and the Company shall have paid the required Commission filing fees relating to the Shares
within the time period required by Rule 456(b)0xi) of the 1933 Act Regulations without regard to the proviso therein and
otherwise in accordance with Rules 456(b) and 457(r) of the 1933 Act Regulations and, if applicable, shall have updated the
"Calculation of Registration Fee" table in accordance with Rule 456(bXlXiD of the 1933 Act Regulations either in a post-
effective amendment to the Regishation Statement or on the cover page of a prospectus filed pursuant to Rule 424b).
(ii) Opinions of Counselfor the Company. (A)Atthe Closing Time and within five Tiading Days after the date on
which the Company shall amend the Regishation Statement and/or amend or supplement the hospectus (in each case other
than by means of the incorporation by reference of documents filed with the Commission) or the date on which the Company
shall file an Annual Report on Form l0-K (each such date being herein called a "Primary Delivery Date"), the Sales Agent
shall have received the opinions, dated the date of delivery thereof, of Marian M. Durkin, Esq., SeniorVice President, General
Counsel and Chief
Compliance Officer of the Company, and Pillsbury Winthrop Shaw Pittman LLP, counsel for the Company, substantially in the
form of Exhibits B and C hereto, respectively.
(B) Wthin five Trading Days after the date on which the Company shall file a Quarterly Report on Form l0-Q or a
Current Report on Form 8-K (except to the extent that any such Current Report "furnishes" rather than "files" the information
provided therein), and at any other time reasonably requested by the Sales Agent (each of such dates being herein called a
"Secondary Delivery Date"), the Sales Agent shall have received the opinions, dated the date of delivery thereof, of counsel
referred to in clause (A) above, substantially in the form of Exhibis B and C hereto, respectively;provided, however, that such
counsel may deliver, in lieu of such opinions, a reliance letter to the effect that the Sales Agent may rely on the opinion
delivered on the next preceding Primary Delivery Date to the same extent as if it were dated the date of such letter (except that
the statements in such prior opinion shall be deemed to relate to the Registration Statement as amended and the Prospectus as
amended and/or supplemented as of such Secondary Delivery Date).
(iii) Opinion of Counsel for the Sales Agent. At the Closing Time and each other Primary Delivery Date, Secondary
Delivery Date relating to a Quarterly Report on Form l0-Q and, if and to the extent reasonably requested by the Sales Agent,
each other Secondary Delivery Date, the Sales Agent shall have received the opinion, dated the date of delivery thereof, of
Choate, Hall & Stewart LLB counsel for the Sales Agent, as to such matters as the Sales Agent shall reasonably request. In
giving such opinion such counsel may rely, as to all matters governed by the laws of jurisdictions other than the law of the
State of New York and the federal law of the United States upon the opinions of counsel to the Company. Such counsel may
also state that, insofar as such opinion involves factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and certificates of public oflicials.
(iv) No Material Adverse Change; Olficers'Certificate. (A) At the Closing Time and each other Representation Date,
there shall not have been since the date of the latest audited balance sheet included in the Registration Statement and the
Prospectus and except as disclosed therein, any Material Adverse Change and (B) at the Closing Time and at each other
Primary Delivery Date and each Secondary Delivery Date, the Sales Agent shall have received a certificate of the President or
a Mce President of the Company and of the chief financial or chief accounting officer of the Company, dated the date of
delivery thereof, to the effect that (I) there has been no such Material Adverse Change, (II) the representations and warranties
in Section 2(a) hereof are true and correct with the same force and effect as though expressly made at and as of such date, (ID
the Company has complied wittr all agreements and satisfied all conditions on its part required by this Agreement to be
performed or sausfied at or prior to such date, and (IV) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been instituted or are pending or, to the knowledge of the
signers, contemplated by the Commission.
(v) Accountant's Comfort Letter. Atthe Closing Time and within five Trading Days after each date on which the
Company shall file an Annual Report on Form l0-K, a Quarterly Report on Form l0-Q or a Current Report on Form 8-K that
contains financial statements of the Company (other than any Cunent Report on Form 8-K that is "furnished" to and not
"filed" with the Commission), the Sales Agent shall have received from Deloitte & Touche LLP a letter dated the date of
delivery thereof, in form and scope consistent with the internal guidelines of such firm for the delivery of comfort letters and,
in any event, in form and substance reasonably satisfactory to the Sales Agent, containing statements and informatton of the
type customarily included in accountants' "comfort letters" to underwriters with respect to the
financial statements of, and certain financial information relating to, the Company contained in the Registration Statement,
Disclosure Package and the Prospectus.
("i) Additional Conditions. At the Closing Time and on each other Represeniation Date, none of the events enumerated
in clauses (D, (ii), (iii) and (iv) ofSection l0(a) shall have occurred.
(vii) Additional Documents. At the Closing Time and on each other Primary Delivery Date and each Secondary
Delivery Date, the Sales Agent and counsel for the Sales Agent shall have been furnished with such additional documents and
opinions as they may reasonably require for the purpose of enabling such counsel to pass upon the issuance and sale of ttre
Shares as herein contemplated, or in order to evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings taken by the Company in connection with the
issuance and sale of the Shares as herein contemplated shall be reasonably satisfactory in form and substance to the Sales
Agent and counsel for the Sales Agent. For *re avoidance of doubt, it is understood and agreed that ttre Sales Agent shall not
have any obligation to offer or sell any Shares during the period commencing on any Primary Delivery Date or Secondary
Delivery Date, as the case may be, through the date on which all deliverables higgered by such Primary Delivery Date or
Secondary Delivery Date, as the case may be, have been satisfactorily delivered to the Sales Agent.
(viii) Additional Conditions for "Distributions ". If the Company shall direct the Sales Agent to offer and sell Shares in
a transaction that would constitute a "distribution" within the meaning of Rule 100 of Regulation M of the 1934 Act
Regulations, the Company will provide the Sales Agent (A) at the Sales Agent's request and upon reasonable advance notice
to the Company, on or prior to the Settlement Date in respect of such sale, the opinions of counsel and officers' certifltcates
pursuant to Sections 6(a)(ii), (iii) and (iv) hereof, each dated such Settlement Date, (B) at the Sales Agent's request and upon
reasonable advance notice to the Company, on or prior to the Settlement Date in respect of such sale, a customary
"bringdown" comfort letter from Deloitte & Touche LLP and (C) such other documents and information as the Sales Agent
shall reasonably request.
(b) Termination of Agreement.lf any condition specified in this Section shall nothave been fulfilled when and as required to
be fulfrlled and shall not be waived by the Sales Agent, this Agreement may be terminated by ttre Sales Agent by notice to lhe
Company, and such termination shall be without liability of any party to any other party, except as provided in Section 5 and except
that Sections 2,7,8 and 9 shall survive any such termination and remain in full force and effect.
( c ) Increase of Maximum Number. The Company may at any time increase the Maximum Number to any number by
delivering to the Sales Agent:
(D a notice executed by the President or a Senior Mce President of the Company stating that the Maximum Number
shall be increased to the number specified in such notice;
(ii) a certificate signed by the individuals specified in Section 6(aXiv) to the effect that the representations and
warranties in Section 2(a)(x) and 2(a)(xvii) are true and correct with respect to the Maximum Number as to be increased;
20
(iii) a certificate signed by the individuals and to the effect specified in Section 6(aXiv), with the proposed Maximum
Number being substituted for the existing Maximum Number;
(iv) opinions of counsel for the Company, as specified in Section 6(a)(ii), reflecting the Maximum Number as to be
increased;
(v) a revised Prospectus reflecting the Maximum Number as to be increased; aud
(vi) such additional documents as shall be reasonably required by the Sales Agent and counsel for the Sales Agent for
pulposes analogous to those specified in Section 6(a)(vi).
Upon the satisfaction of the foregoing conditions, the Maximum Number shall be increased as specified, without further act, for all
purposes of this Agreement.
SECTION 7. Indemnification.
( a ) Indemnification of the Sales Agent. The Company shall indemniff and hold harmless the Sales Agent, its affiliates,
directors and officers and each person, if any, who controls the Sales Agent, within the meaning of Section l5 of the 1933 Act or
Section 20 of the 1934 Act as follows:
(D against any and all loss, liability, claim, damage and expense whatsoever, as incurred, (A) arising out of any untrue
statement or alleged untrue statement of a material fact contained in the Regishatron Statement (or any amendment thereto), or
the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements
therein not misleading or (B) arising out of any untrue statement or alleged untrue statement of a material fact contained in any
Issuer Free Writing Prospectus, the Disclosure Package or the Prospectus (or any amendment or supplement thereto) or the
omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the
aggregate amountpaid in settlementof any litigation, orany investigation orproceeding by any governmental agency orbody,
commenced or threatened, or of any claim whatsoever based upon any untrue statement or omission of a material fact, or any
alleged untrue statement or omission of a material fact, in either case of the nature described in clause (i) above; provided that
any such settlement is effected with the written consent of the Company; and
(iiD against any and all expense whatsoever, as incurred (including the fees and disbursements ofcounsel chosen by
the Sales Agent), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or
proceeding by any govemmental agency or body, commenced or threatened, or any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid
under (i) or (ii) above;
provided, however, that this Section 7 shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with written information
furnished to the Company by the Sales Agent
expressly for use in the Registration Statement (or any amendment thereto), any Issuer Free Writing Prospectus, the Disclosure Package
or the hospectus (or any amendment or supplement thereto).
( b ) Indemnification of the Company. The Sales Agent shall indemnifr and hold harmless the Company, its directors and
officers, and each person, if any, who controls the Company within the meaning of Section l5 of the 1933 Act or Section 20 of the
1934 Act against any and all loss, liability, claim, damage and expense described in subsection (a) of this Section, as incurred, but only
with respect to unkue statements or omissions of a material fact, or alleged untrue statements or omissions of a material fact, made in
the Registration Statement (or any amendment thereto) or any Issuer Free Writing Prospectus, the Disclosure Package or the Prospectus
(or any amendment or supplement thereto) in reliance upon and in conformity with written information fumished to the Company by
the Sales Agent expressly for use therein.
(c) Actions against Parties; Notification. Each indemnified party shall give notice as promptly as reasonably practicable to
each indemni$ing party of any action commenced against it in respect of which indemnity may be sought hereunder, but failure to so
notiff an indemuiffing party shall not relieve such indemni$iog purty from any liability hereunder to the extent it is not materially
prejudiced as a result thereof and in any event shall not relieve it from any liability which it may have otherwise than on account of this
Section 7. In the case of parties indemnified pursuant to Section 7(a), counsel to the indemnified parties shall be selected by the Sales
Agent, and, in the case of parties indemnified pursuant to Section 7(b), counsel to the indemnified parties shall be selected by the
Company. An indemniffing party may participate at its own expense in the defense of any such aclion; provided, however, that counsel
to the indemniffing party shall not (except with the consent of the indemnified party) also be counsel to the indemnified party. In no
event shall the indemniffing parties be liable for fees and expenses of more than one counsel (in addition to any local counsel) separate
from their own counsel for all indemnified parties in connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances. No indemnifuing party shall, without the prior written
consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect to any litigation, or any
investigation or proceeding by any govemmental agency or body, commenced or threatened, or any claim whatsoever in respect of
which indemnification could be sought under this Section 7 or contribution could be sought under Section 8 hereof (whether or not the
indemnified parties are actual or potential parties thereto), unless such settlement, compromise or consent (i) includes an unconditional
release of each indemnified party from all liability arising out of such litigation, investigation, proceeding or claim and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to actby or on behalf of any indemnified party.
SECTIONS. Contribution.
If rhe indemnification provided for in Section 7 hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or expenses referred to therein, then each indemniffing party
shall contribute to the a9gre1ate amount of such losses, liabilities, claims, damages and expenses incurred by such indemnified parly,
(i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Sales Agent on
the other hand from the offering of the Shares pursuant to this Agreement or (ii) if the allocation provided by clause (i) is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the
relative faultof the Company on the one hand and of the SalesAgenton the otherhand in connection with the statements oromissions
which resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant equitable considerations.
The relative benefis received by the Company on the one hand and the Sales Agent on the other hand in connection wittr the
offering of the Shares pursuant to this Agreement shall be deemed to be in the same respective proportions as the total net proceeds
from the offering of the Shares pursuant to this Agreement (after the Sales Agent's commission or discount, but before expenses)
received by the Company and the total commissions and/or discounts received by the Sales Agent, bear to ttre aggregate public offering
price ofthe Shares.
The relative fault of the Company on the one hand and the Sales Agent on the other hand shall be determined by reference to,
among other things, whether any such untrue or alleged untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company or by the Sales Agent and the parties'relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Sales Agent agree that it would not be just and equitable if contribution pursuant to this Section 8 were
determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations
referred to above in this Section 8. The aggregate amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified parfy and referred to above in this Section 8 shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in investigating, preparing or defending against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement of a material fact or omission or alleged omission of a material fact.
Notwithstanding the provisions of this Section 8, the Sales Agent shall not be required to contribute any amount in excess of
the amount by which the total amount in respect of commissions or underwriting discounts received by the Sales Agent pursuant to this
Agreement exceeds the amount of any damages which the Sales Agent has otherwise been required to pay by reason of any such
unffue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of Section ll(f) of the 1933 Act) with respect to the
offering of Shares pursuant to this Agreement shall be entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.
For purposes of this Section 8, each affiliate, director and oflicer of the Sales Agent and each person, if any, who controls the
Sales Agent within the meaning of Section I 5 of the I 933 Act or Section 20 of the 1934 Act shall have the same rights to contribution
as the Sales Agent, and each director of the Company, each officer of the Company, and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to contribution as
the Company.
SECTION 9. Representations. Warranties and Agreements to Survive.
All of the respective representations, warranties and agreements of the Company and the Sales Agent contained in this
Agreement, or in certificates of offtcers of the Company delivered pursuant to this Agreement, shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of the Sales Agent or controlling person of the Sales Agent, or by or on
behalf of the Company, orany directot oflicerorcontrolling person of the Company, and shall survive delivery of and paymentforthe
Shares.
SECTION 10. Termination of Agreement.
(a) Termination by the Sales Agent.The Sales Agent may tenninate this Agreement, at any time
(i) if there has been since the date of the latest audited balance sheet included in the Registration Statement and the
Prospectus any Material Adverse Change, or
(ii) bankruptcy, insolvency, reorganization, or liquidation proceedings or other proceedings for relief under any other
law for the relief of debtors shall have been instituted by or against the Company or any Designated Subsidiary, or
(iii) the Company or any Designated Subsidiary shall have made an assignment for the benefit of creditors or shall
have applied to the appointnent of a receiver or trustee for such entity or for all or substantially all of its property or business, or
such a receiver or trustee shall otherwise have been appointed, or
(iv) the Common Stock shall no longer be listed on the NYSE, or
(v) if there has occurred any material adverse change in the financial markets in the United States or in the
intemational financial markets, any outbreak of hostilities or escalation thereof or other calamity or crisis or any change or
development involving a prospective change in national or international political, financial or economic conditions, in each case
ttre effect of which is such as to make it, in the judgment of the Sales Agent, impracticable or inadvisable to offer, sell or deliver
the Shares or to enforce contracts for the sale ofthe Shares, or
(vi) if trading in the Common Stock has been suspended or materially limited by the Commission or the New York
Stock Exchange, or if trading generally on the New York Stock Exchange or the NYSE MKT. or in the NASDAQ Global
Market or the NASDAQ Global Select Market has been suspended or materially limited, or minimum or maximum prices for
tading have been fixed, or maximum ranges for prices have been required, by either of such exchanges or Nasdaq Stock
Market, Inc. with respect to such markets or by order of the Commission or any other govemmental authority, or
(vii) a material disruption has occurred in commercial banking or securities settlement or clearance services in the
United States, or
(viii) if a banking moratorium has been declared by either federal or New York authorities.
The Sales Agent may terminate this Agreement for any other reason, upon ten days' advance notice to the Company.
(b) Termination by the Company. The Company may terminate this Agreement at any time, upon one Tiading Day's advance
notice to the Sales Agent.
(c) Liabilities.If thisAgreement is terminated pursuant to this Section, such termination shall be without liability of any party
to any other party except as provided in Section 5 hereof; and, prcvided, furthea that Sections 2, 7, 8 and 9 shall survive such
termination and remain in fulI force and effect.
SECTION I l. Notices.
(u) General. Except as hereinafter provided, all notices, requests and other communications hereunder shall be in writing and
shall be deemed to have been duly given if received by mail, electronic mail or transmitted by any standard form of telecommunication
to the addresses set forttr in this section or to such other address as such party shall have specified most recently by written notice.
Notices to the Sales Agent shall be directed to it at Credit Suisse Securities (USA) LLC, New York, New York 10010-3629, attention:
LCID-IBD, Fax No. [phone], with a copy (which shall not constitute notice) to: Choate, Hall & Stewart LLP, Two Intemational
Place, Boston, MA 02110, attention: Andrew J. Hickey, Esq., Fax No. [phone]; and notices to the Company shall be directed to
it at l4ll East Mission Avenue, Spokane, Washington 99202, attention: Treasurer, Fax No. [phone], e-mail:
Treasury@avistacorp. com.
( b ) Sales Notice; Confirmation and Settlement of Sales; Suspension of Sales. All Sales Notices shall be executed by an
individual named on Schedule A hereto who is the President, a Senior Vice hesident, a Vice President, the Treasurer or an Assistant
Treasurer of the Company, and shall be delivered to any of the personnel of the Sales Agent listed on Schedule A hereto. Any
comments by the Sales Agent on any Sales Notice shall be delivered to any of the personnel of the Company listed on Schedule A
hereto. All notices and other correspondence to and from the Company and ttre Sales Agent with respect to ttre confirmation and
settlement of sales of Shares or suspension of sales of Shares shall be delivered to the personnel of the Company and the SalesAgent
listed on Schedule A hereto. Either party may update its personnel listed on Schedule A by written notice to the other party.
SECTION 12. Parties in Interest.
This Agreement shall inure to the benefit of and be binding upon the Sales Agent and the Company and their respective
successors. Nothing expressed in this Agreement is intended or shall be construed to give any person, firm or corporation, other than
the Sales Agent and the Company and their respective successors and the controlling persons and officers and directors referred to in
Sections 7 and 8 and their heirs and legal representatives, any legal or equitable right, remedy or claim under or in respect of this
Agreement or any provision herein contained. This Agreement and all conditions and provisions hereof are intended to be for the sole
and exclusive benefit of the Sales Agent and the Company and their respective successors, and said controlling persons and officers
and directors and their heirs and legal representatives, and for the benefit of no other persor, firm or corporation. No purchaser of
Shares from the Sales Agent shall be deemed to be a successor by reason merely ofsuch purchase.
SECTION 13. No Advisory or Fiduciary Relationship.
The Company acknowledges and agrees that (a) the offering and sale of the Shares pursuant to this Agreement, including the
determination of the public offering price of the Shares and any related commissions and discounts, is an arm's-length commercial
transaction between the Company, on the one hand, and the Sales Agent, on the other hand, O) in connection with the offering
contemplated hereby and the process leading to such transaction, the Sales Agent is and has been acting solely on its own behalf and is
not the agent or fiduciary of the Company, or its shareholders, creditors, employees or any other pa4y, (c) the Sales Agent has not
assumed and will not assume an advisory or fiduciary responsibility in favor of the Company with respect to ttre offering contemplated
hereby or the process leading thereto (irrespective of whether the Sales Agent has advised or is currently advising the Company on
other matters) and the Sales Agent has no obligation to the Company with respect to the offering contemplated hereby except the
obligations expressly set forth in this Agreement, (d) the Sales Agent and its affiliates may be engaged in, and may in the future engage
in, a broad range of transactions that involve interests that differ from those of the Company and (e) the Sales Agent has not provided
any legal, accounting, regulatory or tax advice
25
with respect to the offering contemplated hereby, and the Company has consulted its own legal, accounting, regulatory and tax advisors
to the extent it deemed appropriate.
SECTION 14. Governing Law and Time.
This agreement and any claim, controversy or dispute relating to or arising out of this Agreement shall be governed by
and construed in accordance with the internal laws of the State of New York applicable to agreements made and to be performed
within the State of NewYork without giving effect to principles of conflicts of laws thereof . Specified times of day refer to New
York City time. Any action, suit or proceeding to enforce any provision of, or based on any matter arising out of or in connection with,
this Agreement or the transactions contemplated hereby shall be brought in any federal court located in the Southern District of the State
of New York or any New York state court located in the Borough of Manhattan, and the Company agrees to the exclusive jurisdiction
of such courts (and of the appropriate appellate courts therefrom), and each party waives (io the full extent permitted by law) any
objection it may have to the laying of venue of any such suit, action or proceeding in any such court or that any such suit, action or
proceeding has been brought in an inconvenient forum.
SECTION 15. Waiver of Jurv Trial.
The Company and the Sales Agent each hereby irrevocably waives any right it may have to a trial by ju.y in respect of any
claim based upon or arising out of this Agreement or any transaction contemplated hereby.
SECTION 16. Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all such counterparts
shall together constitute one and the same agreement.
SECTION 17. Entire Agreement.
This Agreement supersedes all prior and contemporaneous agreements and understandings (whether written or oral) between
the Company and the Sales Agent with respect to the subject matter of this Agreement.
SECTION 18. Effect of Headings.
The Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof.
SECTION 19. No Assignment.
No party may assign its rights or delegate its duties or obligations under this Agreement without the consent of the other party.
Any purported assignment or delegation of rights, duties or obligations hereunder shall be void and of no effect. Notwithstanding the
foregoing, the Sales Agent may assign its righs under this Agreement and/or may delegate some or all of its duties and obligations
under this Agreement, without the consent of the Company, to an affiliate of the Sales Agent that is a registered broker-dealer, it being
understood that no such assignment or delegation shall release the Sales Agent from any of its obligations hereunde r.
26
SECTION20. Severability.
This Agreement and each Terrns Agreement shall be deemed severable, and the invalidity or unenforceability of any term or
provision hereof or thereof shall not affect the validity or enforceabiliqr hereof or thereof or of any term or provision hereof or thereof.
Furthermore, if any term or provision of this Agreement or any Terms Agreement is determined to be invalid or unenforceable, there
shall be deemed to be made to such term or provision such minor changes (and only such minor changes) as shall be necessary to make
it valid and enforceable.
If the foregoing is in accordance with your understanding of our agreement, please sign and return to the Company a
counterpart hereof, whereupon this instrumen! along with all counterparts, will become a binding agreement between the Sales Agent
and the Company iu accordance with its temrs.
Very truly yours,
AVISTA CORPORATION
By: /s/ Mark T. Thies
Name: Mark T. Thies
Title: SeniorVice President,
Chief Financial Offi cer and
Treasurer
Sigaature Page to Sales Agency Agreement
CONFIRMED A}.iD ACCEPTED,
as ofthe date first above written
CREDIT SI,JISSE SECURTTES (USA) LLC
By: /s/ Craig Wiele
Name: Cnig lViele
Title: Managing Drector
Signature Page to Sales Agency Agreenenl
SCHEDTILE A
Contact Persons
The Comoanv
Mark T. Thies
Senior Vice President, Chief Financial Offtcer and Treasurer
[e-mail]
T:5094954639
Ryan L. Krasselt
Vice hesident, Controller and Principal Accounting Offrcer
[e-mail]
T:509495-2273
Don M. Falkner
Assistant Treasurer
Don. [e-mail]
T:509-495-4326
Richard N. Stevens
Assistant Treasurer and Director of Finance
Rich. Stevens@avistacorp. com
T:509-495-4330
Lauren Pendergraft
Senior Treasury Analyst
[e-mail]
T:509495-2998
Solely for notices and other correspondence to the Compeny with respect to the confirmation and settlement of sxles of
Shares, please include:
Denise Burns
Cash Management Analyst
[e-mail]
T:509-4954725
Treasury Deparhnent
ffeasury@avistacom. com
The Sales Agent
Craig Wiele
Managing Director
[e-mail]
T:212-325-8766
F:212-743-3764
Schedule A-l
SALES NOTICE
EXHIBIT A
IDate]
Credit Suisse Securities (USA) LLC
Attention: Craig Wiele
Tel. No. 212-325-8766
Fax No.: 212-743-3764
E-Mail: crais.wieleracredit-suisse. com
Reference is made to the Sales Agency Agreement between Avista Corporation (the "Company") and Credit Suisse Securities (USA) LLC, dated as
of March 2, 2016 (capitalized terms herein having the meanings assigned thereto in such Agreement). The Company confirms that all conditions to
the delivery of this Sales Notice are satisfied as of the date hereof. As of the date hereof, neither the Prospectus nor the Disclosure Package contains
an untrue statement of a material fact or omits to state a material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
First date of Selling Period:
Last date of Selling Period:
Number of days in Selling Period:
Settlement Date(s):
Number of Shares:
Floor Price*:
Company Bank Account
Third Trading Day after each sale
$
$per share
*The Floor Price shown above shall be applicable to any Shares to be sold during such Selling Period. Such Floor Price may be adjusted by the
Company during such Selling Period. Notrvithstanding the foregoing, in no event shall the Sales Price for any Shares be less than $_ below
the last sale price at which the Company's Common Stock was quoted on the record of composite transactions reported by The Wall Street
Journal on the Trading Day immediately preceding the day for fixing the price ofsuch Shares.
Additional Restrictions:
Comments:
AVISTA CORPORATION
By:
Name:
tTitle:
ITo be executed by the President, any Vice President, the Treasurer or any Assistant Treaswer ofthe Company.
Exhibit A-l
Exhibit 13
AVISTA CORPORATION
(a Washington corporation)
Common Stock
SALES AGENCY AGREEMENT
Dated: March 2,2016
Table of Contents
Certain Definitions
Representations and Warranties
(a) Representations and Watanties ofthe Company
(i)
(ii )
(iii)
(iv)
(v)
(vi)
Paqe
I
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5
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6
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SECTION I.
SECTION 2.
SECTION3.
SECTION4
Compliance with Securities Law Requirements
Incorporated Documents
Independent Accountants
Financial Statements
No Material Adverse Change
Good Standing ofthe Company and Designated Subsidiaries
(vii) No Significant Subsidiaries
(viii) Capitalization
(ix)
(x)
(xi)
Authorization of this Agreement
Authorization of the Shares
Description of the Common Stock
(xii) Registration; Listing
(xiii) Actively Traded Securities
(xiv) Absence ofDefaults
(xv) No Conflict
(xvi) Absence ofProceedings
(xvii) AbsenceofFurtherRequirements
(xviii) Title to Property
(xix) Leases
(xx) Investment Company Act
(xxi) Environmental Laws
(xxii) Intemal Controls
(xxiii) CompliancewithSarbanes-Oxley
(xxiv) Finder's Fees
(xxv) Sanctions
(xxvi) Compliance with Money Laundering Laws
(xxvii) No Unlawful Payments
(b) fficer's Certificates
Offen and Sales ofShares
(a) Initiation of Sales Efforts
(b) Manner of Offer and Sales
(c) Sales Price
(d) Confirmation of Sales
(e) Settlement of Sales
(f) Suspension of Sales
(E) Propietary Trading by the Sales Agent
(h) Limitations
Covenants
(a) Preparation and Filing of the Prospectus
(b) Review ofAmendments and Supplements
(c) Free Writing Prospectuses
(d)Notification of Commission Comments and Orders, Etc.
(e) Delivery of Registration Statements
(f) Delivery of Prospectuses
(g) Continued Compliance with Securities Laws
(h\ Blue Slcy Qualifications
(i) Rule 158
fi) Filing Fees
(k) Use of Proceeds
(l) Restriction on Sale of Shares
(m) Maximtm Number
(n) Regulation M
(o) Diligence Cooperation
Payment ofExpenses
(a) Expenses Payable by the Company
@) Expenses Payable by the Sales Agent
(c) Expenses Upon Termination
Conditions of the Sales Agent's Obligations; Termination ofAgrcemenl
(a\ Conditions
(i)
(ii)
(iii)
(iv)
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SECTION5.
SECTION6
SECTION 7.
SECTION 8.
SECTION9.
SECTION IO.
SECTION I I.
No Stop Order; Commission Filings
Opinions ofCounselfor the Company
Opinion ofCounselfor the Sales Agent
No Malerial Adverse Change ; Olficers' Certificate
(v) Accountant's Confoa lzuer
(vi) AdditionalConditions
(vii) Additional Documents
(viii) AdditionalConditionsfor"Distributions"
S) Termin at i o n of A g reemen t
(c) Increase of Maximum Number
Indemnification
(a) IndemniJication of the Sales Agent
(b'1 In d eru iJication of the Company
(c) Actions against Parties ; Notification
Contribution
Representations, Warranties and Agreements to Sunrive
Termination of Agreement
(a)Termination by the Sales Agent
(b) Termination by the Company
(c) Liabilities
Notices
SECTION 12.
SECTION 13.
SECTION 14.
SECTION 15.
SECTION 16.
SECTION 17.
SECTION I8.
SECTION 19.
SECTION20.
SCHEDIJLES
Schedule A
EX{IBITS
Exhibit A
(a) General
(b) Sales Notice; ConJinnation and Seltlement ofSales; Suspension ofsales
Parties in Interest
No Advisory or Fiduciary Relationship
Goveming Lawand Time
WaiverofJury Trial
Counterpafts
Entire Agreemcat
Effect ofHeadings
No Assignment
Severability
Contact Persons
Form ofSales Notice
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11
Sch A
A-1
lll
AVISTA CORPORATION
(a Washington corporation)
Common Stock
SALES AGENCY AGREEMENT
March 2,2016
J.P. MORGAN SECURITIES LLC
383 Madison Avenue
New York, New York 10179
Ladies and Gentlemen:
Avista Corporation, a Washington corporation (the " Company"), conlinns its agreement (the "Agreement") with J.P. Morgan
Securities LLC (the "Sales Agent"), whereby the Company, subject to the terms and conditions set forth herein, may from time to time
offer shares ("Shares") of its Common Stock, wittrout nominal or par value ("Common Stock"), and the Sales Agent, subject to such
terms and conditions, shall offer Shares for sale as the Company's sales agent or, in limited circumstances with the agreement of both
ttre Company and the Sales Agent, may purchase Shares as principal.
The Company may enter into one or more agreements substantially identical to this Agreement (each an "Other Agreement")
with other investrnent banking firms as sales agents (each an "Other Sales Agent") whereby, subject to the terms and conditions set
forth herein and therein, the Company may from time to time offer Shares and 0re Other Sales Agent party thereto, subject to such terms
and conditions, shall offer Shares for sale as the Company's sales agent ot in limited circumstances with the agreement of both the
Company and such Other Sales Agent, may purchase Shares as principal.
The maximum number of Shares that the Company may issue and sell under this Agreement and all the Other Agreements,
collectively, is the Maximum Number (as hereinafter defined).
On February 25,2016, the Company filed with the Securities and Exchange Commission (the "Commission") a registration
statement on Form S-3 (No. 333-209714), for ttre registration of securities, including the Shares, under the Securities Act of 1933, as
amended (ttre "f 933 Act"), and the offer and sale thereof from time to time in accordance with Rule 415 of the rules and regulations of
the Commission under the 1933 Act (the "1933 Act Regulations").
SECTION 1. Certain Definitions
When used in this Agreement, the following terms have ttre meanings specified below:
"Accounting Controls" has the meaning set forth in Section 2(a)(xxii)(I).
"Agreements and Instruments" has the meaning set forth in Section 2(a)(xiv).
"Applicable Time" means the time of each sale of Shares pursuant to this Agreement.
"Base Prospectus" means the base prospectus relating to the Shares filed as part of the Registration Statement, in the form in
which it has been most recently filed with the Commission prior to the Closing Time.
"Closing Time" means the time and date of the execution and delivery of this Agreement.
"Commercially Reasonable Efforts" means, with respect to the obligation of the Sales Agent to offer and sell Shares,
commercially reasonable efforts consistent with its normal trading and sales practices and in compliance with applicable law.
"Commission" has the meaning forth in the preamble to this Agreement.
"Commitment Period" means the period commencing on March 2, 2016 and expiring on the earliest to occur of (a) the first
date on which the Maximum Number of Shares shall have been sold under this Agreement and/or the Other Agreements, (b) the date
this Agreement is terminated pursuant to Section 6 or Section I 0 and (c) February 29, 2020.
"Common Stock" has the meaning set forth in the preamble to this Agreement.
"Company" has the meaning set forth in the preamble to this Agreement.
"Designated Subsidiary" means each of Avista Capital, Inc., Alaska Energy and Resources Company and Alaska Electric
Light and Power Company.
"Disclosure Controls" has the meaning set forth in Section 2(a)(xxii)(Ill).
"Disclosure Package" means, collectively, (i) the Prospectus as of any particular time and (ii) any other Issuer Free Writing
Prospectus relating to the offer and sale of the Shares (to the extent not superseded or modified by the hospectus or by a subsequent
Issuer Free Writing Prospectus).
*EDGAR" has the meaning set forth below in this Section l.
"Effective Time" means the date and time of the effectiveness of the Registration Statement for purposes of paragraph (f)(2)
of Rule 4308 of the 1933 Act Regulations ("Rule 4308"), as applied to the Sales Agent.
"Floor Price" means the minimum Sales Price set by the Company in a Sales Notice for any Selling Period, as such Sales
Notice may be amended from time to time during such Setling Period. The Floor Price may, in addition to setting an absolute minimum
dollar amount per Share, also be limited by reference to recent or prevailing market prices.
"Initiation Date" means each date of delivery of a Sales Notice pursuant to Section 3(a).
"Internal Controls" has the meaning set forth in Section 2(a)(xxiiXil).
"Issuer Free Writing Prospectus" means any "issuer free writing prospectus" (as defined by Rule 433 of the 1933 Act
Regulations ("Rule 433")) with respect to the Shares.
"Liens" has the meaning set forth in Section 2(a)(xviii).
"Material Adverse Change" has ttre meaning set forth in Section 2(a)(v).
"Material Adverse Effect" has the meaning set forth in Section 2(a)(vi).
"Maximum Number" means 3,795,199 or such higher number as shall be established pursuant to Section 6(c).
"Net Proceeds", with respect to any Shares sold hereundet means the aggregate Sales Prices for such Shares less the Selling
Commission in respect of the sale of such Shares (but before other expenses).
'NYSE" means the New York Stock Exchange.
"Other Agreement" has the meaning set forth in the preamble to this Agreement.
"Other Sales Agent" has the meaning set forth in the preamble to this Agreement.
"Primary Delivery Date" has the meaning set forth in Section 6(a)(ii).
"Prospectus" means, as of any particular time, the Base Prospectus, as supplemented by the final prospectus supplement
relating to the offer and sale of the Shares, as filed with the Commission pursuant to Rule 424@), together with any further supplements
or amendments thereto at such time.
"PUC Orders" has the meaning forth in Section 2(a)(xvii).
"Registration Statement" means, as of any particular time, the Company's regishation statement on Form S-3 (No. 333-
209714), including (a) any amendments thereto at such time, (b) the exhibits and schedules thereto at such time (other than the
Statement of Eligibility on Form T-1) and (c) any prospectus filed with the Commission pursuant to Rule 424(b) that, in accordance
with Rule 4308, is deemed to be a part thereof; provided, however, that, if a new registration statement shall have been filed and shall
have become effective on or aboutthe third anniversary of the initial effective date of registration statementNo.333-209714, the term
"Registration Statement" shall mean, at and after the time of the effectiveness of such new registration statement, such new registration
statement, including amendments, exhibits and any prospectus as aforesaid.
"Regulation S-T" means Regulation S-T of the Commission.
"Repayment Event" has the meaning set forth in Section 2(a)(xv).
"Representation Date" has the meaning set forth in Section 2(a).
"Rule 405" means Rule 405 of the 1933 Act Regulations.
"Rule 424(b)" means Rule 424(b) of the I 933 Act Regulations.
"Sales Agent" has the meaning set forth in the preamble to this Agreement.
"Sales Notice" means a written notice, substantially in the form of Exhibit A hereto, executed by an individual named in
Schedule A hereto who is the President, a Senior Vice President, a Vice hesident, the Theasurer or an Assistant Treasurer of the
Company and delivered to the Sales Agent in accordance with this Agreement. Any Sales Notice may be amended by the Company and
the Sales Agent and, from and after the time of such amendment, the term "Sales Notice" shall mean the original Sales Notice as
amended. Any Sales Notice or amendment to a Sales Notice shall be deemed acceptable to the Sales Agent unless the Sales Agent shall
promptly notiff the Company to the contrary. Each Sales Notice shall be delivered, and may be amended, by facsimile transmission, e-
mail or other customary means of elecfronic communication.
"Sales Price", with respect to any Shares sold hereunder, means the price per Share paid to the Sales Agent for such Shares.
"Secondary Delivery Date" has the meaning set forth in Section 6(a)(ii)(B).
"Selling Commission", with respect to any Shares sold hereundet means the commission, discount or other compensation to
be received by ttre Sales Agent in connection wittr the sale of such Shares.
"Selling Period" means a period of one to 20 consecutive Trading Days specified by the Company in a Sales Notice,
commencing no earlier than the Trading Day next succeeding the Trading Day on which such Sales Notice is delivered to the Sales
Agent.
"Settlement I)ate" means, with respect to the sale of any Shares, the third business day following the Trading Day on which
an offer to sell such Shares was accepted.
"Shares" has the meaning set forth in the preamble to this Agreement.
"Terms Agreement" means an agreement between the Company and the Sales Agent that relates to the issuance and sale by
the Company, and the purchase by the Sales Agent as principal (and not as agent), of a specific number of Shares and otherwise
incorporates the terms and provisions of, and is deemed a part of, this Agreement.
"Trading Day" means any day on which the NYSE is open for trading (ottrer than a day on which trading is scheduled to
close prior to its regular weekday closing time).
"1933 Act" has the meaning set forth in the preamble to this Agreement.
"1933 Act Regulations" has meaning set forth in the preamble to this Agreement.
"1934 Act" means the Securities Exchange Act of 1934, as amended.
"1934 Act Regulations" means the rules and regulations of the Commission under the 1934 Act.
The foregoing definitions are subject to the following qualifications:
(a) all references in this Agreement to the Registration Statement or the Prospectus or to any of the financial statements,
schedules or other information that is "contained", "included" or "stated" (or other words of like import) therein shall be deemed to
include the information contained in documents filed with the Commission under the 1934 Act that (i) are incorporated, or deemed
incorporated, therein by reference pursuant to Item l2 of Form S-3 under the 1933 Act, to the extent such information has not been
superseded or modified in accordance with Rule 412 of the 1933 Act Regulations (as qualified by Rule a30B(g) of the 1933 Act
Regulations) and (ii)(A) in the case of references to the "Registration Statement", are filed with the Commission at or prior to the
Eflective Time and (B) in the case of references to the "Prospectus", are filed with the Commission at or prior to the date thereof;
(b) all references in this Agreement to an amendment to the Registration Statement shall be deemed to include any document
filed under the 1934 Act subsequent to the date thereof that is deemed incorporated by reference therein pursuant to Item l2 of Form S-
3 under the 1933 Act;
(c) all references in this Agreement to an amendment or supplement to the Prospectus shall be deemed to include any
document filed under the 1934 Act subsequent to the date thereof that is deemed incorporated by reference therein pursuant to Item l2
ofForm S-3 underthe 1933 Act; and
(d) all references in this Agreement to the Registration Statement, any Issuer Free Writing Prospectus, the Prospectus or any
amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to its
Electronic Data Gathering, Analysis and Retrieval system ("EDGAR").
SECTION 2. Reoresentations and Warranties.
( a ) Reprcsentations and Watanties of the Company. The Company represents and warrants to the Sales Agent as of the
Closing Time, each Initiation Date, each Trading Day and each Applicable Time within each Selling Period, each Settlement Date, each
date as of which the Registration Statement shall be amended and each date as of which the Prospectus shall be amended or
supplemented (each such date a "Representation Date") as follows:
(i) Compliance with Securities Law Reouirements.
(A) Well-Known Seasoned Issuer Status. At the time the Registration Statement was filed with the Commission,
at all relevant determination dates, and at the date hereof, the Company was and is a "well-known seasoned issuer" (as
defined in Rule 405).
(B) Eligibiliiv to Use Form S-3. At the time the Registration Statement was filed with the Commission and at
the time of the most recent amendment, if any, to the Registration Statement for purposes of complying with Section
10(a)(3) of the 1933 Act, the Companymetthe requirements foruse of Form S-3 underthe 1933 Act.
( C ) Status and Content of the Regisration Statement. The Registration Statement became effective
automatically upon the filing thereof with the Commission under the 1933 Act. No stop order suspending the
effectiveness of the Registration Statement has been issued under the 1933 Act and no proceedings for that purpose
have been instituted by the Commission or are pending or, to the knowledge of the Company, have been threatened or
are contemplated by the Commission, and any request on the part of ttre Commission for additional information with
respect to the Registration Statement has been complied with. At the time the Registration Statement became effective,
and at the Effective Time, the Registration Statement complied in all material respects with the requirements of the 1933
Act and the 1933 Act Regulations. At the Effective Time, the Registration Statement did not contain an untrue statement
of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein
not misleading.
(D) Issuer Free Writing Prospectuses. At the earliest time after the filing of the Registration Statement that the
Company or another offering participant made a bona fide offer (within the meaning of Rule 164(hX2) of the 1933 Act
Regulations) of the Shares, the Company was not an "ineligible issuer" as defined in Rule 405. Each Issuer Free Writing
Prospectus, at the time it was filed with the Commission pursuant to Rule 433 or, if it was not required to be so filed, at
the time of each use thereof (i) did not include any information that conflicts with (A) information contained in the
Registration Statement, including any prospectus or prospectus supplement that is part of the Registration Statement, and
not superseded or modified, or (B) information contained in the Company's periodic and current reports filed with the
Commission pursuant to Section l3 or l5(d) of the 1934 Act that are incorporated or deemed incorporated by reference
in the Registration Statement, and not superseded or modified, and (ii)
complied in all other respects with the requirements of Rule 164 and Rule 433 (without reliance on subsections (b), (c)
and (d) of Rule 164 of the 1933 Act Regulations). No order preventing or suspending the use of any Issuer Free Writing
Prospectus has been issued by the Commission.
( E ) Content of the Disclosure Package. The Disclosure Package, at the Closing Time and at each Initiation
Date, each Applicable Time within each Selling Period and each Settlement Date, will not contain any untrue statement
of material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(F) Shnrs and Content of the Prospectus. The Prospectus, at the Closing Time, as of its date and at the time it is
filed with the Commission and at each Initiation Date, each Applicable Time within each Selling Period and each
Settlement Date, will conform in all material respects with the requirements of the 1933 Act and the 1933 Act
Regulations and, as of such respective dates, will not contain any unffue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of the circumstances under which they were
made, not misleading. The Prospectus delivered to the Sales Agent in connection with the offering of the Shares, and
any amendment or supplement thereto, will be identical to the copies thereof filed electronically with the Commission
pursuant to EDGAR (except that the registration fee table will be deleted from the cover thereof), except to the extent
permitted by Regulation S-T.
( G ) Description and Filing of Contracts and Documents. All contracts or documents that are required to be
described in the Registration Statement or the hospectus or to be filed as exhibits to the Registration Statement have
been so described and filed as required.
The representations and warranties in this subsection (a)(i) shall not apply to any statements in or omissions from the
Registration Statement, any Issuer Free Writing Prospectus, the Disclosure Package or the Prospectus made in reliance upon and
in conformity with information furnished to tlre Company in writing by the Sales Agent expressly for use therein.
(ii) Incorporated Documents. The documents incorporated or deemed incorporated by reference in the Registration
Statement and the Prospechrs, at the time they were or hereafter are filed with the Commission, complied or will comply, as
applicable, in all material respects with the requirements of the 1934 Act and the I 934 Act Regulations and, when filed did not
and will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not misleading.
(iii) lndependent Accountants. The accountants who audited the frnancial statements and financial statement schedules
included in the Registration Statement, the Disclosure Package and the Prospectus are independent registered public
accountants within the meaning of Regulation S-X of the Commission.
(iv) Financial Statements. The financial statements, together with the respective schedules and notes relating thereto,
included in the Registration Statement, the Disclosure Package and the Prospectus, present fairly the financial position of the
Company and its consolidated subsidiaries at the dates indicated and the results of operations and cash flows of the Company
and its consolidated subsidiaries for the periods specified; such financial statements
have been prepared in conformity with United States generally accepted accounting principles applied on a consistent basis
throughout the periods involved, except as otherwise stated therein. The selected financial data and the summary financial
information included in the Registration Statement, the Disclosure Package and the Prospectus present fairly the information
shown therein and have been compiled on a basis consistent with that of the audited financial statements included in the
Registration Statement. The financial statements and other financial data included in the Registration Statement and the
Prospectus comply in all material respects with the requirements of paragraph (e) of Item l0 of Regulation S-K. The interactive
data in eXtensible Business Reporting Language filed as exhibits to the documents incorporated by reference or deemed to be
incorporated by reference into the Registration Statement and the Prospectus fairly presents the information called for in all
material respects and has been prepared in accordance with the Commission's rules and guidelines applicable thereto. Except
as disclosed in the Registration Statement, the Disclosure Package and the Prospectus, neither the Company nor any of its
subsidiaries has any off-balance sheet arrangements of the character contemplated by Item 303 of Regulation S-K or otherwise
by Section l3G of ttre 1934 Act, or has any other contingent obligation or liability, which, in any case, is material, or is
reasonably likely to be material, to the Company and its consolidated subsidiaries considered as one enterprise.
( v ) No Material Adverse Change. Since the date of the latest audited balance sheet included in the Registration
Statement, the Disclosure Package and the Prospectus and except as disclosed therein, there has been no material adverse
change, or any development that could reasonably be expected to result in a material adverse change, in the condition
(financial or otherwise), business, properties or results of operations of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business (any such change or development, a "MaterialAdverse
Change").
(vi) Good Standing of the Company and Designated Subsidiaries. Each of the Company and each of the Designated
Subsidiaries has been duly incorporated and is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation and has the corporate power and authority to own or lease and operate its properties and to
conduct its business as described in the Registration Statement, the Disclosure Package and the Prospectus, and the Company
has the corporate power and authority to enter into and perform its obligations under this Agreement and the Other
Agreements; and the Company is duly qualified as a foreign corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whetherby reason of the ownership orleasing of property orthe conduct
of business, except where the failure so to qualiry or to be in good standing would not have a material adverse effect on the
condition (financial or otherwise), business, properties or results of operations of the Company and is subsidiaries considered
as one enterprise, whether or not arising in the ordinary course of business (any such effect, a "Material Adverse Effect").
(vii) No SignificantSubsidiaries. The Company has no "significantsubsidiaries" as defined in Rule l-02 of Regulation
s-x.
(viii) Capitalization. The authorized, issued and outstanding capital stock of the Company is as set forth in the
Registration Statement and the Prospectus. All of the issued and outstanding shares of Common Stock of the Company have
been duly authorized and validly issued and are fully paid and non-assessable. All of the issued and outstanding shares of
capital stock of each Designated Subsidiary have been duly authorized and validly issued, are fully paid and non-assessable
and are owned, directly or indirectly, by the Company, free and clear of any Liens.
( i x ) Authorization of this Agreement. This Agreement has been duly authorized, executed and delivered by the
Company.
( x ) Authorization of the Shares. The Shares have been duly authorized by the Company and, when issued and
delivered by the Company pursuant to this Agreement or any of the Other Agreements against payment of the consideration
contemplated herein or therein, will be validly issued, fully paid and non-assessable; no holder of the Shares will be subject to
personal liability in respect of liabilities of the Company solely by reason of being a holder of the Shares; and the issuance of
the Shares is not subject to the preemptive or other similar rights of any securityholder of the Company. Except as disclosed in
the Registration Statement and the Prospectus, there are no outstanding options, warrants, conversion rights, subscription
rights, rights of first refusal or other rights or agreements of any nature outstanding to subscribe for or to purchase any shares
of Common Stock of the Company binding on the Company (except pursuant to dividend reinvestment, stock purchase or
ownership, stock option or other director or employee benefit plans), and there are no outstanding securities or instruments of
the Company containing anti-dilution or similar provisions that will be triggered by the issuance of the Shares as described in
this Agreement or the Other Agreements. Except as disclosed in the Registration Statement and the Prospectus, there are no
restrictions upon the voting or transfer of any shares of the Company's Common Stock pursuant to the Company's Restated
Articles of Incorporation or By-laws. There are no agreements or other obligations (contingent or otherwise) that may require
the Company to repurchase or otherwise acquire any shares of its Common Stock. No person or entity has the right,
contractual or otherwise, to cause the Company to issue to it, or to register pursuant to the 1933 Act, any shares of Common
Stock upon the filing of the Registration Statement or the issuance or sale of the Shares hereunder. Immediately after any sale
of Shares by the Company under this Agreement and the Other Agreements, the aggregate number of Shares that have been
issued and sold by the Company hereunder and thereunder will not exceed the aggregate amount of Common Stock (A)
registered and available under the Registration Statement or (B) that shall be authorized by the PUC Orders from time to time.
( x i ) Description of the Common Stock. The description of the Common Stock in the Registration Statement, the
Disclosure Package and the Prospectus is accurate in all material respects.
(xii) Registration: Listing. The Common Stock is registered as a class under Section 12(b) of the 1934 Act. The
outstanding shares of Common Stock are listed, and the Shares are authorized for listing (subject to oflicial notice of issuance),
on the NYSE.
(xiii) Actively Tiaded Securities. The outstanding shares of Common Stock are "actively traded securities" excepted
from the provisions of Rule 101 of Regulation M of the 1934 Act Regulations by virtue of subsection (c)(1) of such rule.
(xiv) Absence of Defauls. Neither the Company nor any Designated Subsidiary is in violation of its articles of
incorporation or by-laws or in default in the performance or observance of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease or other agreement or
instrument to which the Company or such Designated Subsidiary is a party or by which it or such Designated Subsidiary may
be bound, or to which any of the property or assets of the Company or such Designated Subsidiary is subject (collectively,
"Agreements and Instruments") except for such defaults as, singly or in the a99regate, would not result in a Material Adverse
Effect.
(xv) No Conflict. The execution and delivery by the Company of this Agreement and the Ottrer Agreements and the
consummation by the Company of the fiansactions contemplated herein and therein (including the issuance and sale by the
Company of the Shares and the use of the proceeds from the sale of the Shares as described in the Registation Statement, the
Disclosure Package and the Prospectus) and compliance by the Company with its obligations hereunder and under the Other
Agreements, do not and will not, whether with or without the giving of notice or passage of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined below) under, or result in the creation or imposition of any
Lien upon any property or assets of the Company or any Designated Subsidiary pursuant to, the Agreements and Instruments
(except for such conflicts, breaches, defaults or Liens as, singly or in the aggregate, would not reasonably be expected to result
in a Material Adverse Effect), nor will such action result in any violation of the articles of incorporation or by-laws of the
Company or any Designated Subsidiary or of any statute of any jurisdiction applicable to the Company or any Designated
Subsidiary or any rule, regulation or order applicable to the Company or any Designated Subsidiary of any regulatory body,
administrative agency or other governmental body or any court that, in any such case, has jurisdiction over the Company or
any Designated Subsidiary or any of their respective assets, properties or operations. As used herein, a "Repayment Event"
means any event or condition that gives the holder of any note, debenture or other evidence of indebtedness (or any person
acting on such holder's behalf) the right to require the repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any Designated Subsidiary.
(xv i) Absence of Proceedings. There is no action, suit, proceeding, inquiry or investigation before or brought by any
court or governmental agency or body, domestic or foreign, now pending, or, to the knowledge of the Company, threatened,
against or affecting the Company or any of its subsidiaries, that (A) is required to be disclosed in the Registration Statement or
the Prospectus and is notdisclosed as required, (B) could materially and adversely affectthe consummation of the transactions
contemplated in this Agreement or any of the Other Agreements or the performance by the Company of its obligations
hereunder or thereunder or (C) except as disclosed in the Registration Statement, the Disclosure Package and the Prospectus,
would reasonably be expected to result in a Material Adverse Effect; and the aggregate of all pending legal or govemmental
proceedings to which the Company or any of its subsidiaries is a party or of which any of their respective properties or assets
is the subject that are not described in the Registration Statement, the Disclosure Package and the Prospectus, including
ordinary routine litigation incidental to the business, would not reasonably be expected to result in a Material Adverse Effect.
(xvii) Absence of Further Requirements. The Washington Utilities and Transportation Commission (the "WUTC"), the
Idaho Public Utilities Commission (the "IPUC") and the Public Utility Commission of Oregon (the "OPUC") have issued
orders auttrorizing the issuance and sale by the Company of the Shares on the terms contemplated in this Agreement and the
Other Agreements; the Montana Public Service Commission (the "MPSC") has issued an order disclaiming jurisdiction over
the issuance of securities and the creation of liens by the Company pursuant to, and on the terms set forth in such order (such
order, collectively with the aforesaid orders of the WUTC, the IPUC and the OPUC, being hereinafter called the "PUC
Orders"); the PUC Orders are in full force and effect as of the date hereof; and, except for informational filings required under
the PUC Orders, no further consent, approval or authorization of, or registration, filing or declaration with, any regulatory or
other governmental body or agency is required in connection with the execution, delivery or performance by the Company of
this Agreement or the Other Agreements or the issuance and sale by the Company of ttre Shares.
(xviii) Title to Propertv. The Company and each of its Designated Subsidiaries have good and marketable title to all
real property owned by them and good title to all other property owned by them, in each case subject only to such mortgages,
pledges, security interests, claims and other liens and encumbrances (collectively "Liens") and such exceptions, defects and
qualifications as (A) are described in the Regishation Statement and the Prospectus or (B) would not reasonably be expected to
result in a Material Adverse Effect.
(xix) Leases. A11 of the leases and subleases material to the business of the Company and its Designated Subsidiaries,
considered as one enterprise, and under which the Company or any of such subsidiaries holds properties, described in or
required to be described in ttre Registration Statement and the Prospectus are in full force and effect, and the Company has no
notice of any claim of any sort asserted by anyone adverse to the rights of the Company or any of such subsidiaries under any
of such leases or subleases, or affecting or questioning the rights of the Company or any of such subsidiaries to the continued
possession of the premises leased or subleased thereunder, that would reasonably be expected to result in a Material Adverse
Effect.
(xx) Investment Company Act. The Company is not, and upon the issuance and sale of the Shares as contemplated
herein and in the Other Agreements and the application of the net proceeds therefrom as described in the Regisftation
Statement, the Disclosure Package and the Prospectus will not be, an "inveshnent company" or an entity "controlled" by an
"investment company" as such terms are defined in the Investnent Company Act of 1940, as amended.
( x x i ) Environmental Laws. Except as described in the Registration Statement, the Disclosure Package and the
Prospectus, neither the Company nor any of the Designated Subsidiaries (A) is in violation of any statute, rule, regulation,
decision or order of any govemmental body or any court, domestic or foreign, relating to the use, disposal or release of
hazardous or toxic substances or other pollutants or contaminants, to the protection or restoration of the environment or to
human or animal exposure to hazardous or toxic substances or other pollutants or contaminants that have the potential to
adversely impact human or animal health (collectively, "environmental laws"), (B) owns or operates any real property
contaminated with any hazardous or toxic substances or other pollutants or contaminants that is subject to clean-up or other
responsive action under any environmental laws, (C) is liable for any off-site disposal or contamination pursuant to any
environmental laws, (D) is subject to any claim of violation of or liability under any environmental laws, which violation,
contamination, liability or claim would individually or in the aggregate reasonably be expected to have a Material Adverse
Effect; and ttre Company is not aware of any pending investigation or circumstances which would reasonably be expected to
lead to such a claim.
(xxii) Internal Controls. (A)The Company has devised and established and maintains the following, among other,
internal controls (without duplication):
(D a system of "intemal accounting controls" as contemplated in Section l3(bX2XB) of the 1934 Act
(the "Accounting Controls");
(ID "internal control over financial reporting" as such term is defined in Rule l3a-15(f) of the 1934 Act
Regulations; and
(I[) "disclosure controls and procedures" as such term is defined in Rule l3a-15(e) of the 1934 Act
Regulations (the "Disclosure Controls" and, together with the Accounting Controls and the Reporting Controls,
the "Internal Controls"));
(B) The Intemal Controls are evaluated by the Company's senior management periodically as appropriate and,
in any even! as required by law;
(C) Based on the most recent evaluations of the Internal Controls:
(I) the Intemal Controls are, individually and in the aggregate, effective in all material respects to
perform the functions for which they were established; and
0D all material weaknesses, if any, and significant deficiencies, if any, in the design or operation of the
Internal Controls which are reasonably likely to adversely affect the Company's ability to record, process,
summarize and report financial information and any fraud, whether or not material, that involves management or
other employees who have a significant role in the Internal Controls have been disclosed to the audit committee
of the Company's board of directors and the Company's independent auditors.
(xxiii) Comnliance with Sarbanes-Oxley. The Company is in compliance in all material respects with the Sarbanes-
Oxley Act of 2002 and the rules and regulations of the Commission that have been adopted thereunder, to the extent that such
act and such rules and regulations are in effect and applicable to the Company.
(xxiv) Finder's Fees. The Company has not incurred (directly or indirectly) nor will it incur, directly or indirectly, any
liability for any broker's, finder's, financial advisor's or other similar fee, charge or commission in connection with this
Agreement or the Other Agreements, or the transactions contemplated hereby or thereby, except as set forth in or
contemplated by this Agreement and the Other Agreements.
(xxv) Sanctions. Neither the Company nor any of its subsidiaries, nor, to the knowledge of the Company, any director,
officer or agent of the Company or any of its subsidiaries is currently the subject or the target of any sanctions administered by
the Office of Foreign Assets Control of the U.S. Departrnent of the Treasury or any other applicable sanctions laws or
regulations ("Sancfions"), nor is the Company or any of its subsidiaries located, organized or resident in a country or territory
that is the subject or the target of Sanctions, including, without limitation, Cuba, Iran, North Korea, Sudan and Syria (each, a
"Sanctioned Country"); and the Company will not directly or indirectly use the proceeds of the offering of the Shares
hereunder, or lend, contribute or otherwise make available such proceeds io any person or entity, (A) to fund or facilitate any
activities of or business with any person that, at the time of such funding or facilitation, is the subject or the target of Sanctions
or (B) to fund or facilitate any activities of or business in any Sanctioned Country or (C) in any other manner that will result in
a violation by any person (including any person participating in the transaction, whettrer as sales agent, advisor, investor or
otherwise) of Sanctions.
(xxvi) Compliance with Money Laundering Laws. The operations of the Company and is subsidiaries are and have
been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency
and Foreign Transactions Reporting Act of 1970, as amended, the applicable money laundering statutes of all jurisdictions in
which the Company and/or any of its subsidiaries conducts business, the rules and regulations thereunder and any related or
similar rules, regulations or guidelines issued, administered or enforced by any governmental or regulatory agency
(collectively, the "Anti-Money Laundering Laws"); and no action, suit or proceeding by or before any court or
govemmental or regulatory agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with
respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
(xxvii) No Unlawful Paymens. Neither the Company nor any of its subsidiaries, nor, to the knowledge of the
Company, any director, officer or agent of tle Company or any of its subsidiaries, has violated or is in violation of any
provision of the Foreign Comrpt Practices Act of 1977, as amended (the "FCPA") or any other applicable anti-corruption
and/or anti-bribery laws and regulations. The Company and the and its subsidiaries have instituted and maintain policies and
procedures designed to promote and provide reasonable assurance as to compliance with the FCPA.
(b) Olficer's Certificates. Any certificate signed by any officer of the Company delivered to the Sales Agent or to counsel for
the Sales Agent in connection with the offer and sale of the Shares shall be deemed a representation and warranty by the Company to
the Sales Agent as to the matters covered thereby.
SECTION 3. Offers and Sales of Shares.
(a) Initiation of Sales Efforts. Upon the terms and subjectto the conditions set forth herein, on any Trading Day during the
Commitment Period the Company may deliver to the Sales Agent a Sales Notice, and, upon the commencement of the Selling Period
specified in such Sales Notice, which shall not be earlier than the Tiading Day next succeeding the date of receipt by the Sales Agent of
such Sales Notice, the Sales Agent shall use its Commercially Reasonable Efforts to sell the number of Shares specified in such Sales
Notice. The Company acknowledges that there can be no assurance that the Sales Agent will be successful in selling the Shares and
agrees that the Sales Agent shall incur no liability or obligation to the Company if it does not sell Shares for any reason other than a
failure by the Sales Agent to use its Commercially Reasonable Efforts to sell such Shares in accordance with the terms of this
Agreement.
(b) Manner of Ofer and Sales. (i) The offering and sale of Shares under this Agreement (other than sales to or by the Sales
Agent as principal) shall be made by such methods permitted by law as the Sales Agent shall determine from time to time that are
deemed to be "at-the-market offerings" within the meaning of Rule als(a)(a) of the 1933 Act Regulations, including sales made
directly on the NYSE, through an "altemative trading system" as dehned in Rule 300 of Regulation ATS under the 1934 Act or any
other electronic communications network or to or through a market maker;provided, however, that, if the Company and the Sales
Agent so agree in writing, sales may be made in privately negotiated transactions;
(ii) If the Company and the Sales Agent so agree in a separate Terms Agreement (it being understood and agreed that neither
party is under any obligation to do so), the Company may sell Shares to the Sales Agent acting as principal, and the Sales Agent may
purchase such Shares acting as principal, it being understood that, in the event of any inconsistency between the terms and provisions
of this Agreement and those of the Terms Agreement, those of the Terms Agreement shall conrol.
(c) Sales Price.'(i) Sales of Shares by the Sales Agent acting as agent in At the Market Offerings or to or through a market
maker shall be made at prevailing market prices per Share or, if and to the extent so specified in the related Sales Notice, at prices per
Share related to prevailing market prices. Anything in this Agreement to the contrary nonvithstanding, (a) in no event shall the Sales
Price for any Shares so sold be less than the Floor Price set forth in the related Sales Notice and (b) the Company shall
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not establish any Floor Price that would not be within the limitations prescribed by the Board of Directors of the Company.
(iD Sales of Shares by the Sales Agent as agent in privately negotiated ffansactions, and the public offering of Shares
purchased by the Sales Agent acting as principal, shall be made at such Sales Prices as shall be agreed upon by the Company and the
Sales Agent in the particular case, such agreement by ttre Company to be within the limitations prescribed by the Board of Directors of
the Company.
(iiD The Selling Commission in respect of Shares sold hereunder in At the Market Offerings or to or through a market maker
shall be such percentage (not to exceed 2o/o) of the Sales Price thereof, as agreed upon by the Company and the Sales Agent from time
to time, provided, however, that the Selling Commission in respect of all sales hereunder that (A) are made under a Terms Agreement,
(B) made in a transaction that constitutes a "distribution" witlrin the meaning of Rule 100 of Regulation M of the 1934 Act Regulations
or (C) are otherwise not At the Market Offerings or to or through a market maker shall be agreed upon by the Company and the Sales
Agent in the particular case.
(d) Confirmation of Sales. The Sales Agent shall deliver to the Company, not later than the opening of the Trading Day next
following each Tiading Day on which it makes sales of Shares hereunder, a confirmation setting forth (i) the number of Shares sold in
each transaction on such Trading Day, (ii) the applicable Sales Price for each such sale ofShares, (iii) the aggregate Sales Price for each
such transaction and (iv) the Net Proceeds payable to the Company for each such transaction.
(e) Settlement of Sales. Subject to the conditions set forttr in Section 6, each sale of Shares hereunder shall be settled on the
Settlement Date therefor. No later than l2:00 Noon (New York City time) on the Settlement Date, the Company shall cause its transfer
agent, currently Computershare Shareholder Services LLC, to electronically transfer such Shares to the Sales Agent by crediting the
account of the Sales Agent or its designee or nominee at the Depository Ttust Company through is Deposit/Wthdrawal at Custodian
System, or by such other means of delivery as may be mutually agreed upon by the Company and the Sales Agent in writing. Upon
notification that ttre Shares have been issued, Sales Agent shall deliver the total Net Proceeds for the sale of all Shares to be settled on
such Settlement Date by wire tansfer of immediately available funds to an account designated by the Company in the related Sales
Notice.
( f ) Suspension of Sales. The Company or the Sales Agent may, upon notice to the other party in writing or by telephone
(confirmed immediately by verifiable facsimile transmission, e-mail or other customary means of electronic communication), suspend
the offering or sale of Shares, and the Selling Period shall immediately terminate;prcvided, however, that such suspension and
termination shall not affect or impair either party's obligations with rospect to any Shares sold hereunder prior to the prompt processing
of such notice of suspension.
(g) Proprietary Trading by the Sales Agent. T)re Sales Agent has advised the Company that during the Commitment Period the
Sales Agent and/or its affiliates may purchase and sell shares of Common Stock for their respective accounts and for the accounts of
their respective customers; provided, however, that (i) no such purchase or sale shall violate any provision of applicable law (including
particularly but without limitation the 1933 Act or the 1934 Act or any regulation under either thereof) and (ii) no sale of shares of
Common Stock shall be made by the Sales Agent for the account of the Sales Agent during any Selling Period unless (A) such sale is
made pursuant to and in accordance with the terms of a Terms Agreement, (B) such sale is a sale by the Sales Agent of shares
purchased, or deemed to have been purchased, from the Company as a "riskless principal" or in a similar capacity, (C) such sale is
made in trading transactions in the ordinary course of business but only if neither the Company nor the
Sales Agent is in violation of Regulation M of the I 934 Act Regulations or (D) the Company shall have consented thereto.
(h) Limitations. Anything in this Agreement to the contrary notwithstanding:
(i) in no event shall the aggregate number of Shares sold pursuant to this Agreement, together with the aggregate
number of Shares sold pursuant to the Other Agreements (as disclosed to the Sales Agent from time to time by the Company),
exceed the Maximum Number (the Company hereby acknowledging and agreeing that the Sales Agent shall have no
responsibility for maintaining records with respect to the aggregate number of Shares sold (other than the Shares sold under this
Agreement));
(ii) in no event shall the Sales Agent be obligated to make any offer or sale of Shares during any period in which either
party has reason to believe that the Common Stock is not an excepted security under Rule l0l(c)(l) of Regulation M of the
1934 Act Regulations; and
(iii) in no event shall the Company sell Shares through both the Sales Agent and any Other Sales Agent on the same
Trading Day; without limiting the generality of the foregoing, in no event shall the Selling Period designated in a Sales Notice
delivered to the Sales Agent include a Tiading Day that is included in a selling period that is in effect under one of the Other
Agreements; and each of the OtherAgreements shall contain the limitations sets forth in this clause (iii).
SECTION 4. Covenants.
(a) Preparation and Filing of the Prospectus. The Company will prepare the Prospectus and, after affording the SalesAgent
the opportunity to comment thereon, file the Prospectus with the Commission in accordance with Rule 424(b) not later than the
Commission's close of business on the second business day following the Closing Time.
( b ) Review of Amendments and Supplements. The Company will not amend the Regisffation Statement, or amend or
supplement the Prospectus, without providing notice to the Sales Agent at least 24 hours, or such shorter period as is reasonably
required by the circumstances, prior to the filing thereof with the Commission. Except in the case of any such amendment or
supplement to be made by the filing under the 1934 Act of a document that will be incorporated by reference in the Registration
Statement or the Prospectus that would be made by the Company irrespective of the offer and sale of the Shares, the Company will not
effect such amendment or supplement without the consent of the Sales Agent, such consent not to be unreasonably withheld or delayed.
Neither the consent of the Sales Agent, nor the delivery of any such amendment or supplement by the Sales Agent, shall constitute a
waiver of any of the conditions set forth in Section 6 hereof.
The Company will notiff the Sales Agent immediately, and confirm such notice in writing, when any post-effective
amendment to the Registration Statement shall have been filed or shall become eflective and when any supplement to the Prospectus or
any amended Prospectus shall have been filed.
(c) Free Writing Prospectuses. (i) The Company has not made and, without the consent of the Sales Agent, will not make any
offer relating to the Shares that would constitute a "free writing prospectus" as defined by Rule 405, including an Issuer Free Writing
Prospectus.
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(ii) The Sales Agent has not made, and without the consent of the Company shall not make, any offer relating to the Shares
that would constitute a "free writing prospectus" (as defined in Rule 405) that the Company would be required to file with the
Commission under Rule 433.
(d) NotiJication of Commission Comments and Orders, Etc. . The Company will notiS the Sales Agent of (i) the receipt of any
comments from the Commission with respect to the Registration Statement, any Issuer Free Writing Prospectus or the Prospectus,
including any request by the Commission for any amendment, supplement or additional information with respect thereto and (ii) the
issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of any order preventing or
suspending the use of any Issuer Free Writing Prospectus or ttre hospectus or the initiation or threatening of any proceeding for such
purpose. The Company will make every reasonable effortto preventthe issuance of any stop order and, in the event of any stop order,
to obtain the lifting thereof as soon as possible.
(e) Delivery of Registration Statements. The Company will deliver to the Sales Agent and to counsel for the Sales Agen! upon
request and wi&out charge, one conformed copy of the Registration Statement as originally filed and of each amendment thereto
(including, in each case, all exhibis filed therewith or incorporated by reference). Such copies of the Registration Statement and
amendments thereto so fumished to the Sales Agent will be identical to the copies thereof filed electronically with the Commission
pursuant to EDGAR (except that the registration fee table may be deleted from the cover thereof), except to the extent permitted by
Regulation S-T.
( f ) Delivery of Pruspectuses. The Company will furnish to the Sales Agent, without charge, during the period when the
Prospectus (or, in lieu thereof, the notice referred to in Rule I 73 (a) of the 1933 Act Regulations) is required to be delivered of the 193 3
ActRegulations, such numberof copies of the Prospectus as the SalesAgentmay reasonably request. Such copies of the Prospectus so
furnished to the Sales Agent will be identical to the copies thereof filed elecffonically with the Commission pursuant to EDGAR (except
that the registration fee table may be deleted from the cover thereo|, except to the extent permitted by Regulation S-T. The Company
will deliver to the Sales Agent, without charge, as many copies of any Issuer Free Writing Prospectus as the Sales Agent shall
reasonably request, and the Company hereby consents to the use ofsuch copies by the SalesAgent for purposes ofthe offer and sale of
the Shares in a manner consistentwith the 1933 Act and the 1933 Act Regulations.
(g) Continued Compliance with Securities Iaws. (i) The Company will file all reports and other documents that it is required to
file with the Commission pursuant to Sections l3(a), l3(c), 14 or l5(d) of the 1934 Act within the time periods required by the 1934
Act and the 1934 Act Regulations and will otherwise comply with the I 933 Acq the I 933 Act Regulations, the I 934 Act and the I 934
Act Regulations so as to permit the offer, sale and distribution of the Shares as contemplated in this Agreement and the Prospectus;
provided, however, that the Company may assume that the distribution of the Shares issued on any Settlement Date has been completed
on the business day following such Settlement Date unless the Sales Agent shall have provided written notice to the confary.
(ii) During the distribution of the Shares, the Company will notifu the Sales Agent promptly if (A) any filing is made by the
Company of information relating to the offering of the Shares with any securities exchange or any other regulatory body in the United
States or any other jurisdiction or (B) a Material Adverse Change shall have occurred that is not disclosed in the Registration Statement
and the Prospectus or (C) any other event shall have occurred that causes (x) the Registration Statement to contain any untrue statement
of material fact or omit to state any material fact necessary in order to make the statements therein not misleading or (y) the Disclosure
Package or the Prospectus to contain any untrue statement of material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were made, not misleading.
(iiD Upon any notification pursuant to clause (ii)(B) or (C) above, or if at any time an event shall occur or other circumstances
shall exist as a result of which it is necessary, in the reasonable judgment of the Company or of the Sales Agent, (A) to amend the
Registation Statement in order that it shall not, as of the Effective Time, include any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein not misleading or otherwise to comply with the requirements of the
1933 Act or the 1933 Act Regulations or (B) to amend or supplement the Prospectus in order that it shall not, as of any Initiation Date,
any Applicable Time within any Selling Period or any Settlement Date, contain any untrue statement of material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of the circumstances existing at such time, not misleading or
o*rerwise to comply with the requirements of the 1933 Act or the 1933 Act Regulations,
(A) the Company will promptly prepare and file with the Commission, subject to Section 4ft), such amendment or
supplement as may be necessary to correct such statement or omission or to make the Registration Statement or the Prospectus
comply with such requirements, and the Company will fumish to the Sales Agent such number of copies of such amendment or
supplement as the Sales Agent may reasonably request;
(B) the Company shall not deliver to the Sales Agent any Sales Notice until such statement or omission is corrected;
and
(C) if such time shall be during a Selling Period specified in a Sales Notice theretofore delivered to the Sales Agent, the
Company shall promptly, by telephone (confirmed by elechonic mail), cancel such Sales Notice and direct the Sales Agent to
cease selling Shares and making offers for such sales.
(h) Blue Sky Qualifications. The Company will use its best efforts, in cooperation with the Sales Agent, to take such action, if
any, as may be required to qualiff the Shares for offering and sale under the applicable securities laws of such states and other
jurisdictions as the Sales Agent may reasonably designate and to maintain such qualifications in effect as long as required for the
dishibution of the Shares; provided, however, that the Company shall not be obligated to file any general consent to service of process
or to qualiff as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to
taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject. In the event that the Company becomes
aware of the suspension of the qualification of the Shares for offering or sale in any jurisdiction, or of the initiation or threatening of any
proceedings for any of such purposes, the Company will so notiff the Sales Agent and will cooperate with the Sales Agent to endeavor
to preventany such suspension and, in the eventofany such suspension, to obtain the lifting thereofas soon as possible.
(i) Rule I 5 8 . The Company will timely file such reports pursuant to the I 934 Act as are necessary in order to make generally
available to its securityholders as soon as practicable an eamings statement for the purposes of, and to provide the benefits
contemplated by, the last paragraph of Section I I (a) of the 1933 Act and Rule 158 ttrereunder (which earnings statement need not be
audited unless required so to be under Section l1(a) of the 1933 Act).
(t) Filing Fees. The Company agrees to pay the required Commission filing fees relating to the Shares within the time required
by Rule 456(b)( 1) of the I 933 Act Regulations and otherwise in accordance with Rules 456(b) and 457(r) of the 1933 Act Regulations.
( k ) Use of Proceeds. The Company will use the Net Proceeds received by it from the sale of the Shares in the manner
specified in the Prospectus under "Use ofProceeds".
( I ) Restriction on Sale of Shares. The Company will not (A) at any time during any Selling Period without the prior written
consent of the Sales Agent or (B) at any time during the term of this Agreement wittrout giving the Sales Agent at least three Trading
Days'prior written notice specifring the nature and timing of the proposed sale, directly or indirectly, offer to sell, contract to sell, sell,
grant any option to buy or otherwise dispose of any shares of Common Stock or securities convertible into or exchangeable for shares
of Common Stock or warrants or rights to purchase or acquire shares of Common Stock. The foregoing restrictions shall not restrict the
Company's issuance or sale of (i) shares of Common Stock pursuant to this Agreement or the Other Sales Agreements, (ii) shares of
Common Stock, options to purchase shares of Common Stock or shares of Common Stock issuable upon the exercise of options, in any
case pursuant to any employee or director stock option or benefit plan, stock purchase or ownership plan or dividend reinvestment plan
of the Company, (iii) shares of Common Stock issuable upon the conversion of securities orthe exercise of warrants, options orother
rights disclosed in the Registration Statement and the Prospectus or (iv) shares of Common Stock issuable as consideration in
connection with acquisitions of business, assets or securities of other entities by merger or otherwise.
( m ) Maximum Number. The Company will promptly noti$ the Sales Agent and each of the Other Sales Agents when the
Maximum Number of Shares has been sold.
(n) Regulation M.lf either the Company or the Sales Agent shall have reason to believe that the Common Stock is not an
excepted security under Rule 101(c)(1) of Regulation M of the 1934 Act Regulations, it shall promptly notiff the other party and the
Sales Agent may suspend sales of Shares under this Agreement or any Terms Agreement until, in the judgment of each party, the
Common Stock is such an excepted security.
(o) Diligence Cooperation. The Company shall reasonably cooperate with any reasonable due diligence review requested by
the Sales Agent or its counsel from time to time in connection with the transactions contemplated hereby or any Terms Agreemen!
including, without limitation, on or about each Primary Delivery Date and each Secondary Delivery Date, providing information and
making available appropriate documents and appropriate corporate officers of the Company and, upon reasonable request,
representatives of Deloitte & Touche LLP.
SECTION 5. Payment ofExpenses.
(a) Expenses Payable by the Company.The Company will pay all expenses incident to the performance of its obligations
underthisAgreemen! including (i) the preparation, printing and filing of the Registration Statement(including financial statements and
exhibits) as originally filed and of each amendment thereto, (ii) the preparation, printing and delivery to the Sales Agent of this
Agreement and such other documents as may be required in connection with the offering, purchase, sale, issuance or delivery of the
Shares, (iii) the preparation, issuance and delivery of the certificate or certificates for the Shares, (iv) the fees and disbursements of the
Company's counsel, accountants and other advisors, (v) the qualification of the Shares under securities laws in accordance with the
provisions of Section 4(h) hereof, (vi) the printing and delivery to the Sales Agent of copies of each Issuer Free Writing Prospectus and
of the Prospectus and any amendments or supplements thereto, (vii) the preparation, printing and delivery to the Sales Agent of copies
of any Blue Sky survey and any supplement thereto, (viii) the costs and expenses of the Company relating to investor presentations on
any "road show" undertaken in connection with the marketing of the Shares, including without limitation, expenses associated with the
production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the road show
presentations, travel and lodging expenses ofthe Sales Agent and officers ofthe Company and any such consultants, and the cost of
aircraft and other ffansportation chartered in connection with the road show and (ix) the reasonable documented out-of-pocket expenses
of the Sales Agent, including the reasonable fees and disbursements of counsel for the Sales Agent in connection with the negotiation,
t7
execution and delivery of this Agreement and the performance of its obligations hereunder during the Commitment Period, it being
understood that the Company shall be required to pay the fees and disbursements of only one counsel for the Sales Agent and the Other
Sales Agents.
( b ) Expenses Payable by the Sales Agent. Except as provided in subsection (a) above and subsection (c) below, the Sales
Agent will pay all of its expenses incurred in connection with the transactions contemplated hereby, including the fees and
disbursements of any counsel for the Sales Agent (other than the one counsel for the Sales Agent and Other Sales Agents contemplated
in subsection (a)(ix) above).
( c ) Expenses Upon Tbrmination. lf this Agreement is terminated by the Sales Agent in accordance with &e provisions of
Section 6 or Section l0(a)(i) hereof, the Company shall reimburse the Sales Agent for all of its out-of-pocket expenses incurred in
connection with the transactions contemplated hereby, including the reasonable fees and disbursements of the one counsel for the Sales
Agent and the Other Sales Agents contemplated in subsection a(ix) above.
SECTION 6. Conditions of the Sales Agent's Obligations: Termination of Agreement.
(a) Conditions. The obligations of the Sales Agent hereunder are subject to the accuracy, as of the Closing Time and each
other Representation Date, of the representations and warranties of the Company contained in Section 2(a) hereof and in all certificates
of officers of the Company delivered pursuantto the provisions hereof, to the performance by the Company of its covenants and other
obligations hereunder to be performed at or prior to ttre Closing Time and each other Representation Date, and to the following further
conditions:
( i ) No Stop Order; Commission Filings. At the Closing Time and each subsequent Representation Date, the
Registration Statement shall remain effective and no stop order suspending the effectiveness of the Registration Statement shall
have been issued under the 1933 Act or proceedings therefor initiated or threatened by the Commission and the Company
shall not have received from the Commission any notice pursuant to Rule a0l (g)(2) of the I 93 3 Act Regulations objecting to
use of the automatic shelf registration statement form, and any request on the part of the Commission for additional
information shall have been complied with to the reasonable satisfaction of counsel to the Sales Agent; the Prospectus shall
have been filed with the Commission in accordance with Rule 424(b); any material required to be filed by the Company
pursuant to Rule 433(d), shall have been filed with the Commission in accordance with the applicable time period prescribed
for such filing under Rule 433; and the Company shall have paid the required Commission filing fees relating to the Shares
within the time period required by Rule 456OXIXD of the 1933 Act Regulations without regard to the proviso therein and
otherwise in accordance with Rules 456(b) and 457(r) of the 1933 Act Regulations and, if applicable, shall have updated the
"Calculation of Registration Fee" table in accordance with Rule 456(b)(lXiD of the 1933 Act Regulations either in a post-
effective amendment to the Registration Statement or on the cover page of a prospectus filed pursuant to Rule 424(b).
( i i ) Opinions oJ Counsel for the Company. (A) At the Closing Time and within five Trading Days after the date on
which the Company shall amend the Registration Statement and/or amend or supplement the Prospectus (in each case other
than by means of the incorporation by reference of documents filed with the Commission) or the date on which the Company
shall file an Annual Report on Form l0-K (each such date being herein called a "Primary Delivery Date"), the Sales Agent
shall have received the opinions, dated the date of delivery thereof, of Marian M. Durkin, Esq., SeniorVice President, General
Counsel and Chief
Compliance Officer of the Company, and Pillsbury Winthrop Shaw Pittman LLP, counsel for the Company, substantially in the
form of Exhibits B and C hereto, respectively.
(B) Within five Tiading Days after the date on which the Company shall file a Quarterly Report on Form I0-Q or a
Current Report on Form 8-K (except to the extent that any such Current Report "furnishes" rather than "files" the information
provided therein), and at any other time reasonably requested by the Sales Agent (each of such dates being herein called a
"Secondary Delivery Date"), the Sales Agent shall have received the opinions, dated the date of delivery thereoi of counsel
referred to in clause (A) above, substantially in the form of Exhibis B and C hereto, respectively;provided, however, that such
counsel may deliver, in lieu of such opinions, a reliance letter to the effect that the Sales Agent may rely on the opinion
delivered on the next preceding Primary Delivery Date to the same extent as if it were dated the date of such letter (except that
the statements in such prior opinion shall be deemed to relate to the Registration Statement as amended and the Prospectus as
amended and/or supplemented as of such Secondary Delivery Date).
(iii) Opinion of Counselfor the Sales Agent. At the Closing Time and each otherPrimary Delivery Date, Secondary
Delivery Date relating to a Quarterly Report on Form l0-Q and, if and to the extent reasonably requested by the Sales Agent,
each other Secondary Delivery Date, ttre Sales Agent shall have received the opinion, dated the date of delivery thereof, of
Choate, Hall & Stewart LLB counsel for the Sales Agent, as to such matters as the Sales Agent shall reasonably request. In
giving such opinion such counsel may rely, as to all matters governed by the laws of jurisdictions other than the law of the
State of New York and the federal law of the United States upon the opinions of counsel to the Company. Such counsel may
also state tha! insofar as such opinion involves factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and certificates of public officials.
(iv) No Material Adverse Change; Olficers'Certificate . (A) At the Closing Time and each o*ler Representation Date,
there shall not have been since the date of the latest audited balance sheet included in the Registration Statement and the
Prospectus and except as disclosed therein, any Material Adverse Change and (B) at the Closing Time and at each other
Primary Delivery Date and each Secondary Delivery Date, the Sales Agent shall have received a certificate of the President or
a Vice President of the Company and of the chief financial or chief accounting officer of the Company, dated the date of
delivery thereof, to the effect that (I) there has been no such Material Adverse Change, (II) the representations and warranties
in Section 2(a) hereof are true and correctwith the same force and effectas though expressly made at and as of such date, (III)
the Company has complied with all agreements and satisfied all conditions on its part required by this Agreement to be
performed or satisfied at or prior to such date, and (IV) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been instituted or are pending or, to the knowledge of the
signers, contemplated by the Commission.
( v ) Accountant's Comfort Letter. At the Closing Time and within five Tiading Days after each date on which the
Company shall file an Annual Report on Form l0-K, a Quarterly Report on Form l0-Q or a Current Report on Form 8-K that
contains financial statements of the Company (other than any Current Report on Form 8-K that is "furnished" to and not
"filed" with the Commission), the Sales Agent shall have received from Deloitte & Touche LLP a letter dated the date of
delivery thereof, in form and scope consistent with the intemal guidelines of such firm for the delivery of comfort letters and,
in any event, in form and substance reasonably satisfactory to the SalesAgent, containing statements and information of the
type customarily included in accountants' "comfort letters" to underwriters with respect to the
financial statements of, and certain financial information relating to, the Company contained in the Registration Statement,
Disclosure Package and the Prospectus.
(vi) Additional Conditions. At the Closing Time and on each other Representation Date, none of the events enumerated
in clauses (i), (ii), (iii) and (iv) ofSection l0(a) shall have occurred.
(vii) Additional Documents. At the Closing Time and on each other Primary Delivery Date and each Secondary
Delivery Date, the Sales Agent and counsel for the Sales Agent shall have been fumished with such additional documents and
opinions as they may reasonably require for the purpose of enabling such counsel to pass upon the issuance and sale of the
Shares as herein contemplated, or in order to evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings taken by the Company in connection with the
issuance and sale of the Shares as herein contemplated shall be reasonably satisfactory in form and substance to the Sales
Agent and counsel for the Sales Agent. For the avoidance ofdoubt, it is understood and agreed that the Sales Agent shall not
have any obligation to offer or sell any Shares during the period commencing on any himary Delivery Date or Secondary
Delivery Date, as the case may be, through the date on which all deliverables triggered by such Primary Delivery Date or
Secondary Delivery Date, as the case may be, have been satisfactorily delivered to the Sales Agent.
(viii) Additional Conditions for "Distributions ". If the Company shall direct the Sales Agent to offer and sell Shares in
a transaction that would constihrte a "distribution" within the meaning of Rule 100 of Regulation M of the 1934 Act
Regulations, the Company will provide the Sales Agent: (A) at the Sales Agent's request and upon reasonable advance notice
to the Company, on or prior to the Settlement Date in respect of such sale, the opinions of counsel and officers' certificates
pursuant to Sections 6(a)(ii), (iii) and (iv) hereof, each dated such Settlement Date, (B) at the Sales Agent's request and upon
reasonable advance notice to the Company, on or prior to the Settlement Date in respect of such sale, a customary
"bringdown" comfort letter from Deloitte & Touche LLP and (C) such other documents and information as the Sales Agent
shall reasonably request.
(b) Termination of Agreement.If any condition specified in this Section shall not have been fulfilled when and as required to
be fulfrlled and shall not be waived by the Sales Agent, this Agreement may be terminated by the Sales Agent by notice to the
Company, and such termination shall be without liability of any party to any other party, except as provided in Se ction 5 and except
that Sections 2, 7 , 8 and,9 shall survive any such termination and remain in full force and effect.
( c ) Increase of Maximum Number. The Company may at any time increase the Maximum Number to any number by
delivering to the Sales Agent:
(D a notice executed by the President or a Senior Vice President of the Company stating that the Maximum Number
shall be increased to the number specified in such notice;
(ii) a certificate signed by the individuals specified in Section 6(a)(iv) to the effect that the representations and
warranties in Section 2(a)(x) and 2(a)(xvii) are true and correct with respect to the Maximum Number as to be increased;
(iii) a certificate signed by ttre individuals and to the effect specified in Section 6(a)(iv), with the proposed Maximum
Number being substituted for the existing Maximum Number;
(iv) opinions of counsel for the Company, as specified in Section 6(a)(ii), reflecting the Maximum Number as to be
increased;
(v) a revised Prospectus reflecting the Maximum Number as to be increased; and
(vi) such additional documents as shall be reasonably required by the Sales Agent and counsel for the Sales Agent for
purposes analogous to those specified in Section 6(a)(vi).
Upon the satisfaction of the foregoing conditions, the Maximum Number shall be increased as specified, without further act, for all
purposes of this Agreement.
SECTION 7. Indemnification.
( a ) Indemnification of the Sales Agent. The Company shall indemni$ and hold harmless the Sales Agent, its affiliates,
directors and officers and each person, if any, who controls the Sales Agent, within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act as follows:
(D against any and all loss, liability, claim, damage and expense whatsoever, as incurred, (A) arising out of any untrue
statement or alleged untrue statement of a material fact contained in the Regishation Statement (or any amendment thereto), or
the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements
therein not misleading or (B) arising out of any untrue statement or alleged untrue statement of a material fact contained in any
Issuer Free Writing Prospectus, the Disclosure Package or the Prospectus (or any amendment or supplement thereto) or the
omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any govemmental agency or body,
commenced or threatened, or of any claim whatsoever based upon any untrue statement or omission of a material fact, or any
alleged untrue statement or omission of a material fact, in either case of the nature described in clause (i) above; provided that
any such settlement is effected with the written consent of the Company; and
(iiD against any and all expense whatsoever, as incurred (including the fees and disbursements of counsel chosen by
the Sales Agent), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or
proceeding by any govemmental agency or body, commenced or threatened, or any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid
under (i) or (ii) above;
provided, however, that this Section 7 shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with written information
furnished to the Company by the Sales Agent
2l
expressly for use in the Registration Statement (or any amendment thereto), any Issuer Free Writing Prospectus, the Disclosure Package
or the Prospectus (or any amendment or supplement thereto).
( b ) IndemniJication of the Company. The Sales Agent shall indemniff and hold harmless the Company, its directors and
officers, and each person, if any, who confols the Company within the meaning of Sectron l5 of the 1933 Act or Section 20 of the
1934 Act against any and all loss, liability, claim, damage and expense described in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or omissions of a material fact or alleged untrue statements or omissions of a material fact, made in
the Registration Statement (or any amendment thereto) or any Issuer Free Writing Prospectus, the Disclosure Package or the hospectus
(or any amendment or supplement thereto) in reliance upon and in conformity with written information furnished to the Company by
the Sales Agent expressly for use therein.
(c) Actions against Parties; Notification. Each indemnified party shall give notice as promptly as reasonably practicable to
each indemnifuing party of any action commenced against it in respect of which indemnity may be sought hereunder, but failure to so
notiff an indemniffing party shall not relieve such indemniffing party from any liability hereunder to the extent it is not materially
prejudiced as a result thereof and in any event shall not relieve it from any liability which it may have otherwise than on account of this
Section 7. In *re case of parties indemnified pursuant to Section 7(a), counsel to the indemnified parties shall be selected by the Sales
Agent, and, in the case of parties indemnified pursuant to Section 7(b), counsel to the indemnified parties shall be selected by the
Company. An indemniffing party may participate at its own expense in the defense of any such acion; provided, however, that counsel
to the indemnifuing party shall not (except with the consent of the indemnified party) also be counsel to the indemnified party. In no
event shall the indemniffing parties be liable for fees and expenses of more than one counsel (in addition to any local counsel) separate
from their own counsel for all indemnified parties in connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances. No indemni$ing party shall, without the prior written
consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect to any litigation, or any
investigation or proceeding by any govemmental agency or body, commenced or threatened, or any claim whatsoever in respect of
which indemnification could be sought under this Section 7 or contribution could be sought under Section 8 hereof (whether or not the
indemnified parties are actual or potential parties thereto), unless such settlement, compromise or consent (i) includes an unconditional
release of each indemnified party from all liability arising out of such litigation, investigation, proceeding or claim and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.
SECTION 8. Contribution.
If the indemnification provided for in Section 7 hereof is for any reason unavailable to or insuflicient to hold harmless an
indemnified party in respect of any losses, Iiabilities, claims, damages or expenses referred to therein, then each indemniffing party
shall conkibute to the a9gregalrc amount of such losses, liabilities, claims, damages and expenses incurred by such indemnified party,
(i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Sales Agent on
ttre other hand from the offering of the Shares pursuant to this Agreement or (ii) if the allocation provided by clause (i) is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the
relative faultof the Company on the one hand and of the SalesAgenton the otherhand in connection with the statements oromissions
which resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant equitable considerations.
22
The relative benefits received by the Company on the one hand and the Sales Agent on the other hand in connection with the
offering of the Shares pursuant to this Agreement shall be deemed to be in the same respective proportions as the total net proceeds
from the offering of the Shares pursuant to this Agreement (after the Sales Agent's commission or discount, but before expenses)
received by the Company and the total commissions and/or discounts received by the Sales Agent, bear to the aggregate public offering
price ofthe Shares.
The relative fault of the Company on the one hand and the Sales Agent on the other hand shall be determined by reference to,
among other things, whether any such untrue or alleged untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company or by ttre Sales Agent and the parties'relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Sales Agent agree that it would not be just and equitable if contribution pursuant to this Section 8 were
determined by pro rata allocation or by any ottrer method of allocation which does not take account of the equitable considerations
referred to above in this Section 8. The aggregate amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 8 shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in investigating, preparing or defending against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement of a material fact or omission or alleged omission of a material fact.
Notwithstanding the provisions of this Section 8, the Sales Agent shall not be required to contribute any amount in excess of
the amount by which the total amount in respect of commissions or underwriting discounts received by the Sales Agent pursuant to this
Agreement exceeds the amount of any damages which the Sales Agent has otherwise been required to pay by reason of any such
untrue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of Section I I (f) of the 1933 Act) with respect to the
offering of Shares pursuant to this Agreement shall be entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.
For purposes of this Section 8, each affiliate, director and officer of the Sales Agent and each person, if any, who controls the
SalesAgentwithin the meaning of Section l5 of the 1933 Act or Section 20 of the 1934 Act shall have the same righs to contribution
as the Sales Agent, and each director of the Company, each offrcer of the Company, and each person, if any, who controls the
Company within the meaning of Section l5 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to contribution as
the Company.
SECTION 9. Representations. Warranties and Agreements to Survive.
All of ttre respective representations, warranties and agreements of the Company and the Sales Agent contained in this
Agreement, or in certificates of officers of the Company delivered pursuant to this Agreement, shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of the Sales Agent or controlling person of the Sales Agent, or by or on
behalf of the Company, or any director, officer or controlling person of the Company, and shall survive delivery of and payment for the
Shares.
23
SECTION 10. TerminationifAgrcqm-cnl
(a) Termination by the Sales Agent. The Sales Agent may terminate this Agreement, at any time
(i) if there has been since the date of the latest audited balance sheet included in ttre Registration Statement and the
hospectus any Material Adverse Change, or
(iD bankruptcy, insolvency, reorganization, or liquidation proceedings or other proceedings for relief under any other
law for the relief of debtors shall have been instituted by or against the Company or any Designated Subsidiary, or
(iiD the Company or any Designated Subsidiary shall have made an assignment for the benefit of creditors or shall
have applied to the appointnent of a receiver or trustee for such entity or for all or substantially all of its property or business, or
such a receiver or trustee shall otherwise have been appointed, or
(iv) the Common Stock shall no longer be listed on the NYSE, or
(v) if there has occurred any material adverse change in the financial markets in the United States or in the
international financial markets, any outbreak of hostilities or escalation thereof or other calamity or crisis or any change or
development involving a prospective change in national or international political, financial or economic conditions, in each case
the effect of which is such as to make it, in the judgment of the SalesAgent, impracticable or inadvisable to offer, sell or deliver
the Shares or to enforce contracts for the sale ofthe Shares, or
(vi) if trading in the Common Stock has been suspended or materially limited by the Commission or the New York
Stock Exchange, or if trading generally on the New York Stock Exchange or the NYSE MKT. or in the NASDAQ Global
Market or the NASDAQ Global Select Market has been suspended or materially limited, or minimum or maximum prices for
trading have been fixed, or maximum ranges for prices have been required, by either of such exchanges or Nasdaq Stock
Market, Inc. with respect to such markets or by order of the Commission or any other governmental authority, or
(vii) a material disnrption has occurred in commercial banking or securities settlement or clearance services in the
United States, or
(viii) if a banking moratorium has been declared by either federal or New York authorities.
The Sales Agent may terminate this Agreement for any other reason, upon ten days' advance notice to the Company.
(b) Termination by the Company. The Company may terminate this Agreement at any time, upon one Tirading Day's advance
notice to the Sales Agent.
(c) Liabililies.If this Agreement is terminated pursuant to ttris Section, such termination shall be without liability of any party
to any other party except as provided in Section 5 hereof; andprcvided, further, that Sections 2,7,8 and 9 shall survive such
termination and remain in full force and effect.
24
SECTION I l. Notices.
(a) General. Except as hereinafter provided, all notices, requests and other communications hereunder shall be in writing and
shall be deemed to have been duly given if received by mail, electronic mail or transmitted by any standard form of telecommunication
to the addresses set forth in this section or to such other address as such party shall have specified most recently by written notice.
Notices to the Sales Agent shall be directed to it at J.P. Morgan Securities LLC, 383 Madison Avenue, New York, NY 10179, attention:
Adam S, Rosenbluth, Email: [e-mail] and Brett Chalmers, Email: [e-mail], with a copy
(which shall not constitute notice) to: Choate, Hall & Stewart LLB Two International Place, Boston, MA 02110, attention: Andrew J.
Hickey, Esq., Fax No. (617) 2484000; and notices to the Company shall be directed to it at l4ll East Mission Avenue, Spokane,
Washington 99202, attention: Treasurer, Fax No. [phone], e-mail: [e-mail].
( b ) Sales Notice; Confirmation and Settlement of Sales; Suspension of Sales. Al1 Sales Notices shall be executed by an
individual named on Schedule A hereto who is the President a Senior Vice President, a Vice President, the Treasurer or an Assistant
Treasurer of the Company, and shall be delivered to any of the personnel of the Sales Agent listed on Schedule A hereto. Any
comments by the Sales Agent on any Sales Notice shall be delivered to any of the personnel of the Company listed on Schedule A
hereto. All notices and other correspondence to and from the Company and the Sales Agent with respect to the confirmation and
settlement of sales of Shares or suspension of sales of Shares shall be delivered to the personnel of the Company and the SalesAgent
listed on Schedule A hereto. Either party may update its personnel listed on Schedule A by written notice to the other party.
SECTION 12. Parties in Interest.
This Agreement shall inure to the benefit of and be binding upon the Sales Agent and the Company and their respective
successors. Nothing expressed in this Agreement is intended or shall be construed to give any person, firm or corporation, other than
the Sales Agent and the Company and their respective successors and the controlling persons and officers and directors referred to in
Sections 7 and 8 and their heirs and legal representatives, any legal or equitable right, remedy or claim under or in respect of this
Agreement or any provision herein contained. This Agreement and all conditions and provisions hereof are intended to be for the sole
and exclusive benefit of the Sales Agent and the Company and *reir respective successors, and said controlling persons and officers
and directors and their heirs and legal representatives, and for the benefit of no other person, firm or corporation. No purchaser of
Shares from the Sales Agent shall be deemed to be a successor by reason merely of such purchase.
SECTION 13. No Advisory or Fiduciary Relationship.
The Company acknowledges and agrees that (a) the offering and sale of ttre Shares pursuant to this Agreement, including the
determination of the public offering price of the Shares and any related commissions and discounts, is an arm's-length commercial
transaction between the Company, on the one hand, and the Sales Agent, on the other hand, (b) in connection with the offering
contemplated hereby and the process leading to such transaction, the Sales Agent is and has been acting solely on its own behalf and is
not the agent or fiduciary of the Company, or its shareholders, creditors, employees or any other party, (c) the Sales Agent has not
assumed and will not assume an advisory or fiduciary responsibility in favor of the Company with respect to the offering contemplated
hereby or the process leading thereto (irrespective of whether the Sales Agent has advised or is currently advising the Company on
other matters) and the Sales Agent has no obligation to the Company with respect to the offering contemplated hereby except the
obligations expressly set forth in this Agreement, (d) the Sales Agent and its affiliates may be engaged in, and may in the future engage
in, a broad range of transactions that involve interests that differ from those
of the Company and (e) the Sales Agent has not provided any legal, accounting, regulatory or tax advice with respect to the offering
contemplated hereby, and the Company has consulted its own legal, accounting, regulatory and tax advisors to the extent it deemed
appropriate.
SECTION 14. Governing Law and Time.
This agreement and any claim, controversy or dispute relating to or arising out of this Agreement shall be governed by
and construed in accordance with the internal laws of the State of New York applicable to agreements made and to be performed
within the State of New York without giving effect to principles of conflicts of laws thereof . Specified times of day refer to New
York City time. Any action, suit or proceeding to enforce any provision of, or based on any matter arising out of or in connection with,
this Agreement or the transactions contemplated hereby shall be brought in any federal court located in the Southem District of the State
of New York or any New York state court located in the Borough of Manhattan, and the Company agrees to the exclusive jurisdiction
of such courts (and of the appropriate appellate courts therefrom), and each party waives (to the full extent permitted by law) any
objection it may have to the laying of venue of any such suit, action or proceeding in any such court or that any such suit, action or
proceeding has been brought in an inconvenient forum.
SECTION 15. Waiver of Jury Trial.
The Company and the Sales Agent each hereby irrevocably waives any right it may have to a trial by jury in respect of any
claim based upon or arising out of this Agreement or any fransaction contemplated hereby.
SECTION 16. Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all such counterparts
shall together constitute one and the same agreement.
SECTION 17. Entire Agreement.
This Agreement supersedes all prior and contemporaneous agreements and understandings (whether written or oral) between
the Company and the Sales Agent with respect to the subject matter of this Agreement.
SECTION 18. Effect of Headinss.
The Section headings herein and the Table ofContents are for convenience only and shall not affect the construction hereof.
SECTION 19. No Assignment.
No party may assign its rights or delegate its duties or obligations under this Agreement without the consent of the other party.
Any purported assignment or delegation of righs, duties or obligations hereunder shall be void and of no effect. Notwithstanding the
foregoing, the Sales Agent may assign its rights under this Agreement and/or may delegate some or all of its duties and obligations
under this Agreement, without the consent of the Company, to an affiliate of the Sales Agent that is a registered broker-dealer, it being
understood that no such assignment or delegation shall release the Sales Agent from any of is obligations hereunder.
26
SECTION20. Severability.
This Agreement and each Tenus Agreement shall bs deemed severable, and thc invalidity or unenforceability of any term or
provision hereof or thereof shall not affect the validity or enforceabilit5r hereof or thereof or of any term or provision hereof or thereof.
Furthermore, if any term or provi$ion of this Agreement or any Terms Agreement is determined to be invalid or unenforceable, there
shall be deemed to be made to such term or provision such minor changes (and only such minor changes) as shall be necessary to make
it valid and enforceable.
27
If the foregoing is in accordanc€ with your understanding of our agreement please sign and return to the Company a
counterpart hereof, whereupon this instnrmen! along with all counter?arts, will become a binding agreement between the Sales Agent
and the Company in accordance wi& its terms.
Vcry tnrly youn,
AVISTA CORPORATION
By: /s/MartT.Thies
Name: Mark T. Thies
Titlc: ScniorVicePresident,
Chief Financial Offi cer and
Treasurer
Signature Page to Sales Agency Agreement
CONFIRMED A}.ID ACCEPTED
as ofthc date first above writtcn
J.P. MORGAN SECURTflES LLC
By: /J Adam S, Roscnbluth
Name: Adam S. Roscnbluth
Title: Executive Director
Signature Page to Sales Agency Agreement
SCHEDI'LE A
Contact Persons
The Comoanv
Mark T. Thies
Senior Vice President Chief Financial Officer and Treasurer
Mark.Thies@avi stacom.com
T:509-495-4639
Ryan L. Krasselt
Vice President, Controller and Principal Accounting Officer
[e-mail]
T:509495-2273
Don M. Falkner
Assistant Treasurer
[e-mail]
T:509495-4326
Richard N. Stevens
Assistant Treasurer and Director of Finance
Rich. Stevens@avistacorp. com
T: 509-495-4330
Lauren Pendergraft
Senior Treasury Analyst
Lauren.Pendergraft@avistacorp. com
T:509-495-2998
Solely for notices and other correspondence to the Compeny with respect to the conlirmation and settlement of sales of
Shares, please include:
Denise Burns
Cash Management Analyst
Denise. Burns@.avistacorp.com
T:509495-4725
Treasury Department
[e-mail]
Schedule A-1
The Sales Agent
Adam S. Rosenbluth
Executive Director
adam. [e-mail]
T:212-622-7027
Brett Chalmers
Associate
brett. chalmers@jpmorgan. com
T:212-622-2252
Jemil D. Salih
Executive Director
iemil. d. [e-mail]
T:212-662-2723
Ara H. Movsesian
Executive Director
[e-mail]
T:212-622-2619
IDate]
J.P. Morgan Securities LLC
[Attention:
Tel. No.
Fax No.:E-Mail: I
Reference is made to the Sales Agency Agreement between Avista Corporation (the "Company") and J.P. Morgan Securities LLC, dated as of March
2, 2016 (capitalized terms herein having the meanings assigned thereto in zuch Agreement). The Company confirms that all conditions to the delivery
of this Sales Notice are satisfied as of the date hereof. As of the date hereof, neither the Prospectus nor the Disclozure Package contains an untrue
statement of a material fact or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
First date of Selling Period:
Last date of Selling Period:
Number of days in Selling Period:
Settlement Dat{s):
Number of Shares:
Floor Price*:
Company Bank Account
Third Trading Day after each sale
$-----______per share
*The Floor Price shown above shall be applicable to any Shares to be sold during such Selling Period. Such Floor Price may be adjusted by the
Company during such Selling Period. Norwithstanding tle foregoing, in no event shall the Sales Price for any Shares be less than $_ below
the last sale price at which the Company's Common Stock was quoted on the record of composite transaclions reported by The Wall Street
Journal on the Trading Day immediately preceding the day for fixing the price of such Shares.
Additional Restrictions:
Comments:
AVISTA CORPORATION
By:
Name:
tTitle:
rTo be executed by the President, any Vice President, the Treasurer or any Assistant Treasurer ofthe Company.
Exhibit A-l
Exhibit 1.4
AVISTA CORPORATION
(a Washington corporation)
Common Stock
SALES AGENCY AGREEMENT
Dated: March 2,2016
SECTION I.
SECTION2.
SECTION 3.
SECTION4.
Certain Definitions
Representations and Warranties
(a) Representations and Wananties of the Company
(i)
(ii)
(iii)
(iv)
(ix)
(x)
(xi)
Pase
I
5
5
6
6
7
7
7
7
8
8
8
8
8
8
8
9
9
9
l0
l0
l0
l0
l0
ll
ll
ll
t2
t2
t2
12
t2
t2
l3
l3
l3
l3
t4
t4
t4
t4
(v) No Material Adverse Change
(vi) Good Standing ofthe Company and Designated Subsidiaries
(vii) No Significant Subsidiaries
(viii) Capitalization
Compliance with Securities Law Requircments
Incorporated Documents
Independent Accountants
Financial Statements
Authorization of this Agreement
Authorization of the Shares
Description ofthe Common Stock
(xii) Registration; Listing
(xiii) Actively Traded Securities
(xiv) Absence ofDeftults
(xv) No Conflict
(xvi) Absence ofProceedings
(xvii) AbsenceofFurtherRequirements
(xviii) Title to Property
(xix) Leases
(xx)Investment Company Act
(xxi) Environmental Laws
(xxii) Intemal Controls
(xxiii) CompliancewithSarbanes-Oxley
(xxiv) Finder's Fees
(xxv) Sanctions
(xxvi) Compliance with Money Laundering Laws
(xxvii) No Unlawfirl Payments
(b) OfJi c e r's C ert ifi c ate s
Offers and Sales ofShares
(a) Iniliation of Sales Eflorts
(b) Manner of Oller and Sales
(c) Sales Pice
(d) ConJirmation of Sales
(e) Settlement ofSales
(f Suspension of Sales
(g) Propietary Trading by the Sales Agent
(h\ Limitations
Covenants
(a) Preparation and Filing of the Prospectus
(b) Review ofAmendments and Supplements
(c) Free Writing Prospectuses
(d) NotiJication of Commission Comments and Orders, Etc.
(e) Delivery of Registration Statements
(f) Del ivery of Prosp ectuses
(g) Continued Compliance with Securities lnws
(h) Blue SIE Qualifications
(i)Rule 158
() Filing Fees
(k) Use of Proceeds
(l) Restriction on Sale of Shares
(m) Maxinatm Number
(n) Regulation M
(o) Di I i genc e C o o p e ra ti o n
Payment ofExpenses
(a) Expenses Payable by the Company
(b) Expenses Payable by the Sales Agent
(c) Expenses Upon Tennination
Conditions of the Sales Agent's Obligations; Termination ofAgreement
(a\ Conditions
(i)
(iD
(iii)
(iv)
(v)
(vi)
t4
l5
l5
l5
l5
l5
l6
l6
t7
t7
t7
t7
l7
l7
t7
t7
l8
l8
l8
t8
l8
l9
l9
t9
20
20
20
20
20
20
2l
2l
22
22
22
24
24
24
25
25
25
SECTION 5.
SECTION 6.
SECTION 7.
No Stop Oder; Commission Filings
Opinions ofCounselfor the Company
Opinion ofCounselfor the Sales Agent
N o Ma ter ia I Adve rse C h a n ge ; OlJice rs' C ertifi cat e
Accountant's Con{ort Leuer
Additional Conditions
SECTION 8.
SECTION9.
SECTION IO.
SECTION I I
(vii) Additional Documents
(viii) AdditionalConditionsfor"Distibutions"
S\ Termi n atio n of Agree me n t
(c) Increase of Maximum Number
Indemnification
(a) Indemnilication of the Sales Agent
(b) IndemniJication of the Company
(c) Actions against Parties; Notification
Contribution
Representations, Warranties and Agreements to Survive
Termination of Agrcement
(a) Termination by the Sales Agent
(b) Termination by the Company
(c) Liabilities
Notices
lt
SECTION 12.
sEcfioN 13.
SECTION I4.
SECTION I5.
SECTION I6.
SECTION 17.
SECTION I8.
SECTION 19.
SECTION20.
SCHEDTJLES
Schedule A
EXIIBITS
E,(hibitA
(a) General
(b) Sales Notice; ConJintution and Settlencnt of Sales; Suspension of Sales
Parties in Interest
No Advisory or Fiduciary Relatiooship
Governing Lawand Time
WaiverofJury Trial
Counterparts
Entire Agreemcnt
Efrect ofHeadings
No Assignment
Severability
Contact Persons
Form ofSales Notice
25
25
25
25
26
26
26
26
26
26
27
Sch A
A-l
ul
AVISTA CORPORATION
(a Washington corporation)
Common Stock
SALES AGENCY AGREEMENT
March 2,2016
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
One Bryant Park
New York, NY 10036
Ladies and Gentlemen:
Avista Corporation, a Washington corporation (the "Company"), confirms its agreement (the "Agreement") with Merrill
Lynch, Pierce, Fenner & Smith lncorporated (the "Sales Agent"), whereby the Company, subject to the terms and conditions set forth
herein, may from time to time offer shares ("Shares") of its Common Stock, without nominal or par value ("Common Stock'), and the
Sales Agent, subject to such terms and conditions, shall offer Shares for sale as the Company's sales agent or, in limited circumstances
with the agreement of both the Company and the Sales Agent, may purchase Shares as principal.
The Company may enter into one or more agreements substantially identical to this Agreement (each an "Other Agreement")
with other investment banking firms as sales agents (each an "Other Sales Agent") whereby, subject to the terms and conditions set
forth herein and therein, the Company may from time to time offer Shares and the Other Sales Agent party thereto, subject to such terms
and conditions, shall offer Shares for sale as the Company's sales agent or, in limited circumstances with the agreement of both the
Company and such Other Sales Agent, may purchase Shares as principal.
The maximum number of Shares that the Company may issue and sell under this Agreement and all the Other Agreements,
collectively, is the Maximum Number (as hereinafter defrned).
On February 25,2016, the Company filed with the Securities and Exchange Commission (the "Commission") a registration
statement on Form S-3 (No. 333-209714), for the registration of securities, including the Shares, under the Securities Act of 1933, as
amended (t}re "1933 Act"), and the offer and sale thereof from time to time in accordance with Rule 415 of the rules and regulations of
the Commission under the 1933 Act (the "1933 Act Regulations").
SECTION l. Certain Definitions
When used in this Agreement, the following terms have the meanings specified below:
"Accounting Controls" has the meaning set forth in Section 2(a)(xxii)(I).
"Agreements and Instrments" has the meaning set forth in Section 2(a)(xiv).
"Applicable Time" means the time of each sale of Shares pursuant to this Agreement.
"Base Prospectus" means the base prospectus relating to the Shares filed as part of the Registration Statement, in the form in
which it has been most recently filed with the Commission prior to the Closing Time.
"Closing Time" means the time and date of the execution and delivery of this Agreement.
"Commercially Reasonable Efforts" means, with respect to the obligation of the Sales Agent to offer and sell Shares,
commercially reasonable efforts consistent with its normal trading and sales practices and in compliance with applicable law.
"Commission" has the meaning forth in the preamble to this Agreement.
"Commitment Period" means the period commencing on March 2, 2016 and expiring on the earliest to occur of (a) the first
date on which the Maximum Number of Shares shall have been sold under this Agreement and/or the Other Agreements, (b) the date
this Agreement is terminated pursuant to Section 6 or Section I 0 and (c) February 29, 2020.
"Common Stock" has the meaning set forth in the preamble to this Agreement.
"Company" has the meaning set forttr in the preamble to this Agreement.
"Designated Subsidiary" means each of Avista Capital, Inc., Alaska Energy and Resources Company and Alaska Electric
Light and Power Company.
"Disclosure Controls" has the meaning set forth in Section 2(a)(xxii)(Ifl).
"Disclosure Package" means, collectively, (i) the Prospectus as of any particular time and (ii) any other Issuer Free Writing
hospectus relating to the offer and sale of the Shares (to the extent not superseded or modified by the hospectus or by a subsequent
Issuer Free Writing Prospectus).
*EDGAR" has the meaning set forth below in this Section l.
"Effective Time" means the date and time of the effectiveness of the Registration Statement for purposes of paragraph (f)(2)
of Rule 4308 of the 1933 Act Regulations ("Rule 4308"), as applied to the Sales Agent.
"Floor Price" means the minimum Sales Price set by the Company in a Sales Notice for any Selling Period, as such Sales
Notice may be amended from time to time during such Selling Period. The Floor Price may, in addition to setting an absolute minimum
dollar amount per Share, also be limited by reference to recent or prevailing market prices.
"Initiation Date" means each date of delivery of a Sales Notice pursuant to Section 3(a).
"Internal Controls" has the meaning set forth in Section 2(aXxxii)0ll).
"Issuer Free Writing Prospectus" means any "issuer free writing prospectus" (as defined by Rule 433 of the 1933 Act
Regulations ("Rule 433")) with respect to the Shares.
"Liens" has the meaning set forth in Section 2(a)(xviii).
"Material Adverse Change" has the meaning set forth in Section 2(a)(v).
"Material Adverse Effect" has the meaning set forth in Section 2(a)(vi).
"Maximum Number" means 3,795,199 or such higher number as shall be established pursuant to Section 6(c).
"Net Proceeds", with respect to any Shares sold hereundet means the aggregate Sales Prices for such Shares less the Selling
Commission in respect of the sale of such Shares (but before other expenses).
"NYSE" means the New York Stock Exchange.
"Other Agreement" has the meaning set forth in the preamble to this Agreement.
"Other Sales Agent" has the meaning set forth in the preamble to this Agreement.
"Primary Delivery Date" has the meaning set forth in Section 6(a)(ii).
"Prospectus" means, as of any particular time, the Base Prospecfus, as supplemented by the final prospectus supplement
relating to the offer and sale of the Shares, as filed with the Commission pursuant to Rule 424b), together with any further supplements
or amendments thereto at such time.
"PUC Orders" has the meaning forth in Section 2(aXxvii).
"Registration Statement" means, as of any particular time, the Company's registration statement on Form S-3 (No. 333-
209714), including (a) any amendments thereto at such time, (b) the exhibits and schedules thereto at such time (other than the
Statement of Eligibility on Form T-l) and (c) any prospectus filed with the Commission pursuant to Rule 424(b)that, in accordance
with Rule 4308, is deemed to be a part thereof; provided, however, that, if a new regiskation statement shall have been filed and shall
have become effective on or about the third anniversary of the initial effective date of registration statement No. 333-209714, the term
"Regishation Statement" shall mean, at and after the time of the effectiveness of such new registration statement, such new registration
statement, including amendments, exhibits and any prospectus as aforesaid.
"Regulation $T" means Regulation S-T of the Commission.
"Repayment Event" has the meaning set forth in Section 2(aXxv).
"Representation Date" has the meaning set forth in Section 2(a).
"Rule 405" means Rule 405 of the 1933 Act Regulations.
"Rule 424(b)" means Rule 424(b) of the 1933 Act Regulations.
"Sales Agent" has the meaning set forth in the preamble to this Agreement.
"Sales Notice" means a wriffen notice, substantially in the form of Exhibit A hereto, executed by an individual named in
Schedule A hereto who is the President, a Senior Vice President, a Vice President, the Tieasurer or an Assistant Treasurer of the
Company and delivered to the Sales Agent in accordance with this Agreement. Any Sales Notice may be amended by the Company and
the Sales Agent and, from and after the time of such amendment, the term "Sales Notice" shall mean the original Sales Notice as
amended. Any Sales Notice or amendment to a Sales Notice shall be deemed acceptable to the Sales Agent unless the Sales Agent shall
promptly notifu the Company to the contrary. Each Sales Notice shall
be delivered, and may be amended, by facsimile transmission, e-mail or other customary means of electronic communication.
"Sales Price", with respect to any Shares sold hereunder, means the price per Share paid to the Sales Agent for such Shares.
"Secondary Delivery Date" has the meaning set forth in Section 6(a)(iiXB).
"Selling Commission", with respect to any Shares sold hereunder, means the commission, discount or other compensation to
be received by the Sales Agent in connection with the sale of such Shares.
"Selling Period" means a period of one to 20 consecutive Trading Days specified by the Company in a Sales Notice,
commencing no earlier than the Trading Day next succeeding the Trading Day on which such Sales Notice is delivered to the Sales
Agent.
"Settlement I)ate" means, with respect to the sale of any Shares, the third business day following the Trading Day on which
an offer to sell such Shares was accepted.
"Shares" has the meaning set forth in the preamble to this Agreement.
"Terms Agreement" means an agreement between the Company and the Sales Agent that relates to the issuance and sale by
the Company, and the purchase by the Sales Agent as principal (and not as agent), of a specific number of Shares and otherwise
incorporates the terms and provisions of, and is deemed a part o{ this Agreement.
"Trading Day" means any day on which the NYSE is open for trading (other than a day on which trading is scheduled to
close prior to its regular weekday closing time).
"1933 Act" has the meaning set forth in the preamble to this Agreement.
"1933 Act Regulations" has meaning set forth in the preamble to this Agreement.
"1934 Act" means the Securities Exchange Act of 1934, as amended.
"1934 Act Regulations" means the rules and regulations of the Commission under the 1934 Act.
The foregoing definitions are subject to the following qualifications:
(a) all references in this Agreement to the Registration Statement or the Prospectus or to any of the frrancial statements,
schedules or other information that is "contained", "included" or "stated" (or other words of like import) therein shall be deemed to
include the information contained in documents filed with the Commission under ttre 1934 Act that (i) are incorporated, or deemed
incorporated, therein by reference pursuant to Item 12 of Form S-3 under the 1933 Act, to the extent such information has not been
superseded or modified in accordance with Rule 412 of the 1933 Act Regulations (as qualified by Rule a30B(g) of &e 1933 Act
Regulations) and (ii)(A) in the case of references to the "Registration Statemenf', are filed with the Commission at or prior to the
Effective Time and (B) in the case of references to the "Prospectus", are filed with the Commission at or prior to the date thereof;
(b) all references in this Agreement to an amendment to the Registration Statement shall be deemed to include any document
filed under the I 934 Act subsequent to the date thereof that is deemed incorporated by reference therein pursuant to Item I 2 of Form S-
3 under the 1933 Act;
(c) all references in this Agreement to an amendment or supplement to the Prospectus shall be deemed to include any
document filed under the 1934 Act subsequent to the date thereof that is deemed incorporated by reference therein pursuant to Item I 2
of Form S-3 under the I 933 Act; and
(d) all references in this Agreement to the Registration Statement, any Issuer Free Writing Prospectus, the Prospectus or any
amendment or supplement to any of the foregoing shall be deemed to include the copy frled with the Commission pursuant to its
Electronic Data Gathering, Analysis and Retrieval system ("EDGAR").
SECTION 2. Representations and Warranties.
( a ) Representations and Warranties of the Company. The Company represents and warrants to the Sales Agent as of the
Closing Time, each Initiation Date, each Trading Day and each Applicable Time within each Selling Period, each Settlement Date, each
date as of which the Registration Statement shall be amended and each date as of which the Prospectus shall be amended or
supplemented (each such date a "Representation Date") as follows:
(i) Compliance with Securities Law Requirements.
(A) Well-Known Seasoned Issuer Status. At the time the Registration Statement was filed with the Commission,
at all relevant determination dates, and at the date hereoi the Company was and is a "well-known seasoned issuer" (as
defined in Rule 405).
( B ) Eligibility to Use Form S-3. At the time the Registration Statement was filed with the Commission and at
the time of the most recent amendment, if any, to the Registration Statement for purposes of complying with Section
I 0(a)(3) of the I 933 Act, the Company met the requirements for use of Form S-3 under the I 933 Act.
( C ) Status and Content of the Registration Statement. The Registration Statement became effective
automatically upon the filing thereof with the Commission under the 1933 Act. No stop order suspending the
effectiveness of the Registration Statement has been issued under the 1933 Act and no proceedings for that purpose
have been instituted by the Commission orare pending or, to the knowledge of the Company, have been threatened or
are contemplated by the Commission, and any request on the part of the Commission for additional information with
respect to the Registration Statement has been complied with. At the time the Registration Statement became effective,
and at the Effective Time, the Registration Statement complied in all material respects with the requirements of the 1933
Act and the 1933 Act Regulations. At the Effective Time, the Registration Statement did not contain an untrue statement
of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein
not misleading.
( D ) Issuer Free Writing Prospgctuses. At the earliest time after the filing of the Registration Statement that the
Company or another offering participant made a bona fide offer (within the meaning of Rule 164(h)(2) of the 1933 Act
Regulations) of the Shares, the Company was not an "ineligible issuer" as defined in Rule 405. Each Issuer
Free Writing Prospectus, at the time it was filed with the Commission pursuant to Rule 433 or, if it was not required to be
so filed, at the time of each use thereof (i) did not include any information that conflicts with (A) information contained
in the Registration Statement, including any prospectus or prospectus supplement that is part of the Registration
Statement, and not superseded or modified, or (B) information contained in the Company's periodic and current reports
filed with the Commission pursuant to Section l3 or l5(d) of the 1934 Act that are incorporated or deemed incorporated
by reference in the Regisradon Statement, and not superseded or modified, and (ii) complied in all other respects with
the requirements of Rule 164 and Rule 433 (without reliance on subsections (b), (c) and (d) of Rule 164 of the I 933 Act
Regulations). No order preventing or suspending the use of any Issuer Free Writing Prospectus has been issued by the
Commission.
( E ) Content of the Disclosure Package. The Disclosure Package, at the Closing Time and at each Initiation
Date, each Applicable Time within each Selling Period and each Settlement Date, will not contain any untrue statement
of material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(F) Status and Content of the Prosoectus. The Prospectus, at the Closing Time, as of its date and at the time it is
filed with the Commission and at each Initiation Date, each Applicable Time within each Selling Period and each
Settlement Date, will conform in all material respects with the requirements of the 1933 Act and the 1933 Act
Regulations and, as of such respective dates, will not contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of the circumstances under which they were
made, not misleading. The Prospectus delivered to the Sales Agent in connection with the offering of the Shares, and
any amendment or supplement thereto, will be identical to the copies thereof filed electronically with the Commission
pursuant to EDGAR (except that the registration fee table will be deleted from the cover thereof), except to the extent
permitted by Regulation S-T.
( G ) Description and Filing of Conhacts and Documents. All contracts or documents that are required to be
described in the Registration Statement or the hospectus or to be filed as exhibits to the Registration Statement have
been so described and filed as required.
The representations and warranties in this subsection (a)(i) shall not apply to any statements in or omissions from the
Registration Statement, any Issuer Free Writing Prospectus, the Disclosure Package or the Prospectus made in reliance upon and
in conformity with information fumished to the Company in writing by the Sales Agent expressly for use therein.
(ii) Incorporated Documents. The documents incorporated or deemed incorporated by reference in the Registration
Statement and the Prospectus, at the time they were or hereafter are filed with the Commission, complied or will comply, as
applicable, in all material respects with the requirements of the 1934 Act and ttre 1934 Act Regulations and, when filed did not
and will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not misleading.
(iii) Indeoendent Accountants. The accountants who audited the financial statements and financial statement schedules
included in the Registration Statement, the
Disclosure Package and the Prospectus are independentregistered public accountants within the meaning of Regulation S-X ol
the Commission.
(iv) Financial Statements. The financial statements, together with the respective schedules and notes relating thereto,
included in the Registration Statement the Disclosure Package and the Prospectus, present fairly the financial position of the
Company and its consolidated subsidiaries atthe dates indicated and the results of operations and cash flows of the Company
and its consolidated subsidiaries for the periods specified; such financial statements have been prepared in conformity wittr
United States generally accepted accounting principles applied on a consistent basis throughout the periods involved, except
as otherwise stated therein. The selected financial data and the summary financial information included in the Registration
Statement, the Disclosure Package and the Prospectus present fairly the inforrnation shown therein and have been compiled on
a basis consistent with that of the audited financial statements included in the Registration Statement. The financial statements
and other financial data included in the Registration Statement and the Prospectus comply in all material respects with the
requirements of paragraph (e) of Item l0 of Regulation S-K. The interactive data in eXtensible Business Reporting Language
filed as exhibis to the documents incorporated by reference or deemed to be incorporated by reference into the Registration
Statement and the Prospectus fairly presents the information called for in all material respects and has been prepared in
accordance with ttre Commission's rules and guidelines applicable thereto. Except as disclosed in the Registration Statement,
the Disclosure Package and the Prospectus, neither the Company nor any of its subsidiaries has any off-balance sheet
arrangements of the character contemplated by Item 303 of Regulation S-K or otherwise by Section l3G of the 1934 Act, or
has any other contingent obligation or liability, which, in any case, is material, or is reasonably likely to be material, to tlre
Company and its consolidated subsidiaries considered as one enterprise.
( v ) No Material Adverse Change. Since the date of the latest audited balance sheet included in the Registration
Statement, the Disclosure Package and the Prospectus and except as disclosed therein, there has been no material adverse
change, or any development that could reasonably be expected to result in a material adverse change, in the condition
(financial or otherwise), business, properties or results of operations of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business (any such change or development, a "Material Adverse
Change").
(vi) Good Standing of the Company and Designated Subsidiaries. Each of the Company and each of the Designated
Subsidiaries has been duly incorporated and is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation and has the corporate power and authority to own or lease and operate its properties and to
conduct its business as described in the Registration Statement, the Disclosure Package and the Prospectus, and the Company
has the corporate power and authority to enter into and perform its obligations under this Agreement and the Other
Agreements; and the Company is duly qualified as a foreign corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whetherby reason of the ownership or leasing of property orthe conduct
of business, except where the failure so to qualiff or to be in good standing would not have a material adverse effect on the
condition (financial or otherwise), business, properties or results of operations of the Company and its subsidiaries considered
as one enterprise, whether or not arising in the ordinary course of business (any such effect, a "Material Adverse Effect").
(vii) No SignificantSubsidiaries. The Company has no "significantsubsidiaries" as defined in Rule l-02 of Regulation
s-x.
(viii) Capitalization. The auttrorized, issued and outstanding capital stock of the Company is as set fonh in the
Registration Statement and the Prospectus. All of the issued and outstanding shares of Common Stock of the Company have
been duly authorized and validly issued and are fully paid and non-assessable. All of the issued and outstanding shares of
capital stock of each Designated Subsidiary have been duly authorized and validly issued, are fully paid and non-assessable
and are owned, directly or indirectly, by the Company, free and clear of any Liens.
( i x ) Authorization of this Agreement. This Agreement has been duly authorized, executed and delivered by the
Company.
( x ) Authorization of ttre Shares. The Shares have been duly authorized by the Company and, when issued and
delivered by the Company pursuant to this Agreement or any of the Other Agreements against payment of the consideration
contemplated herein or therein, will be validly issued, fully paid and non-assessable; no holder of the Shares will be subject to
personal liability in respect of liabilities of the Company solely by reason of being a holder of the Shares; and the issuance of
the Shares is not subject to the preemptive or other similar rights of any securityholder of the Company. Except as disclosed in
the Registration Statement and the Prospectus, there are no outstanding options, warrants, conversion rights, subscription
rights, rights of first refusal or other rights or agreements of any nature outstanding to subscribe for or to purchase any shares
of Common Stock of the Company binding on the Company (except pursuant to dividend reinvestment, stock purchase or
ownership, stock option or other director or employee benefit plans), and there are no outstanding securities or instruments of
the Company containing anti-dilution or similar provisions that will be triggered by the issuance of the Shares as described in
this Agreement or the Other Agreements. Except as disclosed in the Registration Stratement and the Prospectus, there are no
restrictions upon the voting or ftansfer of any shares of the Company's Common Stock pursuant to the Company's Restated
Articles of Incorporation or By-laws. There are no agreements or other obligations (contingent or otherwise) that may require
the Company to repurchase or otherwise acquire any shares of its Common Stock. No person or entity has the right,
contractual or otherwise, to cause the Company to issue to it or to register pursuant to the 1933 Act, any shares of Common
Stock upon the filing of fie Registration Statement or the issuance or sale of the Shares hereunder. Immediately after any sale
of Shares by the Company under this Agreement and the Other Agreements, the aggregate number of Shares that have been
issued and sold by the Company hereunder and thereunder will not exceed the aggregate amount of Common Stock (A)
registered and available under the Registration Statement or (B) that shall be authorized by the PUC Orders from time to time.
( x i ) Descriotion of the Common Stock. The description of the Common Stock in the Registration Statement, the
Disclosure Package and the Prospectus is accurate in all material respects.
(xii) Registration: Listing. The Common Stock is registered as a class under Section l2(b) of the 1934 Act. The
outstanding shares of Common Stock are listed, and the Shares are authorized for listing (subject to official notice of issuance),
on the NYSE.
(xiii) Actively Traded Securities. The outstanding shares of Common Stock are "actively traded securities" excepted
from the provisions of Rule l0l of Regulation M of the 1934 Act Regulations by virtue of subsection (c)(1) of such rule.
(xiv) Absence of Defaults. Neither the Company nor any Designated Subsidiary is in violation of its articles of
incorporation or byJaws or in default in the
perforrnance or observance of any obligation, agreement, covenant or condition contained in any contract, indenfure,
mortgage, deed of trust, loan or credit agreement, note, lease or other agreement or instrument to which the Company or such
Designated Subsidiary is a party or by which it or such Designated Subsidiary may be bound, or to which any of the property
or assets of the Company or such Designated Subsidiary is subject (collectively, "Agreements and Instruments") except for
such defaults as, singly or in the aggregate, would not result in a Material Adverse Effect.
(xv) No Conflict. The execution and delivery by the Company of this Agreement and the Other Agreements and the
consummation by the Company of the transactions contemplated herein and therein (including the issuance and sale by the
Company of the Shares and the use of the proceeds from the sale of the Shares as described in the Registration Statement, the
Disclosure Package and the Prospectus) and compliance by the Company with its obligations hereunder and under the Other
Agreements, do not and will not, whether with or without the giving of notice or passage of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined below) under, or result in the creation or imposition of any
Lien upon any property orassets of the Company orany Designated Subsidiary pursuantto, theAgreements and Instruments
(except for such conflicts, breaches, defauls or Liens as, singly or in the a.g9regate, would not reasonably be expected to result
in a Material Adverse Effect), nor will such action result in any violation of the articles of incorporation or by-laws of the
Company or any Designated Subsidiary or of any statute of any jurisdiction applicable to the Company or any Designated
Subsidiary or any rule, regulation or order applicable to the Company or any Designated Subsidiary of any regulatory body,
administrative agency or other governmental body or any court that, in any such case, has jurisdiction over the Company or
any Designated Subsidiary or any of their respective assets, properties or operations. As used herein, a "Repayment Event"
means any event or condition that gives the holder of any note, debenture or other evidence of indebtedness (or any person
acting on such holder's behalf) the right to require the repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any Designated Subsidiary.
(xvi) Absence ofProceedings. There is no action, suit, proceeding, inquiry or investigation before or brought by any
court or govemmental agency or body, domestic or foreign, now pending, or, to the knowledge of the Company, threatened,
against or affecting the Company or any of its subsidiaries, that (A) is required to be disclosed in the Registration Statement or
the Prospechrs and is notdisclosed as required, (B) could materially and adversely affectthe consummation of the transactions
contemplated in this Agreement or any of the Other Agreements or the performance by the Company of its obligations
hereunder or thereunder or (C) except as disclosed in the Registration Statement, the Disclosure Package and the Prospectus,
would reasonably be expected to result in a Material Adverse Effect; and the aggregate of all pending legal or govemmental
proceedings to which the Company or any of its subsidiaries is a party or of which any of their respective properties or assets
is the subject that are not described in the Registration Statement, the Disclosure Package and the Prospectus, including
ordinary routine litigation incidental to the business, would not reasonably be expected to result in a Material Adverse Effect.
(xvii) Absence of Further Requirements. The Washington Utilities and Tiansportation Commission (the "WUTC"), ttre
Idaho Public Utilities Commission (the "IPUC") and the Public Utility Commission of Oregon (the "OPUC") have issued
orders authorizing the issuance and sale by the Company of the Shares on the terms contemplated in this Agreement and the
Other Agreements; the Montana Public Service Commission (the "MPSC") has issued an order disclaiming jurisdiction over
the issuance of securities and the creation of liens by the
Company pursuant to, and on the terms set forth in such order (such order, collectively with the aforesaid orders of the WUTC,
the IPUC and the OPUC, being hereinafter called the "PUC Orders"); the PUC Orders are in full force and effect as of the date
hereof; and, except for informational filings required under the PUC Orders, no further consent, approval or authorization of,
or registration, filing or declaration with, any regulatory or other govemmental body or agency is required in connection with
the execution, delivery or performance by the Company of this Agreement or the Other Agreements or the issuance and sale
by the Company of the Shares.
(xviii) Title to Properg. The Company and each of its Designated Subsidiaries have good and marketable title to all
real property owned by them and good title to all other property owned by them, in each case subject only to such mortgages,
pledges, security interests, claims and other liens and encumbrances (collectively "Liens") and such exceptions, defects and
qualifications as (A) are described in the Regisration Statement and the Prospectus or (B) would not reasonably be expected to
result in a Material Adverse Effect.
(xix) Leases. All of the leases and subleases material to the business of the Company and its Designated Subsidiaries,
considered as one enterprise, and under which the Company or any of such subsidiaries holds properties, described in or
required to be described in the Registration Statement and the Prospectus are in full force and effec! and the Company has no
notice ofany claim ofany sort asserted by anyone adverse to the rights ofthe Company or any ofsuch subsidiaries under any
of such leases or subleases, or affecting or questioning the rights of the Company or any of such subsidiaries to the continued
possession of the premises leased or subleased thereunder, that would reasonably be expected to result in a Material Adverse
Effect.
(xx) Investment CompanyAct. The Company is not, and upon the issuance and sale of the Shares as contemplated
herein and in the Other Agreements and the application of the net proceeds therefrom as described in the Registration
Statement, the Disclosure Package and the Prospectus will not be, an "investment company" or an entity "controlled" by an
"investment company" as such terms are defined in the Investrnent Company Act of 1940, as amended.
( x x i ) Environmental Laws. Except as described in the Registration Statement, the Disclosure Package and the
Prospectus, neither the Company nor any of the Designated Subsidiaries (A) is in violation of any statute, rule, regulation,
decision or order of any governmental body or any court, domestic or foreign, relating to the use, disposal or release of
hazardous or toxic substances or other pollutants or contaminants, to the protection or restoration of the environment or to
human or animal exposure to hazardous or toxic substances or other pollutants or contaminants that have the potential to
adversely impact human or animal health (collectively, "environmental laws"), (B) owns or operates any real property
contaminated with any hazardous or toxic substances or other pollutants or contaminants that is subject to clean-up or other
responsive action under any environmental laws, (C) is liable for any off-site disposal or contamination pursuant to any
environmental laws, (D) is subject to any claim of violation of or liability under any environmental laws, which violation,
contamination, liability or claim would individually or in the aggregate reasonably be expected to have a Material Adverse
Effect; and the Company is not aware of any pending investigation or circumstances which would reasonably be expected to
lead to such a claim.
(xxii) Intemal Conhols. (A)The Company has devised and established and maintains the following, among other,
internal controls (without duplication):
l0
(I) a system of "intemal accounting controls" as contemplated in Section l3(bX2XB) of the 1934 Act
(the "Accounting Controls");
0D "intemal control over financial reporting" as such term is defined in Rule I 3 a- I 5(f) of the I 934 Act
Regulations; and
0U) "disclosure contols and procedures" as such term is defined in Rule l3a-15(e) of the 1934 Act
Regulations (the "Disclosure Controls" and, together with the Accounting Controls and the Reporting Controls,
the "Internal Controls"));
(B) The Internal Controls are evaluated by the Company's senior management periodically as appropriate and,
in any event, as required by law;
(C) Based on the most recent evaluations of the Intemal Controls:
(D the Internal Controls are, individually and in the aggregate, effective in all material respects to
perform ttre functions for which they were established; and
(U) all material weaknesses, if any, and significant deficiencies, if any, in the design or operation of the
Internal Controls which are reasonably likely to adversely affect the Company's ability to record, process,
summarize and report financial information and any fraud, whether or not material, that involves management or
other employees who have a significant role in the Internal Controls have been disclosed to the audit committee
of the Company's board of directors and the Company's independent auditors.
(xxiii) Compliance with Sarbanes-Oxley. The Company is in compliance in all material respects with the Sarbanes-
Oxley Act of 2002 and the rules and regulations of the Commission *rat have been adopted thereunder, to the extent that such
act and such rules and regulations are in effect and applicable to the Company.
(xxiv) Finder's Fees. The Company has not incurred (directly or indirectly) nor will it incur, directly or indirectly, any
liability for any broker's, finder's, financial advisor's or other similar fee, charge or commission in connection with this
Agreement or the Other Agreements, or the hansactions contemplated hereby or thereby, except as set forth in or
contemplated by this Agreement and the Other Agreements.
(xxv) Sanctions. Neither the Company nor any of its subsidiaries, nor, to the knowledge of the Company, any directo4
officer or agent of the Company or any of its subsidiaries is currently the subject or the target of any sanctions administered by
the Office of Foreign Assets Control of the U.S. Department of the Tieasury or any other applicable sanctions laws or
regulations ("Sanctions"), nor is the Company or any of its subsidiaries located, organized or resident in a country or territory
that is the subject or the target of Sanctions, including, without limitation, Cuba, Iran, North Korea, Sudan and Syria (each, a
"Sanctioned Country"); and the Company will not directly or indirectly use the proceeds of the offering of the Shares
hereunder, or lend, conffibute or otherwise make available such proceeds to any person or entity, (A) to fund or facilitate any
activities of or business with any person that, at the time of such funding or facilitation, is the subject or the target of Sanctions
or (B) to fund or facilitate any activities of or business in any Sanctioned Country or (C) in any other manner that will result in
violation by any person (including any person participating in the transaction, whether as sales agent, advisor, investor or
otherwise) of Sanctions.
(xxvi) Compliance with Money Laundering Laws. The operations of the Company and its subsidiaries are and have
been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency
and Foreign Transactions Reporting Act of 1970, as amended, the applicable money laundering statutes of all jurisdictions in
which the Company and/or any of its subsidiaries conducts business, the rules and regulations thereunder and any related or
similar rules, regulations or guidelines issued, administered or enforced by any governmental or regulatory agency
(collectively, the "Anti-Money Laundering Laws"); and no action, suit or proceeding by or before any court or govemmental
or regulatory agency, authority or body or any arbitrator involving the Company or any of its subsidiaries wittr respect to ttre
Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
(xxvii) No Unlawful Payments. Neither the Company nor any of its subsidiaries, nor, to the knowledge of the
Company, any directol officer or agent of the Company or any of its subsidiaries, has violated or is in violation of any
provision of the Foreign Comrpt Practices Act of 1977, as amended (the "FCPA") or any other applicable anti-comrption
and/or anti-bribery laws and regulations. The Company and the and its subsidiaries have instituted and maintain policies and
procedures designed to promote and provide reasonable assurance as to compliance with the FCPA.
(b) Olficer's Certificates. Any certificate signed by any officer of the Company delivered to the Sales Agent or to counsel for
the SalesAgent in connection with the offer and sale of the Shares shall be deemed a representation and warranty by the Company to
the Sales Agent as to the mafters covered thereby.
SECTION 3. Offers and Sales ofShares.
(a) Initiation of Sales Elforts. Upon the terms and subject to the conditions set forth herein, on any Trading Day during the
Commitment Period the Company may deliver to the Sales Agent a Sales Notice, and, upon the commencement of the Selling Period
specified in such Sales Notice, which shall not be earlier than the Tiading Day next succeeding the date of receipt by the Sales Agent of
such Sales Notice, the Sales Agent shall use its Commercially Reasonable Efforts to sell the number of Shares specified in such Sales
Notice. The Company acknowledges that there can be no assurance that the Sales Agent will be successful in selling the Shares and
agrees that the Sales Agent shall incur no liability or obligation to the Company if it does not sell Shares for any reason other than a
failure by the Sales Agent to use its Commercially Reasonable Efforts to sell such Shares in accordance with the terms of this
Agreement.
(b) Manner of Offer and Sales. (i) The offering and sale of Shares under this Agreement (other than sales to or by the Sales
Agent as principal) shall be made by such methods permitted by law as the Sales Agent shall determine from time to time that are
deemed to be "at-the-market offerings" within the meaning of Rule ls(a)(a) of the 1933 Act Regulations, including sales made
directly on the NYSE, through an "alternative trading system" as defined in Rule 300 of Regulation ATS under the 1934 Act or any
other electronic communications network or to or through a market maker;prcvided, however, ttrat, if the Company and the Sales
Agent so agree in writing, sales may be made in privately negotiated tansactions;
(ii) If the Company and the Sates Agent so agree in a separate Terms Agreement (it being understood and agreed that neither
party is under any obligation to do so), the Company may sell Shares to the Sales Agent acting as principal, and the Sales Agent may
purchase such Shares acting as principal, it being understood that, in the event of any inconsistency between the terms and provisions
of this Agreement and those of the Terms Agreement, those of the Terms Agreement shall control.
(c) Sales Price.' (i) Sales of Shares by the Sales Agent acting as agent in At the Market Offerings or to or through a market
maker shall be made at prevailing market prices per Share or, if and to the extent so specified in the related Sales Notice, at prices per
Share related to prevailing market prices. Anything in this Agreement to the confary notwithstanding, (a) in no event shall the Sales
Price for any Shares so sold be less than the Floor Price set forth in the related Sales Notice and (b) the Company shall not establish any
Floor Price that would not be within ttre limitations prescribed by the Board of Directors of the Company.
(iD Sales of Shares by the Sales Agent as agent in privately negotiated transactions, and the public offering of Shares
purchased by the Sales Agent acting as principal, shall be made at such Sales Prices as shall be agreed upon by the Company and the
Sales Agent in the particular case, such agreement by the Company to be wi*rin the limitations prescribed by the Board of Directors of
the Company.
(iii) The Selling Commission in respect of Shares sold hereunder in At the Market Offerings or to or through a market maker
shall be such percentage (not to exceed 2%) of the Sales Price thereof, as agreed upon by the Company and the Sales Agent from time
to time, provided, however, that the Selling Commission in respect of all sales hereunder that (A) are made under a Terms Agreement,
(B) made in a transaction that constitutes a "distribution" within the meaning of Rule I 00 of Regulation M of the I 934 Act Regulations
or (C) are otherwise not At the Market Offerings or to or through a market maker shall be agreed upon by the Company and the Sales
Agent in the particular case.
(d) Confirmation of Sales. The Sales Agent shall deliver to the Company, not later than the opening of the Trading Day next
following each Tiading Day on which it makes sales of Shares hereunder, a confirmation setting forth (i) the number of Shares sold in
each transaction on such Tiading Day, (ii) the applicable Sales Price for each such sale ofShares, (iii) the aggregate Sales Price for each
such transaction and (iv) the Net Proceeds payable to the Company for each such transaction.
(e) Settlement of Sales. Subject to the conditions set forth in Section 6, each sale of Shares hereunder shall be settled on the
Settlement Date therefor. No later than I 2:00 Noon (New York City time) on the Settlement Date, the Company shall cause its transfer
agent, currently Computershare Shareholder Services LLC, to electronically transfer such Shares to the Sales Agent by crediting the
account of the Sales Agent or its designee or nominee at the Depository Trust Company through its Deposit/Withdrawal at Custodian
System, or by such other means of delivery as may be mutually agreed upon by the Company and the Sales Agent in writing. Upon
notification that the Shares have been issued, Sales Agent shall deliver the total Net Proceeds for the sale of all Shares to be settled on
such Settlement Date by wire ftansfer of immediately available funds to an account designated by the Company in the related Sales
Notice.
( f ) Suspension of Sales. The Company or the Sales Agent may, upon notice to the other party in writing or by telephone
(confrmed immediately by verifiable facsimile transmission, e-mail or other customary means of electronic communication), suspend
the offering or sale of Shares, and the Selling Period shall immediately terminate;prcvided, however, that such suspension and
termination shall not affect or impair either party's obligations with respect to any Shares sold hereunder prior to the prompt processing
of such notice of suspension.
(g) Proprietary Trading by the Sales Agent.The Sales Agent has advised the Company that during the Commitment Period the
Sales Agent and/or its affiliates may purchase and sell shares of Common Stock for their respective accounts and for the accounts of
their respective customers;provided, however, that (i) no such purchase or sale shall violate any provision of applicable law (including
particularly but without limitation the 1933 Act or the 1934 Act or any regulation under either thereof) and (ii) no sale of shares of
Common Stock shall be made by the Sales Agent for the account of the Sales Agent during any Selling Period unless (A) such sale is
made pursuant to and in accordance with the terms of a Terms Agreement, (B) such sale is a sale by the Sales Agent of shares
purchased, or deemed to have been purchased, from the Company as a "riskless principal" or in a similar capacity, (C) such sale is
made in trading transactions in the ordinary course of business but only if neither the Company nor the Sales Agent is in violation of
Regulation M of the 1934 Act Regulations or (D) the Company shall have consented thereto.
(h) Limitations. Anything in this Agreement to the contrary notwithstanding:
(D in no event shall the aggregate number of Shares sold pursuant to this Agreement, together with the aggregate
number of Shares sold pursuant to the Other Agreements (as disclosed to the Sales Agent from time to time by the Company),
exceed the Maximum Number (the Company hereby acknowledging and agreeing that the Sales Agent shall have no
responsibility for maintaining records with respect to the aggregate number of Shares sold (other than the Shares sold under this
Agreement));
(iD in no event shall the Sales Agent be obligated to make any offer or sale of Shares during any period in which either
party has reason to believe that the Common Stock is not an excepted security under Rule l0l(cXl) of Regulation M of the
1934 Act Regulations; and
(iiD in no event shall the Company sell Shares through both the Sales Agent and any Other Sales Agent on the same
Trading Day; without limiting the generality of the foregoing, in no event shall the Selling Period designated in a Sales Notice
delivered to the Sales Agent include a Trading Day that is included in a selling period that is in effect under one of the Other
Agreements; and each of the OtherAgreements shall contain the limitations sets forth in this clause (iii).
SECTION 4. Covenants.
(a) Preparation and Filing of the Prospectus. The Company will prepare the Prospectus and, after affording the Sales Agent
the opporhrnity to comment thereon, file the Prospectus with *re Commission in accordance with Rule 424(b) not later than the
Commission's close of business on the second business day following the Closing Time.
( b ) Review of Amendments and Supplements. Tlte Company will not amend the Registration Statement, or amend or
supplement the Prospectus, without providing notice to the Sales Agent at least 24 hours, or such shorter period as is reasonably
required by the circumstances, prior to the filing thereof with the Commission. Except in the case of any such amendment or
supplement to be made by the filing under the 1934 Act of a document that will be incorporated by reference in the Regisffation
Statement or the Prospectus that would be made by the Company irrespective of the offer and sale of the Shares, the Company will not
effect such amendment or supplement without the consent of the Sales Agent, such consent not to be unreasonably withheld or delayed.
Neither the consent of the Sales Agent, nor the delivery of any such amendment or supplement by the Sales Agent, shall constitute a
waiver of any of the conditions set forth in Section 6 hereof.
The Company will noti$ the Sales Agent immediately, and confirm such notice in writing, when any post-effective
amendment to the Registration Statement shall have been filed or shall become effective and when any supplement to the Prospectus or
any amended Prospectus shall have been filed.
(c) Free Writing Prospectuses. (i) The Company has not made and, without the consent of ttre Sales Agent, will not make any
offer relating to the Shares that would constitute a "free writing prospectus" as defined by Rule 405, including an Issuer Free Writing
Prospectus.
(iD The Sales Agent has not made, and without the consent of the Company shall not make, any offer relating to the Shares
that would constitute a "free writing prospectus" (as defined in Rule 405) that the Company would be required to file with the
Commission under Rule 433.
(d) Notification of Commission Comments and Orders, Etc. . The Company will notiff the Sales Agent of (i) the receipt of any
comments from the Commission with respect to the Registration Statement, any Issuer Free Writing Prospectus or the Prospectus,
including any request by the Commission for any amendment, supplement or additional information with respect thereto and (ii) the
issuance by the Commission of any stop order suspending the effectiveness of ttre Registration Statement or of any order preventing or
suspending the use of any Issuer Free Writing Prospectus or the Prospectus or the initiation or threatening of any proceeding for such
pulpose. The Company will make every reasonable effort to prevent the issuance of any stop order and, in the event of any stop order,
to obtain the lifting thereof as soon as possible.
(e ) Delivery of Regktration Statements. The Company will deliver to the Sales Agent and to counsel for the Sales Agent, upon
request and without charge, one conformed copy of the Registration Statement as originally filed and of each amendment thereto
(including, in each case, all exhibis filed therewith or incorporated by reference). Such copies of the Registration Statement and
amendments thereto so furnished to the Sales Agent will be identical to the copies thereof filed electronically with the Commission
pursuant to EDGAR (except that the registration fee table may be deleted from the cover thereof), except to the extent permitted by
Regulation S-T.
(f ) Delivery of Prospectuses. The Company will furnish to the Sales Agent, without charge, during the period when the
Prospectus (or, in lieu thereof, the notice referred to in Rule 173(a) of the 1933 ActRegulations) is required to be delivered of the 1933
Act Regulations, such number of copies of the Prospectus as the Sales Agent may reasonably request. Such copies of the Prospectus so
fumished to the Sales Agent will be identical to the copies thereof filed electronically with the Commission pursuant to EDGAR (except
that the registration fee table may be deleted from the cover thereof), except to the extent permitted by Regulation S-T. The Company
will deliver to the Sales Agent, without charge, as many copies of any Issuer Free Writing Prospectus as the Sales Agent shall
reasonably request, and the Company hereby consents to the use ofsuch copies by the Sales Agent for purposes ofthe offer and sale of
the Shares in a manner consistent with the I 933 Act and the 1933 Act Regulations.
(g) Continued Compliance with Securities laws. (i) The Company will file all reports and other documents that it is required to
file with the Commission pursuant to Sections l3(a), l3(c), 14 or l5(d) of the 1934 Act within the time periods required by the 1934
Act and the 1934 Act Regulations and will otherwise comply with the 1933 Act, the 1933 Act Regulations, the 1934 Act and the 1934
Act Regulations so as to permit the offer, sale and distribution of the Shares as contemplated in this Agreement and the Prospectus;
provided, however, that the Company may assume that the distribution of the Shares issued on any Settlement Date has been completed
on the business day following such Settlement Date unless the Sales Agent shall have provided written notice to the contrary.
15
(ii) During the distribution of the Shares, the Company will notiS the SalesAgentpromptly if (A) any filing is made by the
Company of information relating to the offering of the Shares with any securities exchange or any other regulatory body in the United
States or any ottrer jurisdiction or (B) a Material Adverse Change shall have occurred that is not disclosed in the Registration Statement
and the Prospectus or (C) any other event shall have occurred that causes (x) the Registration Statement to contain any untrue statement
of material fact or omit to state any material fact necessary in order to make the statements therein not misleading or (y) the Disclosure
Package or the Prospectus to contain any untrue statement of material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were made, not misleading.
(iiD Upon any notification pursuant to clause (ii)(B) or (C) above, or if at any time an event shall occur or other circumstances
shall exist as a result of which it is necessary, in the reasonable judgment of ttre Company or of the Sales Agent, (A) to amend ttre
Registration Statement in order that it shall not, as of the Effective Time, include any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein not misleading or otherwise to comply with the requirements of the
I 933 Act or the I 933 Act Regulations or (B) to amend or supplement the Prospectus in order that it shall not, as of any Initiation Date,
any Applicable Time within any Selling Period or any Settlement Date, contain any untrue statement of material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of the circumstances existing at such time, not misleading or
otherwise to comply with the requirements of the 1933 Act or the 1933 Act Regulations,
(A) the Company will promptly prepare and file with the Commission, subject to Section 4(b), such amendment or
supplement as may be necessary to correct such statement or omission or to make the Registration Statement or the Prospectus
comply with such requirements, and the Company will furnish to the Sales Agent such number of copies of such amendment or
supplement as the Sales Agent may reasonably request;
(B) the Company shall not deliver to the Sales Agent any Sales Notice until such stratement or omission is corrected;
and
(C) if such time shall be during a Selling Period specified in a Sales Notice theretofore delivered to the Sales Agent, the
Company shall promptly, by telephone (confirmed by electronic mail), cancel such Sales Notice and direct the Sales Agent to
cease selling Shares and making offers for such sales.
(h) Blue Slry QualiJications. The Company will use its best efforts, in cooperation with the Sales Agent, to take such action, if
any, as may be required to qualiff the Shares for offering and sale under the applicable securities laws of such states and other
jurisdictions as the Sales Agent may reasonably designate and to maintain such qualifications in effect as long as required for the
distribution of the Shares; provided, however, that the Company shall not be obligated to file any general consent to service ofprocess
or to qualiff as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to
taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject. In the event that the Company becomes
aware of the suspension of the qualification of the Shares foroffering orsale in any jurisdiction, orof the initiation orthreatening of any
proceedings for any of such purposes, the Company will so notiff the Sales Agent and will cooperate with the Sales Agent to endeavor
to preventany such suspension and, in the eventofany such suspension, to obtain the lifting thereofas soon as possible.
(i) Rule 158. The Company will timely file such reports pursuant to the 1934 Act as are necessary in order to make generally
available to its securityholders as soon as practicable an earnings
statement for the purposes of, and to provide the benefits contemplated by, the last paragraph of Section I I (a) of the I 933 Act and Rule
158 thereunder (which eamings statement need not be audited unless required so to be under Section I 1(a) of the 1933 Act).
(,) Filing Fees. The Company agr€es to pay the required Commission filing fees relating to the Shares within the time required
by Rule 456(bxl ) of the I 933 Act Regulations and otherwise in accordance with Rules 456(b) and 45 7(r) of the I 933 Act Regulations.
( k ) Use of Prcceeds. The Company will use the Net Proceeds received by it from the sale of the Shares in the manner
specified in the Prospectus under "Use of Proceeds".
(l) Restriction on Sale of Shares. The Company will not (A) at any time during any Selling Period without the prior written
consent of the Sales Agent or (B) at any time during the term of this Agreement without giving the Sales Agent at least three Trading
Days'prior written notice speciffing the nature and timing of the proposed sale, directly or indirectly, offer to sell, contract to sell, sell,
grant any option to buy or otherwise dispose of any shares of Common Stock or securities convertible into or exchangeable for shares
of Common Stock or warrants or rights to purchase or acquire shares of Common Stock. The foregoing restrictions shall not restrict the
Company's issuance or sale of (i) shares of Common Stock pursuant to this Agreement or the Other Sales Agreements, (ii) shares of
Common Stock, options to purchase shares of Common Stock or shares of Common Stock issuable upon the exercise of optrons, in any
case pursuant to any employee or director stock option or benefit plan, stock purchase or ownership plan or dividend reinvestrnent plan
of the Company, (iii) shares of Common Stock issuable upon the conversion of securities or the exercise of warrants, options or other
rights disclosed in the Registration Statement and the Prospectus or (iv) shares of Common Stock issuable as consideration in
connection with acquisitions of business, assets or securities of other entities by merger or otherwise.
( m ) Maximum Number. The Company will promptly notifr the Sales Agent and each of the Other Sales Agents when the
Maximum Number of Shares has been sold.
( n ) Regulation M. lf either the Company or the Sales Agent shall have reason to believe that the Common Stock is not an
excepted security under Rule l0l(cXl) of Regulation M of the 1934 Act Regulations, it shall promptly notiff the other party and the
Sales Agent may suspend sales of Shares under this Agreement or any Terms Agreement until, in the judgment of each party, the
Common Stock is such an excepted security.
(o) Diligence Cooperation. The Company shall reasonably cooperate with any reasonable due diligence review requested by
the Sales Agent or its counsel from time to time in connection with the transactions contemplated hereby or any Terms Agreement,
including, without limitation, on or about each Primary Delivery Date and each Secondary Delivery Date, providing information and
making available appropriate documents and appropriate corporate officers of the Company and, upon reasonable request,
representatives of Deloitte & Touche LLP.
SECTION 5. Payment ofExpenses.
(a) Expenses Payable by the Company.T}ae Company will pay all expenses incident to the performance of its obligations
under this Agreement, including (i) the preparation, printing and filing of the Registration Statement (including financial statements and
exhibits) as originally filed and of each amendment thereto, (ii) the preparation, printing and delivery to the Sales Agent of this
Agreement and such other documents as may be required in connection with the offering, purchase, sale, issuance or delivery of the
Shares, (iii) the preparation, issuance and delivery of the certificate or certificates for the Shares, (iv) the fees and disbursements of the
Company's counsel, accountants and other advisors, (v) the
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qualification of the Shares under securities laws in accordance with the provisions of Section 4(h) hereof, (vi) the printing and delivery
to the Sales Agent of copies of each Issuer Free Writing Prospectus and of the Prospectus and any amendments or supplements thereto,
(vii) the preparation, printing and delivery to the Sales Agent of copies of any Blue Sky survey and any supplement thereto, (viii) the
costs and expenses of the Company relating to investorpresentations on any "road show" undertaken in connection with the marketing
of the Shares, including without limitation, expenses associated with the production of road show slides and graphics, fees and
expenses of any consultants engaged in connection with the road show presentations, travel and lodging expenses of the Sales Agent
and ofltcers of the Company and any such consultants, and the cost of aircraft and other hansportation chartered in connection with the
road show and (ix) the reasonable documented out-of-pocket expenses of the Sales Agent, including the reasonable fees and
disbursements of counsel for the Sales Agent, in connection with the negotiation, execution and delivery of this Agreement and the
performance of its obligations hereunder during the Commitment Period, it being understood that the Company shall be required to pay
the fees and disbursements of only one counsel for the Sales Agent and the Other Sales Agents.
(b ) Expenses Payable by the Sales Agent. Except as provided in subsection (a) above and subsection (c) below, the Sales
Agent will pay all of its expenses incurred in connection with the transactions contemplated hereby, including the fees and
disbursements of any counsel for the Sales Agent (other than the one counsel for the Sales Agent and Other Sales Agents contemplated
in subsection (a)(ix) above).
( c ) Expenses Upon Termination. lf this Agreement is terminated by the Sales Agent in accordance with the provisions of
Section 6 or Section lO(aXi) hereof, the Company shall reimburse the Sales Agent for all of its out-of-pocket expenses incurred in
connection with the hansactions contemplated hereby, including the reasonable fees and disbursements of the one counsel for the Sales
Agent and the Other Sales Agents contemplated in subsection a(ix) above.
SECTION 6. Conditions of the Sales Agent's Obligations: Termination of Agreement.
(a) Conditions. The obligations of the Sales Agent hereunder are subject to the accuracy, as of the Closing Time and each
other Represeniation Date, of the representations and warranties of the Company contained in Section 2(a) hereof and in all certificates
of officers of the Company delivered pursuantto the provisions hereof, to the performance by the Company of its covenants and other
obligations hereunder to be performed at or prior to the Closing Time and each other Representation Date, and to the following further
conditions:
( i ) No Stop Order; Commission Filings. At the Closing Time and each subsequent Representation Date, the
Regisfiation Statement shall remain effective and no stop order suspending the effectiveness of the Registration Statement shall
have been issued under the 1933 Act or proceedings therefor initiated or threatened by the Commission and the Company
shall not have received from the Commission any notice pursuant to Rule a0l (g)(2) of the I 933 Act Regulations objecting to
use of the automatic shelf registration statement form, and any request on the part of the Commission for additional
information shall have been complied with to the reasonable satisfaction of counsel to the Sales Agent; the hospectus shall
have been filed with the Commission in accordance with Rule 424(b); any material required to be filed by the Company
pursuant to Rule 433(d), shall have been filed with the Commission in accordance with the applicable time period prescribed
for such filing under Rule 433; and the Company shall have paid the required Commission filing fees relating to the Shares
within the time period required by Rule 456(b)0)(D of the 1933 Act Regulations without regard to the proviso therein and
otherwise in accordance with Rules 456(b) and 457(r) of the 1933 Act Regulations and, if applicable, shall have updated the
"Calculation of Registration Fee" table in accordance with Rule a56@)(l)(ii) of
the 1933 Act Regulations either in a post-effective amendment to the Registration Statement or on the cover page of a
prospectus filed pursuant to Rule 424(b).
(ii) Opinions of Counselfor the Company. (A) At the Closing Time and within five Trading Days after the date on
which the Company shall amend the Registration Statement and/or amend or supplement the Prospectus (in each case other
than by means of the incorporation by reference of documents filed wittr the Commission) or the date on which the Company
shall file an Annual Report on Form l0-K (each such date being hereh called a "Primary Delivery Date"), the Sales Agent
shall have received the opinions, dated the date of delivery thereof, of Marian M. Durkin, Esq., Senior Vice President, General
Counsel and Chief Compliance Officer of the Company, and Pillsbury Winthrop Shaw Pittrnan LLP, counsel for the Company,
substantially in the form of Exhibits B and C hereto, respectively.
(B) Wthin five Trading Days after the date on which the Company shall file a Quarterly Report on Form l0-Q or a
Current Report on Form 8-K (except to the extent that any such Current Report "furnishes" rather than "files" the information
provided therein), and at any other time reasonably requested by the Sales Agent (each of such dates being herein called a
"Secondary Delivery Date"), the Sales Agent shall have received the opinions, dated the date of delivery &ereof, of counse I
referred to in clause (A) above, substantially in the form of Exhibits B and C hereto, respectively;provided, however, that such
counsel may deliver, in lieu of such opinions, a reliance letter to the effect that the Sales Agent may rely on the opinion
delivered on the next preceding Primary Delivery Dato to the same extent as if it were dated the date of such letter (except that
the statements in such prior opinion shall be deemed to relate to the Registration Statement as amended and the Prospectus as
amended and/or supplemented as of such Secondary Delivery Date).
(iii) Opinion of Counsel for the Sales Agent. At the Closing Time and each other Primary Delivery Date, Secondary
Delivery Date relating to a Quarterly Report on Form l0-Q and, if and to the extent reasonably requested by the Sales Agent,
each other Secondary Delivery Date, the Sales Agent shall have received the opinion, dated the date of delivery thereof, of
Choate, Hall & Stewart LLP, counsel for the Sales Agent, as to such matters as *re Sales Agent shall reasonably request. In
giving such opinion such counsel may rely, as to all matters governed by the laws of jurisdictions other than the law of the
State of New York and the federal law of the United States upon the opinions of counsel to the Company. Such counsel may
also state that, insofar as such opinion involves factual matters, they have relied, to the extent &ey deem propel upon
certificates of officers of the Company and certificates ofpublic officials.
(iv) No Material Adverse Change; Oflicers'CertiJicate. (A) At the Closing Time and each other Representation Date,
there shall not have been since the date of the latest audiled balance sheet included in the Registration Statement and the
Prospectus and except as disclosed therein, any Material Adverse Change and (B) at the Closing Time and at each other
Primary Delivery Date and each Secondary Delivery Date, the Sales Agent shall have received a certificate of the President or
a Vice President of the Company and of the chief financial or chief accounting officer of the Company, dated the date of
delivery thereoi to the effect that (I) there has been no such Material Adverse Change, (II) the representations and warranties
in Section 2(a) hereof are true and correctwith the same force and effect as though expressly made at and as of such date, (IID
the Company has complied with a1l agreements and satisfied all conditions on its part required by this Agreement to be
performed or satisfied at or prior to such date, and (IV) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been instituted or are pending or, to the knowledge of the
signers, contemplated by the Commission.
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( v ) Accountantb Comfort Letter. At the Closing Time and within five Trading Days after each date on which the
Company shall file an Annual Report on Form l0-K, a Quarterly Report on Form lO-Q or a Current Report on Form 8-K that
contains financial statements of the Company (other than any Current Report on Form 8-K that is "furnished" to and not
"filed" with the Commission), the Sales Agent shall have received from Deloitte & Touche LLP a letter dated the date of
delivery thereof, in form and scope consistent with the internal guidelines of such firm for the delivery of comfort letters and,
in any even! in form and substance reasonably satisfactory to the Sales Agent, containing statements and information of the
type customarily included in accountants' "comfort letters" to underwriters with respect to the financial statements of, and
certain financial information relating to, the Company contained in the Registration Statement, Disclosure Package and the
Prospectus.
(vi) Additional Conditions. At the Ctosing Time and on each other Representation Date, none of the events enumerated
in clauses (i), (iD, (iii) and (iv) ofSection l0(a) shall have occurred.
(vii) Additional Documents. At the Closing Time and on each other Primary Delivery Date and each Secondary
Delivery Date, the Sales Agent and counsel for the Sales Agent shall have been furnished with such additional documents and
opinions as they may reasonably require for the purpose of enabling such counsel to pass upon the issuance and sale of the
Shares as herein contemplated, or in order to evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings taken by the Company in connection with the
issuance and sale of the Shares as herein contemplated shall be reasonably satisfactory in form and substance to the Sales
Agent and counsel for the Sales Agent. For the avoidance ofdoubt, it is understood and agreed that the Sales Agent shall not
have any obligation to offer or sell ary Shares during the period commencing on any Primary Delivery Date or Secondary
Delivery Date, as the case may be, through the date on which all deliverables triggered by such Primary Delivery Date or
Secondary Delivery Date, as the case may be, have been satisfactorily delivered to the Sales Agent.
(viii) Additional Conditions for "Distributions ". If the Company shall direct the Sales Agent to offer and sell Shares in
a transaction that would constitute a "distribution" within the meaning of Rule 100 of Regulation M of the 1934 Act
Regulations, the Company will provide the Sales Agent (A) at the Sales Agent's request and upon reasonable advance notice
to the Company, on or prior to the Settlement Date in respect of such sale, the opinions of counsel and offtcers' certificates
pursuant to Sections 6(a)(ii), (iii) and (iv) hereof, each dated such Settlement Date, (B) at the Sales Agent's request and upon
reasonable advance notice to the Company, on or prior to the Settlement Date in respect of such sale, a customary
"bringdown" comfort letter from Deloitte & Touche LLP and (C) such other documents and information as the Sales Agent
shall reasonably request.
(b) Tbrmination of Agreement.If any condition specified in this Section shall not have been fulfilled when and as required to
be fulfilled and shall not be waived by the Sales Agent, this Agreement may be terminated by the Sales Agent by notice to the
Company, and such termination shall be without liability of any party to any other party, except as provided in Section 5 and except
that Sections 2,7,8 and 9 shall survive any such termination and remain in full force and effect.
( c ) lnctease of Maximum Number. The Company may at any time increase the Maximum Number to any number by
delivering to the Sales Agent:
(D a notice executed by the hesident or a Senior Vice President of &e Company stating that the Maximum Number
shall be increased to the number specified in such notice;
(iD a certificate signed by the individuals specified in Section 6(a)(iv) to the effect that the representations and
warranties in Section 2(aXx) and 2(a)(xvii) are ffue and correct with respect to the Maximum Number as to be increased;
(iiD a certificate signed by the individuals and to the effect specified in Section 6(a)(iv), with the proposed Maximum
Number being substituted for the existing Maximum Number;
(iv) opinions of counsel for the Company, as specified in Section 6(a)(ii), reflecting the Maximum Number as to be
increased;
(v) a revised Prospectus reflecting the Maximum Number as to be increased; and
(vi) such additional documents as shall be reasonably required by ttre Sales Agent and counsel for the Sales Agent for
purposes analogous to those specified in Section 6(aXvi).
Upon the satisfaction of the foregoing conditions, the Maximum Number shall be increased as specified, without further act, for all
purposes of this Agreement.
SECTION 7. Indemnification.
( a ) Indemnification of the Sales Agent. The Company shall indemniff and hold harrnless the Sales Agent, its affiliates,
directors and officers and each person, if any, who controls the Sales Agent, within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, (A) arising outof any untrue
stratement or alleged untrue statement of a material fact contained in the Regishation Statement (or any amendment thereto), or
the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements
therein not misleading or (B) arising out of any untrue statement or alleged untrue statement of a material fact contained in any
Issuer Free Writing Prospectus, the Disclosure Package or the Prospectus (or any amendment or supplement thereto) or tlre
omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of ttre
circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental a1ency or body,
commenced or tlreatened, or of any claim whatsoever based upon any untrue statement or omission of a material fact, or any
alleged untrue statement or omission of a material fact, in either case of the nature described in clause (i) above; provided that
any such settlement is effected with the written consent of the Company; and
(iiD against any and all expense whatsoever, as incurred (including the fees and disbursements of counsel chosen by
the Sales Agent), reasonably incurred in investigating,
preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such unffue statement or omission, or any such alleged
unkue statement or omission, to the extent that any such expense is not paid under (i) or (ii) above;
provided, however, that this Section 7 shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with written information
furnished to the Company by the Sales Agent expressly for use in the Registration Statement (or any amendment thereto), any Issuer
Free Writing Prospectus, the Disclosure Package or the Prospectus (or any amendment or supplement thereto).
( b ) Indemnification of the Company. The Sales Agent shall indemnifr and hold harmless the Company, its directors and
officers, and each person, if any, who controls the Company within the meaning of Section l5 of the 1933 Act or Section 20 of the
l934Actagainstany and all loss, liability, claim, damage and expense described in subsection (a) of this Section, as incurred, butonly
with respect to untrue statements or omissions of a material fact, or alleged untrue statements or omissions of a material fact, made in
the Regiskation Statement (or any amendment thereto) or any Issuer Free Writing Prospectus, the Disclosure Package or the Prospectus
(or any amendment or supplcment thereto) in reliance upon and in conformity wittr written information furnished to the Company by
the Sales Agent expressly for use therein.
(c) Actions against Parties; NotiJication. Each indemnified party shall give notice as promptly as reasonably practicable to
each indemni$ring party of any action commenced against it in respect of which indemnity may be sought hereunder, but failure to so
notiff an indemniffing party shall not relieve such indemni$,ing party from any liability hereunder to the extent it is not materially
prejudiced as a result thereof and in any event shall not relieve it from any liability which it may have otherwise than on account of this
Section 7. In the case of parties indemnified pursuant to Section 7(a), counsel to the indemnified parties shall be selected by the Sales
Agent, and, in the case of parties indemnified pursuant to Section 7(b), counsel to the indemnified parties shall be selected by the
Company. An indemniffing party may participate at its own expense in the defense of any such action; provided, however, that counsel
to the indemniffing party shall not (except with the consent of ttre indemnifred party) also be counsel to the indemnified party. In no
event shall the indemni$ing parties be liable for fees and expenses of more than one counsel (in addition to any local counsel) separate
from their own counsel for all indemnified parties in connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances. No indemniffing party shall, without the prior written
consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect to any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever in respect of
which indemnification could be sought under this Section 7 or contribution could be sought under Section 8 hereof (whether or not the
indemnified parties are actual or potential parties thereto), unless such settlement, compromise or consent (i) includes an unconditional
release of each indemnified party from all liability arising out of such litigation, investigation, proceeding or claim and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.
SECTION8. Contribution.
If the indemnification provided for in Section 7 hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or expenses referred to therein, then each indemniSing party
shall contribute to the aggregate amount of such losses, liabilities, claims, damages and expenses incurred by such indemnified party,
(i) in such proportion
as is appropriate to reflect the relative benefits received by the Company on the one hand and the Sales Agent on the other hand from
the offering of the Shares pursuant to this Agreement or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the
Company on the one hand and of the Sales Agent on the other hand in connection with the statements or omissions which resulted in
such losses, liabilities, claims, damages or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and ttre Sales Agent on the other hand in connection with the
offering of the Shares pursuant to this Agreement shall be deemed to be in the same respective proportions as the total net proceeds
from the offering of the Shares pursuant to this Agreement (after the Sales Agent's commission or discoun! but before expenses)
received by the Company and the total commissions and/or discounts received by the Sales Agent, bear to the aggregate public offering
price ofthe Shares.
The relative fault of the Company on the one hand and the Sales Agent on the other hand shall be determined by reference to,
among other things, whether any such untrue or alleged untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company or by the Sales Agent and the parties'relative intent, knowledge, access to
information and opporfunity to correct or prevent such statement or omission.
The Company and ttre Sales Agent agree that it would not be just and equitable if contribution pursuant to this Section 8 were
determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations
referred to above in this Section 8. The aggregate amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 8 shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in investigating, preparing or defending against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such unffue or alleged untrue
statement of a material fact or omission or alleged omission of a material fact.
Notwithstanding the provisions of this Section 8, the Sales Agent shall not be required to contribute any amount in excess of
the amount by which the total amount in respect of commissions or underwriting discounts received by the Sales Agent pursuant to this
Agreement exceeds the amount of any damages which the Sales Agent has otherwise been required to pay by reason of any such
unfue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of Section ll(0 of the 1933 Act) with respect to the
offering of Shares pursuant to this Agreement shall be entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.
Forpurposes of this Section 8, each affrliate, directorand officerof *re SalesAgentand eachperson, if any, who conffols the
Sales Agent within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same righS to contribution
as the Sales Agent, and each director of the Company, each officer of the Company, and each person, if any, who conffols the
Company within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to contribution as
the Company.
23
SECTION 9. Reoresentations. Warranties and Agreements to Survive.
All of the respective representations, warranties and agreements of the Company and the Sales Agent contained in this
Agreement, or in certificates of officers of the Company delivered pursuant to this Agreement, shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of the Sales Agent or controlling person of the Sales Agent, or by or on
behalf of the Company, or any director, officer or controlling person of the Company, and shall survive delivery of and payment for the
Shares.
SECTION 10. Termination of Agreement.
(a) Termination by the Sales Agent. T\e Sales Agent may terminate this Agreement, at any time
(D if there has been since the date of the latest audited balance sheet included in the Registration Statement and the
Prospectus any Material Adverse Change, or
(ii) bankruptcy, insolvency, reorganization, or liquidation proceedings or other proceedings for relief under any other
law for the relief of debtors shall have been instituted by or against the Company or any Designated Subsidiary, or
(iii) the Company or any Designated Subsidiary shall have made an assignment for the benefit of creditors or shall
have applied to the appointnent of a receiver or trustee for such entity or for all or substantially all of its property or business, or
such a receiver or trustee shall otherwise have been appointed, or
(iv) the Common Stock shall no longer be listed on the NYSE, or
(v) if there has occurred any material adverse change in the financial markets in the United States or in the
international financial markets, any outbreak of hostilities or escalation thereof or other calamity or crisis or any change or
development involving a prospective change in national or international political, financial or economic conditions, in each case
the effect of which is such as to make it, in the judgment of the Sales Agent, impracticable or inadvisable to offer, sell or deliver
the Shares or to enforce conhacts for the sale ofthe Shares, or
(vi) if trading in the Common Stock has been suspended or materially limited by the Commission or the New York
Stock Exchange, or if trading generally on the New York Stock Exchange or the NYSE MKT. or in the NASDAQ Global
Market or the NASDAQ Global Select Market has been suspended or materially limited, or minimum or maximum prices for
trading have been fxed, or maximum ranges for prices have been required, by either of such exchanges or Nasdaq Stock
Market, Inc. with respect to such markets or by order of the Commission or any other govemmental authority, or
(vii) a material disruption has occurred in commercial banking or securities settlement or clearance services in the
United States, or
(viii) if a banking moratorium has been declared by either federal or New York authorities.
The Sales Agent may terminate this Agreement for any other reason, upon ten days' advance notice to the Company.
24
(b) Termination by the Company. The Company may terminate this Agreement at any time, upon one Trading Day's advance
notice to the Sales Agent.
(c) Liabilities.If this Agreement is terminated pursuant to this Section, such termination shall be wittrout liability of any party
to any other party except as provided in Section 5 hereof; andprovided, further that Sections 2,7,8 and 9 shall survive such
termination and remain in full force and effect.
SECTION I l. Notices.
(a) General. Except as hereinafter provided, all notices, requests and other communications hereunder shall be in writing and
shall be deemed to have been duly given if received by mail, electronic mail or transmitted by any standard form of telecommunication
to the addresses set forth in this section or to such other address as such party shall have specified most recently by written notice.
Notices to the Sales Agent shall be directed to it at Merrill Lynch, Pierce, Fenner & Smith Incorporated, One Bryant Park, New York,
NewYork 10036, attention: Thomas J. Opladen, Jr., Equity Financial Products, ECM, Fax No. (al5) 835-2514, with a copy (which
shall not constitute notice) to: Choate, Hall & Stewart LLP, Two Intemational Place, Boston, MA 02110, attention: Andrew J. Hickey,
Esq., Fax No. [phone]; and notices to the Company shall be directed to it at l4l I East Mission Avenue, Spokane, Washington
99202, attention: Treasurer, Fax No. [phone], e-mail: [e-mail].
( b ) Sales Notice; Confirmation and Settlement of Sales; Suspension of Sales. All Sales Notices shall be executed by an
individual named on Schedule A hereto who is the President a Senior Vice President, a Vice President, the Tieasurer or an Assistant
Treasurer of the Company, and shall be delivered to any of the personnel of the Sales Agent listed on Schedule A hereto. Any
comments by the Sales Agent on any Sales Notice shall be delivered to any of the personnel of the Company listed on Schedule A
hereto. All notices and other correspondence to and from the Company and the Sales Agent with respect to the confirmation and
settlement of sales of Shares or suspension of sales of Shares shall be delivered to the personnel of the Company and the Sales Agent
listed on Schedule A hereto. Eittrer party may update its personnel listed on Schedule A by written notice to the otlrer party.
SECTION 12. Parties in Interest.
This Agreement shall inure to the benefit of and be binding upon the Sales Agent and the Company and their respective
successors. Nothing expressed in this Agreement is intended or shall be construed to give any person, firm or corporation, other than
the Sales Agent and the Company and their respective successors and the controlling persons and officers and directors referred to in
Sections 7 and 8 and their heirs and legal representatives, any legal or equitable right, remedy or claim under or in respect of this
Agreement or any provision herein contained. This Agreement and all conditions and provisions hereof are intended to be for the sole
and exclusive benefit of the Sales Agent and the Company and their respective successors, and said controlling persons and officers
and directors and their heirs and legal representatives, and for the benefit of no other person, firm or corporation. No purchaser oI
Shares from the Sales Agent shall be deemed to be a successor by reason merely of such purchase.
SECTION 13. No Advisory or Fiduciary Relationship.
The Company acknowledges and agrees that (a) the offering and sale of the Shares pursuant to this Agreement including the
determination of the public oflering price of the Shares and any related commissions and discounts, is an arm's-length commercial
transaction between the Company, on the one hand, and the Sales Agent, on the other hand, (b) in connection with the offering
contemplated hereby and the process leading to such transaction, the Sales Agent is and has been acting solely on its own behalf and
is not the agent or fiduciary of the Company, or its shareholders, creditors, employees or any other party, (c) the Sales Agent has not
assumed and will not assume an advisory or fiduciary responsibility in favor of the Company with respect to the offering contemplated
hereby or the process leading thereto (irrespective of whether the Sales Agent has advised or is currently advising the Company on
other matters) and the Sales Agent has no obligation to the Company with respect to the offering contemplated hereby except the
obligations expressly set forth in this Agreement, (d) the Sales Agent and its affiliates may be engaged in, and may in the future engage
in, a broad range of transactions that involve interests that differ from those of the Company and (e) the Sales Agent has not provided
any legal, accounting, regulatory or tax advice with respect to the offering contemplated hereby, and the Company has consulted its
own legal, accounting, regulatory and tax advisors to the extent it deemed appropriate.
SECTION 14. Goveming Law and Time.
This agreement and any claim, controversy or dispute relating to or arising out of this Agreement shall be governed by
and construed in accordance with the internal laws of the State of New York applicable to agreements made and to be performed
within the State of New York without giving effect to principles of conflicts of laws thereof . Specified times of day refer to New
York City time. Any action, suit or proceeding to enforce any provision of, or based on any matter arising out of or in connection with,
this Agreement or the transactions contemplated hereby shall be brought in any federal court located in the Southem District of the State
of New York or any New York state court located in the Borough of Manhattan, and the Company agrees to the exclusive jurisdiction
of such courts (and of the appropriate appellate courts ttrerefrom), and each party waives (to the full extent permitted by law) any
objection it may have to the laying of venue of any such suit, action or proceeding in any such court or that any such suit, action or
proceeding has been brought in an inconvenient forum.
SECTION 15. Waiver of Jurv Trial.
The Company and the Sales Agent each hereby irrevocably waives any right it may have to a trial by jury in respect of any
claim based upon or arising out of this Agreement or any transaction contemplated hereby.
SECTION 16. Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all such counterparts
shall together constitute one and the same agreement.
SECTION 17. Entire Agreement.
This Agreement supersedes all prior and contemporaneous agreements and understandings (whether written or oral) between
the Company and the Sales Agent with respect to the subject matter of this Agreement.
SECTION 18. Effect of Headings.
The Section headings herein and the Table ofContents are for convenience only and shall not affect the construction hereof.
SECTION 19. No Assignment.
No party may assign its righs or delegate its duties or obligations under this Agreement without the consent of the other party.
Any purported assignment or delegation of rights, duties or obligations
26
hereunder shall be void and of no effect. Notrvithstanding the foregoing, the Sales Agent may assign its rights under this Agreement
and/or may delegate some or all of irc duties and obligations under this Agreemen! without the consent of the Company, to an affiliate
of the Sales Agent that is a registered broker-dealer, it being understood that no such assignment or delegation shall release the Sales
Agent from any of its obligations hereunder. This Agreement shall each inure to the benefit of and be binding upon BofAML Securities,
Inc. as an assignee to the Sales Agent without prior written consent of any party.
SECTION 20. Severabilitv.
This Agreement and each Terms Agreement shall be deemed severable, and the invalidity or unenforceability of any term or
provision hereof or thereof shall not affect the validity or enforceability hereof or thereof or of any term or provision hereof or thereof.
Fufihermore, if any term or provision of this Agreement or any Terms Agreement is determined to be invalid or unenforceable, there
shall be deemed to be made to such term or provision such minor changes (and only such minor changes) as shall be necessary to make
it valid and enforceable.
If the foregoing is in accordance with your understanding of our agreemen! please sign and return to the Company a
counterpart hereof, whereupon this instrument along with all counterparts, will become a binding agreement between the Sales Agent
and the Company in accordance with its temrs.
Vcry truly youn,
AVISTACORPORATION
By: /s/Mad<T.Thies
Name: Mark T. Thies
Title: SeniorVicePresident,
Chief Financial Offi ccr and
Treasurpr
Signature Page to Sales Agency Agreement
CONFIRMED AND ACCEPTED,
as ofthe date first above written
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
/s/ Michael Dunne
Name: Michael Dunne
Title: Managing DrEctor
Signature Page to Sales Agency Agreement
SCHEDULE A
Contact Persons
The Comoanv
Mark T. Thies
Senior Vice President Chief Financial Offrcer and Treasurer
Mark.Thies@avi stacorp.com
T:509495-4639
Ryan L. Krasselt
Vice President, Controller and Principal Accounting Officer
Ryan. Krasselt@avistacorp. com
T:509495-2273
Don M. Falkner
Assistant Treasurer
[e-mail]
T:509-495-4326
Richard N. Stevens
Assistant Treasurer and Director of Finance
[e-mail]
T: 509-495-4330
Lauren Pendergraft
Senior Treasury Analyst
Lauren. Pendergraft @avistacorp. com
T: 509-495-2998
Solely for notices and other correspondence to the Company with respect to the conlirmetion and settlement of sales of
Shares, please include:
Denise Burns
Cash Management Analyst
[e-mail]
T:509-495-4725
Treasury Deparknent
[e-mail]
The Sales Agent
Thomas J. Opladen, Jr.
Vice President
Thomas [e-mail]
T: 646-855-8900
F:415-835-2514
Schedule A-l
EXHIBIT A
SALES NOTICE
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
One Bryant Park
NewYo*,NY 10036
Attention: Thomas J. Opladen, Jr.
Tel. No. [phone]
Fax No.: [phone]
E-Mail: Thomas.i.ooladen irt2baml.com
Reference is made to the Sales Agency Agreement between Avista Corporation (the "Company") and Merrill Lynch, Pierce, Fenner & Smith
Incorporated, dated as of March 2, 2016 (capitalized terms herein having the meanings assigned thereto in such Agreement). The Company confirms
that all conditions to the delivery of this Sales Notice are satisfied as of the date hereof. As of the date hereof, neither the Prospectus nor the
Disclosure Package contains an untrue statement of a material fact or omits to state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading.
First date of Selling Period:
Last date of Selling Period:
Number of days in Selling Period:
Settlement Dat{s):
Number of Shares:
Floor Price+:
Company Bank Account
Third Trading Day after each sale
per share
*The Floor Price shown above shall be applicable to any Shares to be sold during such Selling Period. Such Floor Price may be adjusted by the
Company during such Selling Poiod. Notwithstanding the foregoing, in no event shall the Sales Price for any Shares be less than $_ below
the last sale price at which the Company's Common Stock was quoted on the record of composite transactions reported by The Wall Street
Journal on the Trading Day immediately preceding the day for fixing the price ofsuch Shares.
Additional Restrictions:
Comments:
AVISTA CORPORATION
By:
Name:
rTitle:
I To be executed by the President, any Vice President, the Treasurer or any Assistant Treasurer of the Company.
$
$
Exhibit A-l
Filed pursuant to Rule 424(b)(5)
Registration No. 333 -2097 I 4
A registration fee of S9,l 05.t 7, calculated in accordance with Rule 457(r), has been transmitted to the Securities and Exchange Commission with
respect to the sharcs ofcommon stock offered by this prospectus supplement and the accompanying prospectus. The proposed maximum aggregate offering
price hasbeen calculated by multiplying 3,795,199 sharesby $37.815 pershare,the average ofthe high and lowprices ofourcommon stock on February 29,
2016, as reported in the consolidated reporting system. The amount ofthe registration fee paid with rcspect to such shares has been offset and reduccd by
$5,346.84, representing the portion ofthe $8,1 20.3 I registration fee paid in connection with the filing ofprospectus supplement dated August 9, 20 I 2 that is
associated with the I ,795,199 shares remaining unsold out ofth e 2,726,390 additional shares offered by that prospectus supplement. This paragraph shall be
deemed to update the "Calculation ofRegistration Fee" table in the registration statement referred to above.
PROSPECTUS SUPPLEMENT
(To Prospectus dated February 25,2016)
3,795,199 Shares
AVISTA CORPORATION
Common Stock
We may offer and sell up to 3,795,199 shares of our common stock fiom time to time through the sales agents named below.
We may offcr and scll shares ofour common stock through one or more ofthe salcs agcnts namcd in this prospcctus supplement, over a period oftime
and from time to time in transactions at the market prices prevailing at the time of sale, pursuant to the applicable sales agency agreement. We will pay each
ofthe sales agents a commission not to exceed 2Yooftbe gross sales price pershare ofall shares sold through it as agent underthe applicable sales agency
agreement, except as otherwise provided in the sales agency agrcement. None ofthe sales agents is required to sell any specific number or dollar amount of
shares of our common stock but each has agreed to use its reasonable efforts, as our sales agent and on the terms and subject to the conditions of the
applicable salcs agency agrccmcnt, to sell the shares offered on terms agreed upon by such salcs agent and us. The shares ofcommon stock will be offered and
sold through only one sales agent on any given day. See "Plan ofDistribution" in this prospectus supplement for further information.
Our common stock is listed on the New York Stock Exchange under the symbol "AVA." The reported last sale price of our common stock on March l,
20 I 6, as reported in the consolidated reporting system, was $37.82 per share.
See "Risk Factorc't heginning on page S-3 lor reference to cerlainfactors you should consider hefore buying our common stock.
Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved ofthese securities or passed upon
the accuracy or adequacy ofthis prospectus supplement or the accompanying prospectus. Any representation to the contrary is a criminal offense.
BNY Mellon Capital Markets, LLC
BofA Merrill Lynch
Credit Suisse
The date of this prospectus supplement is March 2, 2016
J.P. Morgan
Risk Factors
Safe Harbor For Forward-Looking Statements
The Company
Plan of Distribution
General
Conflict of Interest
Legal Matten
About this Prospectus
Risk Facton
Avista Corporation
Use ofProceeds
Description of the Bonds
Description of the Notes
Description of Prefened Stock
Description of Common Stock
Where You Can Find More Information
Legal Matters
Experts
TABLE OFCONTENTS
Prospectus Supplement
Prospectus
3
4
5
5
5
6
6
2
J
3
4
4
12
2r
23
26
27
27
We have not authorized anyone to give you any information other than this prospectus supplement and tle accompanying prospectus. You should
assume that the information contained or incorporated in this prospectus supplement and the accompanying prospectus is accurate only as ofthe respective
dates ofthese documents. We are not offering to sell these securities and we are not soliciting offers to buy these securities in any jurisdiction in which offers
are not pennitted.
RISK FACTORS
General
Investing in common stock involves risk. You should review all the information contained or incorporated by reference in this prospecrus supplement
and the accompanying prospectus before deciding to invest. See "Where You Can Find More Information" in the accompanying prospectus. In particular,
you should carefully consider the risks and uncertainties discussed in "Risk Factors", "Forward-Looking Statements" and "Management's Discussion and
Analysis ofFinancial Condition and Results ofOperations" in our annual r€port on Form l0-K and quarterly reports on Form l0Q filed with the Securities
and Exchange Commission (the "SEC") and incorporated herein by reference.
Risks Related to an Investment in Avista Common Stock
The market price of our common stock Iluctuates continuously.
Our common stock is listed on the New York Stock Exchange and is traded on that exchange and elsewhere. The market price fluctuates continuously.
The fluctuation in the market price ofour common stock is caused by a variety offactors, most ofwhich are beyond our control. These facton include,
but are not limited to:
. any and all factors that affect the U.S. and global financial markets gcnerally including, but not limited to, gcneral U.S. and global economic
conditions;
. events or circumstances relating to us, particularly those related to the risk factors discussed in our periodic reports filed with the SEC;
. periodic variations in our operating results, the perceived value of our assets or our business prospects, or the perceptions or expectations of
investors or securities analysts as to such variations;
. periodic developments in, or changes in the prospects for, the electric and natural gas utility industries, or the perceptions or expcctations of
investors or securities analysts as to such developments or changes;
. our ability to continue to pay dividends or any change in the level ofdividends, or the perceptions or expectations ofinvestors or securities
analysts as to dividends; and
. furure sales by us of equity and other securities.
Any reduction, interruption or eliminetion ofthe quarterly dividend on our common stock would likely have an adverse efrect on the market price
of our common stock.
The payment ofdividends on our corlmon stock is solely u/ithin the discretion ofour Board ofDirectors (the "Board"). The Board considers the level of
dividends on a regular basis, taking into account numerous factors including, without limitation
. ourresults ofoperation, cash flows and financial condition;
. the succcss ofourbusiness strategies; and
' general economic and competitive conditions.
s-3
Our credit facilities have financial covenants that limit the percentage ofdebt in relation to our overall capital structure. These could have the effect of
restricting our ability to pay dividends. We are currently in compliance
with these provisions. In addition, the terms of our preferred stock contained in our a(icles of incorporation prohibit the payment of dividends on our
common stock unless all accumulated dividends on preferred stock havc been paid.There are currcntly no shares ofpreferred stock outstanding.We may
agree to similar, or more stringent, financial covenants or provisions in credit or other agreements in the future, and we may issue prefened stock in the future.
The market price ofour commotr stock could be adversely alfected by future sales ofour common stock
Except as described under "Plan ofDistribution" and except for required regulatory approvals, rve are not restricted fiom issuing additional shares of
common stock, whether in this offering or in any future o{Iering. We are also not restricted from issuing other securities that are convefiible into, or
exercisable for, or exchangeable for, shares ofour common stock. The market price ofour common stock could be adversely affected by sales ofsubstantial
amounts ofour common stock or any such otlrcr securities, or thc pcrccption that thcsc salcs may occur.
The shares ofour common stock ere structurally junior to all our other securities.
Ifwe were to be reorganized, liquidated or dissolved in a bankruptcy, insolvency or similar proceeding, holders ofdebt securities and other indebtedness,
including trade payables, and holders ofpreferred stock would receive distributions ofour available assets prior to holders ofour common stock. It is possible
that, after making such distributions, insufficient assets, or no assets at all, would remain available for distribution to holders ofour common stock.
Furthermore, we are likely to incur additional indebtedness and may issue shares ofpreferred stock in the future. The market price ofour common stock
could be adversely affected by the incurrence ofadditional indebtedness or the issuance ofprefened stock in substantial amounts.
SAFE HARBOR FOR FORWARDLOOKING STATEMENTS
From time to time, we make forwardJooking statements such as statements regarding projected or future financial performance, cash flows, capital
expenditures, dividends, capital structure, other financial items, strategic goals and objectives, and plans for operations. These statements are based upon
underlying assumptions (many ofwhich are based, in tum, upon further assumptions). These staternents arc rnade both in our reports filed under the Securities
Exchange Act of 1934, as amended, and elsewhere.ForwardJooking statements are all statements except those ofhistorical fact, including, without
limitation, those that are identified by the use of words such as, but not limited to, "will", "may", "could", "should", "intends", "plans", "seeks",
"anticipates", "estimates", "expects", "forecasts", "projects", "predicts", and similar expressions.
ForwardJooking statements are subject to a variety ofrisks and uncertainties and other facton. Most ofthese factors are beyond our control, and many of
thcm could have a significant effect on our operations, results of operations, financial condition or cash flows. This could causc actual results to differ
materially ffom those anticipated in our statements. Such risks, uncertainties and other factors include, among others, those listed or referred to under the
caption "Risk Factors" in this prospectus supplement.
Our expectations, beliefs and projections are expressed in good faith. We believe they are reasonable based on, among other considerations, an
cxamination ofhistorical operating trcnds, data contained in our records and other data available from third parties. However, there can bc no assurance that
ourexpectations,beliefs orprojectionswill be achieved oraccomplished. Furthermore, any forwardJooking statement speaks only as ofthe date on which
such statement is made. We undertake no obligation to update any forwardJooking staternent or statements to reflect events or circumstances that occur after
the date on which such statement is made orto reflect the occurence ofunanticipated events, except as required by law. Newrisks, uncertainties and other
factors emerge from time to time, and it is not possible forus to predict all such factors, norcan we assess the effect ofeach such factoron ourbusiness orthe
extent that any such factor or combination offactors may cause actual results to differ materially from those contained in any forward-looking statement.
s-4
THE COMPANY
Avista is primarily an electric and natural gas utility, u/ith ce(ain other business ventures. Our corporate headquarters are in Spokane, Washington. Our
utility operations provide electricity and natural gas in parts ofthe Pacific Northwest, and, through a subsidiary, in the City and Borough ofJuneau,Alaska.
For more information, see the accompanying prospectus and the documcnts incorporated herein by rcfcrcnce.
PLANOF DISTRIBTJTION
General
Avista has entered into separate, but substantially identical, sales agency agreements with BI{Y Mellon Capital Markets, LLC, Credit Suisse Securities
(USA) LLC, J.P. Morgan Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as our sales agents, under which we may issue and sell
sharcs ofAvista Common Stock.
The sales, ifany, ofthe shares ofAvista Common Stock under the sales agency agreement with each sales agent will be made in "at the market offerings"
as defined in Rule 415 ofthe SecuritiesAct of 1933, including sales made directly on the New York Stock Exchange, the principal existing trading market
for Avista Common Stock, through an "altemative trading system" as defined in Regulation ATS under the Exchange Act of I 934 or any other electronic
communications network, or to or through a market maker. In addition, shares of Avista Common Stock may be offered and sold by such other methods,
including privately negotiated transactions, as we and any sales agent agree to in *riting. From time to time during the term ofthe sales agency agreement
with each sales agent, and subject to the terms and conditions set forth therein, we may deliver a sales notice to that sales agent specifuing:
. the length ofthe selling period, which may not exceed 20 trading days; and
. the minimum price below which sales may not be made.
We will submit orden to only one sales agent relating to the sale of Avista Common Stock on any given day.
Upon receipt ofa sales notice from Avista, and subject to the terms and conditions ofthe applicable sales agency agreement, each sales agent has agreed
to use its commcrcially reasonablc efforts, consistent with its normal trading and sales practiccs, to sell, during the sclling period specified in that salcs
notice, the number ofshares we speciff in that notice and on the terms specified in that notice. We or the applicable sales agent may suspend the offering of
shares ofAvista Common Stock by that sales agent at any time upon proper notice to the other, and the selling period will immediately terminate. The
settlement between us and a purchaserofshares ofAvista Common Stock will occuron the third trading day following the date on which the sale was made.
The obligation of each sales agent under the applicable sales agency agreement to sell shares pursuant to any sales notice is subject to a number of
conditions, which each salcs agent reservcs thc right to waive in its solc discretion.
We will pay each sales agent a commission, which shall not exceed 2%o of the gross sales price per share of all shares sold through it as agent under the
applicable sales agency agreement, except as may otherwise be agreed upon between us and a sales agent with respect to certain transactions. We have also
agreed to reimburse each sales agent for certain ofits reasonable documented out-of-pocket expenses, including certain fees and disbursements ofcounsel, in
connection with cntcring into thc applicablc salcs agency agreement and performing its obligations thcrcunder.
Avista Common Stock is an "actively-traded security" excepted from the requirements ofRule l0l ofRegulation M underthe ExchangeAct by
Rule I 0l (c)(1) of Regulation M. If either we or a Sales Agent has reason to believe that Avista Common Stock is not such an excepted security, that party will
promptly notifr the other and sales ofAvista Common Stock under that sales agency agreement may be suspended until, in the judgment ofeach party,
Avista Common Stock is such an excepted security
In connection with the sales ofAvista Common Stock as contemplated in this prospectus supplement, each sales agent may be deemed to be an
"under*riter'' within thc meaning ofthe Securitics Act of 1 933, and the
s-5
compensation paid to each sales agent may be deemed to be underwriting commissions or discounts. We have agreed to indemnifu each sales agent against
certain civil liabilities, including liabilities underthe Securities Act of I 933.
Sales ofAvista Common Stock as contemplated herein will be settled through the facilities of The Depository Trust Company orby such othermeans as
wc and thc applicable sales agent may agrce upon.
The initial expenses ofthis offering are estimated at approximately $200,000 and are payable by us.
The offering ofshares ofAvista Common Stock pursuant to any sales agency agreement will terminate upon the earliest of(l ) the first date on which the
Maximum Numbers ofshares ofour common stock have been sold pursuant to the sales agency agreements (2) the termination ofthat sales agency agreement
by us or the sales agent under that agreement and (3) February 29, 2020. The termination ofone ofthe sales agency agreements by either us or the sales agent
under that agreement, as contemplated in clause (2) above, will not, in and ofitself, result in the termination ofany other sales agency agreement. The
"Maximum Number" ofshares is 3,795,1 99 or such higher number as may bc cstablished pursuant to the salcs agency agreements.
We have agreed under each sales agency agreement not to directly or indirectly offerto sell, contract to sell, sell, grant any option to buy orotherwise
dispose of, shares ofAvista Common Stock or securities convertible into or exchangeable for shares ofAvista Common Stock, warrants or any rights to
purchase or acquire Avista Common Stock (i) during a selling period specified in a sales notice to the sales agent under that agreement without the prior
written conscnt ofthat salcs agent and (ii) at any time during thc term ofsuch agreement without giving at least three trading days'priornotice to that sales
agent. The particular sales agent may give this consent at any time without public notice. The restriction described in this paragraph does not apply to sales
of:
shares pursuant to the applicable sales agency agreement or the other sales agency agreements,
shares, options to purchase shares or shares issuable upon the exercise ofoptions, in any case pursuant to any employee or director stock option or
benefit plan, any stock purchase or ownership plan or any dividend r€investment and stock purchase plan;
shares issuable upon conversion ofsecurities or the exercise ofwarrants, options or other rights disclosed in the documents incorporated by
reference; or
. shares issuable as consideration in connection with acquisitions ofbusiness, assets or securities ofother entities by merger or otherwise.
The sales agents and their affiliates have provided, and may in the future provide, investment banking, commercial banking, corporate trust services and
other services for us fiom time to time for which they have received, or may be entitled to receive, customary fees and reimbursement ofexpenses.
Conflict oflnterest
The sales agents or their respective affiliates are lenders under our revolving credit facility which we may repay from time to time, in whole or in part,
using the net proceeds ofsales ofcommon stock through the sales agents. As a consequence, the sales agents or their respective affiliates may receive more
than5Yoofthenetproceedsofthesesalesofcommonstockand,accordingly,maybedeemedtohaveaconflictofinterestunderFINRARule5l2l (Public
Offerings of Securities with Conflicts of Interest). In such case, and to the extent that FINRA Rule 5 I 2 I is applicable, the sales agents would conduct the
distribution ofthe shares in accordance with this rule and would not confirm sales to an account over which they exercise discretionary authority without first
receiving specific written approval from the account holder.
s-6
LEGALMATTD,RS
The legality of the shares offered hereby and certain other matters are passed upon forAvista by Marian M. Durkin, Esq., Senior Vice President, General
Counsel and Chief Compliance Officer of Avista, and Pillsbury Wnthrop Shaw Pittman LLI counsel to Avista. In giving its opinion, Pillsbury Winthrop
Shaw Pittman LLP may rely as to matters govemed by the Washington Business Corporation Act upon the opinion of Marian M. Durkin, Esq. Choate, Hall &
Stewart LLP, Boston, Massachusetts, is acting as counsel to the sales agents.
$.7
3,795,199 Shares
Avista Corporation
Common Stock
PROSPECTUS SUPPLEMENT
March 2,2016
BltY Mellon Capital Markets, LLL
BofA Merrill Lynch
Credit Suisse
J.P. Morgan