IDAHO POWER COMPANY
First Mortgage Bonds,
Secured Medium-Term Notes, Series D
Due From Nine Months to Thirty Years
From Date of Issue
Selling Agency Agreement
November 12, 2002
Wachovia Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Idaho Power Company, an Idaho corporation (the "Company"), confirms
its agreement with you with respect to the issue and sale by the Company of up
to $200,000,000 aggregate principal amount of its First Mortgage Bonds, Secured
Medium-Term Notes, Series D Due from Nine Months to Thirty Years from Date of
Issue (the "Notes"). The Notes will be issued under the Indenture of Mortgage
and Deed of Trust, dated as of October 1, 1937, between the Company and Deutsche
Bank Trust Company Americas, formerly known as Bankers Trust Company, (the
"Trustee") and R.G. Page (▇▇▇▇▇▇▇ ▇▇▇▇, successor individual trustee), as
trustees, as supplemented and amended by all indentures supplemental thereto
including the Thirty-sixth Supplemental Indenture relating to the Notes dated as
of October 1, 2001 (the "Supplemental Indenture"). The Indenture of Mortgage and
Deed of Trust as it has been and may be supplemented as of any specified date is
hereinafter referred to as the "Indenture". Unless otherwise specifically
provided for and set forth in a Pricing Supplement (as defined below), the Notes
will be issued in minimum denominations of $1,000 and in denominations exceeding
such amount by integral multiples of $1,000, will be issued only in fully
registered form and will have the interest rates, maturities and, if applicable,
other terms set forth in such Pricing Supplement. The Notes will be issued, and
the terms thereof established, in accordance with the Indenture and the
Medium-Term Notes Administrative Procedures attached hereto as Exhibit A, as
they may be amended from time to time (the "Procedures") (unless a Terms
Agreement (as defined in Section 2(b)) modifies or otherwise supersedes such
Procedures with respect to Notes issued pursuant to such Terms Agreement). The
Procedures may be amended only by written agreement of the Company and you after
notice to the Trustee. For the purposes of this Agreement, the term "Agent"
shall refer to you acting solely in the capacity as agent for the Company
pursuant to Section 2(a) and not as principal, the term "Purchaser" shall refer
to you acting solely as principal pursuant to Section 2(b) and not as agent, and
the term "you" shall refer to you whether at any time you are acting in both
such capacities or in either such capacity.
The Company has previously entered into a Selling Agency Agreement
dated October 1, 2001 with each of ABN AMRO Incorporated, Banc of America
Securities LLC, Banc One Capital Markets, Inc., BNY Capital Markets, Inc.,
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co., McDonald Investments Inc., U.S. Bancorp ▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc.
and ▇▇▇▇▇ Fargo Brokerage Services, LLC, as
agents (the "October 1, 2001 Selling Agency Agreement"), with respect to the
issue and sale by the Company of up to $200,000,000 aggregate principal amount
of the Notes. This Agreement is being entered into pursuant to Section 2(a) of
the October 1, 2001 Selling Agency Agreement.
1. Representations and Warranties. The Company represents and warrants
to, and agrees with, you as set forth below in this Section 1. Certain terms
used in this Section 1 are defined in paragraph (e) hereof.
(a) The Company meets the requirements for use of Form S-3 under the
Securities Act of 1933, as amended (the "Act") and has filed with the Securities
and Exchange Commission (the "Commission") a registration statement on such Form
(File Number 333-67748), including a basic prospectus, which has become
effective, for the registration under the Act of $200,000,000 aggregate amount
of its first mortgage bonds, serial preferred stock, without par value, and debt
securities (the "Securities"), including the Notes. Such registration statement,
as amended at the date of this Agreement, meets the requirements set forth in
Rule 415(a)(1)(ix) or (x) under the Act and complies in all other material
respects with said Rule. The Company has filed or will file with the Commission
pursuant to the applicable paragraph of Rule 424(b) under the Act a supplement
to the form of prospectus included in such registration statement relating to
the Notes and the plan of distribution thereof (the "Prospectus Supplement"). In
connection with the sale of Notes the Company proposes to file with the
Commission pursuant to the applicable paragraph of Rule 424(b) under the Act
further supplements to the Prospectus Supplement (each a "Pricing Supplement")
specifying the interest rates, maturity dates and, if appropriate, other similar
terms of the Notes sold pursuant hereto or the offering thereof.
(b) (i) As of the Execution Time and on the Effective Date, the
Registration Statement complied and (ii) on each date any supplement to the
Prospectus (as defined herein) relating to the Notes is filed with the
Commission, as of the date of a Terms Agreement and at the date of delivery by
the Company of any Notes sold hereunder (a "Closing Date"), the Prospectus, as
supplemented as of any such time, and the Indenture will comply in all material
respects with the applicable requirements of the Act, the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act") and the Securities Exchange Act of
1934, as amended (the "Exchange Act") and the respective rules thereunder; (iii)
as of the Execution Time and on the Effective Date, the Registration Statement,
as amended as of either such time, did not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein not misleading; (iv) on
each date any supplement to the Prospectus relating to the Notes is filed with
the Commission, as of the date of a Terms Agreement and on any Closing Date, the
Prospectus, as supplemented as of any such time, 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; and (v) on any Closing Date no stop order
suspending the effectiveness of the Registration Statement shall be in effect
nor shall there have been instituted or threatened any proceeding for such
purpose; provided, however, that the Company makes no representations or
warranties as to (i) that part of the Registration Statement which shall
constitute the Statements of Eligibility of the Trustees (Forms T-1 and T-2), or
amendments thereto, under the Trust Indenture Act or (ii) the information
contained in or omitted from the Registration Statement or the Prospectus (or
any supplement thereto) in reliance upon and in
2
conformity with information, if any, furnished in writing to the Company by you
specifically for inclusion in the Registration Statement or the Prospectus (or
any supplement thereto).
(c) As of the time any Notes are issued and sold hereunder, the
Indenture will constitute a legal, valid and binding instrument enforceable
against the Company in accordance with its terms and such Notes will have been
duly authorized, executed, authenticated and, when paid for by the purchasers
thereof, will constitute legal, valid and binding obligations of the Company
entitled to the benefits of the Indenture.
(d) As of the time any Notes are issued and sold, the issue and sale
of the Notes and the compliance by the Company with all of the provisions of the
Notes, the Indenture, and this Agreement, and the consummation of the
transactions herein and therein contemplated will not conflict with or result in
a breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company is a party or by which the Company
is bound or to which any of the property or assets of the Company is subject,
nor will such action result in any violation of the provisions of the Restated
Articles of Incorporation or By-laws of the Company or any statute or any order,
rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its properties; and no consent,
approval, authorization, order, registration or qualification of or with any
such court or governmental agency or body is required for the issue and sale of
the Notes or the consummation by the Company of the transactions contemplated by
this Agreement or the Indenture, except such orders as have been issued by the
Idaho Public Utilities Commission (which grants authority to sell the Notes
through September 14, 2003, the Public Utility Commission of Oregon and the
Public Service Commission of Wyoming and are in full force and effect, and such
as have been, or will have been prior to any Closing Date, obtained under the
Act and the Trust Indenture Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under state securities or
Blue Sky laws in connection with the sale and distribution of the Notes by the
Agent.
(e) The terms which follow, when used in this Agreement, shall have
the meanings indicated. The term "the Effective Date" shall mean each date that
the Registration Statement and any post-effective amendment or amendments
thereto became or become effective and each date after the date hereof on which
the Company's most recent Annual Report on Form 10-K is filed. "Execution Time"
shall mean the date and time that this Agreement is executed and delivered by
the parties hereto. "Basic Prospectus" shall mean the form of basic prospectus
relating to the Securities contained in the Registration Statement at the
Effective Date. "Prospectus" shall mean the Basic Prospectus as supplemented by
the Prospectus Supplement and any applicable Pricing Supplement. "Registration
Statement" shall mean the registration statement referred to in paragraph (a)
above, including incorporated documents, exhibits and financial statements, as
amended at the Execution Time. "Rule 415" and "Rule 424", refer to such rules
under the Act. Any reference herein to the Registration Statement, the Basic
Prospectus, the Prospectus Supplement or the Prospectus shall be deemed to refer
to and include the documents incorporated by reference therein pursuant to Item
12 of Form S-3, which were filed under the Exchange Act on or before the
Effective Date of the Registration Statement or the issue date of the Basic
Prospectus, the Prospectus Supplement or the Prospectus, as the case may be; and
any reference herein to the terms "amend", "amendment" or "supplement" with
respect to
3
the Registration Statement, the Basic Prospectus, the Prospectus Supplement or
the Prospectus shall be deemed to refer to and include the filing of any
document under the Exchange Act after the Effective Date of the Registration
Statement or the issue date of the Basic Prospectus, the Prospectus Supplement
or the Prospectus, as the case may be, deemed to be incorporated therein by
reference.
2. Appointment of Agent; Solicitation by the Agent of Offers to
Purchase; Sales of Notes to a Purchaser. (a) Subject to the terms and conditions
set forth herein and to the reservation by the Company of the right to sell
Securities directly on its own behalf, the Company hereby authorizes the Agent
to act as its agent to solicit offers for the purchase of all or part of the
Notes from the Company.
On the basis of the representations and warranties, and subject to the
terms and conditions set forth herein, the Agent agrees, as agent of the
Company, when requested by the Company to use its reasonable best efforts to
solicit offers to purchase the Notes from the Company upon the terms and
conditions set forth in the Prospectus (and any supplement thereto) and in the
Procedures. The Agent shall make reasonable efforts to assist the Company in
obtaining performance by each purchaser whose offer to purchase Notes has been
solicited by the Agent and accepted by the Company, but the Agent shall not,
except as otherwise provided in this Agreement, be obligated to disclose the
identity of any purchaser or have any liability to the Company in the event any
such purchase is not consummated for any reason. Except as provided in Section
2(b), under no circumstances will the Agent be obligated to purchase any Notes
for its own account. It is understood and agreed, however, that if approved by
the Company the Agent may purchase Notes as principal pursuant to Section 2(b).
The Agent agrees that in carrying out the transactions contemplated by
the Agreement, it will observe and comply with all securities or blue sky laws,
regulations, rules and ordinances in any jurisdiction in which the Notes may be
offered, sold or delivered applicable to it as Agent hereunder. The Agent agrees
not to cause any advertisement of the Notes to be published in any newspaper or
periodical or posted in any public place and not to publicly issue any circular
relating to the Notes other than the Prospectus, except in any case with the
prior express consent of the Company.
The Company reserves the right, in its sole discretion, to instruct
the Agent to suspend at any time, for any period of time or permanently, the
solicitation of offers to purchase Notes. Upon receipt of instructions from the
Company, the Agent will forthwith suspend solicitation of offers to purchase
Notes from the Company until such time as the Company has advised it that such
solicitation may be resumed.
The Company agrees to pay the Agent a commission, for the Agent's
services in acting as an agent and not for a purchase by the Agent as principal,
on the Closing Date with respect to each sale of Notes by the Company as a
result of a solicitation made by the Agent, in an amount equal to that
percentage specified in Schedule I hereto of the aggregate principal amount of
the Notes sold by the Company. Such commission shall be payable as specified in
the Procedures.
4
The Company may from time to time offer Securities or Notes for sale
otherwise than through the Agent or the agents under the October 1, 2001 Selling
Agency Agreement and from time to time may appoint additional agents to sell the
Notes; provided, however, that so long as this Agreement shall be in effect, the
Company shall not solicit or accept offers to purchase Notes through any agent
other than the Agent or the agents under the October 1, 2001 Selling Agency
Agreement, except that the Company may accept offers to purchase Notes through
an agent other than the Agent or the agents under the October 1, 2001 Selling
Agency Agreement if the Company gives the Agent and the agents under the October
1, 2001 Selling Agency Agreement reasonable prior notice of such acceptance and
any such agent enters into an agreement with the Company on terms which are
substantially similar to those contained in or incorporated in this Agreement.
If the Company shall default in its obligations to deliver Notes to a
purchaser whose offer it has accepted, the Company shall indemnify and hold you
harmless against any loss, claim or damage arising from or as a result of such
default by the Company.
(b) Subject to the terms and conditions stated herein, whenever the
Company and you determine that the Company shall sell Notes directly to you as
principal, each such sale of Notes shall be made in accordance with the terms of
this Agreement and a supplemental agreement relating to such sale. Each such
supplemental agreement is herein referred to as a "Terms Agreement". Each Terms
Agreement shall describe the Notes to be purchased by the Purchaser pursuant
thereto and shall specify the aggregate principal amount of such Notes, the
price to be paid to the Company for such Notes, the maturity date of such Notes,
the rate at which interest will be paid on such Notes, the dates on which
interest will be paid on such Notes and the record date with respect to each
such payment of interest, the Closing Date for the purchase of such Notes, the
place of delivery of the Notes and payment therefor, the method of payment and
any requirements for the delivery of opinions of counsel, certificates from the
Company or its officers or a letter from the Company's independent public
accountants as described in Section 6(b). Any such Terms Agreement may also
specify the period of time referred to in Section 4(1) and certain terms of the
reoffering of the Notes. Any Terms Agreement shall be substantially in the form
attached hereto as Exhibit B and may take the form of an exchange of any
standard form of written telecommunication between the Purchaser and the
Company. The Purchaser's commitment to purchase Notes shall be deemed to have
been made on the basis of the representations and warranties of the Company
herein contained and shall be subject to the terms and conditions herein set
forth.
Delivery of the certificates for Notes sold to the Purchaser pursuant
to a Terms Agreement shall be made not later than the Closing Date agreed to in
such Terms Agreement, against payment of funds to the Company in the net amount
due to the Company for such Notes by the method and in the form set forth in the
Procedures unless otherwise agreed to between the Company and the Purchaser in
such Terms Agreement.
Unless otherwise agreed to between the Company and the Purchaser in a
Terms Agreement, any Note sold to a Purchaser (i) shall be purchased by such
Purchaser at a price equal to 100% of the principal amount thereof less a
percentage equal to the commission applicable to an agency sale of a Note of
identical maturity and (ii) may be resold by such Purchaser at varying prices
related to prevailing market prices determined at the time of resale
5
or, if set forth in the applicable Terms Agreement and Pricing Supplement, at a
fixed public offering price. In connection with any resale of Notes purchased, a
Purchaser may use a selling or dealer group and may reallow to any broker or
dealer any portion of the discount or commission payable pursuant hereto. Any
resale at a discount may not exceed the amount set forth in the Pricing
Supplement relating to such Notes.
3. Offering and Sale of Notes. The Agent and the Company agree to
perform the respective duties and obligations specifically provided to be
performed by them in the Procedures.
4. Agreements. The Company agrees with you that:
(a) Prior to the termination of the offering of the Notes (including
by way of resale by a Purchaser of Notes), the Company will not file any
amendment to the Registration Statement or supplement to the Prospectus (except
for (i) periodic or current reports filed under the Exchange Act, (ii) a
supplement relating to any offering of Notes providing solely for the
specification of or a change in the maturity dates, interest rates, issuance
prices or other similar terms of any Notes or (iii) an amendment or a supplement
relating to an offering of Securities other than the Notes) unless the Company
has furnished you through your counsel a copy for your review prior to filing
and given you a reasonable opportunity to comment on any such proposed amendment
or supplement. Subject to the foregoing sentence, the Company will cause each
supplement to the Prospectus to be filed with the Commission pursuant to the
applicable paragraph of Rule 424(b) within the time period prescribed and will
provide evidence satisfactory to you of such filing. The Company will promptly
advise you (i) when the Prospectus, and any supplement thereto, shall have been
filed with the Commission pursuant to Rule 424(b), (ii) when, prior to
termination of any offering of Notes, any amendment of the Registration
Statement (except periodic or current reports filed under the Exchange Act)
shall have been filed or become effective, (iii) of any request by the
Commission for any amendment of the Registration Statement or supplement to the
Prospectus or for any additional information, (iv) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or the institution or threatening of any proceeding for that purpose
and (v) of the receipt by the Company of any notification with respect to the
suspension of the qualification of the Notes for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose. The Company will
use its best efforts to prevent the issuance of any such stop order and, if
issued, to obtain as soon as possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the Notes is
required to be delivered under the Act, any event occurs as a result of which
the Prospectus as then supplemented would include any untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it shall be necessary to amend the Registration
Statement or to supplement the Prospectus to comply with the Act or the Exchange
Act or the respective rules thereunder, the Company promptly will (i) notify you
to suspend solicitation of offers to purchase Notes (and, if so notified by the
Company, you shall forthwith suspend such solicitation and cease using the
Prospectus as then supplemented), (ii) prepare and file with the Commission,
subject to the first sentence of paragraph (a) of this Section 4, an amendment
or supplement which will correct such statement or omission or effect such
compliance and (iii) supply any
6
supplemented Prospectus to you in such quantities as you may reasonably request.
If such amendment or supplement is satisfactory in all respects to you, you
will, upon the filing of such amendment or supplement with the Commission and
upon the effectiveness of an amendment to the Registration Statement, if such an
amendment is required, resume your obligation to solicit offers to purchase
Notes hereunder.
(c) The Company, during the period when a prospectus relating to the
Notes is required to be delivered under the Act, will file promptly all
documents required to be filed with the Commission pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act and will furnish to you copies of such
documents.
(d) As soon as practicable, the Company will make generally available
to its security holders and to you an earnings statement or statements of the
Company and its subsidiaries which will satisfy the provisions of Section 11(a)
of the Act and Rule 158 under the Act.
(e) The Company will furnish to you and your counsel, without charge,
copies of the Registration Statement (including exhibits thereto) and, so long
as delivery of a prospectus may be required by the Act, as many copies of the
Prospectus and any supplement thereto as you may reasonably request.
(f) The Company will use its best efforts to arrange for the
qualification of the Notes for sale under the laws of such jurisdictions as you
may reasonably designate, will maintain such qualifications in effect so long as
required for the distribution of the Notes, except that the Company shall not be
required to qualify as a foreign corporation or dealer in securities or to
execute a general consent to service of process in any jurisdiction.
(g) The Company shall, whether or not any sale of the Notes is
consummated, (i) pay all expenses incident to the performance of its obligations
under this Agreement and any Terms Agreement, including the fees and
disbursements of its accountants and counsel, the cost of printing or other
production and delivery of the Registration Statement, the Prospectus, all
amendments thereof and supplements thereto, the Supplemental Indenture, this
Agreement, any Terms Agreement and all other documents relating to the offering,
the cost of preparing, printing, packaging and delivering the Notes, the fees
and disbursements of your counsel incurred in compliance with Section 4(f) (such
fees not to exceed $10,000), the fees and disbursements of the Trustee and the
fees of any agency that rates the Notes, (ii) reimburse you as requested for all
out-of-pocket expenses (including pre-approved advertising expenses), if any,
incurred by you in connection with the implementation of this program and (iii)
pay the reasonable fees and expenses of your counsel incurred in connection with
the implementation of this program.
(h) Each acceptance by the Company of an offer to purchase Notes will
be deemed to be an affirmation that its representations and warranties contained
in this Agreement are true and correct at the time of such acceptance, as though
made at and as of such time, and a covenant that such representations and
warranties will be true and correct at the Closing Date relating to such
acceptance, as though made at and as of such time (it being understood that for
purposes of the foregoing affirmation and covenant such representations and
warranties shall
7
relate to the Registration Statement and Prospectus as amended or supplemented
at each such time). Each such acceptance by the Company of an offer for the
purchase of Notes shall be deemed to constitute an additional representation,
warranty and agreement by the Company that, as of the Closing Date for the sale
of such Notes, after giving effect to the issuance of such Notes, of any other
Notes to be issued on or prior to such Closing Date and of any other Securities
to be issued and sold by the Company on or prior to such Closing Date, the
aggregate amount of Securities (including any Notes) which have been issued and
sold by the Company will not exceed the amount of Securities registered pursuant
to the Registration Statement. The Company will inform you promptly upon your
request of the aggregate amount of Securities registered under the Registration
Statement which remain unsold.
(i) Each time that the Registration Statement or the Prospectus is
amended or supplemented (other than by an amendment or supplement (i) relating
to any offering of Securities other than the Notes, (ii) providing solely for
the specification of or a change in the maturity dates, the interest rates, the
issuance prices or other similar terms of any Notes sold pursuant hereto or a
change in the principal amount of Securities remaining to be sold or (iii) in
the form of an 8-K filed with the Commission solely for the purpose of filing
exhibits pursuant to Item 601 of Regulation S-K), the Company will deliver or
cause to be delivered promptly to you a certificate of the Company, signed by
the Chairman of the Board or the President or the principal financial or
accounting officer of the Company, dated the date of the effectiveness of such
amendment or the date of the filing of such supplement, in form reasonably
satisfactory to you, of the same tenor as the certificate referred to in Section
5(d) but modified to relate to the last day of the fiscal quarter for which
financial statements of the Company were last filed with the Commission and to
the Registration Statement and the Prospectus as amended and supplemented to the
time of the effectiveness of such amendment or the filing of such supplement.
(j) Each time that the Registration Statement or the Prospectus is
amended or supplemented (other than by an amendment or supplement (i) relating
to any offering of Securities other than the Notes, (ii) providing solely for
the specification of or a change in the maturity dates, the interest rates, the
issuance prices or other similar terms of any Notes sold pursuant hereto or a
change in the principal amount of Securities remaining to be sold or (iii) in
the form of an 8-K filed with the Commission solely for the purpose of filing
exhibits pursuant to Item 601 of Regulation S-K or (iv) setting forth or
incorporating by reference financial statements or other information as of and
for a fiscal quarter, unless, in the case of clause (iv) above, in your
reasonable judgment, such financial statements or other information are of such
a nature that an opinion of counsel should be furnished), the Company shall
furnish or cause to be furnished promptly to you a written opinion of counsel
for the Company, dated the date of the effectiveness of such amendment or the
date of the filing of such supplement, in form satisfactory to you, of the same
tenor as the opinion referred to in Section 5(b) but modified to relate to the
Registration Statement and the Prospectus as amended and supplemented to the
time of the effectiveness of such amendment or the filing of such supplement or,
in lieu of such opinion, counsel last furnishing such an opinion to you may
furnish you with a letter to the effect that you may rely on such last opinion
to the same extent as though it were dated the date of such letter authorizing
reliance (except that statements in such last opinion will be deemed to relate
to the Registration Statement and the Prospectus as amended and supplemented to
the time of the effectiveness of such amendment or the filing of such
supplement).
8
(k) Each time that the Registration Statement or the Prospectus is
amended or supplemented to include or incorporate amended or supplemental
financial information, the Company shall cause its independent public
accountants promptly to furnish you a letter, dated five business days after the
date of the effectiveness of such amendment or the date of the filing of such
supplement, in form satisfactory to you, of the same tenor as the letter
referred to in Section 5(e) with such changes as may be necessary to reflect the
amended and supplemental financial information included or incorporated by
reference in the Registration Statement and the Prospectus, as amended or
supplemented to the date of such letter; provided, however, that, if the
Registration Statement or the Prospectus is amended or supplemented solely to
include or incorporate by reference financial information as of and for a fiscal
quarter, the Company's independent public accountants may limit the scope of
such letter, which shall be satisfactory in form to you, to the unaudited
financial statements, the related "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and any other information of an
accounting, financial or statistical nature included in such amendment or
supplement, unless, in your reasonable judgment, such letter should cover other
information or changes in specified financial statement line items.
(l) During the period, if any, specified in any Terms Agreement, the
Company shall not, without the prior consent of the Purchaser thereunder, offer,
sell or contract to sell, or otherwise dispose of, directly or indirectly, or
announce the offering of, any first mortgage bonds issued by the Company (other
than the Notes being sold pursuant to such Terms Agreement).
(m) Notwithstanding the foregoing, it is agreed that if, at any time
and from time to time during the term of this Agreement, the Company should
deliver to the Agent notification of its decision to suspend any sale of Notes
hereunder, then during the period of any such suspension or suspensions the
Company shall be relieved of its obligation to provide to the Agent the
certificate, opinions and letter required pursuant to Sections 4(i), 4(j) and
4(k) hereof. However, whenever such a suspension is lifted, the Company shall be
required to deliver to the Agent, prior to the resumption of any sale of Notes
hereunder, the most recent certificate, opinions and letter which would have
been required except for the suspension.
(n) During the term of this Agreement, the Company shall furnish to
the Agent (i) copies of all annual, quarterly and other reports furnished to the
shareholder of the Company, (ii) copies of all annual, quarterly and current
reports (without exhibits but including documents incorporated therein by
reference) of the Company filed with the Commission under the Exchange Act,
(iii) copies of all announcements made to the general financial community and
(iv) notice of (x) any decrease in the rating or (y) credit watch with negative
implications, in either case of the Notes or any other debt securities of the
Company, by any "nationally recognized statistical rating organization" (as
defined for purposes of Rule 436(g) under the Act).
(o) The Company agrees that any person who has agreed to purchase and
pay for any Note pursuant to a solicitation by the Agent shall have the right to
refuse to purchase such Note if, subsequent to the agreement to purchase such
Note, any change, condition or development specified in any of Sections
8(b)(iii), (iv) or (v) shall have occurred (with the judgment of the Agent which
presented the offer to purchase such Note being substituted for any judgment of
a Purchaser required therein) the effect of which is, in the judgment of the
Agent
9
which presented the offer to purchase such Note, so material and adverse as to
make it impractical or inadvisable to proceed with the sale and delivery of such
Note (it being understood that under no circumstance shall the Agent have any
duty or obligation to the Company or to any such person to exercise the judgment
permitted to be exercised under this Section 4(o)).
5. Conditions to the Obligations of the Agent. The obligations of the
Agent to solicit offers to purchase the Notes shall be subject to the accuracy
of the representations and warranties on the part of the Company contained
herein as of the Execution Time, on the Effective Date, when any supplement to
the Prospectus relating to the Notes is filed with the Commission and as of each
Closing Date, to the accuracy of the statements of the Company made in any
certificates pursuant to the provisions hereof, to the performance by the
Company of its obligations hereunder and to the following additional conditions:
(a) If filing of the Prospectus, or any supplement thereto, is
required pursuant to Rule 424(b), the Prospectus, and any such supplement, shall
have been filed in the manner and within the time period required by Rule
424(b); and no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been instituted or threatened.
(b) The Company shall have furnished to the Agent the opinions of
▇▇▇▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, L.L.P., counsel to the Company and ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, Esq., General Counsel for the Company, dated the Execution Time
substantially in the forms of Exhibits D and E hereto.
(c) The Agent shall have received from ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel
for the Agent, such opinion or opinions, dated the Execution Time, with respect
to the incorporation of the Company, the validity of the Indenture and the
Notes, the Registration Statement, the Prospectus (together with any supplement
thereto) and other related matters as the Agent may reasonably require, and the
Company shall have furnished to such counsel such documents as they may
reasonably request for the purpose of enabling them to pass upon such matters.
In rendering their opinions, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ may rely upon the opinion
described above of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq., General Counsel for the Company, as
to all matters of Idaho, Montana, Nevada, Oregon and Wyoming law.
(d) The Company shall have furnished to the Agent a certificate of the
Company, signed by the Chairman of the Board or the President or the principal
financial or accounting officer of the Company, dated the Execution Time, to the
effect that:
(i) the representations and warranties of the Company in this
Agreement are true and correct in all material respects on and as of the
date hereof with the same effect as if made on the date hereof and the
Company has complied with all the agreements and satisfied all the
conditions on its part to be performed or satisfied as a condition to the
obligation of the Agent to solicit offers to purchase the Notes;
10
(ii) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or, to the Company's knowledge, threatened; and
(iii) since the date of the most recent audited financial statements
included in or incorporated by reference in the Prospectus, 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 other), earnings, business or properties of the Company and its
subsidiaries considered as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth in or
contemplated by the Prospectus.
(e) At the Execution Time, Deloitte & Touche shall have furnished to
the Agent a letter or letters (which may refer to letters previously delivered
to the Agent), dated as of the Execution Time to the effect set forth in Exhibit
C hereto.
(f) Prior to the Execution Time, the Company shall have furnished to
the Agent such further information, documents and certificates as the Agent may
reasonably request.
If any of the conditions specified in this Section 5 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
or if any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Agent and its counsel, this Agreement and all obligations
of the Agent hereunder may be cancelled at any time by the Agent. Notice of such
cancellation shall be given to the Company in writing or by telephone or
telegraph confirmed in writing.
The documents required to be delivered by this Section 5 shall be
delivered at the office of LeBoeuf, Lamb, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, L.L.P., counsel for
the Company, on the date hereof.
6. Conditions to the Obligations of a Purchaser. The obligations of a
Purchaser to purchase any Notes will be subject to the accuracy of the
representations and warranties on the part of the Company herein as of the date
of the related Terms Agreement and as of the Closing Date for such Notes, to the
performance and observance by the Company of all covenants and agreements herein
contained on its part to be performed and observed and to the following
additional conditions precedent:
(a) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been instituted or threatened.
(b) To the extent agreed to between the Company and the Purchaser in a
Terms Agreement, the Purchaser shall have received, appropriately updated, (i) a
certificate of the Company, dated as of the Closing Date, to the effect set
forth in Section 5(d) (except that references to the Prospectus shall be to the
Prospectus as supplemented as of the date of such Terms Agreement), (ii) the
opinions of LeBoeuf, Lamb, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, ▇.▇.▇., and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.,
counsel for the Company, dated as of the Closing Date, to the effect referred
11
to in Section 5(b), (iii) the opinion(s) of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the
Purchaser, dated as of the Closing Date, to the effect referred to in Section
5(c), and (iv) the letter of Deloitte & Touche, independent accountants for the
Company, dated as of the Closing Date, to the effect referred to in Section
5(e).
(c) Prior to the Closing Date, the Company shall have furnished to the
Purchaser such further information, certificates and documents as the Purchaser
may reasonably request.
If any of the conditions specified in this Section 6 shall not have
been fulfilled in all material respects when and as provided in this Agreement
and the applicable Terms Agreement, or if any of the opinions and certificates
mentioned above or elsewhere in this Agreement or such Terms Agreement and
required to be delivered to the Purchaser pursuant to the terms hereof and
thereof shall not be in all material respects reasonably satisfactory in form
and substance to the Purchaser and its counsel, such Terms Agreement and all
obligations of the Purchaser thereunder and with respect to the Notes subject
thereto may be cancelled at, or at any time prior to, the respective Closing
Date by the Purchaser. Notice of such cancellation shall be given to the Company
in writing or by telephone or telegraph confirmed in writing.
7. Indemnification. (a) The Company will indemnify you and hold you
harmless against any losses, claims, damages or liabilities, joint or several,
to which you may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in any preliminary prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus, or any
amendment or supplement thereto, and any other prospectus relating to the Notes,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading; and will reimburse you for any legal or other
expenses reasonably incurred by you in connection with investigating or
defending against such loss, claim, damage, liability or action as such expenses
are incurred; provided, however, that the Company shall not be liable in any
such case to the extent that any such loss, claim, damage or liability arises
out of or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission made in any preliminary prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus, or such
amendment or supplement and any other prospectus relating to the Notes, in
reliance upon and in conformity with information furnished in writing to the
Company by you or on your behalf for inclusion therein or arising out of, or
based upon, statements in or omissions from Exhibits 25.1 and 25.3 to the
Registration Statement which shall constitute the Statements of Eligibility of
the Trustees on Forms T-1 and T-2, or amendments thereto, under the Indenture
and provided further that the Company shall not be liable to you under the
indemnity agreement in this subsection on account of any such loss, claim,
damage or liability of yours arising from the sale of the Notes to any person,
if at or prior to the written confirmation of such sale a copy of the Prospectus
(exclusive of the documents incorporated by reference therein), or of the
Prospectus as then amended or supplemented (exclusive of the documents
incorporated by reference therein) shall not have been given or sent to such
person by you or on your behalf. This indemnity agreement shall be in addition
to any liability which the Company may otherwise have.
12
The foregoing indemnity agreement shall, upon the same terms and
conditions, extend to and inure to the benefit of each person, if any, who
controls you within the meaning of the Act.
(b) You will indemnify and hold harmless the Company against any
losses, claims, damages or liabilities to which the Company may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
any preliminary prospectus, any preliminary prospectus supplement, the
Registration Statement, the Prospectus, or any amendment or supplement thereto,
and any other prospectus relating to the Notes, or arise out of or are based
upon the omission or the alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in a preliminary prospectus, any preliminary prospectus supplement, the
Registration Statement, the Prospectus, or such amendment or supplement, and any
other Prospectus relating to the Notes, in reliance upon and in conformity with
information furnished in writing to the Company by you or on your behalf for
inclusion therein; and will reimburse the Company for any legal or other
expenses reasonably incurred by the Company in connection with investigating or
defending against any such loss, claim, damage, liability or action as such
expenses are incurred. This indemnity agreement shall be in addition to any
liability which you may otherwise have.
The foregoing indemnity agreement shall, upon the same terms and
conditions, extend to and inure to the benefit of each director of the Company,
each of its officers who has signed the Registration Statement and each person,
if any, who controls the Company within the meaning of the Act.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party, and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate in, and, to the extent that it shall wish, jointly with
any other indemnifying party similarly notified, to assume the defense thereof,
with counsel satisfactory to such indemnified party (who shall not, except with
the consent of the indemnified party, be counsel to the indemnifying party), and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation.
(d) If the indemnification provided for in this Section 7 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified
13
party as a result of such losses, claims, damages or liabilities (or actions in
respect thereof) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and you on the other from the
offering of the Notes to which such loss, claim, damage or liability (or actions
in respect thereof) relates and also the relative fault of the Company on the
one hand and you on the other in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities (or actions in
respect thereof), as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and you on the other
shall be deemed to be in the same proportion as the total net proceeds from such
offering (before deducting expenses) received by the Company bear to the total
discounts and commissions received by you. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on the one hand
or you on the other and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and you agree that it would not be just and equitable if
contribution pursuant to this subsection (d) 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 subsection (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to above
in this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
subsection (d), you shall not be required to contribute any amount in excess of
the amount by which the total price at which the Notes sold by or through you to
the public exceeds the amount of any damages which you have otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. Your
obligations in this subsection (d) to contribute are several in proportion to
the respective purchases made by or through you to which such loss, claim,
damage or liability (or action in respect thereof) relates and are not joint.
8. Termination. (a) This Agreement will continue in effect until
terminated as provided in this Section 8. This Agreement may be terminated
either by the Company as to the Agent or by you insofar as this Agreement
relates to the Agent, by giving written notice of such termination to the Agent
or the Company, as the case may be. This Agreement shall so terminate at the
close of business on the first business day following the receipt of such notice
by the party to whom such notice is given. In the event of such termination, no
party shall have any liability to the other party hereto, except as provided in
the fifth paragraph of Section 2(a), Section 4(g), Section 7 and Section 9.
(b) Each Terms Agreement shall be subject to termination in the
absolute discretion of the Purchaser, by written notice given to the Company
prior to delivery of any payment for any Note to be purchased thereunder, if
subsequent to the agreement to purchase such Note and prior to such payment time
(i) there shall have occurred any change in or affecting the business or
properties of the Company and its subsidiaries taken as a whole the effect of
which is, in the judgment of the Purchaser, so material and adverse as to make
it impracticable or inadvisable to enforce contracts for the sale of such Note,
(ii) there shall have been any decrease
14
in the rating of any of the Company's first mortgage bonds by ▇▇▇▇▇'▇ Investors
Service Inc. or Standard & Poor's Corporation the effect of which is, in the
judgment of the Purchaser, so material and adverse as to make it impracticable
or inadvisable to enforce contracts for the sale of such Notes, (iii) trading in
securities generally on the New York Stock Exchange shall have been suspended or
limited or minimum prices shall have been established on such Exchange, (iv) a
general moratorium on commercial banking activities shall have been declared by
either Federal or New York State authorities or a material disruption in
commercial banking or securities settlement or clearance services in the United
States shall have occurred, (v) there shall have occurred any outbreak or
escalation of hostilities, declaration by the United States of a national
emergency or war or other calamity or crisis the effect of which is such as to
make it, in the judgment of the Purchaser, impracticable or inadvisable to
proceed with the public offering or the delivery of the Notes on the terms and
in the manner contemplated in the Prospectus or (vi) there shall have occurred
any adverse change in national or international financial, political or economic
conditions the effect of which is such as to make it, in the judgment of the
Purchaser, impracticable or inadvisable to proceed with the public offering or
the delivery of the Notes on the terms and in the manner contemplated in the
Prospectus.
9. Survival of Certain Provisions. The respective representations,
warranties, indemnities and other statements of the Company or its officers and
of you set forth in or made pursuant to this Agreement will remain in full force
and effect, regardless of any investigation made by or on behalf of you or the
Company or any of the persons referred to in Section 7 hereof, and will survive
delivery of and payment for the Notes. The provisions of Sections 4(g) and 7
hereof shall survive the termination or cancellation of this Agreement. The
provisions of this Agreement applicable to any purchase of a Note for which an
agreement to purchase exists prior to the termination hereof shall survive any
termination of this Agreement. If at the time of termination of this Agreement
any Purchaser shall own any Notes with the intention of selling them, the
provisions of Section 4 shall remain in effect until such Notes are sold by the
Purchaser.
10. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to you, will be mailed, delivered or
telegraphed and confirmed to you, at the address specified in Schedule I hereto;
or, if sent to the Company, will be mailed, delivered or telegraphed and
confirmed to it at ▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, attention of
the Secretary.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto, their respective successors, the controlling
persons referred to in Section 7 hereof and no other person will have any right
or obligation hereunder.
12. Applicable Law. This Agreement will be governed by and construed
in accordance with the laws of the State of New York.
13. Counterparts. This Agreement may be executed by any one or more of
the parties hereto and thereto in any number of counterparts, each of which
shall be deemed to be an original, but all such respective counterparts shall
together constitute one and the same instrument.
15
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement between the
Company and you.
Very truly yours,
IDAHO POWER COMPANY
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Vice President, Chief
Financial Officer and Treasurer
The foregoing Agreement is
hereby confirmed and accepted
as of the date hereof.
WACHOVIA SECURITIES, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Managing Director
SCHEDULE I
Commissions:
The Company agrees to pay the Agent a commission equal to the
following percentage of the principal amount of each Note sold on an agency
basis by the Agent:
Term Commission Rate
9 months to less than 12 months 0.125%
12 months to less than 18 months 0.150
18 months to less than 2 years 0.200
2 years to less than 3 years 0.250
3 years to less than 4 years 0.350
4 years to less than 5 years 0.450
5 years to less than 6 years 0.500
6 years to less than 7 years 0.550
7 years to less than 10 years 0.600
10 years to less than 15 years 0.625
15 years to less than 20 years 0.675
20 years or more 0.750
Unless otherwise specified in the applicable Terms Agreement, the
discount or commission payable to a Purchaser shall be determined on the basis
of the commission schedule set forth above.
Address for Notice to Agent:
Notices to Wachovia Securities, Inc. shall be directed to it at ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention of ▇▇▇ ▇▇▇▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
EXHIBIT A
IDAHO POWER COMPANY
First Mortgage Bonds,
Secured Medium-Term Notes, Series D, Administrative Procedures
Book-Entry Form
The First Mortgage Bonds, Secured Medium-Term Notes, Series D, Due
from Nine Months to Thirty Years from Date of Issue (the "Notes") of Idaho Power
Company (the "Company") are to be offered on a continuing basis. Wachovia
Securities, Inc., as agent (the "Agent"), has agreed to use its reasonable best
efforts to solicit purchases of Notes issued in fully registered form. The Agent
will not be obligated to purchase Notes for its own account. The Notes are being
sold pursuant to a Selling Agency Agreement between the Company and the agent
named therein dated the date hereof (the "Agency Agreement"). The Notes have
been registered with the Securities and Exchange Commission (the "Commission").
The Notes will be issued under the Company's Indenture of Mortgage and Deed of
Trust, dated as of October 1, 1937, between the Company and Deutsche Bank Trust
Company Americas, formerly known as Bankers Trust Company (the "Trustee") and
R.G. ▇▇▇▇ (▇▇▇▇▇▇▇ ▇▇▇▇, successor individual trustee), as trustees, as
supplemented, pursuant to the Thirty-sixth Supplemental Indenture dated as of
October 1, 2001 (the "Indenture").
The Agency Agreement provides that Notes may also be purchased by the
Agent acting solely as principal and not as agent. In the event of any such
purchase, the functions of both the Agent and the beneficial owner under the
administrative procedures set forth below shall be performed by the Agent acting
solely as principal, unless otherwise agreed to between the Company and the
Agent acting as principal.
Each Note will be represented by a Global Security (as defined
hereinafter) delivered to Deutsche Bank Trust Company Americas ("Deutsche Bank")
as agent for The Depository Trust Company ("DTC"), and recorded in the
book-entry system maintained by DTC (a "Book-Entry Note"). An owner of a
Book-Entry Note will not be entitled to receive a certificate representing such
Note.
The procedures to be followed during, and the specific terms of, the
solicitation of orders by the Agent and the sale as a result thereof by the
Company are explained below. Administrative and record-keeping responsibilities
will be handled for the Company by its Finance Department. The Company will
advise the Agent and the Trustee in writing of those persons handling
administrative responsibilities with whom the Agent and the Trustee are to
communicate regarding orders to purchase Notes and the details of their
delivery.
Administrative procedures and specific terms of the offering are
explained below. Book-Entry Notes will be issued in accordance with the
administrative procedures set forth below, as adjusted in accordance with
changes in DTC's operating requirements. Unless otherwise defined herein, terms
defined in the Indenture and the Notes shall be used herein as therein defined.
Only fixed rate Notes may be issued. To the extent the procedures set forth
below conflict with the provisions of the Notes, the Indenture, DTC's operating
requirements or
the Agency Agreement, the relevant provisions of the Notes, the Indenture, DTC's
operating requirements and the Agency Agreement shall control.
Administrative Procedures for
Book-Entry Notes
In connection with the qualification of the Book-Entry Notes for
eligibility in the book-entry system maintained by DTC, Deutsche Bank will
perform the custodial, document control and administrative functions described
below, in accordance with its respective obligations under a Letter of
Representations from the Company and Deutsche Bank to DTC dated as of October 1,
2001 and a Medium-Term Note Certificate Agreement between Deutsche Bank and DTC,
dated as of October 21, 1988, and its obligations as a participant in DTC,
including DTC's Same-Day Funds Settlement system ("SDFS").
Issuance: On any date of settlement (as defined under
"Settlement" below) for one or more Book-Entry
Notes, the Company will issue a single global
security in fully registered form without coupons
(a "Global Security") representing up to
$200,000,000 principal amount of all such
Book-Entry Notes that have the same Issue Date,
original issue discount provisions, if any,
Interest Payment Dates, Regular Record Dates,
redemption, repayment and extension provisions,
if any, Maturity Date, and interest rate
(collectively, the "Terms"). Each Global Security
will be dated and issued as of the date of its
authentication by the Trustee. Each Global
Security will bear an original issue date, which
will be (i) with respect to an original Global
Security (or any portion thereof), the original
issue date specified in such Global Security and
(ii) following a consolidation of Global
Securities, with respect to the Global Security
resulting from such consolidation, the most
recent Interest Payment Date to which interest
has been paid or duly provided for on the
predecessor Global Securities, regardless of the
date of authentication of such resulting Global
Security. No Global Security will represent any
securities in certificated form.
Identification Numbers: The Company has arranged with the CUSIP Service
Bureau of Standard & Poor's Corporation (the
"CUSIP Service Bureau") for the reservation of a
series of CUSIP numbers, which series consists of
approximately 900 CUSIP numbers and relates to
Global Securities representing Book-Entry Notes
and book-entry medium-term notes issued by the
Company with other series designations. Deutsche
Bank, the Company and DTC have obtained from the
CUSIP Service Bureau a written list of such
reserved CUSIP numbers. Deutsche Bank will assign
CUSIP numbers to Global Securities as described
below under Settlement Procedure "B". DTC will
notify the CUSIP Service Bureau periodically of
the CUSIP numbers that Deutsche Bank has assigned
to Global Securities. Deutsche Bank will notify
the Company at any time when fewer than 100 of
the reserved CUSIP numbers remain unassigned to
Global Securities, and, if it deems necessary,
the Company will reserve
A-2
additional CUSIP numbers for assignment to Global
Securities. Upon obtaining such additional CUSIP
numbers, Deutsche Bank or the Company shall
deliver a list of such additional CUSIP numbers
to DTC.
Registration: Global Securities will be issued only in fully
registered form without coupons. Each Global
Security will be registered in the name of Cede
& Co., as nominee for DTC, or such other name as
may be requested by DTC, on the bond register for
the Notes maintained under the Indenture. The
beneficial owner of a Book-Entry Note (or one or
more indirect participants in DTC designated by
such owner) will designate one or more
participants in DTC (with respect to such
Book-Entry Note, the "Participants") to act as
agent or agents for such owner in connection with
the book-entry system maintained by DTC, and DTC
will record in book-entry form, in accordance
with instructions provided by such Participants,
a credit balance with respect to such beneficial
owner in such Book-Entry Note in the account of
such Participants. The ownership interest of
such beneficial owner (or such participant) in
such Book-Entry Note will be recorded through the
records of such Participants or through the
separate records of such Participants and one or
more indirect participants in DTC.
Transfers: Transfers of a Book-Entry Note will be
accomplished by book entries made by DTC and, in
turn, by Participants (and in certain cases, one
or more indirect participants in DTC) acting on
behalf of beneficial transferors and transferees
of such Note.
Exchanges: After the first Interest Payment Date on
individual issues of the Notes, Deutsche Bank may
deliver to DTC's Reorganization Department,
Interactive Data Control and the CUSIP Service
Bureau at any time a written notice of
consolidation (a copy of which shall be attached
to the resulting Global Security described below)
specifying (i) the CUSIP numbers of two or more
outstanding Global Securities that represent
Book-Entry Notes having the same Terms and for
which interest has been paid to the same date,
(ii) a date, occurring at least thirty days after
such written notice is delivered and at least
thirty days before the next Interest Payment Date
for such Book-Entry Notes, on which such Global
Securities shall be exchanged for a single
replacement Global Security and (iii) a new CUSIP
number to be assigned to such replacement Global
Security. Upon receipt of such a notice, DTC
will send to its participants (including Deutsche
Bank) a written reorganization notice to the
effect that such exchange will occur on such
date. Prior to the specified exchange date,
Deutsche Bank will deliver to the CUSIP Service
Bureau a written reorganization notice setting
forth such exchange date and such new CUSIP
number and stating that, as of such exchange
date, the CUSIP numbers of the Global Securities
to be exchanged will no longer be valid. On the
specified exchange date, Deutsche Bank will
exchange such Global Securities for a single
Global
A-3
Security bearing the new CUSIP number and the
CUSIP numbers of the exchanged Global Securities
will, in accordance with CUSIP Service Bureau
procedures, be cancelled and not immediately
reassigned.
Maturities: Each Book-Entry Note will mature on a date not
less than nine months nor more than
thirty years after the Issue Date for such Note.
Denominations: Book-Entry Notes will be issued in principal
amounts of $1,000 or any amount in excess thereof
that is an integral multiple of $1,000.
Interest: General. Interest, if any, on each Book-Entry
Note will accrue from the Original Interest
Accrual Date for the first interest period or the
last date to which interest has been paid, if
any, for each subsequent interest period, on the
Global Security representing such Book-Entry
Note, and will be calculated and paid in the
manner described in such Book-Entry Note and in
the Prospectus (as defined in the Agency
Agreement), as supplemented by the applicable
Pricing Supplement. Unless otherwise specified
therein, each payment of interest on a Book-Entry
Note will include interest accrued to but
excluding the Interest Payment Date or to but
excluding Maturity (other than a Maturity of a
Book-Entry Note occurring on the 31st day of a
month, in which case such payment of interest
will include interest accrued to but excluding
the 30th day of such month). Interest payable at
the Maturity of a Book-Entry Note will be payable
to the Person to whom the principal of such Note
is payable. Standard & Poor's Corporation will
use the information received in the pending
deposit message described under Settlement
Procedure "C" below in order to include the
amount of any interest payable and certain other
information regarding the related Global Security
in the appropriate (daily or weekly) bond report
published by Standard & Poor's Corporation.
Regular Record Dates. Unless otherwise specified
pursuant to Settlement Procedure "A" below, the
Regular Record Dates with respect to the Interest
Payment Dates set forth below shall be March 15
and September 15.
Interest Payment Dates. Unless otherwise
specified pursuant to Settlement Procedure "A"
below, interest payments on Book-Entry Notes will
be made semiannually on April 1 and October 1 of
each year and at Maturity; provided, however,
that if an Interest Payment Date for a Book-Entry
Note is not a Business Day, the payment due on
such day shall be made on the next succeeding
Business Day and no interest shall accrue on such
payment for the period from and after such
Interest Payment Date; provided further, that in
the case of a Book-Entry Note issued between a
Regular Record Date and an Interest Payment Date,
the first interest payment will be made on the
Interest Payment Date
A-4
following the next succeeding Regular Record
Date.
Calculation of Interest: Interest on Book-Entry Notes (including interest
for partial periods) will be calculated on the
basis of a 360-day year of twelve 30-day months.
Payment of Principal and Payment of Interest Only. Promptly after each
Interest: Regular Record Date, Deutsche Bank will deliver
to the Company and DTC's Dividend Department a
written notice setting forth, by CUSIP number,
the amount of interest to be paid on each Global
Security on the following Interest Payment Date
(other than an Interest Payment Date coinciding
with Maturity) and the total of such amounts. DTC
will confirm the amount payable on each Global
Security on such Interest Payment Date by
reference to the appropriate (daily or weekly)
bond reports published by Standard & Poor's
Corporation. The Company will pay to Deutsche
Bank, as paying agent, the total amount of
interest due on such Interest Payment Date (other
than at Maturity), and Deutsche Bank will pay
such amount to DTC, at the times and in the
manner set forth below under "Manner of Payment".
Payments at Maturity. On or about the first
Business Day of each month, Deutsche Bank will
deliver to the Company and DTC a written list of
principal and interest to be paid on each Global
Security maturing in the following month.
Deutsche Bank, the Company and DTC will confirm
the amounts of such principal and interest
payments with respect to each such Global
Security on or about the fifth Business Day
preceding the Maturity of such Global Security.
On or before Maturity, the Company will pay to
Deutsche Bank, as paying agent, the principal
amount of such Global Security, together with
interest due at such Maturity. Deutsche Bank will
pay such amount to DTC at the times and in the
manner set forth below under "Manner of Payment".
If any maturity of a Global Security representing
Book-Entry Notes is not a Business Day, the
payment due on such day shall be made on the next
succeeding Business Day and no interest shall
accrue on such payment for the period from and
after such Maturity. Promptly after payment to
DTC of the principal and interest due at Maturity
of such Global Security, the Trustee will cancel
such Global Security in accordance with the
Indenture and so advise the Company. On the first
Business Day of each month, Deutsche Bank will
deliver to the Company a written statement
indicating the total principal amount of
Outstanding Global Securities as of the
immediately preceding Business Day. If the
Maturity of a Book-Entry Note is not a Business
Day, the payment due on such day shall be made on
the next succeeding Business Day and no interest
shall accrue on such payment for the period from
and after such Maturity.
Manner of Payment. The total amount of any
principal and interest due on Global Securities
on any Interest Payment Date or at Maturity shall
A-5
be paid by the Company to Deutsche Bank in
immediately available funds on such date. The
Company will make such payment on such Global
Securities by instructing Deutsche Bank to
withdraw funds from an account (Account #
500-15-307) maintained by the Company at Deutsche
Bank or by wire transfer to Deutsche Bank. The
Company will confirm any such instructions in
writing to Deutsche Bank. Prior to 10 A.M. (New
York City time) on the date of Maturity or as
soon as possible thereafter, Deutsche Bank will
pay by separate wire transfer (using Fedwire
message entry instructions in a form previously
specified by DTC) to an account at the Federal
Reserve Bank of New York previously specified by
DTC, in funds available for immediate use by DTC,
each payment of principal (together with interest
thereon) due on a Global Security on such date.
On each Interest Payment Date (other than at
Maturity), interest payments shall be made to
DTC, in funds available for immediate use by DTC,
in accordance with existing arrangements between
Deutsche Bank and DTC. On each such date, DTC
will pay, in accordance with its SDFS operating
procedures then in effect, such amounts in funds
available for immediate use to the respective
Participants in whose names the Book-Entry Notes
represented by such Global Securities are
recorded in the book-entry system maintained by
DTC. Neither the Company nor Deutsche Bank shall
have any direct responsibility or liability for
the payment by DTC to such Participants of the
principal of and interest on the Book-Entry
Notes.
Withholding Taxes. The amount of any taxes
required under applicable law to be withheld from
any interest payment on a Book-Entry Note will be
determined and withheld by the Participant,
indirect participant in DTC or other Person
responsible for forwarding payments and materials
directly to the beneficial owner of such Note.
Procedures upon Company's Company Notice to Trustee Regarding Exercise of
Exercise of Optional Optional Redemption. At least 35 days prior to
Redemption: the date on which it intends to redeem a
Book-Entry Note, the Company will notify the
Trustee that it is exercising such option with
respect to such Book-Entry Note on such date.
Trustee Notice to DTC Regarding Company's
Exercise of Optional Redemption. After receipt of
notice that the Company is exercising its option
to redeem a Book-Entry Note, the Trustee will, at
least 30 days before the redemption date for such
Book-Entry Note, deliver to DTC a notice
identifying such Book-Entry Note by CUSIP number
and informing DTC of the Company's exercise of
such option with respect to such Book-Entry Note.
Deposit of Redemption Price. On or before any
redemption date, the Company shall deposit with
such Trustee an amount of money sufficient
A-6
to pay the redemption price, plus interest
accrued to such redemption date, for all the
Book-Entry Notes or portions thereof which are to
be repaid on such redemption date. Such Trustee
will use such money to repay such Book-Entry
Notes pursuant to the terms set forth in such
Notes.
Procedure for Rate The Company and the Agent will discuss from time
Setting and Posting: to time the aggregate principal amount of, the
issuance price of, and the interest rates to be
borne by, Book-Entry Notes that may be sold as a
result of the solicitation of orders by the
Agent. If the Company decides to set prices of,
and rates borne by, any Book-Entry Notes in
respect of which the Agent is to solicit orders
(the setting of such prices and rates to be
referred to herein as "posting") or if the
Company decides to change prices or rates
previously posted by it, it will promptly advise
the Agent of the prices and rates to be posted.
Acceptance and Unless otherwise instructed by the Company, the
Rejection of Orders: Agent will advise the Company promptly by
telephone of all orders to purchase Book-Entry
Notes received by the Agent, other than those
rejected by it in whole or in part in the
reasonable exercise of its discretion. Unless
otherwise agreed by the Company and the Agent,
the Company has the sole right to accept orders
to purchase Book-Entry Notes and may reject any
such orders in whole or in part.
Preparation of Pricing If any order to purchase a Book-Entry Note is
Supplement: accepted by or on behalf of the Company, the
Company will prepare a pricing supplement (a
"Pricing Supplement") reflecting the applicable
interest rates and other terms of such Book-Entry
Note and will arrange to have such Pricing
Supplement filed with the Commission in
accordance with the applicable paragraph of Rule
424(b) under the Act and will supply at least ten
copies thereof (and additional copies if
requested) to you in your capacity as the Agent
having presented the order (the "Presenting
Agent"). The Presenting Agent will cause a
Prospectus and Pricing Supplement to be
delivered to the purchaser of such Book-Entry
Note.
In each instance that a Pricing Supplement is
prepared, the Presenting Agent will affix the
Pricing Supplement to Prospectuses prior to their
use. Outdated Pricing Supplements (other than
those retained for files) will be destroyed.
Suspension of Solicitation; The Company reserves the right, in its sole
Amendment or Supplement: discretion, to instruct the Agent to suspend at
any time, for any period of time or permanently,
the solicitation of orders to purchase Book-Entry
Notes. Upon receipt of such instructions, the
Agent will forthwith suspend solicitation until
such time as the Company has advised it that such
solicitation may be resumed.
A-7
In the event that at the time the Company
suspends solicitation of purchases there shall be
any orders outstanding for settlement, the
Company will promptly advise the Agent and
Deutsche Bank whether such orders may be settled
and whether copies of the Prospectus as in effect
at the time of the suspension, together with the
appropriate Pricing Supplement, may be delivered
in connection with the settlement of such orders.
The Company will have the sole responsibility for
such decision and for any arrangements that may
be made in the event that the Company determines
that such orders may not be settled or that
copies of such Prospectus may not be so
delivered. If the Company decides to amend or
supplement the Registration Statement (as defined
in the Agency Agreement) or the Prospectus, it
will promptly advise the Agent and furnish the
Agent with the proposed amendment or supplement
and with such certificates and opinions as are
required, all to the extent required by and in
accordance with the terms of the Agency
Agreement. Subject to the provisions of the
Agency Agreement, the Company may file with the
Commission any such supplement to the Prospectus
relating to the Notes. The Company will provide
the Agent and Deutsche Bank with copies of any
such supplement, and confirm to the Agent that
such supplement has been filed with the
Commission pursuant to the applicable paragraph
of Rule 424(b).
Procedures For Rate When the Company has determined to change the
Changes: interest rates of Book-Entry Notes
being offered, it will promptly advise the Agent
and the Agent will forthwith suspend solicitation
of orders. The Agent will telephone the Company
with recommendations as to the changed interest
rates. At such time as the Company has advised
the Agent of the new interest rates, the Agent
may resume solicitation of orders. Until such
time only "indications of interest" may be
recorded.
Delivery of A copy of the Prospectus (including the
Prospectus: Prospectus Supplement) and a Pricing Supplement
relating to a Book-Entry Note must accompany or
precede the earliest of any written offer of such
Book-Entry Note, confirmation of the purchase of
such Book-Entry Note and payment for such
Book-Entry Note by its purchaser. If notice of a
change in the terms of the Book-Entry Notes is
received by the Agent between the time an order
for a Book-Entry Note is placed and the time
written confirmation thereof is sent by the
Presenting Agent to a customer or his agent, such
confirmation shall be accompanied by a Prospectus
and Pricing Supplement setting forth the terms in
effect when the order was placed. Subject to
"Suspension of Solicitation; Amendment or
Supplement" above, the Presenting Agent will
deliver a Prospectus and Pricing Supplement as
herein described with respect to each Book-Entry
Note sold by it. The Company will make such
delivery if such Book-Entry Note is sold directly
by the Company to a purchaser (other than
A-8
the Agent).
Confirmation: For each order to purchase a Book-Entry Note
solicited by the Agent and accepted by or on
behalf of the Company, the Presenting Agent will
issue a confirmation to the purchaser, with a
copy to the Company, setting forth the details
set forth above and delivery and payment
instructions.
Settlement: The receipt by the Company of immediately
available funds in payment for a Book-Entry Note
and the authentication and issuance of the Global
Security representing such Book-Entry Note shall
constitute "settlement" with respect to such
Book-Entry Note. All orders accepted by the
Company will be settled on the third Business Day
following the date of sale of such Book-Entry
Note pursuant to the timetable for settlement set
forth below unless the Company and the purchaser
agree to settlement on another day which shall be
no earlier than the next Business Day following
the date of sale.
Settlement Settlement Procedures with regard to each
Procedures: Book-Entry Note sold by the Company through the
Agent, as agent, shall be as follows:
A. The Presenting Agent will advise the Company
by telephone (confirmed in writing) of the
following settlement information:
1. Exact name of the purchaser.
2. Principal amount.
3. Issue Date.
4. Original Interest Accrual Date.
5. Settlement date.
6. Interest rate.
7. Interest Payment Dates, if other than
April 1 and October 1.
8. Regular Record Dates, if other than March
15 and September 15.
9. Redemption provisions, if any.
10. Maturity date.
11. Purchase Price.
12. Presenting Agent's commission, determined
as provided in Section 2 of the Agency
Agreement and certification that the
A-9
purchasers were solicited solely by the
Agent.
13. Net proceeds to the Company.
B. Deutsche Bank will assign a CUSIP number to
the Global Security representing such
Book-Entry Note and the Company will advise
Deutsche Bank by telephone (confirmed in
writing at any time on the same date) or
electronic transmission of the information
set forth in Settlement Procedure "A" above,
such CUSIP number and the name of the
Presenting Agent. Deutsche Bank will also
notify the Presenting Agent by telephone of
such CUSIP number as soon as practicable.
Each such communication by the Company shall
constitute a representation and warranty by
the Company to Deutsche Bank and the
Presenting Agent that (i) such Note is then,
and at the time of issuance and sale thereof
will be, duly authorized for issuance and
sale by the Company, (ii) such Note, and the
Global Security representing such Note, will
conform with the terms of the Indenture for
such Note, and (iii) upon authentication and
delivery of such Global Security, the
aggregate initial offering price of all
Notes issued under the Indenture will not
exceed $200,000,000 (except for Book-Entry
Notes represented by Global Securities
authenticated and delivered in exchange for
or in lieu of Global Securities pursuant to
the Indenture).
C. Deutsche Bank will enter a pending deposit
message through DTC's Participant Terminal
System providing the following settlement
information to DTC (which shall route such
information to Standard & Poor's
Corporation) and the Presenting Agent:
1. The information set forth in Settlement
Procedure "A".
2. Initial Interest Payment Date for such
Book-Entry Note, number of days by which
such date succeeds the related Regular
Record Date and amount of interest payable
on such Interest Payment Date.
3. CUSIP number of the Global Security
representing such Book-Entry Note.
4. Whether such Global Security will
represent any other Book-Entry Note (to
the extent known at such time).
D. To the extent the Company has not already
done so, the Company will deliver to the
Trustee a Global Security in a form that has
been approved by the Company, the Agent and
the
A-10
Trustee.
E. The Trustee will complete such Book-Entry
Note, stamp the appropriate legend, as
instructed by DTC, if not already set forth
thereon, and authenticate the Global
Security representing such Book-Entry Note.
F. DTC will credit such Book-Entry Note to
Deutsche Bank's participant account at DTC.
G. Deutsche Bank will enter an SDFS deliver
order through DTC's Participant Terminal
System instructing DTC to (i) debit such
Book-Entry Note to Deutsche Bank's
participant account and credit such
Book-Entry Note to the Presenting Agent's
participant account and (ii) debit the
Presenting Agent's settlement account and
credit Deutsche Bank's settlement account
for an amount equal to the price of such
Book-Entry Note less the Presenting Agent's
commission. The entry of such a deliver
order shall constitute a representation and
warranty by Deutsche Bank to DTC that (i)
the Global Security representing such
Book-Entry Note has been issued and
authenticated and (ii) Deutsche Bank is
holding such Global Security pursuant to the
Medium-Term Note Certificate Agreement
between Deutsche Bank and DTC.
H. The Presenting Agent will enter an SDFS
deliver order through DTC's Participant
Terminal System instructing DTC (i) to
debit such Book-Entry Note to the
Presenting Agent's participant account
and credit such Book-Entry Note to the
participant accounts of the Participants
with respect to such Book-Entry Note and
(ii) to debit the settlement accounts of
such Participants and credit the settlement
account of the Presenting Agent for an
amount equal to the price of such
Book-Entry Note.
I. Transfers of funds in accordance with
SDFS deliver orders described in Settlement
Procedures "G" and "H" will be settled in
accordance with SDFS operating procedures in
effect on the settlement date.
J. Deutsche Bank will, upon receipt of funds
from the Presenting Agent in accordance with
Settlement Procedure "G", credit to an
account of the Company (Account
# 500-15-307) maintained at Deutsche Bank
funds available for immediate use in the
amount transferred to Deutsche Bank in
accordance with Settlement Procedure
"G".
A-11
K. The Presenting Agent will confirm the
purchase of such Book-Entry Note to the
purchaser either by transmitting to the
Participants with respect to such
Book-Entry Note a confirmation order or
orders through DTC's institutional delivery
system or by mailing a written confirmation
to such purchaser.
Settlement Procedures For orders of Book-Entry Notes solicited by the
Timetable: Agent and accepted by the Company for settlement
on the first Business Day after the sale date,
Settlement Procedures "A" through "K" set forth
above shall be completed as soon as possible but
not later than the respective times (New York
City time) set forth below:
Settlement
Procedure Time
--------- ----
A 11:00 A.M. on the sale date
B 12:00 Noon on the sale date
C 2:00 P.M. on the sale date
D 3:00 P.M. on the day before settlement
E 9:00 A.M. on settlement date
F 10:00 A.M. on settlement date
G-H 2:00 P.M. on settlement date
I 4:45 P.M. on settlement date
J-K 5:00 P.M. on settlement date
If a sale is to be settled more than one Business
Day after the sale date, Settlement Procedures
"A", "B" and "C" shall be completed as soon as
practicable but no later than 11:00 A.M. and
12:00 Noon on the first Business Day after the
sale date and no later than 2:00 P.M. on the
Business Day before the settlement date,
respectively. Settlement Procedure "I" is subject
to extension in accordance with any extension of
Fedwire closing deadlines and in the other events
specified in SDFS operating procedures in effect
on the settlement date.
If settlement of a Book-Entry Note is rescheduled
or cancelled, Deutsche Bank will deliver to DTC,
through DTC's Participant Terminal System, a
cancellation message to such effect by no later
than 2:00 P.M. on the Business Day immediately
preceding the scheduled settlement date.
Failure to Settle: If Deutsche Bank fails to enter an SDFS deliver
order with respect to a Book-Entry Note pursuant
to Settlement Procedure "G", Deutsche Bank may
deliver to DTC, through DTC's Participant
Terminal System, as soon as practicable, a
withdrawal message instructing DTC to debit such
Book-Entry Note to Deutsche Bank's participant
account. DTC will process the withdrawal
message, provided that Deutsche Bank's particpant
account contains a principal amount of the Global
Security
A-12
representing such Book-Entry Note that is at
least equal to the principal amount to be
debited. If a withdrawal message is processed
with respect to all the Book-Entry Notes
represented by a Global Security, the Trustee
will cancel such Global Security in accordance
with the Indenture and so advise the Company and
will make appropriate entries in its records.
The CUSIP number assigned to such Global Security
shall, in accordance with CUSIP Service Bureau
procedures, be canceled and not immediately
reassigned. If a withdrawal message is processed
with respect to one or more, but not all, of the
Book-Entry Notes represented by a Global
Security, Deutsche Bank will exchange such
Book-Entry Note for two Global Securities, one of
which shall represent such Book-Entry Notes and
shall be cancelled immediately after issuance and
the other of which shall represent the other
Book-Entry Notes previously represented by the
surrendered Global Security and shall bear the
CUSIP number of the surrendered Global Security.
If the purchase price for any Book-Entry Note is
not timely paid to the Participants with respect
to such Note by the beneficial purchaser thereof
(or a Person, including an indirect participant
in DTC, acting on behalf of such purchaser), such
Participants and, in turn, the Presenting Agent
may enter SDFS deliver orders through DTC's
Participant Terminal System reversing the orders
entered pursuant to Settlement Procedures "H" and
"G", respectively. The Presenting Agent will
notify the Company by telephone of such failure.
Thereafter, Deutsche Bank will deliver the
withdrawal message and take the related actions
described in the preceding paragraph.
Notwithstanding the foregoing, upon any failure
to settle with respect to a Book-Entry Note, DTC
may take any actions in accordance with its SDFS
operating procedures then in effect. In the event
of a failure to settle with respect to one or
more, but not all, of the Book-Entry Notes to
have been represented by a Global Security,
Deutsche Bank will provide, in accordance with
Settlement Procedure "E", for the authentication
and issuance of a Global Security representing
the other Book-Entry Notes to have been
represented by such Global Security and will make
appropriate entries in its records.
Deutsche Bank Not to Nothing herein shall be deemed to require
Risk Funds: Deutsche Bank to risk or expend its own funds in
connection with any payment to the Company, DTC,
the Agent or the purchaser, it being understood
by all parties that payment made by Deutsche Bank
to the Company, DTC, the Agent or the purchaser
shall be made only to the extent that funds are
provided to Deutsche Bank for such purpose.
Authenticity The Company will cause Deutsche Bank to furnish
of Signatures: the Agent from time to time with the specimen
signatures of each of Deutsche Bank's officers,
employees or agents who have been authorized by
Deutsche
A-13
Bank to authenticate Book-Entry Notes, but the
Agent will have no obligation or liability to the
Company or Deutsche Bank in respect of the
authenticity of the signature of any officer,
employee or agent of the Company or Deutsche Bank
on any Book-Entry Note.
Advertising Costs: The Company will determine with the Agent the
amount of advertising that may be appropriate in
soliciting offers to purchase the Book-Entry
Notes. Advertising expenses will be paid by the
Company.
Periodic Statements from Periodically, Deutsche Bank will send to the
Deutsche Bank: Company a statement setting forth the principal
amount of Book-Entry Notes outstanding as of that
date and setting forth a brief description of any
sales of Book-Entry Notes of which the Company
has advised Deutsche Bank but which have not yet
been settled.
A-14
EXHIBIT B
Idaho Power Company
First Mortgage Bonds,
Secured Medium Term Notes, Series D
Due from Nine Months
to Thirty Years from Date of Issue
TERMS AGREEMENT
Idaho Power Company
▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇.
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention:
Subject in all respects to the terms and conditions of the Selling
Agency Agreement (the "Agreement") dated November 12, 2002, between [Agent], and
you, the undersigned agrees to purchase the following Notes of Idaho Power
Company:
[Add additional terms as may be needed to identify Notes.]
Aggregate Principal Amount: $
Issue Date:
Original Interest Accrual Date:
Interest Rate:
Maturity Date:
Interest Payment Dates:
Regular Record Dates:
Discount or Commission: % of Principal Amount
Purchase Price: % of Principal Amount [plus accrued
interest from __________, 20__]
Settlement Date:
Price to Public:
Purchase Date and Time:
Place for Delivery of Notes
and Payment Therefor:
Method of Payment: [same day funds]
Redemption Provisions, if any:
Modification, if any, in the
requirements to deliver the
documents specified in Section 6(b)
of the Agreement:
Period during which additional
Notes may not be sold pursuant to
Section 4(1) of the Agreement:
Syndicate Provisions:
(Set forth any provisions relating to
underwriters' default and step-up of
amounts to be purchased.)
This Agreement shall be governed by and construed in accordance with the laws of
the State of New York.
[Purchaser]
By:
----------------------------
Accepted:
Idaho Power Company
By:
---------------------------------
Title:
B-2
EXHIBIT C
Pursuant to Section 5(e) of the Selling Agency Agreement, the
accountants shall furnish a letter to the Agent to the effect that:
(i) They are independent certified public accountants with respect to
the Company and its subsidiaries within the meaning of the Act and the
applicable rules and regulations thereunder adopted by the SEC;
(ii) In their opinion, the consolidated financial statements and
consolidated financial statement schedules audited by them and included or
incorporated by reference in the Registration Statement or the Prospectus comply
as to form in all material respects with the applicable accounting requirements
of the Act or the Exchange Act, as applicable, and the related rules and
regulations adopted by the SEC, and, if applicable, they have performed the
procedures specified by the American Institute of Certified Public Accountants
for a review of interim financial information as described in SAS No. 71,
Interim Financial Information, on the consolidated interim financial statements
for the periods specified in such letter, as indicated in their reports thereon,
copies of which have been furnished to the Agent;
(iii) The unaudited selected financial information with respect to the
consolidated results of operations and financial position of the Company for the
five most recent fiscal years included or incorporated by reference in the
Prospectus and included or incorporated by reference in item 6 of the Company's
Annual Report on Form 10-K for the most recent fiscal year agrees with the
corresponding amounts (after restatement where applicable) in the audited
consolidated financial statements for the five such fiscal years which were
included or incorporated by reference in the Company's Annual Reports on Form
10-K for such fiscal years;
(iv) On the basis of limited procedures, not constituting an audit in
accordance with generally accepted auditing standards, consisting of a reading
of the unaudited financial statements and other information referred to below, a
reading of the latest available interim financial statements of the Company and
its subsidiaries, inspection of the minute books of the Company and its
subsidiaries since the date of the latest audited financial statements included
or incorporated by reference in the Prospectus, inquiries of officials of the
Company and its subsidiaries responsible for financial and accounting matters
and such other inquiries and procedures as may be specified in such letter,
nothing has come to their attention that caused them to believe that:
(A) the unaudited consolidated statements of income, consolidated
statements of comprehensive income, consolidated balance sheets,
consolidated statements of cash flows and consolidated statements of
capitalization included or incorporated by reference in the Company's
Quarterly Reports on Form 10-Q incorporated by reference in the Prospectus
do not comply as to form in all material respects with the applicable
accounting requirements of the Exchange Act as it applies to Form 10-Q and
the related rules and regulations adopted by the SEC;
(B) any material modifications should be made to the unaudited
consolidated financial statements described in (A), included or
incorporated by reference in the Prospectus, for them to be in conformity
with generally accepted accounting principles;
(C) as of a specified date not more than five days prior to the date
of such letter, there have been any changes in the consolidated capital
stock (except for shares of 4% preferred stock) or any increase in the
consolidated long-term debt of the Company and its subsidiaries, or any
decreases in consolidated net assets or other items specified by the Agent,
in each case as compared with amounts shown in the latest balance sheet
included or incorporated by reference in the Prospectus, except in each
case for changes, increases or decreases which the Prospectus discloses
have occurred or may occur, for declarations of dividends, or which are
described in such letter; and
(D) for the period from the date of the latest financial statements
included or incorporated by reference in the Prospectus to the specified
date referred to in Clause (C) there were any decreases in consolidated
revenues, net income or earnings on common stock or other items specified
by the Agent, or any increases in any items specified by the Agent, in each
case as compared with the comparable period of the preceding year and with
any other period of corresponding length specified by the Agent, except in
each case for increases or decreases which the Prospectus discloses have
occurred or may occur, for declarations of dividends, or which are
described in such letter; and
(v) In addition to the audit referred to in their report(s) included
or incorporated by reference in the Prospectus and the limited procedures,
inspection of minute books, inquiries and other procedures referred to in
paragraphs (ii) and (iv) above, they have carried out certain specified
procedures, not constituting an audit in accordance with generally accepted
auditing standards, with respect to certain amounts, percentages and financial
information specified by the Agent which are derived from the general accounting
records of the Company and its subsidiaries, which appear in the Prospectus
(excluding documents incorporated by reference), or in Part II of, or in
exhibits and schedules to, the Registration Statement specified by the Agent or
in documents incorporated by reference in the Prospectus specified by the Agent,
and have compared certain of such amounts, percentages and financial information
with the accounting records of the Company and its subsidiaries and have found
them to be in agreement, except as described in such letter.
All references in this Exhibit C to the Prospectus shall be deemed to
refer to the Prospectus (including the documents incorporated by reference
therein) as amended or supplemented (including the documents incorporated by
reference therein) in relation to the Notes for purposes of the letter delivered
at the Closing Date for such Notes.
C-2
EXHIBIT D
__________, 20__
To the Agent referred to in the
Selling Agency Agreement
Relating to:
$200,000,000 Principal Amount of
First Mortgage Bonds, Secured Medium-
Term Notes, Series D, of Idaho Power Company
Ladies and Gentlemen:
With reference to the issuance and sale by Idaho Power Company, an
Idaho corporation (the "Company"), pursuant to the Selling Agency Agreement,
dated ______, 2002 (the "Agency Agreement"), between the Company and you of up
to $200,000,000 aggregate principal amount of First Mortgage Bonds, Secured
Medium-Term Notes, Series D (the "Notes"), to be issued under the Company's
Indenture of Mortgage and Deed of Trust, dated as of October 1, 1937, between
the Company and Deutsche Bank Trust Company Americas, formerly known as Bankers
Trust Company and R. G. Page, as Trustees (▇▇▇▇▇▇▇ ▇▇▇▇, successor individual
trustee) (the "Trustees"), as supplemented by all indentures supplemental
thereto, the latest such supplemental indenture being the Thirty-sixth
Supplemental Indenture, dated as of October 1, 2001 (said Indenture of Mortgage
and Deed of Trust, as so supplemented, being hereinafter called the "Mortgage"),
we advise you that we are counsel to the Company and in that capacity have
reviewed or participated in the preparation of (1) the Mortgage; (2) the
registration statement (File No. 333-67748) relating to the Notes filed with the
Securities and Exchange Commission (the "Commission") under the Securities Act
of 1933, as amended (the "Act") (said registration statement, as amended to the
date of effectiveness, including the documents incorporated by reference therein
as of such date pursuant to Item 12 of Form S-3 (the "Incorporated Documents")
being hereinafter called the "Registration Statement"); (3) the prospectus,
dated August 27, 2001 (the "Base Prospectus"), as supplemented by a prospectus
supplement relating to the Notes, dated October 1, 2001 (the "Prospectus
Supplement") (such prospectus, as so supplemented, including the incorporated
documents, being hereinafter referred to as the "Prospectus"); (4) the Agency
Agreement and (5) the Bond Application, dated October 1, 2001 for authentication
and delivery of the Notes in an aggregate principal amount not to exceed
$200,000,000 (the "Bond Application"). Terms not otherwise defined herein shall
have the meanings given to them in the Agency Agreement.
We have reviewed such corporate records, certificates and other
documents as we have considered necessary or appropriate for purposes of this
opinion.
Upon the basis of such review, we are of the opinion that:
(1) The Mortgage has been duly authorized, executed and delivered by
the Company, is a legal, valid and binding instrument enforceable in accordance
with its terms, subject to bankruptcy, insolvency, reorganization or other laws
of general applicability relating to or affecting mortgagees' and other
creditors' rights, and to general principles of equity
(whether considered in a proceeding at law or in equity) and has been qualified
under the Trust Indenture Act of 1939, as amended.
(2) The Notes, when issued and paid for as contemplated in the Agency
Agreement, will be legal, valid and binding obligations of the Company
enforceable in accordance with their terms and entitled to the benefit of the
security provided by the Mortgage, subject to bankruptcy, insolvency,
reorganization or other laws of general applicability relating to or affecting
mortgagees' and other creditors' rights and to general principles of equity
(whether considered in a proceeding at law or in equity).
(3) The Agency Agreement has been duly authorized, executed and
delivered by the Company.
(4) The Registration Statement, as of its effective date, and the Base
Prospectus, as supplemented by the Prospectus Supplement, as of the date of the
Prospectus Supplement, complied as to form in all material respects with the
applicable requirements of the Act and the Securities Exchange Act of 1934, as
amended, and the applicable instructions, rules and regulations of the
Commission thereunder; the Registration Statement is effective under the Act;
and, to the best of our knowledge, no proceedings for a stop order with respect
thereto are pending or threatened under Section 8(d) of the Act.
(5) All regulatory consents and approvals required to be obtained by
the Company from any governmental body or bodies in connection with the
Company's issuance and sale of the Notes in the manner set forth in the Agency
Agreement have been obtained and are in effect, except that the order of the
Idaho Public Utilities Commission grants authority to sell the Notes through
September 14, 2003; it being understood that we express no opinion as to any
consents or approvals required to be obtained, or other actions required to be
taken, under the securities or blue sky laws of any jurisdiction.
In passing upon the form of the Registration Statement and the form of
the Base Prospectus, as supplemented by the Prospectus Supplement, we
necessarily assume the correctness and completeness of the representations made
to us and the statements made to us or included in the Registration Statement
and the Base Prospectus, as supplemented by the Prospectus Supplement, by the
Company and take no responsibility therefor. In the course of the preparation by
the Company of the Registration Statement and the Base Prospectus, we had
conferences with certain of its officers and representatives, with other counsel
for the Company and with Deloitte & Touche LLP, the independent certified public
accountants who examined certain of the financial statements included or
incorporated by reference in the Registration Statement. Our examination of the
Registration Statement and the Base Prospectus, as supplemented by the
Prospectus Supplement, and our discussions in the above-mentioned conferences
did not disclose to us any information which gives us reason to believe that, at
the effective date, the Registration Statement contained any untrue statement of
a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or that the
Base Prospectus, as supplemented by the Prospectus Supplement, as of the date of
the Prospectus Supplement, contained any untrue statement of a material fact or
omitted 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. Also, nothing that
D-2
has come to our attention in the course of our examination of the Registration
Statement or the Prospectus or in our discussions in the above-mentioned
conferences that has caused us to believe that the Prospectus, as of the date
and time of the delivery of this letter, contained any untrue statement of a
material fact or omitted 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. We do not express any opinion or belief as to the
financial statements or other financial data contained or incorporated by
reference in the Registration Statement or the Prospectus.
We express no opinion as to the law of any jurisdiction other than the
law of the State of New York and the federal laws of the United States. As to
all matters of Idaho law and as to the matters set forth in paragraph 5 above,
we have relied upon an opinion of even date herewith addressed to you by ▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇, Esq., General Counsel for the Company. We are not passing upon
matters relating to the incorporation of the Company, titles to property, liens,
licenses, franchises, water rights or conformity to the laws of the States of
Idaho, Montana, Nevada, Oregon or Wyoming, or upon questions of the recording
of, or the validity or priority of the lien of, the Mortgage.
Very truly yours,
LeBoeuf, ▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, L.L.P.
D-3
EXHIBIT E
_________, 20__
To the Agent referred to in the
Selling Agency Agreement
Relating to:
$200,000,000 Principal Amount of
First Mortgage Bonds, Secured Medium-
Term Notes, Series D, of Idaho Power Company
Ladies and Gentlemen:
In connection with the issuance and sale pursuant to the Selling
Agency Agreement, dated ______, 2002 (the "Agency Agreement"), between Idaho
Power Company, an Idaho corporation (the "Company"), and you of up to
$200,000,000 aggregate principal amount of the Company's First Mortgage Bonds,
Secured Medium-Term Notes, Series D (the "Notes"), to be issued under an
Indenture of Mortgage and Deed of Trust, dated as of October 1, 1937, between
the Company and Deutsche Bank Trust Company Americas, formerly known as Bankers
Trust Company and R. G. Page, as Trustees (▇▇▇▇▇▇▇ ▇▇▇▇, successor individual
trustee) (the "Trustees"), as supplemented by all indentures supplemental
thereto, the latest such supplemental indenture being the Thirty-sixth
Supplemental Indenture, dated as of October 1, 2001 between the Company and the
Trustees (collectively, the "Mortgage"), I am the Company's General Counsel, and
I am familiar with its legal status and that of its property. I am also familiar
with the registration statement (File No. 333-67748) filed under the Securities
Act of 1933, as amended (the "Act"), with the Securities and Exchange Commission
(such registration statement as amended to the date of effectiveness, including
the documents incorporated by reference therein as of such date pursuant to Item
12 of Form S-3 (the "Incorporated Documents") being hereinafter referred to as
the "Registration Statement"), the prospectus, dated August 27, 2001 (the "Base
Prospectus"), as supplemented by a prospectus supplement relating to the Notes,
dated October 1, 2001 (the "Prospectus Supplement") (such prospectus, as so
supplemented, including the incorporated documents, being hereinafter referred
to as the "Prospectus"), the Agency Agreement and the Bond Application, dated
October 1, 2001 for authentication and delivery of Notes in an aggregate
principal amount not to exceed $200,000,000 (the "Bond Application"). Terms not
otherwise defined herein shall have the meanings given to them in the Agency
Agreement.
I have made such examination of corporate and other records and
documents and of matters of law as in my opinion are necessary or desirable for
the purpose of this opinion, and based ▇▇▇▇▇▇▇, I am of the opinion that:
(1) The Company has been duly incorporated and is validly existing and
in good standing under the laws of the State of Idaho, and has full power and
authority to own its properties and conduct its business in all material
respects as described in the Prospectus as amended or supplemented;
(2) To the best of my knowledge and other than as set forth in the
Prospectus as amended or supplemented, there are no legal or governmental
proceedings pending to which the Company or any of its subsidiaries is a party
or of which any property of the Company or any of its subsidiaries is the
subject which would individually or in the aggregate have a material adverse
effect on the consolidated financial position or results of operations of the
Company and its subsidiaries considered as a whole; and, to the best of my
knowledge, no such proceedings are threatened or contemplated by governmental
authorities or threatened by others;
(3) The Agency Agreement has been duly authorized, executed and
delivered by the Company;
(4) The Notes, when issued and paid for as contemplated in the Agency
Agreement, will be legal, valid and binding obligations of the Company,
enforceable in accordance with their terms and entitled to the benefit of the
security provided by the Mortgage, subject to bankruptcy, insolvency,
reorganization or other laws of general applicability relating to or affecting
mortgagees' and other creditors' rights and to general principles of equity
(whether considered in a proceeding at law or in equity); and the Notes and the
Mortgage conform to the descriptions thereof in the Prospectus as amended or
supplemented;
(5) The Mortgage has been duly authorized, executed and delivered by
the Company and constitutes a valid lien to the extent that it purports to be
one upon the property described therein as being subject to the lien thereof
(except any which has been duly released from the lien thereof) and is a legal,
valid and binding instrument, enforceable in accordance with its terms, subject
to bankruptcy, insolvency, reorganization or other laws of general applicability
relating to or affecting mortgagees' and other creditors' rights and to general
principles of equity (whether considered in a proceeding at law or in equity);
said Mortgage has been duly recorded and filed in such manner and in such places
as are required by law in order to establish, preserve and protect the lien of
said Mortgage;
(6) The issue and sale of the Notes in an aggregate principal amount
not to exceed the amount set forth in the Bond Application and the compliance by
the Company with all of the provisions of the Notes, the Mortgage and the Agency
Agreement with respect to the Notes and the consummation of the transactions
therein contemplated will not conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company is a party or by which the Company is bound or
to which any of the property or assets of the Company is subject, nor will such
actions result in any violation of the provisions of the Restated Articles of
Incorporation, as amended or By-laws, as amended, of the Company or any statute
or any order, rule or regulation of any court or governmental agency or body
having jurisdiction over the Company or any of its properties;
(7) The description of the Company's property in the Mortgage is
adequate to constitute the Mortgage a lien thereon. The Company has good and
marketable fee title to all real property upon which the Mortgage purports to
create a lien, except water rights, leases, licenses, franchises, easements and
other interests in real property of a similar nature, as to which it has good
and valid title, in each case free and clear of all liens, charges and
encumbrances other than excepted encumbrances as defined in the Mortgage and the
lien of the Mortgage,
E-2
subject to minor defects and clouds common to property of the size and character
of that of the Company. Such minor defects and clouds are in my opinion not
important and do not materially interfere with the operations of the Company or
materially detract from the value of its property;
(8) The Company has such valid franchises, permits, licenses,
easements and consents, free from burdensome restrictions, as are required by
law for the operation of the Company's system and as are required for the
adequate conduct of its business in the territory which it serves;
(9) The Registration Statement, as of its effective date, and the Base
Prospectus, as supplemented by the Prospectus Supplement, as of the date of the
Prospectus Supplement, complied as to form in all material respects with the
requirements of the Act and the Securities Exchange Act of 1934, as amended, and
the applicable instructions, rules and regulations of the Securities and
Exchange Commission thereunder; the Registration Statement is effective under
the Act; and, to the best of my knowledge, no proceedings for a stop order with
respect thereto are pending or threatened under Section 8(d) of the Act; and
(10) All regulatory consents and approvals required to be obtained by
the Company from any governmental body or bodies in connection with the
Company's issuance and sale of the Notes in the manner set forth in the Agency
Agreement have been obtained and are in effect, except that the order of the
Idaho Public Utilities Commission grants authority to sell the Notes through
September 14, 2003; it being understood that I express no opinion as to any
consents or approvals required to be obtained, or other actions required to be
taken, under state securities or Blue Sky laws of any jurisdiction.
I have no reason to believe that the Registration Statement, at the
effective date, contained any untrue statement of a material fact or omitted to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Base Prospectus, as supplemented
by the Prospectus Supplement, as of the date of the Prospectus Supplement,
contained any untrue statement of a material fact or omitted 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; it being understood
that I express no opinion or belief as to the financial statements or other
financial data contained or incorporated by reference in the Registration
Statement or the Prospectus. Also, nothing that has come to my attention in the
course of my examination of the Registration Statement or the Prospectus that
has caused me to believe that the Prospectus, as of the date and time of the
delivery of this letter, contained any untrue statement of a material fact or
omitted 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.
Very truly yours,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
E-3