20200421Supplemental Information.pdf

1411 East Mission P.O. Box 3727
Spokane. Washington 99220-0500
Telephone [phone] ext. 8620
Fax No. 509-777-5259

April 21, 2020

Commission Secretary
Idaho Public Utilities Commission
11331 W. Chinden Blvd
Building 8, Suite 201-A
Boise, ID 83714
Via Email: [e-mail]

Re: CASE NO. AVU-U-20-01 - In the Matter of the Application of Avista Corporation for an
Order authorizing the offering, issuance and sale of Debt Securities not to exceed $500,000,000.
Avista Corporation’s Submission of Supplemental Information

Commission Secretary:

On March 19, 2020, the Commission issued Order No. 34604, approving Avista Corporation’s
proposed credit facility of up to $500,000,000 and with a term of up to five (5) years, with an
extension for up to two (2) additional years. Due to the recent impact of COVID-19 on the
financial markets, the current market conditions and current pricing are such that it is not
presently fiscally advantageous to commit to a long-term, five (5) year credit facility. Instead,
Avista now intends to amend, amend and restate, or replace the existing credit facility with a
shorter term of one (1) year, with an option to extend one (1) additional year, and subject to
different rates and fees than presented in the original application.

Avista believes it has sufficient authority under Order No. 34604 for its new plan and
understands from informal inquiries that the Commission’s staff agrees. However, Avista is
requesting a new order from the Oregon Public Utility Commission and filing new information
with (but not requesting further action by) the Washington Utilities and Transportation
Commission (“WUTC”). To keep all three commissions equally informed, and because the
Commission based Order. No. 34604 in part on a copy of the earlier WUTC application, attached
as Exhibit A is a copy of a letter and exhibit filed with the WUTC detailing Avista’s current plan.

Finally, given constraints from working at home, it is difficult to obtain an official notarized
verification. That said, I certify (or declare) under penalty of perjury under the laws of the State
of Idaho that the foregoing is true and correct.
Please direct any questions related to this updated information to Patrick Ehrbar at 509.495.8620 or at [e-mail].
RECEIVED
2020 April 21,PM3:30
IDAHO PUBLIC
UTILITIES COMMISSION

Sincerely,

/s/ David J. Meyer

David J. Meyer Vice President, Chief Counsel for Regulatory & Governmental Affairs

Enclosures
Avista Corp.
1411 East Mission Ave.
P.O. Box 3727
Spokane, WA 99220-0500
Telephone: [phone]
VIA: UTC Web Portal
April 21, 2020
Mark L. Johnson
Executive Director and Secretary
Washington Utilities & Transportation Commission
621 Woodland Square Loop SE
Lacey, WA 98503
Re: Docket U-200126 - Supplemental information regarding Avista Corporation’s Intended
Financing
Dear Mr. Johnson,
On March 26, 2020, the Commission issued Order No. 01 in the above-referenced docket,
affirming Avista Corporation’s compliance with the notice requirements of RCW 80.08.040 with
respect to a credit facility of up to $500,000,000 and with a term of up to five (5) years, and with
an extension for up to two (2) additional years. Due to the recent impact of COVID-19 on the
financial markets, the current market conditions and current pricing are such that it is not presently
fiscally advantageous to commit to a long term, five (5) year credit facility. Instead, Avista now
intends to amend, amend and restate, or replace the existing credit facility with a shorter term of
one (1) year, with an option to extend one (1) additional year, and subject to different rates and
fees than presented in the original application.
The purposes of the debt issuance, public interest in the proposed financing, and uses of the
proceeds remain unchanged from Avista’s original application filed in this docket on February
26, 2020. The terms of the financing also remain the same, except for the new, shorter term as
described, and the following new estimated fees and borrowing spreads based on Avista’s current
senior secured debt rating:
Exhibit A
Page 2 of 2
Pricing
Level
Facility Fee Eurodollar
Margin (1)
ABR Margin
(2)
LC Participation Fee
I 0.125% 0.875% 0.000% 0.875%
II 0.150% 0.975% 0.000% 0.975%
III 0.175% 1.075% 0.000% 1.075%
IV 0.225% 1.150% 0.000% 1.150%
V 0.250% 1.250% 0.000% 1.250%
VI 0.300% 1.450% 0.000% 1.450%
1 Eurodollar Margin applies for borrowings with a term of at least two weeks. The rate will be the applicable LIBOR
rate plus the Eurodollar Margin.
2 Alternate Base Rate Margin applies for borrowings of less than two weeks. The rate is reset daily to whichever is
the greatest of (a) Prime Rate, (b) the Federal Funds Rate plus the Base Rate Margin, (c) 30 day LIBOR rate plus
1.00%.
Pricing has been impacted by the COVID-19 pandemic. Please see Exhibit A for existing facility
pricing and current market pricing information.
This letter contains the information required by RCW 80.08.040 with respect to Avista’s current
plan of financing. Avista is not requesting a new Commission order. The undersigned certifies
under penalty of perjury under the laws of the State of Washington that the foregoing is true and
correct to the best of my knowledge and belief, and that the proposed issuance of securities will
be used for the purposes allowed by Chapter 80.08 RCW.
Finally, given constraints from working at home, it is difficult to obtain an official notarized
verification. That said, I certify (or declare) under penalty of perjury under the laws of the State
of Washington that the foregoing is true and correct.
If you have any questions regarding this filing, please contact Patrick Ehrbar at [phone].
Sincerely,
/s/ David J. Meyer
David J. Meyer
Vice President, Chief Counsel for Regulatory
& Governmental Affairs
Enclosures
Exhibit A
1
Avista Corporation
Organizational Materials
April 2020
Exhibit A
2
LOAN MARKETS
Review of Existing Credit Facility & Proposed Terms
Summary Terms
Existing Proposed
Borrower Avista Corporation
Secured Ratings A- / A3
Facility Type Revolving Credit Revolving Credit
Security Secured Secured
Purpose General Corporate
Amount $400MM $400MM
Accordion $100MM $100MM
LC Sublimit $200MM $200MM
Extension Options Tw o, 1-year extension options or
One, 2-year option (60 days prior to Maturity) Tw o, 1-year extension options
Maturity April 18, 2021 April 18, 2022
Covenant Consolidated Debt / Cap < 65% Consolidated Debt / Cap < 65%
Upfront Fees 10.0 bps (2-year Extension) 10.0 bps “old money”
20.0 bps “new money”
Arranger Fees 2014: $150K / 2016: $75K $275K to MUFG
Pricing Grids
Secured Ratings (bps)
LIBOR
Spread
(L+bps)
-
Spread
(L+bps) (bps)
LIBOR
Spread
(L+bps)
-
Spread
(L+bps)
> A+ / A1 7.5 67.5 75.0 12.5 87.5 100.0
A / A2 10.0 77.5 87.5 15.0 97.5 112.5
A- / A3 12.5 87.5 100.0 17.5 107.5 125.0
BBB+ / Baa1 17.5 95.0 112.5 22.5 115.0 137.5
BBB / Baa2 20.0 105.0 125.0 25.0 125.0 150.0
< BBB- / Baa3 25.0 125.0 150.0 30.0 145.0 175.0
•The vintage 2011 credit
agreement will need to be
updated to include standard
market provisions:
–Libor Replacement
–EU Bail-in provision
–Beneficial Ow nershipprovision
–Updated sanctions language
•Rationalize fronting commitments
from $100MM to $50MM for each
JLA
Exhibit A
3
Disclaimer
The information herein provided is for information purposes only, and is not to be used or considered as investment research, a proposal or the solicitation of an offer to sell or to buy or subscribe for securities or other financial instruments. Neither this nor any other communication prepared by MUFG Bank, Ltd. (“MUFG Bank”), MUFG Union
Bank, N.A. (“MUB”), MUFG Securities Americas Inc., or other MUFG group companies (collectively, "MUFG") is or should be construed as investment advice, a recommendation or proposal to enter into a particular transaction or
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Certain information contained in this presentation has been obtained or derived from third party sources and such
information is believed to be correct and reliable but has not been independently verified. While MUFG believes that factual statements herein and any assumptions on which information herein are based, are in each case accurate, MUFG makes no representation or warranty regarding such accuracy and shall not be responsible for any inaccuracy in such statements or assumptions. Note that MUFG may have issued, and may in the future issue, other reports that are inconsistent with or that reach conclusions different from the information set forth herein. Such other reports, if any, reflect the different assumptions, views and/or analytical methods of the analysts who prepared them, and MUFG is under no obligation to ensure that such other reports are brought to your attention. Furthermore, the information may not be current due to, among other things, changes in the financial markets or economic environment and MUFG has no obligation to update any such information contained in this presentation. This presentation is not intended to
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This indicative financing proposal is provided for discussion purposes only and does not constitute, nor should it be construed as, a commitment to provide any financing or any assurance that the financing described herein may be available. The terms and conditions of such financing must be fully negotiated and contained in definitive documentation duly authorized, executed and delivered by all parties. In addition, the delivery of a commitment would
be subject to, among other things, (i) MUFG Bank’s and/or MUB’s satisfaction with the results of its legal, technical, environmental and business due diligence, (ii) final internal approvals by MUFG Bank and/or MUB, (iii) no material adverse change in the financial condition or otherwise of the relevant parties, (iv) no material adverse change or disruption in the relevant financial markets and (v) other customary conditions, including then current market conditions. This indicative financing proposal is confidential and may not be disclosed or released to any other party without the prior written consent of MUFG Bank and/or MUB.
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Exhibit A