20100607Notice of Affiliate Transaction.pdf

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201 South Main, Suite 2300
Salt Lake City, Utah 84111
June 7, 2010
Idaho Public Utilities Commssion
472 West Washington Street
Boise, ID 83720-5983
Attention: Jean Jewell
Commssion Secreta
Re: Rocky Mountain Power Notice of Affliate Transaction
Case No. PAC-E-05-8
Dear Ms. Jewell:
This letter will serve as notice pursuat to Commitment I 17(2), incorporated in the Idao Public
Utilities Commssion Order No. 29973 issued Februar 13, 2006, as supplemented by Order No.
29998 March 14, 2006, in the above-referenced proceeding, approving the acquisition of
PacifiCorp by MidAmerican Energy Holdings Company ("MEHC"), of an affiliate interest
transaction with Wells Fargo Ban, N.A. ("Wells Fargo"). The Company will obtain letters of
credit from Wells Fargo to enhance four series of varable rate Pollution Control Revenue Bond
Obligations ("PCRBs"). These letters of credit will be issued under the terms and conditions of
the Company's $635 milion revolving credit agreement, with Wells Fargo serving as the issuing
ban.
Rocky Mountan Power is a division of PacifiCorp which in tu is a wholly-owned indirect
subsidiar of MidAerican Energy Holdings Company ("MEHC"). MEHC is a subsidiar of
Berkshire Hathaway, Inc ("Berkshire Hathaway"). As of March 31, 2010, Waren E. Buffett (an
individual who may be deemed to control Berkshire Hathaway), Berkshire Hathaway, varous
subsidiares of Berkshire Hathaway and varous employee benefit plans of Berkshire Hathaway
subsidiares together held in excess of 5 percent interest in Wells Fargo common stock.
Therefore, Berkshire Hathaway's ownership interest in Wells Fargo may in some jursdictions
create an affliated interest.
The PCRBs were previously issued and proceeds have been used by the Company to finance, or
refinance, the construction and operation of certai qualifying air pollution control facilties, in
accordance with federal law, located at the Company's generating facilties. There wil be no
change in the amount of or matuty of the PCRB obligations.
In addition, the Company anticipates that Wells Fargo will be appointed remarketing agent for
the Lincoln County series of PCRBs and will be paid a remarketing agent fee for those services.
The Company will be obligated to reimburse Wells Fargo for any drawig under the letters of
credit, to pay certin fees and expenses, to pay interest on uneimbursed drawings or for other
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Idaho Public Utilties Commission
June 7, 2010
Page 2
amounts unpaid, and to reimburse Wells Fargo for certn other costs and expenses. The
Company believes these terms and conditions, including fees, are normal and tyical for
transactions of ths type and are at market rates.
The Company is makng these changes to the PCRB programs in order to provide a reduced cost
of debt for the benefit of customers. It is expected that the ratings on the four seres of PCRBs
will be upgraded to "Aa2NMIG 1" and "AAA-1+" due to the Wells Fargo letters of credit.
Please call Danel Solander at [phone] or Ted Weston at [phone] if you have any
questions regarding this fiing.
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