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
October 1, 2001
ABN AMRO Incorporated
55 East 52nd Street
New York, NY 10055
Banc of America Securities LLC
Bank of America Corporate Center
100 North Tryon Street
Charlotte, NC 28255
Banc One Capital Markets, Inc.
One Bank One Plaza
Suite IL1-0595
Chicago, IL 60670
BNY Capital Markets, Inc.
One Wall Street, 18th Floor
New York, NY 10286
Goldman, Sachs & Co.
85 Broad Street
New York, NY 10004
McDonald Investments Inc.
800 Superior Avenue
Cleveland, OH 44114
U.S. Bancorp Piper Jaffray Inc.
111 SW Fifth Avenue, Suite 1900
Portland, OR 97204
Wells Fargo Brokerage Services, LLC
608 Second Avenue South, Suite 900
MAC N9303-097
Minneapolis, MN 55479
Ladies and Gentlemen:
Idaho Power Company, an Idaho corporation (the "Company"), confirms its
agreement with each of 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
Bankers Trust Company, (the "Trustee") and R.G. Page (Stanley Burg, 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 any of you acting solely in the capacity as
agent for the Company pursuant to Section 2(a) and not as principal
(collectively, the "Agents"), the term "Purchaser" shall refer to one of you
acting solely as principal pursuant to Section 2(b) and not as agent, and the
term "you" shall refer to you collectively whether at any time any of you is
acting in both such capacities or in either such capacity. In acting under this
Agreement, in whatever capacity, each of you is acting individually and not
jointly.
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
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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 conformity with information
furnished in writing to the Company by any of 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
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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 Agents.
(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 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 Agents; Solicitation by the Agents 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 each of the
Agents 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, each of the Agents 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. Each Agent shall make reasonable efforts to assist the Company in
obtaining performance by each purchaser whose offer to purchase Notes has been
solicited by such Agent and accepted by the Company, but such 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 any Agent be obligated to
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purchase any Notes for its own account. It is understood and agreed, however,
that if approved by the Company any Agent may purchase Notes as principal
pursuant to Section 2(b).
Each 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. Each 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
Agents 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 Agents will forthwith suspend solicitation of offers to purchase
Notes from the Company until such time as the Company has advised them that such
solicitation may be resumed.
The Company agrees to pay each Agent a commission, for such Agent's
services in acting as an agent and not for a purchase by such 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 such 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.
The Company may from time to time offer Securities or Notes for sale
otherwise than through an Agent 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 an Agent, except that the Company may accept
offers to purchase Notes through an agent other than an Agent if the Company
gives the Agents 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 each
of 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 any of you determine that the Company shall sell Notes directly to any of
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
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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 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. Each 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 each of you
through your counsel a copy for your review prior to filing and given each of
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 each of 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
6
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 each of you to suspend
solicitation of offers to purchase Notes (and, if so notified by the Company,
each of 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 supplemented Prospectus to each of 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 each of you copies of such
documents.
(d) As soon as practicable, the Company will make generally available to
its security holders and to each of 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 each of 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 any of 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.
7
(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 each of 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 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 each of 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.
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(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 the
reasonable judgment of any of you, 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 each
of 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 each of 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 each of 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).
(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 each of 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 each of 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 each of 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 the
reasonable judgment of any of you, 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 Agents
9
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 Agents 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 Agents,
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 each
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 any of the Agents 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 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 any such 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 Agents. The obligations of each
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 each Agent the opinions of LeBoeuf,
Lamb, Greene & MacRae, L.L.P., counsel to the Company and Robert W. Stahman,
Esq., General Counsel for the Company, dated the Execution Time substantially in
the forms of Exhibits D and E hereto.
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(c) Each Agent shall have received from Sullivan & Cromwell, counsel for
the Agents, 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 Agents 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, Sullivan & Cromwell may rely upon the opinion
described above of Robert W. Stahman, 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 each 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 Agents to solicit offers to purchase the Notes;
(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 each
Agent a letter or letters (which may refer to letters previously delivered to
the Agents), 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 each
Agent such further information, documents and certificates as the Agents 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 such Agents and counsel for the Agents, this Agreement and all
obligations of any Agent hereunder may be cancelled at any time by the
11
Agents. 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, Greene & MacRae, 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, Greene & MacRae, L.L.P., and Robert W. Stahman, Esq.,
counsel for the Company, dated as of the Closing Date, to the effect referred to
in Section 5(b), (iii) the opinion(s) of Sullivan & Cromwell, 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 and hold harmless
each of you 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
12
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 each
of 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 any of 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.
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 any of you within the meaning of the Act.
(b) Each of you severally and not jointly 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.
13
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 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 each of 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
each of 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 each of 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 any of 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 each of 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
14
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. The obligations of each of you 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 any Agent or by any of you insofar as this Agreement
relates to any Agent, by giving written notice of such termination to such 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 in the rating of any of the Company's first mortgage
bonds by Moody's 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)
15
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 any of you, will be mailed, delivered or
telegraphed and confirmed to such of 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 1221 W. Idaho Street, Boise, Idaho 83702-5627, 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.
16
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 among the Company
and you.
Very truly yours,
IDAHO POWER COMPANY
By: /s/ Darrel T. Anderson
-----------------------------------
Darrel T. Anderson
Vice President -
Finance and Chief
Accounting Officer
The foregoing Agreement is
hereby confirmed and accepted
as of the date hereof.
ABN AMRO INCORPORATED
By: /s/ Linda A. Dawson
_______________________________
Name: Linda A. Dawson
Title: Managing Director
BANC OF AMERICA SECURITIES LLC
By: /s/ Lily Chang
_______________________________
Name: Lily Chang
Title: Principal
BANC ONE CAPITAL MARKETS, INC.
By: /s/ Donald J. Donahue
_______________________________
Name: Donald J. Donahue
Title: Managing Director
BNY CAPITAL MARKETS, INC.
By: /s/ Daniel Klinger
_______________________________
Name: Daniel Klinger
Title: Vice Principal
GOLDMAN, SACHS & CO.
By: /s/ Goldman, Sachs & Co.
_______________________________
(Goldman, Sachs & Co.)
MCDONALD INVESTMENTS INC.
By: /s/ Richard A. Pohle
_______________________________
Name: Richard A. Pohle
Title: Senior Vice President
U.S. BANCORP PIPER JAFFRAY INC.
By: /s/ Robert A. Krueger
_______________________________
Name: Robert A. Krueger
Title: Managing Director
WELLS FARGO BROKERAGE SERVICES, LLC
By: /s/ Joseph W. Glenn
_______________________________
Name: Joseph W. Glenn
Title: Vice President
SCHEDULE I
Commissions:
The Company agrees to pay each Agent a commission equal to the following
percentage of the principal amount of each Note sold on an agency basis by such
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 Agents:
Notices to (1) ABN AMRO Incorporated shall be directed to it at 55
East 52nd Street, New York, NY 10055
Attention of Legal Department
Tel: 212-409-1000
Fax: 212-409-7303
Notices to (2) Banc of America Securities LLC shall be directed to it
at Bank of America Corporate Center, 100 North Tryon Street,
Charlotte, NC 28255
Attention of MTN Desk
Tel: 704-388-4809
Fax: 704-388-9939
Notices to (3) Banc One Capital Markets, Inc. shall be directed to it
at One Bank One Plaza, Suite IL1-0595, Chicago, IL 60670
Attention of Investment Grade Securities
Tel: 312-732-7259
Fax: 312-732-4773
Notices to (4) The BNY Capital Markets, Inc. shall be directed to it
at One Wall Street, 18th floor, New York, NY 10286
Attention of Dan Klinger
Tel: 212-635-8974
Fax: 212-635-8525
Notices to (5) Goldman, Sachs & Co. shall be directed to it at 85
Broad Street, New York, NY 10004
Attention of Ben Smilchensky
Tel: 212-902-1482
Fax: 212-902-0658
Notices to (6) McDonald Investments Inc. shall be directed to it at
800 Superior Avenue, Cleveland, OH 44114
Attention of Andrew T. Redinger
Tel: 216-443-2305
Fax: 216-443-2993
Notices to (7) U.S. Bancorp Piper Jaffray Inc. shall be directed to it
at 111 SW Fifth Avenue, Suite 1900, Portland, OR 97204
Attention of Mike Malmquist
Corporate Finance
Tel: 503-275-4131
Fax: 503-275-3490
Notices to (8) Wells Fargo Brokerage Services, LLC shall be directed
to it at 608 Second Avenue South, Suite 900, MAC N9303-097,
Minneapolis, MN 55479
Attention of Joseph W. Glenn
Tel: 612-667-3774
Fax: 612-667-4774
2
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. ABN AMRO
Incorporated, Banc of America Securities LLC, Banc One Capital Markets, Inc.,
BNY Capital Markets, Inc., Goldman, Sachs & Co., McDonald Investments Inc., U.S.
Bancorp Piper Jaffray Inc. and Wells Fargo Brokerage Services, LLC, as agents
(each an "Agent"), have agreed to use their reasonable best efforts to solicit
purchases of Notes issued in fully registered form. The Agents will not be
obligated to purchase Notes for their own account. The Notes are being sold
pursuant to a Selling Agency Agreement between the Company and the agents named
therein (including the Agents) 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
Bankers Trust Company (the "Trustee") and R.G. Page (Stanley Burg, 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 an 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 such Agent
acting solely as principal, unless otherwise agreed to between the Company and
such Agent acting as principal.
Each Note will be represented by a Global Security (as defined hereinafter)
delivered to Bankers Trust Company ("Bankers Trust") 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 Agents 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 Agents and the Trustee in writing of those persons handling
administrative responsibilities with whom the Agents 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, Bankers Trust 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 Bankers Trust to DTC dated as of October 1,
2001 and a Medium-Term Note Certificate Agreement between Bankers Trust 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 The Company has arranged with the CUSIP Service Bureau of
Numbers: 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. Bankers Trust, the Company and DTC have obtained
from the CUSIP Service Bureau a written list of such reserved
CUSIP numbers. Bankers Trust 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 Bankers Trust has assigned to Global Securities.
Bankers Trust will notify the Company at any time when fewer than
100 of the
A-2
reserved CUSIP numbers remain unassigned to Global Securities,
and, if it deems necessary, the Company will reserve additional
CUSIP numbers for assignment to Global Securities. Upon obtaining
such additional CUSIP numbers, Bankers Trust 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, Bankers Trust 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
Bankers Trust) a written reorganization notice to the effect that
such exchange will occur on such date. Prior to the specified
exchange date, Bankers Trust 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
A-3
exchanged will no longer be valid. On the specified exchange
date, Bankers Trust will exchange such Global Securities for a
single Global 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,
A-4
the first interest payment will be made on the Interest Payment
Date following the next succeeding Regular Record Date.
Calculation Interest on Book-Entry Notes (including interest for partial
of Interest: periods) will be calculated on the basis of a 360-day year of
twelve 30-day months.
Payment of Payment of Interest Only. Promptly after each Regular Record
Principal and Date, Bankers Trust will deliver to the Company and DTC's
Interest: 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 Bankers Trust, as
paying agent, the total amount of interest due on such Interest
Payment Date (other than at Maturity), and Bankers Trust 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, Bankers Trust 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. Bankers Trust, 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
Bankers Trust, as paying agent, the principal amount of such
Global Security, together with interest due at such Maturity.
Bankers Trust 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, Bankers
Trust 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.
A-5
Manner of Payment. The total amount of any principal and interest
due on Global Securities on any Interest Payment Date or at
Maturity shall be paid by the Company to Bankers Trust in
immediately available funds on such date. The Company will make
such payment on such Global Securities by instructing Bankers
Trust to withdraw funds from an account (Account # 500-15-307)
maintained by the Company at Bankers Trust or by wire transfer to
Bankers Trust. The Company will confirm any such instructions in
writing to Bankers Trust. Prior to 10 A.M. (New York City time)
on the date of Maturity or as soon as possible thereafter,
Bankers Trust 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 Bankers Trust 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 Bankers Trust 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 Company Notice to Trustee Regarding Exercise of Optional
upon Company's Redemption. At least 35 days prior to the date on which it
Exercise intends to redeem a Book-Entry Note, the Company will notify the
of Optional Trustee that it is exercising such option with respect to such
Redemption: 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.
A-6
Deposit of Redemption Price. On or before any redemption date,
the Company shall deposit with such Trustee an amount of money
sufficient 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 The Company and the Agents will discuss from time to time the
Rate Setting aggregate principal amount of, the issuance price of, and the
and Posting: interest rates to be borne by, Book-Entry Notes that may be sold
as a result of the solicitation of orders by the Agents. If the
Company decides to set prices of, and rates borne by, any
Book-Entry Notes in respect of which the Agents are 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
Agents of the prices and rates to be posted.
Acceptance and Unless otherwise instructed by the Company, each Agent will
Rejection of advise the Company promptly by telephone of all orders to
Orders: purchase Book-Entry Notes received by such 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 Agents, 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 If any order to purchase a Book-Entry Note is accepted by or on
of Pricing behalf of the Company, the Company will prepare a pricing
Supplement: 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 the Agent which 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 The Company reserves the right, in its sole discretion, to
Solicitation; instruct the Agents to suspend at any time, for any period of
Amendment or time or permanently, the solicitation of orders to purchase
Supplement: Book-Entry Notes. Upon receipt of such instructions, the Agents
will forthwith suspend solicitation until such time as the
Company has advised them that such solicitation may
A-7
be resumed. 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 Agents and
Bankers Trust 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 Agents and furnish the Agents 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 Agents and Bankers Trust
with copies of any such supplement, and confirm to the Agents
that such supplement has been filed with the Commission pursuant
to the applicable paragraph of Rule 424(b).
Procedures For When the Company has determined to change the interest rates of
Rate Changes: Book-Entry Notes being offered, it will promptly advise the
Agents and the Agents will forthwith suspend solicitation of
orders. The Agents will telephone the Company with
recommendations as to the changed interest rates. At such time as
the Company has advised the Agents of the new interest rates, the
Agents 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 Supplement)
Prospectus: 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 Agents 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
A-8
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 an Agent).
Confirmation: For each order to purchase a Book-Entry Note solicited by any
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 Book-Entry Note sold by
Procedures: the Company through any 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.
A-9
12. Presenting Agent's commission, determined as provided
in Section 2 of the Agency Agreement and certification
that the purchasers were solicited solely by such
Agent.
13. Net proceeds to the Company.
B. Bankers Trust will assign a CUSIP number to the Global
Security representing such Book-Entry Note and the Company
will advise Bankers Trust 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.
Bankers Trust 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 Bankers Trust
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. Bankers Trust 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
A-10
that has been approved by the Company, the Agents and the
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 Bankers Trust's
participant account at DTC.
G. Bankers Trust will enter an SDFS deliver order through DTC's
Participant Terminal System instructing DTC to (i) debit
such Book-Entry Note to Bankers Trust'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 Bankers Trust'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 Bankers Trust to DTC that (i) the Global
Security representing such Book-Entry Note has been issued
and authenticated and (ii) Bankers Trust is holding such
Global Security pursuant to the Medium-Term Note Certificate
Agreement between Bankers Trust 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. Bankers Trust 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 Bankers Trust funds available for
immediate use in the amount transferred to Bankers Trust 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 For orders of Book-Entry Notes solicited by any Agent and
Procedures accepted by the Company for settlement on the first Business
Timetable: 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,
Bankers Trust 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 If Bankers Trust fails to enter an SDFS deliver order with
Settle: respect to a Book-Entry Note pursuant to Settlement Procedure
"G", Bankers Trust 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 Bankers Trust's
participant account. DTC will process the withdrawal message,
provided that Bankers Trust's participant account contains a
principal amount of the Global Security 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
A-12
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, Bankers Trust 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, Bankers Trust 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, Bankers Trust 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.
Bankers Trust Nothing herein shall be deemed to require Bankers Trust to risk
Not to Risk or expend its own funds in connection with any payment to the
Funds: Company, DTC, the Agents or the purchaser, it being understood by
all parties that payment made by Bankers Trust to the Company,
DTC, the Agents or the purchaser shall be made only to the extent
that funds are provided to Bankers Trust for such purpose.
Authenticity The Company will cause Bankers Trust to furnish the Agents from
of Signatures: time to time with the specimen signatures of each of Bankers
Trust's officers, employees or agents who have been authorized by
Bankers Trust to authenticate Book-Entry Notes, but the Agents
will have no obligation or liability to the Company or Bankers
Trust in respect of the
A-13
authenticity of the signature of any officer, employee or agent
of the Company or Bankers Trust on any Book-Entry Note.
Advertising The Company will determine with the Agents the amount of
Costs: advertising that may be appropriate in soliciting offers to
purchase the Book-Entry Notes. Advertising expenses will be paid
by the Company.
Periodic Periodically, Bankers Trust will send to the Company a statement
Statements setting forth the principal amount of Book-Entry Notes
from outstanding as of that date and setting forth a brief description
Bankers Trust: of any sales of Book-Entry Notes of which the Company has advised
Bankers Trust 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
1221 W. Idaho St.
Boise, Idaho 83702-5627
Attention:
Subject in all respects to the terms and conditions of the Selling Agency
Agreement (the "Agreement") dated __________, 2001, between [Agents], 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 Agents 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 Agents;
(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
Agents, 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 Agents, or any increases in any items specified by the Agents, in
each case as compared with the comparable period of the preceding year and
with any other period of corresponding length specified by the Agents,
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 Agents 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 Agents
or in documents incorporated by reference in the Prospectus specified by the
Agents, 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 Agents 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
October 1, 2001 (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, 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 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
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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 Robert W.
Stahman, 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, Lamb, Greene & MacRae, L.L.P.
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EXHIBIT E
_________, 20__
To the Agents 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 October 1, 2001 (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
Bankers Trust Company and R.G. Page, as Trustees (Stanley Burg, 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 thereon, 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, subject to minor defects and clouds common to property of the size and
character of that of the
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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,
Robert W. Stahman
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