Document:

Credit Agreement

 Exhibit 10.1 
  
  
  
 CREDIT AGREEMENT 
 dated as of November 25, 2009 
 among 
 AVISTA CORPORATION, 
 THE BANKS PARTY HERETO, 
 JPMORGAN CHASE BANK, N.A. and UBS SECURITIES LLC, 
 as Co-Documentation Agents, 
 WELLS FARGO SECURITIES, LLC, 
 as Syndication Agent, 
 and 
 UNION BANK, N.A., 
 as Administrative Agent 
  
  
  
 UNION BANK, N.A. and WELLS FARGO
SECURITIES, LLC, 
 as Co-Lead Arrangers and Co-Book Managers 

 TABLE OF CONTENTS 
  

					
	 	  	 	  	Page
	 ARTICLE I DEFINITIONS
	  	1
	 Section 1.01
	  	Defined Terms	  	1
	 Section 1.02
	  	Terms Generally	  	13
		
	 ARTICLE II THE CREDITS
	  	14
	 Section 2.01
	  	Commitments	  	14
	 Section 2.02
	  	Loans	  	14
	 Section 2.03
	  	Notice of Borrowings	  	16
	 Section 2.04
	  	Repayment of Loans; Evidence of Debt	  	16
	 Section 2.05
	  	Fees	  	17
	 Section 2.06
	  	Interest on Loans	  	17
	 Section 2.07
	  	Default Interest	  	18
	 Section 2.08
	  	Alternate Rate of Interest	  	18
	 Section 2.09
	  	Termination, Reduction and Increase in Commitments	  	18
	 Section 2.10
	  	Prepayment	  	20
	 Section 2.11
	  	Reserve Requirements; Change in Circumstances	  	20
	 Section 2.12
	  	Change in Legality	  	21
	 Section 2.13
	  	Indemnity	  	22
	 Section 2.14
	  	Pro Rata Treatment	  	22
	 Section 2.15
	  	Sharing of Setoffs	  	23
	 Section 2.16
	  	Payments	  	23
	 Section 2.17
	  	Taxes	  	23
	 Section 2.18
	  	Termination or Assignment of Commitments under Certain Circumstances	  	26
	 Section 2.19
	  	Extension of Expiration Date	  	27
		
	 ARTICLE III REPRESENTATIONS AND WARRANTIES
	  	28
	 Section 3.01
	  	Organization; Powers	  	28
	 Section 3.02
	  	Authorization	  	29
	 Section 3.03
	  	Enforceability	  	29
	 Section 3.04
	  	Governmental Approvals	  	29
	 Section 3.05
	  	Financial Statements	  	29
	 Section 3.06
	  	No Material Adverse Change	  	30
	 Section 3.07
	  	Litigation; Compliance with Laws	  	30
	 Section 3.08
	  	Federal Reserve Regulations	  	30
	 Section 3.09
	  	Investment Company Act	  	31
	 Section 3.10
	  	No Material Misstatements	  	31
	 Section 3.11
	  	Employee Benefit Plans	  	31
	 Section 3.12
	  	Environmental and Safety Matters	  	31
	 Section 3.13
	  	Significant Subsidiaries	  	32

  

 i 

					
	 ARTICLE IV CONDITIONS TO BORROWINGS AND EXTENSIONS
	  	32
	 Section 4.01
	  	All Borrowings	  	32
	 Section 4.02
	  	First Borrowing	  	32
	 Section 4.03
	  	Extensions	  	34
		
	 ARTICLE V AFFIRMATIVE COVENANTS
	  	35
	 Section 5.01
	  	Existence; Businesses and Properties	  	35
	 Section 5.02
	  	Insurance	  	35
	 Section 5.03
	  	Taxes and Obligations	  	36
	 Section 5.04
	  	Financial Statements, Reports, etc.	  	36
	 Section 5.05
	  	Litigation and Other Notices	  	37
	 Section 5.06
	  	ERISA	  	37
	 Section 5.07
	  	Maintaining Records; Access to Properties and Inspections	  	38
	 Section 5.08
	  	Use of Proceeds	  	38
		
	 ARTICLE VI NEGATIVE COVENANTS
	  	38
	 Section 6.01
	  	Liens	  	38
	 Section 6.02
	  	Sale-Leaseback Transactions	  	41
	 Section 6.03
	  	Mergers, Consolidations and Acquisitions	  	41
	 Section 6.04
	  	Disposition of Assets	  	42
	 Section 6.05
	  	Consolidated Total Debt to Consolidated Total Capitalization Ratio	  	43
	 Section 6.06
	  	Avista Utilities Interest-Coverage Ratio	  	43
	 Section 6.07
	  	Public Utility Regulatory Borrowing Limits	  	43
	 Section 6.08
	  	Investments	  	43
		
	 ARTICLE VII EVENTS OF DEFAULT
	  	43
		
	 ARTICLE VIII RELEASE OF COLLATERAL
	  	46
	 Section 8.01
	  	Release upon Commitment Reduction	  	46
	 Section 8.02
	  	Release upon Termination and Repayment	  	46
		
	 ARTICLE IX THE ADMINISTRATIVE AGENT
	  	46
	 Section 9.01
	  	Appointment and Powers	  	46
	 Section 9.02
	  	Limitation on Liability	  	47
	 Section 9.03
	  	Other Transactions with Borrower	  	48
	 Section 9.04
	  	Reimbursement; Indemnification	  	48
	 Section 9.05
	  	Absence of Reliance	  	48
	 Section 9.06
	  	Resignation of Administrative Agent	  	48
	 Section 9.07
	  	Syndication Agent and Co-Documentation Agents	  	49
	 Section 9.08
	  	Replacement of Certain Banks	  	49
		
	 ARTICLE X MISCELLANEOUS
	  	49
	 Section 10.01
	  	Notices	  	49
	 Section 10.02
	  	Survival of Agreement	  	50
	 Section 10.03
	  	Binding Effect	  	50

  

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	 Section 10.04
	  	Successors and Assigns	  	51
	 Section 10.05
	  	Expenses; Indemnity, Damage Waiver	  	53
	 Section 10.06
	  	Right of Setoff	  	54
	 Section 10.07
	  	Applicable Law	  	54
	 Section 10.08
	  	Waivers; Amendment	  	55
	 Section 10.09
	  	Interest Rate Limitation	  	55
	 Section 10.10
	  	Entire Agreement	  	55
	 Section 10.11
	  	Waiver of Jury Trial	  	56
	 Section 10.12
	  	Severability	  	56
	 Section 10.13
	  	Counterparts	  	56
	 Section 10.14
	  	Headings	  	56
	 Section 10.15
	  	Jurisdiction; Consent to Service of Process	  	56
	 Section 10.16
	  	USA Patriot Act Notification	  	57

  

			
	 Exhibit A
	  	Form of Note
	 Exhibit B
	  	Form of Assignment and Assumption
	 Exhibit C
	  	Form of Administrative Questionnaire
	 Exhibit D
	  	Form of Commitment Increase Supplement
	 Exhibit E
	  	Form of Commitment Extension Supplement
		
	 Schedule 2.01
	  	Names, Commitments and Addresses of Initial Banks
	 Schedule 3.13
	  	Significant Subsidiaries
	 Schedule 4.02(a)(ii)
	  	Required Governmental Approvals
	 Schedule 6.01
	  	Existing Secured Indebtedness

  

 iii 

 CREDIT AGREEMENT, dated as of November 25, 2009, among AVISTA CORPORATION, a Washington
corporation, the Banks listed in Schedule 2.01, JPMORGAN CHASE BANK, N.A. and UBS SECURITIES LLC, as Co-Documentation Agents, WELLS FARGO SECURITIES, LLC, as Syndication Agent, and UNION BANK, N.A., as Administrative Agent. 
 The Borrower has requested that the Banks agree to make loans on a revolving credit basis during the period commencing with the date hereof
and ending on the Expiration Date (as defined herein) in an aggregate principal amount not in excess of $75,000,000 at any time outstanding (subject to increase at the election of the Borrower by an aggregate amount not to exceed $25,000,000, upon
satisfaction of certain conditions as hereinafter provided). The proceeds of such borrowings are to be used for general corporate purposes. 
 In consideration of the mutual covenants and agreements contained herein, the parties agree as follows: 
 ARTICLE I 
 DEFINITIONS 
 Section 1.01 Defined Terms. As used in this Agreement, the following terms shall have the meanings specified below: 

“ABR” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such
Borrowing, are bearing interest at a rate determined by reference to the Alternate Base Rate. 
 “ABR
Borrowing” shall mean a Borrowing comprised of ABR Loans. 
 “ABR Loan” shall mean any Loan
bearing interest at a rate determined by reference to the Alternate Base Rate in accordance with the provisions of Article II. 
 “Administrative Agent” shall mean Union Bank, as administrative agent for the Banks under the Loan Documents, and any successor Administrative Agent appointed pursuant to Section 9.06. 
 “Administrative Questionnaire” shall mean an Administrative Questionnaire in the form of Exhibit C. 
 “Affiliate” shall mean, when used with respect to a specified person, another person that directly, or indirectly
through one or more intermediaries, Controls or is Controlled by or is under common Control with the person specified. 
 “Agreement” shall mean this Agreement, including all exhibits and schedules hereto. 

 “Alternate Base Rate” shall mean, for any day, a rate per annum
(rounded upwards, if necessary, to the nearest 1/16 of 1%) equal to the greatest of (a) the Reference Rate in effect on such day, (b) the sum of (i) the Federal Funds Effective Rate in effect for such day plus (ii) 1/2 of 1%
and (c) the Eurodollar Rate for an Interest Period of 1 month commencing on such day. If for any reason the Administrative Agent shall have determined (which determination shall be conclusive absent manifest error) that it is unable to
ascertain the Federal Funds Effective Rate for any reason, the Alternate Base Rate shall be determined without regard to clause (b) of the first sentence of this definition until the circumstances giving rise to such inability no longer exist.
Any change in the Alternate Base Rate due to a change in the Reference Rate shall be effective on the date such change in the Reference Rate is adopted. 
 “Applicable Rate” shall mean, on any date with respect to the Facility Fee, Eurodollar Loans or ABR Loans, the rate per annum set forth in the following table in the “Facility
Fee,” “Eurodollar Margin” or “ABR Margin” column, as applicable, for the Pricing Level in effect for such date. 
  

							
	 Pricing Level
	 	 Facility Fee
	 	 Eurodollar Margin
	 	 ABR Margin

	 I
	 	0.25%	 	2.00%	 	2.00%
	 II
	 	0.30%	 	2.20%	 	2.20%
	 III
	 	0.375%	 	2.375%	 	2.375%
	 IV
	 	0.50%	 	2.50%	 	2.50%
	 V
	 	0.75%	 	2.75%	 	2.75%
	 VI
	 	0.875%	 	3.125%	 	3.125%

 For purposes of determining which Pricing Level is applicable in the foregoing table the following
rules will apply: 
 “Pricing Level I” will be applicable at any date if, at such date, the Senior Debt Rating is Fifth
Lowest Investment Grade or higher; 
 “Pricing Level II” will be applicable at any date if, at such date, the Senior
Debt Rating is Fourth Lowest Investment Grade and Pricing Level I is not applicable; 
 “Pricing Level III” will be
applicable at any date if, at such date, the Senior Debt Rating is Third Lowest Investment Grade and neither Pricing Level I nor Pricing Level II is applicable; 
 “Pricing Level IV” will be applicable at any date if, at such date, the Senior Debt Rating is Second Lowest Investment Grade and none of Pricing Level I, Pricing Level II or Pricing Level III is
applicable; 
 “Pricing Level V” will be applicable at any date if, at such date, the Senior Debt Rating is Lowest
Investment Grade and none of Pricing Level I, Pricing Level II, Pricing Level III or Pricing Level IV is applicable; 
  

 2 

 “Pricing Level VI” will be applicable at any date if, at such date, the Senior
Debt Rating is Highest Non-Investment Grade or lower. 
 In the event that the Borrower’s Senior Debt Ratings are split by one level, the
higher rating will apply. In the event the ratings are split by more than one level, the level that is one level below the higher rating will apply. 
 “Assignment and Assumption” shall mean an assignment and assumption agreement entered into by a Bank and an assignee in the form of Exhibit B or such other form as shall be
approved by the Administrative Agent. 
 “Attributable Debt” shall mean, in connection with any
Sale-Leaseback, the present value (discounted in accordance with GAAP at the discount rate implied in the lease) of the obligations of the lessee for rental payments during the term of the lease. 
 “Availability Period” shall mean the period from and including the date of this Agreement to but excluding the
Expiration Date. 
 “Avista Utilities” means the operating division of the Borrower which represents all
the regulated utility operations of the Borrower that are responsible for retail electric and natural gas distribution, electric transmission services and electric generation and production. 
 “Avista Utilities EBITDA” means, for any period, (a) Avista Utilities Net Income for such period plus
(b) in each case, without duplication and to the extent deducted in computing Avista Utilities Net Income for such period, the sum for such period of (i) income tax expense, (ii) interest expense, (iii) depreciation and
amortization expense, (iv) any extraordinary or non-recurring losses and (v) other non-cash items reducing Avista Utilities Net Income for such period, minus (c) in each case, without duplication and to the extent added in computing
Avista Utilities Net Income for such period, the sum of for such period of (i) any extraordinary or non-recurring gains and (ii) other non-cash items increasing Avista Utilities Net Income for such period, all as determined in accordance
with GAAP. 
 “Avista Utilities Interest Expense” means, for any period, interest expense of Avista
Utilities for such period determined in accordance with GAAP. 
 “Avista Utilities Net Income” means,
for any period, the net income or loss of Avista Utilities for such period determined in accordance with GAAP. 
 “Bank” shall mean (a) any person listed on Schedule 2.01 and (b) any person that has been assigned any or all of the rights or obligations of a Bank pursuant to Section 10.04. 
 “Board” shall mean the Board of Governors of the Federal Reserve System of the United States. 
 “Bond Delivery Agreement” shall mean the Bond Delivery Agreement, dated as of November 25, 2009, between the
Borrower and the Administrative Agent. 
  

 3 

 “Borrower” shall mean Avista Corporation, a Washington corporation,
and its successors and assigns. 
 “Borrowing” shall mean a group of Loans of the same Type made on the
same date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect. 
 “Business
Day” shall mean any day (other than a day which is a Saturday, Sunday or legal holiday in the State of California or the State of New York) on which banks are open for business in Los Angeles and New York City; provided that when
used in connection with a Eurodollar Loan the term “Business Day” shall also exclude any day on which banks are not open for dealings in deposits in dollars in the London interbank market. 
 “Capital Lease Obligations” of any person shall mean the obligations of such person to pay rent or other amounts
under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such person under
GAAP and, for the purposes of this Agreement, the amount of such obligations at any time shall be the capitalized amount thereof at such time determined in accordance with GAAP. 
 “Change in Control” means (a) the acquisition of ownership, directly or indirectly, beneficially or of record,
by any person or group (within the meaning of the Securities Exchange Act of 1934 and the rules of the Securities and Exchange Commission thereunder as in effect on the date hereof), of shares representing more than 30% of the aggregate ordinary
voting power represented by the issued and outstanding capital stock of the Borrower; or (b) occupation of a majority of the seats (other than vacant seats) on the board of directors of the Borrower by persons who were neither
(i) nominated by the board of directors of the Borrower nor (ii) appointed by directors so nominated; provided, that no event described in clause (a) or clause (b) shall constitute a “Change in Control” if,
immediately after giving effect to the transaction that would otherwise constitute a Change in Control, the Senior Debt Rating assigned by two nationally recognized credit rating agencies is equal to or higher than Lowest Investment Grade.

 “Closing Date” shall mean the date on which the conditions precedent set forth in Sections 4.01 and
4.02 are first satisfied or waived. 
 “Code” shall mean the Internal Revenue Code of 1986, as the same
may be amended from time to time. 
 “Commitment” shall mean, with respect to each Bank, (a) (i) in
the case of a Bank listed on Schedule 2.01, the amount set forth opposite such Bank’s name under the heading “Commitment” on such Schedule and (ii) in the case of a Bank that becomes a Bank pursuant to an assignment under
Section 10.04, the amount specified as assigned to such Bank in the Assignment and Assumption pursuant to which such Bank becomes a Bank, in each case, as the same may be reduced from time to time pursuant to Section 2.09(b), increased
from time to time pursuant to Section 2.09(c), or reduced or increased from time to time pursuant to assignments in accordance with Section 10.04, or (b) as the context may require, the obligation of such Bank to make Loans in an
aggregate unpaid principal amount not exceeding such amount. 
  

 4 

 “Commitment Extension Supplement” shall have the meaning assigned to
such term in Section 2.19(e). 
 “Consolidated Total Capitalization” on any date means the sum,
without duplication, of the following with respect to the Borrower and its consolidated subsidiaries: (a) total capitalization as of such date, as determined in accordance with GAAP, (b) the current portion of liabilities which as of such
date would be classified in whole or part as long-term debt in accordance with GAAP (it being understood that the noncurrent portion of such liabilities is included in the total capitalization referred to in clause (a)), (c) all obligations as
lessee which, in accordance with GAAP, are capitalized as liabilities (including the current portion thereof), and (d) all other liabilities which would be classified as short-term debt in accordance with GAAP. 
 “Consolidated Total Debt” on any date means the sum, without duplication, of the following with respect to the
Borrower and its consolidated subsidiaries: (a) all liabilities which as of such date would be classified in whole or in part as long-term debt in accordance with GAAP (including the current portion thereof), (b) all obligations as lessee
which, in accordance with GAAP, are capitalized as liabilities (including the current portion thereof), (c) all other liabilities which would be classified as short-term debt in accordance with GAAP, and (d) all Guarantees of or by the
Borrower. 
 “Control” shall mean the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of a person, whether through the ownership of voting securities, by contract or otherwise, and “Controlling” and “Controlled” shall have meanings correlative thereto. 

“Current Expiration Date” shall have the meaning assigned to such term in Section 2.19(a). 
 “Default” shall mean any event or condition which upon notice, lapse of time or both would constitute an Event of
Default. 
 “Defaulting Bank” shall mean any Bank that (a) fails to make a payment or provide funds
to the Administrative Agent or the Borrower as required hereunder or otherwise fails to perform an obligation thereof under any Loan Document, and such failure is not cured within one Business Day, or (b) is the subject of a proceeding or event
of any type described in paragraph (g) or (h) of Article VII. 
 “dollars” or
“$” shall mean lawful money of the United States of America. 
 “Equity
Interests” shall mean shares of stock, partnership interests, membership interests in a limited liability company, beneficial interests in a trust or other equity ownership interests in a person, and all options, warrants or other
rights to acquire any such equity ownership interests in a person. 
  

 5 

 “ERISA” shall mean the Employee Retirement Income Security Act of
1974, as the same may be amended from time to time. 
 “ERISA Affiliate” shall mean any trade or
business (whether or not incorporated) that is a member of a group of which the Borrower is a member and which is treated as a single employer under Section 414 of the Code. 
 “Eurodollar,” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans
comprising such Borrowing, are bearing interest at a rate determined by reference to the Eurodollar Rate. 
 “Eurodollar Borrowing” shall mean a Borrowing comprised of Eurodollar Loans. 
 “Eurodollar Loan” shall mean any Loan bearing interest at a rate determined by reference to the Eurodollar Rate in accordance with the provisions of Article II. 
 “Eurodollar Rate” shall mean, for any Interest Period, the rate of interest per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) equal to (a) the rate appearing on Bloomberg screen BBAM (or any successor thereto) as the London interbank offered rate for deposits in dollars at approximately 11:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period for a term comparable to such Interest Period (provided, however, if more than one such rate is specified on Bloomberg screen BBAM, the applicable rate shall be the arithmetic mean of all
such rates), multiplied by (b) the Statutory Reserve Rate. If, for any reason, the rate specified in clause (a) above is not available for any Interest Period, there shall be substituted for such rate, for such Interest Period, the rate
per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to the rate determined by the Administrative Agent to be the offered rate on another page or service that displays an average British Bankers Association Interest Settlement
Rate for deposits in dollars (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period, determined as of approximately 11:00 a.m. (London time) two Business Days prior to the first day of such Interest
Period. In the event that the rates referenced in clause (a) above and in the preceding sentence are not available, there shall be substituted for the rate specified in clause (a) above the rate per annum (rounded upwards, if necessary, to
the nearest 1/100 of 1%) equal to the rate that would be offered to first-class banks in the London interbank market by Union Bank for deposits (for delivery on the first day of the relevant Interest Period) in dollars of amounts in same-day funds
comparable to the principal amount of the applicable Loan by Union Bank for which the Eurodollar Rate is then being determined with maturities comparable to such Interest Period as of approximately 11:00 a.m. (London time) two Business Days prior to
the first day of such Interest Period. 
 “Event of Default” shall have the meaning assigned to such
term in Article VII. 
 “Existing Commitments” shall have the meaning assigned to such term in
Section 2.19(c). 
  

 6 

 “Expiration Date” shall mean April 5, 2011 or any later date to
which such date (or any subsequent Expiration Date) shall have been extended pursuant to Section 2.19. 
 “Facility Fee” shall have the meaning assigned to such term in Section 2.05(a). 
 “Federal Funds Effective Rate” shall mean, for any Business Day, the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers,
as reported on such Business Day by the Federal Reserve Bank of New York, or, if such rate is not so reported for any day that is a Business Day, the average of the quotations for the day of such transactions received by the Administrative Agent
from three Federal funds brokers of recognized standing selected by it. 
 “Fees” shall mean the
Facility Fee and the other fees referred to in Section 2.05. 
 “Fifth Lowest Investment Grade”
shall mean that the Senior Debt Rating assigned to the applicable Indebtedness of the Borrower is a rating which, as reasonably determined by the Administrative Agent, would be the rating granted by the applicable credit-rating agency which is
generally treated as “investment grade” in the ratings regime of that credit-rating agency and is higher than Fourth Lowest Investment Grade. 
 “Financial Officer” of any corporation shall mean the chief financial officer or treasurer of such corporation. 
 “Financing Subsidiary” shall mean any Subsidiary of the Borrower created specifically and solely for the purpose of
providing financing directly to the Borrower (and no other Subsidiary of the Borrower or other person) through the issuance by such Subsidiary of debt or equity securities. 
 “First Mortgage” shall mean the Mortgage and Deed of Trust dated as of June 1, 1939, made by the Borrower in
favor of Citibank, N.A., as successor trustee, as the same has been amended, modified or supplemented to date and as the same may be further amended, modified or supplemented from time to time hereafter. 
 “First Mortgage Bond” shall mean (a) a first mortgage bond of the Forty-seventh Series issued to the
Administrative Agent on the Closing Date under a supplemental indenture to the First Mortgage, in a principal amount equal to the total Commitments on the date of execution and delivery of this Agreement, and/or (b) any first mortgage bond
issued under a supplemental indenture to the First Mortgage in addition to, or in substitution for, a first mortgage bond previously delivered to the Administrative Agent pursuant to this Agreement, in each case in connection with a reduction or
increase in the total Commitments pursuant to Section 2.09(b) or (c) or an extension of the Expiration Date pursuant to Section 2.19. 
 “Fourth Lowest Investment Grade” shall mean that the Senior Debt Rating assigned to the applicable Indebtedness of the Borrower is a rating which, as reasonably determined by the
Administrative Agent, would be the rating granted by the applicable credit-rating agency which is generally treated as “investment grade” in the ratings regime of that credit-rating agency and is higher than Third Lowest Investment Grade
but lower than Fifth Lowest Investment Grade. 
  

 7 

 “GAAP” shall mean generally accepted accounting principles, applied
on a consistent basis. 
 “Governmental Authority” shall mean, whether domestic or foreign, any
national, federal, state or local government, any political subdivision thereof, or any governmental, quasi-governmental, judicial, public or statutory agency, authority, instrumentality, body or entity, including any central bank and any comparable
authority. 
 “Guarantee” of or by any person shall mean any obligation, contingent or otherwise, of
such person guaranteeing or having the economic effect of guaranteeing any Indebtedness of any other person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of such person,
direct or indirect, (a) to purchase or pay (or to advance or supply funds for the purchase or payment of) such Indebtedness or to purchase (or to advance or supply funds for the purchase of) any security for the payment of such Indebtedness,
(b) to purchase property, securities or services for the purpose of assuring the owner of such Indebtedness of the payment of such Indebtedness or (c) to maintain working capital, equity capital or other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness; provided, however, that the term “Guarantee” shall not include endorsements for collection or deposit, in either case in the
ordinary course of business. 
 “Highest Non-Investment Grade” shall mean that the Senior Debt Rating
assigned to the applicable Indebtedness of the Borrower is a rating which, as reasonably determined by the Administrative Agent, would be the highest rating granted by the applicable credit-rating agency which is generally not treated as
“investment grade” in the ratings regime of that credit-rating agency. 
 “Indebtedness” of
any person shall mean, without duplication, (a) all obligations of such person for borrowed money or with respect to deposits or advances of any kind, (b) all obligations of such person evidenced by bonds, debentures, notes or similar
instruments, (c) all obligations of such person upon which interest charges are customarily paid, (d) all obligations of such person under conditional-sale or other title-retention agreements relating to property or assets purchased by
such person, (e) all obligations of such person issued or assumed as the deferred purchase price of property or services (other than trade payables incurred in the ordinary course of business), (f) all Indebtedness of others secured by (or
for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such person, whether or not the obligations secured thereby have been assumed, but limited, if such
obligations are without recourse to such person, to the lesser of the principal amount of such Indebtedness or the fair-market value of such property, (g) all Guarantees by such person of Indebtedness of others, (h) all Capital Lease
Obligations of such person, (i) all obligations of such person in respect of interest rate protection agreements, foreign currency exchange agreements or other interest or exchange rate hedging arrangements (the amount of any such obligation to
be the amount that would be payable upon the acceleration,

  

 8 

 
termination or liquidation thereof) and (j) all obligations of such person as an account party in respect of letters of credit and bankers’ acceptances. The Indebtedness of any person
shall include the Indebtedness of any partnership in which such person is a general partner. 
 “Interest Payment
Date” shall mean (a) in the case of any Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part and (b) in addition, in the case of a Eurodollar Loan that is part of a Eurodollar
Borrowing with an Interest Period of more than three months’ duration, each day that would have been an Interest Payment Date had successive Interest Periods of three months’ duration been applicable to such Borrowing. 
 “Interest Period” shall mean (a) as to any Eurodollar Borrowing, the period commencing on the date of such
Borrowing and ending on, as the Borrower may elect, the date 2 weeks thereafter or the numerically corresponding day (or, if there is no numerically corresponding day, on the last day) in the calendar month that is 1, 2, 3 or 6 months thereafter,
and (b) as to any ABR Borrowing, the period commencing on the date of such Borrowing and ending on the earlier of (i) the next succeeding March 31, June 30, September 30 or December 31 and (ii) the Expiration Date;
provided, however, that if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless, in the case of a Eurodollar Borrowing only, such next
succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day. Interest shall accrue from and including the first day of an Interest Period to but excluding the last
day of such Interest Period. 
 “Investment” by any person shall mean (a) the purchase or other
acquisition of any Equity Interest in any other person, (b) any loan, advance or extension of credit to any other person, (c) any contribution to the capital of any other person, (d) any Guarantee of the liabilities of any other
person or (e) any other investment in any other person. 
 “Lien” shall mean, with respect to any
asset, (a) any mortgage, deed of trust, lien, pledge, encumbrance, charge or security interest in or on such asset, (b) the interest of a vendor or a lessor under any conditional-sale agreement, capital lease or title-retention agreement
relating to such asset and (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities. 
 “Loan Documents” shall mean this Agreement, the First Mortgage Bond, the First Mortgage, the Supplemental Indenture, the Bond Delivery Agreement, any Notes and the agreement
between the Borrower and the Administrative Agent referred to in Section 2.05(b). 
 “Loans” shall
mean loans made by the Banks to the Borrower pursuant to this Agreement. 
 “Lowest Investment Grade”
shall mean that the Senior Debt Rating assigned to the applicable Indebtedness of the Borrower is a rating which, as reasonably determined by the Administrative Agent, would be the lowest rating granted by the applicable credit-rating agency which
is generally treated as “investment grade” in the ratings regime of that credit-rating agency. 
  

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 “Margin Stock” shall have the meaning given such term under
Regulation U. 
 “Material Adverse Effect” shall mean an effect on the business, assets, operations or
financial condition of the Borrower and the Subsidiaries taken as a whole which could reasonably be expected to have a material adverse effect on the creditworthiness of the Borrower. 
 “Notes” shall mean any promissory notes of the Borrower, substantially in the form of Exhibit A, evidencing Loans,
as may be delivered pursuant to Section 2.04. 
 “PBGC” shall mean the Pension Benefit Guaranty
Corporation referred to and defined in ERISA. 
 “person” shall mean (a) a corporation,
association, partnership, trust, limited liability company, organization, business or individual or (b) a Governmental Authority. 
 “Plan” shall mean any pension plan subject to the provisions of Title IV of ERISA or Section 412 of the Code which is maintained for employees of the Borrower or any ERISA Affiliate. 
 “Pro Rata Share” shall mean, with respect to any Bank, the percentage of the total Commitments represented by such
Bank’s Commitment. If the Commitments have terminated or expired, the Pro Rata Shares of the Banks shall be determined based upon the Commitments most recently in effect. 
 “Reference Rate” shall mean the variable rate of interest per annum established by Union Bank from time to time as
its “reference rate.” Such “reference rate” is set by Union Bank as a general reference rate of interest for “prime” commercial lending transactions, taking into account such factors as Union Bank may deem appropriate,
it being understood that many of Union Bank’s commercial or other loans are priced in relation to such rate, that it is not necessarily the lowest or best rate actually charged to any customer and that Union Bank may make various commercial or
other loans at rates of interest having no relationship to such rate. For purposes of this Agreement, each change in the Reference Rate shall be effective as of the opening of business on the date announced as the effective date of any change in
such “reference rate.” 
 “Register” shall have the meaning given to such term in
Section 10.04(c). 
 “Regulation D” shall mean Regulation D of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof and shall include any successor or other regulation or official interpretation of the Board relating to reserve requirements applicable to member banks of the Federal Reserve
System. 
 “Regulation U” shall mean Regulation U of the Board as from time to time in effect and all
official rulings and interpretations thereunder or thereof. 
  

 10 

 “Regulation X” shall mean Regulation X of the Board as from time to
time in effect and all official rulings and interpretations thereunder or thereof. 
 “Renewing Bank”
shall have the meaning assigned to such term in Section 2.19(a). 
 “Reportable Event” shall mean
any reportable event as defined in Section 4043(b) of ERISA or the regulations issued thereunder with respect to a Plan (other than a Plan maintained by an ERISA Affiliate which is considered an ERISA Affiliate only pursuant to subsection
(m) or (o) of Section 414 of the Code). 
 “Required Banks” shall mean, at any time,
Banks having Revolving Credit Exposures representing more than 50.0% of the aggregate Revolving Credit Exposures or, if there shall be no Revolving Credit Exposure, Banks having Commitments representing more than 50.0% of the aggregate Commitments.

 “Responsible Officer” of any corporation shall mean any executive officer or Financial Officer of
such corporation and any other officer or similar official thereof responsible for the administration of the obligations of such corporation in respect of this Agreement. 
 “Revolving Credit Exposure” shall mean, with respect to any Bank at any time, the sum of the outstanding principal amount of such Bank’s Loans at such time. 
 “RTO Transaction” shall mean any sale, transfer or other disposition of transmission assets entered into in
connection with the formation of a regional transmission organization pursuant to or in a manner consistent with regulatory requirements applicable to the Borrower. 
 “Sale-Leaseback” shall mean any arrangement whereby any person shall sell or transfer any property, real or personal, used or useful in its business, whether now owned or hereafter
acquired, and thereafter rent or lease such property or other property which it intends to use for substantially the same purpose or purposes as the property being sold or transferred. 
 “Second Lowest Investment Grade” shall mean that the Senior Debt Rating assigned to the applicable Indebtedness of
the Borrower is a rating which, as reasonably determined by the Administrative Agent, would be the rating granted by the applicable credit-rating agency which is generally treated as “investment grade” in the ratings regime of that
credit-rating agency and is higher than Lowest Investment Grade but lower than Third Lowest Investment Grade. 
 “Senior Debt Rating” means, as of any date of determination, as of the close of business on such date, the rating assigned to the Borrower’s most senior secured public Indebtedness by a nationally recognized
credit-rating agency selected by the Borrower, reasonably approved by the Administrative Agent and not objected to by the Required Banks within five Business Days following notice of such designation. 
  

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 “Significant Subsidiary” shall mean a Subsidiary meeting any one of
the following conditions: (a) the investments in and advances to such Subsidiary by the Borrower and the other Subsidiaries, if any, as at the end of the Borrower’s latest fiscal quarter exceeded 10% of the total assets of the Borrower and
its Subsidiaries at such date, computed and consolidated in accordance with GAAP; or (b) the Borrower’s and the other Subsidiaries’ proportionate share of the total assets (after intercompany eliminations) of such Subsidiary as at the
end of the Borrower’s latest fiscal quarter exceeded 10% of the total assets of the Borrower and its Subsidiaries at such date, computed and consolidated in accordance with GAAP; or (c) the equity in the income from continuing operations
before income taxes, extraordinary items and cumulative effect of a change in accounting principles of such Subsidiary for the period of four consecutive fiscal quarters ending at the end of the Borrower’s latest fiscal quarter exceeded 10% of
such income of the Borrower and its Subsidiaries for such period, computed and consolidated in accordance with GAAP; or (d) such Subsidiary is the parent of one or more Subsidiaries and together with such Subsidiaries would, if considered in
the aggregate, constitute a Significant Subsidiary. 
 “Statutory Reserve Rate” shall mean a fraction,
expressed as a decimal, the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentages (including for any marginal, special, emergency or supplemental reserves),
expressed as a decimal, established by the Board and to which Union Bank is subject for Eurocurrency funding (currently referred to as “Eurocurrency liabilities” in Regulation D). Such reserve percentages shall include those imposed
pursuant to Regulation D. Eurodollar Loans shall be deemed to constitute Eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that might be available from time to time
to any Bank under Regulation D or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any applicable reserve percentage. 
 “subsidiary” shall mean, for any person (the “Parent”), any corporation, limited liability
company, partnership or other entity of which securities or other ownership interests having by the terms thereof ordinary voting power to elect a majority of the board of directors or other persons performing similar functions of such corporation,
limited liability company, partnership or other entity (irrespective of whether or not at the time securities or other ownership interests of any other class or classes of such corporation, limited liability company, partnership or other entity
shall have or might have voting power by reason of the happening of any contingency) are at the time directly or indirectly owned or controlled by the Parent or one or more of its subsidiaries or by the Parent and one or more of its subsidiaries.

 “Subsidiary” shall mean a subsidiary of the Borrower. 
 “Supplemental Indenture” shall mean (a) the Forty-seventh Supplemental Indenture, dated as of November 1,
2009, between the Borrower and Citibank, N.A., as trustee under the First Mortgage, and/or (b) any supplemental indenture to the First Mortgage, in form and substance satisfactory to the Administrative Agent, pursuant to which a first mortgage
bond is issued in addition to, or in substitution for, a first mortgage bond previously delivered to the Administrative Agent pursuant to this Agreement, in each case in connection with a reduction or increase in the total Commitments pursuant to
Section 2.09(b) or (c) or an extension of the Expiration Date pursuant to Section 2.19. 
  

 12 

 “Terminated Bank” shall have the meaning assigned to such term in
Section 2.18(c). 
 “Terminating Bank” shall have the meaning assigned to such term in
Section 2.19(c). 
 “Third Lowest Investment Grade” shall mean that the Senior Debt Rating assigned
to the applicable Indebtedness of the Borrower is a rating which, as reasonably determined by the Administrative Agent, would be the rating granted by the applicable credit-rating agency which is generally treated as “investment grade” in
the ratings regime of that credit-rating agency and is higher than Second Lowest Investment Grade but lower than Fourth Lowest Investment Grade. 
 “Transactions” shall have the meaning assigned to such term in Section 3.02. 
 “Transferee” shall have the meaning assigned to such term in Section 2.17(a). 
 “Type,” when used in respect of any Loan or Borrowing, shall refer to the Rate by reference to which interest on such Loan or on the Loans comprising such Borrowing is
determined. For purposes hereof, “Rate” shall mean, in the case of a Loan or Borrowing, the Eurodollar Rate or the Alternate Base Rate. 
 “Union Bank” shall mean Union Bank, N.A. 
 Section 1.02 Terms Generally. The definitions in Section 1.01 shall apply equally to both the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” All references herein to Articles, Sections, Exhibits
and Schedules shall be deemed references to Articles and Sections of, and Exhibits and Schedules to, this Agreement unless the context shall otherwise require. Except as otherwise expressly provided herein, all accounting terms not otherwise defined
herein shall have the meanings assigned to them in conformity with GAAP as in effect at that time. Financial statements and other information required to be delivered by the Borrower to the Administrative Agent and the Banks pursuant to
Section 5.04 shall be prepared in accordance with GAAP as in effect at the time of such preparation, and calculations in connection with the definitions, covenants and other provisions hereof shall utilize accounting principles and policies in
conformity with GAAP as in effect at the time of such preparation. If the Borrower notifies the Administrative Agent that the Borrower requests an amendment to any provision hereof to eliminate the effect of any change occurring after the date
hereof in GAAP or in the application thereof on the operation of such provision (or if the Administrative Agent notifies the Borrower that the Required Banks request an amendment to any provision hereof for such purpose), regardless of whether any
such notice is given before or after such change in GAAP or in the application thereof, such provision shall be interpreted on the basis of GAAP as in effect at that time until such provision is amended in accordance herewith. 
  

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 ARTICLE II 
 THE CREDITS 
 Section 2.01 Commitments. Subject to the terms
and conditions and relying upon the representations and warranties herein set forth, each Bank agrees, severally and not jointly, to make Loans to the Borrower, at any time and from time to time during the Availability Period, in an aggregate
principal amount at any time outstanding that will not result in (a) the Revolving Credit Exposure of any Bank exceeding such Bank’s Commitment or (b) the total Revolving Credit Exposures exceeding the total Commitments. Within the
limits set forth in the preceding sentence, the Borrower may borrow, pay or prepay, and reborrow Loans during the Availability Period, subject to the terms, conditions and limitations set forth herein. 
 Section 2.02 Loans. 
 (a) Each Loan shall be made as part of a Borrowing consisting of Loans made by the Banks ratably in accordance with their Commitments. The failure of any Bank to make any Loan required to be made
hereunder shall not in itself relieve any other Bank of its obligation to lend hereunder (it being understood, however, that no Bank shall be responsible for the failure of any other Bank to make any Loan required to be made by such other Bank). The
Loans comprising each Borrowing shall be in the aggregate principal amount of $1,000,000 or a whole-integer multiple of $100,000 in excess thereof. 
 (b) Subject to Section 2.08, each Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans, as the Borrower may request pursuant to Section 2.03. Each Bank may at its option
fulfill its Commitment with respect to any Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such Bank to make such Loan; provided that any exercise of such option shall not affect the obligation of the Borrower to
repay such Loan in accordance with the terms of this Agreement or any applicable Note. Borrowings of more than one Type may be outstanding at the same time; provided, however, that the Borrower shall not be entitled to request any
Borrowing which, if made, would result in an aggregate of more than eight separate Eurodollar Loans of any Bank being outstanding hereunder at any one time. For purposes of the foregoing, Loans having different Interest Periods, regardless of
whether they commence on the same date, shall be considered separate Loans. 
 (c) Subject to paragraph (f) below, each
Bank shall make a Loan in the amount of its Pro Rata Share of each Borrowing on the proposed date thereof by wire transfer of immediately available funds to the Administrative Agent in Los Angeles, California, not later than 11:00 a.m., Pacific
time, and the Administrative Agent shall by 1:00 p.m., Pacific time, make available to the Borrower in immediately available funds the amounts so received (i) by wire transfer for credit to the account of the Borrower with Wells Fargo Bank,
National Association bearing Account Number 41688 14770, ABA # 121000248, re: Avista Corp. or (ii) as otherwise specified by the Borrower in its notice of Borrowing or, if a Borrowing shall not occur on such date because any condition precedent
herein specified shall not have been met,

  

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return the amounts so received to the respective Banks. Unless the Administrative Agent shall have received notice from a Bank prior to the date of any Eurodollar Borrowing or prior to 11:00
a.m., Pacific time, on the date of any ABR Borrowing that such Bank will not make available to the Administrative Agent such Bank’s portion of such Borrowing, the Administrative Agent may assume that such Bank has made such portion available to
the Administrative Agent on the date of such Borrowing in accordance with this paragraph (c), and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower on such date a corresponding amount. If and to the
extent that such Bank shall not have made such portion available to the Administrative Agent, such Bank and the Borrower severally agree to repay to the Administrative Agent forthwith on demand such corresponding amount together with interest
thereon, for each day from the date such amount is made available to the Borrower until the date such amount is repaid to the Administrative Agent, at (i) in the case of the Borrower, the interest rate applicable at the time to the Loans
comprising such Borrowing and (ii) in the case of such Bank, the Federal Funds Effective Rate. If such Bank shall repay to the Administrative Agent such corresponding amount, such amount shall constitute such Bank’s Loan as part of such
Borrowing for purposes of this Agreement. 
 (d) The Administrative Agent may (but shall not be required to), in its discretion,
retain any payments or other funds received thereby that are to be provided to a Defaulting Bank hereunder (but shall have no obligation to pay interest thereon), and the Administrative Agent may apply such funds to such Defaulting Bank’s
defaulted obligations or readvance the funds to the Borrower in accordance with this Agreement. The failure of any Bank to perform its obligations hereunder shall not relieve any other Bank of its obligations, and no Bank shall be responsible for a
default by another Bank. The Banks and the Administrative Agent agree (which agreement is solely among them and not for the benefit of or enforceable by the Borrower) that, solely for purposes of determining a Defaulting Bank’s right to vote on
matters relating to the Loan Documents and to share in payments, fees and collateral proceeds thereunder, a Defaulting Bank shall not be deemed to be a “Bank” until all of its defaulted obligations have been cured. For the avoidance of
doubt, a Defaulting Bank shall not be entitled to vote on (i) any matter relating to this Agreement or any of the other Loan Documents that requires the approval, consent or non-objection of the Required Banks or of all of the Banks or
(ii) the extension of the Expiration Date pursuant to Section 2.19; provided, however, that a Defaulting Bank shall be treated as a Terminating Bank in connection with any request by the Borrower to extend the Expiration Date pursuant to
Section 2.19. Notwithstanding anything herein to the contrary, the Borrower reserves all of its rights and remedies against each Defaulting Bank to recover any damages caused to the Borrower by such Defaulting Bank by reason of such Defaulting
Bank’s failure to make any payment or provide funds to the Administrative Agent or the Borrower as required hereunder. 
 (e) Notwithstanding any other provision of this Agreement, the Borrower shall not be entitled to request any Borrowing if the Interest Period requested with respect thereto would end after the Expiration Date. 
 (f) The Borrower may refinance all or any part of any Borrowing with a new Borrowing of the same or a different Type, subject to the
conditions and limitations set forth in this Agreement. Any Borrowing or part thereof so refinanced shall be deemed to be repaid or

  

 15 

 
prepaid in accordance with Section 2.04 or 2.10, as applicable, with the proceeds of the new Borrowing, and the proceeds of the new Borrowing, to the extent they do not exceed the principal
amount of the Borrowing being refinanced, shall not be paid by the Banks to the Administrative Agent or by the Administrative Agent to the Borrower pursuant to paragraph (c) above. 
 Section 2.03 Notice of Borrowings. To request a Borrowing, the Borrower shall give the Administrative Agent notice thereof
(a) in the case of a Eurodollar Borrowing, not later than 9:00 a.m., Pacific time, three Business Days before a proposed borrowing and (b) in the case of an ABR Borrowing, not later than 9:00 a.m., Pacific time, the day of a proposed
borrowing. Such notice shall be irrevocable and shall in each case refer to this Agreement and specify (i) whether the Borrowing then being requested is to be a Eurodollar Borrowing or an ABR Borrowing; (ii) the date of such Borrowing
(which shall be a Business Day) and the amount thereof; and (iii) if such Borrowing is to be a Eurodollar Borrowing, the Interest Period with respect thereto. If no election as to the Type of Borrowing is specified in any such notice, then the
requested Borrowing shall be an ABR Borrowing. If no Interest Period with respect to any Eurodollar Borrowing is specified in any such notice, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration. If the
Borrower shall not have given notice in accordance with this Section 2.03 of its election to refinance a Borrowing or given notice to the Administrative Agent not later than 9:00 a.m., Pacific time, on the last day of the Interest Period
applicable to such Borrowing that it will not refinance such Borrowing, then the Borrower shall be deemed to have given notice of an election to refinance such Borrowing with an ABR Borrowing. The Administrative Agent shall promptly advise the Banks
of any notice given pursuant to this Section 2.03 and of each Bank’s portion of the requested Borrowing. 
 Section 2.04 Repayment of Loans; Evidence of Debt. 
 (a) The Borrower hereby unconditionally promises to
pay each Bank the then unpaid principal amount of each Loan of such Bank on the last day of the Interest Period applicable to such Loan and on the Expiration Date. Each Loan shall bear interest on the outstanding principal balance thereof as set
forth in Section 2.06. 
 (b) Each Bank shall maintain in accordance with its usual practice an account or accounts
evidencing the indebtedness of the Borrower to such Bank resulting from each Loan made by such Bank, including the amounts of principal and interest payable and paid to such Bank from time to time hereunder. 
 (c) The Administrative Agent shall maintain accounts in which it shall record (i) the amount and date of each Loan made hereunder, the
Type thereof and the Interest Period applicable thereto, (ii) the amount of any principal, interest or fees due and payable or to become due and payable from the Borrower to each Bank hereunder and (iii) the amount of any principal,
interest or fees received by the Administrative Agent hereunder for the account of the Banks and each Bank’s share thereof. 
  

 16 

 (d) The entries made in the accounts maintained pursuant to paragraph (b) or
(c) of this Section shall be prima facie evidence of the existence and amounts of the obligations recorded therein; provided that the failure of any Bank or the Administrative Agent to maintain such accounts or any error therein
shall not in any manner affect the obligation of the Borrower to repay the Loans in accordance with the terms of this Agreement. 
 (e) Any Bank may request that Loans made by it be evidenced by a Note. In such event, the Borrower shall prepare, execute and deliver to such Bank a Note payable to the order of such Bank (or, if requested by such Bank, to such Bank and its
registered assigns). Thereafter, the Loans evidenced by such Note and interest thereon shall at all times (including after assignment pursuant to Section 10.04) be represented by one or more Notes in such form payable to the order of the payee
named therein (or, if such Note is a registered Note, to such payee and its registered assigns). 
 Section 2.05
Fees. 
 (a) The Borrower agrees to pay to each Bank, through the Administrative Agent, on the first Business Day of
January, April, July and October of each year and on the date on which the Commitment of such Bank shall be reduced or terminated as provided herein, a facility fee at the Applicable Rate (a “Facility Fee”) on the daily
amount of the Commitment of such Bank during the preceding quarter (or shorter period commencing with the date hereof or ending with the Expiration Date or the date on which the Commitment of such Bank shall be reduced or terminated). The Facility
Fees shall accrue on each day at a rate per annum equal to the Applicable Rate in effect on such day. All Facility Fees shall be computed on the basis of a year of 365 or 366 days, as the case may be, and shall be payable for the actual number of
days elapsed (including the first day but excluding the last day). The Facility Fee due to each Bank shall commence to accrue on the date of this Agreement and shall cease to accrue on the date on which the Commitment of such Bank shall be
terminated as provided herein. 
 (b) The Borrower agrees to pay to the Administrative Agent, for its own account, the fees
separately agreed between the Administrative Agent and the Borrower. 
 (c) Once paid, none of the Fees shall be refundable
under any circumstances. 
 Section 2.06 Interest on Loans. 
 (a) Subject to the provisions of Section 2.07, the Loans comprising each ABR Borrowing shall bear interest at a rate per annum equal to
the Alternate Base Rate plus the Applicable Rate. 
 (b) Subject to the provisions of Section 2.07, the Loans comprising
each Eurodollar Borrowing shall bear interest at a rate per annum equal to the Eurodollar Rate for the Interest Period in effect for such Borrowing plus the Applicable Rate. 
 (c) Interest on each Loan shall be payable on the Interest Payment Dates applicable to such Loan except as otherwise provided in this
Agreement. 
  

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 (d) Interest computed on the basis of the Alternative Base Rate (including interest payable
on overdue amounts under Section 2.07) shall be computed on the basis of a year of 365 or 366 days, as the case may be, for the actual number of days elapsed so long as the Reference Rate is the applicable rate for calculation of the Alternate
Base Rate, and on the basis of a year of 360 days for the actual number of days elapsed so long as the Federal Funds Effective Rate is the applicable rate for calculation of the Alternate Base Rate. Interest computed on the basis of the Eurodollar
Rate (including interest payable on overdue amounts under Section 2.07) shall be computed on the basis of a year of 360 days for the actual number of days elapsed. 
 (e) The applicable Alternate Base Rate or Eurodollar Rate for each Interest Period or day within an Interest Period, as the case may be, shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error. 
 Section 2.07 Default Interest. If the Borrower shall
default in the payment of the principal of or interest on any Loan or any other amount becoming due under the Loan Documents, by acceleration or otherwise, the Borrower shall on demand from time to time pay interest, to the extent permitted by law,
on such defaulted amount up to (but not including) the date of actual payment (after as well as before judgment) at a rate per annum equal to the Alternate Base Rate plus the Applicable Rate plus 2% (except that the interest rate applicable to an
overdue amount of principal of a Eurodollar Borrowing that became due on a day other than on the last day of the Interest Period applicable thereto shall, for the period until the last day of such Interest Period, be equal to 2% above the rate that
would otherwise be applicable thereto during such Interest Period). 
 Section 2.08 Alternate Rate of Interest. In
the event, and on each occasion, that on the day two Business Days prior to the commencement of any Interest Period for a Eurodollar Borrowing the Administrative Agent shall have in good faith determined that dollar deposits in the principal amounts
of the Loans comprising such Borrowing are not generally available in the London interbank market, or that the rates at which such dollar deposits are being offered will not adequately and fairly reflect the cost to the majority in interest of the
Banks of making or maintaining their Eurodollar Loans during such Interest Period, or that reasonable means do not exist for ascertaining the Eurodollar Rate, the Administrative Agent shall, as soon as practicable thereafter, give notice of such
determination to the Borrower and the Banks. In the event of any such determination, any request by the Borrower for a Eurodollar Borrowing pursuant to Section 2.03 shall, until the Administrative Agent shall have advised the Borrower and the
Banks that the circumstances giving rise to such notice no longer exist, be deemed to be a request for an ABR Borrowing. Each determination by the Administrative Agent hereunder shall be conclusive absent manifest error. 
 Section 2.09 Termination, Reduction and Increase in Commitments. 
 (a) The Commitments shall be automatically terminated on the Expiration Date. 
  

 18 

 (b) Upon at least three Business Days’ prior irrevocable notice to the Administrative
Agent, the Borrower may at any time in whole permanently terminate, or from time to time in part permanently reduce, the unused portion of the Commitments; provided, however, that (i) each partial reduction of the Commitments
shall be in the aggregate amount of $5,000,000 or a higher whole-integer multiple thereof, and (ii) the Borrower shall not terminate or reduce the Commitments if, after giving effect to any concurrent prepayment of the Loans in accordance with
Section 2.10, the sum of the Revolving Credit Exposures would exceed the total Commitments. 
 (c) At any time following
the date of this Agreement and prior to the Expiration Date, the aggregate amount of the Commitments may, at the option of the Borrower, be increased by an amount not in excess of $25,000,000, either by new Banks establishing Commitments or by one
or more then-existing Banks increasing their Commitments (each such new Bank or Bank increasing its Commitment, an “Additional Commitment Bank”); provided that (i) each Additional Commitment Bank shall be selected
or approved by the Borrower and shall be reasonably acceptable to the Administrative Agent, (ii) no Bank shall have an obligation to become an Additional Commitment Bank, (iii) no Default or Event of Default shall exist immediately prior
to or after the effective date of the increase in the Commitments, (iv) the representations and warranties set forth in Article III shall be true and correct in all material respects on and as of the effective date of the increase in the
Commitments with the same effect as if made on and as of such date, except to the extent that such representations and warranties expressly relate to an earlier date, (v) each increase in the Commitments shall be in an aggregate amount not less
than $10,000,000 and multiples of $5,000,000 in excess thereof, (vi) the aggregate amount of the increase in the Commitments after the date of this Agreement shall not exceed $25,000,000, and (vii) no increase in the Commitments shall
become effective unless and until (A) the Borrower, the Administrative Agent and each Additional Commitment Bank shall have executed and delivered an agreement substantially in the form of Exhibit D (a “Commitment Increase
Supplement”) and (B) the Administrative Agent shall have received a substitute First Mortgage Bond in an amount equal to the total Commitments after giving effect to the increase in the Commitments, together with a supplemental
indenture, a bond delivery agreement, mortgage title insurance, legal opinions and other certificates and documents with respect thereto comparable to those delivered pursuant to Section 4.02(a) with respect to the First Mortgage Bond issued
under the First Mortgage and delivered to the Administrative Agent on the Closing Date, in each case in form and substance satisfactory to the Administrative Agent. On the effective date of an increase in the Commitments, each Additional Commitment
Bank shall purchase, as an assignment from each other existing Bank, the portion of such other Bank’s Loans outstanding at such time such that, after giving effect to such assignments, the respective aggregate amount of Loans of each Bank shall
be equal to such Bank’s Pro Rata Share of the aggregate Loans outstanding. The purchase price for the Loans so assigned shall be the sum of the principal amount of the Loans so assigned plus the amount of accrued and unpaid interest thereon as
of the date of assignment. Each Additional Commitment Bank shall pay the aggregate purchase price payable by it to the Administrative Agent on the effective date of an increase in the Commitments, and the Administrative Agent shall promptly forward
to each other Bank the portion thereof payable to it. Upon payment of such purchase price, each other Bank shall be automatically deemed to have sold and made such an assignment to such Additional Commitment Bank and shall, to the extent of the
interest assigned, be released from its

  

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obligations under the Loan Documents, and such Additional Commitment Bank shall be automatically deemed to have purchased and assumed such an assignment from each other Bank and, if not already a
Bank hereunder, shall be a party hereto and, to the extent of the interest assigned, have the rights and obligations of a Bank under the Loan Documents. 
 Section 2.10 Prepayment. The Borrower shall have the right at any time and from time to time to prepay any Borrowing, in whole or in part, upon at least three Business Days’ prior notice
to the Administrative Agent, in the case of a prepayment of a Eurodollar Borrowing, and upon at least one Business Day’s prior notice, in the case of a prepayment of an ABR Borrowing; provided, however, that each partial
prepayment shall be in the amount of $1,000,000 or a higher whole-integer multiple thereof. Each notice of prepayment shall specify the prepayment date and the principal amount of each Borrowing (or portion thereof) to be prepaid, shall be
irrevocable and shall commit the Borrower to prepay such Borrowing by the amount stated therein on the date stated therein. All prepayments under this Section 2.10 shall be subject to Section 2.13 but otherwise without premium or penalty.
All prepayments under this Section 2.10 shall be accompanied by accrued interest on the principal amount being prepaid to (but excluding) the date of payment. 
 Section 2.11 Reserve Requirements; Change in Circumstances. 
 (a)
Notwithstanding any other provision herein, if after the date of this Agreement there is adopted any new law, rule or regulation or any change in applicable law or regulation or in the interpretation or administration thereof by any Governmental
Authority charged with the interpretation or administration thereof (whether or not having the force of law) which shall impose, modify or deem applicable any reserve, special-deposit or similar requirement against assets of, deposits with or for
the account of or credit extended by any Bank (except any such reserve requirement which is reflected in the Eurodollar Rate) or shall impose on such Bank or the London interbank market any other condition affecting this Agreement or Eurodollar
Loans made by such Bank, and the result of any of the foregoing shall be to increase the cost to such Bank of making or maintaining any Eurodollar Loan or to reduce the amount of any sum received or receivable by such Bank hereunder or under any
Notes (whether of principal, interest or otherwise) by an amount deemed by such Bank to be material, then the Borrower will pay to such Bank upon demand such additional amount or amounts as will compensate such Bank for such additional costs
incurred or reduction suffered. 
 (b) If any Bank shall have determined that the applicability of any law, rule, regulation,
agreement or guideline adopted after the date hereof regarding capital adequacy, or any change in any of the foregoing or the adoption after the date hereof of any change in any law, rule, regulation, agreement or guideline existing on the date
hereof or in the interpretation or administration of any of the foregoing by any Governmental Authority charged with the interpretation or administration thereof, or compliance by any Bank (or any lending office thereof) or any Bank’s holding
company with any request or directive regarding capital adequacy (whether or not having the force of law) of any such authority, central bank or comparable agency, has or would have the effect of reducing the rate of return on such Bank’s
capital or on the capital of such Bank’s holding company, if any, with respect to this Agreement or Loans made by such Bank to a level below that which such Bank or such Bank’s holding company

  

 20 

 
could have achieved but for such applicability, adoption, change or compliance (taking into consideration such Bank’s policies and the policies of such Bank’s holding company with
respect to capital adequacy) by an amount deemed by such Bank to be material, then from time to time the Borrower shall pay to such Bank such additional amount or amounts as will compensate such Bank or such Bank’s holding company for any such
reduction suffered. It is acknowledged that this Agreement is being entered into by the Banks on the understanding that the Banks will not be required to maintain capital against their obligations to make Loans under currently applicable laws,
regulations and regulatory guidelines. In the event that the Banks shall be advised by any Governmental Authority or shall otherwise determine on the basis of pronouncements of any Governmental Authority that such understanding is incorrect, it is
agreed that the Banks will be entitled to make claims under this paragraph based upon market requirements prevailing on the date hereof for commitments under comparable credit facilities against which capital is required to be maintained.

 (c) A certificate of a Bank setting forth in reasonable detail such amount or amounts as shall be necessary to compensate
such Bank or such Bank’s holding company as specified in paragraph (a) or (b) above, as the case may be, and the manner in which such Bank has determined the same, shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay the Bank the amount shown as due on any such certificate delivered by it within 10 days after its receipt of the same. 
 (d) Failure on the part of any Bank to demand compensation for any increased costs or reduction in amounts received or receivable or reduction in return on capital with respect to any period shall not
constitute a waiver of such Bank’s right to demand compensation with respect to such period or any other period. The protection of this Section shall be available to each Bank regardless of any possible contention of the invalidity or
inapplicability of the law, rule, regulation, guideline or other change or condition which shall have occurred or been imposed. 
 Section 2.12 Change in Legality. 
 (a) Notwithstanding any other provision herein, if any change in, or
adoption of, any law or regulation or in the interpretation thereof by any Governmental Authority charged with the administration or interpretation thereof shall make it unlawful for any Bank to make or maintain any Eurodollar Loan or to give effect
to its obligations as contemplated hereby with respect to any Eurodollar Loan, then, by notice to the Borrower and to the Administrative Agent, such Bank may: 
 (i) declare that Eurodollar Loans will not thereafter be made by such Bank hereunder, whereupon any request by the Borrower for a Eurodollar Borrowing shall, as to such Bank only, be deemed a request for
an ABR Loan unless such declaration shall be subsequently withdrawn; and 
 (ii) require that all outstanding Eurodollar Loans
made by it be converted to ABR Loans, in which event all such Eurodollar Loans shall be automatically converted to ABR Loans as of the effective date of such notice as provided in paragraph (b) below. 
  

 21 

 In the event any Bank shall exercise its rights under (i) or (ii) above, all payments and
prepayments of principal which would otherwise have been applied to repay the Eurodollar Loans that would have been made by such Bank or the converted Eurodollar Loans of such Bank shall instead be applied to repay the ABR Loans made by such Bank in
lieu of, or resulting from the conversion of, such Eurodollar Loans. 
 (b) For purposes of this Section 2.12, a notice to
the Borrower by any Bank shall be effective as to each Eurodollar Loan, if lawful, on the last day of the Interest Period currently applicable to such Eurodollar Loan. 
 Section 2.13 Indemnity. The Borrower shall indemnify each Bank against any loss or expense which such Bank may sustain or incur as a consequence of (a) any failure by the Borrower to
fulfill on the date of any Eurodollar Borrowing hereunder the applicable conditions set forth in Article IV, (b) any failure by the Borrower to borrow any Eurodollar Loan hereunder after irrevocable notice of such borrowing has been given
or deemed given pursuant to Section 2.03, (c) any payment or prepayment of a Eurodollar Loan required by any provision of this Agreement or otherwise made or deemed made on a date other than the last day of the Interest Period applicable
thereto, (d) any assignment of a Eurodollar Loan pursuant to Section 2.18(b) made or deemed made on a date other than the last day of the Interest Period applicable thereto, or (e) any default in payment or prepayment of the principal
amount of any Eurodollar Loan or any part thereof or interest accrued thereon, as and when due and payable (at the due date thereof, whether by scheduled maturity, acceleration, irrevocable notice of prepayment or otherwise) including, in each such
case, any loss or reasonable expense sustained or incurred or to be sustained or incurred in liquidating or employing deposits from third parties acquired to effect or maintain such Loan or any part thereof as a Eurodollar Loan. Such loss or
reasonable expense shall include an amount equal to the excess, if any, as reasonably determined by such Bank, of (i) its cost of obtaining the funds for the Eurodollar Loan being paid, prepaid, assigned or not borrowed (assumed to be the
Eurodollar Rate applicable thereto) for the period from the date of such payment, prepayment, assignment or failure to borrow to the last day of the Interest Period for such Loan (or, in the case of a failure to borrow, the Interest Period for such
Eurodollar Loan which would have commenced on the date of such failure) over (ii) the amount of interest (as reasonably determined by such Bank) that would be realized by such Bank in reemploying the funds so paid, prepaid, assigned or not
borrowed for such period or Interest Period, as the case may be. A certificate of any Bank setting forth any amount or amounts which such Bank is entitled to receive pursuant to this Section, and the manner in which such Bank has determined the
same, shall be delivered to the Borrower and shall be conclusive absent manifest error. 
 Section 2.14 Pro Rata
Treatment. Except as required under Section 2.12, each Borrowing, each payment or prepayment of principal of any Borrowing, each payment of interest on the Loans, each payment of the Fees, and each reduction of the Commitments shall be
allocated among the Banks in accordance with their respective Pro Rata Shares. Each Bank agrees that, in computing such Bank’s portion of any Borrowing to be made hereunder, the Administrative Agent may, in its discretion, round each
Bank’s Pro Rata Share of such Borrowing to the next higher or lower whole-dollar amount. 
  

 22 

 Section 2.15 Sharing of Setoffs. Each Bank agrees that if it shall, through the
exercise of a right of banker’s lien, setoff or counterclaim against the Borrower, or pursuant to a secured claim under Section 506 of Title 11 of the United States Code or other security or interest arising from, or in lieu of, such
secured claim, received by such Bank under any applicable bankruptcy, insolvency or other similar law or otherwise, or by any other means, obtain payment (voluntary or involuntary) in respect of its Loans as a result of which the unpaid principal
portion of its Loans shall be proportionately less than the unpaid principal portion of the Loans of any other Bank, it shall be deemed simultaneously to have purchased from such other Bank at face value, and shall promptly pay to such other Bank
the purchase price for, a participation in the Loans of such other Bank (“Sharing Participations”), so that (a) the aggregate unpaid principal amount of the Loans and Sharing Participations held by each Bank shall be in
the same proportion to the aggregate unpaid principal amount of all Loans then outstanding as (b) the principal amount of its Loans and Sharing Participations prior to such exercise of banker’s lien, setoff or counterclaim or other event
was to the principal amount of all Loans outstanding prior to such exercise of banker’s lien, setoff or counterclaim or other event; provided, however, that, if any such purchase or purchases or adjustments shall be made pursuant
to this Section and the payment giving rise thereto shall thereafter be recovered, such purchase or purchases or adjustments shall be rescinded to the extent of such recovery and the purchase price or prices or adjustment restored without
interest. The Borrower expressly consents to the foregoing arrangements and agrees that any Bank holding a participation in a Loan deemed to have been so purchased may exercise any and all rights of banker’s lien, setoff or counterclaim with
respect to any and all moneys owing by the Borrower to such Bank by reason thereof as fully as if such Bank had made a Loan directly to the Borrower in the amount of such participation. 
 Section 2.16 Payments. 
 (a) The Borrower shall make each payment (including principal of or interest on any Borrowing or any Fees or other amounts) hereunder and under any other Loan Document not later than 9:00 a.m., Pacific
time, on the date when due in dollars to the Administrative Agent at its offices at 445 South Figueroa Street, Los Angeles, California 90071, in immediately available funds. 
 (b) Whenever any payment (including principal of or interest on any Borrowing or any Fees or other amounts) hereunder or under any other
Loan Document shall become due, or otherwise would occur, on a day that is not a Business Day, such payment may be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of interest or
Fees, if applicable. 
 Section 2.17 Taxes. 
 (a) Any and all payments by the Borrower hereunder and under any other Loan Document shall be made, in accordance with Section 2.16,
free and clear of and without deduction for any and all present or future taxes, levies, imposts, deductions, charges or

  

 23 

 
withholdings, and all liabilities with respect thereto, excluding taxes imposed on the net income of the Administrative Agent or any Bank (or any transferee or assignee thereof, including a
participation holder (any such entity being called a “Transferee”)) and franchise taxes imposed on the Administrative Agent or any Bank (or Transferee) by the United States or any jurisdiction under the laws of which the
Administrative Agent or any such Bank (or Transferee) or the applicable lending office, is organized or any political subdivision thereof (all such nonexcluded taxes, levies, imposts, deductions, charges, withholdings and liabilities being
hereinafter referred to as “Taxes”). If the Borrower shall be required by law to deduct any Taxes from or in respect of any sum payable under any Loan Document to the Banks (or any Transferee) or the Administrative Agent,
(i) the sum payable shall be increased by the amount necessary so that after making all required deductions of Taxes (including deductions applicable to additional sums payable under this Section 2.17) such Bank (or Transferee) or the
Administrative Agent (as the case may be) shall receive an amount equal to the sum it would have received had no such deductions of Taxes been made, (ii) the Borrower shall make such deductions and (iii) the Borrower shall pay the full
amount deducted to the relevant taxing authority or other Governmental Authority in accordance with applicable law; provided, however, that no Transferee of any Bank shall be entitled to receive any greater payment under this paragraph
(a) than such Bank would have been entitled to receive with respect to the rights assigned, participated or other wise transferred except to the extent that such greater payment arises from circumstances not in existence at the time such
assignment, participation or transfer shall have been made. 
 (b) In addition, the Borrower agrees to pay any present or future
stamp or documentary taxes or any other excise or property taxes, charges or similar levies which arise from any payment made under any Loan Document or from the execution, delivery or registration of, or otherwise with respect to, this Agreement or
any other Loan Document (hereinafter referred to as “Other Taxes”). 
 (c) The Borrower will indemnify
each Bank (or Transferee) and the Administrative Agent for the full amount of any Taxes and Other Taxes paid by such Bank (or Transferee) or the Administrative Agent, as the case may be, and any liability (including penalties, interest and
reasonable expenses) arising therefrom or with respect thereto, whether or not such Taxes or Other Taxes were correctly or legally asserted by the relevant taxing authority or other Governmental Authority. Such indemnification shall be made within
30 days after the date any Bank (or Transferee) or the Administrative Agent, as the case may be, makes written demand therefor. If a Bank (or Transferee) or the Administrative Agent shall become aware that it is entitled to receive a refund in
respect of Taxes or Other Taxes as to which it has been indemnified by the Borrower pursuant to this Section 2.17, it shall promptly notify the Borrower of the availability of such refund and shall, within 30 days after receipt of a request by
the Borrower, apply for such refund at the Borrower’s expense. 
 (d) If any Bank (or Transferee) or the Administrative
Agent receives a refund in respect of any Taxes or Other Taxes as to which it has been indemnified by the Borrower pursuant to this Section 2.17, it shall promptly notify the Borrower of such refund and shall repay such refund to the Borrower
(to the extent of amounts that have been paid by the Borrower under this Section 2.17 with respect to such refund) within 30 days (or promptly upon receipt, if

  

 24 

 
the Borrower has requested application for such refund pursuant hereto), net of all reasonable out-of-pocket expenses of such Bank (or Transferee) and without interest (other than interest
included in such refund); provided that the Borrower, upon the request of such Bank (or Transferee) or the Administrative Agent, agrees to return such refund (plus penalties, interest or other charges) to such Bank (or Transferee) or the
Administrative Agent in the event such Bank (or Transferee) or the Administrative Agent is required to repay such refund. Nothing contained in this paragraph (d) shall require any Bank (or Transferee) or the Administrative Agent to make
available any of its tax returns (or any other information relating to its taxes which it deems to be confidential); provided that Borrower, at its expense, shall have the right to receive an opinion from a firm of independent public
accountants of recognized national standing acceptable to the Borrower that the amount due hereunder is correctly calculated. 
 (e) Within 30 days after the date of any payment of Taxes or Other Taxes withheld by the Borrower in respect of any payment to any Bank (or Transferee) or the Administrative Agent, the Borrower will furnish to the Administrative Agent, at
its address referred to in Section 10.01, the original or a certified copy of a receipt received by the Borrower evidencing payment thereof. 
 (f) Without prejudice to the survival of any other agreement contained herein, the agreements and obligations contained in this Section 2.17 shall survive the payment in full of the principal of and
interest on all Loans made hereunder. 
 (g) On or prior to the execution of this Agreement and on or before the transfer to a
Transferee, the Administrative Agent shall notify the Borrower of each Bank’s (or Transferee’s) address. On or prior to the Banks’ (or any Transferee’s) first Interest Payment Date, and from time to time as required by law, each
Bank (or Transferee) that is not a United States person within the meaning of Section 7701(a)(30) of the Code (a “Non-U.S. Person”) shall, if legally able to do so, deliver to the Borrower and the Administrative Agent
(i) one duly completed and executed copy of United States Internal Revenue Service Form W-8BEN or W-8ECI, (ii) if claiming exemption from United States Federal withholding tax pursuant to Section 871(h) or 881(c) of the Code, one duly
completed and executed copy of a United States Internal Revenue Service Form W-8BEN and a certificate representing that such Non-U.S. Person is not a bank for purposes of Section 881(c) of the Code, is not a 10 percent shareholder (within the
meaning of Section 871(h)(3)(b) of the Code) of the Borrower and is not a controlled foreign corporation related to the Borrower (within the meaning of Section 864(d)(4) of the Code) or (iii) any successor applicable form of any
thereof, establishing in each case that such Bank (or Transferee) is entitled to receive payments under the Loan Documents payable to it without deduction or withholding of any United States Federal income taxes, or is subject to a reduced rate
thereof. Unless the Borrower and the Administrative Agent have received forms or other documents satisfactory to them indicating that such payments under the Loan Documents are not subject to United States Federal withholding tax or are subject to
such tax at a rate reduced by an applicable tax treaty, the Borrower shall withhold taxes from such payments at the applicable statutory rate. 
  

 25 

 (h) The Borrower shall not be required to pay any additional amounts to any Bank (or
Transferee) in respect of United States Federal withholding tax pursuant to paragraph (a) above if the obligation to pay such additional amounts would not have arisen but for a failure by such Bank (or Transferee) to comply with the provisions
of paragraph (g) above; provided, however, that the Borrower shall be required to pay those amounts to any Bank (or Transferee) that it was required to pay hereunder prior to the failure of such Bank (or Transferee) to comply with
the provisions of such paragraph (g). 
 Section 2.18 Termination or Assignment of Commitments under Certain
Circumstances. 
 (a) Any Bank (or Transferee) claiming any additional amounts payable pursuant to Section 2.11 or
Section 2.17 or exercising its rights under Section 2.12 shall use reasonable efforts (consistent with legal and regulatory restrictions) to file any certificate or document requested by the Borrower or to change the jurisdiction of its
applicable lending office if the making of such a filing or change would avoid the need for or reduce the amount of any such additional amounts which may thereafter accrue or avoid the circumstances giving rise to such exercise and would not, in the
sole determination of such Bank, be otherwise disadvantageous to such Bank (or Transferee). 
 (b) In the event that any Bank
shall have delivered a notice or certificate pursuant to Section 2.12, or the Borrower shall be required to make additional payments under Section 2.11 or 2.17 to any Bank (or Transferee) or to the Administrative Agent with respect to any
Bank (or Transferee), the Borrower shall have the right, at its own expense, upon notice to such Bank (or Transferee) and the Administrative Agent, (i) to terminate the Commitment of such Bank (or Transferee) or (ii) to require such Bank
(or Transferee) to transfer and assign without recourse (in accordance with and subject to the restrictions contained in Section 10.04) all its interests, rights and obligations under the Loan Documents to another financial institution which
shall assume such obligations; provided that (A) no such termination or assignment shall conflict with any law, rule or regulation or order of any Governmental Authority and (B) the Borrower or the assignee, as the case may be,
shall pay to the affected Bank (or Transferee) in immediately available funds on the date of such termination or assignment the principal of and interest accrued to the date of payment on the Loans made by it hereunder and all other amounts accrued
for its account or owed to it under the Loan Documents. 
 (c) The Borrower shall have the right, at its own expense, upon
notice to a Defaulting Bank and the Administrative Agent, to replace such Defaulting Bank (a “Terminated Bank”) in accordance with and subject to the restrictions of Section 10.04, and such Terminated Bank hereby agrees
to assign without recourse (in accordance with and subject to the restrictions of Section 10.04) all of its interests, rights and obligations under the Loan Documents to one or more assignees; provided, however, that no Terminated Bank shall be
obligated to make any such assignment unless (i) such assignment does not conflict with any law, rule or regulation or order of any Governmental Authority and (ii) such Terminated Bank shall have been paid in immediately available funds on
the date of such assignment the principal of and interest accrued to the date of payment on the Loans made by such Terminated Bank and all fees and other amounts accrued for such Terminated Bank’s account or owed to it hereunder. Each Bank
agrees that, if it becomes a Terminated Bank, it will execute and deliver to the Administrative Agent an Assignment and Assumption to evidence the aforementioned assignment and shall deliver to the

  

 26 

 
Administrative Agent any Notes subject to such Assignment and Assumption; provided, however, that the failure of any Terminated Bank to execute an Assignment and Assumption shall not render such
assignment invalid, and the Administrative Agent shall record such assignment in its books and records. 
 Section 2.19
Extension of Expiration Date. 
 (a) If no Event of Default has occurred and is continuing, the Borrower may request, by
notice to the Administrative Agent and each Bank given no earlier than 45 days before, and no later than 30 days before, the Expiration Date applicable on the date of such notice (the “Current Expiration Date”), that the
Banks renew their respective Commitments for an additional 364 days. If a Bank agrees, in its sole and absolute discretion, to so renew its Commitment, it will give notice to the Administrative Agent of its decision to do so no earlier than 30 days
before, and no later than 20 days before, the Current Expiration Date. No later than 19 days before the Current Expiration Date (or the next Business Day, if the day 19 days before the Current Expiration Date is not a Business Day), the
Administrative Agent will notify the Borrower and each Bank as to the Banks (each a “Renewing Bank”) from which it has received such a notice agreeing to so renew. Any failure by a Bank to so notify the Administrative Agent
shall be deemed to be a decision by such Bank not to so renew its Commitment. 
 (b) If all Banks elect to so renew their
respective Commitments, and provided that the additional conditions specified in Section 4.03 shall have been satisfied, then on the Current Expiration Date the Expiration Date shall automatically become the date that is 364 days following the
Current Expiration Date. 
 (c) If, at the time the Administrative Agent gives the notice contemplated by
Section 2.19(a) to the Borrower and the Banks, the Commitments of the Renewing Banks aggregate at least 66 2/3%, but less than 100%, of the Commitments of all of the Banks at such time (the “Existing Commitments”), then (i) as to each Renewing Bank, on the
Current Expiration Date the Expiration Date shall automatically become the date that is 364 days following the Current Expiration Date, provided that the additional conditions specified in Section 4.03 shall have been satisfied, (ii) the
Expiration Date shall remain unchanged as to each Bank that is not a Renewing Bank (each a “Terminating Bank”), (iii) each Terminating Bank’s Commitment shall terminate on the Current Expiration Date, and
(iv) on the Current Expiration Date the Borrower shall pay the outstanding Loans owed to each Terminating Bank and all other amounts owed to each Terminating Bank. If, at the time the Administrative Agent gives the notice contemplated by
Section 2.19(a) to the Borrower and the Banks, the Commitments of the Renewing Banks aggregate less than 66 2/3% of the Existing Commitments, none of the Commitments (including the Commitment of any Renewing Bank) shall be extended, and the Expiration Date shall remain unchanged. 

 (d) The Borrower may undertake the process contemplated by this Section 2.19 once each year (commencing in 2011),
but the election by any Bank to become a Renewing Bank at any time shall not obligate such Bank to become a Renewing Bank at any other time, it being agreed that each election by any Bank to renew or not renew shall be made by such Bank in its sole
and absolute discretion and that such discretion shall not be limited by any prior election to become a Renewing Bank. 
  

 27 

 (e) If, at any time that the Administrative Agent gives a notice
contemplated by Section 2.19(a) to the Borrower and the Banks, the Commitments of the then Renewing Banks aggregate at least 66 2/3% but less than 100% of the then Existing Commitments, the Borrower shall have the right, without the consent of the Banks but subject to the consent of the
Administrative Agent (which consent shall not be unreasonably withheld), to replace the Commitments of the then Terminating Banks by adding to this Agreement one or more commercial banks or other financial institutions (which shall, upon completion
of the requirements stated in this Section 2.19, constitute Banks hereunder) or by allowing one or more Renewing Banks to increase their Commitments hereunder, provided that (i) such added and increased Commitments shall not be greater
than the Commitments of such Terminating Banks, so that in no event will the aggregate amount of the Existing Commitments be increased (after giving effect to the contemporaneous termination of the Commitments of such Terminating Banks),
(ii) no Renewing Bank’s Commitment shall be increased without the consent of such Renewing Bank, and (iii) the additional conditions specified in Section 4.03 shall have been satisfied. The Borrower shall give the Administrative
Agent three Business Days’ notice of the Borrower’s intention to increase any Commitment or add a new commercial bank or other financial institution pursuant to this Section 2.19. Such notice shall specify each new commercial bank or
other financial institution, if any, the changes in amounts of Commitments that will result and such other information as is reasonably requested by the Administrative Agent. Each new commercial bank or other financial institution agreeing to be
added to this Agreement, and each Renewing Bank agreeing to increase its Commitment, shall execute and deliver to the Administrative Agent an agreement substantially in the form of Exhibit E (a “Commitment Extension
Supplement”), pursuant to which it shall become a party hereto or increase its Commitment, as the case may be. In addition, the Borrower shall execute and deliver a Note in the principal amount of the Commitment of each new Bank, or a
replacement Note in the principal amount of the increased Commitment of each Renewing Bank agreeing to increase its Commitment, if and to the extent requested pursuant to Section 2.04(e). Upon execution by the Administrative Agent of the
relevant Commitment Extension Supplement, each such new commercial bank or financial institution shall constitute a “Bank” hereunder with a Commitment as specified therein, or such Renewing Bank’s Commitment shall increase as
specified therein, as the case may be. 
 ARTICLE III 
 REPRESENTATIONS AND WARRANTIES 
 The Borrower
represents and warrants to each of the Banks that: 
 Section 3.01 Organization; Powers. Each of the Borrower and
the Significant Subsidiaries (a) is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, (b) has all requisite power and authority to own its property and assets and to
carry on its business as now conducted and as proposed to be conducted, (c) is qualified to do business in every jurisdiction where such qualification is required, except where the failure so to qualify would not result in a Material Adverse
Effect,

  

 28 

 
and (d) in the case of the Borrower, has the corporate power and authority to execute, deliver and perform its obligations under each of the Loan Documents and each other agreement or
instrument contemplated thereby to which it is or will be a party and to borrow hereunder. 
 Section 3.02
Authorization. The execution, delivery and performance by the Borrower of each of the Loan Documents and the Borrowings (collectively, the “Transactions”) (a) have been duly authorized by all requisite corporate
and, if required, stockholder action and (b) will not (i) violate (A) any provision of law, statute, rule or regulation the violation of which could reasonably be expected to impair the validity and enforceability of this Agreement or
any other Loan Document or materially impair the rights of or benefits available to the Banks under the Loan Documents, or of the certificate or articles of incorporation or other constitutive documents or bylaws of the Borrower or any Significant
Subsidiary, (B) any order of any Governmental Authority the violation of which could reasonably be expected to impair the validity or enforceability of this Agreement or any other Loan Document, or materially impair the rights of or benefits
available to the Banks under the Loan Documents, or (C) any provision of any indenture or other material agreement or instrument evidencing or relating to borrowed money to which the Borrower or any Significant Subsidiary is a party or by which
any of them or any of their property is or may be bound in a manner which could reasonably be expected to impair the validity and enforceability of this Agreement or any other Loan Document or materially impair the rights of or benefits available to
the Banks under the Loan Documents, (ii) be in conflict with, result in a breach of or constitute (alone or with notice or lapse of time or both) a default under any such indenture, agreement or other instrument in a manner which could
reasonably be expected to impair the validity and enforceability of this Agreement or any other Loan Document or materially impair the rights of or benefits available to the Banks under the Loan Documents or (iii) result in the creation or
imposition under any such indenture, agreement or other instrument of any Lien upon or with respect to any property or assets now owned or hereafter acquired by the Borrower. 
 Section 3.03 Enforceability. This Agreement has been duly executed and delivered by the Borrower and constitutes, and each other
Loan Document when executed and delivered by the Borrower will constitute, a legal, valid and binding obligation of the Borrower enforceable against the Borrower in accordance with its terms. 
 Section 3.04 Governmental Approvals. No action, consent or approval of, registration or filing with or any other action by any
Governmental Authority is or will be required in connection with the Transactions, except such as have been made or obtained and are in full force and effect. 
 Section 3.05 Financial Statements. The Borrower has heretofore furnished to the Banks its (a) consolidated balance sheets and statements of income and statements of cash flow as of and
for the fiscal year ended December 31, 2008, audited by and accompanied by the opinion of Deloitte & Touche LLP, independent public accountants, and (b) unaudited consolidated balance sheets and statements of income and statements
of cash flow as of and for the fiscal quarter ended September 30, 2009, certified by one of its Financial Officers. All such financial statements present fairly the financial condition and results of operations of the Borrower and its
consolidated subsidiaries as of such dates and for such periods. Such balance sheets and the notes

  

 29 

 
thereto, together with the Borrower’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008, reflect all liabilities, direct or contingent, of the Borrower and its
consolidated Subsidiaries as of the dates thereof which are material on a consolidated basis. Such financial statements were prepared in accordance with GAAP applied (except as noted therein) on a consistent basis. 
 Section 3.06 No Material Adverse Change. Except as disclosed in the Borrower’s Annual Report on Form 10-K for the fiscal
year ended December 31, 2008 and in any document filed after December 31, 2008, but prior to the date of this Agreement, pursuant to Section 13(a), 14 or 15(d) of the Securities Exchange Act of 1934, there has been no change in the
business, assets, operations or financial condition of the Borrower and the Subsidiaries, taken as a whole, since December 31, 2008, which could reasonably be expected to have a Material Adverse Effect. For the avoidance of doubt, the
representation set forth in this Section 3.06 is and will be made solely at and as of the Closing Date, at and as of the effective date of any increase in the Commitments pursuant to Section 2.09(c) and at and as of the effective
date of any extension of the Expiration Date pursuant to Section 2.19. 
 Section 3.07 Litigation; Compliance with
Laws. 
 (a) Except as set forth in the Annual Report of the Borrower on Form 10-K for the year ended December 31, 2008,
or in any document filed after December 31, 2008, but prior to the date of this Agreement pursuant to Section 13(a), 14 or 15(d) of the Securities Exchange Act of 1934, there are not any actions, suits or proceedings at law or in equity or
by or before any Governmental Authority now pending or, to the knowledge of the Borrower, threatened against or affecting the Borrower or any Subsidiary or any business, property or rights of any such person (i) which involve any Loan Document
or the Transactions or (ii) which could reasonably be anticipated, individually or in the aggregate, to result in a Material Adverse Effect. 
 (b) Neither the Borrower nor any of the Subsidiaries is in violation of any law, rule or regulation, or in default with respect to any judgment, writ, injunction or decree of any Governmental Authority,
where such violation or default would be reasonably likely to result in a Material Adverse Effect. 
 Section 3.08
Federal Reserve Regulations. 
 (a) Neither the Borrower nor any of the Subsidiaries is engaged principally, or as one of
its important activities, in the business of extending credit for the purpose of purchasing or carrying Margin Stock. 
 (b) No
part of the proceeds of any Loan will be used, whether directly or indirectly, and whether immediately, incidentally or ultimately, (i) to purchase or carry Margin Stock or to extend credit to others for the purpose of purchasing or carrying
Margin Stock or to refund indebtedness originally incurred for such purpose, or (ii) for any purpose which entails a violation of, or which is inconsistent with, the provisions of the Regulations of the Board, including Regulation U or X.

  

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 Section 3.09 Investment Company Act. The Borrower is not an “investment
company” as defined in, or subject to regulation under, the Investment Company Act of 1940. 
 Section 3.10 No
Material Misstatements. No information, report, financial statement, exhibit or schedule furnished by or on behalf of the Borrower to the Administrative Agent or any Bank in connection with the negotiation of any Loan Document or included
therein or delivered pursuant thereto contained, contains or will contain any material misstatement of fact or, when considered together with all reports theretofore filed with the Securities and Exchange Commission, omitted, omits or will omit to
state any material fact necessary to make the statements therein, in the light of the circumstances under which they were, are or will be made, not misleading. 
 Section 3.11 Employee Benefit Plans. Each of the Borrower and its ERISA Affiliates is in compliance in all material respects with the applicable provisions of ERISA and the regulations and
published interpretations thereunder. No Reportable Event has occurred as to which the Borrower or any ERISA Affiliate was required to file a report with the PBGC. The value of the assets of each Plan is at least 80% of the “funding
target” (as defined in Code Section 430(d)(1)) of such Plan as of the last annual valuation date applicable thereto. 
 Section 3.12 Environmental and Safety Matters. Each of the Borrower and the Subsidiaries has complied with all Federal, state, local and other statutes, ordinances, orders, judgments, rulings and regulations relating to
environmental pollution or to environmental or nuclear regulation or control or to employee health or safety, except where noncompliance would not be reasonably likely to result in a Material Adverse Effect. Neither the Borrower nor any Subsidiary
has received notice of any failure so to comply, except where noncompliance would not be reasonably likely to result in a Material Adverse Effect. The Borrower’s and the Subsidiaries’ plants do not manage any hazardous wastes, hazardous
substances, hazardous materials, toxic substances, toxic pollutants or substances similarly denominated, as those terms or similar terms are used in the Resource Conservation and Recovery Act, the Comprehensive Environmental Response Compensation
and Liability Act, the Hazardous Materials Transportation Act, the Toxic Substance Control Act, the Clean Air Act, the Clean Water Act or any other applicable law relating to environmental pollution or employee health and safety, or any nuclear fuel
or other radioactive materials, in all cases in violation of any law or any regulations promulgated pursuant thereto, where such violation would be reasonably likely to result in a Material Adverse Effect. The Borrower is aware of no events,
conditions or circumstances involving environmental pollution or contamination or employee health or safety that could reasonably be expected to result in a Material Adverse Effect. The representations and warranties set forth in this
Section 3.12 are, however, subject to any matters, circumstances or events set forth in the Borrower’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008 and in any document filed after December 31, 2008, but
prior to the date of this Agreement pursuant to Section 13(a), 14 or 15(d) of the Securities Exchange Act of 1934; provided, however, that the inclusion of such matters, circumstances or events as exceptions (or any other
exceptions contained in the representations and warranties which refer to the Borrower’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008 or in any document filed after December 31, 2008, but prior to the date of
this Agreement pursuant to Section 13(a), 14 or 15(d) of the Securities Exchange Act of 1934) shall not be construed to mean that the Borrower has concluded that any such matter, circumstance or effect is likely to result in a Material Adverse
Effect. 
  

 31 

 Section 3.13 Significant Subsidiaries. Schedule 3.13 sets forth as of the date
hereof a list of all Significant Subsidiaries of the Borrower and the percentage ownership interest of the Borrower therein. 
 ARTICLE IV 
 CONDITIONS TO BORROWINGS AND EXTENSIONS 
 Section 4.01 All Borrowings. The obligations of the Banks to make Loans on the date of each Borrowing (including the first
Borrowing under this Agreement and each Borrowing in which Loans are refinanced with new Loans as contemplated by Section 2.02(f)) are subject to the satisfaction of the following conditions: 
 (a) The Administrative Agent shall have received a notice of such Borrowing as required by Section 2.03. 
 (b) The representations and warranties set forth in Article III hereof (excluding, in the case of a refinancing of Loans, the
representations set forth in Section 3.07 and, in the case of any Borrowing (including each Borrowing in which Loans are refinanced with new Loans) after the Closing Date, the representation set forth in Section 3.06) shall be true and
correct in all material respects on and as of the date of such Borrowing with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date. 
 (c) The Borrower shall be in compliance with all the terms and provisions set forth herein and in each other Loan Document on its part to be
observed or performed, and at the time of and immediately after such Borrowing no Event of Default or Default shall have occurred and be continuing. 
 Each Borrowing shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the matters specified in paragraphs (b) and (c) of this Section 4.01. 
 Section 4.02 First Borrowing. The obligations of the Banks to make Loans on the date of the first Borrowing under this Agreement
are subject to the satisfaction of the following conditions: 
 (a) The Administrative Agent shall have received each of the
following, in form and substance satisfactory to it: 
 (i) Opinions of Davis Wright Tremaine LLP, counsel to the Borrower,
Hawley Troxell Ennis & Hawley LLP, Idaho counsel to the Borrower, and Crowley Fleck PLLP, Montana counsel to the Borrower (or such other firm or firms approved by the Administrative Agent), each dated the date of this Agreement and
addressed to the Administrative Agent and the Banks, with respect to such matters relating to the Borrower and the Loan Documents as the Administrative Agent or any Bank may reasonably request. The Borrower hereby instructs such counsel to deliver
such opinion to the Administrative Agent. 
  

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 (ii) Evidence satisfactory to the Administrative Agent and set forth on Schedule
4.02(a)(ii) that the Borrower shall have obtained all consents and approvals of, and shall have made all filings and registrations with, any Governmental Authority required in order to consummate the Transactions, in each case without the imposition
of any condition which, in the judgment of the Banks, could adversely affect their rights or interests under the Loan Documents. 
 (iii) A copy of the certificate or articles of incorporation, including all amendments thereto, of the Borrower, certified as of a recent date by the Secretary of State of the state of its organization, and a certificate as to the good
standing of the Borrower as of a recent date, from such Secretary of State. 
 (iv) A certificate of the Secretary or Assistant
Secretary of the Borrower dated the date of this Agreement and certifying (A) that attached thereto is a true and complete copy of the bylaws of the Borrower as in effect on the date of this Agreement and at all times since a date prior to the
date of the resolutions described in clause (B) below, (B) that attached thereto is a true and complete copy of resolutions duly adopted by the board of directors of the Borrower authorizing the execution, delivery and performance of the
Loan Documents and borrowings hereunder, and that such resolutions have not been modified, rescinded or amended and are in full force and effect, (C) that the certificate or articles of incorporation of the Borrower have not been amended since
the date of the last amendment thereto shown on the certification with respect thereto furnished pursuant to clause (iii) above, and (D) as to the incumbency and specimen signature of each officer executing any Loan Document or any other
document delivered in connection therewith on behalf of the Borrower. 
 (v) A certificate of another officer of the Borrower
as to the incumbency and specimen signature of the Secretary or Assistant Secretary executing the certificate pursuant to clause (iv) above. 
 (vi) A certificate, dated the date of this Agreement and signed by a Financial Officer of the Borrower, confirming compliance with the conditions precedent set forth in paragraphs (b) and (c) of
Section 4.01. 
 (vii) Evidence satisfactory to the Administrative Agent that this Agreement, the Supplemental Indenture,
the Bond Delivery Agreement, the First Mortgage Bond and any Notes requested by the Banks for issuance on the date of this Agreement have been executed and delivered by all parties thereto. 
 (viii) A copy of the First Mortgage, certified by the Secretary or Assistant Secretary of the Borrower. 
  

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 (ix) A copy of title insurance policy No. NSL 31426-SEA issued by First American Title
Insurance Company, together with copies of all endorsements thereto (including an endorsement extending the coverage of such policy to the Supplemental Indenture and the First Mortgage Bond), naming the trustee under the First Mortgage as the
insured, insuring the Borrower’s title to the real property subject to the Lien of the First Mortgage, and the validity and first priority of the Lien of the First Mortgage (subject to Liens permitted to exist by the terms of the First
Mortgage), in an amount not less than $785,000,000. 
 (x) Such other documents as the Administrative Agent, the Banks or their
respective legal counsel may reasonably request. 
 (b) All fees payable by the Borrower to the Administrative Agent, the
“Co-Lead Arrangers” identified on the cover page of this Agreement, the Banks or any of their Affiliates on or prior to the date of this Agreement with respect to this Agreement, and all amounts payable by the Borrower pursuant to
Section 10.05 for which invoices have been delivered to the Borrower on or prior to such date, shall have been paid in full or arrangements satisfactory to the Administrative Agent shall have been made to cause them to be paid in full
concurrently with the disbursement of the proceeds of any Borrowing to be made on such date. 
 (c) All legal matters incident
to the Loan Documents and the transactions contemplated thereby shall be reasonably satisfactory to the Administrative Agent, the Banks and their respective legal counsel. 
 Section 4.03 Extensions. Each extension of the Expiration Date pursuant to Section 2.19 is subject to the satisfaction of
the following additional conditions on the effective date of such extension: 
 (a) No Loans shall be outstanding on the date of
such extension. 
 (b) The representations and warranties set forth in Article III shall be true and correct in all
material respects on and as of the date of such extension with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date. 
 (c) The Borrower shall be in compliance with all the terms and provisions set forth herein and in each other Loan Document on its part to be
observed or performed, and at the time of and immediately after such extension no Event of Default or Default shall have occurred and be continuing. 
 Each extension of the Expiration Date shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the matters specified in paragraphs (b) and (c) of this Section 4.03. 
  

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 ARTICLE V 
 AFFIRMATIVE COVENANTS 
 The Borrower covenants and agrees with each Bank
that so long as any Commitment shall remain in effect or the principal of or interest on any Loan, any Fees or any other amounts payable under any Loan Document shall be unpaid: 
 Section 5.01 Existence; Businesses and Properties. 
 (a) The Borrower shall, and shall cause each Significant Subsidiary to, do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence, except as
otherwise expressly permitted under Section 6.03. 
 (b) The Borrower shall, and shall cause each Significant Subsidiary
to, (i) do or cause to be done all things necessary to obtain, preserve, renew, extend and keep in full force and effect the rights, licenses, permits, franchises, authorizations, patents, copyrights, trademarks and trade names utilized in the
conduct of its business, except where the failure so to obtain, preserve, renew, extend or maintain any of the foregoing would not result in a Material Adverse Effect; (ii) maintain and operate its business in substantially the manner in which
it is presently conducted and operated, except as otherwise expressly permitted under this Agreement; (iii) comply in all material respects with all applicable laws, rules, regulations and orders of any Governmental Authority, whether now in
effect or hereafter enacted if failure to comply with such requirements would result in a Material Adverse Effect; and (iv) at all times maintain and preserve all property material to the conduct of its business and keep such property in good
repair, working order and condition and from time to time make, or cause to be made, all needful and proper repairs, renewals, additions, improvements and replacements thereto necessary in order that the business carried on in connection therewith
may be properly conducted at all times; provided, however, that the Borrower or any Significant Subsidiary may cause the discontinuance of the operation or a reduction in the capacity of any of its facilities, or any element or unit
thereof, including real and personal properties, facilities, machinery and equipment, (A) if, in the judgment of the Borrower or such Significant Subsidiary, it is no longer advisable to operate the same, or to operate the same at its former
capacity, and such discontinuance or reduction would not result in a Material Adverse Effect, or (B) if the Borrower or a Significant Subsidiary intends to sell and dispose of its interest in the same in accordance with the terms of this
Agreement and within a reasonable time shall endeavor to effectuate the same. 
 Section 5.02 Insurance. 

(a) The Borrower shall, and shall cause each Significant Subsidiary to, (i) maintain insurance, to such extent and against such
risks, as is customary with companies in the same or similar businesses and owning similar properties in the same general area in which it operates and (ii) maintain such other insurance as may be required by law. All insurance required by this
Section 5.02 shall be maintained with financially sound and reputable insurers or through self-insurance; provided, however, that the portion of such insurance constituting self-insurance shall be comparable to that usually
maintained by companies engaged in the same or similar

  

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businesses and owning similar properties in the same general area in which the Borrower or such Significant Subsidiary, as applicable, operates and the reserves maintained with respect to such
self-insured amounts are deemed adequate by its officer or officers responsible for insurance matters. 
 Section 5.03
Taxes and Obligations. The Borrower shall, and shall cause each Significant Subsidiary to, pay and discharge promptly when due all taxes, assessments and governmental charges or levies imposed upon it or upon its income or profits or in
respect of its property, before the same shall become delinquent or in default, as well as all lawful claims for labor, materials and supplies or otherwise which, if unpaid, might give rise to a Lien upon such properties or any part thereof;
provided, however, that such payment and discharge shall not be required with respect to any such tax, assessment, charge, levy or claim so long as the validity or amount thereof shall be contested in good faith by appropriate
proceedings and the Borrower shall, to the extent required by GAAP, have set aside on its books adequate reserves with respect thereto. 
 Section 5.04 Financial Statements, Reports, etc. The Borrower shall furnish to the Administrative Agent and each Bank: 
 (a) within 105 days after the end of each fiscal year, consolidated and consolidating balance sheets and related statements of income and
statements of cash flow, showing the financial condition of (i) Avista Utilities and (ii) the Borrower and its consolidated Subsidiaries, in each case as of the close of such fiscal year, and the results of each of their operations during
such year, all (A) in the case of Avista Utilities, certified by one of the Borrower’s Financial Officers as fairly presenting the financial condition and results of operations of Avista Utilities in accordance with GAAP consistently
applied and (B) in the case of the Borrower and its consolidated subsidiaries, audited by Deloitte & Touche LLP or other independent public accountants of recognized national standing acceptable to the Required Banks and accompanied by
an opinion of such accountants (which shall not be qualified in any material respect) to the effect that such consolidated financial statements fairly present the financial condition and results of operations of the Borrower on a consolidated basis
(except as noted therein) in accordance with GAAP consistently applied; 
 (b) within 50 days after the end of each of the first
three fiscal quarters of each fiscal year, consolidated and, to the extent otherwise available, consolidating balance sheets and related statements of income and statements of cash flow, showing the financial condition of (i) Avista Utilities
and (ii) the Borrower and its consolidated subsidiaries, in each case as of the close of such fiscal quarter, and the results of each of their operations during such fiscal quarter and the then elapsed portion of the fiscal year, all certified
by one of its Financial Officers as fairly presenting the financial condition and results of operations of Avista Utilities or the Borrower on a consolidated basis, as applicable, in accordance with GAAP consistently applied, subject to normal
year-end audit adjustments; 
 (c) concurrently with any delivery of financial statements under (a) or (b) above,
(i) a certificate of the relevant accounting firm opining on or certifying such statements or Financial Officer (which certificate, when furnished by an accounting firm, may be limited to

  

 36 

 
accounting matters and disclaim responsibility for legal interpretations) certifying that to the knowledge of the accounting firm or the Financial Officer, as the case may be, no Event of Default
or Default has occurred or, if an Event of Default or Default has occurred, specifying the nature and extent thereof and any corrective action taken or proposed to be taken with respect thereto, and (ii) a certificate of a Financial Officer of
the Borrower setting forth in reasonable detail such calculations as are required to establish whether the Borrower was in compliance with Sections 6.05 and 6.06 on the date of such financial statements; 
 (d) promptly after the same become publicly available, copies of all periodic and other reports, proxy statements and other materials filed
by it with the Securities and Exchange Commission, or any Governmental Authority succeeding to any of or all the functions of said Commission, or with any national securities exchange, or distributed to its shareholders, as the case may be; and

 (e) promptly, from time to time, such other information regarding the operations, business affairs and financial condition of
the Borrower or any Significant Subsidiary, or compliance with the terms of any Loan Document, as the Administrative Agent or any Bank may reasonably request. 
 Section 5.05 Litigation and Other Notices. The Borrower shall furnish to the Administrative Agent and each Bank prompt notice of the following: 
 (a) any Event of Default or Default, specifying the nature and extent thereof and the corrective action (if any) proposed to be taken with
respect thereto; 
 (b) the filing or commencement of, or any written threat or notice of intention of any person to file or
commence, any action, suit or proceeding, whether at law or in equity or by or before any Governmental Authority, against the Borrower or any Subsidiary which could reasonably be anticipated to result in a Material Adverse Effect; and 
 (c) any development that has resulted in, or could reasonably be anticipated to result in, a Material Adverse Effect. 
 Section 5.06 ERISA. The Borrower shall, and shall cause each Significant Subsidiary to, comply in all material respects with the
applicable provisions of ERISA, and the Borrower shall furnish to the Administrative Agent and each Bank (a) as soon as possible, and in any event within 30 days after any Responsible Officer of the Borrower or any ERISA Affiliate either knows
or has reason to know that any Reportable Event has occurred that alone or together with any other Reportable Event could reasonably be expected to result in liability of the Borrower to the PBGC in an aggregate amount exceeding $25,000,000, a
statement of a Financial Officer of the Borrower setting forth details as to such Reportable Event and the action proposed to be taken with respect thereto, together with a copy of the notice, if any, of such Reportable Event given to the PBGC,
(b) as soon as possible, and in any event within 30 days after any Responsible Officer of the Borrower or any ERISA Affiliate either knows or has reason to know that the value of the assets of any Plan is less than 80% of the “funding
target” (as defined in Code Section 430(d)(1)) of such Plan as of the last annual valuation date applicable thereto, a

  

 37 

 
statement of a Financial Officer of the Borrower setting forth details as to such event, (c) promptly after receipt thereof, a copy of any notice the Borrower or any ERISA Affiliate may
receive from the PBGC relating to the intention of the PBGC to terminate any Plan or Plans (other than a Plan maintained by an ERISA Affiliate which is considered an ERISA Affiliate only pursuant to subsection (m) or (o) of
Section 414 of the Code) or to appoint a trustee to administer any Plan or Plans and (d) within 10 days after the due date for filing with the PBGC pursuant to Section 430(k) of the Code of a notice of failure to make a required
installment or other payment with respect to a Plan, a statement of a Financial Officer of the Borrower setting forth details as to such failure and the action proposed to be taken with respect thereto, together with a copy of such notice given to
the PBGC. 
 Section 5.07 Maintaining Records; Access to Properties and Inspections. The Borrower shall, and shall
cause each Significant Subsidiary to, (a) maintain all financial records in accordance with GAAP and (b) permit any representatives designated by the Administrative Agent or any Bank to visit and inspect its financial records and
properties at reasonable times and as often as requested and to make extracts from and copies of such financial records, and permit any representatives designated by the Administrative Agent or any Bank to discuss its affairs, finances and condition
with its chief financial officer, or other person designated by the chief financial officer, and independent accountants therefor. 
 Section 5.08 Use of Proceeds. The Borrower shall use the proceeds of the Loans only for the purposes set forth in the preamble to this Agreement. 
 ARTICLE VI 
 NEGATIVE COVENANTS 
 The Borrower covenants and agrees with each Bank that so long as any Commitment shall remain in effect or the principal of or interest on
any Loan, any Fees or any other amounts payable under any Loan Document shall be unpaid: 
 Section 6.01 Liens. The
Borrower shall not create, incur, assume or permit to exist any Lien on any property or assets (including stock or other securities of any person, including any Subsidiary) now owned or hereafter acquired by it or on any income or revenues or rights
in respect of any thereof, except: 
 (a) Liens on property or assets of the Borrower created by the documents, instruments or
agreements existing on the date hereof and which are listed as exhibits to the Borrower’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008, to the extent that such Liens secure only obligations arising under such
existing documents, agreements or instruments and the amount of Indebtedness secured thereby does not exceed the amount thereof as of the date hereof as set forth on Schedule 6.01; 
 (b) any Lien existing on any property or asset prior to the acquisition thereof by the Borrower; provided that (i) such Lien is
not created in contemplation of or in connection with such acquisition and (ii) such Lien does not apply to any other property or assets of the Borrower; 
  

 38 

 (c) the Lien of the First Mortgage and the Lien of any collateral trust mortgage or similar
instrument which would be intended to eventually replace (in one transaction or a series of transactions) the First Mortgage (as amended, modified or supplemented from time to time, “Collateral Trust Mortgage”) on properties
or assets of the Borrower to secure bonds, notes and other obligations of the Borrower but only to the extent such Liens, collectively, secure Indebtedness, whether now existing or hereafter created, in an aggregate amount no greater than the
aggregate amount of first mortgage bonds permitted to be issued under the First Mortgage; 
 (d) Liens not prohibited under the
First Mortgage or the Collateral Trust Mortgage (whether or not such Liens cover properties or assets subject to the Lien of the First Mortgage or the Collateral Trust Mortgage); 
 (e) Liens for taxes, assessments or governmental charges not yet due or which are being contested in compliance with Section 5.03;

 (f) carriers’, warehousemen’s, mechanic’s, materialmen’s, repairmen’s or other like Liens arising in
the ordinary course of business and securing obligations that are not due or which are being contested in compliance with Section 5.03; 
 (g) pledges and deposits made in the ordinary course of business in compliance with workmen’s compensation, unemployment insurance and other social security laws or regulations; 
 (h) Liens incurred or created in connection with or to secure the performance of bids, tenders, trade contracts (other than for
Indebtedness), leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business; 
 (i) zoning restrictions, easements, rights-of-way, restrictions on use of real property and other similar encumbrances incurred in the
ordinary course of business which, in the aggregate, are not substantial in amount and do not materially detract from the value of the property subject thereto or interfere with the ordinary conduct of the business of the Borrower or any of its
Subsidiaries; 
 (j) Liens (i) which secure obligations not assumed by the Borrower, (ii) on account of which the
Borrower has not and does not expect to pay interest directly or indirectly and (iii) which exist upon real estate or rights in or relating to real estate in respect of which the Borrower has a right-of-way or other easement for purposes of
substations or transmission or distribution facilities; 
 (k) rights reserved to or vested in any federal, state or local
governmental body or agency by the terms of any right, power, franchise, grant, license, contract or permit, or by any provision of law, to recapture or to purchase, or designate a purchase of or order the sale of, any property of the Borrower or to
terminate any such right, power, franchise, grant, license, contract or permit before the expiration thereof; 
  

 39 

 (l) Liens of judgments covered by insurance, or upon appeal and covered by bond, or to the
extent not so covered not exceeding at one time $40,000,000 in aggregate amount; 
 (m) any Liens, moneys sufficient for the
discharge of which shall have been deposited in trust with the trustee or mortgagee under the instrument evidencing such Lien, with irrevocable authority of such trustee or mortgagee to apply such moneys to the discharge of such Lien to the extent
required for such purpose; 
 (n) rights reserved to or vested in any federal, state or local governmental body or agency or
other public authority to control or regulate the business or property of the Borrower; 
 (o) any obligations or duties
affecting the property of the Borrower to any federal, state or local governmental body or agency or other public authority with respect to any authorization, permit, consent or license of such body, agency or authority, given in connection with the
purchase, construction, equipping, testing and operation of the Borrower’s utility property; 
 (p) with respect to any
property which the Borrower may hereafter acquire, any exceptions or reservations therefrom existing at the time of such acquisition or any terms, conditions, agreements, covenants, exceptions and reservations expressed or provided in the deeds or
other instruments, respectively, under and by virtue of which the Borrower shall hereafter acquire such property, none of which terms, conditions, agreements, covenants, exceptions and reservations materially impairs the use of such property for the
purposes for which it is acquired by the Borrower; 
 (q) leases and subleases entered into in the ordinary course of business;

 (r) banker’s Liens and other Liens in the nature of a right of setoff; 
 (s) renewals, replacements, amendments, modifications, supplements, refinancings or extensions of Liens set forth in clauses
(a)-(d) above to the extent that the principal amount of Indebtedness secured by such Lien immediately prior thereto is not increased and such Lien is not extended to other property; 
 (t) security deposits or amounts paid into trust funds for the reclamation of mining properties; 
 (u) restrictions on transfer or use of properties and assets, first rights of refusal, and rights to acquire properties and assets granted
to others; 
  

 40 

 (v) non-consensual equitable Liens on the Borrower’s tenant-in-common or other interest
in joint projects; 
 (w) Liens on the Borrower’s tenant-in-common or other interest in joint projects incurred by the
project sponsor without the express consent of the Borrower to such incurrence; and 
 (x) Liens on receivables and related
properties or interests therein. 
 Section 6.02 Sale-Leaseback Transactions. The Borrower shall not enter into any
Sale-Leaseback if as a result thereof the aggregate outstanding principal amount of Attributable Debt outstanding in connection with all Sale-Leasebacks entered into after the date hereof would exceed 5% of the total tangible assets of Avista
Utilities as of the date of the financial statements most recently delivered under Section 5.04(a) or (b) at such time. 
 Section 6.03 Mergers, Consolidations and Acquisitions. The Borrower shall not, and shall not permit any Significant Subsidiary (without the consent of the Required Banks, not to be unreasonably withheld) to, merge with or into
or consolidate with any other person, or purchase, lease or otherwise acquire (in one transaction or a series of transactions) all or substantially all of the assets of any other person (whether directly by purchase, lease or other acquisition of
all or substantially all of the assets of such person or indirectly by purchase or other acquisition of all or substantially all of the capital stock of such other person) other than acquisitions in the ordinary course of the Borrower’s or such
Significant Subsidiary’s business, except that, if at the time thereof and immediately after giving effect thereto no Event of Default or Default shall have occurred and be continuing, (a) the Borrower or any Significant Subsidiary may
merge with or into or consolidate with the Borrower or any Subsidiary, provided that, in any transaction involving the Borrower, the Borrower is the surviving person, (b) the Borrower or any Significant Subsidiary may purchase, lease or
otherwise acquire from any Subsidiary all or substantially all of its assets, (c) the Borrower may merge with or into or consolidate with any other person so long as (i) in the case where the business of such other person, or an Affiliate
of such other person, entirely or primarily consists of an electric or gas utility business, (A) if the Borrower is the surviving person, then, immediately after such merger or consolidation, the Senior Debt Rating assigned to the applicable
Indebtedness of the Borrower by two nationally recognized credit-rating agencies shall be equal to or higher than Lowest Investment Grade and (B) if the Borrower is not the surviving person, (1) the surviving person shall assume in writing
the obligations of the Borrower under this Agreement and any other Loan Documents and (2) immediately after such merger or consolidation, the ratings assigned to the most senior secured public Indebtedness of the surviving person by two
nationally recognized credit rating agencies shall be equal to or higher than the ratings comparable to the Second Lowest Investment Grade, and (ii) in the case where such other person’s business does not entirely or primarily consist of
an electric or gas utility business, (A) the assets of such person at the time of such consolidation or merger do not exceed 10% of the total assets of the Borrower and its Subsidiaries after giving effect to such merger or consolidation,
computed and consolidated in accordance with GAAP consistently applied and (B) if the Borrower is not the surviving person, the surviving person shall assume in writing the obligations of the Borrower under this Agreement and any other Loan
Documents, (d) the Borrower may purchase, lease or otherwise

  

 41 

 
acquire all or substantially all of the assets of any other person (including by purchase or other acquisition of all or substantially all of the capital stock of such person) so long as
(i) the assets being purchased, leased or acquired (or the assets of the person whose capital stock is being acquired) entirely or primarily consist of electric or gas utility assets or (ii) in the case where the assets being purchased,
leased or acquired (or the assets of the person whose capital stock is being acquired) do not entirely or primarily consist of electric or gas utility assets, the assets being purchased, leased or acquired (or the Borrower’s proportionate share
of the assets of the person whose capital stock is being acquired) do not exceed 10% of the total assets of the Borrower and its Subsidiaries, after giving effect to such purchase, lease or acquisition, computed and consolidated in accordance with
GAAP consistently applied, (e) any Significant Subsidiary may merge with or into or consolidate with any other person so long as the assets of such person at the time of such merger or consolidation do not exceed 10% of the total assets of the
Borrower and its Subsidiaries after giving effect to such merger or consolidation, computed and consolidated in accordance with GAAP consistently applied, and (f) any Significant Subsidiary may purchase, lease or otherwise acquire all or
substantially all of the assets of any other person (including by purchase or other acquisition of all or substantially all of the capital stock of such person) so long as the assets being purchase, leased or acquired (or the Significant
Subsidiary’s proportionate share of the assets of the person whose capital stock is being acquired) do not exceed 10% of the total assets of the Borrower and its Subsidiaries after giving effect to such purchase, lease or acquisition, computed
and consolidated in accordance with GAAP consistently applied; provided, however, that notwithstanding anything in this Section 6.03 to the contrary, this Section 6.03 shall not be deemed to prohibit any merger, consolidation
or acquisition involving a Significant Subsidiary (and not also the Borrower) if, after giving effect to the consummation of such transaction, such Significant Subsidiary shall have or be deemed to have a ratio of total long-term Indebtedness to
total stockholders’ equity equal to or less than 1.5 to 1.0. 
 Section 6.04 Disposition of Assets. The
Borrower shall not, and shall not permit any Significant Subsidiary (without the consent of the Required Banks, not to be unreasonably withheld) to, sell, lease, transfer, assign or otherwise dispose of any assets or any interest therein (whether
now owned or hereafter acquired), except (a) dispositions of obsolete or retired property not used or useful in its business, (b) grants of Liens by the Borrower permitted under Section 6.01 and grants of Liens by Significant
Subsidiaries, (c) disposition by the Borrower of its interest in the Washington Public Power Supply System Nuclear Project No. 3 in accordance with the settlement agreement among the Borrower, the Washington Public Power Supply System and
Bonneville Power Administration, as the same may be amended, modified or supplemented from time to time, (d) disposition by the Borrower of all or any portion of its transmission assets in one or more RTO Transactions, (e) disposition by
the Borrower of its interests in the Colstrip Project and related assets, (f) disposition of receivables and related properties or interests therein, and (g) other dispositions of assets (not otherwise permitted by clauses (a)-(f) of
this Section) made in the ordinary course of business not exceeding in any fiscal year 5% of the assets of the Borrower and its Subsidiaries as of the end of the prior fiscal year, computed and consolidated in accordance with GAAP consistently
applied, and (h) other dispositions of assets (not otherwise permitted by clauses (a)-(f) of this Section) not exceeding in any fiscal year 10% of the assets of the Borrower and its Subsidiaries as of the end of the prior fiscal year,
computed and consolidated in accordance with GAAP consistently applied; provided,

  

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however, that notwithstanding anything in this Section 6.04 to the contrary, this Section 6.04 shall not be deemed to prohibit any disposition by a Significant Subsidiary if,
after giving effect to the consummation of such transaction, such Significant Subsidiary shall have or be deemed to have a ratio of total long-term Indebtedness to total stockholders’ equity equal to or less than 1.5 to 1.0. 
 Section 6.05 Consolidated Total Debt to Consolidated Total Capitalization Ratio. The Borrower shall not permit the ratio of
Consolidated Total Debt to Consolidated Total Capitalization to be, at any time, greater than 0.70 to 1.00. 
 Section 6.06
Avista Utilities Interest-Coverage Ratio. The Borrower shall not permit the ratio of Avista Utilities EBITDA to Avista Utilities Interest Expense for any four-fiscal-quarter period to be less than 1.6 to 1. 
 Section 6.07 Public Utility Regulatory Borrowing Limits. The Borrower shall not incur actual borrowings or commitments or issued
and outstanding debt of the Borrower in excess of the amount authorized by statute or by orders of public utility commissions, as in effect from time to time. 
 Section 6.08 Investments. The Borrower shall not make any new Investments in any Subsidiary (other than a Financing Subsidiary), except for Investments in an aggregate amount (calculated, in
the case of any acquisition or Investment, based on the amount of consideration payable, and obligations incurred, by the Borrower for such acquisition or Investment) not exceeding $75,000,000 in any fiscal year of the Borrower, net of any
distributions or other amounts received by the Borrower during such fiscal year on Investments in such Subsidiaries. 
 ARTICLE
VII 
 EVENTS OF DEFAULT 
 In case of the happening (and during the continuance) of any of the following events (“Events of Default”): 
 (a) any representation or warranty made or deemed made in or in connection with any Loan Document or the Borrowings, or any representation
or warranty contained in any certificate or other document furnished in connection with or pursuant to any Loan Document, shall prove to have been false or misleading in any material respect when so made or deemed made; 
 (b) default shall be made in the payment of any principal of any Loan when and as the same shall become due and payable, whether at the
scheduled maturity date thereof or at a date fixed for prepayment thereof or by acceleration thereof or otherwise; 
 (c)
default shall be made in the payment of any interest on any Loan or any Fee or any other amount (other than an amount referred to in (b) above) due under any Loan Document, when and as the same shall become due and payable, and such default
shall continue unremedied for a period of five Business Days; 
  

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 (d) default shall be made in the due observance or performance by the Borrower of any
covenant, condition or agreement contained in Section 5.01(a), 5.05, 5.07(b) or 5.08 or in Article VI; 
 (e) default
shall be made in the due observance or performance by the Borrower of any covenant, condition or agreement (other than those specified in (b), (c) or (d) above) contained in any Loan Document, and such default shall continue unremedied for
a period of 30 days after notice thereof from the Administrative Agent or any Bank to the Borrower; 
 (f) the Borrower or any
Significant Subsidiary shall (i) fail to pay any principal or interest, regardless of amount, due in respect of any Indebtedness when the aggregate unpaid principal amount is in excess of $40,000,000, when and as the same shall become due and
payable (after expiration of any applicable grace period), or (ii) fail to observe or perform any other term, covenant, condition or agreement (after expiration of any applicable grace period) contained in any agreement or instrument evidencing
or governing any such Indebtedness if the effect of any failure referred to in this clause (ii) is to cause, or to permit the holder or holders of such Indebtedness or a trustee on its or their behalf (with or without the giving of notice, the
lapse of time or both) to cause, such Indebtedness to become due prior to its stated maturity; 
 (g) an involuntary proceeding
shall be commenced or an involuntary petition shall be filed in a court of competent jurisdiction seeking (i) relief in respect of the Borrower or any Significant Subsidiary, or of a substantial part of the property or assets of the Borrower or
a Significant Subsidiary, under Title 11 of the United States Code, as now constituted or hereafter amended, or any other Federal or state bankruptcy, insolvency, receivership or similar law, (ii) the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the Borrower or any Significant Subsidiary or for a substantial part of the property or assets of the Borrower or a Significant Subsidiary or (iii) the winding-up or liquidation of
the Borrower or any Significant Subsidiary; and such proceeding or petition shall continue undismissed, or an order or decree approving or ordering any of the foregoing shall be entered and continue unstayed and in effect, for a period of 60 or more
days; 
 (h) the Borrower or any Significant Subsidiary shall (i) voluntarily commence any proceeding or file any petition
seeking relief under Title 11 of the United States Code, as now constituted or hereafter amended, or any other Federal or state bankruptcy, insolvency, receivership or similar law, (ii) consent to the institution of, or fail to contest in a
timely and appropriate manner, any proceeding or the filing of any petition described in (g) above, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the
Borrower or any Significant Subsidiary or for a substantial part of the property or assets of the Borrower or any Significant Subsidiary, (iv) file an answer admitting the material allegations of a petition filed against it in any such
proceeding, (v) make a general assignment for the benefit of creditors, (vi) become unable, admit in writing its inability or fail generally to pay its debts as they become due or (vii) take any action for the purpose of effecting any
of the foregoing; 
  

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 (i) a final judgment or judgments shall be rendered against the Borrower, any Significant
Subsidiary or any combination thereof for the payment of money with respect to which an aggregate amount in excess of $40,000,000 is not covered by insurance, and the same shall remain undischarged for a period of 30 consecutive days during which
execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to levy upon assets or properties of the Borrower or any Significant Subsidiary to enforce any such judgment; 
 (j) a Reportable Event or Reportable Events, or a failure to make a required installment or other payment (within the meaning of
Section 430(k)(1) of the Code), shall have occurred with respect to any Plan or Plans that reasonably could be expected to result in liability of the Borrower to the PBGC or to any Plan or Plans in an aggregate amount exceeding $25,000,000, or
the value of the assets of any Plan is less than 80% of the “funding target” (as defined in Code Section 430(d)(1)) of such Plan as of the last annual valuation date applicable thereto, and within 30 days after the reporting of any
such Reportable Event to the Administrative Agent or after the receipt by the Administrative Agent of a statement required pursuant to Section 5.06, the Administrative Agent shall have notified the Borrower in writing that (i) the Required
Banks have made a determination that, on the basis of such Reportable Event or Reportable Events, such failure to make a required installment or other payment or the fact that the value of the assets of a Plan is less than 80% of the “funding
target” (as defined in Code Section 430(d)(1)) of such Plan as of the last annual valuation date applicable thereto, there are reasonable grounds (A) for the termination of any such Plan by the PBGC, (B) for the appointment by
the appropriate United States District Court of a trustee to administer any such Plan or (C) for the imposition of a Lien in favor of any such Plan, and (ii) as a result thereof an Event of Default exists hereunder; or a trustee shall be
appointed by a United States District Court to administer any such Plan; or the PBGC shall institute proceedings to terminate any such Plan; 
 (k) any Loan Document, at any time after its execution and delivery and for any reason, shall cease to be in full force and effect, or is declared by a court of competent jurisdiction to be null and void,
invalid or unenforceable in any respect; or the Borrower denies that it has any or further liability or obligation under any Loan Document, or purports to revoke, terminate or rescind any Loan Document; 
 (l) a Change in Control shall occur; 
 (m) the Lien purported to be created in any substantial portion of the property of the Borrower purported to be made subject thereto pursuant to the First Mortgage shall at any time fail to be a valid,
perfected, first-priority Lien (subject to Liens permitted to exist by the terms of the First Mortgage) securing the obligations of the Borrower under the First Mortgage (including the obligations of the First Mortgage Bond), and such failure shall
constitute or have resulted in a “Completed Default” under the First Mortgage; or 
 (n) the mortgage title insurance
policy referred to in Section 4.02(a)(ix) or any other mortgage title insurance policy purported to be issued for the benefit of the trustee under the First Mortgage, at any time after its issuance and for any reason, shall cease to be in full
force

  

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and effect, or is declared by a court of competent jurisdiction to be null and void, invalid or unenforceable in any respect; or the issuer of such policy denies that it has any or further
liability or obligation under such policy, or purports to revoke, terminate or rescind such policy; 
 then, and in every such event (other than
an event with respect to the Borrower described in paragraph (g) or (h) above), and at any time thereafter during the continuance of such event, the Administrative Agent, at the request of the Required Banks, shall, by notice to the
Borrower, take any or all of the following actions, at the same or different times: (i) terminate forthwith the Commitments, (ii) declare the Loans then outstanding to be forthwith due and payable in whole or in part, whereupon
(A) the Commitments will automatically be terminated and (B) the principal of the Loans so declared to be due and payable, together with accrued interest thereon and any unpaid accrued Fees and all other liabilities of the Borrower accrued
hereunder and under any other Loan Document, shall become forthwith due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived by the Borrower, anything contained herein or in any
other Loan Document to the contrary notwithstanding, and (iii) deliver to the Borrower notice demanding redemption of the First Mortgage Bond; and in any event with respect to the Borrower described in paragraph (g) or (h) above, the
Commitments shall automatically terminate, and the principal of the Loans then outstanding, together with accrued interest thereon and any unpaid accrued Fees and all other liabilities of the Borrower accrued hereunder and under any other Loan
Document, shall automatically become due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived by the Borrower, anything contained herein or in any other Loan Document to the
contrary notwithstanding. 
 ARTICLE VIII 
 RELEASE OF COLLATERAL 
 Section 8.01 Release upon Commitment
Reduction. In connection with any permanent reduction in the Commitments pursuant to Section 2.09(b), the Administrative Agent shall surrender to, or upon the order of, the Borrower the First Mortgage Bond then held by the Administrative
Agent against receipt by the Administrative Agent of a substitute First Mortgage Bond in an amount equal to the total Commitments after giving effect to the reduction. 
 Section 8.02 Release upon Termination and Repayment. The Administrative Agent shall surrender to, or upon the order of, the Borrower all First Mortgage Bonds then held by it pursuant hereto at
the first time at which the Commitments shall have been terminated and all amounts owing under this Agreement shall have been paid in full. 
 ARTICLE IX 
 THE ADMINISTRATIVE AGENT 
 Section 9.01 Appointment and Powers. In order to expedite the various transactions contemplated by the Loan Documents, Union
Bank is hereby appointed to act as Administrative Agent on behalf of the Banks. Each of the Banks hereby irrevocably authorizes and directs the Administrative Agent to take such action on behalf of such Bank under the terms and provisions of the
Loan Documents, and to exercise such powers thereunder as are specifically delegated to

  

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or required of the Administrative Agent by the terms and provisions thereof, together with such powers as are reasonably incidental thereto. The Administrative Agent is hereby expressly
authorized on behalf of the Banks, without hereby limiting any implied authority, (a) to receive on behalf of each of the Banks any payment of principal of or interest on the Loans outstanding hereunder and all other amounts accrued under the
Loan Documents paid to the Administrative Agent, and to distribute to each Bank its proper share of all payments so received as soon as practicable; (b) to give notice promptly on behalf of each of the Banks to the Borrower of any Event of
Default of which the Administrative Agent has actual knowledge acquired in connection with its agency hereunder; and (c) to distribute promptly to each Bank copies of all notices, agreements and other material as provided for in the Loan
Documents as received by such Administrative Agent. 
 Section 9.02 Limitation on Liability. Neither the
Administrative Agent nor any of its directors, officers, employees or agents shall be liable to any Bank as such for any action taken or omitted by any of them under the Loan Documents except for its, his or her own gross negligence or willful
misconduct, or be responsible for any statement, warranty or representation therein or the contents of any document delivered in connection therewith or be required to ascertain or to make any inquiry concerning the performance or observance by the
Borrower of any of the terms, conditions, covenants or agreements of the Loan Documents. The Administrative Agent shall not be responsible to the Banks for the due execution, genuineness, validity, enforceability or effectiveness of the Loan
Documents or any other instrument to which reference is made therein. The Administrative Agent shall in all cases be fully protected in acting, or refraining from acting, in accordance with written instructions signed by the Required Banks, and,
except as otherwise specifically provided herein, such instructions and any action taken or failure to act pursuant thereto shall be binding on all the Banks. The Administrative Agent shall, in the absence of knowledge to the contrary, be entitled
to rely on any paper or document believed by it in good faith to be genuine and correct and to have been signed or sent by the proper person or persons. Neither the Administrative Agent nor any of its directors, officers, employees or agents shall
have any responsibility to the Borrower on account of the failure or delay in performance or breach by any Bank of any of its obligations under the Loan Documents or to any Bank on account of the failure of or delay in performance or breach by any
other Bank or the Borrower of any of their respective obligations thereunder or in connection therewith. The Administrative Agent may execute any of its duties under the Loan Documents by or through agents or attorneys selected by it using
reasonable care and shall be entitled to advice of counsel concerning all matters pertaining to such duties. The Administrative Agent shall not be responsible for the negligence or misconduct of any agents or attorneys selected and authorized to act
by it with reasonable care unless the damage complained of directly results from an act or failure to act on the part of the Administrative Agent which constitutes gross negligence or willful misconduct. Delegation to an attorney for the
Administrative Agent shall not release the Administrative Agent from its obligation to perform or cause to be performed the delegated duty. The Administrative Agent shall be entitled to advice of legal counsel selected by it with respect to all
matters arising under the Loan Documents and shall not be liable for any action taken or suffered in good faith by it in accordance with the advice of such counsel. 
  

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 Section 9.03 Other Transactions with Borrower. The Administrative Agent and its
Affiliates may accept deposits from, lend money to and generally engage in any kind of business with the Borrower or any Affiliate thereof as if it were not the Administrative Agent. 
 Section 9.04 Reimbursement; Indemnification. Each Bank agrees (a) to reimburse the Administrative Agent in the amount of
such Bank’s Pro Rata Share of any expenses incurred for the benefit of the Banks by the Administrative Agent, including reasonable counsel fees and compensation of agents and employees paid for services rendered on behalf of the Banks, to the
extent not reimbursed by the Borrower and (b) to indemnify and hold harmless the Administrative Agent and any of its directors, officers, employees or agents, on demand, in the amount of its Pro Rata Share, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever which may be imposed on, incurred by or asserted against it in its capacity as the Administrative
Agent or any of them in any way relating to or arising out of the Loan Documents or any action taken or omitted by it or any of them under the Loan Documents, to the extent not reimbursed by the Borrower; provided, however, that no
Bank shall be liable to the Administrative Agent for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting from the gross negligence or willful misconduct of
the Administrative Agent or any of its directors, officers, employees or agents. 
 Section 9.05 Absence of
Reliance. Each of the Banks acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Bank and based on such documents and information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each of the Banks also acknowledges that it will, independently and without reliance upon the Administrative Agent or any Bank and based on such documents and information as it shall deem appropriate at the
time, continue to make its own decisions in taking or not taking action under or based upon the Loan Documents, any related agreement or any document furnished thereunder. 
 Section 9.06 Resignation of Administrative Agent. The Administrative Agent may at any time give notice of its resignation to the
Banks and the Borrower and shall promptly give such notice in the event that the Administrative Agent becomes a Defaulting Bank. Upon receipt of any such notice of resignation, the Required Banks may, with the consent of the Borrower (which consent
shall not be unreasonably withheld and shall not be required during an Event of Default), appoint a successor Administrative Agent. If no successor Administrative Agent shall have been so appointed by the Required Banks and shall have accepted such
appointment within 30 days after the retiring Administrative Agent’s giving of notice of resignation, then the retiring Administrative Agent may, on behalf of the Banks and after consultation with the Banks and the Borrower, appoint a successor
Administrative Agent. Upon the acceptance by any person of its appointment as a successor Administrative Agent, such person shall thereupon succeed to and become vested with all the rights, powers, privileges, duties and obligations of the retiring
Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations as Administrative Agent under the Loan Documents. After any retiring Administrative Agent’s resignation as Administrative Agent, the
provisions of this Article IX shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as the Administrative Agent. 
  

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 Section 9.07 Syndication Agent and Co-Documentation Agents.
Neither the Syndication Agent nor either Co-Documentation Agent shall have any rights, powers, obligations, liabilities, responsibilities or duties under the Loan Document other than those applicable to all Banks as such. Without limiting the
foregoing, none of the persons identified as “Syndication Agent” or “Co-Documentation Agent” shall have or be deemed to have any fiduciary relationship with any Bank. Each of the Banks acknowledges that it has not relied, and
will not rely, on any of the persons so identified in deciding to enter into this Agreement or in taking or not taking action hereunder. 
 Section 9.08 Replacement of Certain Banks. If a Bank (a) is a Defaulting Bank or (b) fails to give its consent to any amendment, waiver or action for which consent of all of the
Banks was required and to which the Required Banks consented, then, in addition to any other rights and remedies that any Person may have, the Administrative Agent may, by notice to such Bank within 120 days after such event, require such Bank to
assign all of its rights and obligations under the Loan Documents to one or more assignees specified by the Administrative Agent, in each case pursuant to an appropriate Assignment and Assumption and within 20 days after the Administrative
Agent’s notice. The Administrative Agent is irrevocably appointed as attorney-in-fact to execute any such Assignment and Assumption if such Bank fails to execute the same. Such Bank shall be entitled to receive, in cash, concurrently with such
assignment, all amounts owed to it under the Loan Documents, including all principal, interest and fees through the date of assignment (but excluding any prepayment charge other than amounts owed under Section 2.13). 
 ARTICLE X 
 MISCELLANEOUS 
 Section 10.01 Notices. Notices and other communications provided for herein shall
be in writing and shall be delivered by hand or overnight courier service, mailed or sent by telecopy, graphic scanning or other telegraphic communications equipment of the sending party, as follows: 
  

	 	(a)	if to the Borrower, to: 

 Avista Corporation 
 1411 East Mission Avenue (99202) 
 P.O. Box 3727 
 Spokane, Washington 99220 
 Attention: Senior Vice President and Chief Financial Officer 
 Telecopy: 509-495-4879 
  

	 	(b)	if to the Administrative Agent for credit matters, to: 

 Union Bank, N.A. 
 445 South Figueroa Street, 15th Floor 
 Los Angeles, California 90071 
 Attention: Power & Utilities 
 Telecopy: 213-236-4096 
  

 49 

 and if to the Administrative Agent for operational matters, to: 
 Union Bank, N.A. 
 1980 Saturn Street, Mail Code 4-957-161 
 Monterey Park, California 91754 
 Attention: Martha Arreaga, Commercial Loan & Agency Services 
 Telephone: 323-720-2578 
 Telecopy: 323-720-2780 
 E-mail: martha.arreaga@unionbank.com 
 (c) if to a Bank, to it at its address (or telecopy number) set forth in Schedule 2.01 or in the Assignment and Assumption pursuant to which
such Bank shall have become a party hereto. 
 All notices and other communications given to any party hereto in accordance with the provisions
of this Agreement shall be deemed to have been given on the date of receipt if delivered by hand or overnight courier service or sent by telecopy or other telegraphic communications equipment of the sender, or on the date five Business Days after
dispatch by certified or registered mail if mailed, in each case delivered, sent or mailed (properly addressed) to such party as provided in this Section 10.01 or in accordance with the latest unrevoked direction from such party given in
accordance with this Section 10.01. 
 Section 10.02 Survival of Agreement. All covenants, agreements,
representations and warranties, including any indemnities and reimbursement obligations, made by the Borrower in the Loan Documents and in the certificates or other instruments prepared or delivered in connection therewith or pursuant thereto shall
be considered to have been relied upon by the Banks and shall survive the making by the Banks of the Loans and the execution and delivery to the Banks of any Notes evidencing such Loans, regardless of any investigation made by the Banks, or on their
behalf, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any Fee or any other amount payable under this Agreement or any other Loan Document is outstanding and unpaid and so long as the
Commitments have not been terminated. 
 Section 10.03 Binding Effect. This Agreement shall become effective when it
shall have been executed by the Borrower and the Administrative Agent and when the Administrative Agent shall have received copies hereof which, when taken together, bear the signatures of each Bank, and thereafter shall be binding upon and inure to
the benefit of the Borrower, the Administrative Agent and each Bank and their respective successors and permitted assigns. Whenever in this Agreement any of the parties hereto is referred to, such reference shall be deemed to include the successors
and permitted assigns of such party; and all covenants, promises and agreements by or on behalf of the Borrower, the Administrative Agent or the Banks that are contained in this Agreement shall bind and inure to the benefit of their respective
successors and permitted assigns. 
  

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 Section 10.04 Successors and Assigns. 
 (a) Subject to Section 6.03, the Borrower may not assign or delegate any of its rights or duties under any of the Loan Documents without
the prior written consent of each of the Banks. 
 (b) Each Bank (including the Administrative Agent when acting as a Bank) may
assign to one or more assignees all or a portion of its interests, rights and obligations under the Loan Documents (including all or a portion of its Commitment and the same portion of the applicable Loan or Loans at the time owing to it);
provided, however, that (i) except in the case of an assignment to a Bank or Affiliate of a Bank, the Borrower and the Administrative Agent must give their prior written consent to such assignment (which consents shall not be
unreasonably withheld), provided that the consent of the Borrower shall not be required if an Event of Default shall exist, (ii) no assignee of any Bank shall be entitled to receive any greater payment or protection under
Section 2.11, 2.12(a) or 2.17 than such Bank would have been entitled to receive with respect to the rights assigned or otherwise transferred unless such assignment or transfer shall have been made at a time when the circumstances giving rise
to such greater payment did not exist, (iii) each such assignment shall be of a constant, and not a varying, percentage of all the assigning Bank’s rights and obligations under this Agreement, (iv) the amount of the Commitment of the
assigning Bank subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent) shall not be less than $5,000,000 (or, if less, the total amount of
such Bank’s Commitment), (v) the parties to each such assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption and a processing and recordation fee of $3,500 and (vi) the assignee, if it shall not
be a Bank, shall deliver to the Administrative Agent an Administrative Questionnaire. Upon acceptance and recording pursuant to paragraph (d) of this Section 10.04, from and after the effective date specified in each Assignment and
Assumption, which effective date shall be at least five Business Days after the execution thereof, (A) the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Bank under the Loan Documents and (B) the assigning Bank thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under the Loan Documents (and, in
the case of an Assignment and Assumption covering all or the remaining portion of an assigning Bank’s rights and obligations under the Loan Documents, such Bank shall cease to be a party hereto but shall continue to be entitled to the benefits
of Sections 2.11, 2.13, 2.17 and 9.05, as well as to any Fees accrued for its account and not yet paid). 
 (c) The
Administrative Agent shall maintain a copy of each Assignment and Assumption delivered to it, including the recordation of the names and addresses of the Banks, and the Commitment of, and principal amount of the Loans owing to, each Bank pursuant to
the terms hereof from time to time (the “Register”). The Administrative Agent and the Banks may treat each person whose name is recorded in the Register pursuant to the terms hereof as a Bank hereunder for all purposes of the
Loan Documents. The Register shall be available for inspection by the Borrower and any Bank at any reasonable time and from time to time upon reasonable prior notice. 
  

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 (d) Upon its receipt of a duly completed Assignment and Assumption executed by an assigning
Bank and an assignee, an Administrative Questionnaire completed in respect of the assignee (unless the assignee shall already be a Bank hereunder), the processing and recordation fee referred to in paragraph (b) above and, to the extent
required, the written consent of the Borrower and the Administrative Agent to such assignment, the Administrative Agent shall (i) accept such Assignment and Assumption, (ii) record the information contained therein in the Register and
(iii) give prompt notice thereof to the Borrower. Upon the request of the assignee, the Borrower, at its own expense, shall execute and deliver to the Administrative Agent, a new Note or Notes to the order of such assignee in a principal amount
equal to the applicable Commitment assumed by it pursuant to such Assignment and Assumption and, if the assigning Bank has retained a Commitment, upon the request of the assigning Bank, the Borrower shall execute and deliver a new Note to the order
of such assigning Bank in a principal amount equal to the applicable Commitment retained by it. Canceled Notes shall be returned to the Borrower. 
 (e) Each Bank may without the consent of the Borrower or the Administrative Agent sell participations to one or more banks or other entities in all or a portion of its rights and obligations under the
Loan Documents (including all or a portion of its Commitment and the Loans owing to it and any Notes held by it); provided, however, that (i) such Bank’s obligations under the Loan Documents shall remain unchanged,
(ii) such Bank shall remain solely responsible to the other parties hereto for the performance of such obligations, (iii) the participating banks or other entities shall be entitled to the benefit of the cost protection provisions
contained in Sections 2.11, 2.13 and 2.17 to the same extent as if they were Banks (provided, that the amount of such benefit shall be limited to the amount in respect of the interest sold to which the seller of such participation would have
been entitled had it not sold such interest) and (iv) the Borrower, the Administrative Agent and the Banks shall continue to deal solely and directly with such Bank in connection with such Bank’s rights and obligations under the Loan
Documents, and such Bank shall retain the sole right to enforce the obligations of the Borrower relating to the Loans and to approve any amendment, modification or waiver of any provision of the Loan Documents (other than amendments, modifications
or waivers (A) decreasing any Fees or the amount of principal of or the rate at which interest is payable on the Loans, (B) extending any scheduled date for the payment of Fees or principal of or interest on Loans, (C) extending the
expiration date of the Commitments or (D) releasing the First Mortgage Bond or releasing all or substantially all of the collateral therefor, in each such case except pursuant to Article VIII). 
 (f) Any Bank or participant may, in connection with any assignment or participation or proposed assignment or participation pursuant to this
Section 10.04, disclose to the assignee or participant or proposed assignee or participant any information relating to the Borrower furnished to such Bank by or on behalf of the Borrower; provided that, prior to any such disclosure of
information designated by the Borrower as confidential, each such assignee or participant or proposed assignee or participant shall execute an agreement whereby such assignee or participant shall agree (subject to customary exceptions) to preserve
the confidentiality of such confidential information. 
  

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 (g) Notwithstanding anything to the contrary contained herein, any Bank (a
“Granting Bank”) may grant to a special-purpose funding vehicle (an “SPC”) the option to fund all or any part of any Loan that such Granting Bank would otherwise be obligated to fund pursuant to this
Agreement; provided that (i) nothing herein shall constitute a commitment by any SPC to fund any Loan, and (ii) if an SPC elects not to exercise such option or otherwise fails to fund all or any part of such Loan, the Granting Bank
shall be obligated to fund such Loan pursuant to the terms hereof. The funding of a Loan by an SPC hereunder shall utilize the Commitment of the Granting Bank to the same extent as if such Loan were funded by such Granting Bank. Each party hereto
hereby agrees that no SPC shall be liable for any indemnity or payment under the Loan Documents for which a Bank would otherwise be liable for so long as, and to the extent, the Granting Bank provides such indemnity or makes such payment.
Notwithstanding anything to the contrary contained in this Agreement, any SPC may disclose on a confidential basis any non-public information relating to its funding of Loans to any rating agency, commercial paper dealer or provider of any surety or
guarantee to such SPC. This paragraph may not be amended without the prior written consent of each Granting Bank, all or any part of whose Loans are being funded by an SPC at the time of such amendment. 
 (h) Any Bank may at any time assign for security purposes all or any portion of its rights under the Loan Documents to a Federal Reserve
Bank; provided that no such assignment shall release a Bank from any of its obligations thereunder. 
 Section 10.05
Expenses; Indemnity, Damage Waiver. 
 (a) The Borrower agrees to pay all reasonable out-of-pocket expenses (including the
reasonable fees, charges and disbursements of internal or external legal counsel) (i) incurred by the Administrative Agent in connection with the preparation of the Loan Documents or in connection with any amendments, modifications or waivers
of the provisions thereof (whether or not the transactions thereby contemplated shall be consummated) or (ii) incurred by the Administrative Agent or any Bank in connection with the enforcement or protection of its rights in connection with the
Loan Documents or any Loan. 
 (b) The Borrower agrees that it shall indemnify the Administrative Agent and the Banks against
and hold them harmless from any documentary taxes, assessments or charges made by any Governmental Authority by reason of the execution and delivery of this Agreement or any of the other Loan Documents. 
 (c) The Borrower agrees to indemnify the Administrative Agent and each Bank and each of their respective directors, officers, employees and
agents (each such person being called an “Indemnitee”) against, and to hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses, including reasonable counsel fees, charges and
disbursements, incurred by or asserted against any Indemnitee arising out of, in any way connected with, or as a result of, (i) the execution or delivery of this Agreement or any other Loan Document or any agreement or instrument contemplated
thereby, the performance by the

  

 53 

 
parties thereto of their respective obligations thereunder or the consummation of the Transactions and the other transactions contemplated thereby, (ii) the use of the proceeds of the Loans
or (iii) any claim, litigation, investigation or proceeding relating to any of the foregoing, whether or not any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that
such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee. 
 (d) To the fullest extent permitted by applicable law, the Borrower shall not assert, and hereby waives, any claim against any Indemnitee,
on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or
instrument contemplated hereby, the transactions contemplated hereby or thereby, any Loan or the use of the proceeds thereof; provided that such waiver shall not, as to any Indemnitee, apply to special, indirect or consequential damages to
the extent resulting from, or punitive damages awarded on account of, conduct by such Indemnitee that is determined by a court of competent jurisdiction by final and nonappealable judgment to have constituted gross negligence or willful misconduct
by such Indemnitee. 
 (e) The provisions of this Section 10.05 shall remain operative and in full force and effect
regardless of the expiration of the term of this Agreement, the consummation of the transactions contemplated hereby, the repayment of any of the Loans, the invalidity or unenforceability of any term or provision of this Agreement or any other Loan
Document, or any investigation made by or on behalf of the Administrative Agent or any Bank. All amounts due under this Section 10.05 shall be payable on written demand therefor. 
 Section 10.06 Right of Setoff. If an Event of Default shall have occurred and be continuing and the Loans shall have been
accelerated as set forth in Article VII, each of the Banks is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other indebtedness at any time owing by such Bank (or person Controlling such Bank) to or for the credit or the account of the Borrower against any of and all the obligations of the Borrower now or
hereafter existing under this Agreement and other Loan Documents held by such Bank, irrespective of whether or not such Bank shall have made any demand under this Agreement or any other Loan Document and although such obligations of the Borrower are
owed to a branch or office of such Bank different from the branch or office holding such deposit or obligated on such indebtedness. The rights of each Bank under this Section are in addition to other rights and remedies (including other rights
of setoff) which such Bank may have. Any Bank shall promptly notify the Borrower after exercising its rights under this Section. 
 Section 10.07 Applicable Law. THIS AGREEMENT, AND THE OTHER LOAN DOCUMENTS OTHER THAN THE FIRST MORTGAGE BOND, THE FIRST MORTGAGE AND THE SUPPLEMENTAL INDENTURE, SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF
THE STATE OF NEW YORK. 
  

 54 

 Section 10.08 Waivers; Amendment. 
 (a) No failure or delay of the Administrative Agent or any Bank in exercising any power or right under the Loan Documents shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or
power. The rights and remedies of the Administrative Agent and the Banks hereunder and under the other Loan Documents are cumulative and are not exclusive of any rights or remedies which they would otherwise have. No waiver of any provision of this
Agreement or any other Loan Document or consent to any departure by the Borrower therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) below, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. No notice or demand on the Borrower in any case shall entitle the Borrower to any other or further notice or demand in similar or other circumstances. 
 (b) Neither the Loan Documents nor any provision thereof may be waived, amended or modified except pursuant to an agreement or agreements in
writing entered into by the Borrower and the Required Banks; provided, however, that no such agreement shall (i) without the consent of the applicable Bank, (A) decrease the principal of or the rate of interest on such
Bank’s Loans or the Fees payable to such Bank, (B) extend the date for any scheduled payment of principal of or interest on such Bank’s Loans or the Fees payable to such Bank, or (C) increase the amount or extend the expiration
date of such Bank’s Commitment, or (ii) without the consent of each Bank, (A) release the First Mortgage Bond or release all or substantially all of the collateral therefor, in each such case except pursuant to Article VIII, or
(B) amend or modify the provisions of Section 2.14, the provisions of this Section, the definition of “Required Banks” or any other provision requiring the consent or agreement of each of the Banks; provided further
that no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent under the Loan Documents without the prior written consent of the Administrative Agent. Each Bank and each holder of a Note shall be
bound by any waiver, amendment or modification authorized by this Section regardless of whether its Note shall have been marked to make reference thereto, and any consent by any Bank or holder of a Note pursuant to this Section shall bind
any person subsequently acquiring a Note from it, whether or not such Note shall have been so marked. 
 Section 10.09
Interest Rate Limitation. Notwithstanding anything herein or in any Notes to the contrary, if at any time the applicable interest rate, together with all fees and charges which are treated as interest under applicable law (collectively the
“Charges”), as provided for herein or in any other document executed in connection herewith, or otherwise contracted for, charged, received, taken or reserved by any Bank, shall exceed the maximum lawful rate (the
“Maximum Rate”) which may be contracted for, charged, taken, received or reserved by such Bank in accordance with applicable law, the rate of interest payable under any Note held by such Bank, together with all Charges
payable to such Bank, shall be limited to the Maximum Rate. 
 Section 10.10 Entire Agreement. Each Loan Document
constitutes the entire contract between or among the parties relative to the subject matter thereof, and any previous agreement between or among the parties with respect to the subject matter thereof is superseded by such

  

 55 

 
Loan Document. Nothing in this Agreement or in the other Loan Documents, expressed or implied, is intended to confer upon any party other than the parties hereto and thereto any rights, remedies,
obligations or liabilities under or by reason of this Agreement or the other Loan Documents. 
 Section 10.11 Waiver of
Jury Trial. Each party hereto hereby waives, to the fullest extent permitted by applicable law, any right it may have to a trial by jury in respect of any litigation directly or indirectly arising out of, under or in connection with this
Agreement or any of the other Loan Documents. Each party hereto (a) certifies that no representative, agent or attorney of any other party has represented, expressly or otherwise, that such other party would not, in the event of litigation,
seek to enforce the foregoing waiver and (b) acknowledges that it and the other parties hereto have been induced to enter into this Agreement and the other Loan Documents, as applicable, by, among other things, the mutual waivers and
certifications in this Section 10.11. 
 Section 10.12 Severability. In the event any one or more of the
provisions contained in this Agreement or in any other Loan Document should be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein and therein shall not in any
way be affected or impaired thereby. The parties shall endeavor in good-faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the
invalid, illegal or unenforceable provisions. 
 Section 10.13 Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall constitute an original but all of which when taken together shall constitute but one contract, and shall become effective as provided in Section 10.03. 
 Section 10.14 Headings. Article and Section headings and the Table of Contents used herein are for convenience of
reference only, are not part of this Agreement and are not to affect the construction of, or to be taken into consideration in interpreting, this Agreement. 
 Section 10.15 Jurisdiction; Consent to Service of Process. 
 (a) The
Borrower hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of any New York State court or Federal court of the United States of America sitting in New York City, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to this Agreement or the other Loan Documents, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees
that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that the Administrative Agent or any Bank may otherwise have
to bring any action or proceeding relating to this Agreement or the other Loan Documents against the Borrower or its properties in the courts of any jurisdiction. 
  

 56 

 (b) The Borrower hereby irrevocably and unconditionally waives, to the fullest extent it may
legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or the other Loan Documents in any New York State or Federal court.
Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court. 
 (c) Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 10.01.
Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law. 
 Section 10.16 USA Patriot Act Notification. Each Bank hereby notifies the Borrower that, pursuant to the requirements of the USA Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001) (the
“Act”), it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Bank to identify the
Borrower in accordance with the Act. The Borrower agrees to cooperate with each Bank and provide true, accurate and complete information to such Bank in response to any such request. 
 [Signature pages follow.] 
  

 57 

 WITNESS the due execution hereof as of the date first above written. 
  

			
	AVISTA CORPORATION
		
	By:	 	 /s/ Jason Thackston

	Name:	 	 Jason Thackston

	Title:	 	 Vice President

 Avista Corporation Short-Term Revolving Credit Agreement – Signature Pages 

			
	 UNION BANK, N.A.,
 as Administrative Agent and a Bank

		
	By:	 	 /s/ Pascal Uttinger

	Name:	 	 Pascal Uttinger

	Title:	 	 Vice President

 Avista Corporation Short-Term Revolving Credit Agreement – Signature Pages 

			
	WELLS FARGO BANK, NATIONAL ASSOCIATION
		
	By:	 	 /s/ Tom Beil

	Name:	 	 Tom Beil

	Title:	 	 Vice President

 Avista Corporation Short-Term Revolving Credit Agreement – Signature Pages 

			
	JPMORGAN CHASE BANK, N.A.
		
	By:	 	 /s/ Jennifer Fitzgerald

	Name:	 	 Jennifer Fitzgerald

	Title:	 	 Associate

 Avista Corporation Short-Term Revolving Credit Agreement – Signature Pages 

			
	UBS LOAN FINANCE LLC
		
	By:	 	 /s/ Irja R. Otsa

	Name:	 	 Irja R. Otsa

	Title:	 	 Associate Director

		
	By:	 	 /s/ Marie Haddad

	Name:	 	 Marie Haddad

	Title:	 	 Associate Director

 Avista Corporation Short-Term Revolving Credit Agreement – Signature Pages 

			
	KEYBANK NATIONAL ASSOCIATION
		
	By:	 	 /s/ Keven D. Smith

	Name:	 	 Keven D. Smith

	Title:	 	 Senior Vice President

 Avista Corporation Short-Term Revolving Credit Agreement – Signature Pages 

			
	U.S. BANK NATIONAL ASSOCIATION
		
	By:	 	 /s/ Raymond J. Palmer

	Name:	 	 Raymond J. Palmer

	Title:	 	 Utilities, S.V.P.

 Avista Corporation Short-Term Revolving Credit Agreement – Signature Pages 

 EXHIBIT A 
 [FORM OF] 
 NOTE 
  

			
	$            	  	            , 2009

 FOR VALUE RECEIVED, the undersigned, AVISTA CORPORATION, a Washington corporation
(the “Borrower”), hereby promises to pay to the order of
                                 (the “Bank”), at the
office of Union Bank, N.A., as administrative agent (the “Administrative Agent”), at 445 South Figueroa Street, Los Angeles, California, on the Expiration Date, as defined in the Credit Agreement dated as of November 25,
2009 among the Borrower, the Banks listed in Schedule 2.01 thereto, JPMorgan Chase Bank, N.A. and UBS Securities LLC, as Co-Documentation Agents, Wells Fargo Securities, LLC, as Syndication Agent, and the Administrative Agent (the “Credit
Agreement”), the aggregate unpaid principal amount of all Loans (as defined in the Credit Agreement) of the Bank under the Credit Agreement, in lawful money of the United States of America in immediately available funds, and to pay
interest from the date hereof on the principal amount hereof from time to time outstanding, in like funds, at said office, at the rate or rates per annum and payable on the dates provided in the Credit Agreement. 
 The Borrower promises to pay interest, on demand, on any overdue principal and, to the extent permitted by law, overdue interest from their
due dates at the rate or rates provided in the Credit Agreement. 
 The Borrower hereby waives diligence, presentment, demand,
protest and notice of any kind whatsoever. The nonexercise by the holder of any of its rights hereunder in any particular instance shall not constitute a waiver thereof in that or any subsequent instance. 
 All Loans evidenced by this Note and all payments and prepayments of the principal hereof and interest hereon and the respective dates and
maturity dates thereof shall be endorsed by the holder hereof on the schedule attached hereto and made a part hereof or on a continuation thereof which shall be attached hereto and made a part hereof, or otherwise recorded by such holder in its
internal records; provided, however, that the failure of the holder hereof to make such a notation or any error in such a notation shall not affect the obligations of the Borrower under this Note. 
 This Note is one of the Notes referred to in the Credit Agreement, which, among other things, contains provisions for the acceleration of
the maturity hereof upon the happening of certain events, for optional and mandatory prepayment of the principal hereof prior to the maturity hereof and for the amendment or waiver of certain provisions of the Credit Agreement,

 
all upon the terms and conditions therein specified. This Note shall be construed in accordance with and governed by the laws of the State of New York and any applicable laws of the United States
of America. 
  

			
	AVISTA CORPORATION
		
	By:	 	  

	Name:	 	  

	Title:	 	  

  

 2 

 Loans and Payments 
  

											
	 Date
	 	 Amount
 and
 Type of
Loan
	 	 Maturity
 Date
	 	 Payments of
 Principal Interest
	 	 Unpaid Principal
Balance of Note
	 	 Name of Person Making
Notation

		 		 		 		 		 	
		 		 		 		 		 	
		 		 		 		 		 	
		 		 		 		 		 	

  

 3 

 EXHIBIT B 
 [FORM OF] 
 ASSIGNMENT AND ASSUMPTION 
 This Assignment and Assumption (the “Assignment and Assumption”) is dated as of the Effective Date set forth below
and is entered into by and between [Insert name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the “Assignee”). Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (as amended, the “Credit Agreement”). The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by
reference and made a part of this Assignment and Assumption as if set forth herein in full. 
 For an agreed consideration, the
Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the
Effective Date inserted by the Administrative Agent as contemplated below (i) all of the Assignor’s rights and obligations in its capacity as a Bank under the Credit Agreement and any other documents or instruments delivered pursuant
thereto to the extent related to the assigned amount and percentage interest identified below of the respective facilities identified below and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of
action and any other rights of the Assignor (in its capacity as a Bank) against any person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan
transactions governed thereby or in any way based on or related to any of the foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity, in each case related
to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned pursuant to clauses (i) and (ii) above being referred to herein collectively as, the “Assigned
Interest”). Such sale and assignment are without recourse to the Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by the Assignor. 
  

							
	1.        	  	Assignor:	  	  
	  	
				
	2.	  	Assignee:	  	  
	  	
		  		  	[an Affiliate of [identify existing Bank]]1	  	
				
	3.	  	Borrower:	  	Avista Corporation	  	
				
	4.	  	Administrative Agent:	  	Union Bank, N.A.	  	
			
	5.	  	Credit Agreement:	  	Credit Agreement, dated as of November 25, 2009, among Avista Corporation, the Banks listed in Schedule 2.01 thereto, JPMorgan Chase Bank, N.A. and UBS Securities LLC,
as Co-Documentation Agents, Wells Fargo Securities, LLC, as Syndication Agent, and Union Bank, N.A., as Administrative Agent

  

	1	 Include if applicable. 

	6.	Assigned Interest: 

  

							
	 Facility Assigned2
	  	 Aggregate Amount of
 [Commitments /
 Revolving Credit
 Exposures]3 for
all
 Banks4
	  	 Amount of
 [Commitment /
 Revolving Credit
 Exposure]3
Assigned4
	  	 Percentage5 Assigned
 of [Commitments /
 Revolving Credit
 Exposures]3 for all
 Banks

		  	$	  	$	  	%
		  	$	  	$	  	%
		  	$	  	$	  	%

  

	[7.	 Trade Date:             , 20    ]6 

 Effective Date:             , 20     [TO BE INSERTED BY
ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.] 
 The terms
set forth in this Assignment and Assumption are hereby agreed to: 
  

			
	ASSIGNOR
	
	[NAME OF ASSIGNOR]
		
	By:	 	  

	Name:	 	  

	Title:	 	  

	
	ASSIGNEE
	
	[NAME OF ASSIGNEE]
		
	By:	 	  

	Name:	 	  

	Title:	 	  

  
  

	2	 Fill in the appropriate terminology for the types of facilities under the Credit Agreement that are being assigned under this Assignment (e.g.,
“Revolving Credit Commitment”) 

	3	 Use “Revolving Credit Exposure[s]” if Commitments have been terminated; otherwise, use “Commitment[s].”

	4	 Amount to be adjusted by the counterparties to take into account any payments or prepayments made between the Trade Date and the Effective Date.

	5	 Set forth, to at least 9 decimals, as a percentage of the Commitments / Revolving Credit Exposures of all Banks thereunder.

	6	 To be completed if the Assignor and the Assignee intend that the minimum assignment amount is to be determined as of the Trade Date.

  

 2 

 [Consented to and]7 Accepted: 
  

					
	UNION BANK, N.A.,	 	
	as Administrative Agent	 	
			
	By:	 	  
	 	
	Name:	 	  
	 	
	Title:	 	  
	 	
		
	[Consented to:	 	
		
	AVISTA CORPORATION	 	
			
	By:	 	  
	 	
	Name:	 	  
	 	
	Title:	 	  
	 	]6

  
  

	7	 To be included if such consent is required by the terms of the Credit Agreement. 

  

 3 

 ANNEX 1 
 STANDARD TERMS AND CONDITIONS FOR 
 ASSIGNMENT AND ASSUMPTION 
 1. Representations and Warranties. 
 1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any
lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby; and
(b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of the Borrower, any of its Subsidiaries or Affiliates or any other person obligated in respect of any Loan Document or
(iv) the performance or observance by the Borrower, any of its Subsidiaries or Affiliates or any other person of any of their respective obligations under any Loan Document. 
 1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Bank under the Credit Agreement, (ii) from and after the Effective Date, it shall be bound by the provisions
of the Credit Agreement as a Bank thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Bank thereunder, (iii) it has received a copy of the Credit Agreement, together with copies of the most recent financial
statements delivered pursuant to Section 5.04 thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to
purchase the Assigned Interest, on the basis of which it has made such analysis and decision independently and without reliance on the Administrative Agent or any other Bank, and (iv) if it is a Non-U.S. Person (as defined in
Section 2.17(g) of the Credit Agreement), attached to the Assignment and Assumption is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by the Assignee; (b) agrees
that (i) it will, independently and without reliance on the Administrative Agent, the Assignor or any other Bank, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Bank; and (c) effective
on the Effective Date, appoints and authorizes the Administrative Agent to take such action as Administrative Agent on its behalf and to exercise such powers under the Loan Documents as are delegated to the Administrative Agent by the terms thereof,
together with such powers as are reasonably incidental thereto. 

 2. Payments. From and after the Effective Date, the Administrative Agent shall make
all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for amounts which have
accrued from and after the Effective Date. 
 3. General Provisions. This Assignment and Assumption shall be binding
upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment and Assumption may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed
counterpart of a signature page of this Assignment and Assumption by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption. This Assignment and Assumption shall be governed by, and construed in
accordance with, the law of the State of New York. 
  

 2 

 EXHIBIT C 
 [FORM OF] 
 ADMINISTRATIVE QUESTIONNAIRE 
 ACCOUNT: Avista Corporation 
 FACILITY: Short-Term
Revolving Credit Facility 
 LEGAL NAME OF BANK: 
  
  
  
 Operations Contact 
 (Repayments/Funding Matters)

  

			
	Name	  	 
		
	Title	  	 
		
	Street Address	  	 
		
	City, State and Zip        	  	 
		
	Telephone	  	 
		
	Fax	  	 
		
	E-Mail Address	  	 

 Credit Contact 
 (Compliance Matters and Financial Statements) 
  

			
	Name	  	 
		
	Title	  	 
		
	Street Address	  	 
		
	City, State and Zip        	  	 
		
	Telephone	  	 
		
	Fax	  	 
		
	E-Mail Address	  	 

 Wire Instructions: 
  

			
	 	 	
		
	 	 	
		
	 	 	

 EXHIBIT D 
 [FORM OF] 
 COMMITMENT INCREASE SUPPLEMENT 
 THIS COMMITMENT INCREASE SUPPLEMENT is made and dated as of             ,
20    , by and among [ADDITIONAL COMMITMENT BANK] (the “Additional Commitment Bank”), AVISTA CORPORATION, a Washington corporation (the “Borrower”), and UNION BANK, N.A., as
Administrative Agent under the Credit Agreement, dated as of November 25, 2009, among the Borrower, the Banks listed in Schedule 2.01 thereto, JPMorgan Chase Bank, N.A. and UBS Securities LLC, as Co-Documentation Agents, Wells Fargo Securities,
LLC, as Syndication Agent, and Union Bank, N.A., as Administrative Agent (as amended, modified or supplemented from time to time, the “Credit Agreement”). Terms used and not otherwise defined herein are used herein with the
meanings ascribed thereto in the Credit Agreement. 
 WHEREAS, pursuant to Section 2.09(c) of the Credit Agreement, the
Borrower desires to have the aggregate amount of the Commitments increased; and 
 WHEREAS, the Additional
Commitment Bank is willing to [become an additional Bank]1
[increase its Commitment]2; 
 NOW, THEREFORE, the parties hereto agree as follows: 
 1. Upon the effectiveness of this Commitment Increase Supplement, [the Additional Commitment Bank shall be a party to
the Credit Agreement and shall be entitled to all of the rights, and be subject to all of the obligations, of a Bank under the Credit Agreement]1 [the Commitment of the Additional Commitment Bank shall be increased from
$             to $            .]2 [The initial amount of the Additional Commitment Bank’s Commitment shall be
$            .]1 
 2. The Additional Commitment Bank acknowledges, and agrees to comply with, its
obligation under Section 2.09(c) of the Credit Agreement to purchase assignments of Loans from the other Banks on the effective date hereof. 
 3. This Commitment Increase Supplement shall become effective upon the execution and delivery hereof by the Additional Commitment Bank, the Borrower and the Administrative Agent. 
  
  

	1	 Include if Additional Commitment Bank is not an existing Bank. 

	2	 Include if Additional Commitment Bank is an existing Bank. 

 4. This Commitment Increase Supplement may be executed in any number of counterparts and by
the different parties hereto on separate counterparts, each of which when so executed and delivered shall be an original, but all of which shall together constitute one and the same instrument. 
 5. This Commitment Increase Supplement shall be construed in accordance with and governed by the law of the State of New York. 

IN WITNESS WHEREOF, the parties hereto have caused this Commitment Increase Supplement to be executed as of the day and year first
written above. 
  

			
	[ADDITIONAL COMMITMENT BANK]
		
	By:	 	  

	Name:	 	  

	Title:	 	  

	
	AVISTA CORPORATION
		
	By:	 	  

	Name:	 	  

	Title:	 	  

	
	 UNION BANK, N.A.,
 as Administrative Agent

		
	By:	 	  

	Name:	 	  

	Title:	 	  

  

 2 

 EXHIBIT E 
 [FORM OF] 
 COMMITMENT EXTENSION SUPPLEMENT 
 THIS COMMITMENT EXTENSION SUPPLEMENT is made and dated as of
            , 20     by and among
                                 (the “Additional Commitment
Bank”), AVISTA CORPORATION, a Washington corporation (the “Borrower”), and UNION BANK, N.A., as Administrative Agent under the Credit Agreement, dated as of November 25, 2009, among the Borrower, the Banks
listed in Schedule 2.01 thereto, JPMorgan Chase Bank, N.A. and UBS Securities LLC, as Co-Documentation Agents, Wells Fargo Securities, LLC, as Syndication Agent, and Union Bank, N.A., as Administrative Agent (as amended, modified or supplemented
from time to time, the “Credit Agreement”). Terms used and not otherwise defined herein are used herein with the meanings ascribed thereto in the Credit Agreement. 
 WHEREAS, pursuant to Section 2.19(e) of the Credit Agreement, the Borrower desires to have an aggregate amount of Commitments up to the
aggregate amount of the Existing Commitments extended; and 
 WHEREAS, the Additional Commitment Bank is
willing to [become an additional Bank]10 [increase its
Commitment]11; 
 NOW, THEREFORE, the parties hereto agree as follows: 
 1. Upon the effectiveness of this Commitment Extension Supplement, [the Additional Commitment Bank shall be a party to
the Credit Agreement and shall be entitled to all of the rights, and be subject to all of the obligations, of a Bank under the Credit Agreement]1 [the Commitment of the Additional Commitment Bank shall be increased from
$             to $            .]2 [The initial amount of the Additional Commitment Bank’s Commitment shall be
$            .]1 
 2. This Commitment Extension Supplement shall become effective upon the
execution and delivery hereof by the Additional Commitment Bank, the Borrower and the Administrative Agent. 
 3. This
Commitment Extension Supplement may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which when so executed and delivered shall be an original, but all of which shall together constitute
one and the same instrument. 
  
  

	1	 Include if Additional Commitment Bank is not an existing Bank. 

	2	 Include if Additional Commitment Bank is an existing Bank. 

 4. This Commitment Extension Supplement shall be construed in accordance with and governed
by the law of the State of New York. 
 IN WITNESS WHEREOF, the parties hereto have caused this Commitment Extension Supplement
to be executed as of the day and year first written above. 
  

			
	[ADDITIONAL COMMITMENT BANK]
		
	By:	 	  

	Name:	 	  

	Title:	 	  

	
	AVISTA CORPORATION
		
	By:	 	  

	Name:	 	  

	Title:	 	  

	
	 UNION BANK, N.A.,
 as Administrative Agent

		
	By:	 	  

	Name:	 	  

	Title:	 	  

  

 2 

 SCHEDULE 2.01 
 Names, Commitments and Addresses for Initial Banks 
  

				
	 Bank
	  	Commitment
	 Union Bank, N.A.
 445 South Figueroa Street
 Los Angeles, CA 90071
 Attention: Power & Utilities
 Telecopy: (213) 236-4096
	  	$	15,000,000
		
	 Wells Fargo Bank, National Association
 601 West 1st Avenue, Suite 900
 Spokane, WA 99201
 Attention: Tom Beil / Jessy Hummel
 Telecopy: (866) 917-7929
	  	$	15,000,000
		
	 JPMorgan Chase Bank, N.A.
 10 South Dearborn Street, Floor 9
 Chicago, IL 60603
 Attention: Jennifer Fitzgerald / Nancy Barwig
 Telecopy: (312) 732-1762
	  	$	12,500,000
		
	 UBS Loan Finance LLC
 677 Washington Boulevard
 Stamford, CT 06901
 Attention: Denise Bushee
 Telecopy: (203) 719-3888
	  	$	12,500,000
		
	 KeyBank National Association
 601 108th Avenue
 Bellevue, WA 98004
 Attention: Keven D. Smith
 Telecopy: (425) 709-4565
	  	$	10,000,000
		
	 U.S. Bank National Association
 1420 Fifth Avenue, 10th Floor
 Seattle, WA 98101
 Attention: Kurban Merchant
 Telecopy: (206) 344-3654
	  	$	10,000,000
		  	 	 
	 TOTAL:
	  	$	75,000,000
		  	 	 

 SCHEDULE 3.13 
 Significant Subsidiaries 
 None. 

 SCHEDULE 4.02(a)(ii) 
 Required Governmental Approvals 
 Washington 
 Order Establishing Compliance with Section 80.08.040 of the Revised Code of Washington, entered October 17, 2008, in Docket No. UE-081842 of the
Washington Utilities and Transportation Commission (“WUTC”), Order Establishing Compliance with Section 80.08.040 of the Revised Code of Washington, entered November 7, 2008, in Docket No. UE-081842 of the WUTC and
Order Establishing Compliance with Section 80.08.040 of the Revised Code of Washington, entered November 13, 2009, in Docket No. UE-081842 of the WUTC. 
 Oregon 
 Order No. 09-442, entered November 4, 2009, in file number UF 4260 from
the Public Utility Commission of Oregon and Order No. 09-464, entered November 24, 2009, in file number UF 4260(1) from the Public Utility Commission of Oregon. 
 Idaho 
 Order No. 30673, entered November 6, 2008, in Case No. AVU-U-08-02 of the
Idaho Public Utilities Commission and electronic message from Terri Carlock of the Idaho Public Utilities Commission to Damien Lysiak of the Borrower dated September 30, 2009. 
 Montana 
 Default Order No. 4535, entered July 2, 1979, in Docket No. 6690 of
the Public Service Commission of the State of Montana. 

 SCHEDULE 6.01 
 Existing Secured Indebtedness 
 First Mortgage Bonds Outstanding under
Mortgage and Deed of Trust Dated as of June 1, 1939, 
 as Modified by Supplemental Indentures Thereto 
  

														
	SUPPLEMENTAL	  	 	  	 SERIES
	  	 PRINCIPAL
 AMOUNT
	  	 PRINCIPAL
 AMOUNT
	 
	 INDENTURE
	  	 DATED AS OF
	  	 NO.
	  	 DESIGNATION
	  	ISSUED	  	OUTSTANDING	 
	 Twenty-Sixth
	  	April 1, 1993	  	24	  	 Secured Medium-Term Notes, Series A
 ($250,000,000 authorized)
	  	$	250,000,000	  	$	48,000,000	  
	 Twenty-Seventh
	  	January 1, 1994	  	25	  	 Secured Medium-Term Notes, Series B
 ($250,000,000 authorized)
	  	$	161,000,000	  	$	5,000,000	  
	 Thirty-second
	  	September 1, 2003	  	30	  	6.125% Series due 2013	  	$	45,000,000	  	$	45,000,000	  
	 Thirty-fourth
	  	November 1, 2004	  	32	  	5.45% Series due 2019	  	$	90,000,000	  	$	90,000,000	  
	 Thirty-fifth
	  	December 1, 2004	  	33	  	Collateral Series 2004A	  	$	88,850,000	  	$	50,000,000	  
	 Thirty-eighth
	  	May 1, 2005	  	37	  	Collateral Series 2005B	  	$	66,700,000	  	$	66,700,000	  
	 Thirty-ninth
	  	November 1, 2005	  	39	  	6.25% Series due 2035	  	$  
 $
	100,000,000  
 50,000,000
	  	$  
 $
	100,000,000  
 50,000,000
	    
   

	 Fortieth
	  	April 1, 2006	  	40	  	Collateral Series due 2011	  	$	320,000,000	  	$	320,000,000	  
	 Forty-first
	  	December 1, 2006	  	41	  	5.70% Series due 2037	  	$	150,000,000	  	$	150,000,000	  
	 Forty-second
	  	April 1, 2008	  	42	  	5.95% Series due 2018	  	$	250,000,000	  	$	250,000,000	  
	 Forty-third
	  	November 1, 2008	  	43	  	Collateral Series 2008A	  	$	200,000,000	  	$	200,000,000	1 
	 Forty-fourth
	  	December 1, 2008	  	44	  	7.25% Series due 2013	  	$	30,000,000	  	$	30,000,000	  
	 Forty-fifth
	  	December 1, 2008	  	45	  	Collateral Series 2008B	  	$	17,000,000	  	$	17,000,000	  
	 Forty-sixth
	  	September 1, 2009	  	46	  	5.125% Series due 2022	  	$	250,000,000	  	$	250,000,000	  

 Aggregate principal amount of First Mortgage Bonds outstanding through and including the Forty-sixth
Supplemental Indenture (but excluding the Forty-seventh Supplemental Indenture) = $1,671,700,000. 
  
  

	1	 To be retired in connection with the delivery of $75,000,000 of First Mortgage Bonds, Collateral Series 2009A, pursuant to the Forty-seventh
Supplemental Indenture.Amended and restated form of CEO Change in Control Severance Agreement - CEO

 Exhibit 10.64 
 AMENDED AND RESTATED 
 CEO CHANGE IN CONTROL
SEVERANCE AGREEMENT 
 This AMENDED AND RESTATED CEO CHANGE IN CONTROL SEVERANCE AGREEMENT (“Agreement”),
is dated as of August 20, 2009 (the “Effective Date”) and made by and between Blue Coat Systems, Inc., a Delaware corporation (the “Company”), and
                     (“Employee”), and amends and restates the Executive Change in Control Severance Agreement earlier
entered into between the Company and Employee, as of May 1, 2009 (the “Initial Agreement”), in its entirety. 
 WHEREAS, the parties desire to amend Section 2.01(a)(i) of the Initial Agreement to provide that the Change in Control Severance Benefits will include 150% of the Employee’s annual target incentive compensation under the
Employee’s then existing incentive compensation plan. 
 NOW THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements of the parties set forth in this Agreement, and of other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, agree as follows:

 ARTICLE 1 
 TERM AND NATURE OF AGREEMENT 
 Section 1.01. Term. This Agreement shall be in force until the second anniversary of the Effective Date, and thereafter renew for automatic one-year terms, unless the Company shall give the Employee written notice of termination
at least 30 days before the expiration of the then current term, provided that no Change in Control has occurred prior to such date. Notwithstanding the foregoing, this Agreement shall terminate (i) 12 months after a Change in Control (subject
to satisfaction of any obligations hereunder as a result of a termination of employment prior to such expiration) and (ii) upon on any termination of employment prior to a Change in Control. 
 Section 1.02. At-Will Employment. Nothing in this Agreement shall change the at-will nature of Employee’s employment with
the Company. 
 ARTICLE 2 
 CHANGE IN CONTROL TERMINATION 
 Section 2.01. Severance Benefits.  
 (a) If upon, or within 18 months following, or within two months
preceding a Change in Control, Employee is terminated by the Company without Cause or Employee resigns for Good Reason, Employee shall be entitled to the following (“Change in Control Severance Benefits”), provided that Employee
executes and lets become

 
effective a release of claims, in the form attached hereto as Exhibit A (the “Release”), within 45 days following the termination of employment: 
 (i) a lump sum cash payment equal to the sum of (x) 150% of Employee’s then-existing annual
base salary and (y) the Employee’s annual target incentive compensation under the Employee’s then existing incentive compensation plan (e.g., as of May 1, 2009, the Company’s profit sharing plan), which shall be paid as soon
as administratively practicable after the date on which the Release becomes effective, and, in any event, no later than two and one-half (2 1/2) months after the end of the taxable year of the Employee in which the termination of employment occurs; 
 (ii) payment or reimbursement of health benefit continuation coverage under COBRA or otherwise from the termination date
through the earlier of (A) 18 months following the termination date or (B) the date Employee becomes eligible for health benefits with another employer, which shall be paid no later than the month of such coverage; and 
 (iii) all of the Employee’s unvested and outstanding Equity Awards shall become vested in accordance with the terms of
the applicable equity plans and award agreements. 
 (b) Definitions. For purposes of this Agreement, the following definitions
shall have the following meanings: 
 (i) “Cause” shall exist if: (A) Employee is convicted
of, or pleads guilty or no contest to, a criminal offense; (B) Employee engages in any act of fraud or dishonesty; (C) Employee breaches any agreement with the Company; (D) Employee commits any material violation of Company policy; or
(E) Employee fails, refuses or neglects to perform the services required of Employee in his position at the Company. 
 (ii) “Change in Control” means the occurrence of any one or more of the following: 
 (A) the consummation of a merger or consolidation of the Company with or into any other entity (other than with any entity or group in which Executive has not less than a 5% beneficial interest) pursuant
to which the holders of outstanding equity of the Company immediately prior to such merger or consolidation hold directly or indirectly 50% or less of the voting power of the equity securities of the surviving entity; 
 (B) the sale or other disposition of all or substantially all of the Company’s assets (other than to any entity or group
in which Executive has not less than a 5% beneficial interest); 

 (C) any acquisition by any person or persons (other than any entity or group
in which Executive has not less than a 5% beneficial interest) of the beneficial ownership of more than 50% of the voting power of the Company’s equity securities in a single transaction or series of related transactions; provided,
however, that an underwritten public offering of the Company’s securities shall not be considered a Change in Control; or 
 (D) if during any period of 12 consecutive months, individuals who at the beginning of any such period constitute the Board cease for any reason to constitute at least a majority thereof, unless the
election, or the nomination for election by the Company’s stockholders, of each director of the Company first elected during such period was approved or recommended by at least a majority of the directors then still in office who were directors
of the Company at the beginning of any such period and any such newly approved directors; 
 provided, however,
that a transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who
directly or indirectly held the Company’s securities immediately before such transaction. 
 (iii) “Good
Reason” means: 
 (A) a material diminution of Employee’s then-existing annual base salary (other
than in connection with an action affecting a majority of the executive officers of the Company); 
 (B)
relocation of the principal place of Employee’s employment to a location that is more than 50 miles from the principal place of Employee’s employment immediately prior to the date of the Change in Control; or 
 (C) a material reduction in the Employee’s authority, duties or responsibilities after the Change in Control when
compared to Employee’s authority, duties and responsibilities prior to the Change in Control; 
 provided that
notwithstanding the foregoing, an Employee’s termination will not be for Good Reason unless the Employee (x) notifies the Company in writing of the existence of the condition which the Employee believes constitutes Good Reason within 60
days of the initial existence of such condition (which notice specifically identifies such condition), (y) gives the Company at least 10 days following the date on which the Company receives such notice (and prior to termination) in which to
remedy the condition, and (z) if the Company does not remedy such condition within such period, actually terminates employment within 15 days after the expiration of such remedy period (and before the Company remedies such condition).

 (iv) “Equity Awards” means all options to purchase shares
of Company common stock as well as any and all other stock-based awards granted to the Employee, including but not limited to stock bonus awards, restricted stock, restricted stock units or stock appreciation rights, except for performance stock
awards which remain subject to performance criteria as of the Effective Date. 
 Section 2.02. Resignation of Corporate
Offices. In connection with any termination of employment following a Change in Control, Employee will resign Employee’s office, if any, as a director, officer, trustee or employee of the Company, its subsidiaries or affiliates and of any
other corporation or trust of which Employee serves as such at the request of the Company, effective as of the date of termination of employment. 
 Section 2.03. Accrued Compensation and Benefits. In connection with any termination of employment upon or following a Change in Control (whether or not under Section 2.01 above), the
Company shall pay Employee’s earned but unpaid base salary and other vested but unpaid cash entitlements for the period through and including the termination of employment, including unused earned vacation pay and unreimbursed documented
business expenses incurred by Employee prior to the date of termination (collectively “Accrued Compensation and Expenses”), as required by law and the applicable Company plan or policy. In addition, Employee shall be entitled to any
other vested benefits earned by Employee for the period through and including the termination date of Employee’s employment under any other employee benefit plans and arrangements maintained by the Company, in accordance with the terms of such
plans and arrangements, except as modified herein (collectively “Accrued Benefits”). Any Accrued Compensation and Expenses to which the Employee is entitled shall be paid to the Employee in cash as soon as administratively
practicable after the termination, and, in any event, no later than two and one-half (2 1/2) months after the end of the taxable year of the Employee in which the termination occurs. Any Accrued Benefits to which the Employee is entitled shall be paid to the Employee as provided in the relevant
plans and arrangement. 
 Section 2.04. Continuing Obligations. Employee acknowledges his or her continuing
obligations under the Confidential and Non-Disclosure Agreement with the Company, including but not limited to Employee’s obligations not to use or disclose, at any time, any trade secret, confidential or proprietary information of the Company.

 Section 2.05. Limitation on Payments. 
 (a) If the Change in Control Severance Benefits together with any other payment or benefit Employee would receive pursuant to a Change in
Control (collectively, “Payment”) would (i) constitute a “parachute payment” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), and (ii) but
for this sentence, be subject to the excise tax imposed by Section 4999 of the Code

 
(the “Excise Tax”), then such Payment shall be equal to the Reduced Amount. The “Reduced Amount” shall be either (x) the largest portion of the Payment that
would result in no portion of the Payment being subject to the Excise Tax or (y) the largest portion, up to and including the total, of the Payment, whichever amount, after taking into account all applicable federal, state and local employment
taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate), results in Employee’s receipt, on an after-tax basis, of the greater amount of the Payment notwithstanding that all or some portion of the Payment
may be subject to the Excise Tax. If a reduction in payments or benefits constituting “parachute payments” is necessary so that the Payment equals the Reduced Amount, reduction shall occur in the following order: reduction of cash
payments; cancellation of acceleration of vesting; reduction of non-cash employee benefits. In the event that acceleration of vesting is to be reduced, it shall be cancelled in the reverse order of the date of grant of the Equity Awards. To the
extent any such benefit is to be provided over time, then the benefit shall be reduced in reverse chronological order. 
 (b)
The Company may engage the accounting firm engaged by the Company for general audit purposes as of the day prior to the effective date of the Change in Control or another firm to perform the foregoing calculations. The Company shall bear all
expenses with respect to the determinations by such firm required to be made hereunder. 
 (c) The accounting firm engaged to
make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to Employee and the Company within fifteen (15) calendar days after the date on which Employee’s right to a Payment is
triggered (if requested at that time by Employee or the Company) or such other time as requested by Employee or the Company. 
 ARTICLE 3 
 MISCELLANEOUS 
 Section 3.01. Assignment; Successors and Assigns. This Agreement shall inure to the benefit of and be enforceable by Employee’s personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees, and legatees. If Employee should die or become subject to a permanent disability while any amount is owed but unpaid to Employee hereunder, all such amounts, unless otherwise provided
herein, shall be paid to Employee’s devisee, legatee, legal guardian or other designee, or if there is no such designee, to Employee’s estate. Employee’s rights hereunder shall not otherwise be assignable. This Agreement shall be
binding on the Company’s successors and assigns. 
 Section 3.02. Dispute Resolution. To ensure rapid and
economical resolution of any and all disputes that might arise in connection with this Agreement, Employee and the Company agree that any and all disputes, claims, and causes of action, in law or equity, arising from or relating to this Agreement or
its enforcement, performance, breach, or interpretation, will be resolved solely and exclusively by final, binding, and

 
confidential arbitration, by a single arbitrator, in San Francisco, California, and conducted by Judicial Arbitration & Mediation Services, Inc. (“JAMS”) under its
then-existing employment rules and procedures. Nothing in this section, however, is intended to prevent either party from obtaining injunctive relief in court to prevent irreparable harm pending the conclusion of any such arbitration. Each party to
an arbitration or litigation hereunder shall be responsible for the payment of its own attorneys’ fees. 
 Section 3.03. Unfunded Agreement. The obligations of the Company under this Agreement represent an unsecured, unfunded promise to pay benefits to Employee and/or Employee’s beneficiaries, and shall not entitle Employee or
such beneficiaries to a preferential claim to any asset of the Company. 
 Section 3.04. Non-Exclusivity of
Benefits. Unless specifically provided herein, neither the provisions of this Agreement nor the benefits provided hereunder shall reduce any amounts otherwise payable, or in any way diminish Employee’s rights as an employee of the Company,
whether existing now or hereafter, under any compensation and/or benefit plans (qualified or nonqualified), programs, policies, or practices provided by the Company, for which Employee may qualify; provided that the Change in Control
Severance Benefits shall not be duplicative of any severance benefits under any such plans, programs, policies or practices and that any amounts payable to Employee hereunder shall be reduced by any amounts paid to Employee as required by any
applicable federal, state or local law (including without limitation the WARN Act) in connection with any termination of Employee’s employment. Vested benefits or other amounts which Employee is otherwise entitled to receive under any plan,
policy, practice, or program of the Company (i.e., including, but not limited to, vested benefits under any qualified or nonqualified retirement plan, but not including severance benefits), at or subsequent to the termination date shall be
payable in accordance with such plan, policy, practice, or program except as expressly modified by this Agreement. 
 Section 3.05. Mitigation. In no event shall Employee be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to Employee under any of the provisions of this Agreement nor shall
the amount of any payment or benefit hereunder be reduced by any compensation earned by Employee as a result of employment by another employer. 
 Section 3.06. Entire Agreement. This Agreement represents the entire agreement between Employee and the Company and its affiliates with respect to Employee’s severance rights in a Change
in Control situation, and supersedes all prior and contemporaneous discussions, negotiations, and agreements concerning such rights, including, but not limited to, any rights under the Company’s Executive Separation Policy. 
 Section 3.07. Tax Withholding. Notwithstanding anything in this Agreement to the contrary, the Company shall withhold from any
amounts payable under this Agreement all federal, state, city, or other taxes as are legally required to be withheld. 

 Section 3.08. Waiver of Rights. The waiver by either party of a breach of any
provision of this Agreement shall not operate or be construed as a continuing waiver or as a consent to or waiver of any subsequent breach hereof. 
 Section 3.09. Severability. In the event any provision of the Agreement shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of
the Agreement, and the Agreement shall be construed and enforced as if the illegal or invalid provision had not been included. 
 Section 3.10. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California without reference to principles of conflict of laws. 
 Section 3.11. Counterparts. This Agreement may be signed in several counterparts, each of which shall be an original, with the
same effect as if the signatures thereto and hereto were on the same instrument. 
 Section 3.12. Code
Section 409A. This Agreement and the payments and benefits hereunder are intended to qualify for the short-term deferral exception to Section 409A of the Code, and all regulations, rulings and other guidance issued thereunder, all as
amended and in effect from time to time (“Section 409A”), described in Treasury Regulation Section 1.409A-1(b)(4) to the maximum extent possible, and to the extent they do not so qualify, they are intended to qualify for the
involuntary separation pay plan exception to Section 409A described in Treasury Regulation Section 1.409A-1(b)(9)(iii) to the maximum extent possible. To the extent Section 409A is applicable to this Agreement, this Agreement is
intended to comply with Section 409A. Without limiting the generality of the foregoing, if on the date of termination of employment Employee is a “specified employee” within the meaning of Section 409A as determined in accordance
with the Company’s procedures for making such determination, to the extent required in order to comply with Section 409A, amounts that would otherwise be payable under this Agreement during the six-month period immediately following the
termination date shall instead be paid on the first business day after the date that is six months following the termination date. All references herein to “termination date” or “termination of employment” shall mean separation
from service as an employee within the meaning of Section 409A. The Company makes no representation or warranty and shall have no liability to the Employee or any other person if any provisions of this Agreement are determined to constitute
deferred compensation subject to Section 409A of the Code but do not satisfy an exemption from, or the conditions of, such Section. 
 [Signature page follows] 

 IN WITNESS WHEREOF, the Company and the Employee have executed this Agreement, to be
effective as of the date and year first written above. 
  

			
	BLUE COAT SYSTEMS, INC.
		
	By:	 	  

	Name:	 	
	Title:	 	
	
	EMPLOYEE:
		
	By:	 	  

	Name:	 	
	Title:	 	

 EXHIBIT A 
 GENERAL RELEASE OF ALL CLAIMS 
 In consideration of
the Change in Control Severance Payment to be paid to                      (“Employee”) by Blue Coat Systems, Inc. ( the
“Company”), as described in the attached Executive Change in Control Severance Agreement (the “Agreement”), Employee, on Employee’s own behalf and on behalf of Employee’s heirs, executors, administrators and assigns, to
the fullest extent permitted by applicable law, hereby fully and forever releases and discharges the Company and its past, present and future directors, officers, employees, agents, successors, predecessors, subsidiaries, parent, shareholders,
employee benefit plans and assigns (together called “the Releasees”), from all known and unknown claims and causes of action including, without limitation, any claims or causes of action arising out of or relating in any way to
Employee’s employment with the Company, including the termination of that employment. 
 Employee understands and agrees
that this General Release of All Claims (the “Release”) is a full and complete waiver of all claims including, without limitation, claims of wrongful discharge, constructive discharge, breach of contract, breach of the covenant of good
faith and fair dealing, harassment, retaliation, discrimination, violation of public policy, defamation, invasion of privacy, interference with a leave of absence, personal injury or emotional distress and claims under Title VII of the Civil Rights
Act of 1964, the Fair Labor Standards Act, the Equal Pay Act of 1963, the Americans With Disabilities Act, the Civil Rights Act of 1866, the Age Discrimination in Employment Act of 1967 (ADEA), the California Labor Code, the California Fair
Employment and Housing Act or any other federal or state law or regulation relating to employment or employment discrimination. Employee further understands and agrees that this waiver includes all claims, known and unknown, to the greatest extent
permitted by applicable law. Notwithstanding the foregoing, this Release does not apply to (x) claims which cannot be released as a matter of law, (y) any right Employee may have to enforce the Agreement or (z) Employee’s
eligibility for indemnification in accordance with applicable laws, the charter and bylaws of the Company or any indemnification agreement Employee has with the company. 
 Employee also hereby agrees that nothing contained in this Release shall constitute or be treated as an admission of liability or wrongdoing by the Releasees or Employee. 
 In addition, Employee hereby expressly waives any and all rights and benefits conferred upon Employee by the provisions of Section 1542
of the Civil Code of the State of California, and any law of any jurisdiction of similar effect. Section 1542 states as follows: 
 A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement
with the debtor. 

 If any provision of this Release is found to be unenforceable, it shall not affect the
enforceability of the remaining provisions and the court shall enforce all remaining provisions to the fullest extent permitted by applicable law. 
 This Release constitutes the entire agreement between Employee and Releasees with regard to the subject matter of this Release. It supersedes any other agreements, representations or understandings,
whether oral or written and whether express or implied, which relate to the subject matter of this Release. Employee understands and agrees that this Release may be modified only in a written document signed by Employee and a duly authorized officer
of the Company. 
 Employee agrees that the Company shall have no duty to provide to Employee any severance benefits described
in the Agreement unless and until Employee (a) has signed the Company’s Proprietary Information and Inventions Agreement (“PIIA”) and (b) has returned to the Company any and all of the Company’s property in
Employee’s possession or under Employee’s control (including, but not limited to, cellular phones; computers; keys; credit cards; access badges; Company files or documents, including copies thereof; or facsimile machines). Employee further
agrees that at all times in the future Employee shall remain bound by the PIIA. 
 Employee understands that Employee has the
right to consult with an attorney before signing this Release. Employee also understands that Employee has [21/45] days after receipt of this Release to review and consider this Release, discuss it with an attorney of Employee’s own choosing,
and decide to execute it or not execute it. Employee also understands that Employee may revoke this Release during a period of seven days after Employee signs it and that this Release will not become effective for seven days after Employee signs it
(and then only if Employee does not revoke it). In order to revoke this Release, within seven days after Employee executes this Release Employee must deliver to
                                 at the Company a letter stating that Employee is
revoking it. Employee understands that if Employee chooses to revoke this Release within seven days after Employee signs it, Employee will not receive any Change in Control Severance Payment and the Release will have no effect. 
 [Signature page follows] 

 Employee states that before signing this Release, Employee: 
 Has read it; 
 Understands it; 
 Knows that he or she is giving up important rights; 
 Is aware of his or her right to consult an attorney before signing it; and 
 Has signed it knowingly and voluntarily. 
  

	
	Date:                     
	
	  

	Signature
	
	  

	Print Full Name

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