20090115Report 1st Mortgage Bond Offering.pdf

~~\;co~OUNTAIN ECE..1ur:nR . \ 'i ,..". . ;;.
innq JMl \ 5 M~ 9~ 48
201 Sout Main, Suite 2300
Salt lake City, Utah 84111
Janua 15,2009
VI OVERNIGHT DELIVERY
Idaho Public Utilties Commission
472 West Washington Street
Boise, Idaho 83702
Att: Ms. Jean Jewell
Commission Secreta
Re: Case No. PAC-E-07-16
Order No. 30489
Report of First Mortgage Bond Offering in
Aggregate Pricipal Amount of $1,000,000,000
Dear Commssioners:
Pursuat to the referenced Order, PacifiCorp submits to the Commssion an original and nine (9)
copies of the following documents relating to PacifiCorp's Janua 5, 2009 offering of
$350,000,000 aggregate pricipal amount of Firt Mortgage Bonds, 5.50% Series due 2019 and
$650,000,000 aggregate principal amount of First Mortgage Bonds, 6.00% Series due 2039 (the
"Bonds"):
1. Prospectus Supplement dated Janua 5, 2009
2. Underwting Agreement between PacifiCorp and Barclays Capita Inc., Banc of America
Securties LLC, BNP Paribas Securties Corp. and Greenwich Capita Markets, Inc. dated
Janua 5, 2009
3. Report of Securties Issued
With regard to the use of the proceeds from the issuace of the Bonds, please see "Use of
Proceeds" on page S-8 of the enclosed Prospectus Supplement.
Under penalty ofpeijur, I declare that I know the contents of the enclosed documents, and they
are tre, correct, and complete.
Idaho Public Utilties Commission
Janua 15,2009
Page 2 of2
Please contact me if you have any questions about ths letter or the enclosed documents.
Sincerely,
'~.'rJWJ~
Bruce N. Wiliams
Vice President and Treasurer
Enclosures
Cc: Terr Carlock (Idao Commission)
Ted Weston (PacifiCorp)
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED JANUARY 9, 2008
~~~~f9BfI
$1,000,000,000 First Mortgage Bonds
$350,000,000 5.50% Series Due 2019
$650,000,000 6.00% Series Due 2039
The 2019 bonds wil bear interest at 5.50% per year and wil mature on January 15, 2019. The
2039 bonds wil bear interest at 6.00% per year and wil mature on January 15, 2039. We wil pay
interest on each series of bonds on January and July of each year, beginning on July 15, 2009.
We may redeem some or all of the bonds of either 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 the bonds on any securities 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 2019 Per 2039
Bond Thtal Bond Total
Public Offering Price(l)... . . . . ... . . . . .99.345%$347,707,500 99.050%$643,825,000
Underwriting Discount . . . . . . . . . . . . . . . .0.650%$2,275,000 0.875%$5,687,500
Proceeds to PacifiCorp (Before Expenses) . .98.695%$345,432,500 98.175%$638,137,500
(1) Plus accrued interest, if any, from January 8, 2009.
The underwriters expect to deliver the bonds to purchasers through The Depository Trust
Company on or about January 8, 2009.
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
Barclays Capital Banc of America Securities LLC
Co-Managers
BNP PARBAS RBS Greenwich Capital
Wedbush Morgan Securities Inc.
Wells Fargo Securities
Credit Suisse
Scotia Capital
SunTrust Robinson Humphrey
U.S. Bancorp Investments, Inc.
The date of this prospectus supplement is January 5, 2009.
TABLE OF CONTENTS
Pa
Prospectus Supplement
About This Prospectus Supplement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-3
Prospectus Supplement Summary .............................................. 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
Certain United States Federal Income Tax Considerations. . . . . . . . . . . . . . . . . . . . . . . . . . . .. S-12
Underwriting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. S-15
Legal Matters ............................................................ S-18
Experts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... . . . . . . . . . .. S-18
Prospectus
About This Prospectus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Risk Factors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Forward-Looking Statements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
The Company ............................................................ 2
Consolidated Ratios of Earnings to Fixed Charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Where You Can Find More Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Description of Additional Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Book-Entry Issuance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Plan of Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Legal Matters ............................................................ 12
Experts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
S-2
ABOUT THIS PROSPECTUS SUPPLEMENT
This document is in two parts. The first part is the prospectus supplement, which describes the
specific terms of the bonds we are offering and certain other matters relating to us and our financial
condition. The second part, 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 referring 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 supersedes the description in the base
prospectus.
You should rely only on the information contained in this document or to which this document
refers you. We have not, and the underwriters have not, authoried anyone to provide you with
different information. If anyone 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 the bonds. The information in this
document may only be accurate as of the 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 contex otherwise requires, the
words "Company," "we," "our," "us" and "PacifiCorp" refer to PacifiCorp, an Oregon corporation, and its
subsidiaries. References to the "Mortgage" are to the Mortgage and Deed of Trut, dated as of January 9,
1989, as amended and supplemented, with. The Bank of New York Mellon Trut Company, NA. as
successor trutee.
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
prospectu supplement contains more detailed information regarding the terms and conditions of the bonds.
The following summary is qualified in its entirety by reference to the detailed information appearig
elsewhere in this prospectu supplement and by the documents incorporated by reference into this prospectus
supplement.
ABOUT PACIFICORP
We are a United States regulated electricity company serving 1.7 milion residential, commercial,
industrial 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, wind-powered and
geothermal generating plants, as well as electric transmission and distribution 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 subsidiary 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; telephone: [phone].
S-4
THE OFFERING
Issuer ....................... PacifiCorp.
Bonds Offered . . . . . . . . . . . . . . . .. $350,00,000 aggregate principal amount of 5.50% First
Mortgage Bonds due 2019 (the "2019 bonds").
$650,000,000 aggregate principal amount of 6.00% First
Mortgage Bonds due 2039 (the "2039 bonds" and, together
with the 2019 bonds, (the "bonds").
Each of the 2019 and the 2039 bonds is a series of securities
that will be issued under a twenty-third supplement to the
Mortgage.
Ratings ...................... The 2019 bonds and 2039 are each expected to be assigned
ratings of A3 by Moody's Investors Service, Inc., A- by
Standard & Poor's Ratings Group and A- by Fitch, Inc. A
securities rating is not a recommendation to buy, sell or hold
securities and may be subject to revision or withdrawal at any
time.
Maturity Date ................. January 15, 2019 for the 2019 bonds.
January 15, 2039 for the 2039 bonds.
Interest Payment Dates. . . . . . . . . .. January 15 and July 15, commencing July 15, 2009, for each
series of bonds.
Optional Redemption . . . . . . . . . . .. We may redeem the bonds of either series, 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-annual basis (assuming a 360-day year consisting of
twelve 30-day months) at a discount rate equal to the
yield on equivalent Treasury securities plus 50 basis points
with respect to the 2019 bonds, and 50 basis points with
respect to the 2039 bonds,
plus, for (1) 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-Optional
Redemption. "
Sinking Fund . . . . . . . . . . . . . . . . .. The bonds wil not be subject to a mandatory sinking fund.
S-5
Ranking. . . . . . . . . . . . . . . . . . . . .. The bonds wil be secured by a first mortgage lien on certain
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 certain
exceptions. See "Description of the Bonds-Ranking and
Security."
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 property as an
operating system or systems capable of engaging in all or any
of the generating, transmission, distribution or other utilty
businesses described in the Mortgage. See "Description of
Additional Bonds-Certain Covenants" in the base prospectus.
Denominations . . . . . . . . . . . . . . . .. The bonds are available for purchase in minimum
denominations of $2,000 and any integral multiple of $1,00 in
excess thereof.
Use of Proceeds . . . . . . . . . . . . . . .. We intend to use the net proceeds from the sale of the bonds
to fund capital expenditures, for the repayment of short-term
debt and for general corporate purposes. See "Use of
Proceeds" in this prospectus supplement.
Trustee ...................... The Bank of New York Mellon Trust Company, N.A. wil be
the trustee for the holders of the bonds. See "Description of
Additional Bonds-The Mortgage Trustee" in the base
prospectus.
S-6
;iSK FACTORS
Investing in the bonds involves risk. Before purchasing the bonds, you should carefully consider the
risk factors included in the base prospectus, our Annual Report on Form lO-K for the year ended
December 31, 2007 (the "Form lO-K") and our Quarterly Reports on Form 10-Q for the quarterly
periods ended March 31, 2008, June 30, 2008 and September 30, 2008 (the "Forms 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
uncertainties 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.
SUMMAY CONSOLIDATED FINANCIAL INFORMTION
We have derived the summary 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 nine-month periods ended September 30,2008 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 lO-K and the Forms lO-Q, incorporated by reference
herein.
Consolidated Statement of Income
Information:
Revenues. . . . . . . . . . . . . . . . . . . .
Operating income. . . . . . . . . . . . . .
Net income. . . . . . . . . . . . . . . . . .
Other Consolidated Financial
Information:
Net cash from operating activities . .
Net cash from investing activities. . .
Net cash from financing activities ..
Nine-Month Nine-MonthPenods Ended Year Ended Penod Ended Year EndedSeptember 30,December 31,Deember 31,March 31,
2008 2007 2007 200(1)200
(in milions)
$ 3,395 $ 3,190 $ 4,258 $ 2,924 $ 3,897
715 671 888 415 792
339 339 439 161 361
$752 $650 $824 $431 $895
(1,404)(1,112)(1,497)(1,056)(1,024)
493 459 842 564 50
As of September 30,As of December 31,As of March 31,
2008 2007 200 200
(in milions)
Consolidated Balance Sheet Information:
Total assets. . . . . . . . , . . . . . . . . . . . . . . . . . . .
Total debt(2) ..........................
Total shareholders' equity . . . . . . . . . . . . . . . . .
$16,064
5,222
5,626
$14,907
4,753
5,080
$13,852
3,967
4,426
$12,731
3,721
4,052
(1) Following the acquisition of PacifiCorp by MEHC on March 21, 2006, we elected to change our
fiscal year end from March 21 to December 31, resulting in a nine-month transition period from
April 1, 2006 to December 31, 2006.
(2) Includes capital lease obligations, but excludes current maturities, short-term debt 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 to fund capital expenditures, for the
repayment of short-term debt and for general corporate purposes.
CAPITALIZATION
The table below shows our capitaliiation on a consolidated basis as of September 30, 2008. The
'~s Adjusted" column wil reflect our capitalization as of that date after giving effect to this offering of
bonds and the use of the net proceeds from this offering. You should read this table along with the
Consolidated Financial Statements contained in the Form lO-K and the Forms lO-Q.
As of September 30, 2008
Actual As Adjusted
Amounts Amountsin milions % in milions %
Short-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Long-term debt, currently maturing(l) . . . . . . . . . . . . . . . . . . . . .
Long-term debt, net of current maturities(l) . . . . . . . . . . . . . . . .
$ 117
142
5,222
5,481
41
5,585
$11,107
Preferred stock .....................................
Total common equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1.1% $
1.3 142
47.0 6,222
49.4 6,364
0.3 41
50.3 5,5S5
100% $11,990
0.0%
1.2
51.9
53.1
0.3
46.6
100.0%
(1) Includes capital lease obligations.
During the three months ended December 31, 2008, we received cash capital contributions of
$250 milion from our indirect parent company, MERe. At December 31, 200S, short-term debt was
$85 milion and long-term debt, including current maturities, was $5,56S milion.
CONSOLIDATED RATIOS OF EARINGS TO FIXED CHAGES
Years Ended
Pro forma(1 Pro forma(l)March 31,
Nine Months Ended Nine Months Ended Year Ended Year Ended Nine Months Ended
September 30, 2008 September 30, 2008 December 31, 200 December 31, 2007 December 31,200(2)200 2005 200
2.6x 3.Ox 2.6x 3.0x 2.1x 2.9x 2.5x 2.4x
(1) The pro forma ratio of earnings to fixed charges gives pro forma effect to the net incremental
interest expense related to the anticipated repayment of outstanding short-term debt with a portion
of the net proceeds from the sale of the bonds.
(2) Following the acquisition of PacifiCorp by MERC 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 purposes 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 tax
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) undistributed income of less than 50% owned affiliates without loan guarantees.
S-S
DESCRIPTON OF THE BONDS
The bonds will be issued pursuant to the twenty-third supplemental indenture to the Mortgage, to
be dated as of January 1, 2009 (the "Supplemental Indenture"). The terms of the bonds include those
stated in the Mortgage, the Supplemental Indenture and those made part of the Mortgage by reference
to the Trust Indenture Act of 1939, as amended.
Set forth below is a description of the 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 Indenture. 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 Indenture.
General
The bonds wil be issued as two separate series of First Mortgage Bonds under the Mortgage. The
2019 bonds wil initially be limited in aggregate principal amount to $350,000,000. The 2039 bonds wil
initially be limited in aggregate principal amount to $650,000,000. The entire principal amount of the
2019 bonds wil mature and become due and payable, together with any accrued and unpaid interest
thereon, on January 15, 2019. The entire principal amount of the 2039 bonds wil mature and become
due and payable, together with any accrued and unpaid interest thereon, on January 15, 2039. 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 2019 bond wil bear interest at the rate of 5.50% per annum from the date of original
issuance. Each 2039 bond will bear interest at the rate of 6.00% per annum from the date of original
issuance. Interest on each series of bonds wil be payable semi-annually in arrears on January 15 and
July 15 of each year (each, an "Interest Payment Date"). The initial Interest Payment Date is July 15,
2009. The amount of interest payable wil 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-entry 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 are not all in book-entry form, the record date for each Interest Payment Date wil be the
close of business on the first calendar day of the month in which the applicable Interest Payment Date
occurs (whether or not a business day).
Ranking and Security
The bonds wil 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 construction liens, purchase money liens and certain other exceptions.
The bonds wil be equally and ratably secured with all other bonds issued under the Mortgage.
Further Issuances
The 2019 bonds will initially be limited in aggregate principal amount to $350,000,000. The 2039
bonds wil initially be limited in aggregate principal amount to $650,000,000. We may, from time to
time, without notice to or the consent of the holders of the bonds, create and issue further bonds equal
S-9
in rank and having the same maturity, payment terms, redemption features, CUSIP numbers and other
terms as either or both series of bonds offered by this prospectus supplement, except for the issue
price, payment of interest accruing prior to the issue date of the further bonds and, under some
circumstances, for the first payment of interest following the issue date of the further bonds. These
further bonds may be consolidated and form a single series with either series of the bonds offered by
this prospectus supplement.
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 of the 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 Treasury Rate, plus SO basis points with
respect to the 2019 bonds, and SO basis points with respect to the 2039 bonds, in each case, as
calculated by an Independent Investment Banker;
plus, in either of the above cases, accrued and unpaid interest thereon to the redemption date.
We wil mail a notice of redemption at least 30 days before the redemption date to each holder of
bonds to be redeemed. If we elect to partially redeem the bonds of either series, the Trustee will 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
wil 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,
appearing in the most recently published statistical release designated "H.lS(SI9)" 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 securities
adjusted to constant maturity under the caption "'feasury Constant Maturities," for the maturity
corresponding to the Comparable Treasury Issue (if no maturity is within three months before or
after the Remaining Life, yields for the two published maturities most closely corresponding to
the Comparable Treasury Issue wil be determined and the Adjusted Treasury Rate will 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 maturity of the Comparable Treasury Issue, calculated using a price for the
Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the
Comparable Treasury Price for such redemption date.
The Adjusted Treasury Rate wil be calculated on the third business day preceding the redemption
date.
"Comparable Treasury Issue" means the United States Treasury security selected by an Independent
Investment Banker as having a maturity comparable to the remaining term of the bonds to be
redeemed that would be used, at the time of selection and in accordance with customary financial
S-lO
practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining
term of such bonds ("Remaining Life").
"Comparable Treasury Price" means, with respect to any redemption date, (1) the average of four
Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest
Reference Treasury Dealer Quotations, or (2) if the Independent Investment Banker obtains fewer than
four such Reference Treasury Dealer Quotations, the average of all such quotations.
"Independent Investment Banker" means one of the Reference Treasury Dealers appointed by us, or
if that firm is unwiling or unable to serve as such, an independent investment and banking institution
of national standing appointed by us.
"Reference Treasury Dealer" means:
· each of Banc of America Securities LLC, Barclays Capital Inc., BNP Paribas Securities. Corp.
and Greenwich Capital Markets, Inc., and their respective succssors; provided that, if one of
these parties ceases to be a primary U.S. Government securities dealer in New York City
("Primary Treasury Dealer"), we wil substitute another Primary Treasury Dealer; and
· any other Primary Treasury Dealers selected by us.
"Reference Treasury Dealer Quotations" means, with respect to each Reference Treasury Dealer and
any redemption date, the average, as determined by the Independent Investment Banker, of the bid
and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its
principal amount) quoted in writing 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 FEDERA 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
purport to be a complete analysis of all potential tax effects. This discussion does not address all the
U.S. federal income tax consequences that may be relevant to a holder in light of such holder's
particular circumstances or to holders subject to special rules, such as financial institutions, banks,
partnerships and other pass-through entities, U.S. expatriates, controlled foreign corporations, passive
foreign investment companies, insurance companies, dealers in securities or currencies, traders in
securities, U.S. Holders (defined below) whose functional currency 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. Treasury 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 Internal Revenue Servce ("IRS") with
respect to the matters discussed below. There can be no assurance that the IRS wil 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 purposes of this discussion, the term "U.S. Holder" means a beneficial owner of the bonds
that is for U.S. federal income tax purposes:
· an individual citizen or resident of the 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
District of Columbia;
· an estate, the income of which is subject to U.S. federal income tax regardless of its source; or
· a trust if (a) a U.S. court can exercise primary supervsion over the administration of the trust
and one or more U.S. persons can control all substantial trust decisions or (b) if the trust 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 purposes.
For U.S. federal income tax purposes, if a partnership (including any entity or arrangement
classified as a partnership for U.S. federal income tax purposes) is a beneficial owner of the bonds, the
treatment of a partner in the partnership generally wil depend upon the status of the partner and the
activities of the partnership. A beneficial owner of the bonds that is a partnership for U.S. federal
income tax purposes, and the partners in such partnership, should consult their tax advisors about the
U.S. federal income tax consequences relating to the ownership and disposition of the bonds.
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u.s. Holders
The following discussion is a summary of the U.S. federal income tax consequences relevant to a
U.S. Holder.
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 purposes.
If we call the bonds for redemption (see "Description of the Bonds-ptional 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 wil be
obligated to make these additional payments is remote. Remote contingencies are not taken into
account unless and until they occur. Our determination that this contingency is remote is binding on
U.S. Holders unless they disclose a contrary position in the manner required by applicable Treasury
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
purposes.
Sale or Other Taxble Disposition of the Bonds
A U.S. 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 property received upon the disposition (less any amount attributable to
accrued but unpaid interest, which will 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 wil be long-term capital gain or
loss if the U.S. Holder held the bond for more than one year. Long-term capital gains of non-corporate
taxayers are taxed at lower standard rates than those applicable to ordinary income. A U.S. Holder's
abilty to deduct capital losses may be limited.
Non-U.S. Holders
The following discussion is a summary of the U.S. federal income tax consequences relevant to a
Non-U.S. Holder.
Interest
Interest paid to a Non-U.S. Holder generally wil not be subject to U.S. federal withholding tax,
provided that:
· the Non-U.S. Holder does not actually or constructively own 10% or more of the total combined
voting power of all classes of our stock entitled to vote;
· the Non-U.S. Holder is not a controlled foreign corporation that is related to us actually or
constructively through stock ownership;
· the Non-U.S. Holder is not a bank receiving certain tyes 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.
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Interest that meets these requirements is referred to as "portfolio interest" and, in addition to
generally not being subject to U.S. federal withholding tax is also generally not subject to regular U.S.
federal income tax unless the conditions of the following paragraph apply to such Non-U.S. Holder.
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 the Non-US. Holder of a United States trade or business, and (ii) if an income tax treaty
applies, the interest is attributable 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 trade 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.
Sale or Other Taxble Disposition of the Bonds
Gain realized by a Non-U.S. Holder on the sale, redemption or other taxable disposition of a bond
generally wil 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 attributable 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 certain other conditions are satisfied.
Gain recognized by a Non-U.S. Holder upon a sale, redemption or other taxable disposition of a
bond that is effectively connected with the conduct by the Non-US. 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 wil be subject to US. 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 corporation, such gain
may also be subject to the branch profits tax at a rate of 30% (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 nnless, in
certain cases, the recipient of the payment supplies an accurate taxpayer identification number or
otherwise complies with applicable United States information reporting or certification requirements.
Any amount withheld under the backup withholding rules is allowable as a credit against the holder's
United States federal income tax, provided that the required information is timely furnished to the IRS.
PERSONS CONSIDERING THE PURCHASE OF THE BONDS SHOULD CONSULT THEIR OWN
TAX ADVISORS WITH RESPECT TO THE UNITED STATES FEDERA INCOME TAX
CONSEQUENCES OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF BONDS IN LIGHT
OF THEIR PARTICULAR CIRCUMSTANCES, AS WELL AS THE EFFECT OF AN STATE, LOCAL
OR FOREIGN TAX LAWS OR AN APPLICABLE TAX TREATY.
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UNDERWRING
We have entered into an underwriting agreement with the underwriters named below with respect
to the bonds. Subject to certain conditions, each underwriter has severally agreed to purchase the
principal amount of bonds indicated in the following table:
Underwters
Barclays Capital Inc. ...................................
Banc of Amenca Securities LLC .. . . . . . . . . . . . . . . . . . . . . . . . . .
BNP Paribas Securities Corp. .............................
Greenwich Capital Markets, Inc. ............. . . . . . . . . . . . . . .
Wedbush Morgan Securities Inc. ...........................
Wells Fargo Securities, LLC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Credit Suisse Securities (USA) LLC. . . . . . . . . . . . . . . . . . . . . . . . .
Scotia Capital (USA) Inc. ................................
SunTrust Robinson Humphrey, Inc. .........................
U.S. Bancorp Investments, Inc. ............................
Total. . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Principal Amount
of 2019 Bonds
$ 63,000,000
63,000,000
63,000,000
63,000,000
28,000,000
28,000,000
10,500,000
10,500,000
10,500,000
10,500,000
$350,000,000
Principal Amount
of 2039 Bonds
$117,000,000
117,000,000
117,000,00
117,000,000
52,000,000
52,000,000
19,500,000
19,500,000
19,500,000
19,500,000
$650,000,000
The underwriting agreement provides that the obligations of the underwriters to purchase the
bonds included in this offering are subject to approval of legal matters by counsel and to other
conditions. The underwriters are obligated to purchase all the bonds if they purchase any of the bonds.
The underwriters propose to offer the bonds directly to the public at the public offering price set
forth on the cover page of this prospectus supplement. The underwriters may offer the 2019 bonds to
dealers at such price less a concession not in excess of 0.400% of the principal amount of the
2019 bonds and may offer the 2039 bonds at such price less a concession not in excess of 0.500% of the
principal amount of the 2039 bonds. The underwriters may allow, and such dealers may reallow, a
discount not in excess of 0.250% of the principal amount of each of the 2019 bonds and the
2039 bonds to certain other brokers and dealers. Afer the initial offenng of the bonds to the public,
the public offering price and concessions may be changed.
The bonds are a new issue of securities with no established trading market. We have been advised
by the underwriters that the underwriters 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 underwriters may purchase and sell the bonds in the open
market. These transactions may include short sales, stabilzing transactions and purchases to cover
positions created by short sales. Short sales involve the sale by the underwriters of a greater number of
bonds than they are required to purchase in the offering. Stabilizing transactions consist of certain bids
or purchases made for the purpose of preventing or retarding a decline in the market price of the
bonds while the offering is in progress.
The underwriters may also impose a penalty bid. This occurs when a particular underwriter repays
to the underwnters a portion of the underwriting discount received by it because another underwriter
has repurchased bonds sold by or for the account of such underwriter in stabilzing or short covering
transactions.
These activities by the underwriters, as well as other purchases by the underwriters for their own
accounts, may stabilze, 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 otherwise would exist in the open market. If these
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activities are commenced, they may be discontinued by the underwriters at any time. These transactions
may be effected in the over-the-counter market or otherwise.
We estimate that our total offering expenses, not including the underwriting discount, wil be
approximately $650,000.
UnionBanc Investment Services LLC, a Financial Industry Regulatory Authority member and
subsidiary of Union Bank of California, N.A., is being paid a referral fee by Wedbush Morgan
Securities Inc.
Certain of the underwriters and their affilates have performed commercial banking, investment
banking 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 underwriters act as agents and as lenders under our
credit facilities, which we may repay from time to time with proceeds of the offering and for which they
receive customary fees and expenses. The underwriters may, from time to time, engage in transactions
with and perform services for us or our affilates in the ordinary course of their business.
We have agreed to indemnify each of the underwriters against certain liabilties, including liabilties
under the Securities Act of 1933, or to contribute to payments the underwriters 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, à "Relevant Member State"), each underwriter 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 will not make an
offer of the bonds to the public in that Relevant Member State, other than:
(a) to legal entities which are authorised or regulated to operate in the financial markets or,
if not so authorized or regulated, whose corporate purpose is solely to invest in securities;
(b) 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 €SO,OOO,OOO, as shown in its last annual or consolidated accounts;
(c) 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 Banc of America Securities
LLC, Barclays Capital Inc., BNP Paribas Securities Corp., Greenwich Capital Markets, Inc.; or
(d) in any other circumstances fallng within Aricle 3(2) of the Prospectus Directive;
provided that no such offer of the bonds shall require us or any underwriter to publish a
prospectus pursuant to Aricle 3 of the Prospectus Directive.
For the purposes of this provision, the expression an "offer of the 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 of the 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 2oo3/71ÆC and includes any relevant implementing measure in
each Relevant Member State.
Each underwriter has represented and agreed that:
(a) it has only communicated or caused to be communicated (and wil 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 & Market Act (the "FSMÆ')) received by it in
connection with the issue or sale of the bonds in circumstances in which Section 21(1) of the
FSMA does not apply to us; and
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(b) it has complied and wil comply with all applicable provisions of the FSMA with respect
to anything done by it in relation to the bonds in, from or otherwse 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 Securities
and Futures Ordinance (Cap.S71, 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 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 bonds 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 Securities
and Futures Ordinance (Cap. 571, Laws of Hong Kong) and any rules 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 underwriter has agreed that it will 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 registration 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 prospectus 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 Securities and Futures Act, Chapter 289 of Singapore (the "SFA"), (ii) to a relevant
person, or any person pursuant to Section 27S(IA), and in accordance with the conditions, specified in
Section 275 of the SFA or (iii) otherwise pursuant to, and in accordance with the conditions of, any
other applicable provision of the SFA.
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 trust (where the trustee is not an accredited investor) whose sole purpose
is to hold investments and each beneficiary is an accredited investor, shares, debentures and units of
shares and debentures of that corporation or the beneficiaries' rights and interest in that trust shall not
be transferable for 6 months after that corporation or that trust 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 27S(IA), and in accordance with the conditions, specified in
Section 275 of the SFA; (2) where no consideration is given for the transfer; or (3) by operation of law.
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LEGAL MATTERS
Certain legal matters with respect to the bonds we are offering wil be passed upon for us by
Mark C. Moench, General Counsel of PacifiCorp, and by Perkins Coie LLp, Portland, Oregon. Certain
legal matters wil be passed upon for the underwriters by Latham & Watkins LLp, New York, New
York. Latham & Watkins LLP from time to time represents us or certain of our affilates.
EXPERTS
The consolidated financial statements of PacifiCorp 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 1O-K, 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 SFAS No. 158, Employers'
Accounting for Defined Benefit Pension and Other Postretirement Plans-an amendment of FASB
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 September 30,
2007, March 31, 2008, June 302008 and September 30, 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 reports included in the
Forms lO-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 information should be restricted 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 Securities 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 of PacifiCorp and its subsidiaries for the year ended March 31, 2006 incorporated in
this prospectus supplement by reference to the Form lO-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.
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PROSPECTS
PACIFICORP
FIRST MORTGAGE BONDS
PacifiCorp, an Oregon corporation, may from time to time offer First Mortgage Bonds
('~dditional Bonds" or "Securities") in one or more issuances or series at prices and on terms to be
determined at the time of sale.
We will provide specific terms of the Securities, including, as applicable, the amount offered,
offering prices, interest rates, maturities 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 Securities directly through agents designated from time to time or through
underwriters or dealers. The supplements to this prospectus will describe the terms of any particular
plan of distribution, including any underwriting 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 onr Secnrities.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR AN STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR
DETERMINED IF THIS PROSPECTS IS TRUTHFUL OR COMPLETE. AN
REPRESENTATION TO THE CONTY IS A CRIMINAL OFFENSE.
This prospectus may not be used to consummate sales of Securities unless accompanied by a prospectus
supplement relating to the Securities offered.
The date of this prospectus is January 9, 200S.
TABLE OF CONTENTS
ABOUT THIS PROSPECTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
RISK FACTORS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
FORWAR-LOOKING STATEMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
THE COMPAN ......................................................... 2
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHAGES. . . . . . . . . . . . . . . . . . . 3
WHERE YOU CAN FIND MORE INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
USE OF PROCEEDS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
DESCRIPTION OF ADDITIONAL BONDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
BOOK-ENTRY ISSUANCE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
PLA OF DISTRIBUTION ................................................. 11
LEGAL MATTRS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
EXPERTS............................................................... 12
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 Securities and we are not soliciting offers to buy the Securities in any
jurisdiction in which offers are not permitted.
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that PacifiCorp fied with the Securities 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 prospectus provides a general description of the Securities. Each time we sell Securities,
we wil provide a prospectus supplement that wil contain specific information about the terms of that
offering. That prospectus supplement may include or incorporate by reference a detailed and current
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 Information." If there 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 otherwise indicated or unless the context otherwise 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 Securities, 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 filings listed in the registration statement. See "Where You Can Find More
Information. "
RISK FACTORS
Investing in our Securities Ìnvolves risk. Before purchasing any Securities we offer, you should
carefully consider the risk factors described in our periodic reports fied 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 Securities. See "Forward-Looking Statements" and "Where You Can
Find More Information" in this prospectus. Additional risks and uncertainties that are not yet
identified or that we currently 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 wil secure any Additional Bonds. The value of the collateral in the event of liquidation wil
depend on market and economic conditions, the availabilty 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
sufficient to satisfy the amounts outstanding 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 sufficient 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.
1
There is no existing market for the Securities, and we cannot assure you that an active trading market
for the Securities will develop.
We do not intend to apply for listing of the Securities on any securities exchange or automated
quotation system. There can be no assurance as to the liquidity of any market that may develop for the
Securities. Accordingly, the abilty of holders to sell the Securities that they hold or the price at which
holders wil be able to sell the Securities may be limited. Future trading prices of the Securities will
depend on many factors, including, among other things, prevailng interest rates, our operating results
and the market for similar securities.
We do not know whether an active trading market will develop for the Securities. 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.
FORWAR-LOOKING STATEMENTS
This prospectus, any accompanying prospectus supplement and the additional information
described under the heading "Where You Can Find More Information" may contain "forward-looking
statements" within the meaning of Section 27 A of the Securities Act and Section 21E of the Exchange
Act, which are subject to the safe harbor created by the Private Securities Litigation Reform Act of
1995. All statements other than statements of historical fact are "forward-looking statements" for
purposes of these provisions. Examples include discussions as to our expectations, beliefs, plans, goals,
objectives and future financial or other performance or assumptions concerning matters discussed,
including through incorporation by reference, in this prospectus. This information, by its nature,
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 difficult to predict, involve uncertainties that
may materially affect actual results and are often beyond our ability to control. We have identified a
number of these factors in our filngs with the SEC, including the Form 10-K, the Forms lO-Q and the
Forms 8-K incorporated by reference in this prospectus, and we refer you to those reports for further
information.
Any forward-looking statement speaks only as of the date on which it is made, and we undertake
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 cautionary statements.
THE COMPAN
We are a regulated electricity company serving residential, commercial, industrial 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 distribution 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 subsidiary 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.
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Our address and telephone number are: PacifiCorp, 825 NE Multnomah, Suite 2000, Portland,
Oregon 97232-4116; [phone].
For additional information concerning our business and affairs, 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 prospectus, as described in the section entitled "Where You Can
Find More Information" and the documents incorporated by reference therein.
CONSOLIDATED RATIOS OF EARINGS TO FIED CHAGES
Nine Months Ended
September 30, 2007
3.1x
Nine Months Ended
December 31, 200(1)
2.1x
200
2.9x
Years Ended March 31,
2005 200
2.5x 2Ax
2003
1.7x
(1) Following the acquisition of PacifiCorp 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 transition period from April 1, 2006 to December 31, 2006.
For purposes 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 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) undistributed income of less than 50% owned affiliates without loan
guarantees.
WHERE YOU CAN FIND MORE INFORMTION
This prospectus is part of a registration statement fied with the SEC. The registration statement
contains additional information and exhibits not included in this prospectus and refers to documents
that are filed as exhibits to other SEC filings. We file annual, quarterly and special reports and other
information with the SEC. Our SEC filngs are available to the public over the Internet at the SEC's
web site at http://www.sec.gov. You may also read and copy any document we file at the SEC's Public
Reference Room at 100 F Street, N.B., Room 1580, Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330 for further information regarding the public reference rooms. Our SEC filngs are also
available through the Investor Information section of our website at wwpacificorp.com. The
information found on our website, other than any of our SEC fiings that are incorporated by reference
herein, is not part of this prospectus.
The SEC allows us to "incorporate by reference" the information we fie with them, which means
that we can disclose important information to you by referring 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 future fiings made with the SEC under Sections 13( a),
13(c), 14, or IS(d) of the Securities Exchange Act of 1934 (the "Exchange Act") (but only to the extent
the information therein is filed and not furnished) until all of the securities covered by this prospectus
have been sold:
· Transition Report on Form lO-K for the nine-month period ended December 31, 2006.
· Quarterly Reports on Form lO-Q for the quarters ended March 31, 2007, June 30, 2007 and
September 30, 2007.
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· Current 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 filngs (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 97232-4116
Telephone: [phone]
Attention: Treasury
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 underwriters, agents or dealers have
not, authorized anyone else to provide you with different information. We are not, and any
underwriters, agents or dealers are not, making an offer of these Securities in any state where the offer
or sale is not permitted. You should not assume that the information contained in this prospectus 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 accurate as of any
date other than the date on the front of those documents.
USE OF PROCEEDS
Unless otherwise indicated in a prospectus supplement, the net proceeds to be received by us from
the issuance and sale of the Securities will initially become part of our general funds and wil be used
to repay all or a portion of our short-term borrowings outstanding at the time of issuance of the
Securities or may be applied to utility asset purchases, capital expenditures or other corporate
purposes, including the refunding of long-term debt.
DESCRIPTON 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 Bank of New York
(as successor trustee to JPMorgan Chase Bank, N.A.) (the "Mortgage Trustee"). The following
summary 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 particular provisions or defined terms in the
Mortgage are referred to herein, those provisions or defined terms are incorporated by reference
herein. Section and Aricle references used below are references to provisions of the Mortgage unless
otherwise 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 taxes or
other governmental charges, at the offices of the Mortgage Trustee, New York, New York. Any
Additional Bonds issued will be equally and ratably secured with all other bonds issued under the
Mortgage. See "Book-Entry Issuance."
Maturity and Interest Payments
Reference is made to the prospectus supplement relating to any Additional Bonds for the date or
dates on which those Additional Bonds wil mature, the rate or rates per annum at which those
4
Additional Bonds wil bear interest and the times at which any interest wil be payable. These terms
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 issuance 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 of
the 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 Mortgaged
and Pledged Property, the Mortgage does not permit redemption of bonds pursuant to these provisions.
There is no sinking or analogous fund 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, Article XII and Section 13.06)
Security and Priority
The Additional Bonds will be issued under the Mortgage and secured by a first mortgage lien on
certain utilty propert owned from time to time by us and/or by Class ''j' Bonds, if any, held by the
Mortgage Trustee.
There are excepted from the lien of the Mortgage all cash and securities (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; electric energy,
gas, water, steam and other products for sale, distribution or other use; natural gas wells; gas
transportation lines or other property used in the sale of natural gas to customers or to a natural gas
distribution or pipeline company, up to the point of connection with any distribution 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 Utah 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
construction 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-electric 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 surviving corporation), conveyance or transfer of all or substantially all of the utility propert of
another electric utility company to us or sale of substantially all of our assets. (Section 18.03) In
addition, after-acquired property may be subject to a Class "PC Mortgage, purchase money mortgages
and other liens or defects in title.
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The Mortgage provides that the Mortgage Trustee shall have a lien upon the mortgaged property,
prior to the holders of bonds, for the payment of its reasonable compensation and expenses and for
indemnity against certain liabilities. (Section 19.09)
Issuance of Additional Bonds
The maxmum 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 Property Additions after adjustments to offset retirements;
(2) Class ''/' Bonds (which need not bear interest) delivered to the Mortgage Trustee;
(3) retirement of bonds or certain prior lien bonds; and/or
(4) deposits of cash.
With certain exceptions in the case of clauses (2) and (3) above, the issuance of bonds is subject to
our Adjusted Net Earnings for 12 consecutive months out of the preceding 15 months, before income
taxes, being at least twce the Annual Interest Requirements on all bonds at the time outstanding, all
outstanding Class ''/' 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 Articles IV through
VII)
Property Additions generally include electric, gas, steam and/or hot water utilty propert but not
fuel, securities, automobiles, other vehicles or aircraft, or property used principally for the production
or gathering of natural gas. (Section 1.04)
The issuance of bonds on the basis of Propert Additions subject to prior liens is restricted. Bonds
may, however, be issued against the deposit of Class ''/' Bonds. (Sections 1.04 through 1.06 and
Articles IV and V)
Release and Substitution of Property
Property subject to the lien of the Mortgage may be released upon the basis of:
(1) the release of that property from the lien of a Class ''/' Mortgage;
(2) the deposit of cash or, to a limited extent, purchase money mortgages;
(3) Property Additions, after making adjustments for certain prior lien bonds outstanding against
Property 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. Property that does not
constitute Funded Property, as defined in Section 1.05 of the Mortgage, may be released without
substituting other Funded Property. Similar provisions are in effect as to cash proceeds from such
propert. The Mortgage contains special provisions with respect to certain 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 through 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 property that is of the same character as Property Additions, as defined in the Mortgage, an
6
existing mortgage constituting a first lien on operating properties of that other company may be
designated by us as a Class ''P' Mortgage. (Section 11.06) Bonds thereafter issued pursuant to the
additional mortgage would be Class ''P' 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 property as an operating system or systems
capable of engaging in all or any of the generating, transmission, distribution or other utilty 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 lO-K incorporated by reference herein for
information relating to other restrictions.
Foreign Currency Denominated Bonds
The Mortgage authorizes the issuance of bonds denominated in foreign currencies, provided that
we deposit with the Mortgage Trustee a currency 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 currency exchange fluctuation as is
usually obtained by similarly situated borrowers. (Section 2.03) We believe that this type of currency
exchange agreement will provide effective protection against currency exchange fluctuations. However,
if the other party to the exchange agreement defaults and the foreign currency is valued higher at the
date of maturity 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 Bank of New York may act as a lender, trustee or agent under other agreements and
indentures involving us and our affilates.
Modification
The rights of bondholders may be modified with the consent of holders of at least 60% of the
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 of the 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 ''P' bonds held by it with respect to any amendment of the applicable Class ''P' Mortgage
proportionately with the vote of the holders of all Class ''P' Bonds then actually voting. (Section 11.03)
7
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 fund required to be applied
to the purchase or redemption of any bonds;
(3) default in payment of principal or interest with respect to certain prior lien bonds;
(4) certain 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 oW' Mortgage that permits the declaration of the
principal of all the bonds secured by the Class oW' Mortgage and the interest accrued
thereupon due and payable. (Section 15.01)
An effective default under any Class oW' Mortgage or under the Mortgage wil result in an
effective default under all those mortgages. The Mortgage Trustee may withhold notice of default
(except in payment of principal, interest or funds for retirement of bonds) if it determines that it is not
detrimental to the interests of the bondholders. (Section 15.02)
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 MortgageTrustee written notice of a Default and unless the holders of 25% of the bonds have requested in
writing the Mortgage Trustee to act and offered it reasonable opportunity to act and indemnity
satisfactory to it against the costs, expenses and liabilities to be incurred thereby and the Mortgage
Trustee shall have failed to act. (Section 15.16) The holders of a 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 trust or power conferred on the Mortgage Trustee. (Section 15.07) The
Mortgage Trustee is not required to risk its funds 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 will 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 trust,
moneys or government 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 maturity date
thereof, as the case may be. The Mortgage Trustee 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 recognize income, gain or loss for federal income tax purposes as
a result of the 'deposit, and/or ensuing discharge and wil be subject to federal income tax on the same
amount and in the same manner and at the same times, as would have been the case if the deposit,
and/or discharge had not occurred. (Section 20.02)
Upon the deposit, our obligation to pay the principal of (and premium, if any) and interest on
those bonds shall cease, terminate 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)
8
BOOK-ENTRY ISSUANCE
Unless otherwise specified in the applicable prospectus supplement, The Depository Trust
Company ("DTC") will act as securities depositary for each series of the Additional Bonds. The
Additional Bonds wil be issued as fully registered securities registered in the name of Cede & Co.
(DTC's partnership nominee) or such other name as may be requested by an authorized representative
of DTC. One fully registered certificate wil be issued for each issue of the Additional Bonds,
representing the aggregate principal amount of each series of Additional Bonds, and wil be deposited
with DTC. If, however, the aggregate principal amount of any issue exceeds $500,000,000, one
certificate will 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-purpose trust company organized under the New York Banking Law, a "banking
organization" within the meaning of the New York Banking Law, a member of the Federal Reserve
System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and
a "clearing agency" registered pursuant to the provisions of Section 17 A of the Exchange Act. DTC
holds securities that its participants ("Direct Participants") deposit with DTC. DTC also facilitates the
post-trade settlement among Direct Participants of sales and other securities transactions, such as
transfers and pledges, in deposited securities through electronic computerized book-entry transfers and
pledges between Direct Participants' accounts, thereby eliminating the need for physical movement of
securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers,
banks, trust companies, clearing corporations and some other organizations. DTC is a wholly owned
subsidiary of The Depository Trust & Clearing Corporation ("DTCC"), which, in turn, is owned by a
number of Direct Participants of DTC and Members of the National Securities Clearing Corporation,
Fixed Income Clearing Corporation and Emerging Markets Clearing Corporation (NSCC, FICC and
EMCC, also subsidiaries of DTCC), as well as by the New York Stock Exchange, Inc., the American
Stock Exchange LLC, and the National Association of Securities 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,
trust companies, and clearing corporations that clear through or maintain a custodial relationship with
a Direct Participant, either directly or indirectly ("Indirect Participants," and together with Direct
Participants, "Participants"). DTC has Standard & Poor's highest rating: AA. The DTC Rules
applicable to its Participants are on file 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
Participants, which will receive a credit for the Additional Bonds on DTC's records. The ownership
interest of each actual purchaser of each Additional Bond ("Beneficial Ower") is in turn to be
recorded on the Direct and Indirect Participants' records. Beneficial Owners will not receive written
confirmation from DTC of their purchases, but Beneficial Owners are expected to receive written
confirmations providing details of the transactions, as well as periodic statements of their 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 entries
made on the books of Participants 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-entry system for the Additional Bonds is discontinued.
To facilitate subsequent transfers, all Additional Bonds deposited by Direct Participants with DTC
are registered in the name of DTC's partnership nominee, Cede & Co., or such other name as may be
requested by an authorized representative of DTC. The deposit of Additional Bonds with DTC and
their registration 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 Participants to whose accounts those
9
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 proposed amendments to 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.
If less than all of the Additional Bonds are being redeemed, DTC's practice is to determine by lot the
amount of the interest of each Direct Participant in such issue.
Neither DTC nor Cede & Co. (nor any other DTC nominee) wil consent or vote with respect to
Additional Bonds unless authorized by a Direct Participant in accordance with DTC's procedures.
Under its usual procedures, DTC mails an omnibus proxy (the "Omnibus Proxy") to the Mortgage
Trustee after the record date. The Omnibus Proxy assigns Cede & Coo's consenting or voting rights to
those Direct Participants 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 Trustee to Cede & Co. or such
other nominee as may be requested by an authorized representative of DTC. 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 instructions and customary practices and
wil be the responsibility of the Participant and not of DTC (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 responsibilty of DTC, and disbursements of the payments to the Beneficial
Owners is the responsibilty of Direct and Indirect Participants.
DTC may discontinue providing its services 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 of the system of book-entry only transfers through DTC or any
successor depositary. In that event, Additional Bond certificates wil be printed and delivered to DTC.
The information in this section concerning DTC and DTC's book-entry system has been obtained
from sources that we believe to be accurate, but we assume no responsibilty for the accuracy 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.
10
PLA OF DISTRIBUTION
We may sell the Securities through underwriters, dealers or agents, or directly to one or more
purchasers. The prospectus supplement with respect to the Securities being offered wil set forth the
specific terms of the offering of those Securities, including the name or names of any underwriters,
dealers or agents, the purchase price of those Securities and the proceeds to us from the sale, any
underwriting discounts, agency fees and other items constituting underwriters' or agents' compensation,
any initial public offering price and any discounts or concessions allowed or reallowed or paid to
dealers.
If we use underwriters to sell Securities, we wil enter into an underwriting agreement with the
underwriters. Those Securities wil be acquired by the underwriters 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
prevailing at the time of sale, at prices related to such prevailing market prices or at negotiated prices.
The underwriter or underwriters with respect to a particular underwritten offering of Securities wil be
named in the prospectus supplement relating to that offering and, if an underwriting syndicate is used,
the managing underwriter or underwriters wil be set forth on the cover page of the prospectus
supplement. Any underwriting compensation paid by us to the underwriters or agents in connection
with an offering of Securities, and any discounts, concessions or commissions allowed by underwriters
to dealers, wil be set forth in the applicable prospectus supplement to the extent required by
applicable law. Unless otherwise set forth in the prospectus supplement, the obligations of the
underwriters to purchase the Securities wil be subject to specific conditions, and the underwriters wil
be obligated to purchase all of the offered Securities if any are purchased.
If a dealer is used in the sale of any Securities, we will sell those Securities to the dealer, as
principaL. 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 Securities
and any discounts or concessions allowed or reallowed or paid to the dealer wil be set forth in the
prospectus supplement relating to that offering.
The Securities may be sold directly by us or through 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 underwriter as that term is defined in the Securities 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 forth, in the prospectus supplement relating to that offer or sale. Unless
otherwise indicated in the prospectus supplement, any agent wil be acting on a reasonable best efforts
basis for the period of its appointment.
If so indicated in an applicable prospectus supplement, we wil authorie dealers acting as our
agents to solicit offers by certain specified institutions to purchase Securities from us at the public
offering 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 future. Each
Contract 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 charitable
institutions and other institutions, but wil in all cases be subject to our approvaL. Contracts wil not be
subject to any conditions except (i) the purchase by an institution of the Securities covered by its
Contracts shall not at the time of delivery be prohibited under the laws of any jurisdiction in the
United States to which the institution is subject, and (ii) if the Securities are being sold to underwriters,
we shall have sold to those underwriters the total principal amount of the Securities less the principal
amount thereof covered by Contracts. Agents and underwriters wil have no responsibilty in respect of
the delivery or performance of Contracts.
11
In connection with a particular underwritten offering of Securities, the underwriters may engage in
transactions that stabilze, maintain or otherwise affect the prices of the classes or series of Securities
offered, including stabilizing transactions and syndicate covering transactions. A description of these
activities, if any, wil be set forth in the prospectus supplement relating to that offering.
Underwriters, dealers or agents and their associates may be customers of, engage in transactions
with or perform services for us and our affiliates in the ordinary course of business.
We wil indicate in a prospectus supplement the extent to which we anticipate that a secondary
market for the Securities wil 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 securities
exchange. If the Securities of any series are sold to or through underwriters, the underwriters may
make a market in such Securities, as permitted by applicable laws and regulations. No underwriter
would be obligated, however, to make a market in the Securities, and any market-making could be
discontinued at any time at the sole discretion of the underwriters. Accordingly, we cannot assure you
as to the liquidity of, or trading markets for, the Securities of any series.
Underwriters, dealers and agents participating in the distribution of the Securities may be deemed
to be "underwriters" within the meaning of, and any discounts and commissions received by them and
any profit realized by them on resale of those Securities may be deemed to be underwriting discounts
and commissions under, the Securities Act. Subject to some conditions, we may agree to indemnify the
several underwriters, dealers or agents and their controlling persons against specific civil liabilties,
including liabilities under the Securities Act, or to contribute to payments that person may be required
to make in respect thereof.
During such time as we may be engaged in a distribution of the securities covered by this
prospectus we are required to comply with Regulation M promulgated under the Exchange Act. With
certain exceptions, Regulation M precludes us, any affilated purchasers and any broker-dealer or other
person who participates in such distributing from bidding for or purchasing, or attempting to induce
any person to bid for or purchase, any security which is the subject of the distribution until the entire
distribution is complete. Regulation M also restricts bids or purchases made in order to stabilze the
price of a security in connection with the distribution of that security. All of the foregoing may affect
the marketability of our securities.
LEGAL MATTERS
The validity of the Securities 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 transition 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
SFAS No. 15S, Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans-an
amendment of FASB 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
12
accordance 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 lO-Q for the quarters ended March 31, 2007, June 30, 2007 and September 30, 2007 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 reports on such information should
be restricted in light of the limited nature of review procedures applied. Deloitte & Touche LLP is not
subject to the liability provisions of Section 11 of the Securities Act of 1933 for its reports on the
unaudited interim financial information because those reports are not "reports" 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 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.
13
PACIFICORP
$350,000,000
First Mortgage Bonds
5.50% Series Due 2019
$650,000,000
First Mortgage Bonds
6.00% Series Due 2039
UNERWRITING AGREEMENT
Execution Copy
Januar 5, 2009
BARCLAYS CAPITAL INC.
BANC OF AMERICA SECURES LLC
BNP P ARIBAS SECURTIES CORP.
GREENWICH CAPITAL MARETS, INC.
As Representatives (the "Representatives") of the several Underwite listed
In Schedule A hereto
clo BARCLAYS CAPITAL INC.
745 Seventh Avenue
New York, NY 10019
Dear Sirs:
1. Introductory. PacifiCoip, an Oregon coiporation (the "Company"), proposes, subject to
the term and conditions stated herein, to issue and sell to the several underwters listed in Schedule A
hereto (the "Underwriters") (i) U.S. $350,000,000 principal amount of its First Mortgage Bonds,
5.50% Series due 2019 (the "2019 Bonds") and (ii) U.S. $650,000,000 principal amount of its First
Mortgage Bonds, 6.00% Series due 2039 (the "2039 Bonds" and, together with the 2019 Bonds, the
"Offered Securities"), in each case to be issued under that cerin Mortgage Deed and Trust, dated as of
Januar 9, 1989, with The Ban of New York Mellon Trust Company, N.A., as successor trstee (the
"Trustee"), as heretofore amended and supplemented by the supplemental indentues thereto and as
furter amended and supplemented by a supplemental indenture to be dated Januar 1,2009 (collectively,
the "Mortgage") pursuant to the registrtion statement on Form S-3 (File No. 333-148662) fied 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
Indentue Act. The United States Securities Act of 1933, as amended, is herein referred to as the
. "Securities Act," and the rules and regulations of the Commission thereunder are herein referred to as the
"Rules and Regulations."
The Company hereby agrees with the several Underwiters as follows:
NY1468693.8
2. Representations and Warranties of the Company. The Company represents and warrnts
to, and agrees with, the several Underwiters that:
(a) The Initial Registration Statement in respect of the Offered Securities has ben
filed with the Commission; 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
Underwters and, excluding exhbits to the Initial Registrtion Statement but including all
documents incorporated by reference in the prospectu contained in such Initial Regstrtion
Statement, including any prospectus supplement relating to the Offered Securities that is filed
with the Commssion and deemed by virte of Rule 430B under the Securities Act to be part of
the Initial Registration Statement, became effective upon fiing with the Commission; other thana
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"),
filed 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 Registration Statement or any document.
incorporated by reference therein has heretofore been fied or transmitted for filing with the
Commission with respect to the offerig contemplated by the Initial Registrtion Statement (other
than documents fied after the fiing date of the Initial Registration Statement under the Securties
Exchange Act of 1934, as amended (the "Exchange Act"), and prospectuses filed 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 Registrtion
Statement, any post-effective amendment thereto or the Rule 462(b) Registrtion Statement, if
any, has been issued and no proceeding for that purose has been initiated or theatened by the
Commission.
(b) A prelimiar prospectus relating to the Offered Securities has been preared by
the Company and a final prospectus relating to the Offered Securities wil be prepared by the
Company in accordance with Section Sea) hereto. Such preliminar prospectus (includi the
documents incorporated by reference therein) is hereinafter refered to as, the "Preliminary
Prospectus"; such final prospectus relating to the Offered Securties to be fied with the
Commission pursuant to Rule 424(b) under the Securities Act (including the documents
incorporated by reference therein) is hereinafter referred to as the "Prospectus." The Preliminary
Prospectu, as amended or supplemented as of the Applicable Time (as defined below), when
considered together with the fmal term sheet filed pursuant to Section Sea) hereof, (th
"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. 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 necessary in order to make the
. statements therein, in the light of the circumstances under which they were made, not misleading;
and each Issuer Free Writig 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 Registrtion
Statement, the Preliminary Prospectus or the Prospectus and each such Issuer Free Writig
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 circumstaces
under which they were made, not misleading; provided, the preceding two sentences do not apply
to statements in or omissions from the Preliminar Prospectus, the Disclosure Package, the
Prospectus or any Issuer Free Writing Prospectus based upon written information furnished to the
Company by the Underwiters specifically for use therein, it being understood and agreed that the
only such information is that described as such in Section 7(b) hereof. For purposes of this
2
NY 1468693.8
Agreement, the "Applicable Time" is 2:30 p.m., New York City Time, on the date of thisAgreement. .
At the earliest time after the fiing of the Initial Registrtion Statement that the Company or another
offering partcipant 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 Registrtion 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 Registration Statement conforms, and any fu amendmnts or
supplements to the Registrtion 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 did not and will not contain an untre statement of a material fact
or omit to state a material fact requireç1 to be stated therein or necessary to make the statements
therein not misleading, and the Prospectus, as of its date and as amended or supplemented as of
the Closing Date, does not and will not contain an untre statement of a material fact or omit to
state a material fact required to be stated therein or necessar to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
(d) The Company has bèen duly incorporated and is validly existig 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 Prospectu 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 tranact
business and is in good standig in each jursdiction in which it own or leases substantial
propertes 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 subsidiares 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 instrment of the Company enforceable
against the Company in accordance with its terms, except as limited by banptcy, insolvency,
frudulent 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 descrption thereof in the Disclosure Package and the
Prospectus.
(f) The Offered Securities have been duly authorized by the Company and, when
authenticated and delivered in accordance with the Mortgage and paid for by the purchasers
thereof, will constitute valid and legally binding obligations of the Company enforceable against
the Company in accordance with their terms, except as limited by banptcy, insolvency,
fraudulent conveyance, reorganization and other similar laws relating to or affecting creditors'
rights generally and general equitable priciples (whether considered in a proceeding in equity or
at law), and will be entitled to the benefit of the securty afforded by the Mortgage; and the
Offered Securities conform to the description thereof in the Disclosure Package and the
Prospectus.
3
NY\146693.8
(g) No consent, approval, authorization or order of, or filing or registrtion by the
Company with, any cour, governental agency or third par is required for the consummation
of the transactions contemplated by this Agreement and the Mortgage in connection with the
issuance and sale of the Offered Securities by the Company and the use of the proceds of the
offering of the Offered Securities 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 deliverd 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 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 subject to any priciples of public policy limiting the right to enforce the
indemnification and contrbution provisions contained herein.
(i) Except as disclosed in the Disclosure Package and the Prspectus, the Company
has good and suffcient title to all the properties described as owneci and good and sufficient
leasehold interest in all of the properties described as leased by it (the "Properties"), subject to
minor defects and irregularities customaily 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.
(j) The Company is not (i) in violation of its Arcles of Incorporation (the
"Articles") or its Bylaws, as amended, (ii) in default in the performance or obserance of any
material obligation, covenant or condition contained in any contract, agreement or other
instrent to which it is a part or by which it may be bound or (ii) in violation of any order,
rule or regulation applicable to the Company of any court or any federal or state reguatory body
or admnistrative agency or other goverental body, the effect of which, in the case of (ii) and
(iii), would result in a Material Adverse Effect, and neither the execution and delivery of this
Agreement, the Mortgage, or the Offered Securities, 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 conflict with, or result in a breach of, or constitute a
default under (x) the Aricles or such Bylaws, or any material contract, agreement or other
instrment 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
administrative agency or other governmental body having jurisdiction 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 governental proceedings pending or to the Company's knowledge theatened against
the Company or its subsidiares that, if determined 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.
(I) The consolidated financial statements included or incorporated by reference in
the Disclosure Package and the Prospectus present fairly the fmancial condition and operations of
the Company and its consolidated subsidiaries 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 throughout the periods
4
NY1468693.8
involved except as otherwse indicated in the Disclosure Package and the Prospectus; and
PricewaterhouseCooper LLP, who examined certin audited financial statements of th
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
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 informtion 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 ordinar
course of business), or any material adverse change in the business, affairs, business prospects,
propert or financial condition of the Company and its subsidiaries taken as a whole, whether or
not arsing in the ordinar course of business, and since such dates there ha not been any
material tranaction entered into by the Company other than transactions contemplate by the
Disclosure Package and the Prospectus, and transactions in the ordinary coure of business; and
the Company has no material contingent obligation that is not disclosed in the Disclosure Package
and the Prospectus.
(n) The Company (i) maes 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 tht (1) trnsactions are executed in
accordance with management's general or specific authorization; (2) transactions are recorded as
necessary to permit preparation of financial statements in conformity 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 accordace with management's
general or specific authorization; and (4) the recorded accountability 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 officers 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,
warrnties and agreements herein contained, but subject to the terms and conditions herein set fort, the
Company agrees to sell to the Underwriters, and the Underwiters agree, severally and not jointly, to
purchase from the Company (i) at a purchase price of 98.695% of the principal amount thereof plus
accrued interest, if any, from Januar 8, 2009 to the Closing Date (as hereinafter defined), the respective
principal amounts of the 2019 Bonds set fort opposite the names of the several Underwters in
Schedule A hereto, and (ii) at a purchase price of 98.175% of the principal amount thereof plus accrued
interest, if any, from Januar 8, 2009 to the Closing Date, the respective principal amounts of the 2039
Bonds set fort opposite the names of the several Underwiters in Schedule A hereto.
The Company wil deliver against payment of the purchase price for each of the 2019 Bonds and
the 2039 Bonds to be purchased by each Underwiter hereunder and to be offered and sold by each
Underwriter in the form of one or more global securities in registered form without interest coupons (the
"Global Securities") deposited with the Trustee as custodian for The Depository Trust Company
5
NY14693.8
("DTC") and registered in the name of Cede & Co., as nominee for DTC. Interests in 'the Global
Securties wil be held only in book-entr form though DTC, except in the limited circumstances
described in the Disclosure Package and the Prospectus.
Payment for the 2019 Bonds and the 2039 Bonds shall be made by the Underwiters in Federl
(same day) funds by wire transfer to an account at a bank acceptable to the Underwters drwn to the
order of the Company at 10:00 A.M., (New York time), on January 8, 2009, or at such other time not later
than seven full business days thereafter as the Underwiters and the Company determine, such time being
herein referred to as the "Closing Date," against delivery to the Trustee as custodian for DTC of the
Global Securities. The Global Securities wil be made available for checking at the offce of Latham &
Watks LLP, 885 Third Avenue, New York, NY 10022, at least 24 hours prior to the Closing Date.
4. Representations by Underwriters; Resale by Underwriters. Each of the Underwters
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 Securities 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 anyting
done by it in relation to the Offered Securties in, from or otherwse 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 will not mae an offer of the
Offered Securities to the public in that Relevant Member State, other than: (i) to legal entities
which are authorized or regulated to operate in the financial markets or, if not so authorized or
regulated, whose corporate purpose is solely to invest in securties; (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 tuover 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
Securities shall require the Company or any UnderWiter to publish a prQspectus pursuant to
Aricle 3 of the Prospectus Directive. For the purposes 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 Securities to be offered so as to enable an investor to
decide to purchase or subscribe the Offered Securties, as the same may be vared in that Member
State by any measure implementing the Prospectus Directive in that Member State and the
expression Prospectus Directive means Directive 2003171/EC and includes any relevant
implementing measure in each Relevant Member State.
(c) (i) In Hong Kong, it has not offered or sold the Offered Securities 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 Securities and Futures Ordinance (Cap. 571, Laws of Hong
6
NY146893.8
Kong) and any rules made thereunder, or (ii) in other circumstaces 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 accesse 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 Securities which are or are intended to be
disposed of only to persons outside Hong Kong or only to "professional investors" with the
meaning of the Secruties and Futures 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 will 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 pursuant to Section 275(1 A), and
in accordance with the conditions, specified in Section 275 of the SF A or (ii) otherise pursuant
to, and in accordance with the conditions of, any other applicable provision of the SFA
(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 indiectly, in Japan or to a resident of Japan, except
pursuant to an exemption from the registrtion requirements of, and otherwse in compliance
with, the Securties and Exchange Law and any other applicable laws, regulations and ministerial
guidelines of Japan.
(e) Without the prior consent of the Company and the Representatives, other than
one or more ter sheets relating to the Offered Securties containing customary information, it
has not made and will not make any offer relating to the Offered Securities that would constitute
an issuer free writing prospectus or a free writing prospectus required to be fied with the
Commission; and any such free writing prospectus the use of which has been consented to by the
Company and the Representatives (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 Securities 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 filed or becomes effective or any amendment or
supplement to the Prospectus has been filed and to furnish you with copies thereof; to prepare a
final term sheet, containing solely a description of the Offered Securties, in a form approved by
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 Securities Act; to fie promptly all
7
NY\ 146693.8
report and any definitive proxy or information statements required to be filed by the Company
with the Commission pursuant to Section 13(a), 13(c), 14 or 15(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 173(a) under the Act) is required in connection with the
offering or sale of the Offered Securities; to advise you, promptly after it receives notice thof,
of the issuance by the Commission of any stop order or of any order preventig or suspending the
use of any Preliminary Prospectus or other prospectus in respect of the Offered Securties, of th
suspension of the qualification of the Offered Securties for offering or sale in any jursdiction, of
the initiation or theatening of any proceeding for any such puipose, or of any request by the
Commission for the amending or supplementing of the Registration Statement or the Prospectu
or for additional information; and, in the event of the issuance of any stop order or of any order
preventing or suspendíg the use of any Preliminar Prospectus or other prospectus or suspending
any such qualification, to promptly use its best effort to obtan the withdrawal 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 necessar to permit offers and sales of the Offered Securities by the
Underwiters (references herein to the Registration Statement shall include any such amendment
or new registration 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 refered to in
Rule 173(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 Securties and if at such time any event shall have occured 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 wer made when such Prospectus (or in lieu thereof, the
notice referred to in Rule 173(a) under the Securities Act) is delivered, not misleading, or, if for
any other reason it shall be necessary during such same period to amend or supplement the
Prospectus or to file under the Exchange Act any document incoiporated' by reference in the
Prospectus in order to comply with the Securities Act, the Exchange Act or the Trust Indenture
Act, to notify you and upon your request to fie such document and to prepare and fuish without
charge to each Underwriter and to any dealer in securties as many written 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 Underwter is required. under the Securities Act to deliver a prospectus (or in lieu thereof, the
notice referred to in Rule 173(a) under the Securties Act) in connection with sales of any of the
Offered Securities at any tie nine months or more after the time of issue of the Prospectus, upon
your request but at the expense of such Underwiter, to prepare and deliver to such Underwiter
as many written and electronic copies as you may request of an amended or supplemented
Prospectus complying with Section 1 O( a )(3) of the Securities Act. .
(c) To make generally available to its securityholders 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
(which need not be audited) complying with Section 11(a) of the Securities Act and the Rules and
Regulations thereunder (including, at the option of the Company, Rule 158);
8
NY\146893.8
(d) The Company wil arrge for the qualification of the Offered Securities for sale
and the determination of their eligibilty for investment under the laws of such jurisdictions in the
United States and Canada as the Underwriters designate and wil continue such qualifications in
effect so long as required for the resale of the Offered Securities by the Underwiters, provided
that the Company will not be required to qualify as a foreign corporation, to file 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 arsing out of the offerig of the
Offered Securities) or to taxation in respect of doing business in any jursdiction in which it is. not
otherwise subject.
(e) The Company wil pay all expenses incident to the performance of its obligations
under this Agreement and the Mortgage, for any filing fees and other expenses (including fees
and disbursements of counsel) incurred in connection with qualification of the Offered Securities
for sale and determination of their eligibility for investment under the laws of such jursdictions
as the Underwrters designate and the printing of memoranda relatig 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 Securtis, the
preparation and printing of ths 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 Securties,
for the cost of any advertsing approved by the Company in connection with the issue of the
Offered Securities, for any fees charged by investment rating agencies for the rating of the
Offered Securities, for any travel expenses of the Company's officers and employees, and any
other expenses of the Company in connection with attending or hosting meetings with
prospective purchasers of the Offered Securties and for expenses incured in distrbuting the
Disclosure Package, the Prospectus or any Issuer Free Writing Prospectus (including any
amendments and supplements thereto) to the Underwiters. Except as otherwse provided in th
Section 5(e) or in Section 9 of this Agreement, the Underwters will 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 incurred by them.
(1) In connection with the offering, until the earlier of (i) 180 days following the
Closing Date and (ii) the date the. Underwters shall have notified the Company of the
completion of the resale of the Offerd 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 affiiates has a beneficial interest any Offered Securities or attempt to induce
any person to purchase any Offered Securities; and neither it nor any of its affiliates wil make
bids or purchases for the purpose of creating actual, or apparent, active trading in, or of raising
the price of, the Offered Securities.
(g) From the date hereof though and including the Closing Date, the Company wil
not, without the prior written consent of the Representatives, offer, sell, contrct to sell, pledge or
otherwise dispose of, directly or indirectly, or file 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 maturity of more than one year from the date of
issue.
(h) If the Company elects to rely upon Rule 462(b), the Company shall fie 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 shaif-at the
time of fiing either pay to the Commssion the filing fee for the Rule 462(b) Registration
9
Ny\ 1468693.8
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 thn the final term sheet
prepared and filed pursuant to Section 5(a) hereof, without the prior consent of the
Representatives, it ha not made and wil not make any offer relatig to the Offered Securities
that would constitute a "fre writing 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, includig timely filing with the Commission or retention where
required and legending.
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 accuacy of the
representations and waranties on the part of the Company herein, to the accurcy of the statements of
officers of the Company made pursuant to the provisions hereof, to the performance 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
Securities shall have been fied with the Commission pursuant to Rule 424(b) within the
applicable tie period prescribed for such fiing (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
theatened by the Commission; and all requests for additional information on the par of the
Commission shall have been complied with.
(b) (i) On the date herf, PrcewaterhouseCoopers LLP shall have fuished to the
Underwters a letter, dated as of the date hereof, in form and substatice satisfactory to the
Underwiters, confirming that as of May 26, 2006 and during the period covered by the fiancial
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 Securities 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 parcular 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 fmancial 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
derived from such dollar amounts) and other financial information contained in
the Preliminar 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
10
Ny\146893.8
such letter and have found such dollar amounts, percentages and oth 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 Xi) of ths Section,
except that (A) the specified date referred to in such subsection will be a date not more than thee
business days prior to the Closing Date for the purposes of ths subsection, and (B) references to
the Preliminary Prospectus will be replaced with references to the Prospectus.
(c) (i) On the date hereof, Deloitte & Touche LLP shall have fuished to the
Underwters 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 Securities 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 fmancial information is given in the Preliminar Prospectu
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 of the Securities
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
responsibilty for financial and accounting matters and other specified
procedures, nothing came to their attention that caused them to believe that:
(1) at the date of the latest available balance sheet read by such
accountats, or at a subsequent specified date not more than one business
day prior to the date of this Agreement, there was any chage 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 current
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;
(3) at January 2, 2009, 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 .
11
NY\ 1468693.8
(4) for the period from December 1, 2008 to Januar 2, 2009,
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) an other financial informtion contained in
the Preliminar Prospectus (in each case to the extent tht such dollar amounts,
percentages and othr financial information are derived from the gener
accounting records of the Company and its subsidiaries subjet to the internal
çontrols 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
informtion to be in agreement with such results, except as otherwse specified in
such letter.
(ii) The Underiters shall have received a letter, dated the Closing Date, of
Deloitte & Touche LLP which meets the requirements of subsection (c)(i) of ths Section, except
that (A) the specified date referred to in such subsection wil be a date not more than one business
day prior to the Closing Date for the puroses of this subsection, and (B) references to the
Preliminary Prospectus will be replaced with references to the Prospectus.
(d) Subsequent to the Applicable Time, there shall not l1ave been (i) any change, or
any development or event involving a prospective change, in the financial condition, business,
propertes or results of operations of the Company and its subsidiares taen as a whole, which, in
the judgment of the Representatives, is material and adverse and makes it impractical or
inadvisable to proceed with completion of the offering or the sale of and payment for th Offered
Securities; (ii) any downgrading in the rating of any debt securties or prefered stock of the
Company by any "nationally recognized statistical rating organization" (as defined for puroses
of Rule 436(g) under the Securities Act), or any public announcement that any such organization
has under surveilance or review its rating of any debt securties or preferred stock of the
Company (other than an anouncement with positive implications of a possible upgrading, and no
implication of a possible downgrading, of such rating); (iii) any material suspension or materal
limitation of trding in securities generally on the New York Stock Exchange, or any settng of
minimum prices for trding on such exchange; (iv) any suspension of trading of any securities of
the Company on any exchange or in the over-the-counter market; (v) any bankng moratorium
declared by U.S. Federal or New York authorities; (vi) any material disruption in settlements of
securities or clearce services in the United States; or (vii) any attck on, or outbreak or
escalation of hostilities or act of terrorism involving, the United States, any declartion of war by
Congress or any other substantial national or international calamty or emergency if, in the
judgment of the Representatives, the effect of any such attck, 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 Securities.
(e) The Underwters shall have. received an opinion, dated the Closing Date, of
Mark C. Moench, General Counsel of the Company, substatially in the form of Exhibit A hereto.
(f) The Underwters 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 Underwiters, such opinion or opinions, dated the Closing Date, in form and substance
satisfactory to the Underwiters, and the Company shall have furnished to such counsel such
documents as they request for the purpose of enabling them to pass upon such matters. In
12
NY 1468693.8
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 Perkins Coie LLP referred to
above.
(h) The Underwiters shall have received a certficate, dated the Closing Date, of the
President or any Vice President and a principal financial or accounting offcer of the Company in
which such offcers, to the best of their knowledge after reasonable investigation, shall state that:
(i) the representations and warranties of the Company in ths Agreement are tre and correct, or
tre and correct in all material respects where such representations and warrntis are not
qualified by materiality or Material Adverse Effect; (ii) that the Company has complied with all
agreements and satisfied all conditions on its part to be performed 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
subsidiaries taen as a whole except as set fort in the Disclosure Package and the Prospctus or
as described in such certficate.
The Company wil (i) furnish the Underwiters with such conformed copies of such opinions,
certficates, letters and documents as the Underwters reasonably request. The Underwiters may waive
compliance with any conditions to their obligations hereunder.
7. Indemnifcation and Contribution. (a) The Company wil indemnify and hold harmess
each Underwiter, its parters, 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, dages
or liabilties, joint or several, to which such Underwiter may become subject, under the Securties Act or
the Exchange Act or otherwse, insofar as such losses, claims, damages or liabilties (or actions in respect
thereof) arse out of or are based upon any untre 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 Registration
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, daages or liabilities arsing out of or based upon the Company's failur to pedorm its
obligations under Section 5(a) of ths Agreement, and will reimburse each Underwter for any legal or
other expenses reasonably incurred by such Underwiter in connection with investigating or defending
any such loss, claim, damage, liabilty or action as such expenses are incurd; provided, however, that
the Company will not be liable in any such case to the extent that any such loss, claim, damage or liabilty
arises out of or is based upon an untre statement or alleged untre statement in or omission or alleged
omission from any of such documents in reliance upon and in conformity with written information
furnished 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 Preliminary Prospectus shall not inure to the benefit of any Underwiter from whom the person
asserting any such losses, claims, damages or liabilities (or actions in respect thereof), in connection with
clauses (i) though (iii) below, purchased Offered Securities, or any person èontrolling such Underter,
where it shall have been determined by a court of competent jurisdiction by final and non-appealable
judgment that (i) prior to the Applicable Time the Company has notified such Underwriter that the
Preliminary Prospectus, dated January 5, 2009, contains an untre statement of material fact or omits to
state therein a material fact necessar in order to make the statements therein, in the light of the
13
NY\ 1468693.8
circumstaces under which they were made, not misleading, (ii) such untre statement or omission of a
material fact was corrected in an amended or supplemented Prelimirary Prospectus and such corrected
Preliminar Prospectus was provided to such Underwiter 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 Underwiter will severally and not jointly indemnify and hold haless the
Company, its directors and officers and each person, if any, who controls the Company within the
meaning of Section i 5 of the Securities Act, against any losses, claims, damages or liabilties to which the
Company may become subject, under the Securities Act or the Exchange Act or otherwse, insofar as such
losses, claims, damages or liabilties (or actions in respect thereof) arise out of or are based upon any
untre statement or alleged untre statement of any material fact contained in the Registration Statement,
the Prelimnary 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 arse 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 circumstaces
under which they were made (in the case of the Registrtion Statement, necessar in order to make the
statements therein not misleading), not misleading, in each case to the extent, but only to the extent, that
such untre statement or alleged untre 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 will reimburse any legal or other expenses
reasonably incured by the Company in connection with investigatig or defending any such loss, claim,
damge, liability or action as such expenses are incured, it being understood and agreed that the only
such information furnished by any Underwter consists of the following information in the Preliminar
Prospectus and Prospectus furnished on behalf of each Underwter: under the caption "Underwting,"
paragraphs 3, 4 (second sentence only) 5 and 6; provided, however, tht the Underwter shall not be
liable for any losses, Claims, damges or liabilities arsing out of or based upon the Company's failure to
perform its obligations under Section 5(a) of this Agreement.
(c) Promptly after receipt by an indemnified par under this Section of notice of th
commencement of any action, such indemnified par wil, if a claim in respect thereof is to be made
against the indemnifying par under subsection (a) or (b) above, notify the indemnifying par of the
commencement thereof; but the omission so to notify the indemnifying par 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 (through forfeiture or impairment of procedural or substative rights
or defenses) by such failure; and provided further that the failure to notify the indemnifying part shall
not relieve it from any liability that it may have to an indemnified par otherwse than under subsection
(a) or (b) above. In case any such action is brought against any indemnified par and it notifies the
indemnifying part of the commencement thereof, the indemnifying par wil be entitled to paricipate
therein and, to the extent that it may wish, jointly with any other indemnifying par 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 par 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 incurred 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 nght
to employ counsel to represent the indemnified part and their respective controlling persons who may be
subject to liabilty arising out of any claim in respect of which indemnity may be sought by the
indemnified part against the indemnifying par 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
14
NY\146693.8
action, if in the wrtten opinion of counsel to either the indemnifying part or the indemnified par,
representation of both paries by the same counsel would be inappropriate due to actual or likely conflicts
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 par. No indemnifying par shal, without the prior written consent of the indemnified
part (which consent shall not be unreasonably witheld), effect any settement of any pending or
theatened action in respect of which any indemnified par is or could have been a par and indemnity
could have been sought hereunder by such indemnified par unless such settement (i) includes an
unconditional release of such indemnified par from all liabilty on any claims tht are the subject matter
of such action and (ii) does not include a statement as to or an admssion of fault, culpabilty or failure to act
by or on behalf of any indemnified part.
(d) If the indemnification provided for in this Section is unavailable or insuffcient to
hold harless an inderIified part under subsection (a) or (b) above, then each indemnifying part shall
contrbute to the amount paid or payable by such indemnified pary as a result of the losses, claims,
damages or liabilities referred to in subsection (a) or (b) above (i) in such proporton 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 2019 Bonds or the 2039 Bonds, as applicable, or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proporton 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 omisions which resulted in
such losses, claims, damages or . liabilties as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and the Underters on the other shall be
deemed to be in the same proportion as the total net proceeds (before deductig expenses) from the
offering of the 2019 Bonds or the 2039 Bonds, as applicable, received by the Company bear to the total
discounts and commissions received by the Underwiters with respect to the 2019 Bonds or the 2039
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 untre 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 pares' relative intent, knowledge, access to information and opportity to
correct or prevent such untre statement or omission. The amount paid by an indemnified par as a result
of the losses, claims, daages or liabilities referred to in the first sentence of this subsection (d) shall be
deemed to include any legal or other expenses reasonably incurred by such indemnified part in
connection with investigating or defending any action or claim which is the subject of this subsection (d).
Notwithstanding the provisions of ths subsection (d), no Underwiter shall be required to contrbute any
amount in excess of the amount by which the total price at which the 2019 Bonds or the 2039 Bonds, as
applicable, purchased by it were resold. exceeds the amount of any damages which such Underwiter 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(t)
of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwters' obligations in this subsection (d) to contrbute 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 Underwter within the meaning of the Securities Act or the
Exchange Act; and the obligations of the Underwiters under this Section shall be in addition. to any
liability which the respective Underwiters may otherwse have and shall extend, upon the same terms and
conditions, to each person, if any, who controls the Company within the meaning of the Securities Act or
the Exchange Act.
15
NY\1468693.8
8. Default of Underwriters. If any Underwiter or Underwters defaults in its or their
obligations to purchase the 2019 Bonds or the 2039 Bonds, as applicable, hereunder and the aggregate
pricipal amount of the 2019 Bonds or the 2039 Bonds, as applicable, that such defaulting Underwiter or
Underwriters agreed but failed to purchase does not exceed 10% of the total principal amount of the 2019
Bonds or the 2039 Bonds, as applicable, the non-defaulting Underwiters may make arrangements
satisfactory to the Company for the purchase of such 2019 Bonds or 2039 Bonds by other persons,
including themselves, but if no such arrangements are made by the Closing Date, the non-defaulting
Underwiters shall be obligated severally, in proporton to their respective commitments hereunder, to
purchase the Offered Securties that such defaulting Underwiter or Underwiters agreed but failed to
purchase. If any Underwiter or Underwiters so defaults and the aggregate pricipal amount of the 2019
Bonds or the 2039 Bonds, as applicable, with respect to which such default or defaults occur exceed 10%
of the total principal amount of the 2019 Bonds or the 2039 Bonds, as applicable, and arrngements
satisfactory to the non-defaulting Underiters and the Company for the purchas of such 2019 Bonds or
2039 Bonds by other persons are not made within 36 hours after such default, this Agreement will
terminate without liabilty on the par of the non-defaulting Underwiters or the Company, except as
provided in Section 9. As used in this Agreement, the ter "Underwitet' includes any person substituted
for a Underwter under this Section. Nothing herein, including the Company's obligations pursuant to
Section 9 hereof, will relieve a defaulting Underwiter from liabilty 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 Underwriters set fort in or made pursuant to this Agreement will remain in full force and effect,
regardless of any investigation, or statement as to the results thereof, made by or on behalf of any
Underwiter, the Company or any.., of their respective representatives, officers or directors or any
controllng peron, and will surive delivery of and payment for the Offered Securties. If this Agreement
is terminated puruant to Section 8 or if for any reason the purchase of the Offered Securities by the
Underwters 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 Underwiters pursuant to Section 7 shall remain in effect. If the
purchase of the Offered Securities by the Underwiters is not consumated 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 (ii), (v), (vi) or (vii) of Section 6(d), the Company will 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 Underwters 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,
notwthstanding any preexisting relationship, advisory or otherwise, between the paries or any oral
representations or assurances previously or subsequently made by the Underwiters: (i) no fiduciary or
agency relationship between the Company and any other person, on the one hand, and the Underwters,
on the other, exists in connection with the offering of the Offered Securities; (ii) the Underwters are not
acting as advisors, expert or otherwise, to the Company in connection with the offering of the Offered
Securities and such relationship between the Company, on the one hand, and the Underwriters, on the
other, is entirely and solely commercial, based on arms-length negotiations; (iii) any duties and
obligations that the Underwiters may have to the Company in connection with the offering of the Offered
Securities shall be limited to those duties and obligations specifically stated herein; and (iv) the
Underwiters and their respective affiiates 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 transactions wil be performed solely for the benefit of the Underwiters and not on behalf
16
NY 1468693.8
of the Company. The Company hereby waives any claims that the Company may have against the
Underwiters with respect to any breach of fiduciar duty in connection with ths offering.
11. Notices. All communications hereunder will be in wrting and, if sent to the
Underwiters, will be mailed, delivered or faxed and confirmed to each of (i) Barclays Capital Inc., 200
Park Avenue, New York, NY 10166; Facsimile number: 212-412-7305, Attention: Investment Grade
Syndicate, (ii) Banc of America Securities LLC, NYI-I00-18-03, One Bryant Park, New York, NY
10036, Facsimile number: 646-855-5958, Attention: High Grade Transaction Management/egal, (iii)
BNP Paribas Securties Corp., 787 Seventh Avenue, New York, NY 10019, Facsimile number 212-841-
3930, Attention: Syndicate Desk, and (iv) Greenwich Capital Markets, Inc., 600 Steamboat Road,
Greenwich, CT 06830, Facsimile number 203-873-4534, Attention: Debt Capital Markets Syndicate, or,
if sent to the Company, will be mailed, delivered or telegraphed and confirmed to it at PacifiCorp, 825
NE Multnomah, 18th Floor, Portland, OR 97232, Attention: Legal Departent; provided, however, that
any notice to a partcular Underwiter pursuant to Section 7 wil be mailed, delivered or faxed and
confirmed to such Underwter.
12. Successors. This Agreement will inure to the benefit of and be binding upon the pares
hereto and their respective successors and the controlling 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 counterpar, each of
which shall be deemed to be an original, but all such counterpar shall together constitute one and the
same Agreement.
14. Applicable Ltlw. This Agreement shall be governed by, and construed in accordance
with, the laws of the State of New York without regard to principles of conflcts oflaws.
The Company hereby submits to the exclusive jurisdiction of the Federal and state courts in the
Borough of Manatt in The City of New York in any suit or proceeding arsing out of or relating to ths
Agreement or the transactions contemplated hereby.
(Signatures follow J
17
NY\ 146693.8
If the foregoing is in accordance with the Underwriters' understanding of our agreement, kindly
sign and retu to us one of the counterpar hereof, whereupon it wil become a binding agreement
between the Company and the severa Underwters in accordance with its terms.
Very trly your,
PacifiCorpBy: .~,J L~
Name:
Title:
The foregoing Underwiting Agreement
is hereby confirmed and accepted
as of the date first above wrtten.
BARCLA YS CAlIT AL INC.
By:
Name:
Title:
BANC OF AMERICA SECURITIES LLC
By:
Name:
Title:
BNP PARIAS SECURIES CORP.
By:
Name:
Title:
GREENWICH CAPITAL MARKS, INC.
By:
Name:
Title:
On behalf of themselves and as Representatives of the several Underwters
(Underwriting Agreement)
ff"thi .fotëgøing is in aecør~.e with th Uiid.~t~'.lldersÙ'g..øt bur agr, ldndiy
sign .and. ret to us øneof tle eoi;ntcriis hereof" whéreupon . it wiii bêöme a bíi1jDg iig~en
betwe~, theCottany aüdtbese:Vèrf LJ tiderntêrsitil~t-dèewith. itsoter,
Vér .trly, yoUis~
Pl:øOôrp
.Iy;.
Nliø:
Titlë:
The f()reg9ingU~~g~eeer1
i$ hereby 'cøfiitedand ;àëceed
as òfthcfdalè flisi abøvë Wntten..
BARCLAYSOAPITAL.1NC.
ii 1J ;f
Name¡¡,L~-+ $-1-.
Title: 11..-~ ~., ø. £.,11-
BA'NC OF AMERICA SECUnlE I,Jt:
By:
Name:
Titd:
BNP i'AlAS SECUlUTIES CORP.
BY.:
Name:
Title:
GREENCflCAPITALMARSi iNC.
By:
Name:
Tite:
OrtbelôftleniSeM:sand ás Rëprcsclltáiives. of the seveml Unöetei:
(Wider!nting Agreement)
,
BO Fax [phone] Jan 5 2009 09:54am P01/001
. .
If the foregoing is in acrdance wit the Under' undeidig of ou ageement, kindly
sign and re to us one of the counerpar berf; whereupon it wil beome a bindig agrement
between the Compa and 1be seer Underters in acco with its tes.
The foregoing Underti Agrement
is hereby confed and accept
as of the da fir above wrtt.
BAR CLAYS CAITAL lNC.
"
By:
Name;
Title:
B
By:
Name: Peer boe
Tiie: Vice President
BNP PARAS SECU CORP.
By:
Name;
Titl:
GREENWCH CAAL MATS, INC.
By:
Name:
Title:
Ver try you,
PacCö
By;
Name:
Tite:
On behal of themselves and as Representatives of the st'\eral Underw
(Underwti Agrt)
If the foregoing is in accance wit th Underter' underdin of our agreement, kily
sign and retu to us one of the countear heref. wherupon it wil becme 8 bining agrent
between th Company and the several Underters in accrdan with its terms.
Ver trly your,
PaciCor
By:
Name:
Tite:
The foregoing Undertig Agrement
is herby confnned and acceed
as of the date first above wnttn.
BARCL YS CAPITAL INC.
By:
Name:
Title:
BANC OF AMCA SECURITIS LL
By:
Name:
Title:I
I"
MAAGING DIRECTOR
lM Of DE C~PITAl MATS
GREWICH CAPITAL MAS. INC.
By:
Name:
Title:
On behalf of themselves and as Representatives of the several Undeters
(Underwtig Agreemet)
If the foregoing is .in acordance with the Underwiters' undersanding of our agment, kindly
sign and return to us one of the counterpar hereof, whereupon it wil beome a binding agreement
between the Company and the several Underwriters in accordance with its tenns.
Very try yours,
PaciCorp
By:
Name:
Title:
The foregoing Underwiting Agrement
is hereby confinned and accepted
as of the date first above written.
BARClA YS CAPITAL INC.
By:
Name:
Title:
BANC OF AMERICA SECURITIES lLC
.By:
Name:
Title:
BNP PARIBAS SECURITIES CORj.
By:
Name:
Title:
GREENWICH CAPITAL MARKETS, INC.~N~e:~ . Fren
Title: Vice President
On behalf ofthemselves and as Representatives of the several Underwiters
(Underwriting Agreemet)
SCHEDULE A
Underwriter
BARCLAYS CAPITAL INC.
BANC OF AMERICA SECURITIES LLC
BNP PARIBAS SECURTIE~ CORP.
GREENWICH CAPITAL MAETS, INC.
WEDBUSH MORGAN SECURITIES INC.
WELLS FARGO SECURITIES, LLC
CREDIT SUISSE SECURTIES (USA) LLC
SCOTIA CAPITAL (USA) INC.
SUNRUST ROBINSON HUMPHRY, INC.
U.S. BANCORP INVESTMENTS, INC.
Total......................................................................
NY\1468693.8
Principal
Amount of
2019 Bonds
$63,000,000
$63,000,000
$63,000,000
$63,000,000
$28,000,000
$28,000,000
$10,500,000
$10,500,000
$10,500,000
$10,500,000
$350,000,000
Principal
Amount of
2039 Bonds
$117,000,000
$117,000,000
$117,000,000
$117,000,000
$52,000,000
$52,000,000
$19,500,000
$19,500,000
$19,500,000
$19,500,000
$650,QOO,000
SCHEDULE B(i)
Issuer Free Writing Prospectuses
See Schedule B(ii)
NY\ 146893.8
Issuer:
Ratings*:
Security Type:
Legal Formt:
Principal Amount:
Coupon:
Interest Payment Dates:
Trade Date:
Settlement Date:
Maturity:
Treasury Benchmark:
US Treasur Spot:
US Treasury Yield:
NY\1468693.8
SCHEDULE B(ii)
FINAL TERM SHEET
PacifiCorp
Filed pursuant to Rule 433(d)
Registration No. 333-148662
Dated January 5, 2009-
2019 Bonds: A31 A-I A- (stable I watch negative I stable)
2039 Bonds: A31 A-I A- (stable I watch negative I stable)
First Mortgage Bonds due 2019
First Mortgage Bonds due 2039
SEC Registered
2019 Bonds: $350,000,000
2039 Bonds: $650,000,000
2019 Bonds: 5.50%
2039 Bonds: 6.00%
Semi-annually on January 15 and July 15, commencing on July 15, 2009.
Januar 5, 2009
January 8, 2009 (T+3)
2019 Bonds: Janua 15,2019
2039 Bonds: January 15,2039
2019 Bonds: 3.75%, November 15,2018
2039 Bonds: 4.375%, Februry 15,2038
2019 Bonds: 110-31+
2039 Bonds: 127-08+
2019 Bonds: 2.486%
2039 Bonds: 2.969%
Spread to Treasur: 2019 Bonds: +310 basis points
2039 Bonds: +310 basis points
Re-offer Yield: 2019 Bonds: 5.586%
2039 Bonds: 6.069%
Price to Public (Issue Price): 2019 Bonds: 99.345% of principal amount
2039 Bonds: 99.050% of principal amount
Optional Redemption: 2019 Bonds: Make-Whole Call at T+50 basis points
2039 Bonds: Make-Whole Call at T+50 basis points
Denomiations: $2,000 and any integral multiples of $1 ,000 in excess thereof
Joint Bookrnners: Barclays Capital Inc.
Banc of America Securities LLC
BNP Paribas Securities Corp.
Greenwich Capital Markets, Inc.
Co-Managers: Wedbush Morgan Securities Inc.
Wells Fargo Securities, LLC
Credit Suisse Securities (USA) LLC
Scotia Gapital (USA) Inc.
SunTrut Robinson Humphrey, Inc.
U.S. Bancorp Investments, Inc.
CUSIP / ISIN: 2019 Bonds: 695114 CK2 / US695114CK20
2039 Bonds: 695114 CLO / US695114CL03
* Note: A securties 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 fied a registration statement (includig 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 www.sec.gov. Alternatively, the issuer, any
underwiter or any dealer participating in the offerig wil arge to send you the prospectus if you
request it by callng Barclays Capital Inc. at 1-888-227-2275, ext. 2663, Banc of America Securities LLC
at 1-800-294-1322, BNP Paribas Securities Corp. at 1-800-854-5674 or Greenwich Capital Markets, Inc.
at 1-866-884-2071.
NY\1468693.8
. EXHIBIT A
Form of Opinion of Mark C. Moench, General Counsel of the Còmpany
1. To my knowledge and excet for the mattrs disclosed in the Disclosure Package, there is no
legal or governmental 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 subsidiares, taken as a
whole, is reasonably likely to have, individually or in the aggregatè\ a material adverse effect on the
business, affairs, propert or financial condition of the Company and its subsidiaries taen as a whole or a
material adverse effect on the abilty of the Company to pedorm its obligations under the Underwiting
Agreement, the Mortgage or the Bonds. J
2. The execution, delivery and performance of the Underwiting 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 will 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 puruant to the ters of, or constitute a breach
of, or default under, any agreement, indenture or other instrment to which the Company is a part, 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 propertes,
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 subsidiares taken as a whole.
3. To my knowledge, except for such consents, approvals, authorizations, registrations or
qualifications as may be required under the Securities Act, the Trust Indentue Act or state securties or
blue sky laws or as may be required by applicable state public utility commissions and under the Federal
Power Act, no consent, authorization or order of, or fiing or registration by the Company with, any court,
governmental agency or third part is required in connection with the execution, delivery and
performance by the Company of the Underwiting Agreement and the Mortgage, the consummation of the
transactions 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 filing, 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 irregularties
customarily 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 ths paragraph 4.
NY146893.8
EXIDBITB
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, attched 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 standing in
each jursdiction where the ownership or leasing of its propertes 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 aggegate, have a Material Adverse Effect.
3. The Company has all requisite corporate power and authority to enter into the Underting
Agreement and the Supplemental Indenture, to issue the Bonds and to consumate the transactions
contemplated by the Underwriting Agreement.
4. Each of the Underwting 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 agait
the Company in accordance with its ters.
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 Underting Agreement and the Mortgage, have been
duly executed and, when authenticated by the Trustee in the manner 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 "Descrption
of Additional Bonds" insofar as they purort to sumarize the provisions of the Mortgage and the Bonds,
fairly summarize such provisions in all materal respects.
9. No approval, ~uthorization, 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 Underwiting Agreement, the due
authorization, execution or delivery of the Underwiting Agreement or the due execution, delivery or
performance 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 fiing, could reasonably be expected to have a
Material Adverse Effect and except (a) the registration of the Bonds with the Commission under the
Securities Act pursuant to the Registration Statement and (b) such as have been obtained or made.
10. The Idaho Public Utilities Commission 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 Utilities and Transportation Commission regarding the issuance and sale of the Bonds
NY 1468693.8
that complies with the filing requirements ofRCW 80.08.040 and WAC 480-100-242; the Company has
fied a notice of proposed securities issuance with the Idaho Public Utilities Commission 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 term of the Underwiting Agreement.
11. The Registration Statement was declared immediately effective under the Securities Act on
Janua 9, 2008; the Prospectus was fied with the Commission pursuant to Rule 424(b) on January ( ),
2009 in a maner and within the time period required by Rule 424(b) under the Securities A(:t; 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 Securities Act
and, to our knowledge, no proceedings for that purose have been initiated by the Commission.
12. The Registrtion Statement, as of its effective date, and the Preliminar Prospectu, as of its date,
including in each case the information deemed to be a par 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 Securities 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 il, or omitted from, the Registration Statements, the Preliminar
Prospectus or the Prospectus or Regulation S- T.
Ny\ 1468693.8
REPORT OF SECURITIES ISSUED
January 14,2009
PACIFICORP
Description of securities:$350,000,000 ofPacifiCorp's First Mortgage Bonds
5.50% Series due January 15,2019
$650,000,000 ofPacifiCorp's First Mortgage Bonds
6.00% Series due January 15,2039
Description Amount
1.Face value or principal amount $1,000,000,000
2.Plus premìum or less discount (8,467,500)
3.Gross proceeds 991,532,500
4.Underwiter's spread or commissìon (7,962,500)
5.Securities and Exchange Commission registration fee (39,300)
6.State mortgage registration tax N/A
7.State commission fee*(2,000)
8.Fee fOf'recording indenture*(35,000)
9.United States document ta N/A
10.Printìng and engraving expenses*(20,000)
11.Trustee's charges*(20,000)
12.Counsel fees*(120,000)
13.Accountants' fees*(115,000)
14.Cost of listing N/A
15.Mìscellaneous expenses of issue* *(298,700)
(Describe large items)
16.Total deductìons (650,000)
17.Net amount realized $982,920,000
*Denotes estimate only.
** Includes estimated rating agency fees of $250,000 for the Bonds.