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Home My WebLink About20080721Report 1st Mortgage Bond Offering.pdf~ROCKY MOUNTAINPOR A DMSION OF PAACOP 201 South Main, Suite 2300 Salt Lake City, Uta 84111 q,o"\..* ....t: July 21,2008 VI OVERNIGHT DELIVERY Idaho Public Utilties Commission 472 West Washington Street Boise, Idaho 83702 Att: Ms. Jean Jewell Commssion Secreta Re: Case No. PAC-E-07-16 Order No. 30489 Report of First Mortgage Bond Offering in Aggregate Principal Amount of $800,000,000 Dear Commissioners: Pursuat to the referenced Order, PacifiCorp submits to the Commssion an original and nine (9) copies of the followig documents relating to PacifiCorp's July 17,2008 offerig of $500,000,000 aggregate pricipal amount of First Mortgage Bonds, 5.65% Series due 2018 and $300,000,000 aggregate pricipal amount of First Mortgage Bonds, 6.35% Series due 1038 (the "Bonds"): 1. Prospectu Supplement dated July 14, 2008 2. Underwting Agreement between PacifiCorp and Lehman Brothers, Inc., Greenwich Capital Markets, Inc., J.P. Morgan Securties, Inc. and Wachovia Capital Markets, LLC dated July 14, 2008 3. Report of Securties Issued With regard to the use of the proceeds from the issuance of the Bonds, please see "Use of Procees" on page S-8 of the enclosed Prospectus Supplement. Under penalty of perjur, I declare that I know the contents of the enclosed documents, and they are tre, correct, and complete. Idaho Public Utilties Commssion July 21, 2008 Page 2 of2 Please contact me if you have any questions about this letter or the enclosed documents. Sincerely,~~WL Bruce N. Wiliams Vice President and Treasurer Enclosures Cc: Terr Carlock (Idaho Commission) Ted Weston (PacifiCorp) PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED JANUARY 9, 2008 PACIFI.(öRP A. MIDARI ENERGY HOLDINGS CO $800,000,000 First Mortgage Bonds $500,000,0005.65% Series Due 2018 $300,000,000 6.350/0 Series Due 2038 0,",. ....j The 2018 bonds will bear interest at 5.65% per year and will matue on July 15,2018. The 2038 bonds will bear interest at 6.35% per year and wil matue on July 15,2038. We wil pay interest on each series of bonds on Janua 15 and July 15 of each year, beginning on Janua 15,2009. We may redeem some or all of the bonds of each series at any time at the redemption prices discussed under the caption "Description of the Bonds-optional Redemption." We will not apply for listing of either series of bonds on any securties exchange or include them in any automated quotation system. Investing in the bonds involves risks. See "Risk Factors" on page S-7 for information on certain matters you should consider before buying the bonds. Per 2018 Bond Public Offering Pricer!) 99.819% Underwting Discount 0.650% Proceeds to PacifiCorp (Before Expenses) 99.169% (1) Plus accrued interest, if any, from July 17,2008. The underwiters expect to deliver the bonds to purchasers through The Depository Trust Company on or about July 17, 2008. Total $499,095,000 $3,250,000 $495,845,000 Per 2038 Bond 99.443% 0.875% 98.568% Total $298,329,000 $2,625,000 $295,704,000 Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus supplement or the related prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Joint Book-Running Managers Lehman Brothers JPMorgan RBS Greenwich Capital Wachovia Securities Co-Managers Scotia Capital Barclays Capital BNPPARIBAS Goldman, Sachs & Co. Banc of America Securities LLC Citi Credit Suisse Piper Jaffray SunTrust Robinson Humphrey Wed bush Morgan Securities Inc. WeDs Fargo Securities The date of this prospectu supplement is July 14,2008. TABLE OF CONTENTS Prospectus Supplement Page About This Prospectu Supplement............................................................................................. S-3 Prospectus Supplement Sumary ............................................................................................... S-4 About PacifiCorp ......................................................................................................................... S-4 The Offering ................................................................................................................................ S-5 Risk Factors ................................................................................................................................. S-7 Summary Consolidated Financial Information ............................................................................ S-7 Use of Proceeds ........................................................................................................................... S-8 Capitalization............................................................................................................................... S-8 Consolidated Ratios of Earnings to Fixed Charges ..................................................................... S-8 Description of the Bonds .............. ............................................................................................... S-9 Certin United States Federal Income Tax Considerations ......................................................... S~12 Underwting................................................................................................................................ S-15 Legal Matters.............................................................................................................. ................. S- 1 8 Experts .......... ................................................................................... ................................... ......... S-18 Prospectus About This Prospectu......... ................... ............................................... ...................................... 1 Risk Factors........... ........................................... ........... ................................................................ 1 Forward-Looking Statements ;..................................................................................................... 2 The Company .............................................................................................................................. 2 Consolidated Ratios of Earings to Fixed Charges ..................................................................... 3 Where You Can Find More Information ..................................................................................... 4 Use of Proceeds ........................................................................................................................... 5 Description of Additional Bonds ................................................................................................. 6 Book-Entr Issuance.................................................................................................................... 11 Plan of Distrbution ..................................................................................................................... 13 Legal Matters............................................ ......................................................... .......................... 15 Expert......................................................................................................................................... 15 S-2 ABOUT THIS PROSPECTUS SUPPLEMENT This document is in two pars. The first part is the prospectus supplement, which describes the specific term of the bonds we are offering and certain other matters relating to us and our financial condition. The second par, the base prospectus, gives more general information about securities we may offer from time to time, some of which does not apply to the bonds we are offering. Generally, when we refer to the prospectus, we are referrng to both parts of this document combined. If the description of the bonds in the prospectus supplement differs from the description in the base prospectus, the description in the prospectus supplement supersdes the description in the base prospectu. You should rely only on the information contained in this document or to which this document refers you. We have not, and the underwiters have not, authorized anyone to provide you with different information. Ifanyone provides you with different or inconsistent information, you should not rely on it. This document may only be used where it is legal to sell these securties. The information in this document may only be accurate as ofthe date of this document. Our business, financial condition, results of operations and prospects may have changed since that date. S-3 PROSPECTUS SUPPLEMENT SUMMARY In this prospectus supplement, unless otherwise indicated or unless the context otherwise requires, the words "Company, " "we, " "our," "us" and "PacifCorp" refer to PacifCorp, an Oregon corporation, and its subsidiaries. References to the "Mortgage" are to the Mortgage and Deed of Trust, dated as of January 9,1989, as amended and supplemented, with The Bank of New York Mellon Trust Company, NA. as successor trustee. The following summary contains basic information about PacifCorp and this offering. It may not contain all the information that is important to you. The "Description of the Bonds" section of this prospectus supplement contains more detailed information regarding the terms and conditons of the bonds. The following summary is qualifed in its entirety by reference to the detailed information appearing elsewhere in this prospectus supplement and by the documents incorporated by reference into this prospectus supplement. ABOUT PACIFICORP We are a United States regulated electrcity company serving 1.7 milion residential, commercial, industral and other customers in portions of the states of Utah, Oregon, Wyoming, Washington, Idaho and Californa. We own, or have interests in, a number of thermal, hydroelectrc, wind-powered and geothermal generating plants, as well as electric transmission and distribution assets. We also buy and sell electrcity on the wholesale maket with public and private utilities, energy maketing companies and incorporated municipalities. The regulatory commssion in each state approves rates for retail electric sales within that state. We are an indirect subsidiar of MidAmerican Energy Holdings Company ("MEHC"). MEHC, a holding company based in Des Moines, Iowa owning subsidiaries that are principally engaged in energy businesses, is a consolidated subsidiar of Berkshire Hathaway Inc. Our address and telephone number are: PacifiCorp, 825 NE Multnomah, Suite 2000, Portland, Oregon 97232-4116; telephone: (503) 813-5000. S-4 THE OFFERING Issuer. . . . . . . . . . . . . . . . . . . . . . . PacifiCorp. Bonds Offered .... . . . . . . . . . . . $500,000,000 aggregate principal amount of 5.65% First Mortgage Bonds due 2018 (the "2018 bonds"). $300,000,000 aggregate principal amount of 6.35% First Mortgage Bonds due 2038 (the "2038 bonds" and, together with the 2018 bonds, the "bonds"). Each of the 2018 bonds and the 2038 bonds is a series of securties that wil be issued under a twenty-second supplement to the Mortgage. The 2018 bonds are expected to be assigned ratings of A3 by Moody's Investor Services, Inc., A- by Stadard & Poor's Ratings Group and A- by Fitch, Inc. The 2038 bonds are expected to be assigned ratings of A3 by Moody's Investor Services, Inc., A- by Standard & Poor's Ratings Group and A- by Fitch, Inc. However, the ratings are subject to change. Ratings..................... . Maturity Date. . . . . . . . .. . . . . . . Interest Payment Dates. . . . . . . . Optional Redemption . . . . . . . . . Sinking Fund ....... . . . . . . . . . Ranking.................... . Covenants.................. . Denominations . . . . . . . . . . . . . . . July 15, 2018 for the 2018 bonds. July 15,2038 for the 2038 bonds. Janua 15 and July 15, commencing January 15, 2009, for each series of bonds. We may redeem each series of bonds, at our option, in whole or in part, at any time, at a redemption price equal to the greater of: (1) 100% of the principal amount of the bonds to be redeemed; or (2) the sum of the present values of the remaining scheduled payments of principal of and interest on the bonds to be redeemed discounted to the date of redemption on a semi-anual basis (assuming a 360-day year consisting of twelve 30-day months) at a discount rate equal to the yield on equivalent Treasur securities plus 30 basis points with respect to the 2018 bonds, and 30 basis points with respect to the 2038 bonds, plus, for (l) or (2) above, whichever is applicable, accrued and unpaid interest, if any, on such bonds to the date of redemption. See "Description of the Bonds-Dptional Redemption." The bonds will not be subject to a mandatory sinkg fud. The bonds will be secured by a first mortgage lien on certin utility propert owned by us. The bonds will be equally and ratably secured with all other bonds issued under the Mortgage. The lien of the Mortgage is subject to certin exceptions. See "Description of the Bonds-Ranking and Securty." The Mortgage contains a number of covenants by us for the benefit of the holders of the bonds, including provisions requiring us to maintain the mortgaged propert as an operating system or systems capable of engaging in all or any of the generating, transmission, distrbution or other utility businesses described in the Mortgage. See "Description of Additional Bonds-Certain Covenants" in the base prospectus. The bonds are available for purchase in minimum denominations of $2,000 and any integral multiple of $ 1 ,000 in excess thereof. S-5 Use of Proceeds. .. ............ We intend to use the net proceeds from the sale of the bonds for general corporate puroses. See "Use of Proceeds" in this prospectus supplement. Trustee...... ................ The Bank of New York Mellon Trut Company, N.A. will be the trtee for the holders of the bonds. See "Description of Additional Bonds-The Mortgage Trutee" in the base prospectus. S-6 RISK FACTORS Investing in the bonds involves risk. Before purchasing the bonds, you should carefully consider the risk factors included in the base prospectus, our Anual Report on Form 10-K for the year ended December 31, 2007 (the "Form lO-K") and our Quarterly Report on Form 10-Q for the quaerly period ended March 31, 2008 (the "Form lO-Q"). You should also read and consider the other information contained in this prospectus supplement and the information incorporated by reference herein in order to evaluate an investment in our bonds. See "Where You Can Find More Information" in the accompanying base prospectus. Additional risks and uncertinties that are not yet identified or that we think are immaterial may also materially harm our business, operating results and financial condition and could result in a loss on your investment. SUMMARY CONSOLIDATED FINANCIAL INFORMATION We have derived the sumar consolidated financial information presented below from our audited historical Consolidated Financial Statements as of and for the year ended December 31, 2007, our audited historical Consolidated Financial Statements as of and for the nine-month transition period ended December 31, 2006, our audited historical Consolidated Financial Statements as of and for the year ended March 31, 2006 and our unaudited historical Consolidated Financial Statements as of and for the three-month periods ended March 31, 2008 and 2007. This summary consolidated financial information should be read together with, and is qualified in its entirety by reference to, our consolidated financial statements and Management's Discussion and Analysis of Financial Condition and Results of Operations contained in the Form 10-K and the Form 10-Q, incorporated by reference herein. Three-Month Periods Ended March 31, Nine-Month Period Ended December 31, 2006 Year Ended December 31, 2007 (in milions) 2008 2007 Consolidated Statement of Income Information:Revenues......................... . Income from operations .. . . . . . . . . . . . . Net income. ........................ Other Consolidated Financial Information: Net cash provided by operating activities Net cash used in investing activities. . . . . Net cash provided by financing activities $1,095 230 108 $1,027 201 99 $4,258 888 439 $2,924 415 161 $357 (348) 4 $338 (360) 412 $824 (1,497) 842 $431 (1,056) 564 As of March 31, 2008 As of December 31,2007 2006 (in miUions)Consolidated Balance Sheet Information: Total assets. . . . . . . . . . . . . . . . . . . . . . . . . Total debt (1) . . . . . . . . . . . . . . . . . . . . . . . Total shareholders' equity.......... . . . $15,237 4,753 5,187 $14,907 4,753 5,080 $13,852 3,967 4,426 Year Ended Marcb31, 2006 $3,897 792 361 $895 (1,024) 50 As of March 31, 2006 $12,731 3,721 4,052 (1) Includes capital lease obligations, but excludes curent maturities and preferred stock subject to mandatory redemption. S-7 USE OF PROCEEDS We intend to use the net proceeds from the sale of the bonds for general corporate puroses. CAPITALIZATION The table below shows our capitalization on a consolidated basis as of March 31, 2008. The "As Adjusted" colum wil reflect our capitalization as of that date after giving effect to this offering of bonds and the use ofthe net proceeds from this offering. You should read this table along with the Consolidated Financial Statements contained in the Form 10-K and the Form lO-Q. As of March 31, 2008 Actual As AdjustedAmounts Amountsin millons ~ in millons ~ Total common equity....... . .. ....................... . . .. . . Total...... ..... ................ .. ....... . . . . . .. ... .. . . $0.0% $0.0% 414 4.0 414 3.7 4,753 45.9 5,553 49.8 5,167 49.9 5,967 53.5 41 0.4 41 0.4 5,146 49.7 5,146 46.1 $ 10,354 ~% $ 11,154 100.0% Short-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Long-term debt, curently matung (l) . . . . . . . . . . . . . . . . . . . . . . . . Long-term debt, net of curent matuities (l) .. . . . . . . . . . . . . . . . . . Preferred stock. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1) Includes capital lease obligations. CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES Three Months Ended March 31, 2008 2.9x Year Ended December 31, 2007 3.0x Nine Months Ended December 31, 2006(1) 2.1x 2006 2.9x Years Ended March 31, 2005 2.5x 2004 2.4x (1) Following the acquisition ofPacifiCorp by MEHC on March 21,2006, we elected to change our fiscal year end from March 31 to December 31, resulting in a nine-month transition period from April 1, 2006 to December 31, 2006. For puroses of this ratio, fixed charges represent consolidated interest charges, an estimated amount representing the interest factor in rents and preferred dividends of wholly owned subsidiaries. Excluded from the fixed charges is interest on income tax contingencies that is included in income ta expense on the consolidated statements of income. Earnings represent the aggregate of (a) income from continuing operations, (b) taxes based on income from continuing operations, (c) minority interest in the income of majority-owned subsidiaries that have fixed charges, (d) fixed charges and (e) undistrbuted income of less than 50% owned affliates without loan guantees. S-8 DESCRIPTION OF THE BONDS The bonds will be issued pursuant to the twenty-second supplemental indentue to the Mortgage, to be dated as of July 1,2008 (the "Supplemental Indentue"). The terms of the bonds include those stated in the Mortgage, the Supplemental Indentue and those made part of the Mortgage by reference to the Trut Indentue Act of 1939, as amended. Set forth below is a description ofthe specific terms of the bonds. The following description is not complete in every detail and is subject to, and is qualified in its entirety by reference to, the Mortgage and the Supplemental Indentue. Capitalized terms used in this "Description of the Bonds" section that are not defined in this prospectus supplement have the meanings given to them in the Mortgage or the Supplemental Indentue. General The bonds wil be issued as two separate series of First Mortgage Bonds under the Mortgage. The 2018 bonds will initially be limited in aggregate principal amount to $500,000,000. The 2038 bonds will initially be limited in aggregate principal amount to $300,000,000. The entire principal amount of the 2018 bonds wil matue and become due and payable, together with any accrued and unpaid interest thereon, on July 15,2018. The entire principal amount of the 2038 bonds will matue and become due and payable, together with any accrued and unpaid interest thereon, on July 15,2038. The bonds are not subject to any sinking fund provision. The bonds are available for purchase in minimum denominations of $2,000 and any integral multiple of $1 ,000 in excess thereof. Interest Each 2018 bond will bear interest at the rate of 5.65% per annum from the date of original issuace. Each 2038 bond will bear interest at the rate of 6.35% per annum from the date of original issuance. Interest on each series of bonds will be payable semi-annually in arrears on Janua 15 and July 15 of each year (each, an "Interest Payment Date"). The initial Interest Payment Date is January 15,2009. The amount of interest payable will be computed on the basis of a 360..day year consisting of twelve 30-day months. If any date on which interest is payable on the bonds is not a business day, then payment of the interest payable on that date wil be made on the next succeeding day which is a business day (and without any additional interest or other payment in respect of any delay), with the same force and effect as if made on such date. So long as the bonds remain in book-entr only form, the record date for each Interest Payment Date wil be the close of business on the business day before the applicable Interest Payment Date. If the bonds of either series are not all in book-entr form, the record date for each Interest Payment Date wil be the close of business on the fist calendar day of the month in which the applicable Interest Payment Date occurs (whether or not a business day). Ranking and Security The bonds will be issued under the Mortgage and secured by a first mortgage lien on certain utilty propert owned from time to time by the Company. The lien of the Mortgage is subject to Excepted Encumbrances, including tax and constrction liens, purchase money liens and certin other exceptions. The bonds wil be equally and ratably secured with all other bonds issued under the Mortgage. Further Issuances The 2018 bonds will initially be limited in aggregate principal amount to $500,000,000. The 2038 bonds will initially be limited in aggregate principal amount to $300,000,000. We may, from time to time, without notice to or the consent of the holders of the bonds, create and issue fuher bonds equal in rank and having the same matuty, payment terms, redemption featues, CUSIP numbers and other terms as either or both series of bonds offered by this prospectus supplement, except for the public offering price, payment of interest accruing prior to the issue date of the fuher bonds and, under some circumstances, for the first payment of interest following the issue date of the fuher bonds. These fuher bonds may be consolidated and form a single series with either series of the bonds offered by this prospectus supplement. S-9 Optional Redemption The bonds of each series are redeemable, in whole or in part, at any time, and at our option, at a redemption price equal to the greater of: . 100% of the principal amount of bonds then outstanding to be redeemed; or . the sum of the present values ofthe remaining scheduled payments of principal and interest thereon (not including any portion of such payments of interest accrued as of the redemption date) discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Adjusted Treasur Rate, plus 30 basis points with respect to the 2018 bonds, and 30 basis points with respect to the 2038 bonds, in each case as calculated by an Independent Investment Baner; plus, in either of the above cases, accrued and unpaid interest thereon to the redemption date. We will mail a notice of redemption at least 30 days before the redemption date to each holder of bonds to be redeemed. Ifwe elect to parially redeem the bonds of either series, the Trutee wil select in a fair and appropriate manner the bonds to be redeemed. Unless we default in payment of the redemption price, on and after the redemption date, interest will cease to accrue on the bonds or portions thereof called for redemption. "Adjusted Treasury Rate" means, with respect to any redemption date: . the yield, under the heading which represents the average for the immediately preceding week, appearig in the most recently published statistical release designated "H.15( 519)" or any successor publication which is published weekly by the Board of Governors of the Federal Reserve System and which establishes yields on actively traded United States Treasury securties adjusted to constant matuity under the caption "Treasur Constant Matuties," for the matuty corresponding to the Comparable Treasury Issue (ifno matuty is within three months before or after the Remaining Life, yields for the two published matuties most closely corresponding to the Comparable Treasur Issue wil be determined and the Adjusted Treasur Rate wil be interpolated or extrapolated from such yields on a straight line basis, rounding to the nearest month); or . if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the rate per annum equal to the semi-annual equivalent yield to matuity ofthe Comparable Treasur Issue, calculated using a price for the Comparable Treasur Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasur Price for such redemption date. The Adjusted Treasur Rate wil be calculated on the third business day preceding the redemption date. "Comparable Treasury Issue" means the United States Treasur security selected by an Independent Investment Banker as having a matuty comparable to the remaining term ofthe bonds to be redeemed that would be used, at the time of selection and in accordance with customar financial practice, in pricing new issues of corporate debt securties of comparable matuty to the remaining term of such bonds ("Remaining Life"). "Comparable Treasury Price" means, with respect to any redemption date, (l) the average of four Reference Treasur Dealer Quotations for such redemption date, after excluding the highest and lowest Reference Treasur Dealer Quotations, or (2) ifthe Independent Investment Baner obtains fewer than four such Reference Treasur Dealer Quotations, the average of all such quotations. "Independent Investment Banker" means one of the Reference Treasur Dealers appointed by us, or ifthat firm is unwillng or unable to serve as such, an independent investment and banking institution of national standing appointed by us. S-lO "Reference Treasury Dealer" means: . each of Lehman Brothers Inc., Greenwich Capital Markets, Inc., J.P. Morgan Securties Inc. and one other prima U.S. Governent securties dealer in New York City selected by Wachovia Capital Markets, LLC, and their respective successors; provided that, if one of these parties ceases to be a priary U.S. Governent securities dealer in New York City ("Primary Treasury Dealer"), we wil substitute another Primary Treasur Dealer; and . any other Primary Treasur Dealers selected by us. "Reference Treasury Dealer Quotations" means, with respect to each Reference Treasur Dealer and any redemption date, the average, as determined by the Independent Investment Banker, of the bid and asked prices for the Comparable Treasur Issue (expressed in each case as a percentage of its principal amount) quoted in wrting to the Independent Investment Banker at 5:00 p.m., New York City time, on the third business day preceding such redemption date. S-ll CERTAIN UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS The following discussion is a summary of the material U.S. federal income tax consequences relevant to the ownership and disposition of the bonds issued pursuant to this offering, and does not purort to be a complete analysis of all potential tax effects. This discussion does not address all the U.S. federal income ta consequences that may be relevant to a holder in light of such holder's particula circumstances or to holders subject to special rules, such as financial institutions, bank, parerships and other pass-thouglf entities, U.S. expatrates, controlled foreign corporations, passive foreign investment companies, insurnce companies, dealers in securties or curencies, traders in securties, U.S. Holders (defined below) whose fuctional curency is not the U.S. dollar, tax- exempt organizations and persons holding the bonds as part of a "straddle," "hedge," "conversion transaction" or other integrated transaction. In addition, this discussion is limited to persons purchasing the bonds for cash pursuant to this prospectus supplement at the offering price on the cover page of this prospectus supplement. Moreover, the effect of any applicable state, local or foreign tax laws is not discussed. The discussion deals only with bonds held as "capital assets" within the meaning of Section 1221 of the Internal Revenue Code of 1986, as amended (the "Code"). The discussion is based on the provisions of the Code, U.S. Treasur regulations issued thereunder, rulings and pronouncements of the IRS and judicial decisions, all as in effect as of the date of this prospectus supplement and all of which are subject to change at any time. Any such change may be applied retroactively in a manner that could adversely affect a holder of the bonds. We have not sought and wil not seek any rulings from the IRS with respect to the matters discussed below. There can be no assurance that the IRS will not take a different position concerning the tax consequences of the purchase, ownership or disposition of the bonds or that any such position would not be sustained. Prospective investors also should consult their own tax advisors with regard to the application of any state, local, foreign or other tax laws, including gift and estate tax laws. For puroses of ths discussion, the term "U.S. Holder" means a beneficial owner ofthe bonds that is for U.S. federal income tax puroses: . an individual citizen or resident ofthe United States; . a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States or any state, including the Distrct of Columbia; . an estate, the income of which is subject to U.S. federal income tax regardless of its source; or . a trt if (a) a U.S. cour can exercise primar supervsion over the administration of the trt and one or more U.S. persons can control all substantial trst decisions or (b) if the trst was in existence on August 20, 1996, and has elected to continue to be treated as a U.S. person. A non-U.S. holder means a beneficial owner of the bonds that is not a U.S. holder for U.S. federal income tax puroses. For U.S. federal income tax puroses, if a parnership (including any entity or arrangement classified as a partership for U.S. federal income tax puroses) is a beneficial owner of the bonds, the treatment of a parer in the parnership generally wil depend upon the status of the parter and the activities of the parership. A beneficial owner of the bonds that is a partership for U.S. federal income ta puroses, and the parers in such partership, should consult their tax advisors about the U.S. federal income tax consequences relating to the ownership and disposition of the bonds. U.S. Holders The following discussion is a summary of the U.S. federal income tax consequences relevant to a U.S. Holder. S-12 Interest A U.S. Holder generally must include stated interest on a bond as ordinary income at the time such interest is received or accrued, in accordance with such U.S. Holder's method of accounting for U.S. federal income tax puroses. Ifwe call the bonds for redemption (see "Description of the Bonds-optional Redemption"), we may be obligated to make "make-whole" payments on the bonds in excess of stated interest and principaL. We believe, and the following discussion assumes, that the likelihood that we will be obligated to make these additional payments is remote. Remote contingencies are not taken into account unless and until they occur. Our determnation that this contingency is remote is binding on U.S. Holders unless they disclose a contrary position in the manner required by applicable Treasur regulations. Our determination is not, however, binding on the IRS. Assuming our determination is upheld, if we are required to make these additional payments, U.S. Holders would likely recognize additional interest income in accordance with their method of accounting for U.S. federal income tax puroses. Sale or Other Taxable Disposition of the Bonds A US. Holder wil generally recognize gain or loss on the sale, exchange, redemption, retirement or other taxable disposition of a bond equal to the difference between (i) the amount of cash and the fair market value of any propert received upon the disposition (less any amount attbutable to accrued but unpaid interest, which wil be taxable as ordinary income unless previously taken into income) and (ii) the U.S. Holder's adjusted tax basis in the bond. A U.S. Holder's adjusted tax basis in a bond generally wil be the U.S. Holder's purchase price of the bond on the date of purchase. Gain or loss recognized generally wil be a capital gain or loss, and generally will be long-term capital gain or loss if the US. Holder held the bond for more than one year. Long-term capital gains of non- corporate taxpayers are taxed at lower standard rates than those applicable to ordinary income. A U.S. Holder's ability to deduct capital losses may be limited. Non-U.S. Holders The following discussion is a summar of the U.S. federal income tax consequences relevant to a Non-U.s. Holder. Interest Interest paid to a Non-US. Holder generally wil not be subject to US. federal withholding tax, provided that: . the Non~US. Holder does not actully or constrctively own 10% or more of the total combined voting power of all classes of our stock entitled to vote; . the Non-US. Holder is not a controlled foreign corporation that is related to us directly or constrctively through stock ownership; . the Non~US. Holder is not a bank receiving certain types of interest; and . we, or our paying agent, receive appropriate documentation, generally a completed IRS Form W-8BEN, establishing that the Non~U.S. Holder is not a U.S. person within the meaning of the Code. Interest that meets these requirements is referred to as "portfolio interest." The interest on the bonds wil be taxed at regular U.S. federal income tax rates and not be subject to U.S. withholding tax if: (i) the interest constitutes income that is effectively connected with the conduct by a Non-U.S. Holder of a United States trade or business, and (ii) if an income tax treaty applies, the interest is attibutable to a United States permanent establishment of the Non-U.S. Holder under the terms of such treaty ("United States trade or business income"), provided, in each case, that a proper certification is provided. In addition, if the Non-U.S. Holder is a foreign corporation, such income may also be subject to the "branch profits tax" at a rate of 30% (or lower applicable treaty rate). Interest that neither qualifies as portfolio interest nor constitutes United States trde or business income wil be subject to United States withholding tax at the rate of 30%, unless such rate is reduced or eliminated by an applicable tax treaty. S-13 Sale or Other Taxable Disposition of the Bonds Gain realized by a Non-U.S. Holder on the sale, redemption or other disposition of a bond generally will not be subject to U.S. federal income tax, unless (i) such gain is effectively connected with the conduct by such Non-U.S. Holder of a trade or business within the United States (and, if an income tax treaty applies, is attbutable to a permanent establishment in the United States) or (ii) the Non-U.S. Holder is an individual who is present in the United States for 183 days or more in the taxable year of disposition and certin other conditions are satisfied. Gain recognized by a Non-U.S. Holder upon a sale, redemption or other disposition of a bond that is effectively connected with the conduct by the Non-U.S. Holder of a United States trade or business and, if an income tax treaty applies, is attributable to a United States permanent establishment of the Non-U.S. Holder, generally will be subject to U.S. federal income tax in the same manner as if the bond were held by a U.S. Holder. In addition, if the Non- U.S. Holder is a foreign corporation, such gain may also be subject to the branch profits tax at a rate 000% (or lower applicable treaty rate). Information Reporting and Backup Withholding Payments of interest made by us on, or the proceeds of the sale or other disposition of, the bonds may be subject to information reporting and United States federal backup withholding tax, if the recipient of the payment fails to supply an accurate taxpayer identification number or otherwse fails to comply with applicable United States information reportg or certification requirements. Any amount withheld under the backup withholding rues is allowable as a credit against the holder's United States federal income tax, provided that the required information is timely fuished to the IRS. PERSONS CONSIDERING THE PURCHASE OF THE BONDS SHOULD CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE UNITED STATES FEDERAL INCOME TAX CONSEQUENCES OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF BONDS IN LIGHT OF THEIR PARTICULAR CIRCUMSTANCES, AS WELL AS THE EFFECT OF ANY STATE, LOCAL OR FOREIGN TAX LAWS OR ANY APPLICABLE TAX TREATY. S-14 UNDERWRITING We have entered into an underwting agreement with the underwters named below with respect to the bonds. Subject to certin conditions, each underwter has severally agreed to purchase the principal amount of bonds indicated in the following table: Underwriters Lehman Brothers Inc........................................................................" Greenwich Capital Markets, Inc......................................................." J.P. Morgan Securties Inc. .............................................................." Wachovia Capital Markets, LLC ......................................................, Scotia Capital (USA) Inc. .................................................................' Barclays Capital Inc. ........................................................................" BNP Parbas Securities Corp. ......... .......... ............ ...... ......................' Goldman, Sachs & Co. ...................................................................." Banc of America Securties LLC ......................................................, Piper Jaffay & Co.. ..........................................................................' Citigroup Global Markets Inc. .................. .................. ................. ..... Credit Suisse Securities (USA) LLC................................................., SuíiTrust Robinson Humphrey, Inc.................................................." Wedbush Morgan Securities Inc. ....................................................." Wells Fargo Securities, LLC............................................................., Total............................................................................................., Principal Amount of 2018 Bonds $ 72,500,000 72,500,000 72,500,000 72,500,000 40,000,000 27,500,000 27,500,000 27,500,000 12,500,000 12,500,000 12,500,000 12,500,000 12,500,000 12,500,000 $ 12,500,000 $ 500,000,000 Principal Amount of 2038 Bonds $ 43,500,000 43,500,000 43,500,000 43,500,000 24,000,000 16,500,000 16,500,000 16,500,000 7,500,000 7,500,000 7,500,000 7,500,000 7,500,000 7,500,000 $ 7,500,000 $ 300,000,000 The underwting agreement provides that the obligations of the underwiters to purchase the bonds included in this offering are subject to approval oflegal matters by counsel and to other conditions. The underwters ;ire obligated to purchase all the bonds if they purchase any of the bonds. The underwiters propose to offer some ofthe bonds directly to the public at the public offering price set forth on the cover page of this prospectus supplement and some of the bonds to dealers at the public offering price. After the initial offering of the bonds to the public, the underwters may change the public offering price and other sellng term. The bonds are a new issue of securties with no established trding market. We have been advised by the underwters that the underwters intend to make a market in the bonds but are not obligated to do so and may discontinue market making at any time without notice. No assurance can be given as to the liquidity of any trading market for the bonds. In connection with this offering, the underwters may purchase and sell the bonds in the open market. These transactions may include short sales, stabilizing transactions and purchases to cover positions created by short sales. Short sales involve the sale by the underwters of a greater number of bonds than they are required to purchase in the offering. Stabilizing trnsactions consist of certain bids or purchases made for the purose of preventing or retarding a decline in the market price of the bonds while the offering is in progress. The underwters may also impose a penalty bid. This occurs when a particular underwiter repays to the underwters a portion of the underwting discount received by it because another underwiter has repurchased bonds sold by or for the account of such underwter in stabilizing or short covering transactions. These activities by the underwters, as well as other purchases by the underwters for their own accounts, may stabilize, maintain or otherwise affect the market price of the bonds. As a result, the price of the bonds may be higher than the price that otherwse would exist in the open market. If these activities are commenced, they may be discontinued by the underwters at any time. These transactions may be effected in the over-the-counter market or otherwise. S-15 We estimate that our total offering expenses, not including the underwting discount, wil be approximately $575,000. The underwters have agreed to reimburse us for our offering expenses and wil refud a porton of the underwting discount set forth on the cover page of this prospectus supplement. UnionBanc Investment Services LLC, a Financial Industr Regulatory Authority member and subsidiary of Union Bank of Californa, N.A., is being paid a referral fee by Wedbush Morgan Securities Inc. Certain of the underwiters and their affliates have pedormed commercial baning, investment banng and advisory services for us from time to time for which they have received customary fees and expenses. For example, affliates of several of the underwiters act as agents and as lenders under our credit facilties, for which they receive customary fees and expenses. The underwiters may, from time to time, engage in transactions with and pedorm servces for us or our affiliates in the ordinary course of their business. We have agreed to indemnify each ofthe underwters against certin liabilities, including liabilities under the Securities Act of 1933, or to contrbute to payments the underwters may be required to make because of those liabilities. In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a "Relevant Member State"), each underwter has represented and agreed that with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State (the "Relevant Implementation Date") it has not made and wil not make an offer ofthe bonds to the public in that Relevant Member State, except that it may, with effect from and including the Relevant Implementation Date, make an offer of the bonds to the public in that Relevant Member State: (a) to legal entities which are authorised or regulated to operate in the financial markets or, ifnot so authorized or regulated, whose corporate purose is solely to invest in securities; (b) to any legal entity which has two or more of (l) an average of at least 250 employees durng the last financial year; (2) a total balance sheet of more than €43,000,000; and (3) an annual net tuover of more than €50,000,000, as shown in its last annual or consolidated accounts; (c) to fewer than 100 natual or legal persons (other than qualified investors as defined in the Prospectus Directive), subject to obtaining the prior consent of Lehman Brothers Inc., Greenwich Capital Markets, Inc., J.P. Morgan Securties Inc. and Wachovia Capital Markets, LLC; or (d) in any other circumstances fallng within Aricle 3(2) of the Prospectu Directive; provided that no such offer of the Offered Securities shall require us or any underwter to publish a prospectus puruant to Aricle 3 of the Prospectus Directive. For the puroses of this provision, the expression an "offer of bonds to the public" in relation to any bonds in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms ofthe offer and the bonds to be offered so as to enable an investor to decide to purchase or subscribe the bonds, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State, and the expression "Prospectus Directive" means Directive 2003/71/EC and includes any relevant implementing measure in each Relevant Member State. Each underwter has represented and agreed that: (a) it has only communicated or caused to be communicated (and will only communicate or caus to be communicated) an invitation or inducement to engage in investment activity (within the meaning of Section 21 of the Financial Servces & Market Act (the "FSMA")) received by it in connection with the issue or sale ofthe bonds in circumstaces in which Section 21 (l) of the FSMA does not apply to us; and S-16 (b) it has complied and wil comply with all applicable provisions of the FSMA with respect to anyting done by it in relation to the bonds in, from or otherise involving the United Kingdom. The bonds may not be offered or sold by means of any document other than (i) in circumstances which do not constitute an offer to the public within the meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong), or (ii) to "professional investors" within the meaning of the Securties and Futues Ordinance (Cap.571, Laws of Hong Kong) and any rules made thereunder, or (iii) in other circumstances which do not result in the document being a "prospectus" within the meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong), and no advertisement, invitation or document relating to the bonds may be issued or may be in the possession of any person for the purose of issue (in each case whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permtted to do so under the laws of Hong Kong) other than with respect to bonds which are or are intended to be disposed of only to persons outside Hong Kong or only to "professional investors" within the meaning ofthe Securities and Futues Ordinance (Cap. 571, Laws of Hong Kong) and any rues made thereunder. The bonds have not been and wil not be registered under the Securities and Exchange Law of Japan (the "Securities and Exchange Law") and each underwter has agreed that it wil not offer or sell any bonds, directly or indirectly, in Japan or to, or for the benefit of, any resident of Japan (which term as used herein means any person resident in Japan, including any corporation or other entity organized under the laws of Japan), or to others for re- offering or resale, directly or indirectly, in Japan or to a resident of Japan, except pursuant to an exemption from the registrtion requirements of, and otherwise in compliance with, the Securities and Exchange Law and any other applicable laws, regulations and ministerial guidelines of Japan. This prospectus has not been registered as a prospectu with the Monetary Authority of Singapore. Accordingly, this prospectus and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the bonds may not be circulated or distributed, nor may the bonds be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor under Section 274 of the Securties and Futues Act, Chapter 289 of Singapore (the "SF A"), (ii) to a relevant person, or any person puruant to Section 275(1A), and in accordance with the conditions, specified in Section 275 of the SF A or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SF A. Where the bonds are subscribed or purchased under Section 275 by a relevant person which is: (a) a corporation (which is not an accredited investor) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or (b) a trst (where the trustee is not an accredited investor) whose sole purose is to hold investments and each beneficiary is an accredited investor, shares, debentues and units of shares and debentues of that corporation or the beneficiares' rights and interest in that trt shall not be transferable for 6 months after that corporation or that trst has acquired the bonds under Section 275 except: (1) to an institutional investor under Section 274 of the SFA or to a relevant person, or any person pursuant to Section 275(IA), and in accordance with the conditions, specified in Section 275 of the SF A; (2) where no consideration is given for the transfer; or (3) by operation oflaw. S-17 LEGAL MATTERS Certin legal matters with respect to the bonds we are offering wil be passed upon for us by Mark C. Moench, General Counsel ofPacifiCorp, and by Perkis Coie LLP, Portland, Oregon. Certin legal matters will be passed upon for the underwters by Latham & Watkins LLP, New York, New York. Latham & Watkns LLP from time to time represents us and certin of our affiiates. EXPERTS The consolidated financial statements ofPacifiCorp and its subsidiaries as of December 31,2007 and 2006 and for the applicable periods then ended, incorporated in this prospectus supplement by reference from the Form 10-K, have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report (which report expresses all uuqualified opinion and includes an explanatory paragraph relating to the adoption of SF AS No. 158, Employers' Accountingfor Defined Benefit Pension and Other Postretirement Plans-an amendment of FASB Statements No. 87, 88, 106 and 132(R), as of December 3 i, 2006), which is incorporated herein by reference, and has been so incorporated in reliance upon the report of such firm given upon their authority as experts in accounting and auditing. With respect to the unaudited interim financial information for the periods ended March 31, 2007 and 2008, which is incorporated herein by reference, Deloitte & Touche LLP, an independent public accounting firm, has applied limited procedures in accordance with the standards of the Public Company Accounting Oversight Board (United States) for a review of such information. However, as stated in their report included in the Form 10-Q and incorporated by reference herein, they did not audit and they do not express an opinion on that interim financial information. Accordingly, the degree of reliance on their report on such informtion should be restrcted in light of the limited nature of review procedures applied. Deloitte & Touche LLP is not subject to the liabilty provisions of Section 11 of the Securties Act of 1933 for its report on the unaudited interim financial information because that report is not a "report" or a "part" of the registration statement prepared or certified by an accountant within the meaning of Sections 7 and 11 of the Securities Act of 1933. The consolidated statements of income, common shareholder's equity and comprehensive income and of cash flows ofPacifiCorp and its subsidiaries for the year ended March 31, 2006 incorporated in this prospectu supplement by reference to the Form 10-K have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting. S-18 PROSPECTUS PACIFICORP FIRST MORTGAGE BONDS PacifiCorp, an Oregon corporation, may from time to time offer First Mortgage Bonds ("Additional Bonds" or "Securities") in one or more issuaces or series at prices and on terms to be determned at the time of sale. We will provide specific terms of the Securities, including, as applicable, the amount offered, offering prices, interest rates, matuities and redemption or repurchase provisions, in supplements to this prospectus. The supplements may also add, update or change information contained in this prospectus. You should read this prospectus and any supplements carefully before you invest. We may sell the Securties directly through agents designated from time to time or through underwters or dealers. The supplements to this prospectus wil describe the terms of any paricular plan of distrbution, including any underwting arrangements. The "Plan of Distribution" section in this prospectus provides more information on this topic. Investing in our Securities involves risks. See the "Risk Factors" section beginning on page 1 of this prospectus for information on certain matters you should consider before buying our Securities. NEITHER THE SECURTIES AND EXCHANGE COMMISSION NOR ANY STATE SECURTIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURTIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. AN REPRESENTATION TO THE CONTRAY IS A CRIMINAL OFFENSE. This prospectus may not be used to consumate sales of Securties unless accompanied by a prospectu supplement relating to the Securties offered. The date of this prospectu is January 9, 2008. TABLE OF CONTENTS ABOUT THIS PROSPECTUS RISK FACTORS FORWAR-LOOKIG STATEMENTS THE COMPAN CONSOLIDATED RATIOS OF EARINGS TO FIXED CHARGES WHERE YOU CAN FIN MOi&;INFORMATION USE OF PROCEEDS DESCRITION OF ADDITIONAL BONDS BOOK-ENTRY ISSUANCE PLAN OF DISTRIBUTION LEGAL MATTERS EXPERTS We have not authorized anyone to give you any information other than this prospectus and any supplements to this prospectus. You should not assume that the information contained in this prospectus, any prospectus supplement or any document incorporated by reference in this prospectus is accurate as of any date other than the date mentioned on the cover page of those documents. We are not offering to sell the Securties and we are not soliciting offers to buy the Securties in any jurisdiction in which offers are not permtted. ABOUT THIS PROSPECTUS This prospectus is part of a registration statement that PacifiCorp fied with the Securties and Exchange Commission (the "SEC") using the "shelf' registration process. Under this shelf registration process, we may from time to time sell the Securities described in this prospectus in one or more offerings. This prospectu provides a general description of the Securities. Each time we sell Securities, we will provide a prospectu supplement that wil contain specific information about the terms of that offering. That prospectu supplement may include or incorporate by reference a detailed and curent discussion of any risk factors and wil discuss any special considerations applicable to those securities. The prospectus supplement may also add, update or change information contained in this prospectus. You should read both this prospectus and any prospectus supplement together with additional information described under "Where You Can Find More Informtion." Ifthere is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information contained in that prospectus supplement. Unless otherwse indicated or unless the context otherwse requires, in this prospectus, the words "PacifiCorp," "Company," "we," "our" and "us" refer to PacifiCorp, an Oregon corporation, and its subsidiaries. For more detailed information about the Securties, you can read the exhibits to the registration statement. Those exhibits have been either filed with the registration statement or incorporated by reference to earlier SEC fiings listed in the registration statement. See "Where You Can Find More Information." RISK FACTORS Investing in our Securties involves risk. Before purchasing any Securities we offer, you should carefully consider the risk factors described in our periodic report filed with the SEC and the following risk factors related to the Securities, as well as the other information contained in this prospectus, any prospectus supplement and the information incorporated by reference herein in order to evaluate an investment in our Securties. See "Forward- Looking Statements" and "Where You Can Find More Information" in this prospectus. Additional risks and uncertinties that are not yet identified or that we curently believe are immaterial may also materially harm our business, operating results and financial condition and could result in a loss on your investment. We have not appraised the collateral subject to the mortgage securing our Additional Bonds ("Mortgage") and, if there is a default or a foreclosure sale, the value of the collateral may not be suffcient to repay the holders of any Additional Bonds. We have not made any formal appraisal of the value of the collateral subject to the Mortgage, which will secure any Additional Bonds. The value of the collateral in the event ofliquidation wil depend on market and economic conditions, the availability of buyers, the timing of the sale of the collateral and other factors. Although we believe the value of the collateral substantially exceeds the indebtedness under the Additional Bonds and the other first mortgage bonds issued under our Mortgage, we cannot assure you that the proceeds from a sale of all of the collateral would be suffcient to satisfy the amounts outstading under the Additional Bonds and our other first mortgage bonds secured by the same collateral or that such payments would be made in a timely manner. If the proceeds were not suffcient to repay amounts outstanding under the Additional Bonds, then holders of the Additional Bonds, to the extent not repaid from the proceeds of the sale of the collateral, would only have an unsecured claim against our remaining assets. There is no existing market for the Securities, and we cannot assure you that an active trading market for the Securities wil develop. We do not intend to apply for listing ofthe Securties on any securties exchange or automated quotation system. There can be no assurance as to the liquidity of any market that may develop for the Securties. Accordingly, the ability of holders to sell the Securties that they hold or the price at which holders wil be able to sell the Securties may be limited. Futue trading prices of the Securities will depend on many factors, including, among other things, prevailing interest rates, our operating results and the market for similar securties. We do not know whether an active trading market wil develop for the Securties. To the extent that an active trading market does develop, the price at which a holder may be able to sell the Securities that it holds, if at all, may be less than the price paid for them. Consequently, a holder may not be able to liquidate its investment readily, and the Securities may not be readily accepted as collateral for loans. FORWARD-LOOKING STATEMENTS This prospectus, any accompanying prospectus supplement and the additional information described under the heading "Where You Can Find More Informtion" may contain "forward-looking statements" withn the meaning of Section 27A of the Securities Act and Section 2lE of the Exchange Act, which are subject to the safe harbor created by the Private Securties Litigation Reform Act of 1995. All statements other than statements of historical fact are "forward-looking statements" for puroses of these provisions. Examples include discussions as to our expectations, beliefs, plans, goals, objectives and futue financial or other performance or assumptions concerning matters discussed, including through incorporation by reference, in this prospectus. This information, by its natue, involves estimates, projections, forecasts and uncertainties that could cause actual results or outcomes to differ substantially from those expressed in the forward-looking statements found in this prospectus and the documents incorporated by reference in this prospectus. Our business is influenced by many factors that are diffcult to predict, involve uncertinties that may materially affect actual results and are often beyond our ability to control. We have identified a number of these factors in our filings with the SEC, including the Form i O-K, the Form 10-Q and the Form 8-K incorporated by reference in this prospectus, and we refer you to those reports for fuher information. Any forward-looking statement speak only as of the date on which it is made, and we undertke no obligation to update any forward-looking statement to reflect events or circumstances after the date on which it is made. The forward-looking statements in this prospectus and the documents incorporated by reference in this prospectus are qualified in their entirety by the preceding cautionar statements. THE COMPANY Weare a regulated electrcity company serving residential, commercial, industral and other customers in portions of the states of Utah, Oregon, Wyoming, Washington, Idaho and California. We own, or have interests in, a number of thermal, hydroelectric and wind generating plants, as well as electric transmission and distrbution assets. We also buy and sell electricity on the wholesale market with public and private utilities, energy marketing companies and incorporated municipalities. The regulatory commission in each state approves rates for retail electric sales within that state. We are an indirect subsidiar of MidAmerican Energy Holdings Company ("MEHC"). MEHC, a holding company based in Des Moines, Iowa, owning subsidiaries that are principally engaged in energy businesses, is a consolidated subsidiary of Berkshire Hathaway Inc. Our address and telephone number are: PacifiCorp, 825 NE Multnomah, Suite 2000, Portland, Oregon 97232-4116; (503) 813-5000. For additional information concerning our business and affair, including our capital requirements and external financing plans, pending legal and regulatory proceedings (including descriptions of those laws and regulations to which we are subject), prospective purchasers should refer to the documents incorporated by reference into this prospectu, as described in the section entitled "Where You Can Find More Information" and the documents incorporated by reference therein. 2 CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES Nine Months Ended September 30, 2007 3.lx Nine Months Ended December 31, 2006(1) 2.lx Yea Ended Marh 31, 2006 2005 2004 2003~ 2: ~ 1.7x (1) Following the acquisition ofPacifiCorp by MidAmerican Energy Holdings Company on March 21, 2006, we elected to change our fiscal year end from March 31 to December 31, resulting in a nine-month tranition period from April 1, 2006 to December 31, 2006. For puroses of this ratio, fixed charges represent consolidated interest charges, an estimated amount representing the interest factor in rents and preferred dividends of wholly owned subsidiaries. Preferred dividends of wholly owned subsidiaries represents preferred dividends multiplied by the ratio which pre-tax income from continuing operations bears to income from continuing operations. Earnings represent the aggegate of (a) income from continuing operations, (b) taxes based on income from continuing operations, (c) minority interest in the income of majority-owned subsidiaries that have fixed charges, (d) fixed charges and (e) undistrbuted income of less than 50% owned affliates without loan guarantees. 3 WHERE YOU CAN FIN MORE INFORMATION This prospectu is par of a registration statement fied with the SEC. The registrtion statement contains additional information and exhibits not included in this prospectus and refers to documents that are filed as exhibits to other SEC fiings. We fie anual, quaerly and special reports and other information with the SEC. Our SEC fiings are available to the public over the Internet at the SEC's web site at htt://ww.sec.gov. You may also read and copy any document we fie at the SEC's Public Reference Room at 100 F Street, N.E., Room 1580, Washington, D.C. 20549. Please call the SEC at l-800-SEC-0330 for fuer information regarding the public reference rooms. Our SEC filings are also available through the Investor Information section of our website at ww.pacificorp.com. The informtion found on our website, other than any of our SEC fiings that are incorporated by reference herein, is not par of ths prospectu. The SEC allows us to "incorporate by reference" the information we fie with them, which meas that we can disclose importnt information to you by referrng you to those documents. The information incorporated by reference is considered to be part of this prospectus and later information that we file with the SEC wil automatically update or supersede this information. We incorporate by reference the documents listed below and any futue filings made with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Securties Exchange Act of 1934 (the "Exchange Act") (but only to the extent the information therein is filed and not fuished) until all ofthe securities covered by this prospectus have been sold: . Transition Report on Form i O-K for the nine-month period ended December 3 i, 2006. . Quarterly Reports on Form 10-Q for the quarters ended March 31, 2007, June 30, 2007 and September 30, 2007. . Curent Reports on Form 8-K fied March 12,2007, March 14,2007, June 4,2007, July 30,2007, August 30,2007, August 31,2007 and October 3, 2007. You may request a copy of these fiings (other than exhibits to such documents unless such exhibits are specifically incorporated by reference herein), at no cost, by writing or telephoning us at the following address: PacifiCorp 825 NE Multnomah, Suite 1900 Portland, Oregon 97232-4 i 16 Telephone: (503) 813-5000 Attention: Treasur You should rely only on the information contained in, or incorporated by reference in, this prospectus and the prospectus supplement. We have not, and any underwters, agents or dealers have not, authorized anyone else to provide you with different information. Weare not, and any underwiters, agents or dealers are not, making an offer of these Securties in any state where the offer or sale is not permtted. You should not assume that the informtion contained in this prospectu and the prospectus supplement is accurate as of any date other than the date on the front of the prospectus supplement or that the information incorporated by reference in this prospectus is accurte as of any date other than the date on the front of those documents. 4 USE OF PROCEEDS Unless otherwse indicated in a prospectus supplement, the net proceeds to be received by us from the issuance and sale ofthe Securties will initially become part of our general fuds and will be used to repay all or a portion of our short-term borrowings outstanding at the time of issuance of the Securties or may be applied to utilty asset purchases, capital expenditues or other corporate puroses, including the refuding oflong-term debt. 5 DESCRIPTION OF ADDITIONAL BONDS General Additional Bonds may be issued from time to time under our Mortgage and Deed of Trust, dated as of January 9,1989, as amended and supplemented (the "Mortgage"), with The Ban of New York (as successor trtee to JPMorgan Chase Ban, N.A.) (the "Mortgage Trutee"). The following sumary is subject to the provisions of and is qualified by reference to the Mortgage, a copy of which is an exhibit to the Registration Statement. Whenever paricular provisions or defined terms in the Mortgage are referred to herein, those provisions or defined term are incorporated by reference herein. Section and Aricle references used below are references to provisions of the Mortgage uness otherwse noted. When we refer to "bonds," we refer to all first mortgage bonds issued under the Mortgage, including the Additional Bonds. We expect to issue Additional Bonds in the form of fully registered bonds and, except as may be set forth in any prospectus supplement relating to those Additional Bonds, in denominations of $1 ,000 and any multiple thereof. They may be transferred without charge, other than for applicable taes or other governental charges, at the offces of the Mortgage Trustee, New York, New York. Any Additional Bonds issued wil be equally and ratably secured with all other bonds issued under the Mortgage. See "Book-Entr Issuance." Maturity and Interest Payments Reference is made to the prospectu supplement relating to any Additional Bonds for the date or dates on which those Additional Bonds will matue, the rate or rates per annum at which those Additional Bonds will bear interest and the times at which any interest wil be payable. These term and conditions, as well as the terms and conditions relating to redemption and purchase referred to under "-Redemption or Purchase of Additional Bonds" below, will be as established in or pursuant to resolutions of our Board of Directors at the time of issuace of the Additional Bonds. Redemption or Purchase of Additional Bonds The Additional Bonds may be redeemable, in whole or in part, on not less than 30 days' notice either at our option or as required by the Mortgage or may be subject to repurchase at the option ofthe holder. Reference is made to the prospectus supplement relating to any Additional Bonds for the redemption or repurchase terms and other specific terms of those Additional Bonds. If, at the time notice of redemption is given, the redemption moneys are not held by the Mortgage Trustee, the redemption may be made subject to their receipt on or before the date fixed for redemption and that notice shall be of no effect unless those moneys are so received. While the Mortgage, as described below, contains provisions for the maintenance of the Mortaged and Pledged Propert, the Mortgage does not permt redemption of bonds pursuant to these provisions. There is no sinkng or analogous fud in the Mortgage. Cash deposited under any provisions of the Mortgage may be applied (with specific exceptions) to the redemption or repurchase of bonds of any series. (Section 7.03, Aricle XII and Section 13.06) Security and Priority The Additional Bonds wil be issued under the Mortgage and secured by a first mortgage lien on certin utility propert owned from time to time by us and/or by Class "A" Bonds, if any, held by the Mortgage Trustee. 6 There are excepted from the lien of the Mortgage all cash and securties (except those specifically deposited); equipment, materials or supplies held for sale or other disposition; any fuel and similar consumable materials and supplies; automobiles, other vehicles, aircraft and vessels; timber, minerals, mineral rights and royalties; receivables, contracts, leases and operating agreements; electrc energy, gas, water, steam and other products for sale, distrbution or other use; natual gas wells; gas transporttion lines or other propert used in the sale of natual gas to customers or to a natual gas distribution or pipeline company, up to the point of connection with any distrbution system; our interest in the Wyodak Facility; and all properties that have been released from the discharged Mortgages and Deeds of Trust, as supplemented, of Pacific Power & Light Company and Utah Power & Light Company and that PacifiCorp, a Maine corporation, or Utah Power & Light Company, a Uta corporation, contracted to dispose of, but title to which had not passed at the date of the Mortgage. The lien of the Mortgage is also subject to Excepted Encumbrances, including tax and constrction liens, purchase money liens and other specific exceptions. We have reserved the right, without any consent or other action by holders of bonds of the Ninth Series or any subsequently created series of bonds, to amend the Mortgage in order to except from the lien of the Mortgage allowances allocated to steam-electrc generating plants owned by us, or in which we have interests, pursuant to Title iv of the Clean Air Act Amendments of 1990, as now in effect or as hereafter supplemented or amended. The Mortgage contains provisions subjecting after-acquired propert to the lien thereof. These provisions may be limited, at our option, in the case of consolidation or merger (whether or not we are the suriving corporation), conveyance or transfer of all or substantially all of the utilty propert of another electrc utility company to us or sale of substantially all of our assets. (Section i 8.03) In addition, after-acquired propert may be subject to a Class "A" Mortgage, purchase money mortgages and other liens or defects in title. The Mortgage provides that the Mortgage Trustee shall have a lien upon the mortgaged propert, prior to the holders of bonds, for the payment of its reasonable compensation and expenses and for indenmity against certin liabilities. (Section 19.09) Issuance of Additional Bonds The maximum principal amount of bonds that may be issued under the Mortgage is not limited. Bonds of any series may be issued from time to time on the basis of: (1) 70% of qualified Propert Additions after adjustments to offset retirements; (2) Class "A" Bonds (which need not bear interest) delivered to the Mortgage Trustee; (3) retirement of bonds or certin prior lien bonds; and/or (4) deposits of cash. With certin exceptions in the case of clauses (2) and (3) above, the issuance of bonds is subject to our Adjusted Net Earnngs for 12 consecutive months out of the preceding 15 months, before income taxes, being at least twice the Anual Interest Requirements on all bonds at the time outstanding, all outstanding Class "A" Bonds held other than by the Mortgage Trustee or by us, and all other indebtedness secured by a lien prior to the lien of the Mortgage. In general, interest on variable interest bonds, if any, is calculated using the rate then in effect. (Section 1.07 and Aricles iv through Vii) 7 Propert Additions generally include electrc, gas, steam and/or hot water utility propert but not fuel, securties, automobiles, other vehicles or aircraft, or propert used principally for the production or gathering of natual gas. (Section 1.04) The issuance of bonds on the basis of Propert Additions subject to prior liens is restrcted. Bonds may, however, be issued against the deposit of Class "A" Bonds. (Sections 1.04 through 1.06 and Aricles iv and V) Release and Substitution of Property Propert subject to the lien of the Mortgage may be released upon the basis of: (l) the release of that propert from the lien of a Class "A" Mortgage; (2) the deposit of cash or, to a limited extent, purchase money mortgages; (3) Propert Additions, after making adjustments for certin prior lien bonds outstanding against Propert Additions; and/or (4) waiver of the right to issue bonds. Cash may be withdrawn upon the bases stated in (1), (3) and (4) above. Propert that does not constitute Funded Propert, as defined in Section 1.05 of the Mortgage, may be released without substituting other Funded Propert. Similar provisions are in effect as to cash proceeds from such propert. The Mortgage contains special provisions with respect to certin prior lien bonds deposited and disposition of moneys received on deposited prior lien bonds. (Sections 1.05, 7.02, 9.05, 10.01 through 10.04 and 13.03 though 13.09) Merger or Consolidation The Mortgage provides that in the event of the merger or consolidation of another company with or into us or the conveyance or transfer to us by another company of all or substantially all of that company's propert that is of the same charcter as Propert Additions, as defined in the Mortgage, an existing mortgage constituting a first lien on operating properties of that other company may be designated by us as a Class "A" Mortgage. (Section 11.06) Bonds thereafter issued pursuant to the additional mortgage would be Class "A" Bonds and could provide the basis for the issuance of bonds under the Mortgage. Certain Covenants The Mortgage contains a number of covenants by us for the benefit of the holders of the bonds, including provisions requiring us to maintain the mortgaged propert as an operating system or systems capable of engaging in all or any of the generating, transmission, distrbution or other utility businesses described in the Mortgage. (Aricle iX) Dividend Restrictions The Mortgage provides that we may not declare or pay dividends (other than dividends payable solely in shares of our common stock) on any shares of our common stock if, after giving effect to the declaration or payment, we would not be able to pay our debts as they become due in the usual course of business. (Section 9.07) Reference is made to the notes to the audited consolidated financial statements included in our Transition Report on Form 10-K incorporated by reference herein for information relating to other restrictions. 8 Foreign Currency Denominated Bonds The Mortgage authorizes the issuance of bonds denominated in foreign curencies, provided that we deposit with the Mortgage Trustee a curency exchange agreement with an entity having, at the time of the deposit, a financial rating at least as high as our financial rating that, in the opinion of an independent expert, gives us at least as much protection against curency exchange fluctution as is usually obtained by similarly situted borrowers. (Section 2.03) We believe that this tye of curency exchange agreement wil provide effective protection against curency exchange fluctuations. However, if the other par to the exchange agreement defaults and the foreign curency is valued higher at the date of matuty than at the date of issuance of the relevant bonds, holders of those bonds would have a claim on our assets that is greater than the claim to which holders of dollar-denominated bonds issued at the same time would be entitled. The Mortgage Trustee The Ban of New York may act as a lender, trstee or agent under other agreements and indentues involving us and our affliates. Modification The rights of bondholders may be modified with the consent of holders of at least 60% ofthe bonds, or, if less than all series of bonds are adversely affected, the consent of the holders of at least 60% of the series of bonds adversely affected. In general, no modification of the terms of payment of principal, premium, if any, or interest and no modification affecting the lien or reducing the percentage required for modification is effective against any bondholder without the consent of the holder. (Section 21.07) Unless we are in default in the payment ofthe interest on any bonds then Outstanding under the Mortgage or there is a Default under the Mortgage, the Mortgage Trustee generally is required to vote Class "A" bonds held by it with respect to any amendment of the applicable Class "A" Mortgage proportionately with the vote of the holders of all Class "A" Bonds then actually voting. (Section 11.03) Defaults and Notice Thereof "Defaults" are defined in the Mortgage as: (1 ) default in payment of principal; (2) default for 60 days in payment of interest or an installment of any fud required to be applied to the purchase or redemption of any bonds; (3) default in payment of principal or interest with respect to certin prior lien bonds; (4) certin events in bankrptcy, insolvency or reorganization; (5) default in other covenants for 90 days after notice; or (6) the existence of any default under a Class "A" Mortgage that permts the declaration of the principal of all the bonds secured by the Class "A" Mortgage and the interest accrued thereupon due and payable. (Section 15.01) An effective default under any Class "A" Mortgage or under the Mortgage wil result in an effective default under all those mortgages. The Mortgage Trutee may withhold notice of default (except in payment of principal, interest or fuds for retirement of bonds) if it determines that it is not detrmental to the interests ofthe bondholders. (Section 15.02) 9 The Mortgage Trustee or the holders of 25% of the bonds may declare the principal and interest due and payable on Default, but a majority may annul the declaration if the Default has been cured. (Section 15.03) No holder of bonds may enforce the lien of the Mortgage without giving the Mortgage Trustee wrtten notice of a Default and unless the holders of25% of the bonds have requested in wrting the Mortgage Trutee to act and offered it reasonable opportity to act and indemnity satisfactory to it against the costs, expenses and liabilties to be incured thereby and the Mortgage Trustee shall have failed to act. (Section 15.16) The holders ofa majority of the bonds may direct the time, method and place of conducting any proceedings for any remedy available to the Mortgage Trustee or exercising any trst or power conferred on the Mortgage Trustee. (Section 15.07) The Mortgage Trustee is not required to risk its fuds or incur personal liabilty if there is reasonable ground for believing that repayment is not reasonably assured. (Section 19.08) Defeasance Under the terms of the Mortgage, we wil be discharged from any and all obligations under the Mortgage in respect of the bonds of any series if we deposit with the Mortgage Trustee, in trst, moneys or governent obligations, in an amount sufficient to pay all the principal of, premium (if any) and interest on, the bonds of those series or portions thereof, on the redemption date or matuity date thereof, as the case may be. The Mortgage Trutee need not accept the deposit unless it is accompanied by an opinion of counsel to the effect that (a) we have received from, or there has been published by, the Internal Revenue Service a ruling or, (b) since the date of the Mortgage, there has been a change in applicable federal income tax law, in either case to the effect that, and based thereon the opinion of counsel shall confirm that, the holders of the bonds or the right of payment of interest thereon (as the case may be) wil not recognze income, gain or loss for federal income tax puroses as a result of the deposit, and/or ensuing discharge and will be subject to federal income tax on the same amount and in the same maner and at the same times, as would have been the case if the deposit, and/or discharge had not occured. (Section 20.02) Upon the deposit, our obligation to pay the principal of (and premium, if any) and interest on those bonds shall cease, termnate and be completely discharged and the holders of such bonds shall thereafter be entitled to receive payment solely from the funds deposited. (Section 20.02) 10 BOOK-ENTRY ISSUANCE Unless otherwse specified in the applicable prospectus supplement, The Depository Trut Company ("DTC") will act as securties depositary for each series of the Additional Bonds. The Additional Bonds will be issued as fully registered securities registered in the name of Cede & Co. (DTC's parership nominee) or such other name as may be requested by an authorized representative ofDTC. One fully registered certificate will be issued for each issue of the Additional Bonds, representing the aggregate principal amount of each series of Additional Bonds, and will be deposited with DTC. If, however, the aggregate principal amount of any issue exceeds $500,000,000, one certificate wil be issued with respect to each $500,000,000 of principal amount, and an additional certificate wil be issued with respect to any remaining principal amount of such issue. DTC is a limited-purose trst company organized under the New York Bankng Law, a "bankng organization" within the meaning of the New York Baning Law, a member of the Federal Reserve System, a "clearing corporation" withn the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered puruant to the provisions of Section 17 A of the Exchange Act. DTC holds securties that its paricipants ("Direct Paricipants") deposit with DTC. DTC also facilitates the post-trde settlement among Direct Paricipants of sales and other securties transactions, such as transfers and pledges, in deposited securities through electronic computerized book-entr transfers and pledges between Direct Participants' accounts, thereby eliminating the need for physical movement of securties certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trst companies, clearing corporations and some other organizations. DTC is a wholly owned subsidiary of The Depository Trust & Clearing Corporation ("DTCC"), which, in tu, is owned by a number of Direct Participants ofDTC and Members ofthe National Securities Clearng Corporation, Fixed Income Clearing Corporation and Emerging Markets Clearng Corporation (NSCC, FICC and EMCC, also subsidiares ofDTCC), as well as by the New York Stock Exchange, Inc., the American Stock Exchange LLC, and the National Association of Securties Dealers, Inc. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trst companies, and clearing corporations that clear though or maintain a custodial relationship with a Direct Paricipant, either directly or indirectly ("Indirect Partcipants," and together with Direct Participants, "Participants"). DTC has Standard & Poor's highest rating: AA. The DTC Rules applicable to its Participants are on fie with the SEC. More information about DTC can be found at ww.dtcc.com. Purchases of Additional Bonds within the DTC system must be made by or through Direct Paricipants, which wil receive a credit for the Additional Bonds on DTC's records. The ownership interest of each actul purchaser of each Additional Bond ("Beneficial Owner") is in tu to be recorded on the Direct and Indirect Participants' records. Beneficial Owners wil not receive wrtten confirmation from DTC of their purchases, but Beneficial Owners are expected to receive wrtten confirmations providing details of the trnsactions, as well as periodic statements oftheir holdings, from the Direct or Indirect Participants through which the Beneficial Owners entered into the transaction. Transfers of ownership interests in the Additional Bonds are to be accomplished by entres made on the books of Paricipants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Additional Bonds, except in the event that use of the book-entr system for the Additional Bonds is discontinued. To facilitate subsequent transfers, all Additional Bonds deposited by Direct Paricipants with DTC are registered in the name ofDTC's partership nominee, Cede & Co., or such other name as may be requested by an authorized representative ofDTC. The deposit of Additional Bonds with DTC and their registrtion in the name of Cede & Co. or such other DTC nominee does not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Additional Bonds; DTC's records reflect only the identity of the Direct Paricipants to whose accounts those Additional Bonds are credited, which mayor may not be the Beneficial Owners. The Participants wil remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners wil be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of Additional Bonds may wish to take certain steps to augment transmission to them of notices of significant events with respect to the Securities, such as redemptions, tenders, defaults, and propose amendments to 11 the security documents. For example, Beneficial Owners of Additional Bonds may wish to ascertain that the nominee holding the Additional Bonds for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of the notices be provided directly to them. Redemption notices shall be sent to Cede & Co. as the registered holder of the Additional Bonds. Ifless than all of the Additional Bonds are being redeemed, DTC's practice is to determne by lot the amount of the interest of each Direct Participant in such issue. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Additional Bonds unless authorized by a Direct Participant in accordance with DTC's procedures. Under its usual procedurs, DTC mails an omnibus proxy (the "Omnibus Proxy") to the Mortgage Trustee after the record date. The Omnibus Proxy assigns Cede & Co.' s consenting or voting rights to those Direct Parcipants to whose accounts those Additional Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy). Payments on the Additional Bonds wil be made by the Mortgage Trutee to Cede & Co. or such other nominee as may be requested by an authorized representative ofDTC. DTC's practice is to credit Direct Participants' accounts upon DTC's receipt of funds and corresponding detail information on payable date in accordance with their respective holdings shown on DTC's records. Payments by Participants to Beneficial Owners wil be governed by standing instrctions and customary practices and wil be the responsibilty of the Paricipant and not ofDTC (or its nominee), the Mortgage Trustee or us, subject to any statutory or regulatory requirements as may be in effect from time to time. Payments on the Additional Bonds are the responsibility of the Mortgage Trustee disbursement of the payments to Direct Participants is the responsibility ofDTC, and disbursements of the payments to the Beneficial Owners is the responsibilty of Direct and Indirect Paricipants. DTC may discontinue providing its servces as depository with respect to the Additional Bonds at any time by giving reasonable notice to us or to the Mortgage Trustee. Under such circumstances, in the event that a successor depositary is not obtained, Additional Bond certificates are required to be printed and delivered. We may decide to discontinue use ofthe system ofbook~entry only trnsfers through DTC or any successor deposita. In that event, Additional Bond certificates will be printed and delivered to DTC. The information in this section concerning DTC and DTC's book-entr system has been obtained from sources that we believe to be accurate, but we assume no responsibility for the accurcy thereof. We have no responsibilty for the performance by DTC or its Participants of their respective obligations as described herein or under the rules and procedures governing their respective operations. 12 PLAN OF DISTRIBUTION We may sell the Securties though underwters, dealers or agents, or directly to one or more purchasers. The prospectus supplement with respect to the Securties being offered will set fort the specific terms of the offering of those Securities, including the name or names of any underwters, dealers or agents, the purchase price of those Securties and the proceeds to us from the sale, any underwting discounts, agency fees and other items constituting underwiters' or agents' compensation, any initial public offering price and any discounts or concessions allowed or reallowed or paid to dealers. Ifwe use underwters to sell Securties, we wil enter into an underwiting agreement with the underwiters. Those Securties will be acquired by the underwiters for their own account and may be resold from time to time in one or more transactions, at a fixed public offering price, at market prices prevailng at the time of sale, at prices related to such prevailing market prices or at negotiated prices. The underwter or underwters with respect to a particular underwtten offering of Securities wil be named in the prospectus supplement relating to that offering and, if an underwiting syndicate is used, the managing underwter or underwters wil be set forth on the cover page of the prospectus supplement. Any underwting compensation paid by us to the underwiters or agents in connection with an offering of Securities, and any discounts, concessions or commissions allowed by underwiters to dealers, wil be set fort in the applicable prospectus supplement to the extent required by applicable law. Unless otherwise set fort in the prospectus supplement, the obligations of the underwiters to purchase the Securities will be subject to specific conditions, and the underwters wil be obligated to purchase all of the offered Securties if any are purchased. If a dealer is used in the sale of any Securties, we will sell those Securties to the dealer, as pricipaL. The dealer may then resell the Securities to the public at varyng prices to be determined by the dealer at the time of resale. The name of any dealer involved in a particular offering of Securties and any discounts or concessions allowed or reallowed or paid to the dealer will be set forth in the prospectus supplement relating to that offering. The Securties may be sold directly by us or though agents designated by us from time to time. We wil describe the terms of any direct sales in a prospectus supplement. Any agent, who may be deemed to be an underwiter as that term is defined in the Securties Act of 1933 (the "Securities Act"), involved in the offer or sale of any of the Securities wil be named, and any commissions payable by us to the agent wil be set fort, in the prospectus supplement relating to that pffer or sale. Unless otherwse indicated in the prospectus supplement, any agent wil be acting on a reasonable best effort basis for the period of its appointment. If so indicated in an applicable prospectus supplement, we wil authorize dealers acting as our agents to solicit offers by certain specified institutions to purchase Securties from us at the public offerig price set forth in the prospectus supplement pursuant to delayed delivery contracts ("Contracts") providing for payment and delivery on a specified date or dates in the futue. Each Contrct wil be for an amount not less than, and the aggregate principal amount of Securities sold pursuant to Contracts shall be not less nor more than, the respective amounts stated in the prospectus supplement. Institutions with whom Contracts, when authorized, may be made include commercial and savings banks, insurance companies, pension funds, investment companies, educational and chartable institutions and other institutions, but wil in allcases be subject to our approval. Contracts wil not be subject to any conditions except (i) the purchase by an institution of the Securties covered by its Contracts shall not at the time of delivery be prohibited under the laws of any jursdiction in the United States to which the institution is subject, and (ii) if the Securties are being sold to underwters, we shall have sold to those underwters the total principal amount of the Securities less the principal amount thereof covered by Contracts. Agents and underwters wil have no responsibility in respect of the delivery or performance of Contracts. In connection with a particular underwitten offerig of Securities, the underwiters may engage in transactions that stabilize, maintain or otherwise affect the prices of the classes or series of Securties offered, including stabilzing transactions and syndicate covering transactions. A description of these activities, ifany, wil be set fort in the prospectus supplement relating to that offerig. Underwiters, dealers or agents and their associates may be customers of, engage in transactions with or 13 pedorm services for us and our affliates in the ordinary course of business. We will indicate in a prospectu supplement the extent to which we anticipate that a secondar market for the Securities will be available. Unless we inform you otherwise in a prospectus supplement, we do not intend to apply for the listing of any series of the Securities on a national securties exchange. If the Securties of any series are sold to or though underwiters, the underwiters may make a market in such Securties, as permtted by applicable laws and regulations. No underwiter would be obligated, however, to make a market in the Securties, and any market-makng could be discontinued at any time at the sole discretion of the underwiters. Accordingly, we canot assure you as to the liquidity of, or trading markets for, the Securties of any series. Underwiters, dealers and agents paricipating in the distrbution of the Securties may be deemed to be "underwiters" within the meaning of, and any discounts and commissions received by them and any profit realized by them on resale of those Securties may be deemed to be underwting discounts and commissions under, the Securities Act. Subject to some conditions, we may agree to indemnify the several underwters, dealers or agents and their controlling persons against specific civil liabilities, including liabilities under the Securties Act, or to contribute to payments that person may be required to make in respect thereof. Durng such time as we may be engaged in a distrbution of the securties covered by this prospectus we are required to comply with Regulation M promulgated under the Exchange Act. With certin exceptions, Regulation M precludes us, any affliated purchasers and any broker-dealer or other person who paricipates in such distrbuting from bidding for or purchasing, or attempting to induce any person to bid for or purchase, any securty which is the subject of the distrbution until the entire distrbution is complete. Regulation M also restrcts bids or purchases made in order to stabilize the price of a securty in connection with the distrbution of that security. All of the foregoing may affect the marketability of our securties. 14 LEGAL MATTERS The validity of the Securties wil be passed upon for us by Perkins Coie LLP, counsel to the Company, 1120 N.W. Couch Street, Tenth Floor, Portland, Oregon 97209. EXPERTS The consolidated financial statements as of December 31, 2006 and for the nine-month period then ended, incorporated in this prospectus by reference from our Transition Report on Form 10-K for the trnsition period from April 1, 2006 to December 31, 2006, have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report (which report expresses an unqualified opinion and includes an explanatory paragraph relating to the adoption of SF AS No. 158, Employers' Accountingfor Defined Benefit Pension and Other Postretirement Plans-an amendment ofFASB Statements No. 87, 88, 106 and 132(R), as of December 31, 2006), which is incorporated herein by reference, and has been so incorporated in reliance upon the report of such firm given upon their authority as experts in accounting and auditing. With respect to the unaudited interim financial information for the periods ended March 31, 2007, June 30, 2007 and 2006, and September 30, 2007 and 2006, which are incorporated herein by reference, Deloitte & Touche LLP, an independent public accounting firm, has applied limited procedures in accordace with the standards of the Public Company Accounting Oversight Board (United States) for a review of such information. However, as stated in their reports included in our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2007, June 30, 2007 and September 30, 2007 and incorported by reference herein, they did not audit and they do not express an opinion on that interim financial information. Accordingly, the degree of reliance on their report on such information should be restrcted in light of the limited natu of review procedures applied. Deloitte & Touche LLP is not subject to the liabilty provisions of Section 11 of the Securties Act of 1933 for its reports on the unaudited interim financial information because those reports are not "reports" or a "par" of the registrtion statement prepared or certified by an accountant within the meaning of Sections 7 and 11 of the Securties Act of 1933. The consolidated financial statements as of March 31, 2006 and for each of the two years in the period ended March 31, 2006 incorporated in this prospectus by reference to the Transition Report on Form lO-K for the transition period from April 1, 2006 to December 31, 2006 have been so incorporated in reliance upon the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting. 15 EXECUTON COPY PACIFICORP $500,000,000 First Mortgage Bonds 5.650% Series Due 2018 $300,000,000 First Mortgage Bonds 6.350% Series Due 2038 UNDERWRITING AGREEMENT July 14,2008 LEHMAN BROTHERS INC. GREENWCH CAPITAL MARKTS, INC. J.P. MORGAN SECURITIES INC. WACHOVIA CAPITAL MARKTS, LLC As Representatives (the "Representatives") of the several Underwiters listed In Schedule A hereto c/o LEHMAN BROTHERS INC. 745 Seventh Avenue New York, NY 10019 Dear Sirs: 1. Introductory. PacifiCorp, an Oregon corporation (the "Company"), proposes, subject to the terms and conditions stated herein, to issue and sell to the several underwters listed in Schedule A hereto (the "Underwriters"), (i) U.S. $500,000,000 principal amount of its First Mortgage Bonds, 5.650% Series due 2018 (the "2018 Bonds"), and (ii) U.S. $300,000,000 principal amount of its First Mortgage Bonds, 6.350% Series due 2038 (the "2038 Bonds" and, together with the 2018 Bonds, the "Offered Securities"), in each case to be issued under that certain Mortgage Deed and Trust, dated as of January 9, 1989, with The Bank of New York Mellon Trust Company, N .A., as successor trstee (the "Trustee"), as heretofore amended and supplemented by the supplemental indentus thereto and as fuher amended and supplemented by a supplemental indentue to be dated July 1, 2008 (collectively, the "Mortgage") pursuant to the registration statement on Form S-3 (File No. 333-148662) filed on January 9, 2008, as amended to date (the "Initial Registration Statement"). The Mortgage has been qualified under the Trust Indentue Act of 1939, as amended (the "Trust Indenture Act"), and the rules and regulations of the Securities and Exchange Commission (the "Commission") under the Trust Indenture Act. The United States Securties Act of 1933, as amended, is herein referred to as the "Securities Act," and the rules and regulations of the Commission thereunder are herein referrd to as the "Rules and Regulations." The Company hereby agrees with the several Underwriters as follows: 2. Representations and Warranties of the Company. The Company represents and warants to, and agrees with, the several Underwriters that: NY\1389508.7 (a) The Initial Registration Statement in respect of the Offered Securties has been fied with the Commssion; the Initial Registration Statement and any post-effective amendments thereto prior to the date hereof, each in the form heretofore delivered or to be delivered to the Underters and, excluding exhibits to the Initial Registration Statement but including all documents incorporated by reference in the prospectus contained in such Initial Registration Statement, including any prospectus supplement relating to the Offered Securties that is fied with the Commission and deemed by virte of Rule 430B under the Securties Act to be par of the Initial Registration Statement, has been declared effective by the Commission in such form; other than a registration statement, if any, increasing the size of the offering (a "Rule 462(b) Registration Statement," together with the Initial Registration Statement, the "Registration Statement"), fied pursuant to Rule 462(b) under the Securities Act, which, if so fied, became effective upon filing, and no other document with respect to the Initial Registrtion Statement or any document incorporated by reference therein has heretofore been fied or transmitted for fiing with the Commission with respect to the offering contemplated by the Initial Registration Statement (other than documents filed after the fiing date of the Initial Registration Statement under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and prospectuses fied pursuant to Rule 424(b) of the Rules and Regulations, each in the form heretofore delivered to the Underwters); and no stop order suspending the effectiveness of the Initial Registration Statement, any post-effective amendment thereto or the Rule 462(b) Registrtion Statement, if any, has been issued and no proceeding for that purpose has been initiated or theatened by the Commission. (b) A preliminary prospectus and a final prospectus relating to the Offered Securties to be offered by the Underwters have been prepared by the Company. Such preliminary prospectus (including the documents incorporated by reference therein) is hereinafter referred to as, the "Preliminary Prospectus"; such form of final prospectus relating to the Offered Securties fied with the Commission puruant to Rule 424(b) under the Securities Act (including the documents incorporated by reference therein) is hereinafter referred to as the "Prospectus." The Preliminary Prospectus, as amended or supplemented as of the Applicable Time (as defined below), when considered together with the final term sheet fied pursuant to Section 5(a) hereof, (the "Disclosure Package") as of the Applicable Time did not include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The Prospectus, as of its date and as of the Closing Date (as defined below), did not and wil not include any untre statement of a material fact or omit to state any material fact necessar in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; and each Issuer Free Writing Prospectus (as defined in Rule 433 under the Securities Act) listed on Schedule B(ii) hereto does not conflct with the information contained in the Registration Statement, the Preliminary Prospectus or the Prospectus and each such Issuer Free Writing Prospectus, as supplemented by and taken together with the Disclosure Package as of the Applicable Time, did not include any untre statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, the preceding two sentences do not apply to statements in or omissions from the Preliminary Prospectus, the Disclosure Package, the Prospectus or any Issuer Free Writing Prospectus based upon wrtten information fuished to the Company by the Underwters specifically for use therein, it being understood and agred that the only such information is that described as such in Section 7(b) hereof. For purposes of this Agreement, the "Applicable Time" is 2:00 p.m., New York City Time, on the date of this Agreement. 2 NY\1389508.7 At the earliest time after the fiing of the Initial Registration Statement that the Company or another offering participant made a bonafide offer (within the meaning of Rule l64(h)(2) under the Act) of the Offered Securities, the Company was not an "ineligible issuer" as defined in Rule 405 under the Securties Act. (c) The Registration Statement and the Prospectus conform, and any fuer amendments or supplements to the Registration Statement or the Prospectus when made wil conform, in all material respects to the requirements of the Securities Act and the Rules and Regulations and the Registrtion Statement conforms, and any fuer amendments or supplements to the Registration Statement when made wil conform, in all material respects to the requirements of the Trust Indentue Act, and the rules and regulations of the Commission thereunder. The Registration Statement as of the applicable Effective Date and any amendments thereto as of the Closing Date does not and wil not contain an untre statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, and the Prospectus as of its date as amended or supplemented as of the Closing Date does not and wil not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. (d) The Company has been duly incorporated and is validly existing as a corporation under the laws of the State of Oregon with corporate power and corporate authority (i) to own its properties and conduct its business as described in the Disclosure Package and the Prospectus and (ii) to execute and deliver, and perform its obligations under, this Agreement, the Mortgage and the Offered Securties; and the Company is duly qualified as a foreign corporation to transact business and is in good standing in each jursdiction in which it owns or leases substatial properties or in which the conduct of its business requires such qualification, except where the failure to so qualify would not have a material adverse effect on the financial condition, business or results of operations of the Company and its subsidiaries taken as a whole (a "Material Adverse Effect"). (e) The Mortgage has been duly authorized, executed and delivered by the Company, and constitutes a valid and legally binding instrent of the Company enforceable against the Company in accordance with its terms, except as limited by banptcy, insolvency, fraudulent conveyance, reorganization and other similar laws relating to or affecting creditors' rights generally and general equitable principles (whether considered in a proceeding in equity or at law); and the Mortgage conforms to the description thereof in the Disclosure Package and the Prospectus. (f) The Offered Securties have been duly authorized by the Company and, when authenticated and delivered in accordance with the Mortgage and paid for by the purchasers thereof, wil constitute valid and legally binding obligations of the Company enforceable against the Company in accordance with their terms, except as limited by bankptcy, insolvency, fraudulent conveyance, reorganization and other similar laws relating to or affecting creditors' rights generally and general equitable principles (whether considered in a proceeding in equity or at law), and wil be entitled to the benefit of the security afforded by the Mortgage; and the Offered Securities conform to the description thereof in the Disclosure Package and the Prospectus. (g) No consent, approval, authorization or order of, or filing or registrtion. by the Company with, any cour, governental agency or third part is required for the consummation of the transactions contemplated by this Agreement and the Mortgage in connection with the 3 NY\1389508.7 issuance and sale of the Offered Securities by the Company and the use of the proceeds of the offering of the Offered Securties as described in the Disclosure Package and the Prospectus, except such as have been obtained or made. (h) This Agreement has been duly authorized, executed and delivered by the Company and is a valid and legally binding agreement of the Company enforceable against the Company in accordance with its terms, except as limited by banptcy, insolvency, fraudulent conveyance, reorganization and other similar laws relating to or affecting creditors' rights generally and general equitable principles (whether considered in a proceeding in equity or at law) and subject to any principles of public policy limiting the right to enforce the indemnification and contribution provisions contained herein. (i) Except as disclosed in the Disclosure Package and the Prospectus, the Company has good and suffcient title to all the properties described as owned or leased by it (the "Properties"), subject to minor defects and irregularities customarily found in properties of like size and character that do not materially impair the use of the propert affected thereby in the operation of the business of the Company. G) The Company is not in violation of (i) the Aricles of Incorporation (the "Articles") or its Bylaws, as amended, or in default in the performance or observance of any material obligation, covenant or condition contained in any contrct, agreement or other instrment to which it is a par or by which it may be bound or (ii) any order, rule or regulation applicable to the Company of any cour or any federal or state regulatory body or administrative agency or other governental body, the effect of which, in the case of (ii), would result in a Material Adverse Effect, and neither the execution and delivery of this Agreement, the Mortgage, or the Offered Securties, the consumation of the transactions herein or therein contemplated, the fulfillment of the terms hereof or thereof nor compliance with the terms and provisions hereof or thereof wil conflct with, or result in a breach of, or constitute a default under (x) the Articles or such Bylaws, or any material contract, agreement or other instrent to which it is now a part or by which it may be bound or (y) any order, rule or regulation applicable to the Company of any cour or any federal or state regulatory body or administrtive agency or other governental body having jursdiction over the Company or over its properties, the effect of which, singly or in the aggregate, would have a Material Adverse Effect. (k) Except as disclosed in the Disclosure Package and the Prospectus, there are no legal or governmental proceedings pending or to the Company's knowledge threatened against the Company or its subsidiaries which are not adequately disclosed in the Disclosure Package and the Prospectus that, if determned adversely to the Company or any subsidiary would be reasonably likely to have, individually or in the aggregate, a Material Adverse Effect or a material adverse effect on the abilty of the Company to perform its obligations under this Agreement or the Mortgage. (1) The consolidated financial statements included or incorporated by reference in the Disclosure Package and the Prospectus present fairly the financial condition and operations of the Company and its consolidated subsidiares at the respective dates or for the respective periods to which they apply; such financial. statements have been prepared in each case in accordance with generally accepted accounting principles consistently applied thoughout the periods involved except as otherwise indicated in the Disclosure Package and the Prospectus; and PricewaterhouseCoopers LLP, who examned certin audited financial statements of the Company, was, as of May 26, 2006 and during the period covered by the financial statements on which they reported, an independent registered public accounting firm as required by the 4 NY\ 138950.7 Securities Act and the Rules and Regulations thereunder; and Deloitte & Touche LLP, who has examined certin audited financial statements of the Company, is an independent registered public accounting firm as required by the Act and the Regulations thereunder. (m) Except as reflected in, or contemplated by, the Disclosure Package and the Prospectus, since the respective most recent dates as of which information is given in the Disclosure Package and the Prospectus, there has not been any change in the capital stock or long-term debt of the Company (other than changes arising from transactions in the ordinary coure of business), or any material adverse change in the business, affair, business prospects, propert or financial condition of the Company and its subsidiaries taken as a whole, whether or not arising in the ordinar course of business, and since such dates there has not been any material transaction entered into by the Company other than transactions contemplated by the Disclosure Package and the Prospectus, and transactions in the ordinary coure of business; and the Company has n~,material contingent obligation that is not disclosed in the Disclosure Package and the Prospectus. (n) The Company (i) makes and keeps books, records, and accounts, which, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company and its consolidated subsidiaries and (ii) maintains a system of internal accounting controls sufficient to provide reasonable assurances that (1) transactions are executed in accordance with management's general or specific authorization; (2) transactions are recorded as necessary to permt preparation of financial statements in conformty with generally accepted accounting principles or any other criteria applicable to such statements and to maintain accountability for assets; (3) access to assets is permitted only in accordance with management's general or specific authorization; and (4) the recorded accountabilty for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. (0) There is and has been no failure on the par of the Company or, to the knowledge of the Company, any of the Company's directors or executive offcers in their respective capacities as such, to comply in all material respects with the provisions of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith. 3. Purchase, Sale and Delivery of Offered Securities. On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set fort, the Company agrees to sell to the Underwriters, and the Underwters agree, severally and not jointly, to purchase from the Company (i) at a purchase price of 99.169% of the principal amount thereof plus accrued interest, if any, from July 17, 2008 to the Closing Date (as hereinafter defined), the respective principal amounts of the 2018 Bonds set forth opposite the names of the several Underwriters in Schedule A hereto, and (ii) at a purchase price of 98.568% of the principal amount thereof plus accrued interest, if any, from July 17, 2008 to the Closing Date (as hereinafter defined), the respective principal amounts of the 2038 Bonds set forth opposite the names of the several Underwters in Schedule A hereto; provided, that the Underwters severally agree to reimburse the Company for offering expenses of $575,000 and underwriting discount of $450,000 on the Closing Date, in each case in proportion to the respective principal amounts of the Offered Securities set forth opposite the names of the several Underwters in Schedule A hereto. The Company wil deliver against payment of the purchase price for each of the 2018 Bonds and the 2038 Bonds to be purchased by each Underwter hereunder and to be offered and sold by each Underwter in the form of global securties in registered form without interest coupons (the "Global Securities") deposited with the Trustee as custodian for The Depository Trust Company ("DTC") and 5 NY\ 1389508.7 registered in the name of Cede & Co., as nominee for DTC. Interests in the Global Securties wil be held only in book-entr form through DTC,except in the limited circumstances described in the Disclosure Package and the Prospectus. Payment for the 2018 Bonds and the 2038 Bonds shall be made by the Underwters in Federal (same day) funds by wire transfer to an account at a bank acceptable to the Underwiters drawn to the order of the Company, at the offce of Latham & Watkins LLP, 885 Third Avenue, New York, New York, 10022, at 10:00 A.M., (New York time), on July 17, 2008, or at such other time not later than seven full business days thereafter as the Underwiters and the Company determne, such time being herein referred to as the "Closing Date," against delivery to the Trustee as custodian for DTC of the Global Securties. The Global Securties wil be made available for checking at the above offce of Latham & Watkins LLP at least 24 hours prior to the Closing Date. 4. Representations by Underwriters; Resale by Underwriters. Each of the Underwiters severally represents and agrees that: (a) (i) It has only communicated or caused to be communicated (and will only communicate or cause to be communicated) an invitation or inducement to engage in investment activity (within the meaning of Section 21 of the Financial Services and Markets Act of 2000 (the "FSMA")) received by it in connection with the issue or sale of the Offered Securties in circumstances in which Section 21 (1) of the FSMA does not apply to the Company; and (ii) it has complied and wil comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the Offered Securties in, from or otherwise involving the United Kingdom. (b) In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a "Relevant Member State"), with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State (the "Relevant Implementation Date"), it has not made and wil not make an offer of the Offered Securities to the public in that Relevant Member State, except that it may, with effect from and including the Relevant Implementation Date, make an offer of the Offered Securties to the public in that Relevant Member State: (i) to legal entities which are authorized or regulated to operate in the financial markets or, if not so authorized or regulated, whose corporate purose is solely to invest in securities; (ii) to any legal entity which has two or more of (1) an average of at least 250 employees during the last financial year, (2) a total balance sheet of more than €43,000,000, and (3) an annual net turnover of more than €50,000,000, as shown in its last annual or consolidated accounts; (iii) to fewer than 100 natural or legal persons (other than qualified investors as defined in the Prospectus Directive), subject to obtaining the prior consent of the Representatives; or (iv) in any other circumstances falling within Aricle 3(2) of the Prospectus Directive; provided that no such offer of the Offered Securties shall require the Company or any Underwter to publish a prospectus pursuant to Aricle 3 of the Prospectus Directive. For the puroses of this provision, the expression an "offer of the Offered Securities to the public" in relation to the Offered Securties in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the Offered Securties to be offered so as to enable an investor to decide to purchase or subscribe the Offered Securties, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State and the expression Prospectus Directive means Directive 2003/71/EC and includes any relevant implementing measure in each Relevant Member State. 6 NY\1389508.7 (c) (i) In Hong Kong, it has not offered or sold the Offered Securities by means of any document other than (i) in circumstaces which do not constitute an offer to the public within the meaning of the Companies Ordinance (Cap. 32, Laws of Hong Kong), or (ii) to "professional investors" within the meaning of the Securties and Futures Ordinance (Cap. 571, Laws of Hong Kong) and any rules made thereunder, or (iii) in other circumstances which do not result in the document being a "prospectus" within the meaning of the Companies Ordinance (Cap. 32, Laws of Hong Kong), and no advertisement, invitation or document relating to the Offered Securities may be issued or may be in the possession of any person for the purpose of issue (in each case whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the laws of Hong Kong) other than with respect to Offered Securties which are or are intended to be disposed of only to persons outside Hong Kong or only to "professional investors" within the meaning of the Securties and Futues Ordinance (Cap. 571, Laws of Hong Kong) and any rules made thereunder. (ii) It wil not circulate or distrbute the Prospectus or any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the Offered Securities, nor wil it offer or sell, or be made the subject of an invitation for subscription or purchase, the Offered Securities, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor under Section 274 of the Securities and Futues Act, Chapter 289 of Singapore (the "SFA"), (ii) to a relevant person, or any person puruant to Section 275(1A), and in accordance with the conditions, specified in Section 275 of the SFA or (iii) otherise pursuant to, and in accordance with the conditions of, any other applicable provision of the SF A. (d) It wil not offer or sell any Offered Securities, directly or indirectly, in Japan or to, or for the benfit of, any resident of Japan (which term as used herein means any person resident in Japan, including any corporation or other entity organized under the laws of Japan), or to others for re-offering or resale, directly or indirectly, in Japan or to a resident of Japan, except pursuant to an exemption from the registration requirements of, and otherwise in compliance with, the Securties and Exchange Law and any other applicable laws, regulations and miisterial gudelines of Japan. (e) Without the prior consent of the Company and the Representatives, other than one or more term sheets relating to the Offered Securities containing customary information, it has not made and wil not make any offer relating to the Offered Securties that would constitute a free wrting prospectus; and any such free wrting prospectus the use of which has been consented to by the Company and the Underwters (including the final term sheet prepared and filed pursuant to Section 5(a) hereof) is listed on Schedule B hereto. 5. Certain Agreements of the Company. The Company agrees with the several Underwters that: (a) It wil prepare the Prospectus in a form approved by you and to fie such Prospectus pursuant to Rule 424(b) under the Securties Act not later than the Commission's close of business on the second business day following the date of this Agreement; to make no furter amendment or any supplement to the Registration Statement, or the Prospectus prior to the Closing Date that shall be reasonably disapproved by you promptly after reasonable notice thereof; to advise you, promptly after it receives notice thereof, of the time when any amendment to the Registration Statement has been fied or becomes effective or any amendment or supplement to the Prospectus has been fied and to furnish you with copies thereof; to prepare a final term sheet, containing solely a description of the Offered Securities, in a form approved by 7 NY\1389508.7 you and to fie such term sheet pursuant to Rule 433(d) under the Securities Act within the time required by such Rule; to fie promptly all other material required to be filed by the Company with the Commission pursuant to Rule 433(d) under the Securties Act; to fie promptly all reports and any definitive proxy or information statements required to be fied by the Company with the Commission pursuant to Section 13(a), 13(c), 14 or l5(d) of the Exchange Act subsequent to the date of the Prospectus and for so long as the delivery of a prospectus (or in lieu thereof, the notice referred to in Rule l73(a) under the Act) is required in connection with the offering or sale of the Offered Securties; to advise you, promptly after it receives notice thereof, of the issuance by the Commission of any stop order or of any order preventing or suspending the use of any Preliminary Prospectus or other prospectus in respect of the Offered Securties, of the suspension of the qualification of the Offered Securities for offering or sale in any jursdiction, of the initiation or threatening of any proceeding for any such purpose, or of any request by the Commssion for the amending or supplementing of the Registration Statement or the Prospectus or for additional information; and, in the event of the issuance of any stop order or of any order preventing or suspending the use of any Preliminary Prospectus or other prospectu or suspending any such qualification, to promptly use its best efforts to obtain the withdrwal of such order; and in the event of any such issuance of a notice of objection, promptly to take such steps including, without limitation, amending the Registration Statement or filing a new registration statement, at its own expense, as may be necessary to permit offers and sales of the Offered Securities by the Underwriters (references herein to the Registrtion Statement shall include any such amendment or new registrtion statement). (b) Prior to 10:00 a.m., New York City time, on the New York Business Day next succeeding the date of this Agreement and from time to time, to furnish the Underwiters with written and electronic copies of the Prospectus in New York City in such quantities as you may reasonably request, and, if the delivery of a prospectus (or in lieu thereof, the notice referred to in Rule l73(a) under the Securties Act) is required at any time prior to the expiration of nine months after the time of issue of the Prospectus in connection with the offering or sale of the Offered Securities and if at such time any event shall have occurred as a result of which the Prospectus as then amended or supplemented would include an untre statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made when such Prospectus (or in lieu thereof, the notice referred to in Rule l73(a) under the Securities Act) is delivered, not misleading, or, if for any other reason it shall be necessary durng such same period to amend or supplement the Prospectus or to fie under the Exchange Act any document incorporated by reference in the Prospectus in order to comply with the Securties Act, the Exchange Act or the Trut Indenture Act, to notify you and upon your request to fie such document and to prepare and furnish without charge to each Underwter and to any dealer in securities as many wrtten and electronic copies as you may from time to time reasonably request of an amended Prospectus or a supplement to the Prospectus that wil correct such statement or omission or effect such compliance; and in case any Underwiter is required to deliver a prospectus (or in lieu thereof, the notice referred to in Rule l73( a) under the Securties Act) in connection with sales of any of the Offered Securties at any time nine months or more after the time of issue of the Prospectus, upon your request but at the expense of such Underwter, to prepare and deliver to such Underwriter as many wrtten and electronic copies as you may request of an amended or supplemented Prospectus complying with Section 10(a)(3) of the Securties Act. (c) To make generally available to its securtyholders as soon as practicable, but in any event not later than 16 months after the effective date of the Registration Statement (as defined in Rule 158(c) under the Act), an earnings statement of the Company and its subsidiaries 8 NY\1389508,7 (which need not be audited) complying with Section 1 1 (a) of the Securties Act and the Rules and Regulations thereunder (including, at the option of the Company, Rule 158); (d) The Company wil arrange for the qualification of the Offered Securities for sale and the determination of their eligibilty for investment under the laws of such jursdictions in the United States and Canada as the Underwters designate and wil continue such qualifications in effect so long as required for the resale of the Offered Securities by the Underwters, provided that the Company wil not be required to qualify as a foreign corporation, to fie a general consent to service of process in any such jurisdiction or to take any other action that would subject the Company to service of process in any suits (other than those arising out of the offering of the Offered Securities ) or to taxation in respect of doing business in any jurisdiction in which it is not otherwise subject. (e) The Company wil pay all expenses incident to the pedormance of its obligations under this Agreement and the Mortgage, for any fiing fees and other expenses (including fees and disbursements of counsel) incured in connection with qualification of the Offered Securities for sale and determination of their eligibility for investment under the laws of such jurisdictions . as the Underwters designate and the printing of memoranda relating thereto, for the fees and expenses of the Trustee and its professional advisors, for all expenses in connection with the execution, issue, authentication, packaging and initial delivery of the Offered Securties, the preparation and printing of this Agreement, the Offered Securties, the Disclosure Package and the Prospectus, any Issuer Free Writing Prospectus, and amendments and supplements thereto, and any other document relating to the issuance, offer, sale and delivery of the Offered Securities, for the cost of any advertising approved by the Company in connection with the issue of the Offered Securties, for any fees charged by investment rating agencies for the rating of the Offered Securities, for any travel expenses of the Company's offcers and employees, and any other expenses of the Company in connection with attending or hosting meetings with prospective purchasers of the Offered Securities and for expenses incured in distributing the Disclosure Package, the Prospectus or any Issuer Free Writing Prospectus (including any amendments and supplements thereto) to the Underwiters. Except as otherwise provided in this Section 5( e) or in Section 9 of this Agreement, the Underwiters wil pay all of their costs and expenses, including fees and expenses of their counsel, transfer taxes on the resale of the Offered Securities and any advertising and travel expenses incured by them. (f) In connection with the offering, until the earlier of (i) 180 days following the Closing Date and (ii) the date the Underriters shall have notified the Company of the completion of the resale of the Offered Securities, neither the Company nor any of its affliates has or wil, either alone or with one or more other persons, bid for or purchase for any account in which it or any of its affliates has a beneficial interest any Offered Securties or attempt to induce any person to purchase any Offered Securities; and neither it nor any of its affliates wil make bids or purchases for the purose of creating actual, or apparent, active trding in, or of raising the price of, the Offered Securities. (g) From the date hereof through and including the Closing Date, the Company wil not, without the prior wrtten consent of the Underwiters, offer, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, or fie with the Commission a registration statement under the Securities Act relating to, any United States dollar-denominated debt securities issued or guaranteed by the Company and having a matuty of more than one year from the date of issue. 9 NY\ 1389508.7 (h) If the Company elects to rely upon Rule 462(b), the Company shall file a Rule 462(b) Registration Statement with the Commission in compliance with Rule 462(b) by 10:00 P.M., Washington, D.C. time, on the date of this Agreement, and the Company shall at the time of filing either pay to the Commission the fiing fee for the Rule 462(b) Registrtion Statement or give irrevocable instrctions for the payment of such fee puruant to Rule 111 (b) under the Act. (i) The Company (i) represents and agrees that, other than the final term sheet prepared and fied pursuant to Section 5(a) hereof, without the pnor consent of the Underwnters, it has not made and wil not make any offer relating to the Offered Securties that would constitute a "free wnting prospectus" as defined in Rule 405 under the Act and (ii) has complied and wil comply with the requirements of Rule 433 under the Act applicable to any Issuer Free Writing Prospectus, including timely filing with the Commission or retention where required and 1egending. 6. Conditions of the Obligations of the Underwriters. The obligations of the several Underwters to purchase and pay for the Offered Securties wil be subject to the accurcy of the representations and warranties on the par of the Company herein, to the accuracy of the statements of officers of the Company made pursuant to the provisions hereof, to the pedormance by the Company of its obligations hereunder and to the following additional conditions precedent: (a) The Prospectus as amended or supplemented in relation to the applicable Offered Secunties shall have been fied with the Commssion pursuant to Rule 424(b) within the applicable time penod prescribed for such filing (without reliance on Rule 424(b)(8) by the Rules and Regulations and in accordance with Section 5(a) hereof; if the Company has elected to rely upon Rule 462(b), the Rule 462(b) Registration Statement shall have become effective by 10:00 P.M., Washington, D.C. time, on the date hereof; no stop order suspending the effectiveness of the Registration Statement or any par thereof shall have been issued and no proceeding for that purose shall have been initiated or to the knowledge of the Company threatened by the Commission; and all requests for additional information on the par of the Commssion shall have been complied with. (b) (i) On the date hereof, PncewaterhouseCoopers LLP shall have fuished to the Underwters a letter, dated as of the date hereof, in form and substance satisfactory to the Underwiters, confirmng that as of May 26, 2006 and durng the penod covered by the financial statements on which it reported, it was an independent registered public accounting firm with respect to the Company and its subsidiares within the meaning of the Securties Act, the Exchange Act and the applicable published Rules and Regulations and stating that as of the Applicable Time (or, with respect to matters involving changes or developments since the respective dates as of which specified financial information is given in the Preliminary Prospectus as of a particular time not more than five business days pnor to the Applicable Time) conclusions and findings of such firm, to the effect that: (A) in their opinion the financial statements examined by them and incorporated by reference in the Preliminary Prospectus comply as to form in all material respects with the applicable accounting requirements of the Securities Act, the Exchange Act and the related published Rules and Regulations; and (B) they have compared specified dollar amounts (or percentages denved from such dollar amounts) and other financial information contained in the Preliminary Prospectus (in each case to the extent that such dollar amounts, 10 NY\ 1389508.7 percentages and other financial information are derived from the general accounting records of the Company and its subsidiaries subject to the internal controls of the Company's accounting system or are derived directly from such records by analysis or computation) with the results obtained from inquiries, a reading of such general accounting records and other procedures specified in such letter and have found such dollar amounts, percentages and other financial information to be in agreement with such results, except as otherwise specified in such letter. (ii) The Underwiters shall have received a letter, dated the Closing Date, of PricewaterhouseCoopers LLP which meets the requirements of subsection (b )(i) of this Section, except that (A) the specified date referred to in such subsection wil be a date not more than thee days prior to the Closing Date for the purposes of this subsection, and (B) references to the Preliminar ProspecIU wil be replaced with references to the Prospectus. (c) (i) On the date hereof, Deloitte & Touche LLP shall have fuished to the Underwriters a letter, dated as of the date hereof, in form and substance satisfactory to the Underwters, confirming that they are an independent registered public accounting firm with respect to the Company and its subsidiaries within the meaning of the Securties Act, the Exchange Act and the applicable published Rules and Regulations and stating that as of the Applicable Time (or, with respect to matters involving changes or developments since the respective dates as of which specified financial information is given in the Preliminary Prospectus as of a particular time not more than five business days prior to the Applicable Time) conclusions and findings of such firm, to the effect that: (A) in their opinion the financial statements examined by them and incorporated by reference in the Preliminar Prospectus comply as to form in all material respects with the applicable accounting requirements ofthe Securties Act, the Exchange Act and the related published Rules and Regulations; (B) on the basis of a reading of the latest available interim financial statements of the Company, inquiries of offcials of the Company who have responsibility for financial and accounting matters and other specified procedures, nothing came to their attention that caused them to believe that: (l) at the date of the latest available balance sheet read by such accountants, or at a subsequent specified date not more than one business day prior to the date of this Agreement, there was any change in the capital stock or any increase in short-term indebtedness or long-term debt of the Company and its consolidated subsidiaries or, at the date of the latest available balance sheet read by such accountants, there was any decrease in total shareholders' equity or total consolidated net curent assets, as compared with amounts shown on the latest balance sheet incorporated by reference in the Preliminary Prospectus; (2) for the period from the closing date of the latest statement of income incorporated by reference in the Preliminary Prospectus to the closing date of the latest statement of income read by such accountants, there were any decreases, as compared with the corresponding period of the previous year, in consolidated revenue or net income; 11 NY\ 1389508.7 (3) at July 11, 2008, there was any change in the capital stock, any increases in short-term indebtedness or long-term debt, or any decreases in net curent assets or total shareholder's equity, of the Company and its consolidated subsidiaries, in each case as compared with amounts shown on the latest balance sheet incorporated by reference in the Preliminar Prospectus; or (4) for the period from July 1,2008 to July 11,2008, there were any decreases, as compared with the corresponding period in the preceding year, in consolidated revenue or net income; and (C) they have compared specified dollar amounts (or percentages derived from such dollar amounts) and other financial information contained in the Preliminary Prospectus (in each case to the extent that such dollar amounts, percentages and other financial information are derived from the general accounting records of the Company and its subsidiaries subject to the internal controls of the Company's accounting system or are derived directly from such records by analysis or computation) with the results obtained from inquiries, a reading of such general accounting records and other procedures specified in such letter and have found such dollar amounts, percentages and other financial information to be in agreement with such results, except as otherwise specified in such letter. (ii) The Underwiters shall have received a letter, dated the Closing Date, of Deloitte & Touche LLP which meets the requirements of subsection (c )(i) of this Section, except that (A) the specified date referred to in such subsection wil be a date not more than one day prior to the Closing Date for the puroses of this subsection, and (B) references to the Preliminary Prospectus wil be replaced with references to the Prospectus. (d) Subsequent to the Applicable Time, there shall not have been (i) any change, or any development or event involving a prospective change, in the financial condition, business, properties or results of operations of the Company and its subsidiaries taken as a whole, which, in the judgment of the Underwters, is material and adverse and makes it impractical or inadvisable to proceed with completion of the offering or the sale of and payment for the Offered Securities; (ii) any downgrading in the rating of any debt securities or preferred stock of the Company by any "nationally recognized statistical rating organization" (as defined for puroses of Rule 436(g) under the Securties Act), or any public announcement that any such organization has under sureilance or review its rating. of any debt securities or preferred stock of the Company (other than an announcement with positive implications of a possible upgrading, and no implication of a possible downgrading, of such rating); (ii) any material suspension or material limitation of trading in securties generally on the New York Stock Exchange, or any setting of minimum prices for trading on such exchange; (iv) any suspension of trding of any securities of the Company on any exchange or in the over-the-counter market; (v) any banking moratorium declared by U.S. Federal or New York authorities; (vi) any major disruption of settlements of securties or clearce servces in the United States; or (vii) any attack on, or outbreak or escalation of hostilities or act of terrorism involving, the United States, any declaration of war by Congress or any other substantial national or international calamity or emergency if, in the judgment of the Underwiters, the effect of any such attack, outbreak, escalation, act, declaration, calamity or emergency makes it impractical or inadvisable to proceed with completion of the offering or sale of and payment for the Offered Securties. 12 NY\ 138958.7 (e) The Underwters shall have received an opinion, dated the Closing Date, of Mark C. Moench, General Counsel of the Company, substantially in the form of Exhibit A hereto. (f) The Underwiters shall have received an opinion, dated the Closing Date, of Perkins Coie LLP, special counsel to the Company, in substantially the form of Exhibit B hereto. (g) The Underwiters shall have received from Latham & Watkins LLP, counsel for the Underwriters, such opinion or opinions, dated the Closing Date, in form and substance satisfactory to the Underwiters, and the Company shall have fuished to such counsel such documents as they request for the purpose of enabling them to pass upon such matters. In rendering such opinion, Latham & Watkins LLP may rely as to the incorporation of the Company and all other matters governed by Oregon law upon the opinion of Mark C. Moench referred to above. (h) The Underwters shall have received a certificate, dated the Closing Date, of the President or any Vice President and a principal financial or accounting offcer of the Company in which such officers, to the best of their knowledge after reasonable investigation, shall state that: (i) the representations and warranties of the Company in this Agreement are tre and correct, or tre and correct in all material respects where such representations and warrties are not qualified by materiality or Material Adverse Effect; (ii) that the Company has complied with all agreements and satisfied all conditions on its par to be pedormed or satisfied hereunder at or prior to the Closing Date; and (iii) that, subsequent to the date of the most recent financial statements in, or incorporated by reference in, the Preliminary Prospectus, there has been no material adverse change, nor any development or event involving a prospective material adverse change, in the financial condition, business or results of operations of the Company and its subsidiares taken as a whole except as set forth in the Disclosure Package and the Prospectus or as described in such certificate. The Company wil (i) fuish the Underwters with such conformed copies of such opinions, certificates, letters and documents as the Underwters reasonably request. The Underwriters may waive compliance with any conditions to their obligations hereunder. 7. Indemnifcation and Contribution. (a) The Company wil indemnify and hold harmless each Underwriter, its parers, members, directors and officers and each person, if any, who controls such Underwter within the meaning of Section 15 of the Securities Act, against any losses, claims, damages or liabilities, joint or several, to which such Underwriter may become subject, under the Securties Act or the Exchange Act or otherwise, insofar as such losses, claims, damages or liabilties (or actions in respect thereof) arse out of or are based upon any untrue statement or alleged untre statement of any material fact contained in the Registration Statement, the Preliminar Prospectus, the Disclosure Package, the Prospectus or any Issuer Free Writing Prospectus, or any amendment or supplement to the Registrtion Statement, the Prospectus or any Issuer Free Writing Prospectus, or any "issuer information" fied or required to be fied pursuant to Rule 433(d) under the Act, arise out of or are based upon the omission or alleged omission to state therein a material fact necessary in order to make the statements therein made, in light of the circumstances under which they were made (in the case of the Registration Statement, necessary in order to make the statements therein not misleading), not misleading, including any losses, claims, damages or liabilties arising out of or based upon the Company's failure to pedorm its obligations under Section 5(a) of this Agreement, and wil reimburse each Underwter for any legal or other expenses reasonably incurred by such Underwter in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are incured; provided, however, that the Company wil not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement in or omission or alleged 13 NY\13895.7 omission from any of such documents in reliance upon and in conformty with wrtten information fuished to the Company by the Representatives on behalf of the Underwters specifically for use therein, it being understood and agreed that the only such information consists of the information described as such in subsection (b) below; provided, further, that the foregoing indemnity with respect to any Preliminar Prospectus shall not inure to the. benefit of any Underwter from whom the person asserting any such losses, claims, damages or liabilties (or actions in respect thereof), in connection with clauses (i) through (iii) below, purchased Offered Securties, or any person controllng such Underwter, where it shall have been determined by a cour of competent jursdiction by final and non-appealable judgment that (i) prior to the Applicable Time the Company has notified such Underwter that the Preliminar Prospectus, dated July 14, 2008, contains an untre statement of material fact or omits to state therein a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, (ii) such untre statement or omission of a material fact was corrected in an amended or supplemented Preliminar Prospectus and such corrected Preliminary Prospectus was provided to such Underwriter suffciently in advance of the Applicable Time so that such corrected Preliminary Prospectus could have been conveyed to such person prior to the Applicable Time and (iii) such corrected Preliminary Prospectus was not conveyed to such person at or prior to the Applicable Time to such person. (b) Each Underwter wil severally and not jointly indemnify and hold harmless the Company, its directors and offcers and each person, if any, who controls the Company within the meaning of Section 15 of the Securities Act, against any losses, claims, damages or liabilities to which the Company may become subject, under the Securties Act or the Exchange Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untre statement or alleged untrue statement of any material fact contained in the Registration Statement, the Preliminary Prospectus, the Disclosure Package, the Prospectus or any Issuer Free Writing Prospectus, or any amendment or supplement to the Registration Statement, the Prospectus or any Issuer Free Writing Prospectus or arise out of or are based upon the omission or the alleged omission to state therein a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made (in the case of the Registration Statement, necessary in order to make the statements therein not misleading), not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with written information fuished to the Company by the Representatives on behalf of the Underwters specifically for use therein, and wil reimburse any legal or other expenses reasonably incured by the Company in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are incurred, it being understood and agreed that the only such information fuished by any Underwter consists of the following information in the Preliminar Prospectus and Prospectus fuished on behalf of each Underwter: under the caption "Underwriting," paragraphs 3, 4 (second sentence only) 5 and 6; provided, however, that the Underwriters shall not be liable for any losses, claims, damages or liabilties arising out of or based upon the Company's failure to pedorm its obligations under Section 5(a) of this Agreement. (c) Promptly after receipt by an indemnified part under this Section of notice of the commencement of any action, such indemnified part will, if a claim in respect thereof is to be made against the indemnifying par under subsection (a) or (b) above, notify the indemnifying part of the commencement thereof; but the omission so to notify the indemnifying part wil not relieve it from any liability which it may have to any indemnified par under subsection (a) or (b) above except to the extent that it has been materially prejudiced (though forfeitue or impairment of procedural or substantive rights or defenses) by such failure; and provided further that the failure to notify the indemnifying par shall not relieve it from any liability that it may have to an indemnified par otherwise than under subsection (a) or (b) above. In case any such action is brought against any indemnified part and it notifies the indemnifying par of the commencement thereof, the indemnifying part wil be entitled to partcipate 14 NY\ 1389508.7 therein and, to the extent that it may wish, jointly with any other indemnifying part similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified par (who shall not, except with the consent of the indemnified part, be counsel to the indemnifying part), and after notice from the indemnifying part to such indemnified par of its election. so to assume the defense thereof, the indemnifying part wil not be liable to such indemnified par under this Section for any legal or other expenses subsequently incured by such indemnified par in connection with the defense thereof other than reasonable costs of investigation; provided, however, that the indemnified part shall have the right to employ counsel to represent the indemnified par and their respective controllng persons who may be subject to liability arising out of any claim in respect of which indemnity may be sought by the indemnified par against the indemnifying part under this Section 7 if the employment of such counsel shall have been authorized in writing by the indemnifying part in connection with the defense of such action, if in the written opinion of counsel to either the indemnifying part or the indemnified part, representation of both paries by the same counsel would be inappropriate due to actual or likely conflcts of interest between them or the indemnifying par shall have failed to employ counsel within a reasonable period of time, and in that event the fees and expenses of one firm of separate counsel (in addition to the fees and expenses of one local counsel in each applicable jursdiction) shall be paid by the indemnifying part. No indemnifying part shall, without the prior wrtten consent of the indemnified part (which consent shall not be uneasonably withheld), effect any settlement of any pending or threatened action in respect of which any indemnified part is or could have been a par and indemnity could have been sought hereunder by such indemnified par unless such settlement (i) includes an unconditional release of such indemnified par from all liability on any claims that are the subject matter of such action and (ii) does not include a statement as to or an adssion of fault, culpability or failure to act by or on behalf of any indemnified par. (d) If the indemnification provided for in this Section is unavailable or insuffcient to hold harmless an indemnified part under subsection (a) or (b) above, then each indemnifying par shall contribute to the amount paid or payable by such indemnified par as a result of the losses, claims, damages or liabilities referred to in subsection (a) or (b) above (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwiters on the other from the offering of the 2018 Bonds or the 2038 Bonds, as applicable, or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company on the one hand and the Underwiters on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwters on the other shall be deemed to be in the same proportion as the total net proceeds (before deducting expenses) from the offering of the 2018 Bonds or the 2038 Bonds, as applicable, received by the Company bear to the total discounts and commissions received by the Underwriters with respect to the 2018 Bonds or the 2038 Bonds, as applicable, from the Company under this Agreement. The relative fault shall be determined by reference to, among other things, whether the untre or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or the Underwters and the parties' relative intent, knowledge, access to information and opportnity to correct or prevent such untre statement or omission. The amount paid by an indemnified part as a result of the losses, claims, damages or liabilties referred to in the first sentence of this subsection (d) shall be deemed to include any legal or other expenses reasonably incurrd by such indemnified par in connection with investigating or defending any action or claim which is the subject of this subsection (d). Notwithstanding the provisions of this subsection (d), no Underwter shall be required to contribute any amount in excess of the amount by which the total price at which the 2018 Bonds or the 2038 Bonds, as applicable, purchased by it were resold exceeds the amount of any daages which such Underwter has otherwise been required to pay by reason of such untre or alleged untre statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11 (f) 15 NY\ 1389508.7 of the Act) shall be entitled to contrbution from any person who was not guilty of such fraudulent misrepresentation. The Underwters' obligations in this subsection (d) to contribute are several in proportion to their respective purchase obligations and not joint. (e) The obligations of the Company under this Section shall be in addition to any liabilty which the Company may otherwise have and shall extend, upon the same terms and conditions, to each person, if any, who controls any Underwiter within the meaning of the Securties Act or the Exchange Act; and the obligations of the Underwters under this Section shall be in addition to any liability which the respective Underwters may otherwise have and shall extend, upon the same terms and conditions, to each person, if any, who controls the Company within the meaning of the Securties Act or the Exchange Act. 8. Default of Underwriters. If any Underwter or Underwters defaults in its or their obligations to purchase the 2018 Bonds or the 2038 Bonds, as applicable, hereunder and the aggregate principal amount of the 2018 Bonds or the 2038 Bonds that such defaulting Underwter or Underwters agreed but failed to purchase does not exceed 10% of the total principal amount of 2018 Bonds or the 2038 Bonds, as applicable, the non-defaulting Underwriters may make arrangements satisfactory to the Company for the purchase of such 2018 Bonds or 2038 Bonds by other persons, including themselves, but if no such arrangements are made by the Closing Date, the non-defaulting Underwters shall be obligated severally, in proportion to their respective commitments hereunder, to purchase the Offered Securities that such defaulting Underwiter or Underwters agreed but failed to purchase. If any Underwter or Underwiters so defaults and the aggregate principal amount of the 2018 Bonds or the 2038 Bonds, as applicable, with respect to which such default or defaults occur exceeds 10% of the total principal amount of the 2018 Bonds or the 2038 Bonds, as applicable, and arrangements satisfactory to the non-defaulting Underwters and the Company for the purchase of such 2018 Bonds or 2038 Bonds by other persons are not made within 36 hours after such default, this Agreement wil terminate without liability on the par of the non-defaulting Underwters or the Company, except as provided in Section 9. As used in this Agreement, the term "Underwriter" includes any person substituted for a Underwter under this Section. Nothing herein, including the Company's obligations pursuant to Section 9 hereof, wil relieve a defaulting Underwter from liability for its default. 9. Survival of Certain Representations and Obligations. The respective indemnities, agreements, representations, warranties and other statements of the Company or its offcers and of the several Underwters set forth in or made pursuant to this Agreement wil remain in full force and effect, regardless of any investigation, or statement as to the results thereof, made by or on behalf of any Underwriter, the Company or any of their respective representatives, offcers or directors or any controlling person, and wil surive delivery of and payment for the Offered Securties. If this Agreement is terminated pursuant to Section 8 or if for any reason the purchase of the Offered Securities by the Underwriters is not consummated other than such default by an Underwter, the Company shall remain responsible for the expenses to be paid or reimbursed by it pursuant to Section 5 and the respective obligations of the Company and the Underwriters pursuant to Section 7 shall remain in effect. If the purchase of the Offered Securities by the Underwriters is not consummated for any reason other than solely because of the termination of this Agreement pursuant to Section 8 or the occurence of any event specified in clause (iii), (v), (vi) or (vii) of Section 6( c), the Company wil reimburse the Underwriters for all out-of-pocket expenses (including fees and disbursements of counsel) reasonably incured by them in connection with the offering of the Offered Securities, provided that the Company shall not be obligated under this Section 9 to reimburse the Underwiters for any expenses (including any reasonable fees and disbursements of counsel) in excess of $200,000. 10. No Fiduciary Duty. The Company acknowledges and agrees that in connection with this offering or any other services the Underwters may be deemed to be providing hereunder, 16 NY\ 138950.7 notwithstanding any preexisting relationship, advisory or otherwise, between the parties or any oral representations or assurances previously or subsequently made by the Underwters: (i) no fiduciar or agency relationship between the Company and any other person, on the one hand, and the Underwnters, on the other, exists in connection with the offenng of the Bonds; (ii) the Underwters are not acting as advisors, expert or otherwise, to the Company in connection with the offenng of the Bonds and such relationship between the Company, on the one hand, and the Underwters, on the other, is entirely and solely commercial, based on ars-length negotiations; (ii) any duties and obligations that the Underwters may have to the Company in connection with the offenng of the Bonds shall be limited to those duties and obligations specifically stated herein; and (iv) the Underwters and their respective affiliates may have interests that differ from those of the Company. Any review by the Underwters of the Company, the transactions contemplated hereby or other matters related to such trnsactions wil be pedormed solely for the benefit of the Underwnters and not on behalf of the Company. The Company hereby w~ives any claims that the Company may have against the Underwnters with respect to any breach of fiduciary duty in connection with this offenng. 11. Notices. All communications hereunder wil be in wnting and, if sent to the Underwters, wil be mailed, delivered or faxed and confirmed to each of (i) Lehman Brothers Inc., 745 Seventh Avenue, New York, New York 10019, Facsimile number 646-834-8133, Attention: Debt Capital Markets, Power Group (with a copy to the General Counsel at the same address), (ii) Greenwich Capital Markets, Inc., 600 Steamboat Road, Greenwich, Connecticut 06830, Facsimile number 203-422-4534, Attention: Debt Capital Markets Syndicate, (iii) J.P. Morgan Securities Inc., 270 Park Avenue, New York, New York 10017, Facsimile number 212-834-6081, Attention: High Grade Syndicate Desk - 8th Floor, and (iv) Wachovia Capital Markets, LLC, 301 South College Street, Charlotte, North Carolina 28288, Facsimile number 704-383-9165, Attention: Transaction Management Group, or, if sent to the Company, wil be mailed, delivered or telegraphed and confirmed to it at PacifiCorp, 825 NE Multnomah, 18th Floor, Portland, OR 97232, Attention: Legal Deparent; provided, however, that any notice to a Underwriter pursuant to Section 7 wil be mailed, delivered or faxed and confirmed to such Underwriter. 12. Successors. This Agreement wil inure to the benefit of and be binding upon the parties hereto and their respective successors and the controllng persons referred to in Section 7, and no other person wil have any right or obligation hereunder. 13. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an onginal, but all such counterpars shall together constitute one and the same Agreement. 14. Applicable Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of N ew York without regard to principles of conflcts of laws. The Company hereby submits to the exclusive junsdiction of the Federal and state cours in the Borough of Manhattan in The City of New York in any suit or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby. (Signatures follow L 17 NY\1389508.7 If the foregoing is in accordance with the Underwters' understading of our agrement, kindly sign and return to us one of the counterpar hereof, whereupon it wil become a binding agreement between the Company and the several Underwiters in accordance with its terms. Very trly yours, Pacjfi~~ By: ~ Ñ LJft Name: Title: Underwriting Agrement The fOregoing Underwìtitig Agrment is herebyconfinn .and acceted asøfthe date first above wrtten. :lMRR~. ~ l~ N~me:OJ..J.1ITitle: ~.~ GREENCilCAPITAL MA1" INC, By: Nam: Title: J.P. MORGAN SECURlflES INC. By: Name: Title: WACHOVIA CAPITAL MARKErS, LLC By:Nat: Title: On ~haf of themlves an as Represetaties of the severI Undtes UnderwritÌ1ig Agreemeni The foregoin Underwiting Agrement is hereby confied and accepted as of th date first above wr. LEHMAN BROTHRS INC. By: Name: Title: GREENWICH CAPITAL MATS, INC.BY:~~-'.. Name:" iU::.. '4 ~ l ic I t1 t.'l eou "" Title: Soe:iol' v'1c. I~e-s l Delt1" J.P. MORGAN SECURITIES INC. By: Name: Title: WACHOVIA CAPITAL MATS, LLC By: Name: Title: On behalf of themselves and as Representatives of the several Underwters Undrwriting Agreement The foregoing Underwriting Agreement is hereby confirmed an accepted as of the date first above written. LEHMAN BROTHERS INC. By: Name: Title: GREENWICH CAPITAL MARKETS, INC. By: Name: Title:J.P.~~_ By:Name: ROBE BOEDTitle: - ~~ WACHOVIA CAPITAL MAKETS, LLC By: Name: Title: On behalf of themslves and as Represntatives of the several Underwriters UlfTW AgreJtnt ~ The foregoing Underwriting Agreement is hereby confinned and accepted as of the date first above written. LEHMN BROTIRS INC. By: "Name: Title: GREENWICH CAPITAL MATS, INC. By: Name: Title: J.P. MORGAN SECURTIES INC. By: Name: Title: n behalf of themselves and as Representatives of the several Underwters Undenvriting Agreement SCHEDULE A Underwriter LEHMAN BROTHERS INC. ..................................................................... GREENWICH CAPITAL MARKTS, INC. ............................................. J.P. MORGAN SECURTIES INC. ... ........................................................ W ACHOVIA CAPITAL MARKTS, LLC ... ............................................ SCOTIA CAPITAL (USA) INC. ................................................................ BARCLAYS CAPITAL INC. .., ................................................................. BNP PARIBAS SECURITIES CORP. ....................................................... GOLDMAN, SACHS & CO. ... .................................................................. BANC OF AMERICA SECURITIES LLC ................................................ CITIGROUP GLOBAL MARKTS INC. ... .............................................. CREDIT SUISSE SECURITIES (USA) LLC ... ......................................... PIPER JAFFRA Y & CO. ............................................................................ SUNRUST ROBINSON HUPHREY, INC. ... ...................................... WEDBUSH MORGAN SECURITIES INC. ... .......................................... WELLS FARGO SECURITIES, LLC ... .................................................... Total...................................................................... NY\ 1389508.7 Principal Amount of 2018 Bonds $72,500,000 $72,500,000 $72,500,000 $72,500,000 $40,000,000 $27,500,000 $27,500,000 $27,500,000 $12,500,000 $12,500,000 $12,500,000 $12,500,000 $12,500,000 $12,500,000 $12,500,000 $500.000.000 Principal Amount of 2038 Bonds $43,500,000 $43,500,000 $43,500,000 $43,500,000 $24,000,000 $16,500,000 $16,500,000 $16,500,000 $7,500,000 $7,500,000 $7,500,000 $7,500,000 $7,500,000 $7,500,000 $7,500,000 $300.000.000 SCHEDULE D(i) Issuer Free Writing Prospectuses See Schedule B(ii) NY\ 1389508.7 Issuer: Ratings*: Security Type: Legal Format: Principal Amount: Coupon: Interest Payment Dates: Trade Date: Settlement Date: Maturity: Treasur Benchmark: US Treasury Spot: US Treasur Yield: Spread to Treasury: Re-offer Yield: NY\ 138958.7 SCHEDULE B(ii) FINAL TERM SHEET PacifiCorp 2018 Bonds: A3 / A- / A- 2038 Bonds: A3 / A- / A- First Mortgage Bonds due 2018 First Mortgage Bonds due 2038 SEC Registered 2018 Bonds: $500,000,000 2038 Bonds: $300,000,000 2018 Bonds: 5.650% 2038 Bonds: 6.350% Filed pursuant to Rule 433( d) Registration No. 333-148662) Dated July 14, 2008 Semi-annually on January 15 and July 15, commencing on January 15,2009 July 14, 2008 July 17,2008 (T + 3) 2018 Bonds: July 15,2018 2038 Bonds: July 15,2038 2018 Bonds: 3.875%, May 15,2018 2038 Bonds: 5.000%, May 15,2037 2018 Bonds: 100 2038 Bonds: 108-16 2018 Bonds: 3.874% 2038 Bonds: 4.472% 2018 Bonds: + 180 basis points 2038 Bonds: + 192 basis points 2018 Bonds: 5.674% 2038 Bonds: 6.392% Price to Public (Issue Price): 2018 Bonds: 99.819% of principal amount 2038 Bonds: 99.443% of principal amount Optional Redemption: 2018 Bonds: Make-Whole Call at T+30 basis points 2038 Bonds: Make-Whole Call at T+30 basis points Denominations: $2,000 and any integral multiples of$l,OOO in excess thereof Joint Bookrers: Lehman Brothers Inc. Greenwich Capital Markets, Inc. J.P. Morgan Securties Inc. Wachovia Capital Markets, LLC Co-Managers: Scotia Capital (USA) Inc. Barclays Capital Inc. BNP Parbas Securities Corp. Goldman, Sachs & Co. Banc of America Securties LLC Citigroup Global Markets Inc. Credit Suisse Securties (USA) LLC Piper Jaff-ay & Co. SunTrust Robinson Humphrey, Inc. Wedbush Morgan Securties Inc. Wells Fargo Securities, LLC CUSIP: 2018 Bonds: 695114 CH9 2038 Bonds: 695114 CJ5 * Note: A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time. The issuer has filed a registration statement (including a prospectus) with the U.S. Securties and Exchange Commission (SEC) for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about the issuer and this offering. You may get these documents for free by visiting EDGAR on the SEC Web site at ww.sec.gov. Alternatively, the issuer, any underwriter or any dealer participating in the offering wil arrange to send you the prospectus if you request it by calling Lehman Brothers Inc. at 1-888-603-5847, Greenwich Capital Markets, Inc. at 1-866- 884-2071, J.P. Morgan Securities Inc. at 212-834-4533 (call collect), or Wachovia Capital Markets, LLC at 1-800-326-5897. NY\1389508.7 EXHIBIT A Form of Opinion of Mark C. Moench, General Counsel of the Company 1. To my knowledge and except for the matters disclosed in the Disclosure Package, there is no legal or governental action, suit or proceeding before any cour, governental agency, body or authority, domestic or foreign, now pending or threatened against or involving the Company or any subsidiary of the Company that, if determined adversely to the Company and its subsidiaries, taen as a whole, is reasonably likely to have, individually or in the aggregate, a material adverse effect on the business, affairs, propert or financial condition of the Company and its subsidiares taken as a whole or a material adverse effect on the abilty of the Company to perform its obligations under the Underwting Agreement, the Mortgage or the Bonds. 2. The execution, delivery and performance of the Underwting Agreement and the Mortgage and the issuance and sale of the Bonds and the use of proceeds of the Bonds as designated in the Prospectus do not and wil not (A) conflct with the Aricles ofIncorporation or By-laws of the Company, (B) to my knowledge, conflct with, result in the creation or imposition of any lien, charge or other encumbrance, other than the Mortgage, upon any asset of the Company pursuant to the terms of, or constitute a breach of, or default under, any agreement, indentue or other instrument to which the Company is a par, or by which the Company is bound or to which any of its properties are subject or (C) to my knowledge, result in a violation of any statute, rule or regulation, or any order, judgment or decree known to me of any cour or governmental agency, body or authority having jurisdiction over the Company or any of its properties, where any such conflct, encumbrance, breach, default or violation under clause (B) or (C) is reasonably likely to have, individually. or in the aggregate, a material adverse effect on the business, affairs, propert or financial condition of the Company and its subsidiaries taken as a whole. 3. To my knowledge, except for such consents, approvals, authorizations, registrations or qualifications as may be required under the Securties Act, the Trust Indentue Act or state securties or blue sky laws or as may be required by applicable state public utilty commssions and under the Federal Power Act, no consent, authorization or order of, or fiing or registration by the Company with, any cour, governental agency or third part is required in connection with the execution, delivery and performance by the Company of the Underwriting Agreement and the Mortgage, the consummation of the trnsactions contemplated herein and therein, and the issuance, distrbution and sale of the Bonds as contemplated therein, in each case where the effect of the failure to obtain such approval, authorization, consent or order, or make such fiing, is material to the Company. 4. The Company has good and suffcient title to the Properties subject to the Mortgage, which include substantially all of the permanent physical properties and franchises of the Company (other than those expressly excepted), subject only to Excepted Encumbrances and defects and irregularities customarly found in properties of like size and character that, in my opinion, do not materially impair the use of the propert affected thereby in the operation of the business of the Company; the descriptions in the Mortgage of such of the Properties as are described therein are adequate to constitute the Mortgage as a lien thereon; the Mortgage constitutes a valid lien on the Properties and, to the best of my knowledge, there is no lien on the Properties prior or equal to the lien of the Mortgage, other than the exceptions enumerated above in this paragraph 4. NY\138950.7 EXHIBITB Form of Opinion of Perkins Coie LLP, special counsel to the Company 1. The Company has been duly incorporated and is validly existing under the laws of Oregon as a corporation, with the corporate power and authority to own its properties and conduct its business as described in the Preliminary Prospectus, as supplemented by the Free Writing Prospectus, attached as Schedule B(i) to the Underwting Agreement, and the Prospectus. 2. The Company is duly qualified to do business as a foreign corporation and is in good standig in each jursdiction where the ownership or leasing of its properties or the conduct of its business requires such qualification, except where the failure to be so qualified and in good stading would not, individually or in the aggregate, have a Material Adverse Effect. 3. The Company has all requisite corporate power and authority to enter into the Underwriting Agreement and the Supplemental Indenture, to issue the Bonds and to consumate the transactions contemplated by the Underwting Agreement. 4. Each of the Underwiting Agreement and the Mortgage has been duly and validly authorized, executed and delivered by the Company. 5. The Mortgage constitutes the valid and binding obligation of the Company, enforceable against the Company in accordance with its terms. 6. The Mortgage has been duly qualified under the Trust Indentue Act of 1939, as amended (the "Trust Indenture Act"). 7. The Bonds are in the form contemplated by the Mortgage, have been duly authorized by the Company for issuance and sale pursuant to the Underwting Agreement and the Mortgage, have been duly executed and, when authenticated by the Trustee in the maner provided in the Mortgage and delivered against payment of the purchase price therefore puruant to the Underwting Agreement, wil constitute valid and binding obligations of the Company, enforceable against the Company in accordace their terms, and entitled to the benefits of the Mortgage. 8. The statements in the Prospectus under the captions "Description of the Bonds" and "Description of Additional Bonds" insofar as they purport to summarize the provisions of the Mortgage and the Bonds, fairly summarize such provisions in all material respects. 9. No approval, authorization, consent or order of, or filing with any governmental or regulatory body or agency is required in connection with the issuance and sale of the Bonds by the Company, the consummation by the Company of the transactions contemplated by the Underwting Agreement, the due authorization, execution or delivery of the Underwiting Agreement or the due execution, delivery or pedormance of the Mortgage by the Company, in each case where the effect of the failure to obtain such approval, authorization, consent or order, or to make such filing, could reasonably be expected to have a Material Adverse Effect and except (a) the registration of the Bonds with the Commission under the Securties Act pursuant to the Registration Statement and (b) such as have been obtained or made. 10. The Idaho Public Utilities Commssion and the Public Utility Commission of Oregon have entered appropriate orders, which to our knowledge remain in full force and effect on the date of this letter, each authorizing the issuance of the Bonds by the Company; the Company has fied a notice with the Washington Utilties and Transportation Commission regarding the issuance and sale of the Bonds NY\ 1389508.7 that complies with the fiing requirements ofRCW 80.08.040 and WAC 480-100-242; the Company has fied a notice of proposed securties issuance with the Idaho Public Utilities Commssion regarding the issuance and sale of the Bonds pursuant to Order No. 30489; and, together with certin exemptive orders that have been issued by each of the Public Utilities Commission of the State of California, the Public Service Commission of Utah and the Public Service Commission of Wyoming (which to our knowledge remain in full force and effect on the date of this letter), such orders and notices constitute the only approval, authorization, consent or other order of, or notification to, any governmental body legally required in connection with the regulation of the Company as a public utilty for the authorization of the issuance of the Bonds by the Company pursuant to the terms of the Underwting Agreement. 11. The Registration Statement was declared immediately effective under the Securties Act on January 9, 2008; the Prospectus was filed with the Commission puruant to Rule 424(b) on July ( ),2008 in a manner and within the time period required by Rule 424(b) under the Securities Act; and, based solely on a telephone conversation with representatives of the Commission, as of the date hereof, no stop order suspending the effectiveness of the Registration Statements has been issued under the Securties Act and, to our knowledge, no proceedings for that purose have been initiated by the Commssion. 12. The Registration Statement, as of its effective date, and the Preliminary Prospectus, as of its date, including in each case the information deemed to be a part thereof pursuant to Rule 430B under the Securities Act, and the Prospectus, as of its date, complied as to form. in all material respects with the applicable requirements of the Securties Act and the rules thereunder; it being understood, however, that we express no view with respect to the financial statements, schedules, other financial data, or exhibits included or incorporated by reference in, or omitted from, the Registration Statements, the Preliminary Prospectus or the Prospectus or Regulation S- T. NY\ 1389508.7 REPORT OF SECURITIES ISSUED July 17,2008 PACIFICORP Description of securities:$500,000,000 ofPacifiCorp's First Mortgage Bonds 5.65% Series due July 15,2018 $300,000,000 ofPacifiCorp's First Mortgage Bonds 6.35% Series due July 15,2038 Description Amount 1.Face value or principal amount $800,000,000 2.Plus premium or less discount (2,576,000) 3.Gross proceeds 797,424,000 4.Underwriter's spread or commission*(4,850,000) 5.Securities and Exchange Commission registration fee (31,440) 6.State mortgage registration tax N/A 7.State commission fee**(2,000) 8.Fee for recording indenture * * (25,000) 9.United States document tax N/A 10.Printing and engraving expenses* *(30,000) 11.Trustee's charges**(20,000) 12,Counsel fees**(100,000) 13.Accountants' fees**(115,000) 14.Cost of listing N/A 15.Miscellaneous expenses of issue* * *(251,560) (Describe large items) 16.Total deductions (575,000) 17.Net amount realized $791,999,000 * ** *** Underwiting commission net of$I,025,000 reimbursement. Denotes estimate only. Includes estimated rating agency fees of $200,000 for the Bonds. All amounts rounded to nearest 1,000. S:\SHARD\FILINGS\ID\2007 ID Dockets & Filngs\ID PAC-E-07- 16 Credit filing 12- I 8-07\Report of Securities Issued 7-21 -08\Report of Securities Issued 07 I 608,DOC