20060420Compliance re ring-fencing provisions.pdf

STOEL
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900 SW. Fifth Avenuc, Sulle 2600
Portland, Oregon 97204
phone [phone]
fax 503,220,2480
IVWW.stoe1.com
ATTORNEYS AT LAW
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April 20, 2006
HAND DELIVERED
Ms. Jean D. Jewell
Commission Secretary
Idaho Public Utilities Commission
472 W. Washington
Boise, ill 83702-0074
Re:Case No. PAC-O5-
Joint Application of MidAmerican Energy Holdings Company and PacifiCorp d/b/a
Utah Power & Light Company for an Order Authorizing Proposed Transaction
Dear Ms. Jewell:
Under the tenus of Commitment I 5 in the final Idaho commitments attached to and incorporated
in the Commission s Order No. 29998 issued on March 14, 2006 in this proceeding,
MidAmerican Energy Holdings Company ("MEHC") or PacifiCorp committed to provide a copy
of the final signed agreement for PPW Holdings LLC that contains the ring-fencing provisions
required by Commitment 11 within thirty (30) days after the close of the transaction. MEHe's
acquisition ofPacifiCorp closed on March 21 2006. In compliance with Commitment 15
enclosed is a copy of the final signed agreement for PPW Holdings LLC containing the ring-
fencing provisions required by Commitment 11.
Please contact us if you have any questions. Thank you for your assistance.
Very truly yours
z~~
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J oint Counsel for MidAmerican Energy
Holdings Company and PacifiCorp
cc:Terri Carlock 0 reg ()
Washington
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BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
PPW Holdings, LLC
Limited Liability Company Agreement
EXEClITION COpy
PPW HOLDINGS LLC
" ,, ,
LIMITED LIABiliTY COIY1PANY AGRBE1v1ENT
This Limited Liability Company Agt'~ement (this "i\groomcntll), dated as of
March 15, 2006 between MIDAMERICAN ENERGY HOLDINGS COMPANY (the
Me'mb~r )atldPPW HOLDINGS, LLC,.6 Delaware limited liability Ct5ri'lPMY (the
Company
WITNES$E1'E:
WHEREAS. the :Memb~r bas decidtXlto fo$ a limit~d liability company under
the Limited Liability Company Act of the State of Delaware (ihe '~Act ); and
WHEREAS, the Member desires to ~et forth. among other things. bow the
business, and affairs of the Company shall be managed,
NOW, T1::iE.REFORE, the Member hereby resolves as follows:
Formation and Name.
The l.milersigned does hereby toi':txia lin:1ite4 ligbility company under the Act. The
na11.re of the limited li-ability company is PPW Holdings, LLG. The business of the Company
may be condl1ctedUInder any Qther-name d~.emed nece.~saryQr desirabJeby the Member in order
to comPly witb local law.
The undersignedresotv:e to form and continue the Company as a lhtrited lia:bility
company pursuant to the provisions of the Act and ohbis Agreement and resQlve that its tights
and liabilities shall be as provided in the Act fOrmerllh~rseX:cept as provided t)erein.
Principal Place of Business.
The plincipa1 office of the Company shan be located at 666 Crand A VenlJe, Des
Moines, Iowa 50309, or such other pl~ce asthe: Member may designate frOIIi time to 'lima.
Registered Agent.
Th~nameand address, of the registered agent of the Company fof!Oervice()f
process on th~Comp3ny in the Stat~ of Delaware. shall be do Cotporation SerVice Com~ny,
2711 Centerville Road, Suite 40'0, Wilrrlington, Delaware 19805.
Duration.
The Company shall continue in existence perpetually unles-s the Company is
dissolved and its affairs wound up in accordance with ~he Act or thia Agreement.
W:\Blue-om'J.OQ6\March 200u\Qpeniting Agreement PPW Holdings LtC 031506 B~~ution Copy,POC
)fiscal Year.
The fiscal ye~ ()f the- Company shall be the twelve monthS ended December 31
each year.
Members.
The Menioot' shall con,tinue to be tl1e sole meI'rtber dfth~ Q;ml.pany~ The address
of the Member is as fo110ws: 666 Grand Avetme. Des Moines, Iowa 50309.
Purposes.
(a)the purposes oHh,e, Company are to engage in the fQI1owing activities:1. to purchase and oWn 100% of the capital stock in PacIfiCorp
e'PacifiCorp"; andariy equity intereSt therein, an "'Equity Interest'2. in c.onn~ctipn with the purcha$cof the :EqJ,:Jity In~r~$t. to negotiate,
attthorize? execute; delive,f and perform documents itn.:1tlding, but not limited to, tbat
certain Assignmcnt ftndAssumption of Stock Purchase Agreement between 'the Member
and the (JPn1Pat'iy pUtsu:a.ntto which the M~mber 18m 8$$ign to the Company all of the
Member s rights and ob1igation~ under that cernun Stock Purchase Agreement~ between
the M~rnberandthe Qth~rpersons parties thereto, Q,ated.as.ofMay 23, 2005 and any oth~
agr~emeht or 'document contemphttedthet~b:y (the "Transadion DO(::1lInie.nt$")~ and
2L lode suchothel' thin:gsandd8try onanYO11:her a'ttivities,and only
such things ~dactivlti~s, Whjchth~Board~definedh~ein. det:er:mines to be necessary,
cbnvenientm' incidental to anyofthe foregoingputposes,andto have artde;xerdseal1 of
the power and rights confen-edupon limited liibility companies formed pursuant to the
Act in furtherance of tJ1e foregoing.
(b) The Culrtpany. by ot through one or moreOfficets of the Company, may
enter into and perform the T~ansa:ction IJocmnents'anQ\ all cI.oq.1;ment:s,agreemeJ;its,certificates or
financingstateroents contemplated thereby or relatedtheteto, with such final terms and
proVisions as the Officer or Officers of the Company executing the same shall approve) his 01'
their execution tbetepf to beco1)clusive ev~dei1C~ Qfhis or their !J;pproval , ~ll withol)t any further
act, Vote or approval of the Member, the Board of Directors or any other Officer'notwithstanding
anyotherprovision of this Agreement, the Act or applicable law, rule or regulation. An a,ctions
taken by the Membet, any Director 01 Officer on behalf of the COmpanyot on behalf of any of
its affiliates prior to the date hereotto: effe:ct the tFansactions contemplated bythc Transaction
D()eumenls or the forrnatiop ofthe Company, are beteby ratified, ~pproved and confirmed 1n all
respects. Simultaneously With or following the execllt10n of this Agreement the Company may
enter into each of the TrmwactiollPocuments with-such final terms ap.d prQyisions;:\s the Officer
or Officers of the Company executing the same shall approve. his or their execution th~reof to be
conclusive evidence of his or tl1eir approval.
Managem~nt
(a) BoardQf DireQtors. The bu$iness and affairs .,fthe, Company shall be
managed by ocr under the 'direction of a boafdof onenr more Directors (the "Board~'); provided
that from and after the purchase of an Equity Interest, and, for so long as the Company shall own
an EqllityInterest, one of the members of the Board shall bean Inde,pendent Director.
Ail "IndependmtDirector" shaH mean a member of the Board who is not at the
time of initial appointment, or at any time while $ervingon the Bo.n:rd, and has not been at any
time during the ptec~diilg,'fiV'eG5) y~s: (a) a menibet, stoolcbolder~ director (eXQept assllch
Independent Director of the Company), officer, employee, parmer, attorney or counsel of the
Cornpany otany affiliate of the: Company; (b) a creditor, customerothetthan a consumer.
supplier 'Of other person who has derived in any one of the preceding ($) ca1endm- yem's revenues
from its activities with the Company or any affiliate of the Company (except as such
Indep~rtdent Dir~ctor)i (c) a person related to or emplo:yw by any person described in blause (a)
or clause (b) above, or (d) a trustee,. conservator or receiver for the Company or any affiliate of
the Company. As llsedin this definition
, "
affiliate" shs:lI have the meaning given to such term
under Rule 405 under the Securities Act of 1933-, as amended
Except asothelWise pl'bvidedin tJ;iisSection8(a) with respect to the Independ~mt
Director, the Member by unanimous vote or Qnanitnous written consent. :may determine 'at MY
time in its sole .and ~bsolute dis~reti6n, the number of Directors:to constitute tbe Board. The
initial number of Directors shall be two. At the time of the purchase of an Equity Interest by the
Company, if one of the Directors is not thenaqQalified Indepen.dentDirecfor, the number-of
Directors on the Board sha11 beautomatica11y increased by one, such additional position to be
filled as soon as practicable by an Independent Director selected by a majority vol~ of all of the
Directors then in office. Each Director elected, designated or appointed shall hold office until a
ccessoriselected andqualified or until such Director s earlier death"resignation or removal.
The followingpersOhSal'e the Directors of the Company as ofthe date hereof. Each Director
shall be a "manager" within the meaning of the Act.
Name
Douglas L. Anderson
Patrick J. Goodman
Position
Director
Director
(b) Powers. Subjectto this Section 8, the Board shall have the power to do
any and all acts necessary, convenient or incidental to 01" for tile furtherance of the purposes
described herein, incIuding all powers, statutory C)! otherwise. Exceptas provided in the
certificate and subject to Section 8(i). the Board has the authority to bind the, Company by a
majority of the votes held by the Directors. For pqrposes of voting, each Dite,ctor shan have one
Yote.
(c) Meetings of the Board of Directors. Regular meetings of the Boal.'CL which
shaU be held quarterly, , at least once within each calendar quarter, may be held without
notice atsuc.h time and at such place as shall from time to time bedeterrnined by the Board.
Special meetings of the Board may be caned by lhePresident on not less than one day's notice to
each Dh:~ctorhyteiephone, facsimile~ roail, telegntmt ,or any other means ofcoromunication, and
speOialrnoeting~ shaH be called by the Ptesidentot S~retaty in1ike mnnnerand with like noti~e
upDntJie written request of any on:e or more of the Directors-. Any Director may waive notice of
any meeting PI" the Board in writing and shall be 4~med to have waived notice, of any meeting
of the BiOard which the Director attends orin whi6h the Directorp:articipates.
(d) Qworum;Acts afthe Board, At a11111eetings of the Board, a majority of
thepitectors ,shall constitute a q1JorlIfn forthe 'tratisa~tiQn. of business', and, ex~pt as otherwi~e
provided in any other provisIon of this Agreement or in 'the Certificate, the act' of 'a maj'ority of
the votes held by th~ birectors present at-any meeting at which there is, a quorum sh.all be the act
of the Board. In the case of an act wbicl;1 requires thepnanin1,OlI$' vote of the Ditectol'$ andlor the
~()te of the Independent Director, only the presence. at the subje,ct meeting of all of the Directors.
including the Independent Director. slia11 coJ)stihuea quorum. If a quofQmshall not he present
at any meeting of the Board. the Dlt~tors presei1t at suchmeetirig may adJourn the meeting from
time to time, witholJ,t written notice othex than announcement at the meeting; until a quorum &h&ll
be present.
(e) Action by Unf11jimous Written Coi1;8~nt. Anyactionrequiredorpermitted
to be, taken at any meeting' of the Board may be t~ken with out. a meetiflg if all members of the
BoardcOIisffit theretO in writing,\111d the writing otwritings are filed with the minutes of
proceedings of the Board or committee.
CO Electronic Communications; M~mQers of tbeB,Q,ardmay participate in
meetings of the Board, or any c()mmitteej by means of telephone conference or similar
communications equipment that a1lows all :pers.ons participatfng in tnem~tin~ to h~ar each
other, atld such participation in a.me~ti1'1gshall constitutepres~nce inpetson at the meeting.
(g)
Compensation of Directors; Expewes. The Board shall have the authority
to fix the compensation ofDireetol'$, which shall be notroore than $50 per meeting per Director
fot" aU Directors. The Directorsm:ay be paid their reasonable expenses, if any, of a~wndanceo at
meetings of the Board, which may be a: fixed sum for attendance at each meeting of the Board
and shall in no evem exceed $50 per meeting.
(h) RemovalafDirectors. Unless otherwise re'stribt~d by law, any Dircotorot
the entite Board may be removed, with or without cause, by the Member, and subjectto Section
9, any vacancy caused by !tny such removal may be fil1~d by action of the Memb~r. In the event
of the removal of the Independent Director or other event that causes the Independent Director to
cease to be an Indepe:ndent Director on the B'oard, nq action requiring the vote of the
Independent Dite6tor shalJ take pI ace until such time as a replacement fudepertdent Director is
elected to the Board by the Member.
(i)Limitations on the Company sA(:tiviti~s.1, This Section 8(i) is being adopted in order to qualify the, Company
as a "specian purpose elltity" and so long as the Company holds or owns an Equity
Interest, this, Section8(i)shaIl govern the activities of the Company notwithstanding any
other provision of this Agreement.
2. Splong as,theCompany holds or owns an Equity Interest, the
Board shall cause tlie Company to do or causeto be done all things necessary to preserve
and ke~p in full force and effect its eXistence, rightS (charter,and statUtory) and
fi"anchises. At all times, unless otherwise proviided in the Transaction Documents~ the
Board shall cause the Company to:
maintain its own separate books and records, finan'Ci.al statementS,
and bank accounts;
except fot Ui~ and, accounting purposes, at all times hold itself out
to drt~ public as a legal entity separate from. the Member and any
other Person and notidentify itself as a division ofnny otherPer&on;
have a Board, the composition of which in sum is unique from that
of any other P~rsop;
file its own tax returns, ifany~as may be requited under applicable
law 1 and pay any taxes required to be paid under applicable law;
not commingle its ~sets' with assets of any other Person;
conduct its business in its oWn nam~ md hold all (Jfits asSets hi its
OWn name;
pay its own liabiJitiesonly out of its own funds;
maintain an arm's length relationship with its affiliates, including
its Member;
from its own funds, pay the salaries of its own employeesj
not hold out its credit as being available to satisfy the obligations
of others;
maintain it$: own office and telephone line separate and apart from
its affiliates, although ittnay lease space from an affiliate and share
a phone line with an affiliate, havingeithCir a separate number or
~xtension, and in furLheJ~mce thereof allocate fairly and reasonably
any overhead for shared office space;
use separate stationery~ invoices and checks bearing its own name;
11)
net pledge its assets fDr the benefit of any other Person;
CD1TeCt arty known misundetstanding regarding its separate
identity;
'0)m~ntain ad~quate capital ,and an adequate number 'Of employees in
light of its c'Ontemplated busines$purposes; and
not acquire any obligtitions 'Or securities of the Member or its
affiliates, otherthan the Equity Interest.
Fllih:o:e of the CDmpany tocDrtlply with any of the foregbing cO-Vet'iW1t$ $hal1 not affect the status
of the Company as a separate legal entity or the limited liability 'Of the Member Dr the Directors.3. S'O long as the Company holds 'Or owns 'an Equity Interest and
unless otherwise provided in the Tfansadion DDcuments, the Company shaH nDt:
become or remain liable, directly ofcot1tingentl y" in c 'Onnooti 'On
with any indebtedness 'Or rober liability 'Of any other person Dr
entity, whether by guarantee, endorsement ('Other than
endorsements of neg0tiable instrurnents for dep'Osit 'Or collection in
the 'Ordinal)' course 'Of business), agreement to purchase or
repurchase, agreement to supply 'Or gdvance funds, or otherwise;
grant or permit tocexi'stanylienj,en(mrobrance~ claim, security
interest, pledge or other right in favor oJ any personoret).tjty itl the
assets of the Company or any interest, (whether le;gal i beneficial or
otherwise) in,~ny thereof;
engage, directly or indirectly, in any business otherthan as
p\m1littcd to be performed, undt:r Section 7 here'Of;
make 'Or permit to remain outstanding any loan 'Or advanceto, or
oWn or acquire (a) indebtedness issued by any Qther person or
entity, or (b) any stock or securities of or interest in. any persbnor
entity, other than the Equity Interest~
enter into, or be a party to, any transaction with any of its affiHates
except (A) in the ordinary course of business. (B) pursuant to the
reasonable requirem~nts and purposes of its business and (C) upon
fair and reasonable terms (andj t'Othe ex.tentmaterial , pursuant t'O
written agreements)) that are cOnSiS~111 with markenerrns of any
such tta1lsactions entered into by unaffiliated parties~
make any change to its name o!principal business or use of any
trade milnes, fictitious,names, assumed names or "doing business
as" names.4. So long as the Company holds Or Qwns an Equity Interest, none of
the Company, the Member or the Board shall be authorized or empowered, flat shall they
pennit the Company, withbutthe prior unanimous written consent of an of the Directors
on the Board, including the Independent Director, (a.) to consolidate, merge, dissolve
liquidate Ot sell all Or substantially all of the Company s assets or(b) to institute
proceedings to,have the: Company adjudicated bankrupt or ins:olv~nt,Qr consenUa:the ,
institutioil ofbarikrqptcy of irtsolYen~y proceedings agamstthe Company or file a
volootaty petition seeking, or consent to; reorganization or reIief'withrespectto the
Company under any applicable federal or state law relating ro barrkruptcy, of consent to
appointment of a receiver" liquidator, assignee, trustee, sequeStrator (or other similar
offi~ial) of the Company ora:substnntialpart of it~ property, or make any assignment for
the benefit of cteditotsofthe Company! or admit in writing the CQmpany sinabilityto
pay its debts generalIy as.they become due, or to the fulmstextent permitted by law, to
take any action in fuMerance of any such action. Moreover, the Board may npt vote on,
or al1thorize thetakin~of anY' of the foregoing actions unIeSs'there is at least one
Independ~nt :Qireclor then servingin ~uch capacity.
(j)
Liinitiitio'f1,'S on Distributions. So lo)1g as the Company OWns or holds
Equity Int~test, the Company snaIl notpemritPacifiCorp to declare or make any
Distribution to the Company or any other person. that owns or holds-anEquity Interest
unless, on the date of such Distribution, either.1. at the time and asa result of such Distribution, PaCifiCorp'
Leverage Ratio does not exceed 0.65: 1 and PacifiCorp' s Interest Coverage R~tio is not
Jess than 2.5:1; or2. (ifPacifiCorp is not in compliance with the foregoing: ratios) at
such time, PaoifiCorp sseniQfuttsecured long term debtra;1ing isatleastBBB (or its then
equivaleIit) with Standard & Poor s Ratings Group and Baa2 (orits then equivalent) with
Moody s Iiwestors Service, Inc.
Forpurposesofthis Section 8(1), the following terms shall be defined as follows;:
Capitalized Lease Obligations'. mefinS all lease dbligatioliS of PacifiCorp and
its Subsidiati~s which, under GAAP, are or will be required to be capitalized,ineach
case taken at the amounl'thereof acc()unted for as indebtedness in conformity withBuoh
pdnciples.
ConsoUdated Current Liabilities" means the consoHdatedcurrent liabilities of
PacifiCbrp and its Subsidiaries; but excluding the current portion of long tenn
Indebtedness which woLtld otherwise be included therein, as determined on a
consolidated basis in accordance with GAAP.
Consolidated Debt" meting; atati.y timej the sum of the aggregate outstanding
principal amount of alllndebtedness for Borrowed Money (including; without limitation,
the principal comptmerft of Capitalized Lease Obligations, but.exc1uding Currency,
Interest Rate or Commodity Agreements and all Consolidated CUrrent Liabilities) of
PacifiCOlp, and its Subsidiaries, as determined on a consolidated basis in conformity with
GAAP.
Consolidated EBITDA" means. for any period, the sum of the amounts for such
peliod of PacifiCO1p S (1) ConsolicIa.ted Net Operating Income, (it) Consolidated Interest
Expense, (iii) income taxes and deferred taxes- (other than incofn,e taxes (either positive of'
negative)attributa.ble to ~xtraordinary and non"'re~urring gains. Of losses or sales of
assets), (iv) depteciatiot1 expense, (v) amortization expens~~and (vi) all QthernQn~ca$h
items reducin:g Con:solidated Net Operating Incomej Jess all non-cash items increaSing
ConsoUdatedNet Operating Income, all as de~i1ed on, a consqIidated basis in
conformity with GAAP; provided,tthat lathe extetitPacinCoI'p has any SubSidiary that
not a whollyowned Subsidiary" Consolidated' EBITDA shall he reduced by an amount
equal to the Consolidated Net Operating IncOnieof such SubSidiary mnItiplied by the
quotient of. (AI the number of shares of outstanding common stock: of Buch Subsidiary not
owned on the last day of such pepodby PacifiCorp or any Subsidiary ofPacifiCorp
divided by (B) the total number of shares of outstanding COn1i1'1ortstook of such
Subsidiary on the last day of such period.
Consolidutcd Interest E1q)~nS0" me:ana, for any period, the aggregatearn-ount
of intetestin respect of Indebtedness fot B oITowed Money (including amortization of
original issue discount on any Indebtedness and the in:Wt'est portion on any deferred
paym~nt obligation, calculated in a'ccordancewith the effective interest method of
accounting; and all commissions. discounts and. other fees anctcharges owed with respect
to bankers' acceptance financing) and the net costs associated with Interest Rate
Agreements and aU btlt theprincipa1 component of tental$ in respect of Capitalized Lease
Obligations. paid, accrued or scheduled to he paid or to h,e accruedbyPacifiCorp
eabh of it!; Subsidiarie,~ during sHeh period; excluding; h()Weve1" RT)Y amOU;rit of stIch
in.terestofany Subsidiary of PacifiCorp if the net operating income (or loss) of such
SubsidiatyiRexcluded from the calculation of Con soU dated Net Operating Income for
such Subsidiary pursuant to clause (il) Of the definition thereof (but only in the same
proportion as the. net operating income (or loss) of such Subsidiary is excluded), less
consolidated interest income, all as determined on a consolidated basis in confbtmity
with, GAAP~ provided that. to' the extent that PacifiCorp has any Subsidiary that is not a
whollyoWilw. Subsidiary, Consolidated Interest Expense sl1all be reduced by an amount
equal to such il1tereStexpenseof such Subsidiary inultipliedby the quotient of (A) the
number.of shar~ of outstanding common stock of such Sub$idiary not owned on tbelast
day .of such periOd by PacifiCotp or any SubSidiary ofPaCiflCorp divided by (B) the total
number of shares .of outstanding common stock of such SubsidiClify on the last day of such
pei'iod.
Consolidated Net Operating lI.come!" means, for any period, the aggregate .of
the net. operating income (or loss) of PacifiCorp, and iitsSubsidiaries for such period, as
determined on a consotidated basis in conformity with GAAP; provided that the
following items shall be excluded from any calculation of Consolidated Net Operating
Income (Without duplication): (i) the net operating income (or loss) of any person (other
than a Subsidim'y) in which any other person has a joint interest, except to the extent of
the amount of dividends or other distributions actually paid to PacifiCorp or another
Subsidiary ofPacifiGorp during such period; (ii) the net operating income (or IbSS) of any
Subsidiary to the extent that the declaration or'payment of dividends or similar
distdbutions bysu0h Subsidiary of suchn~luperating incom~ is not at the time pennilwd
by the operation of the terms of its charter or any agreement, instrument judgment
decree, O1'der, statute, rule or govenu1.1entall'egulation or license; and (Hi) all
extraordinary gains and extraordinary losses.
Curltency, Interest Rate or C1)mmodlty Agreemen~'C1, roeans an agreement or
transaction invdNingany'cutt-ency, interest rate or ehetgy price or vol~tric swa;p, cap
or.Oniit'a:mmgement~ fbrwardexchange transaction; option, warran4 forward rate
agreefiJ:ent, futures conb'actOf otheI;.derivative instrumeAt of anyki.h~ for the hedging' or
rhai1ag~mentoffo:reign eX:Ghange,intetesl rate or enetgypriceor volumetric risks, it is
being understood) for purposes' oftblsdefinition, thatthetenn ~'energy" shan i,nclude,
withoUt limitation; coal. gM, QU and eleetctejty.
Distribution" 111em1S any dividend; cl1strjbution. or payxaent (including by way of
redemption, retirement, return or repayment) in respect of sh~ ofcapitaI stock of
Pacifi.Corp.
GAAP'; IIieansgeileraIly acceptedaccoutiting principles in the United States as
in effe:ct fromnme to time.
lD4ebtedrtess" means, with respect to PacifiCorp or ji1)Y of its Sub$idiarles .
any da~ of detemination (without dui.Ylhjati,on)~ 0) all Indebtedn~s for Borrow-ed
Money. (ii)al1 obIigationsin :respect of l~tters ofcredh or 0th~r s~lniwinstrurneJ1ts
(induding reirnbtusenientobligations with respecttheteto)., (Hi) al1 obligations to pay-tho
defelTed andanpaidpurchaseprice of property o:rservi:j:;es~which purchase price is due
more than.$ix mohtlls after the d~te ofplatingsuebprop~rt.y ,1'1 service or taking d;elivery
and title thereto or the completion of such servicesi exceptttade payablesr (iv)a1l
Capi~zed ~a$e Obligations, (v)a11indebtednes~of othel'persops s~ured by'
mortgage; charge, lien,; ple4ge or other se~urity interest OIl "any asset of PacifiCotpOI any
of its SUbsidiaries. whether or not such indebtedness is assUlfied; provided. that the
amount of such Ihdebtedne$s spall be- tite lesser of (A) tbe fair market value of such asset
at such date of determinationr and (B) the amount of the secured indebtedness, (vi) all
indebtedness of other persons ofthe types specified In the preceding clauses (i) through
(v)j to the extentsu",h indebtedness is guaranteed by PacifiCorp or any of its Subsidiaries,
and (vii) to tl1e,extent not otherwise included in thisdefinitio1l; obligations under
Currency, Interest Rate or Commodity Agreements. The am.ount of Indeptednessatany
date, shall be the outstanding balance at such, date of all unconditional obligations as
described above and, upon the occur;rence of the CQnting~cy givinglise to the
obligation the maXimum liability of any contin.gentobligations of the types specified in
the preceding clauses (i) through (vii) at Sl1Ch date; pro'iJitkeJ. that the amount outstanding
at any time of any Indebtedness: iSsued with original issue discount is the: face' am.(;mnt of
such Indebtedness less the remaining unamortized portion of the o'l.'iginlli issue discount
of s Udl Indebtedness at Such time as determined Incpuformi'ty with GAAP.
Indebtcdncssfor Borrowed Money" means any indebtedness (whether being
principal,prernium. interest or other amounts) for (i) money borrowed, (ii) paymcmt
obJigatio.ns 1.md~r orin respect of any trade 'acceptance or tirade ~ceptance credit, or (Hi)
any notes; bonds, debentures, debenture stock, loan stock or other debt securities offered.
issued or:eij'stribut~d whe:ther by way of public Off~I, priva~e placement, acquisition
considetati'on or otherWise aJ:ld whether issued for casher in whole-oi- in part for a
Col15ideration other than cash. prOiJide.d, howflVer; in each case that sueh term shall
exclude any indebtedness relating to any accounts receivable securitizations.
Interest Coverage Ratio" mean&, with .fe$pect to ;PacifiCorp on any
Measurement Dat~t the ratio of (i) the aggregate amount of Consolidated EBlTDA of
PacifiCorp for the four fiscal quarters ft)fwmchfmaneial imormation,m respect thereof is
available immediately prior to such Measurement Date to (ii) the aggregateConsdIidated
Interest Expense during such four fiscal quarters.
Leverage Ratio" m~al1S the ratio of Consolidated Debt to Total Capital;
calculated on the basis of the mostrecerttly jlvailableQons('5lidate:d bal!U1ce sheet
PadfiCorp and, itS, consolidated Subsidiaries (provided. that such b~lance sheetis as of a
date not more than 90 days prior to a M~asurernent Date) prepared in accordance with
GAAP,
Measurement Date" meatls the- record date, for any Distribution.
Subsidiary'; means, with respect to any person, any corporation. association,
partn~rship, limited liability company or 'other business entity of which 50% ot more of
the total voting power of shares of capital stock or other interests (includirtgpartnership
interests) entitled (without regard to the occurrence ()fany contingen(;y) tOyote in the
election ofdirettofS; mana:gers, Of trustees thereof is at the same time owned1 directly or
indirectly, by (i)sl.lch person. (it) such person and one or mOre Subsidiaries of such
person, or (Hi) one or more Subsidiaries' of sucb pers()n.
Total Capital;. of an" person is defiI1ed tomeatl; as of any date, the sum
(without duplication) of (a)1ndebtedness forBQITOwed Money, and (tJ;) consolidated
stockholder s equity of such person and its consohdated Subsidiaries.
Independent Director.
From the time an Independent Director is initially appointed and for so long as the
Company holds orowrts an Equity Interest, the Comp~y shall at ali tUnes have at least one
Inde,pendent Director who; except as provided in Section8(a), wHlbe appointed by the Member.
To the fullest exteI)t permitted by Section 18~11Ol(c) of the Act, the Independent DirectQr shall
corisidetonly the interests of theCompnny, lOel OOing its respective creditors, in acting or
otherwise voting on the matters that come before them. N Q Independent Director shall at any
time serve as trustee in bankruptcy fOr any affiliate of the Company.
10.Enforcement by Independent Director.
Notwithstanding any other provision of this Agreement, the Member agrees that
this Agreement, inc1ud1ng, without limitation, Sections 7 9, 18.22; 24 ahd 28, cohstirntes, a
legal. valid and binding agreement of the Member, and is enforceable against the Member by the
Independent Director; iri accordance with its terms. 111 addition, the Independent Director shall
be an intended beneficiary of this Agreement.
11.Officers.
The,officers of the Company (the "Officers )shan be responsible for the day to
day opel'ations oftbe Company and shall not be deemed'to be "managers" of the Company as
such term is defined in Section 18-10:J(1O) of the Act. The Officers shaUbe:cbosen by the Board
al1dshaU consjstof at least a Pr~~ident, Ii Vice Presid~)1t, aSecretM"y and a Treasurer. The Board,
of Directors may also choose more Assistat1rSecretaries.and Assistant TreaBurers. The
following'persons shall continue to be the initial officen of the Company and shall have the titles
set forth opposite fueit rt$p~tlve names, each to holdoffi~ uhti,l his respective successor is, duly
appointed by the Board of Directors or until his earlier resigrlation or removal:
Name
Gt~g,ory E. Abel
Brian K. Hankel
WayneF. Irmiter
Mitchell F.Ludwin
Steven R.EVartS
JamesC. Galt
PoSition
President
Vice President & Treasurer
Vice Presideht & Controller
Vice President & Secretary
Vice President, Taxatiop- '
Assistant Treasurer
The Board maya,p,point such other Officers and ag~nts as it shall have deemed
necessMY or advisabl~ who shaJlhold thcir offICes for such tetT'iJsand. shaH exercise such P()WeT~
and perform 5 uch dutie$ as shall 'be determined from tim~ to time by the Board. The salaries of
all Officers and agent&of the C()mp~y~if any. shall be fixed by or in the manner prescribed by
the Bo8.rd. The Officers of the Company shall hold office untH their successors are chosen and
qualified. Any Officer electecior &P'pointed by tW-'Boardmay be removed at anytime, with or
withoutncause; by the affirmative vote of the majority of the votes held by the Directors on the
Board. Any vacancy occuning in arty office of the Company shall be fined by the BQard.
(a:) President. The President shall be the chief executive officer of the
Company, shall preside at all meetings of the Member~ if any, and the Board; shal1 be
responsible for the genera! and aCtive management of the bUS-l11egS of the Company; and shall see
that all ordets and resolutions of the Board are carried into effect. The President shall execute all
bonds, mortga,ges and other contractS, except: (1) where reqt.rired or permitted by law or this
Agreement to be otherwise signed and executed~ including Sectio11l7(b); Cii) where signing and
execution thereof shall beex.pl'eS$ly delegated by the:Board to some other OfI1cer or agent of the
Company; and (iii) :as otherwise permitted in Section 11(0).
(b) Viue PreNidellls~ In the absence of the Pr~sidenl or in Lhe event of the
Presi dent's inability to act~ the Vice President , or inhere are more than one, the Vice Presidents
in the order deterinii1ed by the Board'(or ifthere shall bt;: no detenJ1it1ation, then in order of
election), shall perform the duties of the Ptes-ident" and when so actingi shall have all thep.owers
of and be subject to all thc reSWict1orls upon the Ptesident. The Vice President shall perform
sllch other duties and have such other powers as the Board may from time to time prescribe.
(c) Secretary and Assistant Secretary. The Secretary shall be responsible for
filing legal dOCtlments, and mainWning reQerds fet the Company. The Secretary shall attend al1
meetings of the Boarda11d all meetings of the Mcmbet; if any; and record aU the proceedings of
the meetings of the Company and of the: Board in a book to he kept for th at purpose. The
Secretary shall give, or cause to be given, notice of aBri1eetings of the Member, if any, and
special meetings of the Board, ~nd shanp~tform such other duties as maybe prescribed by 'the
Board or the President, under'Who~e superviaion the: SeGret~ry sh~l ~erve.The AssistMt
Secretary, if any. or ifthete is m(jre than one; the Msist4fit Secretaries in the' order determined
by the ao~d (or if there be U'osuch determination. then in Qraer of theirelec1ion). shall, in, the
absence of the Secretiu;y or in the event Q,fthe Secretary s inability to ,act, perform fbe dlJues and
ex.ercise the.poWets,of the Secretary 'and shan perfotmsuch other duties and have such other
PQwers as Board may ftom time to time prescribe;
(d) TreaSu,ret aM Ass/srant Tre,asfJr-er. The Treasurer shall have the cuStody
of rEte C()l1ipanyfufidsarids~uriti~s and shall keep full and accurate accoutits of receipts and
di8bursements: in booJc,s belonging to the Company ;md, shall cleposit all itJ)()ne,ys an4o.ther
valuable,effebts itl the nIDfit' ahd to the credit of theCdmpany in slXch depositories as m,ay be
designated by the Board. 'I'm: Tre,asuror sha11 disborsQthe tunds of the Company as may 00
ordered by the Board, taking-proper vouchers forsi:icbd1sbursement$, and shan render to the
Ptesideritand to the Bontd) atits,tcgt'ilar meetings or when the Boards,o requires, an account of
all of the Treasuret"s ~sacti'ol1sa;n:d of the financial Q:onditions of the COmptlIlY. The A$sistant
'I'~surer.ifany, or if therois inorethan one, the ABslstatltTreil&urers in the order detennined by
the Boa(d (or if: there be'DO such determination, then in order of el~ctionJ, shall, in the absence of
th~Ttea$uter oril1the~;Yent of the 1'i~asurer's inability toact,p~form the duti~sand exercise
the' powers of the Treasurer and shall :perfotm' such other duties, an:dhave such other powers: as
tlW BoJ;\1'd mll'Y from. tinte totitne pre$cribe.
(e) Officersli$Agi1ttts; The Officers, to the extt~rtt of their powers set forth in
this Agreement ot'otherwrse vested m them by action of the Board not inconsistent with this
Agreement, ar;e agents of theCpmpanyfor the,putpose oftbe Com;pany business, and the
actions of the Officers taken in accordance Wjthsuch powers shaH bihdthe Company. An
Officer may only bind the Company withoo~pect to the matters having received the requisite
yoteorapproval reqQired by theCettificate or this Agreement.
12.Limited Liabillty.
Except as :othel'wiseexpressly providedin the Act, the d~bt:s. Q'.bligationsand
liabilities of the Company, whetherarisihg in contract, tort; or orhetwise. shall be the debts,
obligations and liabilities. solely of the Company,; and none of the Member or any Director shan
be obligated personally for any such debt, obligation or liability of the Company soJlely by reason
of bedng a Member or Diti:%t0r uflhe Company.
13.Capitnl ConiributiGl1s.
The Member shall initij)l1y hav~ a 10'0% limited liability comp~ny interest in the
Co'Inpany. Capihtl contributions ("Capital Contributions';) shall be made in cash or in the form
of marketable securities or other assets or properties. No Member shall be entitled to withdraw
any part of its Capita.l Contributions tQ, or receive any distributions froIn, theComp,any except as
provided in Section 15 and Se'Ction 22,
14.Allocation of Profits and, Losses; Capital Actounts'
At any time that the Company $hall have more than one Member, a capital
accolJJlt-'!;haU beestablish~d aritlnt~hitained lor e'aoh Member inaccordartce with Sectim'1 704 of
theCbde and the Regulations promulgated thereunder (a8to each Member, its HCapltal
Acco1J.ut"). Allocations of PrQfits t'ind losses to the Members shall be:: made to the Members in
accordance With theltrespectiwpercentage lirtIitedliability CO1'npBnyirHetest8. as the samernay
beadjusted.'puxsuant to Section 13n:om time to time. No MembershaU be required to restore a
neg:dti Ve bal.anue in its. Capi tal Account~t any lime.
15.DiStributions.
Distributions shat1 be made tothe Member at the times and in the aggregate
amounts determined by the Board. Notwithstanding any provision. tb the contrary contained in
this Agreement, the Company shall not be required to make a distribution tothe Member if such
distribution wo.uld vil51ate Sections 18-607 or 18-804 of the Act or any other applicable law.
Except as otherwise provided by law, no Member shall be required to restore to
the Company any funds properly distributed to it pursuant to this Section 15.
16.Uoolts' andRe~ord.s.
The Board shall Reep or caus~ to be kept cQmplete anda:e~orat~ books of account
arId retards withresp~clLO'lh~ COIIlpaity is bosin~s. The books of the Company shall at all
times be maintained by the Secretary. The Member and it~ duly authorized representatives shaH
have thelighl to examine the Company books, records and dOCliillt.-'ntS during normal busim,ss
hours. The Board covenants fm' itself and on behalf of the Company, not to exercise any right it
may have to keep confidential from the, Member allY 111foi11i.ation that the Board wo'Old otherwise
be permitted to keep confidential from the Member pursuant to Seedon 18..305( c) of the Act.
The CQmpany s books of account shall. be kept t,1sing the method of accou,nting determined by the
M~mber. The Company s independeI1t auditor shall be allin-dependent public accounting firm-
selected by the Member.
17.fRe.~erved )
18.Exculpation and Indemnification.
(a) NaMembct, Officer, Director, employee, agent or affiHate of the
Company and no employee, repre$entative or agent of 8J1 affiliate 9f the Company (collectively,
the "Cnverecl ,Persons ) shall be Hable to the Company for any loss, damage ol'claim incurred,
by reason of any act 01' omission performed or omitted by such Cove-red Person in good faith on
behalf of the Company and in Ii manner reasonab1y believed to be Within the scope of the
authority conte11'ed onsoch Covered Person by this Agr-eement excepting a Covered Person shall
be lia1:l1e for any such loss, damage or claim incurredhyreason of such Covered Person s gross
negligence or willful miscondUct.
(b) Except as Qtherwise provided,hereill, the Board shall cause the Company
to, to the extent legally pel111issible, indemnify each Covered Person against all liabilities and
expenses (jnCluditlgjudgment$,fines.pena1tie~ and re'asonab1e attorneys' fees and al1am:ounts
p~d, other than to the Company, incompron:1i~ or settlement) iITlPQ1;ed upon or incurred by any
s\X;cn ~tSQh in CGt).n'ection With oratisingeUt of" the defense or disposition of any actiOi1~ suit O!
oth~proceeding"whether' civ-H or criniinal,Jn which he of'she may be a defendant or with which
he,er'sli:e l.lUJy b~tlUeate:l1edot()th~t'Wi$ejt1Yolved, dir.ectlyorindireQtly. byr~son of his or her
b~ill.g or havihgbeen such a Covered Person.
(0) A Covered Per$on shall Defu11y.protectedin relyfngin goodfaith upon the
records of the Cornpany~hd llPon sUCh informadon,opinions, reports ot- statements pte$ented to
the Company by any Personas to thatter8 the Covered Person reasona.bly belieY~ are within
su-ch O'the.!.' PeJl'son IS professional or exp:.ext cornpetence and who has been s~lect~d wi~h
reasotlable care by or on behalf of th~CotnPili1Y, including infornaaoTI, opinions, repolts or
statements as to the v.al\1~a1'1tdam.ount ofth~ assets, liabilities, or My ,other facts pertinent to the
existence and. amount of assets from which distributions to the Me:tnber might properly he paid.
Cd) To th~extent thalf at law or in equity, a: Coveted Person has duties,
including fiduciary dutie~, ~ndliabi1ities relihtingthereto tothe CQ.'mpanyor to any otherCOver~d
Pe,fSoh, a Covered: PerSon a;cting under tbisAgretmentshall not be Jillble to the Company or to
au-yother CoveredPemon for its good faith reTi.anceon the provisions of this Agreement 01' any
approval or authorization granted by the Company or any other Covered Person. The provisions
of this Agteement. to the extent that they restrict the duties and liabilities of a Covered Person
otherwise existing at law or in equity, are agreed by the Member to replace such other duties and
1iabiliti~s of such GoveredPerron.
(e) The Cottlpany shall provide no intlemnifica.tiohwith respect to any matter
as to which any such CoveredP,erson shaH be 'r1U~ly adlW1icated in such action, suit or
proceeding nOt to haVe acted in good faith in the reaspnable' belief that his Of her~tion was
the best interests,ofthe Company. TheCotrlpanyshaU provide no-indemnification with'respect
to~y matte:tsettled orcornpromtsed, pursuant to consent decree qr otherwise. unless sUCh
settle'rlietlt or compromise shall have been approved m;ifithe best interests of the CompanY1 after'
natke thatindemnification is involved. by (1) a disinterested majority of the Board of Directors,
or (ji) the Member.
(t') Indemnification'maytnclude payment by the Cornp~y of expenses in
defending a civil or criminal action ot proceeding in advance of the, fin aD 4i~position of such
actioil OJ' proceeding upun an und~laking of the person indemnified to repay such payment if it
is ultimately determined that su'chperson:is not entitled,toindenmificatipn.
(g)
The right of indemnification shall not be exclusive of Of affect any other
rights to which any Covered Person may be entitled under any agt'et'lment, 8tatute~ vote of the
M~mber or otherwise. The Company s obligation to provide indemnification shall be offset to
the ext~nt of anyG5tl1er source of indemnification 01' any otherwise applicable ins\.1.rance coverage
under a policy maintained by the Cbrnpany or any other person.
(h)
of this Agree111ent.
Theforegoing provisions pfthis, Section 18 shall survive any termination
19.Assignments;
Subject to Sections 20 and 21, th~' Member may assign in whole orin partits
lirnitedlia;bUity company i.nt~rests in th~ Company. Ifan'YMemb~l'transfers s.ll of its limited
liability company tnterestih the:CompahypursUafitto this Se~tion 19; the transfereeshaU be
admitted to the Company as a r:n~~Qer' ofthe Cpmpanyupon its execution of an insh'QID,ent
sigpifying its agreement to be bound by the teW$ andcQ'nditlol1s of tl11$ A~en1ent, which
instromentma.y beacountetp:art signature page to this Agreement. Such admissionshallb,
deemedeff~ctive itnmedi'ately p,r~0r to the withdraWal in(;;ident tO$l1ch transfer, anti. imme9iarely
following such admissibThi the transferor Member shall cea.se, to be arnemberof the Company.
Notwithstanding anything in tlrisA-greement 19t)aeQontnu:y, any SUCC~81$(,)rto a Member by
metgeror cO1'isolidatiort~shiall, without furtl1er act, be a M~mbefheteUhder; and such merger or
coD$QIidatton shall110:t coustifuteanas$ignmelit for the putpo..')es of this Agteement.
Tral1B(ers.
So long as the Company holds ot oWns an Equity Interest, any 'transfer of .a
Hrnited liability company interest in the CQIhpany i8n01 petrci1ted except pursuant to Section 19
hereof. Any transfer of a 'limitedliab.ility company interest in the Comp,any tnusicomply with
all applicable I:aws, including the' federalsectuities laws; so as not to violate any such law and
not t() cause aEyoff~r or transfer of such aninterest, secprity, entity orarrangWlent. or th~
Company itself, to be subject to registration under sWear federal :securities laws.
21.Admission, of Admtional Member.
One orffiore additional mernbersoftjte Company m~y be admitted to the
Company witb the written COhS:e:rtl of theM~niber,p.rovided that, notwithsta,nding the foregoiug,
so . long as the; Company hoods or owtlsan Eqblity Irtter~s~ no additiOrta1membe-rs may be
admitted to the Company unl~a thv Member retains a majority in :perc.~ntage UmitedliabHity
company interest in the Company.
22.Dissol utfQn.
The Company shall be dissolved, and its affairs ,$hall be wound up only
upon the entry of a decree of judicial dissolution und6t Seeli(:m 18i-802of the Act~ and shall ,tlot
dissolve'pJi.or to fheoccl1rrence ohnch event, provided however, to the fullest exJ(mtpe.tn1itted
by law, the' Member afld the Dh'ectors ~hall not make an ,appli'cation untkr Section 18-802 of the
Act so long as the Company holds or owns an Equity InWt'est.
(b) So long as the Company owns orholas an Equity Interest, the Member
shall caUse the Company to have; at all times, at lea.~t one perSQ11 who shaH automaticaUy
become a member having O%econotnic ihteresl in the Company (the "Springing Member
upon th~ dissolution oHhe Member or upon the occurrence of any other event that causes the
Member to cease being a member of the Company. Upon theoccmrence of any such event, the
Company shall he continued without dissolution and the Springing Member shall, without any
ac.tionof any person orefili'ty, automatically and sirnul taneously become a member of the
Company having aO% economic interest in the Companyandthe Personal Representative(s) (as
defined in the Act) of the Memt;,er shall automatically become an unadmitted assignee of the
Member, being entitJedtllei'eby only to the distributions to which the Member was entitled
hereunder and any other right confen;e4 thereupon by tb"Act. In ordertojm,plement the
admissionofthe Sp,ringing Member as a member of the COtr1pa1i:y~ the Springing Member has
executed a counterpart to this Agreement as of the date hereof. Pursuan1; to Section 18--301 of the
Act, the Springing,Member shall not be required to make any c~pital contributions to the
Company and-shall not-receive artylimitedlia:bility cornpanYinterestin the'Co11lpany. Prior to
its admission tp the Company as a member of the CompanYPUf$Uant to this Section 24(0), the
Sptirtging Member shaH have, no interest (~onotniC or otherwlse)andis not a member of the'
Company.
(c) Notwithstanding ,auy other provision of tbis Agr.eement, the Bankruptcy of
a Member shall not cause theMemb~r to cease to be am.embet of the Company and upon the
occurrence: of such an event, thebusines.s of the Company shall continue without dissolution.
Notwithstanding any other provi~ion of this ;\gteemenJ, the Member waives any right they might
hav~ under Scott on 18..80.1(\)) of the Act to agree in Writing to dissolve the Company upon the
Hankruptcy of a Member or the occurr.ence of any other evenhhat causes such Memher to. cease,
tQ be a member ofth,e Company, "Ba11kntptcy" means, Withrespectto a Member, if the
Member (i) makes an assignme11t for the ~nefit o.fcre(ijtors; (ii') files a voluntiu:ypetitiQn in
bankruptty. (iii) is adjudged a bankrupt o't'1nsolvent; or hag entered ~gahi.$t itself ail order for
relief) in any bankruptcy or insolvency proceeding; (iv) fi1esa~titiOtroranswer seeldng for
itself any reorganiza,tion, artang~tnent, compQ~jtion, r~dju$tm.entj liquidation, dissolution
similar relief under any statute, law ot regtiJation, (v) me&' an. answer orothe:r pleading admitting
or failing to conte-.st the mate.ri(lil allegJ;\.tions of a petition filed against it in any proceeding of this
nature, (vi) seeks, consents to Qtacquiesce.s in the appointment of a trUstee, receiver or liquidator
01 the Member OI'of all 01. any substantial part of its prOpt~rties, or (vii) 120 d~ys after the
commencement of any proceeding ~gainst the Member seeking reorganization, ammgement,
composition, readjustment, ltquidatiofi, dissolution, or similar reI ref under any statum, law or
regulation, iftheproceedings have not been dismissed, or if within 90 days afrerthe
appointment, witham the Member s consent 0.1' acquiescence:, of a trust~, receiver or liq1)idator
of the Member or of all or any substantial part of i t8 properties, the appointment is not vacated or
stayed. or within 90 days after the expiration of any such stay, the~appointment is not vacated.
With respect to. the Member, the foregoing definition of "Bankruptcy" is intended to replace and
shall supersede the definition oC'bankruptcy" set forth in Sections 1~ 10.1(1) and 18-304 of the
Act
(d) In the eVent of dissolutibl1, the Company shan conduct only such activities
as arenecessa;ry to wind up its affairs (including tile sale of the assets of the Company in an
orderly matmer) , arid the assets of the Company shall beappHed in the manner, and in the order
of priority, setforth in Section 18~804 of the Act. Upon completion of-the winding up process,
the Hoard 8h~H cause the execution and filing of a Certificate of CanceHationjn accordance with
Section 18-203 oftbe Act.
23.Waiver of Partition; Nature of Interest.
Except as otherwise expressly provided in this Agreemen~ to the fullest extent
permitted by 1ltw, the Member hereby irrevocably waives any right otpower that the Member
might have to cause the Company or any of its assets to be partitioned, to cause the appointment
ora rec~j:v.er for alloranyporti on,()f theassets~ of tha Company,., ta' cO'ttlpel any sale of aUoran:r
portion oftheass~tsonhe Company pursuant tp ~1J,y ~pp:licl:\blc law or tp file acomplaillt or to
institute any proceeding at law or in equity to cause the Qissolutiol1 , tiqui~tioni winding, up or
termination of the Company. No Member shall have any interest in: ~ny specific: asset of the
COtl1.pa,ny,., and 110 M~rnber shan h~ve the status: ora creditor with re~p.~ct wartydistributiQt1
pursuanttoSectiort15 hereof. The limited liability company lrtterests'oftheMemberinthe
Company are personal property.
24.Ben~of Agreement: No ThIrd-Party ~tghts.
None of theptOvis10n$ofthis Agreern:ent shull be fQrthe benefit of or enforceable
by any creditor of the, Gornpany or by any creditor ofaMember. Subject to Section 10, nothing
in this Agt~eme1it shal1'gedcefp.~d to create any right in apy :perspn (qther than Covered ~rs()tl8')
not a party hereto, andtbis Agreement. shall not becOJ! s~tUed in art y,'1'6Spect to be a conttact in
whole or itlpart for the benefit of anY third Pet$()11.
This Agreement shnU be binding UPOfiahd inure tothe benefit ofthe Member and
its succ~sor8, and petrnltted ,assig;ns.
25.S~verability olPl'oviskms.
Ench provision of this. A,gree~nt shall oe~onside'i:ed severable and if for any
reason any provision or provisi(:)ns herein are determined to be invalid, unenforceable or illegal
under any existing or future law, such invalidity, unenforceabUity or illegality shaH 11ot impair
the operation of or affect those portions ofthis Agroomertt which ate valid, emorceableand
legal.
26.Entire Agreelllent.
This Agreement cortsfitut$s the entire agreement of the parties with respoot to the
subject matter hereof.
27.Governing Law.
This Agreernentsballbe governed by and construed underthe laws of the State of
Delaware (without ~gardtoconflic.t of laws principles-); all tights:andternedies beinggove11led
by saidl(tws. Each pWiy befetQ (1) irl'~vocablY$tibrp:its to the n(jll~explusivejurisdiction of any
Delaware State court Or Federal court sitting in Wihningtoh, Delaware in any action arising out
of this Agreement, and (ii). consents to the seFVice ofproces$ by nuriL Nothing herein shall affect
the tight of allY party to serve legal proCess in any manner permitted by law or affeCt to bring any
action in any other court.
28.Amendmen ts.
Neither this Agrecmct):t nor tho Cei'i:ificate may be modified;altcl'ed,
supplemented or amend&i(each such event being referred to asa "Change1 ') except pursuant to
a. written agreement executed and,d~livcred by thc M!,)mbcr. 8.0 lQ:ng as the Company holds or
owns an Equity Interest and Pacifi.Gotpor any subsidiary thereof bas any debt outstanding that is
F~ted by Sfandard& Poor ! Moody s lrivestors Servic6; or by FittH) Ratings (~ach, a "Rating
Ag~ncy")\ no, Change shaUtakeeffecttinl~ss (i) each Rating Agency rating such debt shall have
deUvered a written c(jnnrmation that suchChapge wi11not result in the. downgrade or withdrawal
of any such rating assigned by itto suell debt, and (Ii) tJie Independent Director shall have
approved the Change in a vote of Directors if the Change relates tQ Secti'on 7, Section 8(0 or
Section 9; ptovided thatnom~, ofthe conditions identified in either of clause (i) or(ii) hereof
needs be satisfied if the Change is designedto: ex) cure anyambiS\tity or internal inconsistency
in this Agreement or the Certificate, 01' (y) convert ol'SlWplementanY provision bereofin a
manner consiste.t1t with the intent of this Agreement 01' the Certificate.
29.Counterparts.
This Agreement may be ex~Uted in any number of counterpatts , each ofwhich
shall be deemed an original ofthis Agre~ment and aU of which together shaH constitute one. and
the snme instrument.
30.Notices.
Any notices required to 'be delivered hereunder shall be in writing and persQnally
delivered, mailed or sentby telecopy:; electronic mail, or other similar fotin of rapid
ttans:1Ilission, andshtill be deemed to have been duly given upon receipt (a) in the ca$e of me
Company, to the Company at its address set forth in Section 2~ (b) in the case: of a Member, tb
the Me1)1ber atthe Company's address setfot.ih in Section 2, and (c) in the case of either of the
foregciinrg, at'such other addtess as ma;y bedesignat(:d by written notice to the other party.
31.Captio'l1s.
All captions used in this Agreement are for convenience only and shall not affeet
the meaning Or construction of any provision hereof.
IN WITNESS WHEREOF, the undersigned hiisexectited. this Agreem~ntas of the
da,te first above written.
MIDAMBRICAN ENERGY HOLDINGS
coMPANY
las, L. Andersol1'
Vice Presidefit & General Counsel
MAR-20;,.2000 MON 10: 44 AM M lDAMERIOAN ENERGY
RECEIVED TIME MAR. 20. 10:41AM
FA~ NO. 515242 403J P. 02
Gregory B. Abel;
as 5.pdn ,M~mb.er
PRINT TIME MAR. 20, 10:41AM