20070601Report 2nd amended, restated credit support.pdf

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Pacific Power
PacifiCorp Energy
Rocky Mountain Power
825 NE Multnomah, Suite 1900 LCT
Portland, Oregon 97232
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June 1 , 2007
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VIA OVERNIGHT MAIL
Idaho Public Utilities Commission
Statehouse
472 West Washington Street
Boise, ID 83720
Attn: Ms. Jean D. Jewell
Commission Secretary
Re:Case Nos. U-1046-163, PAC-90-4 and PAC-9S-
Order Nos. 21666, 23188, 23468 and 26039
Report of Second Amended and Restated Credit Support Arrangement
Dear Commissioners:
Pursuant to the referenced Orders, PacifiCorp submits to the Commission one set of verified
copies of each of the following documents:
Supplements to Official Statements dated May 23 2007
Second Amended and Restated Letter of Credit and Reimbursement Agreement, dated as
of May 23 , 2007, among the Company, Barclays Bank PLC and BNP Paribas, as Letter
of Credit Issuers and as Co-Syndication Agents, Barclays Bank PLC, as Administrative
Agent, The Bank of Nova Scotia, The Bank of Tokyo-Mitsubishi UFJ, Ltd., and
The Royal Bank of Scotland PLC as Co-Documentation Agents, and the financial
institutions named on the signature pages thereof.
Because PacifiCorp has not issued any new security in connection with the referenced
transaction, no Report of Securities Issued is enclosed.
PacifiCorp entered into the Second Amended and Restated Letter of Credit and Reimbursement
Agreement because it was able to negotiate more favorable pricing terms and conditions.
S:\CORP JIN\Administrative Asst\Bruce\ID Report of Amended !I1d Restated Credit 052507.doc
Idaho Public Utilities Commission
June 1 , 2007
Page 2 of 2
Under penalty of perjury, I declare that I know the contents ofthe enclosed documents, and they
are true, correct, and complete.
Please contact me if you have any questions about this letter or the enclosed documents.
Sincerely,
Bruce N. Williams
Vice President and Treasurer
Enclosures
S:\CORP JIN\Administrative Asst\Bruce\ID Report of Amended !I1d Restated Credit 052507.doc
SUPPLEMENT, DATED MAY 23, 2007 TO SUPPLEMENT, DATED
NOVEMBER 30, 2005 TO SUPPLEMENT, DATED SEPTEMBER 9, 2004
TO OFFICIAL STATEMENT, DATED JANUARY 13,1988
$147,700,000
CUSTOMIZED PURCHASE POLLUTION CONTROL
REVENUE REFUNDING BONDS
(PACIFICORP PROJECT)
545,000,000
City of Forsyth, Rosebud County, Montana
Series 1988
541,200,000
City of Gillette, Campbell County, Wyoming
Series 1988
550,000,000
Sweetwater County, Wyoming
Series 1988A
511,500,000
Sweetwater County, Wyoming
Series 19888
This Supplement, dated May 23, 2007, to the Supplement, dated November 30 2005 (the First Supplement") to the Supplement,
dated September 9, 2004 (the Original Supplement
),
to the Official Statement, dated May 22, 1991, with respect to the above-captioned
Bonds is being delivered in connection with the amendment and restatement of that certain Reimbursement Agreement, dated as of
September 15, 2004 (the Original Reimbursement Agreement
),
as amended and restated by the Amended and Restated Letter of Credit
and Reimbursement Agreement, dated as of November 30, 2005 (the First Amended Reimbursement Agreement'
),
and as so amended and
restated, the Second Amended Reimbursement Agreement
),
among PacifiCorp (the Company'
),
BNP Paribas, a bank organized under
the laws of France, acting through its New York Branch (the Bank"
),
and Barclays Bank PLC, New York Branch Barclays
),
as letter of
credit issuers, Barclays, as administrative agent, and the other financial institutions parties thereto, pursuant to which the Bank has issued
an irrevocable Letter of Credit to support the Bonds (the Original Letter 0/ Credif'), as amended by the First Amendment to the Letter of
Credit dated as of September 15, 2004 (the First Amendment to the Letter 0/ Credif'). In connection with the Second Amended
Reimbursement Agreement, the Bank will deliver to The Bank of New York Trust Company, National Association (as successor to the
corporate trust business of P. Morgan Trust Company, National Association (the successor trustee to Bank One Trust Company, NA
(formerly known as The First National Bank of Chicago)), as successor trustee, the Second Amendment to the Letter of Credit (the Second
Amendment to the Letter a/Credit to support the Bonds.
Except as described below, the terms and provisions of the Second Amendment to the Letter of Credit and the Second Amended
Reimbursement Agreement are, in all material respects, the same as the Letter of Credit as amended by the First Amendment to the Letter
of Credit and the Reimbursement Agreement as amended by the First Amended Reimbursement Agreement, as such terms and provisions
are described in the Original Supplement. Capitalized terms used but not defmed in this Supplement have the respective meanings given to
them in the Original Supplement.
As amended by the Second Amendment to the Letter of Credit, the Letter of Credit will expire on May 23, 2012, unless earlier
terminated or extended.
Additionally, clause (m) of the third paragraph contained in the section entitled "THE REIMBURSEMENT AGREEMENT,
appearing on page 7 of the Original Supplement, is hereby replaced as follows:
(m) MidAmerican shall fail to own (directly or indirectly through one or more Subsidiaries) at least 80% of the
outstanding shares of common stock of the Company; any person or group of persons (within the meaning of Section \3 or 14
the Securities Exchange Act of 1934, as amended), except Berkshire Hathaway Inc. or any wholly-owned subsidiary thereof
shall acquire beneficial ownership (within the meaning of Rule \3d-3 promulgated by the Securities and Exchange Commission
under said Act) of 35% or more of the outstanding shares of common stock of MidAmerican; or, during any period of 14
consecutive calendar months, individuals who were directors of the Company on the first day of such period and any new
director whose election by the board of directors of the Company or nomination for election by the Company s shareholders was
approved by a vote of at least a majority of the directors then still in office who either were directors at the beginning of the
applicable period or whose election or nomination for election was previously so approved, shall cease to constitute a majority of
the board of directors of the Company; or
(End ofText)
Lehman Brothers
SUPPLEMENT, DATED MAY 23,2007
TO SUPPLEMENT, DATED NOVEMBER 30,2005
TO SUPPLEMENT, DATED SEPTEMBER 9, 2004
TO OFFICIAL STATEMENT, DATED MAY 22,1991
$45,000,000
EMERY COUNTY, UTAH
POLLUTION CONTROL REVENUE REFUNDING BONDS
(PACIFICORP PROJECT)
SERIES 1991
This Supplement, dated May 23, 2007, to the Supplement, dated November 30, 2005 (the First Supplement"to the
Supplement, dated September 9, 2004 (the Original Supplement
),
to the Official Statement, dated May 22, 1991 , with
respect to the above-captioned Bonds is being delivered in connection with the amendment and restatement of that certain
Reimbursement Agreement, dated as of September 15, 2004 (the Original Reimbursement Agreement ), as amended and
restated by the Amended and Restated Letter of Credit and Reimbursement Agreement, dated as of November 30, 2005 (the
First Amended Reimbursement Agreement"), and as so amended and restated, the Second Amended Reimbursement
Agreement
),
among PacifiCorp (the Company
),
BNP Paribas, a bank organized under the laws of France, acting through
its New York Branch (the BanK'
),
and Barclays Bank PLC, New York Branch Barclays
),
as letter of credit issuers,
Barclays, as administrative agent, and the other financial institutions parties thereto, pursuant to which the Bank has issued an
irrevocable Letter of Credit to support the Bonds (the Original Letter of Credit
),
as amended by the First Amendment to
the Letter of Credit dated as of September 15, 2004 (the First Amendment to the Letter of Credit
).
In connection with the
Second Amended Reimbursement Agreement, the Bank will deliver to The Bank of New York Trust Company, National
Association (as successor to the corporate trust business of J.P. Morgan Trust Company, National Association (the successor
trustee to Bank One Trust Company, NA (formerly known as The First National Bank of Chicago)), as successor trustee, the
Second Amendment to the Letter of Credit (the Second Amendment to the Letter o/Credit"to support the Bonds.
Except as described below, the terms and provisions of the Second Amendment to the Letter of Credit and the
Second Amended Reimbursement Agreement are, in all material respects, the same as the Letter of Credit as amended by the
First Amendment to the Letter of Credit and the Reimbursement Agreement as amended by the First Amended
Reimbursement Agreement, as such terms and provisions are described in the Original Supplement. Capitalized terms used
but not defined in this Supplement have the respective meanings given to them in the Original Supplement.
As amended by the Second Amendment to the Letter of Credit, the Letter of Credit will expire on May 23, 2012
unless earlier terminated or extended.
Additionally, clause (m) of the third paragraph contained in the section entitled "THE REIMBURSEMENT
AGREEMENT " appearing on page 6 ofthe Original Supplement, is hereby replaced as follows:
(m) MidAmerican shall fail to own (directly or indirectly through one or more Subsidiaries) at least
80% of the outstanding shares of common stock of the Company; any person or group of persons (within the
meaning of Section 13 or 14 of the Securities Exchange Act of 1934, as amended), except Berkshire Hathaway Inc.
or any wholly-owned subsidiary thereof, shall acquire beneficial ownership (within the meaning of Rule I3d-
promulgated by the Securities and Exchange Commission under said Act) of35% or more of the outstanding shares
of common stock of MidAmerican; or, during any period of 14 consecutive calendar months, individuals who were
directors of the Company on the first day of such period and any new director whose election by the board of
directors of the Company or nomination for election by the Company s shareholders was approved by a vote of at
least a majority ofthe directors then still in office who either were directors at the beginning ofthe applicable period
or whose election or nomination for election was previously so approved, shall cease to constitute a majority of the
board of directors of the Company; or
(End ofText)
JPMorgan
SUPPLEMENT, DATED MAY 23,2007
TO SUPPLEMENT, DATED NOVEMBER 30, 2005
TO SUPPLEMENT, DATED SEPTEMBER 9, 2004
TO OFFICIAL STATEMENT, DATED JULY 24,1990
$70,000,000
SWEETWATER COUNTY, WYOMING
POLLUTION CONTROL REVENUE REFUNDING BONDS
(PACIFICORP PROJECT)
SERIES 1990A
This Supplement, dated May 23, 2007, to the Supplement, dated November 30, 2005 (the First Supplement"to the
Supplement, dated September 9, 2004 (the Original Supplement"), to the Official Statement, dated July 24, 1990, with
respect to the above-captioned Bonds is being delivered in connection with the amendment and restatement of that certain
Reimbursement Agreement, dated as of September 15, 2004 (the Original Reimbursement Agreement
),
as amended and
restated by the Amended and Restated Letter of Credit and Reimbursement Agreement, dated as of November 30, 2005 (the
First Amended Reimbursement Agreement"), and as so amended and restated, the Second Amended Reimbursement
Agreement"), among PacifiCorp (the Company
),
BNP Paribas, a bank organized under the laws of France, acting through
its New York Branch (the Banff'
),
and Barclays Bank PLC, New York Branch Barclays
),
as letter of credit issuers
Barclays, as administrative agent, and the other financial institutions parties thereto, pursuant to which the Bank has issued an
irrevocable Letter of Credit to support the Bonds (the Original Letter of Credit"
),
as amended by the First Amendment to
the Letter of Credit dated as of September 15 2004 (the First Amendment to the Letter of Credit"
).
In connection with the
Second Amended Reimbursement Agreement, the Bank will deliver to The Bank of New York Trust Company, National
Association (as successor to the corporate trust business of J.P. Morgan Trust Company, National Association (the successor
trustee to Bank One Trust Company, NA (formerly known as The First National Bank of Chicago)), as successor trustee, the
Second Amendment to the Letter of Credit (the Second Amendment to the Letter of Credit") to support the Bonds.
Except as described below, the terms and provisions of the Second Amendment to the Letter of Credit and the
Second Amended Reimbursement Agreement are, in all material respects, the same as the Letter of Credit as amended by the
First Amendment to the Letter of Credit and the Reimbursement Agreement as amended by the First Amended
Reimbursement Agreement, as such terms and provisions are described in the Original Supplement. Capitalized terms used
but not defined in this Supplement have the respective meanings given to them in the Original Supplement.
As amended by the Second Amendment to the Letter of Credit, the Letter of Credit will expire on May 23, 2012
unless earlier terminated or extended.
Additionally, clause (m) of the third paragraph contained in the section entitled "THE REIMBURSEMENT
AGREEMENT " appearing on page 6 of the Original Supplement, is hereby replaced as follows:
(m) MidAmerican shall fail to own (directly or indirectly through one or more Subsidiaries) at least
80% of the outstanding shares of common stock of the Company; any person or group of persons (within the
meaning of Section 13 or 14 of the Securities Exchange Act of 1934, as amended), except Berkshire Hathaway Inc.
or any wholly-owned subsidiary thereof, shall acquire beneficial ownership (within the meaning of Rule 13d-
promulgated by the Securities and Exchange Commission under said Act) of 35% or more of the outstanding shares
of common stock of MidAmerican; or, during any period of 14 consecutive calendar months, individuals who were
directors of the Company on the first day of such period and any new director whose election by the board of
directors of the Company or nomination for election by the Company s shareholders was approved by a vote of at
least a majority ofthe directors then still in office who either were directors at the beginning of the applicable period
or whose election or nomination for election was previously so approved, shall cease to constitute a majority of the
board of directors of the Company; or
(End of Text)
CITIGROUP
SUPPLEMENT, DATED MAY 23,2007
TO SUPPLEMENT, DATED NOVEMBER 30, 2005
TO SUPPLEMENT, DATED SEPTEMBER 9, 2004
TO OFFICIAL STATEMENT, DATED DECEMBER 17, 1995
$24,400,000
SWEETWATER COUNTY, WYOMING
ENVIRONMENTAL IMPROVEMENT REVENUE BONDS
(P ACIFICORP PROJECT)
SERIES 1995
This Supplement, dated May 23,2007, to the Supplement, dated November 30, 2005 (the First Supplement"to the
Supplement, dated September 9, 2004 (the Original Supplement"), to the Official Statement, dated May 22, 1991 , with
respect to the above-captioned Bonds is being delivered in connection with the amendment and restatement of that certain
Reimbursement Agreement, dated as of September 15, 2004 (the Original Reimbursement Agreement
),
as amended and
restated by the Amended and Restated Letter of Credit and Reimbursement Agreement, dated as of November 30,2005 (the
First Amended Reimbursement Agreement"
),
and as so amended and restated, the Second Amended Reimbursement
Agreement
),
among PacifiCorp (the Company
),
BNP Pari bas, a bank organized under the laws of France, acting through
its New York Branch (the BanR'
),
and Barclays Bank PLC, New York Branch Barclays
),
as letter of credit issuers,
Barclays, as administrative agent, and the other financial institutions parties thereto, pursuant to which the Bank has issued an
irrevocable Letter of Credit to support the Bonds (the Original Letter of Credit"
),
as amended by the First Amendment to
the Letter of Credit dated as of September 15, 2004 (the First Amendment to the Letter of Credit
).
In connection with the
Second Amended Reimbursement Agreement, the Bank will deliver to The Bank of New York Trust Company, National
Association (as successor to the corporate trust business of J.P. Morgan Trust Company, National Association (the successor
trustee to Bank One Trust Company, NA (formerly known as The First National Bank of Chicago)), as successor trustee, the
Second Amendment to the Letter of Credit (the Second Amendment to the Letter of Credit") to support the Bonds.
Except as described below, the terms and provisions of the Second Amendment to the Letter of Credit and the
Second Amended Reimbursement Agreement are, in all material respects, the same as the Letter of Credit as amended by the
First Amendment to the Letter of Credit and the Reimbursement Agreement as amended by the First Amended
Reimbursement Agreement, as such terms and provisions are described in the Original Supplement. Capitalized terms used
but not defined in this Supplement have the respective meanings given to them in the Original Supplement.
As amended by the Second Amendment to the Letter of Credit, the Letter of Credit wiII expire on May 23, 2012,
unless earlier terminated or extended.
Additionally, clause (m) of the third paragraph contained in the section entitled "THE REIMBURSEMENT
AGREEMENT," appearing on page 6 of the Original Supplement, is hereby replaced as follows:
(m) MidAmerican shall fail to own (directly or indirectly through one or more Subsidiaries) at least
80% of the outstanding shares of common stock of the Company; any person or group of persons (within the
meaning of Section 13 or 14 of the Securities Exchange Act of 1934, as amended), except Berkshire Hathaway Inc.
or any wholly-owned subsidiary thereof, shall acquire beneficial ownership (within the meaning of Rule 13d-
promulgated by the Securities and Exchange Commission under said Act) of35% or more of the outstanding shares
of common stock of MidAmerican; or, during any period of 14 consecutive calendar months, individuals who were
directors of the Company on the first day of such period and any new director whose election by the board of
directors of the Company or nomination for election by the Company s shareholders was approved by a vote of at
least a majority of the directors then stilI in office who either were directors at the beginning of the applicable period
or whose election or nomination for election was previously so approved, shall cease to constitute a majority of the
board of directors of the Company; or
(End ofText)
JPMorgan
EXECUTION COpy
SECOND AMENDED AND REST A TED
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
Dated as of May 23, 2007
among
P ACIFICORP
and
BARCLA YS BANK PLC and BNP P ARIBAS
as Letter of Credit Issuers and as Co-Syndication Agents
and
BARCLA YS BANK PLC
as Administrative Agent
and
THE BANK OF NOVA SCOTIA, THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.
and THE ROY AL BANK OF SCOTLAND PLC
as Co-Documentation Agents
and
THE FINANCIAL INSTITUTIONS NAMED ON THE SIGNATURE PAGES HEREOF
relating to:
SWEETWATER COUNTY, WYOMING
Customized Purchase Pollution Control Revenue
Refunding Bonds
(PacifiCorp Project)
Series I988A
Series 1988B
EMERY COUNTY, UTAH
Pollution Control Revenue Refunding Bonds
(PacifiCorp Project)
Series 1991
SWEETWATER COUNTY, WYOMING
Pollution Control Revenue Refunding Bonds
(PacifiCorp Project)
Series 1990A
CITY OF GILLETTE, CAMPBELL COUNTY
WYOMING
Customized Purchase Pollution Control Revenue
Refunding Bonds
(PacifiCorp Project)
Series 1988
SWEETWATER COUNTY, WYOMING
Environmental Improvement Revenue Bonds
(PacifiCorp Project)
Series 1995
CITY OF FORSYTH, ROSEBUD COUNTY
MONTANA
Customized Purchase Pollution Control Revenue
Refunding Bonds
(PacifiCorp Project)
Series 1988
BARCLA YS CAPITAL
and BNP P ARIBAS
as Lead AITangers and Book Runners
CHI 3859O36v.
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS
SECTION 1.01. Certain Defined Terms. .............................................................. ...........................
SECTION 1.02. Computation of Time Periods. ............................................................................
SECTION 1.03. Accounting Terms. ...................
........ ......... ...... ........ ....... ................... ........ ........ ..
SECTION 1.04. Interpretation... ......................... ....................... ............................
"""""""" ...... ..
ARTICLE II AMOUNT AND TERMS OF THE LETTERS OF CREDIT
SECTION 2.01. The Letters of Credit ...............
...... .................... .......... ........ ............ ........ """'" ..
SECTION 2 .02. Letter of Credit Fees. .............
........ ................. ....... .......... .............. .......... ...........
SECTION 2.03. Reimbursement....................................................................
.............................
SECTION 2.04. Tender Advances.................................................................................................
SECTION 2.05. Interest on Advances. ..... .....................................................................................
SECTION 2.06. Payment of Advances..........................................................................................
SECTION 2.07. Prepayments; Reinstatement of Letter of Credit Amounts. ................................
SECTION 2.08. Increased Costs. ....................... ..... .............................................. ........ ................ 20
SECTION 2.09. Payments and Computations. ..............................................................................
SECTION 2.10. Non-Business Days. ........ ....................................................................................
SECTION 2.11. Evidence of Debt.................................................................................................
SECTION 2.12. Syndication; Reimbursement ofLiC Issuers. .....................................................
SECTION 2.13. Obligations Absolute............... ........................... .......
..... ................... ......... .........
SECTION 2.14. Assignments and Participations. .........................................................................
SECTION 2.15. Changes in Respect of Rating Services...............................................................
SECTION 2.16. Taxes................. .....................
"""""""""""""""""""""""""""""""""""""" .
SECTION 2.17. Extension of the Stated Termination Date. ................................ .........................
SECTION 2.18. Substitution of Bank.......... .........................."..................................................... .
ARTICLE III CONDITIONS OF ISSUANCE AND ADVANCES
SECTION 3.01. Conditions Precedent to Amendments to the Letters of Credit. .........................
SECTION 3.02. Additional Conditions Precedent to Issuance of Amendments to the Letters of
Credit.........................................................................................................
SECTION 3.03. Conditions Precedent to Each Advance. .............................................................
ARTICLE IV REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and WaITanties of the Company. ..............................................
ARTICLE V COVENANTS OF THE COMPANY
SECTION 5.01. Affirmative Covenants. """"""""""""""""""""""""""""""""""""""...........
SECTION 5.02. Negative Covenants. ...........................................................................................
ARTICLE VI EVENTS OF DEFAULT
SECTION 6.01. Events of Default. ....
........ ...................... .............................................................
SECTION 6.02. Upon an Event of Default. ..................................................................................41
TABLE OF CONTENTS
(continued)
ARTICLE VII THE AGENTS AND THE LIC ISSUERs
SECTION 7.01. Authorization and Action. ...................................................................................41
SECTION 7.02. Administrative Agent's Reliance, Etc.................................................................
SECTION 7.03. Bank Independent Credit Decision. ........................ ............................................
SECTION 7.04. Indemnification. ..........." .....................................................................................
SECTION 7.05. Barclays and Affiliates. .......................................................................................43
SECTION 7.06. Successor Administrative Agent.........................................................................
ARTICLE VllI MISCELLANEOUS
SECTION 8.01. Amendments, Etc. ...............................................................................................
SECTION 8.02. Notices, Etc. ..... ....,........... ..... ..............,.... .....................,.
.................................. ..
SECTION 8.03. No Waiver; Remedies. ........................................................................................
SECTION 8.04. Right of Set-off; Sharing of Payments. ........................................................... ....45
SECTION 8.05. Indemnification. .........".... ..... ..................,
"""""""""""'" .............,................. ...
SECTION 8.06. Liability of the Banks. .........................................................................................
SECTION 8.07. Costs and Expenses. ............................................................................................
SECTION 8.08. Binding Effect; Entire Agreement. .....................................................................48
SECTION 8.09. Confidentiality. ...............". ......"............. .......................,.... ......................"...... ..
SECTION 8.10. Severability. ..... .................... ..".. .................. ..................".. .."...... ..,.. ................. .
SECTION 8.11. GOVERNING LAW. ..........................................................................................
SECTION 8.12. Waiver of Jury Trial. ..............".......................................... .................................
SECTION 8.13. Consent to Jurisdiction. ..........".................................. .........................................
SECTION 8.14. Headings.... .................".... .............,......... .............".............. ......, ...... ..................
SECTION 8.15. Execution in Counterparts.................................................. .................................
SECTION 8.16. Prior Agreements Superceded.............................................................................
SECTION 8.17. Patriot Act. ....... .................. .......".. .......... ...."...... .........".......... .....".... ....."......... 51
SECTION 8.18. No Novation. ..."................. ........................ ........................... ...... ....................." 51
TABLE OF CONTENTS
(continued)
Schedules
Shares
Exhibits
F ann of Sweetwater Series 1988A Letter of Credit
Fonn of Sweetwater Series 1988B Letter of Credit
F ann of Sweetwater Series 1990A Letter of Credit
Fonn of Sweetwater Series 1995 Letter of Credit
Fonn of Gillette Series 1988 Letter of Credit
Fonn of Emery Series 1991 Letter of Credit
Fonn of Forsyth Series 1988 Letter of Credit
Fonn of Second Amendment to Sweetwater Series 1988A Letter of Credit
F ann of Second Amendment to Sweetwater Series 1988B Letter of Credit
F ann of Second Amendment to Sweetwater Series 1990A Letter of Credit
F ann of Second Amendment to Sweetwater Series 1995 Letter of Credit
Fonn of Second Amendment to Gillette Series 1988 Letter of Credit
Fonn of Second Amendment to Emery Series 1991 Letter of Credit
Fonn of Second Amendment to Forsyth Series 1988 Letter of Credit
Fonn of Opinion ofPacifiCorp General Counsel
Fonn of Securities Account Control Agreement
Fonn of Note
THIS SECOND AMENDED AND RESTATED LETTER OF CREDIT AND
REIMBURSEMENT AGREEMENT, dated as of May 23 , 2007 (this Agreement"), is among
PACIFICORP, a corporation organized and existing under the laws of the State of Oregon (the
Company
),
BARCLA YS BANK PLC, NEW YORK BRANCH Barclays
),
and BNP
PARIBAS, New York Branch BNP"
),
as LlC Issuers (as hereinafter defined) and as Co-
Syndication Agents, Barclays, as Administrative Agent (as hereinafter defined), The Bank of
Nova Scotia, The Bank of Tokyo-Mitsubishi UFJ, Ltd. and The Royal Bank of Scotland pIc, as
Co-Documentation Agents, and the financial institutions listed on the signature pages hereof.
Unless otherwise indicated, a11 capitalized terms used herein shall have the meaning referred to
or set forth in Article I hereof.
PRELIMINARY STATEMENTS
(1) Pursuant to that certain Letter of Credit and Reimbursement Agreement, dated as
of September 15, 2004 (the Original Reimbursement Agreement"), among the Company,
certain financial institutions, Barclays and BNP, as letter of credit issuers, and Barclays, as
administrative agent, Barclays (A) amended and restated, as of September 15, 2004, its
previously issued Irrevocable Letter of Credit No. SBOO 182 dated April 24, 2002, in the form of
Exhibit A hereto (as so amended and restated, the Existing Sweetwater Series 1988A Letter of
Credit'in support of the Sweetwater County, Wyoming Customized Purchase Pollution Control
Revenue Refunding Bonds (PacifiCorp Project) Series 1988A (the Sweetwater Series 1988A
Bonds
);
(B) issued Letter of Credit No. SBO0316, dated as of September 15, 2004, in the form
of Exhibit B hereto (as amended, the Existing Sweetwater Series 1988B Letter of Credit"
replace the Irrevocable Letter of Credit No. 00325536 issued by Bank One, NA dated August 23
2001 , in support of the Sweetwater County, Wyoming Customized Purchase Pollution Control
Revenue Refunding Bonds (PacifiCorp Project) Series 1988B (the Sweetwater Series 1988B
Bonds
);
(C) issued Letter of Credit No. SBO0317, dated as of September 15, 2004, in the form
of Exhibit C hereto (as amended, the Existing Sweetwater Series 1990A Letter of Credit")
replace the Irrevocable Letter of Credit No. 150SBYO0300080 issued by Commerzbank
Aktiengese11schaft, New York Branch dated July 19,2000, in support of the Sweetwater County,
Wyoming Pollution Control Revenue Refunding Bonds (PacifiCorp Project) Series 1990A (the
Sweetwater Series 1990A Bonds
);
(D) issued Letter of Credit No. SBO0318, dated as of
September 15 , 2004, in the form of Exhibit D hereto (as amended, the Existing Sweetwater
Series 1995 Letter of Credit"to replace the Irrevocable Letter of Credit No. 00326160 issued by
Bank One, NA dated February 20, 2002, in support of the Sweetwater County, Wyoming
Environmental Improvement Revenue Bonds (PacifiCorp Project) Series 1995 (the Sweetwater
Series 1995 Bonds
);
and (E) issued a Letter of Credit No. SBO0319, dated as of September 15
2004, in the form of Exhibit E hereto (as amended, the Existing Gillette Series 1988 Letter of
Credit') to replace the Irrevocable Letter of Credit No. 150SBY99330010 issued by
Commerzbank Aktiengesellschaft, New York Branch dated June 7, 1999, in support of the City
of Gillette, Campbell County, Wyoming Customized Purchase Po11ution Control Revenue
Refunding Bonds (PacifiCorp Project) Series 1988 (the Gillette Series 1988 Bonds
(2) Pursuant to the Original Reimbursement Agreement, BNP (A) issued Letter of
Credit No. 91877843, dated as of September 15, 2004, in the form of Exhibit F hereto (as
amended, the Existing Emery Series 1991 Letter of Credit to replace the Irrevocable Letter of
Credit No. 00325130 issued by Bank One, NA dated May 15, 2001 , in support of the Emery
County, Utah Pollution Control Revenue Refunding Bonds (PacifiCorp Project) Series 1991 (the
Emery Series 1991 Bonds and (B) issued Letter of Credit No. 91877842, dated as of
September 15, 2004, in the form of Exhibit G hereto (as amended the Existing Forsyth Series
1988 Letter of Credit to replace the Irrevocable Letter of Credit No. P-220184 issued by
JPMorgan Chase Bank dated December 12, 2001 , in support of the City of Forsyth, Rosebud
County, Montana Customized Purchase Pollution Control Revenue Refunding Bonds (pacifiCorp
Project) Series 1988 (the Forsyth Series 1988 Bonds
(3) The Company, certain financial institutions, the Departing Banks (as hereinafter
defined), the LlC Issuers and the Administrative Agent are parties to that certain Amended and
Restated Letter of Credit and Reimbursement Agreement, dated as of November 30, 2005 (as
amended, supplemented or otherwise modified prior to the date hereof, the Existing
Reimbursement Agreement"), which Existing Reimbursement Agreement amended and restated
the Original Reimbursement Agreement in its entirety.
(4) The Company has requested that Barclays (i) amend the Existing Sweetwater
Series 1988A Letter of Credit by issuing its Second Amendment thereto in the form of Exhibit H
hereto (as previously amended, as so amended and as the same may be further amended, restated
or extended from time to time, the Sweetwater Series 1988A Letter ofCredit"), (ii) amend the
Existing Sweetwater Series 1988B Letter of Credit by issuing its Second Amendment thereto in
the form of Exhibit I hereto (as previously amended, as so amended and as the same may be
further amended, restated or extended from time to time, the Sweetwater Series 1988B Letter of
Credif'), (iii) amend the Existing Sweetwater Series I 990A Letter of Credit by issuing its Second
Amendment thereto in the form of Exhibit J hereto (as previously amended, as so amended and
as the same may be further amended, restated or extended from time to time, the Sweetwater
Series 1990A Letter of Credit'), (iv) amend the Existing Sweetwater Series 1995 Letter of Credit
by issuing its Second Amendment thereto in the form of Exhibit K hereto (as previously
amended, as so amended and as the same may be further amended, restated or extended from
time to time, the Sweetwater Series 1995 Letter ofCredif'and (v) amend the Existing Gillette
Series 1988 Letter of Credit by issuing its Second Amendment thereto in the form of Exhibit L
hereto (as previously amended, as so amended and as the same may be further amended, restated
or extended from time to time, the Gillette Series 1988 Letter ofCredit').
(5) The Company has requested that BNP (i) amend the Existing Emery Series 1991
Letter of Credit by issuing its Second Amendment thereto in the form of Exhibit M hereto (as
previously amended, as so amended and as the same may be further amended, restated or
extended from time to time, the Emery Series 1991 Letter of Credit') and (ii) amend the
Existing Forsyth Series 1988 Letter of Credit by issuing its Second Amendment thereto in the
form of Exhibit N hereto (as previously amended, as so amended and as the same may be further
amended, restated or extended from time to time, the Forsyth Series 1988 Letter ofCredif'
(6) The Banks party hereto have agreed to purchase Shares of the Reimbursement
Obligations (as such terms are defined herein) and the Letters of Credit.
(7) Each Departing Bank has agreed to execute and deliver a Departing Bank
Signature Page pursuant to which such Departing Bank shall cease to be a party to the Existing
Reimbursement Agreement, each Departing Bank's "Share" of the "Commitment" under (and as
defined in) the Existing Reimbursement Agreement shall be tenninated and each Departing Bank
shall not be a Bank hereunder (provided that the indemnities and obligations of the Company
contained in Section 8.05 of the Existing Reimbursement Agreement in favor of each Departing
Bank shall survive the tennination of such Departing Bank's "Share" of the "Commitment"
under the Existing Reimbursement Agreement).
NOW, THEREFORE, in consideration of the premises and in order to (i) induce
Barclays, as an LlC Issuer, to amend the Existing Sweetwater Series 1988A Letter of Credit, the
Existing Sweetwater Series 1988B Letter of Credit, the Existing Sweetwater Series 1990A Letter
of Credit, the Existing Sweetwater Series 1995 Letter of Credit and the Existing Gillette Series
1988 Letter of Credit; (ii) induce BNP, as an LlC Issuer, to amend the Existing Emery Series
1991 Letter of Credit and the Existing Forsyth Series 1988 Letter of Credit, and (iii) induce the
Banks to consent to such amendments and reaffinn their respective Shares of the Reimbursement
Obligations (as such tenDS are hereinafter defined) and the Letters of Credit, the parties hereto
agree that, as of the date hereof, the Existing Reimbursement Agreement is hereby amended and
restated in its entirety as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms.
As used in this Agreement, the following tenDS shall have the following meanings (such
meanings to be equally applicable to both the singular and plural forms of the tenDS defined) :
Administrative Agent' means Barclays, in its capacity as Administrative Agent
for the Banks hereunder, and any successor Administrative Agent.
Administrative Questionnaire means, with respect to each Bank, an
administrative questionnaire in the fonD prepared by the Administrative Agent
completed by such Bank and returned to the Administrative Agent (with a copy to the
Company).
Advance means any Tender Advance, and Advances means Tender Advances
collectively.
Affiliate means, with respect to a specified Person, another Person that directly,
or indirectly through one or more intennediaries, Controls or is Controlled by or is under
common Control with the Person specified. Controf' means 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 ability to exercise voting power, by contract or othelWise.
Controlling and Controlled" have meanings correlative thereto.
Applicable Participation Fee Rate means the amount per annum set forth as the
Applicable Participation Fee Rate for the Applicable Rating Level below, such amount to
change simultaneously with each change in the Applicable Rating Level on the effective
date of each such change:
Applicable Rating Level Applicable Participation
Fee Rate
Level I 200%
Level II 0.250%
Level III 350%
Level IV 0.450%
Level V 600%
Level VI 875%
Applicable Rating Lever' at any time will be detennined on the basis of the
ratings assigned to Company s senior unsecured long-tenD indebtedness by S&P and
Moody s in accordance with the following table. The Applicable Rating Level will
change simultaneously with each change in such ratings on the effective date of each such
change. In the event that there is a split in the respective ratings of S&P and Moody
the Applicable Rating Level shall be detennined based upon the higher rating; provided
that if the rating differential is more than one rating level, the Applicable Rating Level
shall be detennined based upon a rating one rating level higher than the lower rating:
Applicable S&P Moody
Rating Level
Level I A or higher A2 or higher
Level II
Level III BBB+Baal
Level IV BBB Baa2
Level V BBB-Baa3
Level VI below BBB- (or below Baa3 (or
unrated)unrated)
Approved Fund" means any Person (other than a natural Person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in commercial loans
and similar extensions of credit in the ordinary course of its business and that is
administered or managed by (a) a Bank, (b) an Affiliate of a Bank or (c) an entity or an
Affiliate of an entity that administers or manages a Bank.
Authorized Officer means (i) the President and Chief Executive Officer of the
Company, (ii) the Treasurer of the Company, (iii) the Chief Financial Officer of the
Company or (iv) any other officer of the Company designated as such by the officers
referred to in clauses (i), (ii) and (iii) in a written instrument furnished to the
Administrative Agent.
Bank Information has the meaning assigned to that tenD in Section 8.05.
Banks means Barc1ays, BNP and the other Banks listed on the signature pages
hereof and each Eligible Assignee that shall become a party hereto pursuant to Section
2.l4(a).
Barclays has the meaning assigned to that term in the introductory paragraph of
this Agreement.
Base Rate means a fluctuating interest rate per annum that is the higher of (a)
the Federal Funds Rate plus one-half of one percent (V2%) per annum and (b) the rate of
interest announced publicly by the Administrative Agent in New York, New York, from
time to time as its prime rate. Each change in the Base Rate shall take effect
simultaneously with the corresponding change or changes in the Federal Funds Rate or
such prime rate, as the case may be.
BNP" has the meaning assigned to that tenD in the introductory paragraph of this
Agreement.
Bonds means, collectively, the Sweetwater Series 1988A Bonds, the
Sweetwater Series 1988B Bonds, the Sweetwater Series 1990A Bonds, the Sweetwater
Series 1995 Bonds, the Emery Series 1991 Bonds, the Gillette Series 1988 Bonds and/or
the Forsyth 1988 Bonds.
Business Day means a day of the year on which banks are not required or
authorized to close in New York, New York.
Capitalized Lease Obligation means, with respect to any Person, the obligation
of such Person to pay rent or other amounts under any lease of real or personal property
which obligation is required to be classified and accounted for as a capital lease on the
balance sheet of such Person under generally accepted accounting principles (including
the Statement of Financial Accounting Standards No. 13 of the Financial Accounting
Standards Board, but without regard to paragraph 48 of such Statement) and, for purposes
of this Agreement, the amount of such obligation shall be the capitalized amount thereof
determined in accordance with generally accepted accounting principles (including such
Statement No. 13).
Code means the Internal Revenue Code of 1986, as amended from time to time.
Commitment means $296,879,345.
Commodity Forward Contract" means a forward contract (i) pursuant to which
the Company is entitled to make or receive payment based on a differential or contracted
price and the actual spot market of electricity or natural gas and (ii) which is utilized by
the Company to hedge its excess or shortage of net electricity or natural gas for future
months.
Company has the meaning assigned to that term in the introductory paragraph
of this Agreement.
Consolidated Subsidiary means at any date any Subsidiary or other entity the
accounts of which would be consolidated with those of the Company in its consolidated
financial statements if such statements were prepared as of such date.
Control Agreements means, collectively, (i) the Securities Account Control
Agreements, dated as of September 15, 2004, by and among the Company, the
Administrative Agent and the applicable Trustee, as securities intermediary, and (ii) the
Amended and Restated Securities Account Control Agreement, dated as of September 15,
2004, by and among the Company, the Administrative Agent and the applicable Trustee
as securities intermediary, each substantially in the form of Exhibit P hereto, as such
Securities Account Control Agreement may be fi'om time to time amended , supplemented
or modified.
Controlled Group means all members of a controlled group of corporations and
all trades or businesses (whether or not incorporated) under common control which
together with the Company, are treated as a single employer under Section 414(b) or
414(c) of the Code.
Credit Termination Date means such date as the Letters of Credit shall
terminate in accordance with their respective terms.
Date of Issuance means September 15, 2004.
Debt" of any Person means at any date, without duplication, (i) all obligations of
such Person for borrowed money, (ii) all obligations of such Person evidenced by bonds
(other than surety bonds), debentures, notes or other similar instruments, (iii) all
obligations of such Person to pay the deferred purchase price of property or services
except trade accounts payable arising in the ordinary course of business, (iv) all
Capitalized Lease Obligations of such Person, (v) all non-contingent reimbursement
indemnity or similar obligations of such Person in respect of amounts paid under a letter
of credit, surety bond or similar instrument, (vi) all Debt of others secured by a Lien on
any asset of such Person, whether or not such Debt is assumed by such Person, and (vii)
all Debt of others Guaranteed by such Person. Solely for the purpose of calculating
compliance with the requirements of Section 5.02(c), Debt shall not include Debt of the
Company or its Consolidated Subsidiaries arising from the application of Financial
Interpretation Number 45 of the Financial Accounting Standards Board, Financial
Interpretation Number 46 of the Financial Accounting Standards Board or Issue No. 01-
08 of the Emerging Issues Task Force (EITF).
Default means any condition or event which constitutes an Event of Default or
which with the giving of notice or lapse of time or both would, unless cured or waived
become an Event of Default.
Default Rate means a fluctuating interest rate determined in accordance with
the provisions of Section 2.05(c) of this Agreement.
Departing Bank" means each bank under the Existing Reimbursement
Agreement that executes and delivers to the Administrative Agent a Departing Bank
Signature Page.
Departing Bank Signature Page means each signature page to this Agreement
on which it is indicated that the Departing Bank executing the same shall cease to be a
party to the Existing Reimbursement Agreement on the Execution Date.
Dollars and "$" mean lawful money of the United States of America.
Domestic Lending Office means, as to each Bank, its office located at its
address set forth in its Administrative Questionnaire (or identified in its Administrative
Questionnaire as its Domestic Lending Office) or such other office as such Bank may
hereafter designate as its Domestic Lending Office by notice to the Company and the
Administrative Agent.
Effective Federal Funds Rate has the meamng assigned to that tenD in
Section 2.12(b).
Eligible Assignee means (a) a Bank; (b) an Affiliate of a Bank (other than a
natural Person); (c) an Approved Fund; and (d) any other Person (other than a natural
Person) consented to by the LlC Issuers and/or the Company, if, in either case, such
consent is required pursuant to Section 2.14; provided, however, that notwithstanding the
foregoing, "Eligible Assignee" shall not include the Company or any of the Company
Affiliates or Subsidiaries.
Emery Series 1991 Bonds has the meamng assigned to that tenD in the
Preliminary Statements.
Emery Series 1991 Letter of Credit' has the meaning assigned to that tenD in the
Preliminary Statements.
Environmental Laws means any and all federal, state, local and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, pennits
concessions, grants, franchises, licenses, agreements or other governmental restrictions
relating to the environment or to emissions, discharges or releases of pollutants
contaminants, petroleum or petroleum products, chemicals or industrial, toxic or
hazardous substances or wastes into the environment including ambient air, surface water
ground water, or land, or otherwise relating to the manufacture, processing, distribution
use, treatment, storage, disposal, transport or handling of pollutants, contaminants
petroleum or petroleum products, chemicals or industrial, toxic or hazardous substances
or waste or the clean-up or other remediation thereof.
ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time and the regulations promulgated and the rulings issued
thereunder.
Event of Default' has the meaning assigned to that tenD in Section 6.01.
Execution Date means May 23 , 2007, the date this Agreement was executed
and delivered by each ofthe parties hereto.
Existing Emery Series 1991 Letter of Credit' has the meaning assigned to that
term in the Preliminary Statements.
Existing Forsyth Series 1988 Letter of Credit' has the meaning assigned to that
term in the Preliminary Statements.
Existing Gillette Series 1988 Letter of Credit' has the meaning assigned to that
term in the Preliminary Statements.
Existing Letters of Credit' means the Existing Sweetwater Series 1988A Letter
of Credit, the Existing Sweetwater Series 1988B Letter of Credit, the Existing
Sweetwater Series 1990A Letter of Credit, the Existing Sweetwater Series 1995 Letter of
Credit, the Existing Emery Series 1991 Letter of Credit, the Existing Gillette Series 1988
Letter of Credit and the Existing Forsyth Series 1988 Letter of Credit.
Existing Sweetwater Series 1988A Letter of Credit' has the meaning assigned to
that term in the PreHminary Statements.
Existing Sweetwater Series 1988B Letter of Credit' has the meaning assigned to
that term in the Preliminary Statements.
Existing Sweetwater Series 1990A Letter ofCredif' has the meaning assigned to
that term in the Preliminary Statements.
Existing Sweetwater Series 1995 Letter of Credit' has the meaning assigned to
that term in the PreHminary Statements.
Federal Funds Rate means, for any period, a fluctuating interest rate per
annum equal for each day during such period to the weighted average (rounded upwards
to the nearest 1/100 of one percent) of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the next preceding
Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day which is a Business Day, the average (rounded upwards, if
necessary, to the nearest 1/100 of one percent) of the quotations for such day on such
transactions received by the Administrative Agent from three Federal funds brokers of
recognized standing selected by the Administrative Agent.
Fee Letters means, collectively, (i) the Amended and Restated Administrative
Fee Letter, dated as of May 23, 2007, between the Company and the Administrative
Agent, (ii) the Amended and Restated Fronting Bank Fee Letter, dated as of May 23
2007, between the Company and BNP and (iii) the Fee Letter, dated as of April 20, 2007
between the Company, the Administrative Agent and BNP, as each such letter agreement
may be supplemented or amended from time to time; and Fee Letter means any of the
foregoing as the context may require.
Forsyth Series 1988 Bonds has the meaning assigned to that term in the
Preliminary Statements.
Forsyth Series 1988 Letter of Credif' has the meaning assigned to that term in
the Preliminary Statements.
Gillette Series 1988 Bonds has the meaning assigned to that term in the
Preliminary Statements.
Gillette Series 1988 Letter of Credif' has the meaning assigned to that term in
the Preliminary Statements.
Governmental Authority" means any nation or government, any state or other
political subdivision thereof, and any entity exercising executive, legislative, judicial
regulatory or administrative functions of or pertaining to government.
Guaranty" by any Person means any obligation, contingent or otherwise, of such
Person directly or indirectly guaranteeing any Debt or other obligation of any other
Person and, without limiting the generality of the foregoing, any obligation, direct or
indirect, contingent or otherwise, of such Person (i) to purchase or pay (or advance or
supply funds for the purchase or payment of) such Debt or other obligation (whether
arising by virtue of partnership arrangement, by agreement to keep-well, to purchase
assets, goods, securities or services, to take-or-pay or otherwise) or (ii) entered into for
the purpose of assuring in any other manner the obligee of such Debt or other obligation
of the payment thereof or to protect such obligee against loss in respect thereof (in whole
or in part); provided that the term "Guaranty" shall not include endorsements for
collection or deposit in the ordinary course of business. The term Guarantee used as a
verb shall have a correlative meaning.
Hedging Agreement means any rate swap transaction, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap, equity or
equity index option, bond option, interest rate option, foreign exchange transaction, cap
transaction, floor transaction, collar transaction, currency swap transaction, cross-
currency rate swap transaction, currency option or any other similar transaction
(including any option with respect to any of the foregoing transactions) or any
combination of the foregoing transactions.
Indentures means, collectively, (a) the Trust Indenture, dated as of January 1
1988, between the Issuer of the Sweetwater Series 1988A Bonds and the applicable
Trustee, with respect to the Sweetwater Series 1988A Bonds; (b) the Trust Indenture
dated as of January 1 , 1988 , between the Issuer of the Sweetwater Series 1988B Bonds
and the applicable Trustee, with respect to the Sweetwater Series 1988B Bonds; (c) the
Trust Indenture, dated as of November 1 , 1995, between the Issuer of the Sweetwater
Series 1995 Bonds and the applicable Trustee, with respect to the Sweetwater Series 1995
Bonds, as amended and supplemented by the First Supplemental Trust Indenture thereto
dated as of February 1 2002; (d) the Trust Indenture, dated as of May 1 , 1991 , between
the Issuer of the Emery Series 1991 Bonds and the applicable Trustee, with respect to the
Emery Series 1991 Bonds; (e) the Trust Indenture, dated as of January 1 , 1988, between
the Issuer of the Forsyth Series 1988 Bonds and the applicable Trustee, with respect to
the Forsyth Series 1988 Bonds; (t) the Trust Indenture, dated as of July 1 , 1990, between
the Issuer of the Sweetwater Series 1990A Bonds and the applicable Trustee, with respect
to the Sweetwater Series 1990A Bonds; and (g) the Trust Indenture, dated as of January
, 1988, between the Issuer of the Gillette Series 1988 Bonds and the applicable Trustee,
with respect to the Gillette Series 1988 Bonds, in each case as amended, restated
supplemented or otherwise modified; and Indenture means any of the foregoing as the
context may require
Issuer means with respect to (i) the Sweetwater Series 1988A Bonds, the
Sweetwater Series 1988B Bonds, the Sweetwater Series 1990A Bonds and the
Sweetwater Series 1995 Bonds, Sweetwater County, Wyoming; (ii) the Emery Series
1991 Bonds, Emery County, Utah, (iii) with respect to the Gillette Series 1988 Bonds, the
City of Gillette, Campbell County, Wyoming; and (iv) the Forsyth 1988 Bonds, the City
of Forsyth, Rosebud County, Montana.
LIC Issuer means (i) Barclays in its capacity as issuer of certain of the Letters
of Credit or (ii) BNP in its capacity as issuer of certain of the Letters of Credit, and LIC
Issuers means both of them collectively.
Letter of Credit' means any of the Sweetwater Series 1988A Letter of Credit, the
Sweetwater Series 1988B Letter of Credit, the Sweetwater Series 1990A Letter of Credit
the Sweetwater Series 1995 Letter of Credit, the Emery Series 1991 Letter of Credit, the
Gillette Series 1988 Letter of Credit, and the Forsyth Series 1988 Letter of Credit, in each
case as amended or extended, and Letters ofCredif' means all of them collectively.
Lien means any lien, security interest or other charge or encumbrance of any
kind, including the lien or retained security title of a conditional vendor and any
easement, right of way or other encumbrance on title to real property.
Liquidity Drawing shall have the meaning assigned to that tenn in the Letters
of Credit.
Loan Agreements means, collectively, (a) the Loan Agreement, dated as of
January 1 , 1988, between the Issuer of the Sweetwater Series 1988A Bonds and the
Company, with respect to the Sweetwater Series 1988A Bonds; (b) the Loan Agreement
dated as of January 1, 1988, between the Issuer of the Sweetwater Series 1988B Bonds
and the Company, with respect to the Sweetwater Series 1988B Bonds; (c) the Loan
Agreement, dated as of November 1 , 1995, between the Issuer of the Sweetwater Series
1995 Bonds and the Company, with respect to the Sweetwater Series 1995 Bonds, as
amended by the First Supplemental Loan Agreement thereto dated as of February 1
2002; (d) the Loan Agreement, dated as of May 1 , 1991 , between the Issuer of the Emery
Series 1991 Bonds and the Company, with respect to the Emery Series 1991 Bonds; (e)
the Loan Agreement, dated as of January 1 , 1988, between the Issuer of the Forsyth
Series 1988 Bonds and the Company, with respect to the Forsyth Series 1988 Bonds; (t)
the Loan Agreement, dated as of July 1, 1990, between the Issuer of the Sweetwater
Series 1990A Bonds and the Company, with respect to the Sweetwater Series 1990A
Bonds; and (g) the Loan Agreement, dated as of January 1 , 1988 , between the Issuer of
the Gillette Series 1988 Bonds and the Company, with respect to the Gillette Series 1988
Bonds, in each case as amended, restated, supplemented or otherwise modified; and
Loan Agreement means any of the foregoing as the context may require.
Majority Banks means at any time Banks having at least a majority of the then
aggregate unpaid principal amount of the Reimbursement Obligations, or, if no such
principal amount is then outstanding, Banks whose Shares equal at least a majority of the
aggregate Shares.
Material Debt' means Debt of the Company arising under a single or series of
related instruments or other agreements exceeding $35,000 000 in principal amount.
Material Hedging Obligation means payment obligations in respect of one or
more Hedging Agreements with a single counterparty which have Negative Tennination
Values exceeding $35 000 000 in aggregate amount.
Material Plan means at any time a Plan or Plans having aggregate Unfunded
Liabilities in excess of $50 000 000.
Maximum Credit Amount' in effect at any time means the maximum amount
available to be drawn at such time under a Letter of Credit, the detennination of such
maximum amount to assume compliance with all conditions for drawing and no reduction
for any amount not available to be drawn because Bonds are held by or for the account of
the Company (other than Pledged Bonds).
MidAmerican means MidAmerican Energy Holdings Company.
Moody means Moody s Investors Service, Inc.
Multiemployer Plan means at any time an employee pension benefit plan
within the meaning of Section 4000l(a)(3) of ERISA to which any member of the
Controlled Group is then making or accruing an obligation to make contributions or has
within the preceding five plan years made contributions, including for these purposes any
Person which ceased to be a member of the Controlled Group during such five year
period.
Negative Termination Value means, with respect to any Hedging Agreement of
the Company, the amount (if any) that the Company would be required to pay if such
Hedging Agreement were tenninated by reason of a default by or other tennination event
relating to the Company, such amount to be detennined on the basis of an estimate made
by the Company in good faith. The Negative Tennination Value of any such Hedging
Agreement at any date shall be detennined (i) as of the end of the most recent fiscal
quarter of the Company ended on or prior to such date if such Hedging Agreement was
then outstanding or (ii) as of the date such Hedging Agreement is entered into if it is
entered into after the end of such fiscal quarter. However, if an applicable agreement
between the Company and the relevant counterparty provides that, upon any such
termination by such counterparty, one or more other Hedging Agreements (if any then
exist) between the Company and such counterparty would also terminate and the amount
(if any) payable by the Company would be a net amount reflecting the termination of all
the Hedging Agreements so terminated, then the Negative Termination Value of all the
Hedging Agreements subject to such netting shall be, at any date, a single amount equal
to such net amount (if any) payable by the Company, determined as of the later of (i) the
end of the most recently ended fiscal quarter of the Company or (ii) the date on which the
most recent Hedging Agreement subject to such netting was entered into.
Note means a promissory note of the Company payable to the order of any
Bank, in substantially the form of Exhibit Q hereto.
Officer s Certificate means a certificate signed by the President, the Chief
Financial Officer, a Vice President or the Treasurer of the Company.
Official Statement' means each Official Statement executed in connection with
the Bonds at the time of issuance thereof, as amended or supplemented, together with the
documents incorporated therein by reference.
Operative Documents means the Loan Agreements, the Indentures, the Pledge
Agreements, the Control Agreements and the Remarketing Agreements, in each case, as
from time to time amended, supplemented or modified.
Other Taxes has the meaning assigned to that term in Section 2.16(a).
Participanf' has the meaning assigned to that term in Section 2.14(b).
PBGC' means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
Person means an individual, partnership, corporation (including a business
trust), joint stock company, limited liability company, trust, unincorporated association
joint venture or other entity, or a government or any political subdivision or agency
thereof.
Plan means at any time an employee pension benefit plan (other than
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the minimum
funding standards of Section 412 of the Code and is either (i) maintained, or contributed
, by any member of the Controlled Group for the employees of any member of the
Controlled Group or (ii) has at any time within the preceding five years been maintained
or contributed to, by any Person which was at such time a member of the Controlled
Group for employees of any Person which was at such time a member of the Controlled
Group.
Pledge Agreements means, collectively, (i) the Pledge Agreements, dated as of
September 15, 2004, between the Company and the Administrative Agent, and (ii) the
Amended and Restated Pledge Agreement, dated as of September 15 2004, between the
Company and the Administrative Agent, in each case as amended, restated, supplemented
or otherwise modified; and Pledge Agreement" means any of the foregoing as the
context may require.
Pledged Bonds has the meamng assigned to that term in each Pledge
Agreement.
Pollution Bonds means bonds issued for the purpose of fmancing all or any part
of the cost of facilities acquired or constructed for use by the Company; provided that the
interest on such bonds is exempt from tax under the Code as in effect when the debt
evidenced by such bond is incurred.
Pollution LC' means a letter of credit issued for the purpose of (i) supporting
payments of principal and interest on Pollution Bonds or (ii) providing funds to purchase
Pollution Bonds from the holders thereof.
Principal Amount has the meaning assigned to that term in Section 2.12(b).
Qualifying Junior Subordinated Debt" means subordinated debt of the
Company which has (i) an original maturity of 20 years or more; (ii) provisions
permitting the Company to defer the payment of interest for a period or periods of 20
consecutive quarters or more; (iii) no principal payments that are due and payable until
after the Stated Termination Date; and (iv) all other characteristics (except interest rate)
materially no less favorable to the Company than the Company 8'14% Junior
Subordinated Deferrable Interest Debentures, Series C maturing on June 30, 2036 and
described in PacifiCorp Capital I's Prospectus Supplement dated June 6, 1996.
Regulatory Change means, with respect to any Bank, any change effective after
the Execution Date in United States Federal, state or foreign law or regulations (including
Regulation D) or the adoption or making after such date of any interpretation, directive or
request applying to a class of financial institutions including such Bank of or under any
United States Federal, state or foreign law or regulations (whether or not having the force
of law) by any court or governmental or monetary authority charged with the
interpretation or administration thereof.
Reimbursement Obligations means the obligations of the Company pursuant to
Sections 2., 2., 2.05, 2.06 and 2.07(b) of this Agreement with respect to each
drawing under a Letter of Credit and each Advance.
Remarketing Agent' means (a) Lehman Brothers, with respect to the Sweetwater
Series 1988A Bonds; (b) Lehman Brothers, with respect to the Sweetwater Series 1988B
Bonds; (c) J.P. Morgan Securities Inc. (successor to Bane One Capital Markets, Inc.
with respect to the Sweetwater Series 1995 Bonds; (d) J.P. Morgan Securities Inc.
(successor to Bane One Capital Markets, Inc.), with respect to the Emery Series 1991
Bonds; (e) Lehman Brothers, with respect to the Forsyth Series 1988 Bonds; (f) Citigroup
Global Markets Inc. (formerly known as Citicorp Securities, Inc.), with respect to the
Sweetwater Series 1990A Bonds; and (g) Lehman Brothers, with respect to the Gillette
Series 1988 Bonds, in each case appointed pursuant to the applicable Remarketing
Agreement.
Remarketing Agreements means, collectively, each Remarketing Agreement
executed by the Company and the applicable Remarketing Agent with respect to each of
the Bonds, in each case as amended, restated, supplemented or otherwise modified; and
Remarketing Agreemenf' means any of the foregoing as the context may require.
S&P" means Standard & Poor s Ratings Services, a division of The McGraw-
Hill Companies, Inc.
Share means, with respect to any Bank, the percentage set forth opposite such
Bank's name on Schedule I hereto, as adjusted from time to time pursuant to Section
14.
Stated Termination Date means May 23 2012, the date that is 5 years from the
Execution Date, as such date may be extended in accordance with Section 2.17.
Subsidiary means any corporation or other entity of which securities or other
ownership interests having ordinary voting power to elect a majority of the board of
directors or other persons performing similar functions are at the time directly or
indirectly owned by the Company.
Supplement to Official Statement" means any supplement (including any
sticker" or "wrap ) to any Official Statement prepared in connection with the issuance
and delivery or extension of the Letters of Credit.
Sweetwater Series 1988A Bonds has the meaning assigned to that term in the
Preliminary Statements.
Sweetwater Series 1988B Bonds has the meaning assigned to that term in the
Preliminary Statements.
Sweetwater Series 1990A Bonds has the meaning assigned to that term in the
Preliminary Statements.
Sweetwater Series 1995 Bonds has the meaning assigned to that term in the
Preliminary Statements.
Sweetwater Series 1988A Letter of Credit" has the meaning assigned to that
term in the Preliminary Statements.
Sweetwater Series 1988B Letter of Credit" has the meaning assigned to that
term in the Preliminary Statements.
Sweetwater Series 1990A Letter of Credit" has the meaning assigned to that
term in the Preliminary Statements.
Sweetwater Series 1995 Letter of Credit" has the meaning assigned to that term
in the Preliminary Statements.
Tangible Net Worth" means at any date the consolidated shareholders' equity of
the Company and its Consolidated Subsidiaries less their Intangible Assets, all
detennined as of such date. For purposes of this definition Intangible Assets means the
amount (to the extent reflected in detennining such shareholders' equity) of (i) all write-
ups (other than write-ups resulting from foreign currency translations and write-ups of
assets of a going concem business made within twelve months after the acquisition of
such business) subsequent to December 31 , 2006 in the book value of any asset owned by
the Company or its Consolidated Subsidiaries, (ii) unamortized debt discount and expense
and unamortized deferred charges, but only to the extent that such costs are not
recoverable by the Company through inclusion in the Company s utility rates and (iii)
goodwill, patents, trademarks, service marks, trade names, copyrights, organization or
developmental expenses and other intangible items.
Taxes has the meaning assigned to that tenn in Section 2.l6(a).
Tender Advance has the meaning assigned to that tenn in Section 2.04(a).
Tender Draft" means a Liquidity Drawing under the Letter of Credit to pay the
purchase price of Bonds delivered or deemed delivered to the applicable Trustee or the
applicable Remarketing Agent pursuant to the applicable Indenture and not placed by the
Remarketing Agent on the date such Bonds are to be purchased.
Total Capitalization at any date means, without duplication and after
intercompany eliminations among the Company and its Consolidated Subsidiaries, the
sum of (i) all Debt of the Company and its Consolidated Subsidiaries, (ii) preferred stock
of the Company and (iii) common stock equity of the Company, all determined as of such
date; provided that Qualifying Junior Subordinated Debt shall be included in Total
Capitalization only if and to the extent that the inclusion thereof does not cause the
aggregate amount of all preferred stock and Qualifying Junior Subordinated Debt to
exceed 15% of Total Capitalization.
Total Debf' at any date means, without duplication and after intercompany
eliminations among the Company and its Consolidated Subsidiaries, the sum of (i) all
Debt of the Company and its Consolidated Subsidiaries (other than Qualifying Junior
Subordinated Debt) and (ii) any portion of mandatorily redeemable preferred stock of the
Company or any of its Consolidated Subsidiaries that is a current liability, all detennined
as of such date.
Trustee means The Bank of New York Trust Company, National Association
(as successor to the corporate trust business of J.P. Morgan Trust Company, National
Association, the successor trustee to Bank One Trust Company, NA (formerly known as
The First National Bank of Chicago)) for each of (a) the Sweetwater Series 1988A
Bonds; (b) the Sweetwater Series 1988B Bonds; (c) the Sweetwater Series 1995 Bonds;
(d) the Emery Series 1991 Bonds; (e) the Forsyth Series 1988 Bonds; (f) the Sweetwater
Series 1990A Bonds; and (g) the Gillette Series 1988 Bonds.
Umbrella Mortgage means the Indenture of Mortgage and Deed of Trust dated
as of January 9, 1989 between the Company and The Bank of New York Trust Company,
National Association (as successor to the corporate trust business of JPMorgan Chase
Bank, National Association, the successor to Morgan Guaranty Trust Company of New
York), as Trustee, as amended or supplemented from time to time.
Unfunded Liabilities means, with respect to any Plan at any time, the amount
(if any) by which (i) the present value of all benefits under such Plan exceeds (ii) the fair
market value of all Plan assets allocable to such benefits (excluding any accrued but
unpaid contributions), all detennined as of the then most recent valuation date for such
Plan, but only to the extent that such excess represents a potential liability of a member of
the Controlled Group to the PBGC or any other Person under Title IV of ERISA.
SECTION 1.02. Computation of Time Periods.
In this Agreement, in the computation of a period of time from a specified date to a later
specified date, the word from means from and including and the words and" untif'
each means to but excluding
SECTION 1.03. Accounting Terms.
Unless otherwise specified herein, all accounting tenns used herein shall be interpreted
all accounting detenninations hereunder shall be made, and all fmancial statements required to be
delivered hereunder shall be prepared in accordance with generally accepted accounting
principles as in effect from time to time, applied on a basis consistent (except for changes
concurred in by the Company s independent public accountants) with the most recent audited
financial statements of the Company delivered to the Banks; provided that, if the Company
notifies the Banks that the Company wishes to amend any covenant in Article V to eliminate the
effect of any change in . generally accepted accounting principles on the operation of such
covenant (or if the Majority Banks notify the Company that the Banks wish to amend Article V
for such purpose), then the Company s compliance with such covenant shall be detennined on
the basis of generally accepted accounting principles in effect immediately before the relevant
change in generally accepted accounting principles became effective, until either such notice is
withdrawn or such covenant is amended in a manner satisfactory to the Company and the
Majority Banks; provided further that the effects of application of Statement of Financial
Accounting Standards No. 133
, "
Accounting for Derivative Instruments and Hedging Activities
with respect to unsettled power purchase and power sale contracts of the Company shall be
eliminated in detennining the Company s compliance with the covenants contained in Article V.
Unless the context otherwise requires, all references to financial statements of the Company shall
mean consolidated financial statements of the Company and its Consolidated Subsidiaries.
SECTION 1.04. Interpretation.
The following rules shall apply to the construction of this Agreement unless the context
requires otherwise: (a) the singular includes the plural and the plural the singular; (b) words
importing any gender include the other genders; ( c) references to statutes are to be construed as
including all statutory provisions consolidating, amending or replacing the statute to which
reference is made, and all regulations adopted and publications promulgated pursuant to such
statutes; (d) references to writing include printing, photocopy, typing, lithography and other
means of reproducing words in a tangible visible form; (e) the words including
, "
includes
and include shall be deemed to be followed by the words without limitation (f) references
to articles, sections (or sub-divisions of sections), exhibits, appendices, annexes or schedules are
to those of this Agreement unless otherwise indicated; (g) references to agreements and other
contractual instruments shall be deemed to include an subsequent amendments and other
modifications to such instruments, but only to the extent that such amendments and other
modifications are permitted or not limited by the terms of this Agreement; and (h) references to
Persons include their respective permitted successors and assigns.
ARTICLE II
AMOUNT AND TERMS OF THE LETTERS OF CREDIT
SECTION 2.01. The Letters o/Credit.
Upon the satisfaction of the conditions precedent set forth in Section 3., on the
Execution Date (a) Barclays, as an LlC Issuer hereunder, will (i) amend the Sweetwater Series
1988A Letter of Credit by issuing the Second Amendment thereto in the form of Exhibit H
hereto, and (ii) amend the Sweetwater Series 1988B Letter of Credit by issuing the Second
Amendment thereto in the form of Exhibit I hereto, (iii) amend the Sweetwater Series 1990A
Letter of Credit by issuing the Second Amendment thereto in the form of Exhibit J hereto, (iv)
amend the Sweetwater Series 1995 Letter of Credit by issuing the Second Amendment thereto in
the form of Exhibit K hereto and (v) amend the Gillette Series 1988 Letter of Credit by issuing
the Second Amendment thereto in the form of Exhibit L hereto; (b) BNP, as an LlC Issuer
hereunder, will (i) amend the Emery Series 1991 Letter of Credit by issuing the Second
Amendment thereto in the form of Exhibit M hereto and (ii) amend the Forsyth Series 1988
Letter of Credit by issuing the Second Amendment thereto in the form of Exhibit N hereto.
SECTION 2.02. Letter o/Credit Fees.
(a) The Company hereby agrees to pay the fees specified in the Fee Letters, to the
parties, at the times and in the amounts set forth therein.
(b) The Company agrees to pay to the Administrative Agent for the account of the
Banks, ratably in accordance with their respective Shares, a letter of credit fee on the Maximum
Credit Amount for each Letter of Credit, computed at a rate per annum equal to the Applicable
Participation Fee Rate from the Date of Issuance to the applicable Credit Termination Date of
each Letter of Credit, payable quarterly in arrears on the last day of June 2007 and on the last day
of each September, December, March and June thereafter and on each applicable Credit
Termination Date.
(c) On the Execution Date, the Company shan pay (i) to the Administrative Agent for
the ratable account of the Banks then party to the Existing Reimbursement Agreement, the
accrued and unpaid fees under the Existing Reimbursement Agreement through the Execution
Date and (ii) to the LlC Issuers, any other amounts accrued and unpaid under the Existing
Reimbursement Agreement.
(d) Any amount of fees not paid when due shall bear interest, from the date such
amount of fees was due until the date of payment in full, at the Default Rate, payable on demand
and on the date of payment in full of such amount.
SECTION 2.03. Reimbursement.
Except as otherwise specified in Section 2.04(a), Company hereby agrees to pay to the
Administrative Agent for the account of applicable LlC Issuer any amount drawn under a Letter
of Credit immediately after (and on the same Business Day as) such drawing is paid by an LlC
Issuer, plus interest at the Default Rate payable on demand and on the date of payment in full on
any such amount remaining unpaid from the date such amount becomes due and payable until
payment in full. Each LlC Issuer will pay to the Administrative Agent, for the account of the
Banks, all amounts received by it from the Company for application in payment, in whole or in
part, of the Reimbursement Obligation in respect of Letters of Credit issued by such LlC Issuer
but only to the extent such Bank has made payment to the Administrative Agent, for the account
of such LlC Issuer, in respect of such Letters of Credit pursuant to Section 2.12.
SECTION 2.04. Tender Advances.
(a) If any LlC Issuer shall make any payments under a Letter of Credit pursuant to a
Tender Draft to pay the purchase price of Bonds being purchased upon a tender thereof, and the
conditions set forth in Section 3.03 shall have been fulfilled, such payments shall automatically
be deemed to constitute and shall be an advance made by such LlC Issuer to the Company on the
date and in the amount of such payment, each such advance being a Tender Advance and
collectively the Tender Advances
(b) Subject to Sections 2.07 and 6., the principal amount of each Tender Advance
together with all accrued and unpaid interest thereon, shall be due and payable on the earlier of
(i) the date that is thirty (30) days after the making of such Advance (or if such date is not a
Business Day, the next succeeding Business Day) and (ii) the Stated Tennination Date.
SECTION 2.05. Interest on Advances.
(a) General.The Company shall pay to the Administrative Agent, for the account of
the Banks in proportion to their respective Shares, interest on the unpaid principal amount of
each Tender Advance from the date of such Advance until such principal amount is paid in full at
the applicable rate set forth below.
(b) Base Rate. The Company shall pay to the Administrative Agent, for the account
of the Banks in proportion to their respective Shares, interest on each Advance from the date of
such Advance until the date the principal amount of such Advance becomes due or is prepaid
payable quarterly in arrears and on the date such Advance becomes due or is prepaid, at a
fluctuating interest rate per annum in effect from time to time equal to the sum of (i) the Base
Rate in effect from time to time plus (ii) 1.00%.
(c) Default Interest.The Company shall pay to the Administrative Agent, for the
account of the Banks in proportion to their respective Shares, interest on the unpaid principal
amount of each Advance that is not paid when due and, to the extent permitted by law, on the
unpaid amount of all interest, fees and other amounts payable hereunder that is not paid when
due whether at maturity, by acceleration or otherwise, payable on demand, at a rate per annum
equal at all times to (i) in the case of any amount of principal of Advances, the greater of (x) 2%
per annum above the rate per annum required to be paid on such Advance immediately prior to
the date on which such amount became due and (y) 2% per annum above the Base Rate in effect
from time to time, and (ii) in the case of all other amounts, 2% per annum above the Base Rate in
effect from time to time (the Default Rate
(d) Notice to Trustee.At any time that Bonds are held under a Pledge Agreement, the
LIC Bank, at the request of the applicable Trustee, shall notify such Trustee of the rate of interest
applicable to, and interest payment dates for, outstanding Advances relating to such Pledged
Bonds.
SECTION 2.06. Payment of Advances.
Each Tender Advance shall be due and payable as specified in Section 2.04(b).
SECTION 2. 07. Prepayments; Reinstatement of Letter of Credit Amounts.
(a) The Company may, upon same-day notice to the Administrative Agent, prepay the
outstanding amount of any Advance in whole or in part with accrued interest to the date of such
prepayment on the amount prepaid.
(b) Prior to or simultaneously with the resale or redemption of Bonds acquired by any
Trustee with the proceeds of one or more draws under the Letters of Credit related to such Bonds
by one or more Tender Drafts, or if any Pledged Bonds shall be determined to be invalid, the
Company shall prepay or cause the applicable Trustee on behalf of the Company to prepay the
then outstanding Tender Advances resulting from such draw or draws (in the order in which they
were made) and accrued interest thereon, if any, by paying (or causing to be paid) to the
Administrative Agent (if such prepayment is being made by the Company), for the account of the
Banks in proportion to their respective Shares, or to the applicable LlC Issuer (if such
prepayment is being made by any Trustee), for the account of the Banks in proportion to their
respective Shares, an amount equal to the sum of (i) the aggregate principal amount of the Bonds
being resold or to be resold or being redeemed or that have been determined to be invalid, plus
(ii) accrued interest thereon, for application to the prepayment of such Advances. With respect to
payments of Tender Advances made by any Trustee to any LlC Issuer, such payments, when
such LlC Issuer shall also have received certificates completed and signed by the applicable
Trustee in substantially the form of Annex F to the applicable Letters of Credit, shall be applied
by the Administrative Agent in reimbursement of such drawings (and as prepayment of Tender
Advances resulting from such drawings in the manner described above). Each of the Company
and the Banks irrevocably authorizes the LlC Issuers to rely on such certificate and to reinstate
the applicable Letters of Credit in accordance therewith, and otherwise to reinstate the applicable
Letters of Credit at the times and in the manner specified therein.
SECTION 2.08. Increased Costs.
(a) If any Bank detennines that, as a result of any Regulatory Change other than a
Regulatory Change that would be governed by Section 2.16 of this Agreement, the amount of
capital required or expected to be maintained by such Bank is increased based upon the existence
of a Letter of Credit or such Bank's commitment to make or participate in Advances hereunder
then, upon demand by such Bank, the Company shall immediately pay, from time to time as
specified by such Bank, such amounts as such Bank may reasonably determine to be necessary to
compensate such Bank for any additional costs or for any reduction in such Bank's rate of return
on its capital to the extent that such Bank reasonably determines that such additional costs or
such reduction in such Bank's rate of return on its capital is attributable to the maintenance by
such Bank of capital in respect of a Letter of Credit and such Bank's commitment to make or
participate in Advances hereunder. Notwithstanding the foregoing, the Company shall only be
obligated to compensate such Bank for any amount arising or accruing during (i) the period
commencing 90 days prior to the date on which such Bank gave notice to the Company pursuant
to Section 2.08(b) of the event entitling such Bank to such compensation and (ii) any period
during which, because of the retroactive application of such Regulatory Change, such Bank did
not know that such amount would arise or accrue.
(b) Each Bank will. notify the Company of any Regulatory Change that will entitle
such Bank to compensation pursuant to this Section 2.08 as promptly as practicable. Each Bank
will furnish to the Company a certificate setting forth in reasonable detail the basis for the
amount of each request by such Bank for compensation. Determinations by each Bank of the
amounts required to compensate such Bank shall be conclusive, absent manifest error.
SECTION 2.09. Payments and Computations.
(a) The Company shall make each payment hereunder without condition or deduction
for any counterclaim, defense, recoupment or setoff (i) in the case of amounts due pursuant to
Section 2.03 and 2.07(b), not later than 2:00 P.M. (New York City time), and (ii) in all other
cases, not later than 12:00 Noon (New York City time) on the day when due in lawful money of
the United States of America to the Administrative Agent, for the account of the applicable LlC
Issuer or the Banks, as appropriate, at its address referred to in Section 8., in same day funds
except that payments pursuant to Sections 2., 2., 8.06 and 8.07 shall be made directly to the
Person entitled thereto. The Administrative Agent shall distribute any such payments received
by it for the account of any other Person to the appropriate recipient promptly following receipt
thereof. Computations of the fees hereunder and the Base Rate (if calculated on the basis of the
Administrative Agent's prime rate) and Default Rate shall be made by the Administrative Agent
on the basis of a 365/366 day year, as the case may be, for the actual number of days (including
the first day but excluding the last day) elapsed. Computations of the Base Rate (if calculated on
the basis of the Federal Funds Rate) shall be made by the Administrative Agent on the basis of a
360 day year for the actual number of days (including the first day but excluding the last day)
elapsed.
(b) If, after the Administrative Agent has paid to any LlC Issuer or any Bank any
amount pursuant to subsection (a) above, such payment is rescinded or must othelWise be
returned or must be paid over by the Administrative Agent or any LlC Issuer to any Person
whether pursuant to any bankruptcy or insolvency law, or otherwise, such Bank shall, at the
request of the Administrative Agent or such LlC Issuer promptly repay to the Administrative
Agent or such LlC Issuer, as the case may be, an amount equal to its ratable share of such
payment, together with any interest required to be paid by the Administrative Agent or such LlC
Issuer with respect to such payment. Upon each Bank's repayment in full of its ratable share of
such payment, the Company agrees that to the extent of such repayment, such Bank shall be
deemed to be a direct creditor of the Company.
SECTION 2.10. Non-Business Days.
Whenever any payment to be made hereunder shall be stated to be due on a day which is
not a Business Day, such payment shall be made on the next succeeding Business Day, and such
extension of time shall in such case be included in the computation of payment of interest or
commission, as the case may be.
SECTION 2.11. Evidence of Debt.
On the Execution Date, the Company shall issue Notes payable to the order of any Bank
that shall request such Note. The Administrative Agent shall maintain in accordance with its
usual practice an account or accounts evidencing the indebtedness of the Company resulting from
each drawing under a Letter of Credit and from each Advance made from time to time hereunder
and the amounts of principal and interest payable and paid from time to time hereunder and of
the respective Shares of the Reimbursement Obligations of the Banks. In any legal action or
proceeding in respect of this Agreement, the entries made in such account or accounts shall, in
the absence of manifest error, be conclusive evidence of the existence and amounts of the
obligations of the Company therein recorded. Upon the written request of the Company, the
Administrative Agent agrees to provide to the Company a statement of the amounts owed the
Banks under this Agreement.
SECTION 12. Syndication; Reimbursement of liC Issuers.
(a) Each LlC Issuer hereby sells and transfers to each Bank, and each Bank hereby
purchases and acquires from each LlC Issuer, an undivided interest and participation, to the
extent of such Bank's Share in and to the Letters of Credit issued by such LIC Issuer, including
the obligations of such LlC Issuer under and in respect thereof, the Tender Advances and the
Reimbursement Obligations; provided that such LlC Issuer shall remain the sole party obligated
to make payments under the Letters of Credit issued by such LlC Issuer.
(b) In the event that any LlC Issuer shall make any payment under a Letter of Credit
and the Company shall not reimburse such LlC Issuer immediately on the same Business Day
and in full for such payment (the difference between the amount of such payment and the amount
reimbursed by the Company being the Principal Amount"), the Administrative Agent will
promptly notify each of the other Banks of such Principal Amount and each such Bank will
immediately and unconditionally pay to the Administrative Agent (i) on the same Business Day
if the Administrative Agent provides such Bank with telephonic notice received not later than
3:00 P.M. (New York City time) on such Business Day, or (ii) not later than 12:00 Noon (New
York City time) on the Business Day next succeeding the Business Day such notice is received
if such notice is received after 3:00 P.M. (New York City time) on a Business Day, an amount
equal to its Share of the Principal Amount in United States dollars and in same day funds in
payment for its Share of the Reimbursement Obligations with respect to such Principal Amount
plus compensation, payable on demand, from and including the date when such Principal
Amount becomes outstanding to, but not including, the date such Bank's Share of the Principal
Amount is paid at the Effective Federal Funds Rate plus any applicable amounts pursuant to the
Rules of Interbank Compensation of the Council on International Banking or the New York
Clearinghouse Compensation Committee, as the case may be, in effect from time to time.
Effective Federal Funds Rate means, for any day, the weighted average of the rates on
ovemight Federal Funds transactions with members of the Federal Reserve System, as published
for such day by the Federal Reserve Bank of New York. Upon payment in full for its Share of
such Reimbursement Obligations pursuant to this Section 2.12(b), the Company agrees that to the
extent of such payment, such Bank shall be deemed to be a direct creditor of the Company.
( c) If any Bank shall default in the payment when due of its Share of any
Reimbursement Obligations, in addition to any other claim or remedy the applicable LlC Issuer
may have against such Bank, such Bank shall not be entitled to receive any payments pursuant to
this Agreement or otherwise have any other rights hereunder until all amounts due and payable
by such Bank to such LlC Issuer hereunder shall have been paid in full. In furtherance of the
foregoing, if any Bank shall fail to make any payment to any LlC Issuer in accordance with
subsection (b) above, and such failure shall continue for five Business Days following written
notice of such failure from such LlC Issuer to such Bank, such LlC Issuer may acquire, or
subject to Section 2.14, transfer to a third party in exchange for the sum or sums due from such
Bank, such Bank's interest in the related Reimbursement Obligations and all other rights of such
Bank hereunder in respect thereof, without, however, relieving such Bank from any liability for
damages and reasonable costs and expenses suffered by such LlC Issuer as a result of such
failure. The purchaser of any such interest shall be deemed to have acquired an interest senior to
the interest of such Bank and shan be entitled to receive all subsequent payments which such LlC
Issuer or the Administrative Agent would otherwise have made hereunder to such Bank in
respect of such interest.
SECTION 13. Obligations Absolute.
The payment obligations of the Company under this Agreement to reimburse the LlC
Issuers for drawings made under the Letters of Credit and the obligations of the Banks under
Section 2.12 shall be unconditional and irrevocable, and shall be paid strictly in accordance with
the tenDS of this Agreement under all circumstances, including the following circumstances:
(i) any lack of validity or enforceability of the Operative Documents, the
Letters of Credit, the Remarketing Agreements, the Pledge Agreements, the Control
Agreements, the Fee Letters, or any other agreement, certificate or instrument relating
thereto;
(ii) any amendment or waiver of or any consent to departure from an or any of
the Operative Documents;
(iii) the existence of any claim, set-off, defense or other right which the
Company may have at any time against any Trustee or any other beneficiary, or any
transferee, of the Letters of Credit (or any Persons for whom any Trustee, any such
beneficiary or any such transferee may be acting), the Banks, or any other Person whether
in connection with this Agreement, the transactions contemplated herein or in the
Operative Documents, or any unrelated transaction;
(iv) any statement, draft, demand, certificate or any other document presented
under the Letters of Credit proving to be forged, fraudulent, invalid or insufficient in any
respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the LlC Issuers under the Letters of Credit against presentation
of a draft or certificate which does not comply with the terms of such Letter of Credit;
and
(vi) any other circumstance or happening whatsoever, whether or not similar to
any of the foregoing.
SECTION 14. Assignments and Participations.
(a) Each Bank may assign to one or more Eligible Assignees all or a percentage
interest of its rights and obligations under this Agreement but if less than all, then such
assignment shall be in an amount equal to $5 000 000 or an integral multiple thereof and such
assigning Bank shall continue to hold a Share of at least $5 000 000 provided that (i) no
assignment by any Bank may be made to any Eligible Assignee, except with the prior written
consent of (A) the Company, which consent shall not be unreasonably withheld or delayed and
(1) in the case of an assignment to a Bank, an Affiliate of a Bank or an Approved Fund, or (2) if
an Event of Default shall have occurred and be continuing, shall not be required and (B) the LlC
Issuers, which consent may be given or withheld in the sole discretion of the LlC Issuers; (ii) the
LIC Issuers may not assign their direct obligations under the Letters of Credit, and (iii) each such
assignment shall be of a constant, and not a varying, percentage of the assignor s rights and
obligations under this Agreement. The parties to each such assignment shall execute and deliver
to the Administrative Agent an instrument of assignment in form and substance satisfactory to
the Administrative Agent and the Company, and a processing fee of $3 500, and the
Administrative Agent will record in a register maintained for such purpose the name of the
assignee and the percentage participation interest assigned by the assignor and assumed by the
assignee for purposes of the determination of such assignor s and assignee s respective Shares.
Upon such execution, delivery, fee payment, acceptance and recording, from and after the
effective date specified in each assignment, which effective date shall be at least five Business
Days after the delivery thereof to the Administrative Agent, the assignee shall, to the extent of
such assignment, become a party hereto and have all of the rights and obligations of a Bank.
hereunder and, to the extent of such assignment, such assigning Bank shall be released from its
obligations hereunder but shall continue to be entitled to the benefits of Sections 2., 2., 8.05,
06 and 8.07 (without relieving such Bank from any liability for damages, costs and expenses
suffered by the Administrative Agent, the LlC Issuers or the Company as a result of the failure
by such Bank to perform its obligations hereunder).
(b) Each Bank may grant participations to one or more Persons in all or any part of, or
any interest (undivided or divided) in, such Bank's rights and/or obligations under this
Agreement (any such Person being referred to herein as a Participanf'); provided, however, that
(i) such Bank's obligations under this Agreement shall remain unchanged; (ii) such Bank shall
remain solely responsible to the other parties hereto for the performance of such obligations; (iii)
in no event shall such Bank be obligated to the Participant to take or refrain from taking any
action hereunder, except that such Bank may agree with the Participant that it will not, without
the consent of the Participant, agree to (A) the extension of the Stated Termination Date or of any
date fixed for the payment of principal of or interest, fees (if the Participant is entitled to any part
thereof) or any other payment (if the Participant is entitled to any part thereof) pursuant to this
Agreement or the Reimbursement Obligations, (B) the reduction of any payment of principal
thereof, or (C) the reduction of the rate at which either interest is payable thereon or (if the
Participant is entitled to any part thereof) the reduction of the fees payable hereunder to a level
below the rate at which the Participant is entitled to receive interest or such fees (as the case may
be) in respect to such participation; (iv) the Company, the LlC Issuers and the Administrative
Agent shall continue to deal solely and directly with such Bank in connection with such Bank'
rights and obligations under this Agreement; and (v) such Participant shall be entitled to the cost
protection provisions provided for in Sections 2.08 and 2.16; provided, further that the amount
of such cost protection shall not exceed the amount of cost protection to which such Bank selling
such participation would have been entitled under Section 2.08 or 2., as the case may be.
Promptly after any Bank grants any such participation, such Bank shall inform the Company of
the identity of the Participant and the amount of such participation.
(c) Notwithstanding any other provision set forth in this Agreement, any Bank may at
any time create a security interest in all or any portion of its rights under this Agreement
(including the Advances owed to it) in favor of any Federal Reserve Bank in accordance with
Regulation A of the Board of Governors of the Federal Reserve System.
SECTION 15. Changes in Respect of Rating Services.
, prior to the Stated Termination Date, the rating system of either Moody s or S&P shall
change, the parties hereto agree to amend this Agreement to incorporate the revised rating system
of Moody s or S&P as applicable. If, prior to the Stated Termination Date, either Moody s or
S&P shall cease to issue ratings of the Company s senior unsecured non-credit enhanced long-
term debt or no senior unsecured long-term debt of the Company shall be outstanding, the parties
hereto agree to amend this Agreement, as appropriate (i) to designate a successor rating agency
or agencies and to incorporate the rating system or systems of such successor rating agency or
agencies or (ii) to make such other modifications as the parties shall agree.
SECTION 16. Taxes.
(a)
meamngs:
For the purposes of this Section 2.16, the following terms have the following
Taxes means any and all present or future taxes, duties, levies, imposts, deductions
charges or withholdings with respect to any payment by the Company pursuant to this
Agreement, and all liabilities with respect thereto excluding (i) in the case of each Bank and
Administrative Agent, net income taxes imposed by the United States and franchise, income, or
similar taxes, and sales, gross receipts, value added, or similar taxes, imposed on it by a
jurisdiction under the laws of which such Bank or Administrative Agent (as the case may be), is
organized or does business, or any political subdivision thereof, in which its principal executive
office is located or, in the case of each Bank, in which its Domestic Lending Office is located
and (ii) in the case of each Bank, any United States withholding tax imposed with respect to any
payment by the Company pursuant to this Agreement, but only up to the rate (if any) at which
United States withholding tax would apply to such payments to such Bank at the time such Bank
first becomes a party to this Agreement.
Other Taxes means any present or future stamp or documentary taxes and any other
excise or property taxes, or similar charges or levies, which arise from any payment made
pursuant to this Agreement or from the execution or delivery of, or otherwise with respect to, this
Agreement.
(b) Any and all payments by the Company to or for the account of any Bank, any LlC
Issuer or the Administrative Agent hereunder shall be made without deduction for any Taxes or
Other Taxes; provided that if the Company shall be required by law to deduct any Taxes or
Other Taxes from any such payments, (i) the sum payable shall be increased as necessary so that
after making all required deductions for any Taxes or Other Taxes (including deductions
applicable to additional sums payable under this Section) such Bank, such LlC Issuer or the
Administrative Agent (as the case may be) receives an amount equal to the sum it would have
received had no such deductions been made, (ii) the Company shall make such deductions, (iii)
the Company shall pay the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable law and (iv) the Company shall furnish to the
Administrative Agent, at its address referred to in Section 8., the original or a certified copy of
a receipt evidencing payment thereof.
( c) The Company agrees to indemnify each Bank and the Administrative Agent for
the full amount of Taxes or Other Taxes (including any Taxes or Other Taxes imposed or
asserted by any jurisdiction on amounts payable under this Section) paid by such Bank or
Administrative Agent (as the case may be) and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto. This indemnification shall be paid within 30
days after such Bank or Administrative Agent (as the case may be) makes demand therefor.
Such demand shall be made as promptly as practicable.
(d) Each Bank organized under the laws of a jurisdiction outside the United States
shall provide the Company and the Administrative Agent with Internal Revenue Service Form
8BEN, W-8ECI, or other type ofW-8, as appropriate, or any successor form prescribed by the
Internal Revenue Service: (i) on or prior to the date of its execution and delivery of this
Agreement in the case of each Bank listed on the signature pages hereof and on or prior to the
date on which it becomes a Bank in the case of each other Bank, (ii) before the end of each third
calendar year thereafter, and (iii) at any time that a change of circumstances occurs that makes
any information on the form so provided incorrect, certifying that such Bank is entitled to
benefits under an income tax treaty to which the United States is a party which exempts such
Bank from United States withholding tax or reduces the rate of withholding tax on payments
under this Agreement or certifying that the income receivable pursuant to this Agreement is
effectively connected with the conduct of a trade or business in the United States. Further, each
such Bank that is not an exempt recipient listed in 9 6049(b)(4) of the Internal Revenue Code
shall provide the Company and the Administrative Agent with Internal Revenue Service Fonn
8 or W-, as appropriate, or other successor fOnD prescribed by the Internal Revenue Service
certifying that it is exempt from United States back-up withholding.
(e) For any period with respect to which a Bank has failed to provide the Company or
the Administrative Agent with the appropriate fonDS pursuant to Section 2 .l6( d) (unless such
failure is due to a change in treaty, law or regulation occurring subsequent to the date on which
such fonD originally was required to be provided), the Company shall not gross up the payments
as provided under Section 2.l6(b), and such Bank shall not be entitled to indemnification under
Section 2.l6(c) with respect to Taxes imposed by the United States; provided that if a Bank,
which is otherwise exempt from or subject to a reduced rate of withholding tax, becomes subject
to Taxes because of its failure to deliver a form required hereunder, the Company shall take such
steps as such Bank shall reasonably request to assist such Bank to recover such Taxes.
(f) If the Company is required to pay additional amounts to or for the account of any
Bank pursuant to this Section, then such Bank will change the jurisdiction of its Domestic
Lending Office if, in the judgment of such Bank, such change (i) will eliminate or reduce any
such additional payment which may thereafter accrue and (ii) is not otherwise disadvantageous to
such Bank.
(g)
Without prejudice to the survival of any other agreement of the Company
hereunder, the agreements and obligations of the Company contained in this Section 2.16 shall
survive the payment in full of principal and interest hereunder.
SECTION 17. Extension of the Stated Termination Date.
At least 60 but not more than 90 days before the initial Stated Tennination Date, the
Company may request the Banks in writing (each such request being irrevocable) to extend the
Stated Tennination Date for purposes of this Agreement and the Letters of Credit for an
additional 364 days. Notice of such request shall be given by the Company to the Administrative
Agent, which shall give notice thereof to each of the Banks. If the Company shall make such a
request, the Administrative Agent shall, on or before the 45th day after receipt of such request
notify the Company in writing whether or not all of the Banks (including the LlC Issuers)
consent to such request and, if all of the Banks (including the LlC Issuers) do so consent, the
conditions of such consent (including conditions relating to legal documentation and the consent
of the applicable Trustee). If the Administrative Agent shall not so notify the Company, the
Banks (including the LlC Issuers) shall be deemed not to have consented to such request. If all of
the Banks (including the LlC Issuers) consent to such an extension request and the conditions of
such consent are satisfied, the LlC Issuers shall deliver to the applicable Trustee amendments to
the Letters of Credit that extend the Stated Tennination Date thereof.
SECTION 18. Substitution of Bank.
If any Bank has demanded compensation under Section 2.08 or 2., the Company shall
have the right at its sole expense, with the assistance of the Administrative Agent, to seek one or
more mutually satisfactory Eligible Assignees (which may be one or more of the Banks) to
purchase for cash the Share of such Bank in the outstanding Advances and the Commitment and
to assume all of such Bank's other rights and obligations hereunder pursuant to an instrument of
assignment in form and substance reasonably acceptable to the Administrative Agent and
otherwise in accordance with the provisions of Section 2.14(a); provided that (i) any such
assignment shall be without recourse to the assigning Bank, (ii) such assigning Bank shall have
received payment of an amount equal to the outstanding principal of its Advances, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder, from the assignee (to
the extent of such outstanding principal and accrued interest and fees) or the Company (in the
case of all other amounts) and (iii) such assignment will result in a reduction of such
compensation.
ARTICLE III
CONDITIONS OF ISSUANCE AND ADVANCES
SECTION 3.01. Conditions Precedent to Amendments to the Letters of Credit.
The obligations of all the LlC Issuers to amend the Letters of Credit are subject to the
condition precedent that the Administrative Agent shall have received, with sufficient copies for
each Bank (except in the case of the Notes, for which only one copy of each requested Note shall
be required), on or before the date of such amendment and restatement and such issuance, the
following in form and substance satisfactory to the LlC Issuers and the Administrative Agent (it
being contemplated that all of such conditions shall be satisfied on the Execution Date):
(a) Certified copies of (i) the resolutions of the Board of Directors of the Company
approving this Agreement and the other matters contemplated hereby and (ii) all other documents
evidencing other necessary corporate action and governmental approvals, if any, with respect to
this Agreement.
(b) A certificate of the Secretary, an Assistant Secretary or an Associate Secretary of
the Company certifying the names and true signatures of the officers of the Company authorized
to sign this Agreement and the other documents to be delivered by it hereunder.
( c) Counterparts of the Agreement duly executed by or on behalf of the Company and
each other party thereto.
(d) An opinion of the General Counsel of the Company in substantially the form of
Exhibit 0 hereto and as to such other matters as the Administrative Agent may reasonably
request.
( e) A certificate signed by the President, Chief Financial Officer, a Vice President or
the Treasurer of the Company certifying that copies of the Operative Documents delivered to the
Administrative Agent concurrently with the closing of the Existing Reimbursement Agreement
are true, correct and complete, no amendments or modifications thereto have occurred since such
prior delivery date and such Operative Documents are in full force and effect.
(f) For the account of the parties entitled thereto, payment of all fees and other
amounts payable pursuant to the Fee Letters.
(g) A certificate of each Trustee as to the principal amount of Bonds outstanding in
respect of which it is acting as Trustee.
(h) A certificate of an authorized officer of each Trustee certifying the names, true
signatures and incumbency of the officers of such Trustee authorized to make drawings under the
Letter of Credit issued in favor of such Trustee and as to such other matters as the Administrative
Agent may reasonably request.
(i) Notes, duly executed by or on behalf of the Company and made payable to each
of the Banks that has requested such Note.
SECTION 3.02. Additional Conditions Precedent to Issuance of Amendments to the
Letters of Credit.
The obligations of the LlC Issuers to amend the Existing Letters of Credit shall be subject
to the further conditions precedent that on the Execution Date:
(a) The following statements shall be true and the LlC Issuers shall have received an
Officer s Certificate, dated the Execution Date, stating that:
(i) The representations and warranties contained in Section 4.01 of this
Agreement are correct on and as of the Execution Date as though made on and as of such
date; and
(ii) The representations and warranties of the Company contained in the
Operative Documents, except for changes that would not materially adversely affect the
ability of the Company to meet its obligations hereunder and under the Pledge
Agreements, are correct on and as of the Execution Date as though made on and as of
such date; and
(iii) No event has occurred and is continuing, or would result from the
amendment or extension of the Letters of Credit, that constitutes a Default or an Event of
Default.
(b) The Administrative Agent shall have received such other approvals, opinions or
documents as any Bank may reasonably request.
SECTION 3.03. Conditions Precedent to Each Advance.
Each payment made by any LlC Issuer under the Letters of Credit pursuant to a Tender
Draft shall constitute an Advance hereunder only if on the date of such payment the following
statements shall be true and correct:
(i) The representations and warranties contained in Sections 4.01 (other than
those contained in Section 4.01 (a)(ii) hereof) are correct on and as of the date of such
Advance, before and after giving effect to such Advance and to the application of the
proceeds therefrom, as though made on and as of such date;
(ii) The representations and warranties of the Company contained in the
Operative Documents are correct on and as of the date of such Advance, before and after
giving effect to such Advance and to the application ofthe proceeds therefrom, as though
made on and as of such date, except for changes that would not materially adversely
affect the ability of the Company to meet its obligations hereunder and under the Pledge
Agreements; and
(iii) No event has occurred and is continuing, or would result ffom such
Advance or from the application of the proceeds therefrom, that constitutes a Default or
an Event of Default.
Unless the Company shall have previously advised the Administrative Agent in writing or
the Administrative Agent has actual knowledge that one or more of the above statements is no
longer true, the Company shall be deemed to have represented and warranted, on the date of each
payment by any LlC Issuer under the Letters of Credit pursuant to a Tender Draft, and on the
date of making any Advance, that on the date of such payment the above statements are true.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Company.
In order to induce the Banks to enter into this Agreement, the Company represents and
warrants to each of the Administrative Agent, the LlC Issuers and the Banks as follows:
(a)Financial Condition.
(i) The consolidated balance sheet of the Company and its Subsidiaries as at
December 31 , 2006 and the related audited statements of consolidated income and
retained earnings and of consolidated cash flows for the fiscal year then ended, reported
on by Deloitte & Touche LLP, and set forth in the Company s Fonn 10-K for the fiscal
year ending December 31, 2006, a copy of which has been delivered to each of the Banks
fairly present, in confonnity with generally accepted accounting principles, the
consolidated financial position of the Company and its Subsidiaries as at such date, and
their consolidated results of operations and cash flows for such fiscal year; and the
unaudited consolidated balance sheet of the Company and its Subsidiaries as of March
, 2007 and the related unaudited statements of consolidated income and retained
earnings and of consolidated cash flows for the fiscal quarter then ended, set forth in the
Company s Fonn lO-Q for the fiscal quarter ending March 31 , 2007, a copy of which has
been delivered to each of the Banks, fairly present, in confonnity with generally accepted
accounting principles, the consolidated financial position of the Company and its
Subsidiaries as at such date, and their consolidated results of operations and cash flows
for such fiscal quarter, subject to nonnal year end adjustments.
(ii) There has since March 31, 2007 been no change in the business, financial
position, results of operations or prospects of the Company which would materially
adversely affect the ability of the Company to meet its obligations hereunder and under
the Operative Documents.
(b) Corporate Existence and Power. The Company is a corporation duly incorporated
and validly existing under the laws of the State of Oregon. The Company has all corporate
powers and all material governmental licenses, authorizations, consents and approvals required to
carry on its business as now conducted and to execute, deliver and perfonn this Agreement, the
Pledge Agreements and the Operative Documents to which it is a party.
(c) Due Authorization, Etc The execution, delivery and perfonnance by the
Company of this Agreement, Pledge Agreements and the other Operative Documents to which it
is a party will not (i) require any consent or approval of the shareholders of the Company,
(ii) violate any provision of any law, rule, regulation (including Regulation T, U, or X of the
Board of Governors of the Federal Reserve System), order, writ, judgment, injunction, decree
detennination or award presently in effect having applicability to the Company or of the charter
or by-laws of the Company, (iii) result in a breach of or constitute a default under the Company
articles of incorporation, by-laws or any indenture or loan or credit agreement or any other
agreement, lease or instrument to which the Company is a party or by which it or its properties
may be bound or affected, or (iv) result in, or require, the creation or imposition of any Lien
(other than the Lien of the Pledge Agreements and the Control Agreements) upon or with respect
to any of the properties now owned or hereafter acquired by the Company.
(d) Government Authorization. No authorization or approval of, or other action by,
and no notice to or filing with, any Governmental Authority is required to be obtained or made
by the Company for the due execution, delivery and perfonnance by the Company of this
Agreement, the Pledge Agreements or the Operative Documents to which it is a party, other than
such as have been obtained and are in full force and effect or such as may be necessary under the
blue sky laws of any jurisdiction.
(e) Federal Regulations. No portion of the proceeds of the Bonds, the Letter of Credit
or any Advance will be used to purchase or carry any margin stock (as defined in Regulation U
of the Board of Governors of the Federal Reserve System) or to extend credit to others for the
purpose of purchasing or carrying any such margin stock.
(f) Enforceable Obligations. Each of this Agreement, the Pledge Agreements and
each other Operative Document to which the Company is a party constitutes (assuming due
authorization, execution and delivery by the other parties hereto and thereto) a legal, valid and
binding obligation of the Company enforceable against the Company in accordance with its
tenDs, except as (i) the foregoing may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights generally and (ii) rights of
acceleration and the availability of equitable remedies may be limited by equitable principles of
general applicability. The obligations of the Company to the Banks hereunder to pay all amounts
paid by the Banks under the Letters of Credit, interest thereon as provided herein and all other
fees, expenses and amounts hereunder constitute "Senior Indebtedness" for purposes of the
Indenture dated as of May 1, 1995 between the Company and The Bank of New York, as
Trustee.
(g)
Not an Investment Company. The Company is not an "investment company
within the meaning of the Investment Company Act of 1940, as amended.
(h) No Litigation.No litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or, to the knowledge of the Company,
threatened by or against the Company or against any of its properties or revenues (i) with respect
to this Agreement, or any Operative Document or any of the transactions contemplated hereby or
thereby, or (ii) in which there is a reasonable possibility of an adverse detennination which
would materially adversely affect the ability of the Company to meet its obligations hereunder
and under the Operative Documents (except as described in the Company s Annual Report on
Fonn 10-K for the fiscal year ended December 31 2006 or the Quarterly Report on Fonn 10-Q
for the quarter ended March 31 , 2007 filed with the Securities and Exchange Commission
pursuant to the Securities Exchange Act of 1934, as amended).
(i) Taxes. The Company has filed all United States Federal income tax returns and
all other material tax returns which are required to be filed by it and has paid all taxes due
pursuant to such returns or pursuant to any assessment received by the Company. The charges
accruals and reserves on the books of the Company in respect of taxes or other governmental
charges are, in the reasonable opinion of the Company, adequate.
(j)
ERISA.Each member of the Controlled Group has fulfilled its obligations under
the minimum funding standards of ERISA and the Code with respect to each Plan and is in
compliance in all material respects with the presently applicable provisions of ERISA and the
Code with respect to each Plan. No member of the Controlled Group has (i) failed to make any
contribution or payment to any Plan or Multiemployer Plan, or made any amendment to any
Plan, which has resulted or would result in the imposition of a Lien or the posting of a bond or
other security under ERISA or the Code or (ii) incurred any liability under Title IV of ERISA
other than a liability to the PBGC for premiums under Section 4007 of ERISA, except where
such failure or incurrence would not have a material adverse effect on the ability of the Company
to meet its commitments hereunder.
(k) Pledge. The pledge of the Bonds pursuant to the Pledge Agreements and the
Control Agreements has been or will, upon execution of the Pledge Agreements and the Control
Agreements, be duly created and perfected, with the priority contemplated by the Pledge
Agreements and the Control Agreements.
(1) No Default.The Company is not in default in any respect under or with respect to
any material contract, agreement, arrangement or instrument to which it is a party or by which it
or any of its assets may be bound or affected. The Company is not in default under any material
order, award or decree of any court, arbitrator, or other Governmental Authority or other Person
binding upon or affecting it or by which any of its assets may be bound or affected. The
Company is not subject to any order, award or decree which could reasonably be expected to
materially adversely affect its ability to carry on its businesses as presently conducted or as
proposed to be conducted or to perform its obligations under any other order, award or decree.
(m) Official Statement.The information contained in the Official Statement and all
written information provided to the Banks in connection with this Agreement as of their
respective dates is correct in all material respects and does not contain an untrue statement of a
material fact or omit to state a material fact necessary to make the statements made in the Official
Statement, in light of the circumstances under which they were made, not misleading. The
Company makes no representation as to information in the Official Statement relating to any
Bank and provided by a Bank for inclusion in the Official Statement or summarizing the contents
of documents.
(n) Environmental Matters. The Company conducts in the ordinary course of its
business a review of the effect of existing Environmental Laws on its business, operations and
properties, and as a result thereof has reasonably concluded that such Environmental Laws are
unlikely to have a material adverse effect on the ability of the Company to meet its commitments
hereunder or under any of the Operative Documents.
(0) Insurance. The properties and operations of the Company of a character usually
insured by Persons of established reputation engaged in the same or a similar business, similarly
situated, are adequately insured both as to type of insurance and amount by financially sound and
reputable insurers, and the Company carries with such insurers adequate other insurance
including public liability and product liability insurance, as is usually carried by Persons of
established reputation engaged in the same or a similar business, similarly situated.
(P) Bonds Validlv Issued. The Bonds have been duly authorized, authenticated and
issued and delivered, and are the legal, valid and binding obligations of the applicable Issuer, and
are not in default.
(q)
Taxabilitv.The performance of this Agreement and the transactions contemplated
herein will not affect the status of the interest on the Bonds as exempt from Federal income tax.
(r) Title to Real Property. The Company has good and sufficient title to all of the real
property it purports to own, free and clear of Liens other than Liens permitted pursuant to Section
02(d) and other than minor defects and irregularities customarily found in properties of like
size and character that do not materially impair the use of the property affected thereby and the
operation of the business of the Company.
(s) Accuracv of Information. No exhibit, schedule, report or other written
information provided by or on behalf of the Company or its agents to the Administrative Agent
the LlC Issuers or the Banks in connection with the negotiation, execution and closing of this
Agreement (including the Official Statement) knowingly contained when made any material
misstatement of fact or knowingly omitted to state any material fact necessary to make the
statements contained therein not misleading in light of the circumstances under which they were
made.
(t) Solvency. (i) The Company s assets do not constitute unreasonable small capital
to carry out its business as now conducted or as proposed to be conducted; (ii) the Company does
not intend to incur debt beyond its ability to pay such debts as they mature (taking into account
the timing and amounts of cash to be received by it and the amounts to be payable on or in
respect of its obligations); and (iii) the Company does not believe that final judgments against it
in actions for money damages presently pending will be rendered at a time when, or in an amount
such that, it will be unable to satisfy any such judgments promptly in accordance with their terms
(taking into account the maximum reasonable amount of such judgments in any such actions and
the earliest reasonable time at which such judgments might be rendered). The Company s cash
flow and other resources available to the Company, after taking into account all other anticipated
uses of its cash (including the payments on or in respect of debt referred to in clause (ii) above),
will at all times be sufficient to pay all such judgments promptly in accordance with their terms.
ARTICLE V
COVENANTS OF THE COMPANY
SECTION 5.01. Affirmative Covenants.
So long as a drawing is available under the Letters of Credit or any LlC Issuer or the
Banks shall have any Commitment hereunder or the Company shall have any obligation to pay
any amount to the Banks, the LlC Issuers or the Administrative Agent hereunder, the Company
will, unless the Majority Banks shall otherwise consent in writing:
(a)Financial Statements of the Company. Deliver to the Banks:
(i) as soon as available and in any event within 60 days after the end of each
of the first three quarters of each fiscal year of the Company, a consolidated balance sheet
of the Company and its Consolidated Subsidiaries as of the end of such quarter, the
related statement of consolidated income and retained earnings for such quarter and for
the portion of the Company s fiscal year ended at the end of such quarter and the related
statement of cash flows for the portion of the Company s fiscal year ended at the end of
such quarter, setting forth in each case (except for the consolidated balance sheet of the
Company and its Consolidated Subsidiaries as of the end of such quarter) in comparative
fonD the figures for the corresponding quarter and the corresponding portion of the
Company s previous fiscal year, all certified (subject to normal year-end adjustments) as
to fairness of presentation, generally accepted accounting principles and consistency by
an Authorized Officer;
(H) as soon as available and in any event within 120 days after the end of each
fiscal year of the Company, a consolidated balance sheet of the Company and its
Consolidated Subsidiaries as of the end of such fiscal year and the related statements
consolidated income and retained eamings and cash flows for such fiscal year, setting
forth in each case in comparative form the figures for the previous fiscal year, all reported
on in a manner acceptable to the Securities and Exchange Commission by Deloitte &
Touche LLP or other independent public accountants of nationally recognized standing;
(Hi) simultaneously with the delivery of each set of financial statements
referred to in clauses (i) and (ii) above, a certificate of an Authorized Officer (i) setting
forth in detail satisfactory to the Administrative Agent the calculations required to
establish whether the Company was in compliance with the requirements of Section
02(c) and Section 5.02(d)(xi) on the date of such financial statements and (ii) stating
whether any Default exists on the date of such certificate and, if any Default then exists,
setting forth the details thereof and the action which the Company is taking or proposes to
take with respect thereto;
(iv) simultaneously with the delivery of each set of financial statements
referred to in clause (ii) above, a statement of the firm of independent public accountants
which reported on such statements whether anything has come to their attention or cause
them to believe that any Default existed on the date of such statements;
(v) forthwith upon the occurrence of any Default, a certificate of an
Authorized Officer setting forth the details thereof and the action which the Company is
taking or proposes to take with respect thereto;
(vi) promptly upon the mailing thereof to the shareholders of the Company
generally, copies of all financial statements, reports and proxy statements so mailed;
(vii) promptly upon transmission thereof, copies of all such reports which it
files with the Securities and Exchange Commission (or any governmental body or agency
succeeding to the functions of the Securities and Exchange Commission) under the
Securities Exchange Act of 1934, as amended;
(viii) if and when any member of the Controlled Group (i) gives or is required to
give notice to the PBGC of any "reportable event" (as defined in Section 4043 of
ERISA), for which the requirement of notice to the PBGC within 30 days has not been
waived, with respect to any Plan which might constitute grounds for a termination of such
Plan under Title IV of ERISA, or knows that the plan administrator of any Plan has given
or is required to give notice of any such reportable event, a copy of the notice of such
reportable event given or required to be given to the PBGC; (ii) receives notice of
complete or partial withdrawal liability under Title of ERISA in excess of $10 000 000
or notice that any Multiemployer Plan is in reorganization, is insolvent or has been
terminated, which reorganization, insolvency or termination is reasonably expected to
result in a current payment obligation of one or more members of the Controlled Group in
excess of $1 0 000 000, a copy of such notice; (Hi) receives notice from the PBGC under
Title IV of ERISA of an intent to terminate, impose liability (other than for premiums
under Section 4007 of ERISA) in respect of, or appoint a trustee to administer, any Plan
a copy of such notice; (iv) applies for a waiver of the minimum funding standard under
Section 412 of the Code, a copy of such application; (v) gives notice of intent to terminate
any Plan under Section 4041 ( c) of ERISA, a copy of such notice and other information
filed with the PBGC; (vi) gives notice of withdrawal from any Plan pursuant to Section
4063 of ERISA, a copy of such notice; or (vii) fails to make any payment or contribution
to any Plan or Multiemployer Plan, or makes any amendment to any Plan, which has
resulted or would result in the imposition of a Lien or the posting of a bond or other
security, an Officer s Certificate setting forth details as to such occurrence and action, if
any, which the Company or applicable member of the Controlled Group is required or
proposes to take; and
(ix) from time to time such additional information regarding the financial
position or business of the Company as the Administrative Agent, at the request of any
Bank, may reasonably request.
The Banks are hereby authorized to deliver a copy of the financial statements delivered to
pursuant to this Section 5.01 to any regulatory body having jurisdiction over it.
(b) Inspection.Subject to contractual or statutory limitations regarding confidential
or proprietary information, the Company covenants that it will permit, at any reasonable time and
from time to time, the Banks or any agents or representatives thereof to examine and make copies
of and abstracts from the records and books of account of, and visit the properties of, the
Company and discuss the general business affairs of the Company with any of its officers;
provided that the Company reserves the right to restrict access to any of its facilities in
accordance with reasonably adopted procedures relating to safety and security; and provided
further that the costs and expenses incurred by the Banks or its agents or representatives in
connection with any such examinations, copies, abstracts, visits or discussions shall be for the
account of each Bank, unless such costs and expenses were so incurred during the continuance of
a Default or Event of Default in which case they shall be for the account of the Company.
(c) Preservation of Corporate Existence. Etc.The Company covenants that it will
preserve and maintain its corporate existence, rights, franchises and privileges in the jurisdiction
of its incorporation, and qualify and remain qualified as a foreign corporation in each jurisdiction
in which such qualification is required by law to conduct its business.
(d) Compliance with Laws. Etc.The Company will comply in all respects with all
applicable laws, ordinances, rules, regulations and requirements of governmental authorities
(including Environmental Laws and ERISA and the rules and regulations thereunder) except
where the necessity of compliance therewith is contested in good faith by appropriate
proceedings or where non-compliance therewith would not have a material adverse effect on the
ability of the Company to meet its commitments hereunder.
(e) Maintenance ofPropertv: Insurance. The Company covenants that it will keep all
property useful and necessary in its business in good working order and condition, ordinary wear
and tear expected, and that it will maintain insurance with responsible and reputable insurance
companies (or through its own program of self-insurance) in such amounts, with such deductibles
and covering such risks as is usually maintained by companies engaged in similar businesses and
owning similar properties.
(f) Certain Notices.The Company covenants that it will furnish to the
Administrative Agent a copy of any notice, certification, demand or other writing or
communication given by any Issuer to the Company or by the Company to any Issuer under or in
connection with the Bonds or any of the Operative Documents, in each case promptly after the
receipt or giving of the same.
(g)
Maintenance of Trustee. The Company will maintain in place a Trustee in
accordance with the provisions of each Indenture.
(h) Official Statement.The Company will not include, or permit to be included, any
material or reference relating to any Bank in any Official Statement or any tombstone
advertisement, unless such material or reference is approved in writing by such Bank prior to its
inclusion therein; and will not distribute, or permit to be distributed or used, any Official
Statement unless copies of such Official Statement are furnished to such Bank.
(i) Remarketing. The Company will not suffer or permit the Remarketing Agent to
remarket any Bonds at a price less than the principal amount thereof plus accrued interest, if any,
thereon to the respective dates of remarketing. Upon written notice from the Administrative
Agent that any Remarketing Agent is failing to reprice or remarket the applicable Bonds in the
manner contemplated by the applicable Remarketing Agreement (including in the event at any
time no person is serving as Remarketing Agent for any Bonds), the Company will take all
appropriate action available to the Company to remedy such failure.
(j)
Substitute Letter of Credit.The Company will not substitute another letter of
credit for any Letter of Credit unless prior to or simultaneously with such substitution, there shall
be repaid to the Banks in full in cash all amounts owing hereunder with respect to such Letter of
Credit and such Letter of Credit shall be cancelled.
(k) Remarketing Agent.The Company will maintain in place a Remarketing Agent in
respect of each of the Bonds in accordance with the provisions of the applicable Indenture.
Without the prior written approval of the Majority Banks (which approval shall not be
unreasonably withheld), the Company will not appoint or pennit or suffer to be appointed any
successor Remarketing Agent.
(1) Redemption or Defeasance of Bonds.The Company shall use its reasonable best
efforts to cause the applicable Trustee, upon redemption or defeasance of all of the Bonds
pursuant to any Indenture, to surrender the Letter of Credit issued in respect of such Bonds to the
applicable LlC Issuer for cancellation.
(m) Registration of Bonds. The Company shall cause all Bonds which it acquires, or
which it has had acquired for its account, to be registered forthwith in accordance with the
applicable Indenture in the name of the Company or its nominee (the name of any such nominee
to be disclosed to the applicable Trustee and the Administrative Agent).
SECTION 5.02. Negative Covenants.
(a) Amendment of Agreements. The Company covenants that it will not amend
modify or terminate, or agree to amend, modify or tenninate, any Operative Document, except
with the prior written consent of the Majority Banks.
(b) Consolidation: Merger: Sale of Assets. The Company covenants that it will not
sell, lease or otherwise transfer, directly or indirectly, all or substantially all of the assets of the
Company, or consolidate or merge with any other Person unless, immediately thereafter, the
Company shall be the surviving corporation and, after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing.
(c) Total Debt.The Company covenants that at no time will the Total Debt of the
Company exceed 65% of the Total Capitalization of the Company; provided that.for purposes
of the calculation of the foregoing ratio, any non-cash effects resulting from the adoption and
ongoing application of the "Statement of Financial Accounting Standards No. 158: Employers
Accounting for Deferred Pension and other Postretirement Plans, an amendment of F ASB
Statements No. 87, 88, 106 and 132(R)" will be excluded.
(d) Negative Pledge. The Company will not create, assume or suffer to exist any Lien
on any asset now owned or hereafter acquired by it, except:
the Lien of the Pledge Agreements and the Control Agreements;(i)
(ii)the Lien of the Umbrella Mortgage;
(iii) any Lien that qualifies as an "Excepted Encumbrance" under Section 1.
of the Umbrella Mortgage provided that foreclosure of any Liens for taxes, assessments
or other governmental charges so qualifying shall have been effectively stayed;
(iv) any Lien on the Company s interest in facilities securing Debt incurred or
assumed for the purpose of financing all or any part of the cost of acquiring such
facilities provided that the interest on such Debt is exempt from tax under the Code as in
effect when such Debt is incurred or assumed;
(v) any Lien on the Company s interest in Pollution Bonds or cash or cash
equivalents securing (i) the obligation of the Company to reimburse the issuer of a
Pollution LC for a drawing on such Pollution LC for the purpose of purchasing Pollution
Bonds or (ii) the obligation of the Company to reimburse or repay amounts advanced
under any facility entered into to provide liquidity or credit support for any issue of
Pollution Bonds;
(vi) any Lien on any asset securing Debt of the Company incurred or assumed
for the purpose of financing all or any part of the cost of acquiring such asset
provided that such Lien attaches to such asset concurrently with or within 90 days after
the acquisition thereof;
(vii) any Lien on any asset of any corporation existing at the time such
corporation is merged or consolidated with or into the Company and not created in
contemplation of such event;
(viii) any Lien existing on any asset prior to the acquisition thereof by the
Company and not created in contemplation of such acquisition;
(ix) any Lien arising out of the refinancing, extension, renewal or refunding of
any Debt of the Company secured by any Lien permitted by any of the foregoing clauses
(iii) through (viii), inclusive, of this Section, provided that such Debt is not increased and
is not secured by any additional assets;
(x) Liens incidental to the conduct of its business or the ownership of its assets
which (a) do not secure Debt or obligations under Hedging Agreements, (b) do not secure
any single obligation (or series of related obligations) in an amount exceeding
$100 000 000 and (c) do not in the aggregate materially detract from the value of its
assets or materially impair the use thereof in the operation of its business;
(xi) Liens on cash and cash equivalents securing obligations under Hedging
Agreements; provided that the aggregate amount of cash and cash equivalents subject to
Liens permitted by this clause (xi) shall at no time exceed $75 000 000;
(xii) Liens not otherwise permitted by the foregoing clauses of this Section
securing Debt of the Company and Liens not permitted by clause (xi) above on cash and
cash equivalents securing obligations under Hedging Agreements; provided that the sum
of (a) the aggregate principal amount of Debt secured by such Liens and (b) the aggregate
amount of cash and cash equivalents subject to Liens not pennitted by clause (xi) above
securing obligations under Hedging Agreements shall not at any time exceed 7.5% of
Tangible Net Worth;
(xiii) the right of the counterparty to two or more Hedging Agreements with the
Company to close out such Hedging Agreements if applicable margin or other
requirements are not met and apply any proceeds thereof to any resulting balance due;
(xiv) Liens on cash and letters of credit securing obligations under Commodity
Forward Contracts; and
(xv) the right of the counterparty to two or more Commodity Forward
Contracts to close out such Commodity Forward Contracts if applicable margin or other
requirements are not met and apply any proceeds thereof to any resulting balance due.
( e) Guaranties. The Company will not enter into any Guaranty of any Debt or other
obligation of any Subsidiary, except (i) any such Guaranties of Debt or other obligations that (a)
have been approved by appropriate orders from the utility regulatory authorities to which the
Company is at the time subject and (b) pertain solely to Debt or other obligations substantially all
of the net proceeds of which are loaned by such Subsidiary to the Company and (ii) any such
Guaranties of other obligations which Guaranties are not material to the financial position of the
Company either individually or in the aggregate.
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default.
The occurrence of any of the following events shall be an Event of Default' hereunder:
(a) the Company shall fail to pay when due any amount paid by the Administrative
Agent, any LlC Issuer or any Bank under the Letter of Credit or any principal of any Tender
Advance or shall fail to pay, within five days of the due date thereof, any interest or any fees
payable hereunder; or
(b) the Company shall fail to pay any other amount claimed by the Administrative
Agent, any LlC Issuer or any Bank under this Agreement within five days of the due date thereof
unless (i) such claim is disputed in good faith by the Company, (ii) such unpaid claim does not
exceed $100 000, and (iii) the aggregate of all such unpaid claimed amounts does not exceed
$300 000; or
(c) any representation or waITanty made by the Company in Article IV hereof, in any
Pledge Agreement or any Control Agreement or in any certificate, financial or other statement
furnished by the Company pursuant to this Agreement or any Pledge Agreement or any Control
Agreement shall prove to have been incoITect in any material respect when made or deemed
made; or
(d) for any reason (other than release by the Administrative Agent), any Pledge
Agreement or any Control Agreement shall cease to be in full force and effect or any Pledge
Agreement or any Control Agreement shall cease to constitute a first and prior lien on all Bonds
pledged pursuant to such Pledge Agreement or Control Agreement or if the Company shall not
be liable under or any Pledge Agreement or any Control Agreement or shall so assert; or
(e) the Company shall fail to perfonn or observe (i) any of the provisions of Sections
01(c) and 5.02(b) through (t) hereof, or (ii) any other tenD, covenant or agreement contained in
this Agreement, any Pledge Agreement or any Control Agreement and any such failure under this
clause (1i) shall remain unremedied for 15 days after written notice thereof shall have been given
to the Company by the Administrative Agent; or
(t) any material provision of this Agreement, any Pledge Agreement or any Control
Agreement shall at any time for any reason cease to be valid and binding on the Company, or
shall be declared to be null and void, or the validity or enforceability thereof shall be contested
by the Company or any Governmental Authority or the Company shall deny that it has any
further liability or obligation under this Agreement, any Pledge Agreement or any Control
Agreement; or
(g)
the Company shall fail to make any payment in respect of any Material Debt or
Material Hedging Obligations when due or within any applicable grace period; or
(h) any event or condition shall occur which results in the acceleration ofthe maturity
of any Material Debt of the Company or enables the holder or any requisite percentage of the
holders of such Material Debt or any Person acting on such holder s behalf to accelerate the
maturity thereof; or
(i) the Company shall commence a voluntary case or other proceeding seeking
liquidation, reorganization or other relief with respect to itself or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking the appointment of a trustee
receiver, liquidator, custodian or other similar official of it or any substantial part of its property;
or shall consent to any such relief or to the appointment of or taking possession by any such
official in an involuntary case or other proceeding commenced against it, or shall make a general
assignment for the benefit of creditors, or shall fail generally to pay its debts as they become due
or shall take any corporate action to authorize any of the foregoing; or
G) an involuntary case or other proceeding shall be commenced against the Company
seeking liquidation, reorganization or other relief with respect to it or its debts under any
bankruptcy, insolvency, or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, and such involuntary case or other proceeding shall remain
undismissed and unstayed for a period of 60 days; or an order for relief shall be entered against
the Company under the federal bankruptcy laws as now or hereafter in effect; or
(k) the Company or any member of the Controlled Group shall fail to pay when due
an amount or amounts aggregating in excess of $25 000 000 which it shall have become liable to
pay to the PBGC or to a Plan under Title IV of ERISA; or notice of intent to terminate a Material
Plan shall be filed under Title IV of ERISA by any member of the Controlled Group, any plan
administrator or any combination of the foregoing; or the PBGC shall institute proceedings under
Title IV of ERISA to terminate, to impose liability in excess of $25 000,000 (other than for
premiums under Section 4007 of ERISA) in respect of, or to cause a trustee to be appointed to
administer any Material Plan or a proceeding shall be instituted by a fiduciary of any
Multiemployer Plan against any member of the Controlled Group to enforce Section 515 or
42l9(c)(5) of ERISA in respect of an amount or amounts aggregating in excess of $25 000 000
and such proceeding shall not have been dismissed within 30 days thereafter; or a condition shall
exist by reason of which the PBGC would be entitled to obtain a decree adjudicating that any
Material Plan must be terminated; or there shall occur a complete or partial withdrawal from, or a
default, within the meaning of Section 4219(c)(5) of ERISA, with respect to, one or more
Multiemployer Plans which would cause one or more members of the Controlled Group to incur
a current payment obligation in excess of $25 000 000;
(1) a judgment or order for the payment of money in excess of $25 000 000 shall be
rendered against the Company and shall continue unsatisfied and unstayed for a period of 30
days; or
(m) MidAmerican shall fail to own (directly or indirectly through one or more
Subsidiaries) at least 80% of the outstanding shares of common stock of the Company; any
person or group of persons (within the meaning of Section 13 or 14 of the Securities Exchange
Act of 1934, as amended), except Berkshire Hathaway Inc. or any wholly-owned subsidiary
thereof, shall acquire beneficial ownership (within the meaning of Rule 13d-3 promulgated by
the Securities and Exchange Commission under said Act) of 35% or more of the outstanding
shares of common stock of MidAmerican; or, during any period of 14 consecutive calendar
months, individuals who were directors of the Company on the first day of such period and any
new director whose election by the board of directors of the Company or nomination for election
by the Company s shareholders was approved by a vote of at least a majority of the directors then
still in office who either were directors at the beginning of the applicable period or whose
election or nomination for election was previously so approved, shall cease to constitute a
majority of the board of directors of the Company; or
(n)the occurrence of an event of default as defined in any Operative Document.
SECTION 6.02. Upon an Event of Default
If any Event of Default shall have occurred and be continuing, then, and in any such
event, the Administrative Agent may, and upon written instructions from the Majority Banks
shall, (i) by notice to the Company declare all Tender Advances and all interest accrued thereon
and all other amounts due hereunder immediately due and payable and, upon such declaration
the same shall become and be immediately due and payable (provided that, upon the occurrence
of any Event of Default under Sections 6.01(i) and 0), all such amounts shall automatically
become and be immediately due and payable) without diligence, presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Company, (ii) give written notice
to the applicable Trustee as contemplated by clause (e) of Section 9.01 of the applicable
Indenture (or for the Sweetwater Series 1995 Bonds, clause (f) of Section 9.01 ofthe Sweetwater
1995 Indenture), that an Event of Default has occurred, (iii) by notice sent to the Company,
require the immediate deposit of cash collateral in an amount equal to the Letter of Credit
Amount and all unpaid Tender Advances, and the same shall thereupon become and be
immediately due and payable by the Company; provided, however that the Administrative Agent
shall cause such cash collateral to be deposited in a separate account which shall not be debited
to make any payment directly to a beneficiary of a Letter of Credit pursuant to a draw by such
beneficiary under such Letter of Credit, and (iv) pursue all remedies available to it at law, by
contract, at equity or otherwise, including all remedies under the Pledge Agreements and the
Control Agreements. The Company hereby pledges, assigns and grants to the Administrative
Agent, on behalf of and for the ratable benefit of the Banks and any LlC Issuer, a security interest
in all of the Company s right, title and interest in and to all funds which may from time to time be
on deposit in such cash collateral account to secure the prompt and complete payment and
perfonnance of the Company s obligations hereunder (including, without limitation, any and all
Reimbursement Obligations and any other amounts as shall become due and payable by the
Company to the Banks or any LlC Issuer under this Agreement, any Pledge Agreement or any
Control Agreement), and the Administrative Agent may at any time or from time to time after
funds are deposited in the such cash collateral account, apply such funds to the payment of any
such obligations.
ARTICLE VII
THE AGENTS AND THE LIC ISSUERS
SECTION 7.01. Authorization and Action.
Each Bank hereby appoints and authorizes the Administrative Agent to take such action
as Administrative Agent on its behalf and to exercise such powers under this Agreement as are
delegated to the Administrative Agent by the tenDS hereof, together with such powers as are
reasonably incidental thereto. As to any matters not expressly provided for by this Agreement
(including enforcement or collection of the Reimbursement Obligations), the Administrative
Agent shall not be required to exercise any discretion or take any action, but shall be required to
act or to refrain from acting (and shall be fully protected in so acting or refraining from acting)
upon the instructions of the Majority Banks, and such instructions shall be binding upon all
Banks; provided, however that the Administrative Agent shall not be required to take any action
that exposes the Administrative Agent to personal liability or that is contrary to this Agreement
or applicable law. The Administrative Agent agrees to give to each Bank prompt notice of each
notice given to it by the Company, any Trustee or any LlC Issuer pursuant to the terms of this
Agreement.
SECTION 7.02. Administrative Agent's Reliance, Etc.
Neither the Administrative Agent, the LlC Issuers nor any of their directors, officers
agents or employees shall be liable for any action taken or omitted to be taken by it or them
under or in connection with this Agreement or any Operative Document, except for its or their
own gross negligence or willful misconduct as finally determined by a court of competent
jurisdiction. Without limiting the generality of the foregoing, each of the Administrative Agent
and the LlC Issuers: (i) may consult with legal counsel (including counsel for the Company),
independent public accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken in good faith by it in accordance with the advice of such
counsel, accountants or experts; (ii) makes no warranty or representations to any Bank and shall
not be responsible to any Bank for any statements, warranties or representations (whether written
or oral) made in or in connection with this Agreement or any Operative Documents; (iii) shall not
have any duty to ascertain or to inquire as to the performance or observance of any of the terms
covenants or conditions of this Agreement or any Operative Document on the part of the
Company or to inspect the property (including the books and records) of the Company; (iv) shall
not be responsible to any Bank for the due execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement or any Operative Document or any other
instrument or document furnished pursuant hereto or thereto; and (v) shall incur no liability
under or in respect of this Agreement or any Operative Document by acting upon any notice
consent, certificate or other instrument or writing (which may be by telecopier or telegram)
believed by it to be genuine and signed or sent by the proper party or parties. Notwithstanding
any provision to the contrary contained elsewhere in this Agreement or in any other Operative
Document, the Administrative Agent shall have no duties or responsibilities, except those
expressly set forth herein, nor shall the Administrative Agent have or be deemed to have any
fiduciary relationship with any Bank and no implied covenants, functions, responsibilities, duties
obligations or liabilities shall be read into this Agreement or any other Operative Document or
otherwise exist against the Administrative Agent.
SECTION 7.03. Bank Independent Credit Decision.
Each Bank, including any Bank executing and delivering an assignment, confirms and
agrees hereto as follows: (i) neither the Administrative Agent or any LIC Issuer makes any
representation or warranty or assumes any responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or the execution
legality, validity, enforceability, genuineness, sufficiency or value of this Agreement or any other
instrument or document furnished pursuant hereto; (ii) neither the Administrative Agent or any
LlC Issuer makes any representation or warranty or assumes any responsibility with respect to
the financial condition of the Company or the performance or observance by the Company of any
of its obligations under this Agreement or any other instrument or document furnished pursuant
hereto; (iii) each Bank confirms that it and its legal counsel have received a copy of this
Agreement and the Exhibits hereto, together with copies of such other documents and
information as it has deemed appropriate to make its own credit analysis and decision to enter
into this Agreement, and acknowledges that it is satisfied with the form and substance of this
Agreement and the Exhibits hereto; (iv) each Bank will, independently and without reliance upon
the Administrative Agent, any LlC Issuer 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 this Agreement, and will not rely on the Administrative Agent
or any LlC Issuer (x) to check or inquire on its behalf into the adequacy, accuracy or
completeness of any information provided by the Company under or in connection with this
Agreement or the transactions herein contemplated (whether or not such information has been or
is hereafter distributed by the Administrative Agent) or (y) to assess or keep under review on its
behalf the financial condition, creditworthiness, condition, affairs, status or nature of the
Company; (v) each Bank appoints and authorizes the Administrative Agent to take such action as
agent on its behalf and to exercise such powers under this Agreement as are delegated to such
Administrative Agent by the terms hereof, together with such powers as are reasonably incidental
thereto; and (vi) each Bank agrees that it will perform in accordance with their terms all of the
obligations which by the terms of this Agreement are required to be performed by it as a Bank.
SECTION 7.04. Indemnification.
The Banks agree to indemnify the Administrative Agent and the LlC Issuers (to the extent
not reimbursed by the Company), ratably according to their respective Shares determined at the
time such indenmification is sought, from and against any and all liabilities, obligations, losses
damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever that may be imposed on, incurred by, or asserted against the Administrative
Agent or any LlC Issuer in their respective capacities as such in any way relating to or arising out
of this Agreement or any action taken or omitted by the Administrative Agent or any LlC Issuer
under this Agreement or the Operative Documents; provided that no Bank shall be liable for any
portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the Administrative Agent's or the LlC Issuers' gross
negligence or willful misconduct as finally determined by a court of competent jurisdiction.
Without limitation of the foregoing, each Bank agrees to reimburse the Administrative Agent and
the LlC Issuers promptly upon demand for its ratable share (determined at the time such
unreimbursed expenses are sought) of any out of pocket expenses (including reasonable counsel
fees) incurred by the Administrative Agent or any LlC Issuer in connection with the
administration, modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under this
Agreement, to the extent that the Administrative Agent or any LlC Issuer is not reimbursed for
such expenses by the Company. This provision shall survive the termination of this Agreement.
SECTION 7.05. Barclays and Affiliates.
With respect to its Share and the Reimbursement Obligations held by it, Barclays shall
have the same rights and powers under this Agreement as any other Bank and may exercise the
same as though it were not the Administrative Agent; and the term "Bank" or "Banks" shall
unless otherwise expressly indicated, include Barc1ays in its individual capacity. Barc1ays and its
affiliates may accept deposits from, lend money to, act as trustee under indentures of, and
generally engage in any kind of business with, the Company, any of its Subsidiaries and any
Person who may do business with the Company or any of its Subsidiaries, all as if Barclays were
not the Administrative Agent and without any duty to account therefor to the Banks.
SECTION 7.06. Successor Administrative Agent.
The Administrative Agent may resign at any time by giving written notice thereof to the
Banks and the Company and may be removed at any time with cause by the Majority Banks.
Upon any such resignation or removal, the Majority Banks shall have the right to appoint a
successor Administrative Agent subject to the approval of the Company (not to be unreasonably
withheld). If no successor Administrative Agent shall have been so appointed by the Majority
Banks, and shall have accepted such appointment, within 30 days after the retiring
Administrative Agent's giving notice of resignation or the Majority Banks removal of the retiring
Administrative Agent, then the retiring Administrative Agent after consultation with the
Company may, on behalf of the Banks, appoint a successor Administrative Agent, which shall be
a commercial bank organized or licensed under the laws of the United States of America or
any State thereof and having a combined capital and surplus of at least $50,000 000.00. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations under this Agreement.
After any retiring Administrative Agent's resignation or removal hereunder as Administrative
Agent, the provisions of this Article VII shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Administrative Agent under this Agreement.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc.
No amendment or waiver of any provision of this Agreement, nor consent to any
departure by the Company therefrom, shall in any event be effective unless the same shall be in
writing and signed by the LlC Issuers, the Administrative Agent, the Majority Banks and the
Company, and then such waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given; provided, however that no amendment, waiver or consent
shall, unless in writing and signed by all the Banks, do any of the following: (a) waive any of the
conditions specified in Section 3., (b) increase the amount of the Commitment, extend the
Stated Termination Date then in effect or subject any Banks to any additional obligations, (c)
reduce the principal of, or interest on, the Reimbursement Obligations or any fees or other
amounts payable hereunder (except fees payable for the account of the LlC Issuers or
Administrative Agent), (d) postpone any date fixed for any payment of principal of, or interest
, the Reimbursement Obligations or any fees or other amounts payable hereunder (except fees
payable for the account of the LlC Issuers or Administrative Agent), (e) change the percentage of
the Reimbursement Obligations or of the Shares or the number of Banks that shall be required for
the Banks or any of them to take any action hereunder, (f) alter the ratable application of
payments or prepayments of principal, interest or other amounts hereunder among the Banks
, (g)
release any of the Pledged Bonds except upon reimbursement for the drawings related to such
Pledged Bonds or as otherwise provided in this Agreement or any of the Pledge Agreements or
(h) amend, waive, supplement or otherwise modify this Section 8., Section 8.04(b) or Section
04(c); provided, further that no amendment, waiver or consent shall, unless in writing and
signed by the Administrative Agent or the LlC Issuers, in addition to the Banks required above to
take such action, affect the rights or duties of the Administrative Agent or the LlC Issuers
respectively, under this Agreement.
SECTION 8.02. Notices, Etc.
All notices and other communications provided for hereunder shall be in writing
(including telecopy notice) and mailed, sent, telecopied or delivered, if to the Company, to its
street address at 825 N.E. Multnomah S1., Portland, Oregon 97232, and, in the case of telecopy,
to telecopy no. [phone] , in each case to Attention: Treasurer; if to the Administrative
Agent or to Barclays, as an LlC Issuer, in the case of deliveries or mailings, to its address at 200
Park Avenue, New York, New York 10166 and, in case oftelecopy, to telecopy no. (212) 412-
6709, in each case to Attention: Sydney G. Dennis, Power and Utilities Group, with a copy to
Attention: May Huang, Bank Debt Management, at 200 Park Avenue, New York, New York
10166, and, in case oftelecopy, to telecopy no. [phone]; if to BNP, as an LlC Issuer, in
the case of deliveries or mailings, to its address at 787 Seventh Avenue, New York, New York
10019 and, in case oftelecopy, to telecopy no. [phone], in each case to Attention: Denis
P. O'Meara, Power and Utilities Group, with a copy to Attention: Bill Davidson, Loan Portfolio
Management , at 787 Seventh Avenue, New York, New York 10019, and, in case oftelecopy, to
telecopy no. [phone]; and if to any other Bank, at its address specified on Schedule I
hereto or to the address designated by such Bank in the assignment agreement executed by such
Bank pursuant to Section 2.14(a); or as to each party, at such other address as shall be designated
by such party in a written notice to the other parties. All such notices and communications shall
be effective when mailed or sent, addressed as aforesaid, except that notices to any LlC Issuer or
the Administrative Agent pursuant to the provisions of Article II shall not be effective until
received by such LlC Issuer or the Administrative Agent, as appropriate.
SECTION 8.03. No Waiver; Remedies.
No failure on the part of any Bank or the Administrative Agent to exercise, and no delay
in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right hereunder preclude any other or further exercise thereof or the exercise of
any other right. The remedies herein provided are cumulative and not exclusive of any remedies
provided by law.
SECTION 8.04. Right of Set-off; Sharing of Payments.
(a) In addition to any rights now or hereafter granted under applicable law and not by
way of limitation of any such rights, during the continuance of any Event of Default, each Bank
is hereby authorized at any time and from time to time, without notice to the Company or to any
other person or entity, any such notice being hereby expressly waived, to set-off and to
appropriate and apply any and all deposits (general or special) and any other indebtedness at any
time held or owing by such Bank to or for the credit or the account of the Company against and
on account of the obligations and liabilities of the Company to such Bank under this Agreement
and any Letter of Credit, including all claims of any nature or description arising out of or
connected with this Agreement and/or the Letters of Credit, irrespective of whether or not such
Bank shall have made any demand hereunder and although such obligations may be contingent
or unmatured.
(b) Each Bank agrees promptly to notify the Company after any such set-off and
application referred to in subsection (a) above, provided that the failure to give such notice shall
not affect the validity of such set-off and application. The rights of the Banks under this Section
are in addition to other rights and remedies (including other rights of set-off) that the Banks may
have.
(c) If any Bank shall obtain any payment (whether voluntary, involuntary, through the
exercise of any right of set-off, or otherwise, but excluding all proceeds received by assignments
or sales of participations in accordance with Section 2.14) on account of the Reimbursement
Obligations in excess of its ratable share of payments on account of such Reimbursement
Obligations obtained by all the Banks, such Bank shall forthwith purchase from the other Banks
a participation in the portions of such Reimbursement Obligations owing to them as shall be
necessary to cause such purchasing Bank to share the excess payment ratably with each of them;
provided, however that if all or any portion of such excess payment is thereafter recovered from
such purchasing Bank, such purchases shall be rescinded and the other Banks shall repay to the
purchasing Bank the purchase price to the extent of such recovery together in each case with an
amount equal to such Bank's ratable share (according to the proportion of (i) the amount of the
such Bank's required repayment to (ii) the total amount so recovered from the purchasing Bank)
of any interest or other amount paid or payable by the purchasing Bank in respect of the total
amount so recovered.
(d) Notwithstanding the foregoing, if any Bank shall obtain any such excess payment
involuntarily, such Bank may, in lieu of purchasing participations from the other Banks in
accordance with subsection ( c) above, on the date of receipt of such excess payment, return such
excess payment to the Administrative Agent for distribution in accordance with Section 2.09.
SECTION 8.05. Indemnification.
The Company hereby indemnifies and holds the Administrative Agent, each LlC Issuer
each Bank and their respective officers, directors, employees and affiliates harmless from and
against any and all claims, damages, losses, liabilities, costs or expenses that the Administrative
Agent, such LlC Issuer or such Bank, as the case may be, may incur or which may be claimed
against the Administrative Agent, any LlC Issuer or any Bank by any person or entity:
(a) By reason of or in connection with the initial offering and sale ofthe Bonds or the
subsequent remarketing and transfer from time to time of the Bonds provided, however that, in
the case of any action or proceeding alleging an inaccuracy in a material respect, or an untrue
statement, with respect to information supplied by and describing the LlC Issuer in Appendix B
to the Official Statement for the Bonds in any Supplement to Official Statement (the Bank
Information
),
or an omission to state therein a material fact necessary to make the statements in
the Bank Information, in the light of the circumstances under which they were made, not
misleading, (i) indemnification by the Company pursuant to this Section 8.05(a) shall be limited
to the costs and expenses of the Administrative Agent, each LlC Issuer or each Bank (including
fees and expenses of such party's counsel) of defending such allegation, (ii) if in any such action
or proceeding it is finally determined that the Bank Information contained an inaccuracy ina
material respect or an untrue statement of a material fact or omitted to state therein a material fact
necessary to make the statements contained therein, in the light of the circumstances under which
they were made, not misleading, then the Company shall not be required to indemnify the
Administrative Agent, each LlC Issuer or each Bank pursuant to this Section 8.05(a) for any
claims, damages, losses, liabilities, costs or expenses to the extent caused by such inaccuracy or
untrue statement or omission, and (iii) if any such action or proceeding shall be settled by the
Administrative Agent, such LlC Issuer or such Bank without there being a final determination to
the effect described in the preceding clause (ii), then the Company shall be required to indemnify
the Administrative Agent, such LlC Issuer or such Bank pursuant to this Section 8.05(a) only if
such action or proceeding is settled with the Company s consent; or
(b) By reason of or in connection with the execution, delivery or performance of this
Agreement or any Operative Document or any transaction contemplated by this Agreement or
any Operative Document; or
(c) By reason of or in connection with the execution and delivery or transfer of, or
payment or failure to make payment under, the Letters of Credit; provided, however, that the
Company shall not be required to indemnify any LlC Issuer pursuant to this Section 8.05(c) for
any claims, damages, losses, liabilities, costs or expenses to the extent caused by (i) such LlC
Issuer s willful misconduct or gross negligence, as finally determined by a court of competent
jurisdiction, in determining whether documents presented under a Letter of Credit comply with
the terms of such Letter of Credit or (ii) such LlC Issuer s willful failure to make lawful payment
under a Letter of Credit after the presentation to it by the applicable Trustee or a successor trustee
of a draft and certificate strictly complying with the terms and conditions of such Letter of
Credit.
The Company also agrees not to assert any claim against the Administrative Agent, any
LlC Issuer, any Bank or any of their Affiliates, or any of their respective officers, directors
employees, attorneys and agents, on any theory of liability, for special, indirect, consequential or
punitive damages arising out of or relating to the actual or proposed use of the proceeds of any
Letter of Credit, any Operative Document, or any of the transactions contemplated thereby.
Nothing in this Section 8.05 is intended to limit the Company s obligations contained in Article
II. Without prejudice to the survival of any other obligation of the Company hereunder, the
indemnities and obligations of the Company contained in this Section 8.05 shall survive the
payment in full of amounts payable pursuant to Article II and the termination of the Letters of
Credit.
SECTION 8.06. Liability of the Banks.
Unless expressly set forth to the contrary herein, the Company assumes all risks of the
acts or omissions of each Trustee and any other beneficiary or transferee of the Letters of Credit
with respect to its use of the Letters of Credit. Neither the LlC Issuers, the Banks nor any of their
officers or directors shall be liable or responsible for: (a) the use that may be made of the Letters
of Credit or any acts or omissions of any Trustee and any other beneficiary or transferee in
connection therewith; (b) the validity, sufficiency or genuineness of documents, or of any
endorsement thereon, even if such documents should prove to be in any or all respects invalid
insufficient, fraudulent or forged; (c) payment by any LlC Issuer against presentation of
documents that do not comply with the terms of a Letter of Credit, including failure of any
documents to bear any reference or adequate reference to such Letter of Credit; or (d) any other
circumstances whatsoever in making or failing to make payment, under the Letter of Credit
except that the Company shall have a claim against an LlC Issuer, and such LlC Issuer shall be
liable to the Company, to the extent of any direct, as opposed to consequential, damages suffered
by the Company that the Company proves were caused by (i) such LlC Issuer s gross negligence
or willful misconduct, as finally determined by a court of competent jurisdiction, in determining
whether documents presented under a Letter of Credit comply with the terms of such Letter of
Credit or (ii) such LlC Issuer s willful failure to make lawful payment under a Letter of Credit
after the presentation to it by the applicable Trustee or a successor trustee of a draft and
certificate strictly complying with the tenns and conditions of a Letter of Credit. In furtherance
and not in limitation of the foregoing, the LlC Issuers may accept documents that appear on their
face to be in order, without responsibility for further investigation, regardless of any notice or
infonnation to the contrary.
SECTION 8.07. Costs and Expenses.
The Company agrees to pay on demand all costs and expenses in connection with the
execution, delivery, filing, recording, administration and amendment of this Agreement and any
other documents that may be delivered in connection with this Agreement or the transactions
contemplated hereby, including reasonable fees and out-of-pocket expenses of counsel for the
Administrative Agent and the LlC Issuers and with respect to advising the Administrative Agent
and the LlC Issuers as to its rights and responsibilities under this Agreement and all costs and
expenses including reasonable counsel fees and expenses of the Administrative Agent and the
LlC Issuers in connection with (i) the enforcement of this Agreement, the Operative Documents
and such other documents that may be delivered in connection herewith or therewith (and, in the
event of a Default or Event of Default, all such costs and expenses of the other Banks) or (ii) any
action or proceeding relating to a court order, injunction, or other process or decree restraining or
seeking to restrain any LlC Issuer from paying any amount under a Letter of Credit. In addition
the Company shall pay any and all stamp and, except as othelWise provided in Section 2.
other similar taxes and fees payable or determined to be payable in connection with the
execution, delivery, filing and recording of this Agreement, the Operative Documents or the
Letters of Credit or any such other documents, and agrees to save the Administrative Agent, each
Bank and each LlC Issuer hannless from and against any and all liabilities with respect to or
resulting from any delay in paying or omission to pay such taxes and fees.
SECTION 8.08. Binding Effect; Entire Agreement.
This Agreement shall become effective when it shall have been executed by the
Company, the Banks, the Administrative Agent and the LlC Issuers and thereafter shall be
binding upon and inure to the benefit of each of them and their respective successors and assigns
except that the Company shall not have the right to assign its rights hereunder or any interest
herein without the prior written consent of the Banks.
SECTION 8.09. Confidentiality.
The Administrative Agent and each Bank agrees to exercise all reasonable efforts to keep
any proprietary or financial information delivered or made available by the Company to it
confidential from anyone other than (x) the officers, directors and employees of the
Administrative Agent or any Bank who have a need to know such information in accordance
with customary banking practices and (y) agents of, or persons retained by, the Administrative
Agent or any Bank who are or are expected to become engaged. in. evaluating, approving,
structuring or administering any Letter of Credit, and who, in the case of (x) and (y), receive such
infonnation having been made aware of the restrictions set forth in this Section; provided that
nothing herein shall prevent the Administrative Agent or any Bank from disclosing such
infonnation (i) upon the order of any court or administrative agency or otherwise pursuant to
subpoena or similar procedure in accordance with law, (ii) upon the request or demand of any
regulatory agency or authority having jurisdiction over the Administrative Agent or any Bank or
any self-regulatory body having or claiming authority to regulate or oversee any aspect of the
Administrative Agent's , any LlC Issuer s or any Bank's business or that of any of its Affiliates
(iii) which has been publicly disclosed, (iv) to the extent reasonably required in connection with
any litigation to which the Administrative Agent or any Bank may be a party, (v) to the
Administrative Agent's or any Bank's legal counsel and independent auditors, (vi) to any actual
or proposed Participant which has agreed in writing to be bound by the provisions of this Section
, (vii) any Person to (or through) whom any Bank assigns or transfers (or may potentially
assign or transfer) all or any of its rights and obligations under this Agreement and to any Person
with (or through) whom any Bank enters into (or may potentially enter into) any sub-
participation, any hedge agreement, any securitization or other agreement in relation to, or any
transaction under which payments are to be made by reference to, this Agreement, (viii) in
connection with the exercise of any remedy hereunder or (ix) with the prior written consent of
the Company. The Administrative Agent and each Bank shall attempt in good faith, to the extent
permitted by applicable law, (i) to notify the Company of any disclosure of such infonnation
referred to in clause (i) of the preceding sentence and (ii) upon a reasonable and timely request
by the Company, apply (at the Company s expense) for an appropriate protective order to
preserve the confidentiality of such infonnation or limit the disclosure thereof.
SECTION 8.10. Severability.
Any provision of this Agreement which is prohibited, unenforceable or not authorized in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition
unenforceability or non-authorization without invalidating the remaining provisions hereof or
affecting the validity, enforceability or legality of such provision in any other jurisdiction.
SECTION 11. GOVERNING LAw.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH, THE LA WS OF THE STATE OF NEW YORK.
SECTION 12. Waiver of Jury Trial
Each of the Company, the Administrative Agent, the LIC Issuers and the Banks
hereby irrevocably waives all right to trial by jury in any action, proceeding or
counterclaim arising out of or relating to this Agreement, any of the Operative Documents
or the transactions contemplated hereby or thereby.
SECTION 13. Consent to Jurisdiction.
(a) THE COMPANY IRREVOCABLY (i) AGREES THAT ANY SUIT, ACTION OR
OTHER LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT, ANY PLEDGE AGREEMENT, ANY CONTROL AGREEMENT OR THE
OTHER OPERATIVE DOCUMENTS MA Y BE BROUGHT IN A COURT OF RECORD IN
THE COUNTY OF NEW YORK IN THE STATE OF NEW YORK OR IN THE COURTS OF
THE UNITED STATES OF AMERICA LOCATED IN SUCH STATE, (ii) CONSENTS TO .
THE JURISDICTION OF EACH SUCH COURT IN ANY SUCH SUIT ACTION OR
PROCEEDING AND (iii) WAIVES ANY OBJECTION WHICH IT MAY HA VB TO THE
LAYING OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING IN ANY OF SUCH
COURTS AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM. THE COMPANY AGREES THAT
FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE
AND MA Y BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT
OR IN ANY OTHER MANNER PROVIDED BY LAW.
(b) TO THE EXTENT THAT THE ADMINISTRATIVE AGENT, ANY LlC ISSUER
ANY BANK OR THE COMPANY HAS OR HEREAFTER MAY ACQUIRE ANY
IMMUNITY FROM JURISDICTION OF ANY COURT OF FROM ANY LEGAL PROCESS
(WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF
OR ITS PROPERTY, SUCH PERSON HEREBY IRREVOCABLY WAIVES SUCH
IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT, THE
LEITERS OF CREDIT AND THE OTHER OPERATIVE DOCUMENTS.
(c) Nothing in this Section 8.13 shall affect the right of the Administrative Agent or any
Bank to bring any suit, action or proceeding against the Company or its property in the courts of
any other jurisdiction.
SECTION 14. Headings.
Section headings in this Agreement are included herein for convenience of reference only
and shall not constitute a part of this Agreement for any other purpose.
SECTION 15. Execution in Counterparts.
This Agreement may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same agreement. One or
more counterparts of this Agreement may be delivered via telecopier with the intention that they
shall have the same effect as an original executed counterpart hereof.
SECTION 16. Prior Agreements Superceded.
This Agreement, the Letters of Credit, the Pledge Agreements and the Fee Letters
together represent the final and complete agreement of the parties hereto with respect to the
subject matter hereof, and except as otherwise expressly stated, supersede all prior or
contemporaneous agreements and understandings of such persons, written or oral, relating to the
subject matter hereof.
SECTION 17. Patriot Act.
Each Bank hereby notifies the Company that pursuant to the requirements of the USA
Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the "Act"), it is
required to obtain, verify and record infonnation that identifies each borrower, guarantor or
grantor (the "Loan Parties ), which information includes the name and address of each Loan
Party and other infonnation that will allow such Bank to identify such Loan Party in accordance
with the Act.
SECTION 18. No Novation. It is the express intent of the parties hereto that this
Agreement (i) shall re-evidence the Company s indebtedness under the Existing Reimbursement
Agreement, (ii) is entered into in substitution for, and not in payment of, the obligations of the
Company under the Existing Reimbursement Agreement, and (iii) is in no way intended to
constitute a novation of any ofthe Company s indebtedness which was evidenced by the Existing
Reimbursement Agreement.
(Signature Pages to Follow J
05/22/2~a7 15: 18 5838135673 PACIFlCORP PAGE e2/20
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered by their re~pective officers thereunto duly authorized as of the date firstwritten above.
PACIFICORP
Name: Bruce N. Williams
Title: Vice President and Treasurer
FederaJ Tax Identification Number:
93-0246090
Signilture Page 10
Second Amended and Restated
Lener of Credit and Reimb\ll1iemenl Agreement
BARCLA. YS BANK PLC, as Administrative Agent,
Co-Syndication Agent, a LlC Issuer and as a Bank
By $. *1~~./
Name: ry B. Wenslow
Title: Associate Director
Signature Page 10
Second Amc.ndcd and Restated
tetter of Credit and Rcimburseol11cnt Agreement
MAY-23-2007 14: 12 BNP/PAR I BAS
BNP PARIBAS, NEW YORK BRANCH, as Co-
Syndic ion Agent, a UC Issuer and as a Bank
N~e: DENIS O'MEARA
Tto
:-
Mamging D
By ~6
Name:
Title:
FRANCIS J. DELANEY
Managing Olrector
Siguature Page to
Second Amended and Restated
Letter of Credit and Reimbursemont Agr8emlln1
TOT~ -P. 02
M~Y 23 2007 16: 55 FR BANK OF NOVA SCOT I A TO e 13 128537036 P .
THE BANK OF OVA SCOTIAt as Co-Documentatio gent and as II Bank
ame: Thane Rattew
Title: Managing Director
Signature Page to
Second Amended and Restated
Letter of Credit IIlld Reimbursement Agreement
** TOTAL PAGE. 02 **
THE BANK OF TOKYO-MITSUBISHI UFJ,
LTD., as Co-Documentation Agent and as a Bank
By
Name: Brad ord Jo ce
Title: Authorized Signatory
Signature Page to
Second Amended and Restated
Letter of Credit and Reimbursement Agreement
THE ROYAL BANK OF SCOTLAND FtC, as Co-
Documentation Agent and as a Bank
C;,:.
' ::=::-
f-€-c-.i.Y---.
Name mily Freedman
Title: Vice President
SignatUJ'c Page to
Second l\mcndcd and Restatt:d
Leiter ofCrcdil and Reimnurscment Agreement
OS/22/2007 11: 13 FAX [phone] BLB NEW YORK CCS IaJOO2
BA YERISCHE LANDESBANK, NEW YORK
BRANCH, as a Bank
Title:
Signature Page to
Second Amended and Restated
Letter of Credit and Reimbursement Agreement
OS/22/07 12: 16466882059 13128537036 i'g 001
(;ITmA...\I~ NA. as a Barik
",,
7 '
- -::-'-
By
::::: ~/~~:-~~~?--
Name: Todd .J)~vjs
Title:. Director
)-gnatu.rc Pagl~ 10
$1';~l)nd ,~Ol~nd."'.d ~1 R~i~k-
:Lcfu:r ofCrcdil tLnd ~c-jJllbliBcn;cnt Agreement
MAY 23 2007 10: 26 FR DEUTSCHE BANK 212 797 0070 TO 913128537036 P .
DEUTSCHE BANK AG NEW YORK BRANCH,
as a Bank
Name: Rainer Meier
Title: Vice President
Signature Pale to
Second Amended and Restated
Letter of Credit and R.eimbunement Agreemem
** TOT~L PAGE. 02 **
MIZUHO CORPORATE BANK (USA), as a Bank
By
//
Name: Raymond Ventura
Title: Senior Vice President
Signature Page to
Second Amended and Restated
Letter of Credit and Reimbursement Agreement
OS/22/2007 10: 45 FAX [phone] SUNTRUST ~002
SUNTRUST BANK, as a Bank
A .
Namc~:
Title: V.
Signature Page to
Second Amended Bnd RI~tated
J..\:tter of Credil and Reimbursement Agreement
OS/23/2007 10:46 ABN-AMRQ ~ 913128537036 NO .188 0002
ABN AMRO BANK N., as a Bank
Signatul\! Page to
Second Amended and Restated
Letter of Credit and Reitnbw-scmcmt Agreement
Mi=lY-22-2007 08:26 USNB NAT I aNAL ACCTS 51213 275 5428 P .1212/02
S. BANK NATIONAL ASSOCIATION, as a
Bank~:r~Nam. Janjce ~ Thede
Title: Vice President
SignatUre Page 10
Second Amended and Rcstatcd
Letter of Cn:dit and Reimbursement Agreement
TOTAL P. 02
WELLS FARGO BANK, N., as a Bank
By
Li"
Vice President
SignfLtLII1: Page to
Second Amended md Restated
Lener of Credit and Reimbursement Agreement
The undersigned Departing Bank hereby
acknowledges and agrees that. from and after the
Execution Date, it is no longer a party to the
Existing Reimbursement Agreement.
THE NORINCHUKIN BANK, NEW YORK
BRANCH, as a Departing Bank
By
~~~ ~...
..I&I
Name: Kaoru ~ ada
Title: Joint General Manager
Signature Page to
Second Amended and Restated
Letter of Credit and Reimbursement Agreement
The undersigned Departing Bank hereby
acknowledges and agrees that, from and after the
Execution Date, it is no longer a party to the
Existing Reimbursement Agreement.
SUMITOMO MITSUI BANKING
CORPORATION, as a Departing ~an
Name: David A. Buck
Title: Senior Vice President
Signature Page to
Second Amended and Restated
Letter of Credit and Reimbursement Agreemcnt
The undersigned Departing Bank hereby
acknowledges and agrees that, 1rom and utier the
Execution Datc, it is no longer a party to the
Existing Reimbursement Agreement.
COMMERZBANKAG, NEW YORK AND
(iRAND CAYMAN BRANCHES, as a Departing
Bank ~/i
.1
By
/"--.
h~.-
(;, ~
Name: ,1drOW Kj
Title: Vice President
\ .
1- r" "n\'o '
,- (:,\j\)~
. N~;~~,met Berry
Title: Assistant Tre~lsuter
Signature Page to
Second Amended ill1d Restated
Lclicr of Credit and Rcimbursement Agrc.:ment
The undersigned Departing Bank hereby
acknowledges and agrees that, from and after the
Execution Date, it is no longer a party to the
Existing Reimbursement Agreement.
FIRST COMMERCIAL BANK, LOS ANGELES
BRANCH, as a Departing Bank
By
Ten -'
y~
Lao.:...
Name: Larry Jen-Yu I.
Title: SAVP & Deputy General Manager
Signature Page to
Second Ame:nded and Restated
Letter of Credit and Reimbursement AiTeement
SCHEDULE I
SHARES AND ADDRESSES FOR NOTICES
Bank
Barclays Bank PLC
BNP Paribas, New York Branch
The Bank of Nova Scotia
The Bank of Tokyo-Mitsubishi UFJ
Ltd.
The Royal Bank of Scotland pIc
Bayerische Landesbank, New York
Branch
Citibank, N.
Share
5795390%
5795390%
8.4209294%
8.4209294%
8.4209294%
7.5788364%
5788364%
Operations Contact
(See Section 8.02)
(See Section 8.02)
Scotia Capital
One Liberty Plaza, 26th Floor
New York, NY 10006
Attention: Frank Sandler
Telephone: [phone]
Facsimile: 212-255-5480
BTMU Operations Office for the Americas
c/o The Bank ofTokyo-Mitsubishi UFJ
Ltd.
1251 Avenue of the Americas, 12th Floor
New York, NY 10020-1104
Attention: Roland Uy
Telephone: [phone]
Facsimile: 201-521-2304/2305
The Royal Bank of Scotland pIc
101 Park Avenue
New York, New York 10178
Attention: Emily Freedman
Telephone: [phone]
Facsimile: 212-401-3852
Bayerische Landesbank
560 Lexington Avenue
New York, NY 10022
Attention: Patricia Sanchez
Telephone: [phone]
Facsimile: 212-310-9930
Citibank, N.
388 Greenwich Street, 21st Floor
New York, NY 10012
Attention: Scott Hancock
Telephone: [phone]
Facsimile: 646-291-5020
Bank
Deutsche BankAG New York Branch
Mizuho Corporate Bank (USA)
SunTrust Bank
ABN AMRO Bank N.
S. Bank National Association
Share
5788364%
7.5788364%
7.5788364%
8946506%
8946506%
Operations Contact
Deutsche Bank AG New York Branch
60 Wall Street, MS NYC60-4405
New York, NY 10005
Attention: Scott Linthicum
Telephone: [phone]
Facsimile: 212-797-0070
Mizuho Corporate Bank (USA)
1800 Plaza Ten
Jersey City, NJ 07311
Attention: Lan Ying Lau
Telephone: [phone]
Facsimile: 201-626-9941
SunTrust Bank
303 Peachtree Street, lOth floor
MC-1941
Atlanta, GA 30308
Attention: Lawanda Harris
Telephone: [phone]
Facsimile: 404-588-4401
ABN AMRO Bank N.
540 West Madison St., Suite 2621
Chicago, IL 60661
Attention: Credit Administration:
Facsimile: 312-992-5111
With a copy to:
ABN AMRO Bank N.
4400 Post Oak Parkway, Suite 1500
Houston, TX 77027
Attention: Scott Donaldson
Telephone: [phone]
Facsimile: 832-681-7141
S. Bank National Association
555 S.w. Oak Street, PL-4
Portland, OR 97204
Attention: Janice T. Thede
Telephone: [phone]
Facsimile: 503-275-5428
Bank Share
Wells Fargo Bank, N.8946506%
Operations Contact
Wells Fargo U.S. Corporate Banking
1300 SW 5th Ave, 7th Floor
MAC P6101-076
Portland, OR 97201
Attention: Lisa Larpenteur
Telephone: [phone]
Facsimile: 503-886-2211
EXHIBIT A
Form of Sweetwater Series 1988A Letter of Credit
(Attached.
EXHIBIT B
Form of Sweetwater Series 1988B Letter of Credit
(Attached.
EXHIBIT C
Form of Sweetwater Series 1990A Letter of Credit
(Attached.
EXHIBIT D
Form of Sweetwater Series 1995 Letter of Credit
(Attached.
EXHIBIT E
Form of Emery Series 1991 Letter of Credit
(Attached.
EXHIBIT F
Form of Gillette Series 1988 Letter of Credit
(Attached.
EXHIBIT G
Form of Forsyth Series 1988 Letter of Credit
(Attached.
EXHIBIT H
Form of Second Amendment to Sweetwater Series 1988A Letter of Credit
(Attached.
EXHIBIT I
Form of Second Amendment to Sweetwater Series 1988B Letter of Credit
(Attached.
EXHIBIT J
Form of Second Amendment to Sweetwater Series 1990A Letter of Credit
(Attached.
EXHIBIT K
Form of Second Amendment to Sweetwater Series 1995 Letter of Credit
(Attached.
EXHIBIT L
Form of Second Amendment to Emery Series 1991 Letter of Credit
(Attached.
EXHIBIT M
Form of Second Amendment to Gillette Series 1988 Letter of Credit
(Attached.
EXHIBIT N
Form of Second Amendment to Forsyth Series 1988 Letter of Credit
(Attached.
EXHIBIT 0
Form of Opinion of PacifiCorp General Counsel
(Attached.
EXHIBIT P
Form of Securities Account Control Agreement
(Attached.
EXHIBIT Q
Form of Note
((SECOND) (AMENDED AND RESTATED)) NOTE
(DATE)
PACIFICORP, an Oregon corporation (the Company
),
promises to pay to the order of
(the Bank"the aggregate unpaid principal amount of the indebtedness of the Company
to the Bank resulting from each drawing under a Letter of Credit and from each Advance made
ftom time to time pursuant to the Agreement (as hereinafter defined), in immediately available
funds at the office of Barclays Bank PLC, New York Branch Barclays
),
at 200 Park Avenue
New York, New York, as Administrative Agent, together with interest on the unpaid principal
amount hereof at the rates and on the dates set forth in the Agreement. The Company shall pay
the principal of and accrued and unpaid interest on the indebtedness in full on the Stated
Termination Date.
The Bank may elect to record in accordance with its usual practice the date and amount of
indebtedness and the date and amount of each principal payment hereunder; provided the failure
of the Bank to make any such recordation shall not affect the obligations of the Company
hereunder or under the Agreement.
This ((Second) (Amended and Restated)) Note (the Note is one ofthe Notes issued
pursuant to, and is entitled to the benefits of, the Second Amended and Restated Letter of Credit
and Reimbursement Agreement dated as of May 23, 2007 (which, as it may be amended or
modified and in effect from time to time, is herein called the Agreement
),
among the
Company, Barclays and BNP Paribas, New York Branch, as LlC Issuers and Barclays, as
Administrative Agent, and the financial institutions party thereto, including the Bank, to which
Agreement reference is hereby made for a statement of the terms and conditions goveming this
Note, including the terms and conditions under which this Note may be prepaid or its maturity
date accelerated. Capitalized terms used herein and not otherwise defined herein are used with
the meanings attributed to them in the Agreement.
(This Note re-evidences the indebtedness heretofore evidenced by, and amends and
restates in its entirety, the (Amended and Restated) Note, dated as of , made by the
Company in favor of the Bank in connection with the Existing Reimbursement Agreement (the
Existing Note ). This Note is not in payment or satisfaction of the Existing Note, nor is this
Note in any way intended to constitute a novation of the Existing Note.
This Note shall be governed by the laws of the State of New York.
ACIFICORP
By:
Name:
Title: