-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, FJ23kmV89WI944bQHHhvS0e2FIPUlVv10GVlKHFhbvQZyXpL98fP+M0gN7QAVNfQ /qgVh1nnE2vb3XufNbvE+w== 0000075594-94-000011.txt : 19941017 0000075594-94-000011.hdr.sgml : 19941017 ACCESSION NUMBER: 0000075594-94-000011 CONFORMED SUBMISSION TYPE: S-3/A PUBLIC DOCUMENT COUNT: 8 FILED AS OF DATE: 19941014 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: PACIFICORP /OR/ CENTRAL INDEX KEY: 0000075594 STANDARD INDUSTRIAL CLASSIFICATION: 4931 IRS NUMBER: 930246090 STATE OF INCORPORATION: OR FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3/A SEC ACT: 1933 Act SEC FILE NUMBER: 033-55309 FILM NUMBER: 94552615 BUSINESS ADDRESS: STREET 1: 700 NE MULTNOMAH STE 1600 CITY: PORTLAND STATE: OR ZIP: 97232 BUSINESS PHONE: 5037312000 FORMER COMPANY: FORMER CONFORMED NAME: PACIFICORP /ME/ DATE OF NAME CHANGE: 19890628 FORMER COMPANY: FORMER CONFORMED NAME: PC/UP&L MERGING CORP DATE OF NAME CHANGE: 19890628 S-3/A 1 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 13, 1994 Registration No. 33-55309 =========================================================================== SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ___________________________ AMENDMENT NO. 1 TO FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ___________________________ PACIFICORP DELAWARE, L.P. PACIFICORP (EXACT NAME OF REGISTRANT (EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER) AS SPECIFIED IN CHARTER) DELAWARE OREGON (STATE OR OTHER JURISDICTION OF (STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION) INCORPORATION OR ORGANIZATION) 93-1151704 93-0246090 (I.R.S. EMPLOYER IDENTIFICATION NO.) (I.R.S. EMPLOYER IDENTIFICATION NO.) RICHARD T. O'BRIEN RICHARD T. O'BRIEN VICE PRESIDENT VICE PRESIDENT PACIFICORP PACIFICORP 700 NE MULTNOMAH, SUITE 1600 700 NE MULTNOMAH, SUITE 1600 PORTLAND, OREGON 97232 PORTLAND, OREGON 97232 503-731-2000 503-731-2000 (ADDRESS, INCLUDING ZIP CODE, (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF REGISTRANT'S AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES PRINCIPAL EXECUTIVE OFFICES AND AGENT FOR SERVICE) AND AGENT FOR SERVICE) ___________________________ It is respectfully requested that the Commission send copies of all notices, orders and communications to: STOEL RIVES BOLEY WINTHROP, STIMSON, PUTNAM JONES & GREY & ROBERTS 700 NE MULTNOMAH, SUITE 950 ONE BATTERY PARK PLAZA PORTLAND, OREGON 97232-4109 NEW YORK, NEW YORK 10004-1490 ATTENTION OF JOHN M. SCHWEITZER ATTENTION OF C. PAYSON COLEMAN, JR. (503) 872-4821 (212) 858-1426 ___________________________ APPROXIMATE DATE OF PROPOSED SALE TO THE PUBLIC: From time to time after the effective date of the Registration Statement. If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. /_/ If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. /x/ ___________________________ CALCULATION OF REGISTRATION FEE ===========================================================================
Proposed Proposed Title of each Amount Maximum Maximum Amount of Class of Securities to be Offering Price Aggregate Registration Being Registered Registered(1) Per Unit(1)(2)(3) Offering Price(1)(2)(3) Fee(4) _________________________________________________________________________________________________________________ PacifiCorp Delaware, L.P. Preferred Securities . . _________________________________________________________________________________________________________________ PacifiCorp Junior Subordinated Debentures . . . _________________________________________________________________________________________________________________ PacifiCorp Guarantee with respect to PacifiCorp Delaware, L.P. Preferred Securities(5) . . . . . . . . _________________________________________________________________________________________________________________ Total . . . . . . . . . . $150,000,000 100% $150,000,000 $51,723 ================================================================================================================= (1) There are being registered hereunder Preferred Securities of PacifiCorp Delaware, L.P., and Junior Subordinated Debentures of PacifiCorp (which may be distributed to holders of such Preferred Securities upon a dissolution of PacifiCorp Delaware, L.P., for which no separate consideration will be received, or separately issued to the public or institutional investors) with an aggregate initial offering price not to exceed $150,000,000. The amount to be registered, the proposed maximum offering price per unit and the proposed maximum aggregate offering price for each class of securities being registered hereunder have been omitted in accordance with General Instruction II.D. of Form S-3. (2) Estimated solely for the purpose of determining the registration fee. (3) Exclusive of accrued interest and dividends, if any. (4) The amount of the registration fee has been calculated in accordance with Rule 457(o) under the Securities Act of 1933. (5) There is also being registered hereunder a Guarantee of PacifiCorp in connection with the issuance of Preferred Securities of PacifiCorp Delaware, L.P., for which no separate consideration will be received.
___________________________ THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. =========================================================================== EXPLANATORY NOTE This Registration Statement contains three forms of Prospectus Supplement to the Prospectus included herein: the first form is to be used in connection with an offering by PacifiCorp of Junior Subordinated Debentures, the second form is to be used in connection with an offering by PacifiCorp Delaware, L.P. of fixed rate Cumulative Monthly Income Preferred Securities, and the third form is to be used in connection with an offering by PacifiCorp Delaware, L.P. of adjustable rate Cumulative Monthly Income Preferred Securities. SUBJECT TO COMPLETION, DATED OCTOBER __, 1994 PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED , 1994 $__________ PACIFICORP ___% DEFERRABLE INTEREST JUNIOR SUBORDINATED DEBENTURES, SERIES A, DUE 2034 ____________________ Interest on the % Deferrable Interest Junior Subordinated Debentures, Series A, Due 2034 (the "Series A Junior Subordinated Debentures") is payable monthly in arrears on the last day of each calendar month of each year, commencing , 1994. The Series A Junior Subordinated Debentures will be redeemable at the option of PacifiCorp ("PacifiCorp"), in whole or in part, on or after , 1999 at the redemption prices set forth herein. The Series A Junior Subordinated Debentures will be issued only in registered form in denominations of $__________ and integral multiples thereof. See "Description of the Series A Junior Subordinated Debentures." The obligations of PacifiCorp under the Series A Junior Subordinated Debentures are subordinate and junior in right of payment to Senior Indebtedness (as defined in the accompanying Prospectus) of PacifiCorp. At June 30, 1994, Senior Indebtedness of PacifiCorp aggregated approximately $3.7 billion. Senior Indebtedness includes only indebtedness of PacifiCorp on an unconsolidated basis. ____________________ SEE "INVESTMENT CONSIDERATIONS" FOR CERTAIN INFORMATION RELEVANT TO AN INVESTMENT IN THE SERIES A JUNIOR SUBORDINATED DEBENTURES, INCLUDING THE PERIOD AND CIRCUMSTANCES DURING AND UNDER WHICH PAYMENT OF INTEREST ON THE SERIES A JUNIOR SUBORDINATED DEBENTURES MAY BE DEFERRED AND THE RELATED FEDERAL INCOME TAX CONSEQUENCES. Application will be made to list the Series A Junior Subordinated Debentures on the New York Stock Exchange. Listing will be made subject to meeting the requirements of such Exchange, including those relating to distribution. ____________________ THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS TO WHICH IT RELATES. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ____________________
Initial Public Underwriting Proceeds to Offering Price(1) Commission(2) PacifiCorp(1)(3) ----------------- ------------- ---------------- Per Series A Junior Subordinated Debenture . . . . . . . . . . . % % % Total . . . . . . . . . . . . . . $ $ $ __________ (1) Plus accrued interest, if any, from , 1994. (2) PacifiCorp has agreed to indemnify the several Underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended. (3) Before deducting estimated expenses of $ payable by PacifiCorp.
____________________ The Series A Junior Subordinated Debentures are offered severally by the Underwriters, as specified herein, subject to receipt and acceptance by them and subject to their right to reject any order in whole or in part. It is expected that delivery of the Series A Junior Subordinated Debentures will be ready for delivery in New York, New York, on or about , 1994 ____________________ GOLDMAN, SACHS & CO. SMITH BARNEY INC. ____________________ THE DATE OF THIS PROSPECTUS SUPPLEMENT IS , 1994. Information contained herein is subject to completion or amendment. A registration statement relating to these securities has been filed with the Securities and Exchange Commission. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This prospectus supplement shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any State in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such State. IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES OFFERED HEREBY AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE, IN THE OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. S-2 PACIFICORP PacifiCorp is an electric utility that conducts a retail electric utility business through two divisions, Pacific Power & Light Company ("Pacific Power") and Utah Power & Light Company ("Utah Power"), and engages in power production and sales on a wholesale basis under the name PacifiCorp. PacifiCorp is the indirect owner, through PacifiCorp Holdings, Inc. (a wholly-owned subsidiary), of 87% of Pacific Telecom, Inc. ("Pacific Telecom") and 100% of PacifiCorp Financial Services, Inc. ("PFS"). Pacific Power and Utah Power furnish electric service in portions of seven western states: California, Idaho, Montana, Oregon, Utah, Washington and Wyoming. Pacific Telecom, through its subsidiaries, provides local telephone service and access to the long distance network in Alaska, seven other western states and three midwestern states, provides intrastate and interstate long distance communication services in Alaska, provides cellular mobile telephone services, and is engaged in sales of capacity in and operation of a submarine fiber optic cable between the United States and Japan. PFS plans to sell substantial portions of its loan, leasing and real estate investments over the next several years. The principal executive offices of PacifiCorp are located at 700 NE Multnomah, Suite 1600, Portland, Oregon 97232; the telephone number is (503) 731-2000. INVESTMENT CONSIDERATIONS Prospective purchasers of Series A Junior Subordinated Debentures should carefully review the information contained elsewhere in this Prospectus Supplement and in the accompanying Prospectus and should particularly consider the following matters: SUBORDINATION OF SERIES A JUNIOR SUBORDINATED DEBENTURES. The obligations of PacifiCorp under the Series A Junior Subordinated Debentures are subordinate and junior in right of payment to Senior Indebtedness (as defined in the accompanying Prospectus) of PacifiCorp. At June 30, 1994, Senior Indebtedness of PacifiCorp aggregated approximately $3.7 billion. There are no terms in the Series A Junior Subordinated Debentures that limit PacifiCorp's ability to incur additional indebtedness, including indebtedness that ranks senior to the Series A Junior Subordinated Debentures. See "Description of the Junior Subordinated Debentures--Subordination" in the accompanying Prospectus. OPTION TO EXTEND INTEREST PAYMENT PERIOD. PacifiCorp has the right under the Indenture (as defined herein) to extend the interest payment period from time to time on the Series A Junior Subordinated Debentures to a period not exceeding 60 consecutive months, and, as a consequence, monthly interest payments on the Series A Junior Subordinated Debentures would be deferred (but would continue to accrue with interest thereon) during any such extended interest payment period. In the event that PacifiCorp exercises this right, PacifiCorp may not declare or pay dividends on, or redeem, purchase or acquire, any of its capital stock. Prior to the termination of any such extension period, PacifiCorp may further extend the interest payment period, provided that any such extension period together with all such previous and further extensions thereof may not exceed 60 consecutive months. Upon the termination of any extension period and the payment of all amounts then due, PacifiCorp may select a new extension period, subject to the above requirements. PacifiCorp believes that the extension of an interest payment period on the Series A Junior Subordinated Debentures is unlikely. See "Description of the Series A Junior Subordinated Debentures--Option to Extend Interest Payment Period." Should an extended interest payment period occur, holders of the Series A Junior Subordinated Debentures will continue to accrue income for United States federal income tax purposes, even though interest is not being paid on a current basis. As a result, such a holder will include such interest in gross income for United States federal income tax purposes in advance of the receipt of cash, and will not receive the cash from PacifiCorp related to such income if such a holder disposes of his or her Series A Junior Subordinated Debentures prior to the record date for payment of interest. See "United States Taxation--United States Holders." S-3 SELECTED FINANCIAL INFORMATION (Dollar amounts in millions, except per share amounts) The following selected financial information for each of the three years in the period ended December 31, 1993 and six months ended June 30, 1993 and 1994, has been derived from the consolidated financial statements of PacifiCorp for the respective periods. The consolidated financial statements for the three-year period ended December 31, 1993 have been audited by Deloitte & Touche LLP, independent auditors, and the reports of Deloitte & Touche LLP are incorporated in the accompanying Prospectus by reference. This selected financial information should be read in conjunction with the financial statements and related notes thereto included in the Incorporated Documents (as defined in the accompanying Prospectus).
Twelve Months Ended Six Months December 31, Ended June 30, -------------------- -------------- 1991 1992 1993 1993 1994 ---- ---- ---- ---- ---- Income Statement Data: Revenues $3,168 $3,242 $3,412 $1,668 $1,701 Income from Operations (1) 941 633 916 445 453 Income from Continuing Operations 447 150 423 204 210 Discontinued Operations (2) 60 (491) 52 -- -- Cumulative Effect on Prior Years of a Change in Accounting for Income Taxes -- -- 4 4 -- Net Income (Loss) 507 (341) 479 208 210 Preferred Stock Dividend Requirements 26 37 39 19 20 Earnings (Loss) on Common Stock 481 (378) 440 189 190 Earnings (Loss) per Common Share: Continuing Operations 1.63 .42 1.40 .68 .67 Discontinued Operations .23 (1.84) .19 -- -- Cumulative Effect on Prior Years of a Change in Accounting for Income Taxes -- -- .01 .01 -- June 30, 1994 --------------------------------------- Actual As Adjusted(3) ----------------- ------------------ Amount % Amount % ------ --- ------ --- Capital Structure: Long-Term Debt and Capital Lease Obligations $3,814 49% $ % Preferred Stock 367 5 367 5 Preferred Stock Subject to Mandatory Redemption 219 3 219 3 Common Equity 3,345 43 3,345 43 ----- --- ----- --- Total $7,745 100% $ 100% ===== === ===== === Short-Term Debt $ 528 Long-term Debt and Capital Lease Obligations Currently Maturing $ 164 $ 164 ____________________ (1) Income before income taxes, interest, other nonoperating items, discontinued operations and cumulative effect of a change in an accounting principle. (2) Discontinued operations represents PacifiCorp's interests in NERCO, Inc. and an international communications subsidiary of Pacific Telecom. (3) Adjusted to give effect to the issuance and sale of the Series A Junior Subordinated Debentures and the application of net proceeds thereof to retire short-term debt. See "Use of Proceeds."
USE OF PROCEEDS The proceeds from the sale of the Series A Junior Subordinated Debentures will be used by PacifiCorp to repay short-term borrowings and for the other corporate purposes. S-4 DESCRIPTION OF THE SERIES A JUNIOR SUBORDINATED DEBENTURES The following description of the Series A Junior Subordinated Debentures supplements and should be read in conjunction with the description of the general terms and provisions of the Junior Subordinated Debentures set forth in the accompanying Prospectus under the caption "Description of the Junior Subordinated Debentures." The following description does not purport to be complete and is qualified in its entirety by reference to the description in the accompanying Prospectus and the Indenture, dated as of , 1994, between PacifiCorp and The Bank of New York, as Trustee, as supplemented by a First Supplemental Indenture, dated as of , 1994 (such Indenture, as so supplemented, is hereinafter referred to as the "Indenture"). GENERAL The Series A Junior Subordinated Debentures will be issued as a series of unsecured Junior Subordinated Debentures under the Indenture. The Series A Junior Subordinated Debentures will be limited in aggregate principal amount to $ million. The entire principal amount of the Series A Junior Subordinated Debentures will become due and payable, together with any accrued and unpaid interest thereon, on , 2034. The Series A Junior Subordinated Debentures will initially be issued as a Global Security (as defined below). As described herein, under certain limited circumstances Series A Junior Subordinated Debentures may be issued in certificated form in exchange for a Global Security (as defined below). See "--Book-Entry and Settlement." In the event that Series A Junior Subordinated Debentures are issued in certificated form, such Series A Junior Subordinated Debentures will be in denominations of $25 and integral multiples thereof and may be transferred or exchanged at the offices described below. Payments on Series A Junior Subordinated Debentures issued as a Global Security will be made to The Depository Trust Company (the "Depository" or "DTC"), as the depository for the Series A Junior Subordinated Debentures. In the event Series A Junior Subordinated Debentures are issued in certificated form, principal and interest will be payable, the transfer of the Series A Junior Subordinated Debentures will be registerable and Series A Junior Subordinated Debentures will be exchangeable for Series A Junior Subordinated Debentures of other denominations of a like aggregate principal amount at the corporate trust office of the Trustee in The City of New York; provided, that payment of interest may be made at the option of PacifiCorp by check mailed to the address of the persons entitled thereto. OPTIONAL REDEMPTION PacifiCorp shall have the right to redeem the Series A Junior Subordinated Debentures, in whole or in part, from time to time, on or after , 1999, upon not less than 30 nor more than 60 days' notice, at a redemption price equal to 100% of the principal amount to be redeemed plus any accrued and unpaid interest to the redemption date. INTEREST Each Series A Junior Subordinated Debenture will bear interest at the rate of % per annum from the original date of issuance, payable monthly in arrears on the last day of each calendar month of each year (each, an "Interest Payment Date"), commencing , 1994, to the person in whose name such Series A Junior Subordinated Debenture is registered, subject to certain exceptions, at the close of business on the Business Day next preceding such Interest Payment Date. In the event the Series A Junior Subordinated Debentures shall not continue to remain in book-entry-only form, PacifiCorp shall have the right to select record dates which shall be more than one Business Day prior to the Interest Payment Date. The amount of interest payable for any period will be computed on the basis of a 360-day year of twelve 30-day months. In the event that any date on which interest is payable on the Series A Junior Subordinated Debentures is not a Business Day, then payment of the interest payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment S-5 in respect of any such delay), except that, if such Business Day is in the next succeeding calendar year, such payment shall be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such date. A "Business Day" shall mean any day other than a day on which banking institutions in The City of New York are authorized or required by law to close. OPTION TO EXTEND INTEREST PAYMENT PERIOD PacifiCorp shall have the right at any time during the term of the Series A Junior Subordinated Debentures to extend the interest payment period from time to time to a period not exceeding 60 consecutive months (the "Extension Period"), at the end of which Extension Period PacifiCorp shall pay all interest then accrued and unpaid (together with interest thereon at the rate specified for the Series A Junior Subordinated Debentures to the extent permitted by applicable law); provided, that, during any such Extension Period, PacifiCorp shall not declare or pay any dividends on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of its capital stock. Prior to the termination of any such Extension Period, PacifiCorp may further extend the interest payment period, provided that such Extension Period together with all such previous and further extensions thereof may not exceed 60 consecutive months. Upon the termination of any Extension Period and the payment of all amounts then due, PacifiCorp may select a new Extension Period, subject to the above requirements. No interest during an Extension Period, except at the end thereof, shall be due and payable. PacifiCorp shall give the holders of the Series A Junior Subordinated Debentures notice of its selection of such Extension Period ten Business Days prior to the earlier of (i) the Interest Payment Date or (ii) the date PacifiCorp is required to give notice to the New York Stock Exchange or other applicable self-regulatory organization or to holders of the Series A Junior Subordinated Debentures, of the record or payment date of such related interest payment but in any event not less than two Business Days prior to such record date. EVENTS OF DEFAULT In the case any Event of Default (as defined in the Indenture) shall occur and be continuing, PacifiCorp Delaware will have the right to declare the principal of and the interest on the Series A Junior Subordinated Debentures and any other amounts payable under the Indenture to be forthwith due and payable and to enforce its other rights as a creditor with respect to the Series A Junior Subordinated Debentures. BOOK-ENTRY AND SETTLEMENT The Series A Junior Subordinated Debentures will be issued in the form of one or more global certificates (each, a "Global Security") registered in the name of the nominee of DTC. Except under the limited circumstances described below, Series A Junior Subordinated Debentures represented by the Global Security will not be exchangeable for, and will not otherwise be issuable as, Series A Junior Subordinated Debentures in definitive form. The Global Securities described above may not be transferred except by DTC to a nominee of DTC or by a nominee of DTC to DTC or another nominee of DTC or to a successor depository or its nominee. The laws of some jurisdictions require that certain purchasers of securities take physical delivery of such securities in definitive form. Such laws may impair the ability to transfer beneficial interests in such a Global Security. Except as provided below, owners of beneficial interests in such a Global Security will not be entitled to receive physical delivery of Series A Junior Subordinated Debentures in definitive form and will not be considered the Holders (as defined in the Indenture) thereof for any purpose under the Indenture, and no Global Security representing Series A Junior Subordinated Debentures shall be exchangeable, except for another Global Security of like denomination and tenor to be registered in the name of DTC or its nominee or to a successor depository or its nominee. Accordingly, each beneficial owner must rely on the procedures of DTC and, if such person is not a Participant (as defined below), on the procedures of the Participant through which such person owns its interest, to exercise any rights of a Holder under the Indenture. S-6 THE DEPOSITORY. DTC will act as securities depository for the Series A Subordinated Debentures. The Series A Subordinated Debentures will be issued only as fully-registered securities registered in the name of Cede & Co. (DTC's nominee). One or more fully-registered global certificates will be issued, representing in the aggregate the total number of Series A Subordinated Debentures and will be deposited with DTC. 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 17A of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). DTC holds securities that its participants ("Participants") deposit with DTC. DTC also facilitates the settlement among Participants of securities transactions, such as transfers and pledges, in deposited securities through electronic computerized book-entry changes in Participants' accounts, thereby eliminating the need for physical movement of securities certificates. Direct Participants include securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations ("Direct Participants"). DTC is owned by a number of its Direct Participants and by the New York Stock Exchange, Inc. (the "New York Stock Exchange"), the American Stock Exchange, Inc., and the National Association of Securities Dealers, Inc. Access to the DTC system is also available to others such as securities brokers and dealers, banks and trust companies that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ("Indirect Participants"). The rules applicable to DTC and its Participants are on file with the Securities and Exchange Commission. Purchases of Series A Subordinated Debentures within the DTC system must be made by or through Direct Participants, which will receive a credit for the Series A Subordinated Debentures on DTC's records. The ownership interest of each actual purchaser of each Series A Subordinated Debentures ("Beneficial Owner") 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 purchased Series A Subordinated Debentures. Transfers of ownership interests in the Series A Subordinated Debentures 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 Series A Subordinated Debentures, except in the event that use of the book-entry system for the Series A Subordinated Debentures is discontinued. DTC has no knowledge of the actual Beneficial Owners of the Series A Subordinated Debentures; DTC's records reflect only the identity of the Direct Participants to whose accounts such Series A Subordinated Debentures are credited, which may or may not be the Beneficial Owners. The Participants will 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 will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Redemption notices shall be sent to Cede & Co. If less than all of the Series A Subordinated Debentures are being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such series to be redeemed. Interest payments on the Series A Subordinated Debentures will be made to DTC. DTC's practice is to credit Direct Participants' accounts on the relevant payment date in accordance with their respective holdings shown on DTC's records unless DTC has reason to believe that it will not receive payments on such payment date. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices and will be the responsibility of such Participant and not of DTC or PacifiCorp, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of interest to DTC is the responsibility of PacifiCorp, disbursement of such payments to Direct S-7 Participants is the responsibility of DTC, and disbursement of such payments to the Beneficial Owners is the responsibility of Direct and Indirect Participants. DTC may discontinue providing its services as securities depository with respect to the Series A Subordinated Debentures at any time by giving reasonable notice to PacifiCorp. Under such circumstances, in the event that a successor securities depository is not obtained, Series A Preferred Security certificates are required to be printed and delivered. Additionally, PacifiCorp may decide to discontinue use of the system of book-entry transfers through DTC (or a successor depository). In that event, certificates for the Series A Subordinated Debentures will be printed and delivered. In each of the above circumstances, PacifiCorp will appoint a paying agent with respect to the Series A Subordinated Debentures. The information in this section concerning DTC and DTC's book-entry system has been obtained from sources that PacifiCorp believes to be reliable, but PacifiCorp takes no responsibility for the accuracy thereof. Neither PacifiCorp, the Trustee, any paying agent nor any other agent of PacifiCorp or the Trustee will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests in a Global Security for such Series A Junior Subordinated Debentures or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests. DISCONTINUANCE OF THE DEPOSITORY'S SERVICES. A Global Security shall be exchangeable for Series A Junior Subordinated Debentures registered in the names of persons other than DTC or its nominee only if (i) DTC notifies PacifiCorp that it is unwilling or unable to continue as a depository for such Global Security and no successor depository shall have been appointed, or if any time DTC ceases to be a clearing agency registered under the Exchange Act at a time when DTC is required to be so registered to act as such depository, (ii) PacifiCorp in its sole discretion determines that such Global Security shall be so exchangeable or (iii) there shall have occurred an Event of Default with respect to such Series A Junior Subordinated Debentures. Any Global Security that is exchangeable pursuant to the preceding sentence shall be exchangeable for Series A Junior Subordinated Debentures registered in such names as the Depository shall direct. It is expected that such instructions will be based upon directions received by the Depository from its Participants with respect to ownership of beneficial interests in such Global Security. REGISTRAR AND TRANSFER AGENT PacifiCorp will act as registrar and transfer agent for the Series A Junior Subordinated Debentures. S-8 UNITED STATES TAXATION GENERAL This section is a summary of certain United States federal income tax considerations that may be relevant to prospective purchasers of Series A Junior Subordinated Debentures and represents the opinion of Stoel Rives Boley Jones & Grey, counsel to PacifiCorp, insofar as it relates to matters of law and legal conclusions. This section is based upon current provisions of the Internal Revenue Code of 1986, as amended (the "Code"), existing and proposed regulations thereunder and current administrative rulings and court decisions, all of which are subject to change. Subsequent changes may cause tax consequences to vary substantially from the consequences described below. No attempt has been made in the following discussion to comment on all United States federal income tax matters affecting purchasers of Series A Junior Subordinated Debentures. Moreover, the discussion focuses on holders of Series A Junior Subordinated Debentures who are individual citizens or residents of the United States that hold the Series A Junior Subordinated Debentures as a capital asset and has only limited application to corporations, estates, trusts or non-resident aliens. Accordingly, each prospective purchaser of Series A Junior Subordinated Debentures should consult, and should depend on, his or her own tax advisor in analyzing the federal, state, local and foreign tax consequences of the purchase, ownership or disposition of Series A Junior Subordinated Debentures. UNITED STATES HOLDERS For purposes of this discussion, a United States Holder is a Beneficial Owner that is (i) a citizen or resident of the United States, (ii) a domestic corporation or (iii) otherwise subject to United States federal income taxation on a net income basis in respect of the Series A Junior Subordinated Debentures. Because the interest payment period is extendable by PacifiCorp, the interest on the Series A Junior Subordinated Debentures will be treated as "original issue discount" pursuant to Code Sections 1271 et seq. and the Treasury Regulations promulgated thereunder. Therefore, interest on Series A Junior Subordinated Debentures will be included in the income of a United States Holder as it accrues, rather than when it is paid, regardless of the United States Holder's regular method of accounting for tax purposes. United States Holders may therefore include interest in income for taxable years prior to the year in which the interest is actually received. This should occur, however, only during an Extension Period or any other nonpayment period. A United States Holder will generally recognize gain or loss on the sale or retirement of a Series A Junior Subordinated Debenture equal to the difference between the amount realized from the sale or retirement and the United States Holder's tax basis in the Series A Junior Subordinated Debentures. Such gain or loss will be capital gain or loss, and will be long-term capital gain or loss if the Series A Junior Subordinated Debenture has been held for more than one year. A United States Holder's tax basis in a Series A Junior Subordinated Debenture will generally equal the amount paid for it, increased by the amount of any accrued but unpaid interest. UNITED STATES ALIEN HOLDERS For purposes of the following discussion, a "United States Alien Holder" is any holder that is (i) a nonresident alien individual, (ii) a foreign corporation, partnership or (iii) an estate or trust that has a foreign fiduciary, in either case not subject to United States federal income tax on a net income basis in respect of a Series A Junior Subordinated Debenture. Under current United States federal income tax law, subject to the discussion below with respect to backup withholding: (i) Payments by PacifiCorp or any of its paying agents in respect of a Series A Junior Subordinated Debenture to a United States Alien Holder will not be subject to United States federal withholding tax provided that (a) the Beneficial Owner of the Series A Junior Subordinated Debenture does not actually or constructively own 10% or more of the total combined voting S-9 power of all classes of capital stock of PacifiCorp entitled to vote, (b) the Beneficial Owner of the Series A Junior Subordinated Debenture is not a controlled foreign corporation that is related to PacifiCorp through stock ownership and (c) the Beneficial Owner provides the correct certification of United States Alien Holder status (which may generally be satisfied by providing an IRS Form W-8 certifying that the Beneficial Owner is a United States Alien Holder and providing the name and address of the Beneficial Owner); and (ii) A United States Alien Holder will not be subject to United States federal withholding tax and generally will not be subject to United States federal income tax on gain realized from the sale or exchange of a Series A Junior Subordinated Debentures. Under certain conditions, a United States Alien Holder may be subject to United States federal income tax on gain or income received with respect to the sale or exchange of a Series A Junior Subordinated Debentures. Such income taxation may occur, for example, if the United States Alien Holder (a) is engaged in a trade or business in the United States and gain or income is effectively connected with the conduct of that trade or business or (b) is an individual present in the United States for 183 days or more during the taxable year, and certain other conditions are met. Such taxation is beyond the scope of this summary and should be discussed with a tax advisor. If income is effectively connected with the conduct of a trade or business in the United States by a United States Alien Holder, withholding of United States federal income tax may be required unless the United States Alien Holder files with PacifiCorp or its paying agent an IRS form to the effect that the income is so effectively connected BACKUP WITHHOLDING AND INFORMATION REPORTING In general, information reporting requirements will apply to payments of principal and interest on a Series A Junior Subordinated Debenture, and the proceeds of the sale of a Series A Junior Subordinated Debenture prior to maturity within the United States, with respect to non-corporate United States Holders, and "backup withholding" at a rate of 31% will apply to such payments if the United States Holder fails to provide an accurate taxpayer identification number or to report all interest and dividends required to be shown on its federal income tax returns. Information reporting and backup withholding will not apply to payments of principal and interest made by PacifiCorp or a paying agent to a United States Alien Holder on a Series A Junior Subordinated Debenture if the certification described in clause (i)(c) under "United States Alien Holders" above is received, provided that the payor does not have actual knowledge that the holder is a United States Holder. Payments of the proceeds from the sale by a United States Alien Holder of Series A Junior Subordinated Debenture made to or through a foreign office of a broker generally will not be subject to information reporting or backup withholding, except that, if the broker is a United States person, a controlled foreign corporation for United States tax purposes, or a foreign person 50% or more of whose gross income is effectively connected with a United States trade or business for a specified three-year period, information reporting may apply to such payments. Payments of the proceeds from the sale of Series A Junior Subordinated Debenture to or through the United States office of a broker is subject to information reporting and backup withholding unless the holder or beneficial owner certifies as to its non-United States status or otherwise establishes an exemption from information reporting and backup withholding. S-10 UNDERWRITING Subject to the terms and conditions of the Underwriting Agreement, PacifiCorp has agreed to sell to each of the Underwriters named below (the "Underwriters"), and each of the Underwriters, for whom Goldman, Sachs & Co. Smith Barney Inc. and are acting as Representatives (the "Representatives"), has severally agreed to purchase from PacifiCorp the principal amount of Series A Subordinated Debentures set forth opposite its name below: Principal Amount of Series A Junior Subordinated Underwriter Debentures ----------- ------------------- Goldman, Sachs & Co. . . . . . . . . $ Smith Barney Inc.. . . . . . . . . . $ ---------- Total . . . . . . . . . . . . . $ ========== The Underwriters have advised PacifiCorp that they propose to offer the Series A Junior Subordinated Debenture in part directly to the public at the initial public offering price set forth on the cover page of this Prospectus Supplement, and in part to certain securities dealers at such price less a concession of ____% of the principal amount of the Series A Junior Subordinated Debentures. The Underwriters may allow, and such dealers may reallow, a concession not in excess of ___% of the principal amount of the Series A Junior Subordinated Debentures to certain brokers and dealers. After the Series A Junior Subordinated Debentures are released for sale to the public, the offering price and other selling terms may from time to time be varied by the Representatives. PacifiCorp has agreed, during the period beginning from the date of the Underwriting Agreement and continuing to and including 30 days after the closing date, not to offer, sell, contract to sell or otherwise dispose of any Series A Junior Subordinated Debentures or any other securities of PacifiCorp that are substantially similar to the Series A Subordinated Debentures, without the prior written consent of the Underwriters. Prior to this offering, there has been no public market for the Series A Junior Subordinated Debentures. Application will be made to list the Series A Junior Subordinated Debentures on the New York Stock Exchange. In order to meet one of the requirements for listing the Series A Junior Subordinated Debenture on the New York Stock Exchange, the Underwriters will undertake to sell lots of 100 or more Series A Junior Subordinated Debenture to a minimum of 400 beneficial holders. PacifiCorp has agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended, or to have PacifiCorp and PacifiCorp contribute to payments such Underwriters may be required to make on respect thereof. Certain of the Underwriters engage in transactions with, and from time to time have performed services for, PacifiCorp and its subsidiaries in the ordinary course of business. LEGAL MATTERS The validity of the Indenture and the Series A Junior Subordinated Debentures will be passed upon on behalf of PacifiCorp by Stoel Rives Boley Jones & Grey, Portland, Oregon and on behalf of the Underwriters by Winthrop, Stimson, Putnam & Roberts, New York, New York. Statements as to United States taxation in the Prospectus Supplement under the caption "United States Taxation" have been passed upon for PacifiCorp by Stoel Rives Boley Jones & Grey, counsel to PacifiCorp, and are stated herein on their authority. S-11 =============================================================== NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES DESCRIBED IN THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY SUCH SECURITIES IN ANY CIRCUMSTANCE IN WHICH SUCH OFFER OR SOLICITATION IS UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN OR THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH INFORMATION. ____________________ TABLE OF CONTENTS PROSPECTUS SUPPLEMENT PacifiCorp . . . . . . . . . . . . . . . . . . . . . . . . . . S-2 Investment Considerations. . . . . . . . . . . . . . . . . . . S-2 Selected Financial Information . . . . . . . . . . . . . . . . S-3 Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . S-3 Description of the Series A Junior Subordinated Debentures . . . . . . . . . . . . . . . S-4 United States Taxation . . . . . . . . . . . . . . . . . . . . S-8 Underwriting . . . . . . . . . . . . . . . . . . . . . . . . . S-10 Legal Matters. . . . . . . . . . . . . . . . . . . . . . . . . S-10 PROSPECTUS Available Information. . . . . . . . . . . . . . . . . . . . . 2 Incorporation of Certain Documents by Reference . . . . . . . . . . . . . . . . . . . 2 PacifiCorp . . . . . . . . . . . . . . . . . . . . . . . . . . 3 PacifiCorp Delaware, L.P.. . . . . . . . . . . . . . . . . . . 3 Consolidated Ratios of Earnings to Fixed Charges . . . . . . . . . . . . . . . . . . . . . . 4 Consolidated Ratios of Earnings to Combined Fixed Charges and Preferred Stock Dividends. . . . . . . . . . . . . . . . . . . . . . . 4 Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . 4 Description of the Junior Subordinated Debentures. . . . . . . . . . . . . . . . . . . 4 Description of the Preferred Securities. . . . . . . . . . . . 10 Description of the Guarantee . . . . . . . . . . . . . . . . . 11 Plan of Distribution . . . . . . . . . . . . . . . . . . . . . 13 Experts. . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Legal Opinions . . . . . . . . . . . . . . . . . . . . . . . . 14 =============================================================== S-11 =============================================================== $ PACIFICORP % DEFERRABLE INTEREST JUNIOR SUBORDINATED DEBENTURES, SERIES A, DUE 2034 ____________________ PROSPECTUS SUPPLEMENT ____________________ GOLDMAN, SACHS & CO. SMITH BARNEY INC. =============================================================== SUBJECT TO COMPLETION, DATED OCTOBER __, 1994 PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED , 1994 _____ PREFERRED SECURITIES PACIFICORP DELAWARE % CUMULATIVE MONTHLY INCOME PREFERRED SECURITIES, SERIES A ("MIPS"*) (LIQUIDATION PREFERENCE $25 PER PREFERRED SECURITY) GUARANTEED TO THE EXTENT SET FORTH HEREIN BY PACIFICORP The % Cumulative Monthly Income Preferred Securities, Series A (the "Series A Preferred Securities"), representing the limited partner interests offered hereby are being issued by PacifiCorp Delaware, L.P., a limited partnership formed under the laws of the State of Delaware ("PacifiCorp Delaware"). PacifiCorp, an Oregon corporation ("PacifiCorp"), is the general partner in PacifiCorp Delaware. PacifiCorp Delaware exists for the sole purpose of issuing its limited partnership interests and investing the proceeds thereof in debt securities of PacifiCorp. The limited partner interests represented by the Series A Preferred Securities will have a preference with respect to cash distributions and amounts payable on liquidation over the general partner's interest in PacifiCorp Delaware. Holders of the Series A Preferred Securities will be entitled to receive cumulative cash distributions at an annual rate of % of the liquidation preference of $25 per Series A Preferred Security, accruing from the date of original issuance and payable monthly in arrears on the last day of each calendar month of each year, commencing , 1994 ("dividends"). The payment of dividends, out of moneys held by PacifiCorp Delaware, and payments on liquidation of PacifiCorp Delaware or the redemption of Series A Preferred Securities, as set forth below, are guaranteed by PacifiCorp to the extent described herein and in the accompanying Prospectus (the "Guarantee"). See "Description of the Guarantee" in the accompanying Prospectus. If PacifiCorp fails to make interest payments on ___% Deferrable Interest Junior Subordinated Debentures, Series A (the "Series A Junior Subordinated Debentures") purchased by PacifiCorp Delaware with the proceeds of the offering of the Series A Preferred Securities, PacifiCorp Delaware will have insufficient funds to pay dividends on the Series A Preferred Securities. The Guarantee does not cover payment of dividends when PacifiCorp Delaware does not have sufficient funds to pay such dividends. In such event, the remedy of a holder of Series A Preferred Securities is to enforce the rights of PacifiCorp Delaware under the Series A Junior Subordinated Debentures. The Series A Preferred Securities are redeemable at the option of PacifiCorp Delaware, in whole or in part, from time to time, on or after , 1999, at $25 per Series A Preferred Security plus accrued and unpaid dividends thereon (including any interest thereon) to the date fixed for redemption (the "Redemption Price"). See "Description of the Series A Preferred Securities-Optional Redemption." Upon the occurrence of certain events arising from a change in law or a change in legal interpretation regarding tax matters, PacifiCorp, in its capacity as the general partner of PacifiCorp Delaware (the "General Partner"), may dissolve PacifiCorp Delaware and cause to be distributed to the holders of the Series A Preferred Securities, on a pro rata basis, the Series A Junior Subordinated Debentures in lieu of any cash distribution. If the Series A Junior Subordinated Debentures are distributed to the holders of the Series A Preferred Securities, PacifiCorp will use its best efforts to have the Series A Junior Subordinated Debentures listed on the New York Stock Exchange or on such other exchange as the Series A Preferred Securities are then listed. The obligations of PacifiCorp under the Series A Junior Subordinated Debentures are subordinate and junior in right of payment to Senior Indebtedness (as defined in the accompanying Prospectus) of PacifiCorp. At June 30, 1994, Senior Indebtedness of PacifiCorp aggregated approximately $3.7 billion. Senior Indebtedness includes only indebtedness of PacifiCorp on an unconsolidated basis. See "Description of the Series A Preferred Securities-Tax Event Distribution" and "Description of the Series A Junior Subordinated Debentures." In the event of the dissolution of PacifiCorp Delaware, the holders of the Series A Preferred Securities will be entitled to receive for each Series A Preferred Security a liquidation preference of $25 plus accrued and unpaid dividends thereon (including any interest thereon) to the date of payment, subject to certain limitations, unless, in connection with such dissolution, Series A Junior Subordinated Debentures are distributed to the holders of the Series A Preferred Securities. See "Description of the Series A Preferred Securities-Liquidation Distribution Upon Dissolution." _______________ SEE "INVESTMENT CONSIDERATIONS" FOR CERTAIN INFORMATION RELEVANT TO AN INVESTMENT IN THE SERIES A PREFERRED SECURITIES, INCLUDING THE PERIOD DURING WHICH AND CIRCUMSTANCES UNDER WHICH PAYMENT OF DIVIDENDS ON THE SERIES A PREFERRED SECURITIES MAY BE DEFERRED. _______________ Application will be made to list the Series A Preferred Securities on the New York Stock Exchange. Listing will be made subject to meeting the requirements of such Exchange, including those relating to distribution. _______________ THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS TO WHICH IT RELATES. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ___________________________
Proceeds to Initial Public Underwriting PacifiCorp Offering Price Commission(1) Delaware(2)(3) ______________ __________ ______________ Per Series A Preferred Security . . . $ (2) $ Total . . . . . . . . . . $ (2) $ __________ (1) PacifiCorp Delaware and PacifiCorp have agreed to indemnify the several Underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended. See "Underwriting." (2) Because the proceeds of the sale of the Series A Preferred Securities will ultimately be invested in Series A Junior Subordinated Debentures, the Underwriting Agreement provides that PacifiCorp will pay to the Underwriters $ per Series A Preferred Security (or $ in the aggregate); provided, that such compensation will be $ per Series A Preferred Security sold to certain institutions. Therefore, to the extent that Series A Preferred Securities are sold to such institutions, the actual amount of underwriting commission will be less than the amount specified in the preceding sentence. See "Underwriting." (3) Expenses of the offering which are payable by PacifiCorp are estimated to be $ .
___________________________ The Series A Preferred Securities offered hereby are offered severally by the Underwriters, as specified herein, and subject to receipt and acceptance by them and subject to their right to reject any order in whole or in part. It is expected that delivery of the Series A Preferred Securities will be made only in book-entry form through the facilities of The Depository Trust Company on or about , 1994. __________ * An application has been filed by Goldman, Sachs & Co. with the United States Patent and Trademark Office for the registration of the MIPS servicemark. ___________________________ GOLDMAN, SACHS & CO. SMITH BARNEY INC. THE DATE OF THIS PROSPECTUS SUPPLEMENT IS , 1994. INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH JURISDICTION. IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES OFFERED HEREBY AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE, IN THE OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. S-2 PACIFICORP DELAWARE, L.P. PacifiCorp Delaware is a limited partnership which was formed under the Delaware Revised Uniform Limited Partnership Act (the "Partnership Act") by filing a certificate of limited partnership with the Delaware Secretary of State on August 26, 1994. The initial partners in PacifiCorp Delaware are PacifiCorp, as the General Partner, and PacifiCorp Preferred Capital, Inc., a Delaware corporation ("Capital"), as limited partner. Upon the issuance of the Series A Preferred Securities, which securities represent limited partner interests in PacifiCorp Delaware, Capital will remain as a limited partner, but will have no interest in the profits and dividends or in the assets of PacifiCorp Delaware. The General Partner will agree to contribute capital to the extent required to maintain its capital at an amount equal to at least 3% of the total capital contributions to PacifiCorp Delaware. PacifiCorp and Capital entered into a limited partnership agreement dated as of August 25, 1994. Such limited partnership agreement will be amended and restated in its entirety (as so amended and restated, the "Limited Partnership Agreement") substantially in the form filed as an exhibit to the Registration Statement of which this Prospectus Supplement and the accompanying Prospectus form a part. PacifiCorp Delaware is managed by the General Partner and exists for the sole purpose of issuing its limited partnership interests and investing the proceeds thereof in deferrable interest junior subordinated debentures of PacifiCorp ("Junior Subordinated Debentures"). The rights of the holders of the Series A Preferred Securities, including economic rights, rights to information and voting rights, are set forth in the Limited Partnership Agreement and the Partnership Act. See "Description of the Series A Preferred Securities." PACIFICORP PacifiCorp is an electric utility that conducts a retail electric utility business through two divisions, Pacific Power & Light Company ("Pacific Power") and Utah Power & Light Company ("Utah Power"), and engages in power production and sales on a wholesale basis under the name PacifiCorp. PacifiCorp is the indirect owner, through PacifiCorp Holdings, Inc. (a wholly- owned subsidiary), of 87% of Pacific Telecom, Inc. ("Pacific Telecom") and 100% of PacifiCorp Financial Services, Inc. ("PFS"). Pacific Power and Utah Power furnish electric service in portions of seven western states: California, Idaho, Montana, Oregon, Utah, Washington and Wyoming. Pacific Telecom, through its subsidiaries, provides local telephone service and access to the long distance network in Alaska, seven other western states and three midwestern states, provides intrastate and interstate long distance communication services in Alaska, provides cellular mobile telephone services, and is engaged in sales of capacity in and operation of a submarine fiber optic cable between the United States and Japan. PFS plans to sell substantial portions of its loan, leasing and real estate investments over the next several years. The principal executive offices of PacifiCorp are located at 700 NE Multnomah, Suite 1600, Portland, Oregon 97232; the telephone number is (503) 731-2000. S-3 INVESTMENT CONSIDERATIONS Prospective purchasers of Series A Preferred Securities should carefully review the information contained elsewhere in this Prospectus Supplement and in the accompanying Prospectus and should particularly consider the following matters: SUBORDINATE OBLIGATIONS UNDER GUARANTEE AND SERIES A JUNIOR SUBORDINATED DEBENTURES. PacifiCorp's obligations under the Guarantee are subordinate and junior in right of payment to all other liabilities of PacifiCorp. The obligations of PacifiCorp under the Series A Junior Subordinated Debentures described under "Description of the Series A Junior Subordinated Debentures" are subordinate and junior in right of payment to Senior Indebtedness (as defined in the accompanying Prospectus) of PacifiCorp. At June 30, 1994, Senior Indebtedness of PacifiCorp aggregated approximately $3.7 billion. There are no terms in the Series A Preferred Securities, the Series A Junior Subordinated Debentures or the Guarantee that limit PacifiCorp's ability to incur additional indebtedness, including indebtedness that ranks senior to the Series A Junior Subordinated Debentures and the Guarantee. See "Description of the Guarantee-Status of the Guarantee" and "Description of the Junior Subordinated Debentures-Subordination" in the accompanying Prospectus. OPTION TO EXTEND INTEREST PAYMENT PERIOD. PacifiCorp has the right under the Indenture (as defined herein) to extend the interest payment period from time to time on the Series A Junior Subordinated Debentures to a period not exceeding 60 consecutive months, and, as a consequence, monthly dividends on the Series A Preferred Securities would be deferred (but would continue to accrue with interest thereon) by PacifiCorp Delaware during any such extended interest payment period. In the event that PacifiCorp exercises this right, PacifiCorp may not declare or pay dividends on, or redeem, purchase or acquire, any of its capital stock. Prior to the termination of any such extension period, PacifiCorp may further extend the interest payment period, provided that any such extension period together with all such previous and further extensions thereof may not exceed 60 consecutive months. Upon the termination of any extension period and the payment of all amounts then due, PacifiCorp may select a new extension period, subject to the above require- ments. PacifiCorp Delaware and PacifiCorp believe that the extension of a payment period on the Series A Junior Subordinated Debentures is unlikely. See "Description of the Series A Preferred Securities-Dividends" and "Description of the Series A Junior Subordinated Debentures-Option to Extend Interest Payment Period." Should an extended interest payment period occur, PacifiCorp Delaware will continue to accrue income for United States federal income tax purposes, which will be allocated, but not distributed, to holders of record of Series A Preferred Securities. As a result, such a holder will include such interest in gross income for United States federal income tax purposes in advance of the receipt of cash, and will not receive the cash from PacifiCorp Delaware related to such income if such a holder disposes of his or her Series A Preferred Securities prior to the record date for payment of dividends. See "United States Taxation Potential Extension of Interest Payment Period." TAX EVENT DISTRIBUTION. Upon the occurrence of a Tax Event (as defined herein), the General Partner will dissolve PacifiCorp Delaware and cause Series A Junior Subordinated Debentures to be distributed to the holders of the Series A Preferred Securities in connection with the liquidation of PacifiCorp Delaware; provided, however, that, as a condition to such dissolution and distribution, PacifiCorp Delaware shall be required to obtain an opinion of counsel (which may be regular tax counsel to PacifiCorp or an affiliate, but not an employee thereof) to the effect that the holders of the Series A Preferred Securities will not recognize any gain or loss for federal income tax purposes as a result of such dissolution and distribution of Series A Junior Subordinated Debentures, and, provided further, that the General Partner may elect to cause the Series A Preferred Securities to remain outstanding. See "Description of the Series A Preferred Securities-Tax Event Distribution." In April 1994, the Internal Revenue Service (the "IRS") issued certain notices generally addressing the characteristics which distinguish debt from equity for various purposes under the federal income tax laws. In these notices, the IRS indicated that transactions involving securities that, like the securities offered hereby, have both debt and equity characteristics would be reviewed with scrutiny to determine how they would be treated for tax purposes. PacifiCorp believes that interest on the Series A Junior Subordinated Debentures will be deductible under the tests referred to in these notices. If, S-4 however, the General Partner shall have obtained an opinion of nationally recognized independent tax counsel experienced in such matters to the effect that, as a result of (a) any amendment to, or change (including any announced prospective change) in, the laws (or any regulations thereunder) of the United States or any political subdivision or taxing authority thereof or therein, (b) any notice of proposed adjustment issued by the IRS to PacifiCorp or PacifiCorp Delaware, (c) any amendment to or change in an interpretation or application of such laws or regulations by any legislative body, court, governmental agency or regulatory authority (including the enactment of any legislation and the publication of any judicial decision or regulatory determination on or after such date) or (d) any interpretation or pronouncement that provides for a position with respect to such laws or regulations that differs from the generally accepted position on , 1994, which amendment or change is effective, which notice of proposed adjustment is issued or which interpretation or pronouncement is announced on or after , 1994, there is more than an insubstantial risk that interest payable to PacifiCorp Delaware on the Series A Junior Subordinated Debentures will not be deductible by PacifiCorp for federal income tax purposes (or PacifiCorp Delaware is subject to federal income tax with respect to interest received on the Series A Junior Subordinated Debentures or to more than a de minimis amount of other taxes, duties or other governmental charges), the General Partner would have the option, subject to receiving a favorable opinion of tax counsel, to dissolve PacifiCorp Delaware and cause the Series A Junior Subordinated Debentures to be distributed to the holders of the Series A Preferred Securities, as described under "Description of the Series A Preferred Securities-Tax Event Distribution." S-5 SELECTED FINANCIAL INFORMATION (Dollar amounts in millions, except per share amounts) The following selected financial information for each of the three years in the period ended December 31, 1993 and six months ended June 30, 1993 and 1994, has been derived from the consolidated financial statements of PacifiCorp for the respective periods. The consolidated financial statements for the three-year period ended December 31, 1993 have been audited by Deloitte & Touche LLP, independent auditors, and the reports of Deloitte & Touche LLP are incorporated in the accompanying Prospectus by reference. This selected financial information should be read in conjunction with the financial statements and related notes thereto included in the Incorporated Documents (as defined in the accompanying Prospectus).
TWELVE MONTHS ENDED SIX MONTHS DECEMBER 31, ENDED JUNE 30, _______________________ __________________ 1991 1992 1993 1993 1994 ____ ____ ____ ____ ____ Income Statement Data: Revenues $3,168 $3,242 $3,412 $1,668 $1,701 Income from Operations (1) 941 633 916 445 453 Income from Continuing Operations 447 150 423 204 210 Discontinued Operations (2) 60 (491) 52 -- -- Cumulative Effect on Prior Years of a Change in Accounting for Income Taxes -- -- 4 4 -- Net Income (Loss) 507 (341) 479 208 210 Preferred Stock Dividend Requirements 26 37 39 19 20 Earnings (Loss) on Common Stock 481 (378) 440 189 190 Earnings (Loss) per Common Share: Continuing Operations 1.63 .42 1.40 .68 .67 Discontinued Operations .23 (1.84) .19 -- -- Cumulative Effect on Prior Years of a Change in Accounting for Income Taxes -- -- .01 .01 -- JUNE 30, 1994 _____________________________________________ ACTUAL AS ADJUSTED(3) _______________________ ________________ AMOUNT % AMOUNT % ______ _____ ______ ____ Capital Structure: Long-Term Debt and Capital Lease Obligations $3,814 49% $3,814 49% Preferred Stock 367 5 367 5 Preferred Stock Subject to Mandatory Redemption 219 3 219 3 Common Equity 3,345 43 3,345 43 _____ ___ _____ ___ Total $7,745 100% $7,745 100% ===== === ===== === Short-Term Debt $ 528 Long-term Debt and Capital Lease Obligations Currently Maturing $ 164 $ 164 Minority Interest $ 104 $ ____________________ (1) Income before income taxes, interest, other nonoperating items, discontinued operations and cumulative effect of a change in an accounting principle. (2) Discontinued operations represents PacifiCorp's interests in NERCO, Inc. and an international communications subsidiary of Pacific Telecom. (3) Adjusted to give effect to the issuance and sale of the Series A Preferred Securities of PacifiCorp Delaware and the investment of the proceeds thereof in Series A Junior Subordinated Debentures of PacifiCorp. Such proceeds will ultimately be used by PacifiCorp to retire its short-term debt. See "Use of Proceeds." The above table sets forth the effects of consolidation of PacifiCorp and all of its consolidated subsidiaries, including PacifiCorp Delaware. The Series A Preferred Securities are recorded as minority interest.
USE OF PROCEEDS The proceeds from the sale of the Series A Preferred Securities will be invested in the Series A Junior Subordinated Debentures issued pursuant to the Indenture described herein, and ultimately will be used by PacifiCorp to repay its short-term borrowings and for the other corporate purposes. S-6 DESCRIPTION OF THE SERIES A PREFERRED SECURITIES GENERAL All of the partnership interests in PacifiCorp Delaware, other than the Series A Preferred Securities offered hereby, are owned directly or indirectly by PacifiCorp. The Limited Partnership Agreement authorizes and creates the Series A Preferred Securities, which represent limited partner interests in PacifiCorp Delaware (the "Preferred Securities"). Preferred Securities may be issued from time to time in one or more series as described in the accompanying Prospectus. The limited partner interests represented by the Series A Preferred Securities will have a preference with respect to dividends and amounts payable on liquidation over the General Partner's interest in PacifiCorp Delaware. The Limited Partnership Agreement does not permit the issuance of any Preferred Securities ranking, as to participation in profits and dividends and in the assets of PacifiCorp Delaware, senior or junior to the Series A Preferred Securities or the incurrence of any indebtedness by PacifiCorp Delaware. The summary of certain terms and provisions of the Series A Preferred Securities set forth below does not purport to be complete and is subject to, and qualified in its entirety by reference to, the Limited Partnership Agreement and the Partnership Act. DIVIDENDS The dividends payable on each Series A Preferred Security will be fixed at a rate per annum of % of the stated liquidation preference of $25 per Preferred Security. Accrued and unpaid dividends after the dividend payment date therefor will bear interest thereon at the rate per annum of % thereof. The term "dividends" as used herein includes any such interest payable unless otherwise stated. The amount of dividends payable for any period will be computed on the basis of a 360-day year of twelve 30-day months. Dividends on the Series A Preferred Securities will be cumulative, will accrue from , 1994 and will be payable monthly in arrears, on the last day of each calendar month of each year, commencing , 1994, when, as and if available and determined to be so payable by PacifiCorp, as the General Partner, except as otherwise described below. PacifiCorp has the right under the Indenture to extend the interest payment period from time to time on the Series A Junior Subordinated Debentures to a period not exceeding 60 consecutive months, and, as a consequence, monthly dividends on the Series A Preferred Securities would be deferred (but would continue to accrue with interest) by PacifiCorp Delaware during any such extended interest payment period. In the event that PacifiCorp exercises this right, PacifiCorp may not declare or pay dividends on, or redeem, purchase or acquire, any of its capital stock. Prior to the termination of any such extension period, PacifiCorp may further extend the interest payment period, provided that such extension period together with all such previous and further extensions thereof may not exceed 60 consecutive months. Upon the termination of any extension period and the payment of all amounts then due, PacifiCorp may select a new extension period, subject to the above requirements. See "Description of the Series A Junior Subordinated Debentures-Interest" and "-Option to Extend Interest Payment Period." Dividends on the Series A Preferred Securities must be paid on the dates payable to the extent that PacifiCorp Delaware has (i) funds legally available for the payment of such dividends and (ii) cash on hand sufficient to permit such payments. It is anticipated that PacifiCorp Delaware's earnings available for distribution to the holders of the Series A Preferred Securities will be limited to payments under the Series A Junior Subordinated Debentures in which PacifiCorp Delaware will invest the proceeds from the issuance and sale of the Series A Preferred Securities and the General Partner's capital contribution. See "Description of the Series A Junior Subordinated Debentures." The payment of dividends, out of moneys held by PacifiCorp Delaware, are guaranteed by PacifiCorp as set forth under "Description of the Guarantee" in the accompanying Prospectus. Dividends on the Series A Preferred Securities will be payable to the holders thereof as they appear on the books and records of PacifiCorp Delaware on the relevant record dates, which, as long as the Series A Preferred Securities remain in book-entry-only form, will be one Business Day (as defined below) prior to the relevant payment dates. Subject to any applicable laws and regulations and the provisions of the Limited Partnership Agreement, each such payment will be made as described under S-7 "Book-Entry-Only Issuance-The Depository Trust Company" below. In the event the Series A Preferred Securities shall not continue to remain in book-entry-only form, the General Partner shall have the right to select relevant record dates, which shall be more than one Business Day prior to the relevant payment dates. In the event that any date on which dividends are payable on the Series A Preferred Securities is not a Business Day, then payment of the dividend payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay) except that, if such Business Day is in the next succeeding calendar year, such payment shall be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such date. A "Business Day" shall mean any day other than a day on which banking institutions in The City of New York are authorized or required by law to close. CERTAIN RESTRICTIONS ON PACIFICORP DELAWARE If dividends have not been paid in full on the Series A Preferred Securities, PacifiCorp Delaware shall not: (i) pay, or set aside for payment, any dividends on any other series of Preferred Securities, unless the amount of any dividends declared on any other series of Preferred Securities is paid on such other series of Preferred Securities and the Series A Preferred Securities on a pro rata basis on the date such dividends are paid on such other series of Preferred Securities, so that (x) the aggregate amount of dividends paid on the Series A Preferred Securities bears to the aggregate amount of dividends paid on such other series of Preferred Securities the same ratio as (y) the aggregate of all accrued and unpaid dividends in respect of the Series A Preferred Securities bears to the aggregate of all accrued and unpaid dividends in respect of such other series of Preferred Securities; or (ii) redeem, purchase or otherwise acquire any other Preferred Securities; until, in each case, such time as all accrued and unpaid dividends on the Series A Preferred Securities shall have been paid in full for all dividend periods terminating on or prior to, in the case of clause (i), such payment and, in the case of clause (ii), the date of such redemption, purchase or acquisition. As of the date of this Prospectus Supplement, there are no series of Preferred Securities outstanding. OPTIONAL REDEMPTION The Series A Preferred Securities are redeemable, at the option of PacifiCorp Delaware, in whole or in part, from time to time, on or after , 1999, upon not less than 30 nor more than 60 days' notice, at the Redemption Price. In the event that fewer than all the outstanding Series A Preferred Securities are to be so redeemed, the Series A Preferred Securities to be redeemed will be selected as described under "Book-Entry-Only Issuance- The Depository Trust Company" below. If a partial redemption would result in the delisting of the Series A Preferred Securities, PacifiCorp Delaware may only redeem the Series A Preferred Securities in whole. If PacifiCorp Delaware redeems the Series A Preferred Securities in accordance with the terms thereof, the Series A Junior Subordinated Debentures will become due and payable in a principal amount equal to the aggregate stated liquidation preference of the Series A Preferred Securities so redeemed, together with any accrued and unpaid interest, including Additional Interest (as defined below), if any. TAX EVENT DISTRIBUTION If a Tax Event (as defined below) shall occur and be continuing, the General Partner shall dissolve PacifiCorp Delaware and, after satisfaction of liabilities of creditors as required by the Partnership Act, cause Series A Junior Subordinated Debentures having an aggregate principal amount and accrued and unpaid interest equal to the aggregate of the stated liquidation preference of, and accrued and unpaid dividends on, the Series A Preferred Securities to be distributed to the holders of the Series A Preferred S-8 Securities in liquidation of PacifiCorp Delaware, within 90 days following the occurrence of such Tax Event; provided, however, that, as a condition of such dissolution and distribution, PacifiCorp Delaware shall be required to obtain an opinion of counsel (which may be regular tax counsel to PacifiCorp or an affiliate, but not an employee thereof) to the effect that the holders of the Series A Preferred Securities will not recognize any gain or loss for federal income tax purposes as a result of such dissolution and distribution of Series A Junior Subordinated Debentures; and, provided further, that the General Partner may elect to cause the Series A Preferred Securities to remain outstanding. "Tax Event" means that the General Partner shall have obtained an opinion of nationally recognized independent tax counsel experienced in such matters to the effect that, as a result of (a) any amendment to, or change (including any announced prospective change) in, the laws (or any regulations thereunder) of the United States or any political subdivision or taxing authority thereof or therein, (b) any notice of proposed adjustment issued by the IRS to PacifiCorp or PacifiCorp Delaware, (c) any amendment to or change in an interpretation or application of such laws or regulations by any legislative body, court, governmental agency or regulatory authority (including the enactment of any legislation and the publication of any judicial decision or regulatory determination on or after such date) or (d) any interpretation or pronouncement that provides for a position with respect to such laws or regulations that differs from the generally accepted position on , 1994, which amendment or change is effective, which notice of proposed adjustment is issued or which interpretation or pronouncement is announced on or after , 1994, there is more than an insubstantial risk that (i) PacifiCorp Delaware is subject to federal income tax with respect to interest received on the Series A Junior Subordinated Debentures, (ii) interest payable to PacifiCorp Delaware on the Series A Junior Subordinated Debentures will not be deductible by PacifiCorp for federal income tax purposes or (iii) PacifiCorp Delaware will be subject to more than a de minimis amount of other taxes, duties or other governmental charges. After the date fixed for any distribution of Series A Junior Subordinated Debentures, upon dissolution of PacifiCorp Delaware, (i) the Series A Preferred Securities will no longer be deemed to be outstanding, (ii) The Depository Trust Company (the "Depository" or "DTC") or its nominee, as the record holder of the Series A Preferred Securities, will return the registered global certificate or certificates representing the Series A Preferred Securities and will receive a registered global certificate or certificates representing the Series A Junior Subordinated Debentures to be delivered upon such distribution and (iii) any certificates representing Series A Preferred Securities not held by DTC or its nominee will be deemed to represent Series A Junior Subordinated Debentures having an aggregate principal amount and accrued and unpaid interest equal to the aggregate of the stated liquidation preference of, and accrued and unpaid dividends on, such Series A Preferred Securities until such certificates are presented to PacifiCorp or its agent for transfer or reissuance. MANDATORY REDEMPTION Upon any redemption or repayment of the Series A Junior Subordinated Debentures at maturity or earlier, the proceeds from such redemption or repayment will be applied to redeem the Series A Preferred Securities, in whole or in part, upon not less than 30 nor more than 60 days' notice, at the Redemption Price. REDEMPTION PROCEDURES PacifiCorp Delaware may not redeem fewer than all the outstanding Series A Preferred Securities unless all accrued and unpaid dividends have been paid on all Series A Preferred Securities for all monthly dividend periods terminating on or prior to the date of redemption. If PacifiCorp Delaware gives a notice of redemption in respect of Series A Preferred Securities (which notice will be irrevocable), then, by 12:00 noon, New York time, on the redemption date, PacifiCorp Delaware will irrevocably deposit with DTC funds sufficient to pay the applicable Redemption Price and will give DTC irrevocable instructions and authority to pay the Redemption Price to the holders of the Series A Preferred Securities. See "Book-Entry-Only Issuance-The Depository Trust Company." If notice of redemption shall have been given and funds deposited as required, then upon the date of such deposit, all rights of holders of such Series A Preferred Securities so called for S-9 redemption will cease, except the right of the holders of such Series A Preferred Securities to receive the Redemption Price, but without interest on such Redemption Price. In the event that any date fixed for redemption of Series A Preferred Securities is not a Business Day, then payment of the Redemption Price payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay), except that, if such Business Day falls in the next calendar year, such payment will be made on the immediately preceding Business Day. In the event that payment of the Redemption Price in respect of Series A Preferred Securities is improperly withheld or refused and not paid either by PacifiCorp Delaware or by PacifiCorp pursuant to the Guarantee described under "Description of the Guarantee" in the accompanying Prospectus, dividends on such Series A Preferred Securities will continue to accrue at the then applicable rate, from the original redemption date to the date of payment, in which case the actual payment date will be considered the date fixed for redemption for purposes of calculating the Redemption Price. Subject to the foregoing and applicable law (including, without limitation, United States federal securities laws), PacifiCorp or its subsidiaries may at any time and from time to time purchase outstanding Series A Preferred Securities by tender, in the open market, or by private agreement. LIQUIDATION DISTRIBUTION UPON DISSOLUTION In the event of any voluntary or involuntary dissolution, winding-up or termination of PacifiCorp Delaware, the holders of the Series A Preferred Securities at the time will be entitled to receive out of the assets of PacifiCorp Delaware available for distribution to partners after satisfaction of liabilities of creditors as required by the Partnership Act, before any distribution of assets is made to the General Partner, but together with the holders of every other series of Preferred Securities outstanding, an amount equal to, in the case of holders of Series A Preferred Securities, the aggregate of the stated liquidation preference of $25 per Series A Preferred Security and accrued and unpaid dividends thereon to the date of payment (the "Liquidation Distribution"), unless, in connection with such dissolution, winding-up or termination, Series A Junior Subordinated Debentures in an aggregate principal amount and accrued and unpaid interest equal to the Liquidation Distribution have been distributed on a pro rata basis to the holders of the Series A Preferred Securities. If, upon any such dissolution, the Liquidation Distribution can be paid only in part because PacifiCorp Delaware has insufficient assets available to pay in full the aggregate Liquidation Distribution and the aggregate maximum liquidation distributions on any other series of Preferred Securities, then the amounts payable directly by PacifiCorp Delaware on the Series A Preferred Securities and on such other series of Preferred Securities shall be paid on a pro rata basis, so that (i) the aggregate amount paid in respect of the Liquidation Distribution bears to the aggregate amount paid as liquidation distributions on the other series of Preferred Securities the same ratio as (ii) the aggregate Liquidation Distribution bears to the aggregate maximum liquidation distributions on the other series of Preferred Securities. Pursuant to the Limited Partnership Agreement, PacifiCorp Delaware shall be dissolved and its affairs shall be wound up: (i) on December 31, 2039, the expiration of the term of PacifiCorp Delaware, subject to extension for an additional 40 years by the General Partner, (ii) upon the bankruptcy of the General Partner or the assignment by the General Partner of its entire interest in PacifiCorp Delaware when the assignee is not admitted to PacifiCorp Delaware as a general partner of PacifiCorp Delaware in accordance with the Limited Partnership Agreement, or the filing of a certificate of dissolution or its equivalent with respect to the General Partner, or the revocation of the General Partner's charter and the expiration of 90 days after the date of notice to the General Partner of revocation without a reinstatement of its charter, or any other event occurs which causes the General Partner to cease to be a general partner of PacifiCorp Delaware under the Partnership Act, unless the business of PacifiCorp Delaware is continued in accordance with the Partnership Act, (iii) in accordance with the provisions of the Series A Preferred Securities, (iv) upon the entry of a decree of a judicial dissolution or (v) upon the written consent of all partners of PacifiCorp Delaware. S-10 MERGER, CONSOLIDATION OR AMALGAMATION OF PACIFICORP DELAWARE PacifiCorp Delaware may not consolidate, amalgamate, merge with or into, or be replaced by, or convey, transfer or lease its properties and assets substantially as an entirety to any corporation or other body, except as described below. PacifiCorp Delaware may, without the consent of the holders of the Series A Preferred Securities, consolidate, amalgamate, merge with or into, or be replaced by a limited liability company, limited partnership or a trust organized as such under the laws of any state of the United States of America; provided, that (i) such successor entity either (x) expressly assumes all of the obligations of PacifiCorp Delaware under the Series A Preferred Securities or (y) substitutes for the Series A Preferred Securities other securities having substantially the same terms as the Series A Preferred Securities (the "Successor Securities") so long as the Successor Securities rank, with respect to participation in the profits and dividends or in the assets of the successor entity, at least as high as the Series A Preferred Securities rank with respect to participation in the profits and dividends or in the assets of PacifiCorp Delaware, (ii) PacifiCorp expressly acknowledges such successor entity as the holder of the Series A Junior Subordinated Debentures, (iii) the Series A Preferred Securities or any Successor Securities are listed, or any Successor Securities will be listed upon notification of issuance, on any national securities exchange or other organization on which the Series A Preferred Securities are then listed, (iv) such merger, consolidation, amalgamation or replacement does not cause the Series A Preferred Securities (including any Successor Securities) to be downgraded by any nationally recognized statistical rating organization, (v) such merger, consolidation, amalgamation or replacement does not adversely affect the powers, preferences and other special rights of the holders of the Series A Preferred Securities (including any Successor Securities) in any material respect, (vi) such successor entity has a purpose substantially identical to that of PacifiCorp Delaware and (vii) prior to such merger, consolidation, amalgamation or replacement, PacifiCorp has received an opinion of nationally recognized independent counsel to PacifiCorp Delaware experienced in such matters to the effect that (x) such successor entity will be treated as a partnership for federal income tax purposes, (y) following such merger, consolidation, amalgamation or replacement, PacifiCorp and such successor entity will be in compliance with the Investment Company Act of 1940, as amended ("1940 Act") without registering thereunder as an investment company and (z) such merger, consolidation, amalgamation or replacement will not adversely affect the limited liability of the holders of the Series A Preferred Securities. ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF SERIES A PREFERRED SECURITIES Under the terms of the Series A Preferred Securities, the holders of outstanding Series A Preferred Securities will have the rights referred to under "---Voting Rights" below, including the right to appoint a Special Representative, which Special Representative shall be authorized to enforce PacifiCorp Delaware's creditor rights under the Series A Junior Subordinated Debentures and to enforce the rights of holders of Series A Preferred Securities under the Guarantee. VOTING RIGHTS Except as provided below and under "Description of the Guarantee- Amendments and Assignment" in the accompanying Prospectus and as otherwise required by law and the Limited Partnership Agreement, the holders of the Series A Preferred Securities will have no voting rights. If (i) PacifiCorp Delaware fails to pay dividends in full on the Series A Preferred Securities for 18 consecutive monthly dividend periods; (ii) an Event of Default (as defined in the Indenture) occurs and is continuing on the Series A Junior Subordinated Debentures; or (iii) PacifiCorp is in default on any of its payment or other obligations under the Guarantee (as described under "Description of the Guarantee--Certain Covenants of PacifiCorp" in the accompanying Prospectus), then the holders of the Series A Preferred Securities, together with the holders of any other series of Preferred Securities having the right to vote for the appointment of a special representative of PacifiCorp Delaware and the limited partners (a "Special Representative") in such event, acting as a single class, will be entitled by the majority vote of such holders to appoint and authorize a Special Representative to enforce PacifiCorp Delaware's creditor rights under the Series A Junior Subordinated Debentures, to enforce the rights of the holders of the Series A Preferred Securities under the Guarantee and to enforce the rights of the holders of the Series A Preferred Securities to receive dividends on the Series A Preferred Securities. The Special Representative shall not by virtue of acting in such capacity be admitted as a general partner in PacifiCorp Delaware or otherwise be deemed to be a general partner S-11 in PacifiCorp Delaware and shall have no liability for the debts, obligations or liabilities of PacifiCorp Delaware. For purposes of determining whether PacifiCorp Delaware has failed to pay dividends in full for 18 consecutive monthly dividend periods, dividends shall be deemed to remain in arrears, notwithstanding any payments in respect thereof, until full cumulative dividends have been or contemporaneously are paid with respect to all monthly dividend periods terminating on or prior to the date of payment of such full cumulative dividends. Not later than 30 days after such right to appoint a Special Representative arises, the General Partner will convene a meeting for the purpose of appointing a Special Representative. If the General Partner fails to convene such meeting within such 30-day period, the holders of 10% in liquidation preference of the outstanding Preferred Securities will be entitled to convene such meeting. The provisions of the Limited Partnership Agreement relating to the convening and conduct of the meetings of the partners will apply with respect to any such meeting. Any Special Representative so appointed shall cease to be a Special Representative of PacifiCorp Delaware and the limited partners if PacifiCorp Delaware (or PacifiCorp pursuant to the Guarantee) shall have paid in full all accrued and unpaid dividends on the Preferred Securities or such default or breach, as the case may be, shall have been cured, and PacifiCorp, in its capacity as the General Partner shall continue the business of PacifiCorp Delaware without dissolution. Notwithstanding the appointment of any such Special Representative, PacifiCorp shall continue as General Partner and shall retain all rights under the Indenture, including the right to extend the interest payment period as provided under "Description of the Series A Junior Subordinated Debentures-Option to Extend Interest Payment Period." If any proposed amendment to the Limited Partnership Agreement provides for, or the General Partner otherwise proposes to effect, (i) any action which would adversely affect the powers, preferences or special rights of the Series A Preferred Securities, whether by way of amendment to the Limited Partnership Agreement or otherwise (including, without limitation, the authorization or issuance of any limited partner interests in PacifiCorp Delaware ranking, as to participation in the profits and dividends or in the assets of PacifiCorp Delaware, senior to the Series A Preferred Securities), or (ii) the dissolution, winding-up or termination of PacifiCorp Delaware, other than (x) in connection with the distribution of Series A Junior Subordinated Debentures upon the occurrence of a Tax Event or (y) as described under "Merger, Consolidation or Amalgamation of PacifiCorp Delaware" above, then the holders of outstanding Series A Preferred Securities will be entitled to vote on such amendment or proposal of the General Partner (but not on any other amendment or proposal) as a class with all other holders of series of Preferred Securities similarly affected, and such amendment or proposal shall not be effective except with the approval of the holders of 66-2/3% in liquidation preference of such outstanding Preferred Securities having a right to vote on the matter; provided, however, that no such approval shall be required if the dissolution, winding-up or termination of PacifiCorp Delaware is proposed or initiated upon the initiation of proceedings, or after proceedings have been initiated, for the dissolution, winding-up, liquidation or termination of PacifiCorp. The rights attached to the Series A Preferred Securities will be deemed not to be adversely affected by the creation or issue of, and no vote will be required for the creation of, any further limited partner interests of PacifiCorp Delaware ranking pari passu with the Series A Preferred Securities with regard to participation in the profits and dividends or in the assets of PacifiCorp Delaware. Holders of Series A Preferred Securities have no preemptive rights. So long as any Series A Junior Subordinated Debentures are held by PacifiCorp Delaware, the General Partner shall not (i) direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or executing any trust or power conferred on the Trustee with respect to such series, (ii) waive any past default which is waivable under Section 6.06 of the Indenture, (iii) exercise any right to rescind or annul a declaration that the principal of all the Series A Junior Subordinated Debentures shall be due and payable or (iv) consent to any amendment, modification or termination of the Indenture, where such consent shall be required, without, in each case, obtaining the prior approval of the holders of at least 66-2/3% in liquidation preference of all series of Preferred Securities affected thereby, acting as a single class; provided, however, that where a consent under the Indenture would require the consent of each holder affected thereby, no such consent shall be given by the General Partner without the prior consent of each holder of all series of Preferred Securities affected thereby. The General Partner shall not revoke any action previously authorized or approved by a vote of any series of Preferred Securities. The General Partner shall notify all holders of the Series A S-12 Preferred Securities of any notice of default received from the Trustee with respect to the Series A Junior Subordinated Debentures. Any required approval of holders of Series A Preferred Securities may be given at a separate meeting of holders of Preferred Securities convened for such purpose, at a meeting of all of the partners in PacifiCorp Delaware or pursuant to written consent. PacifiCorp Delaware will cause a notice of any meeting at which holders of Series A Preferred Securities are entitled to vote, or of any matter upon which action by written consent of such holders is to be taken, to be mailed to each holder of record of Series A Preferred Securities. Each such notice will include a statement setting forth (i) the date of such meeting or the date by which such action is to be taken, (ii) a description of any resolution proposed for adoption at such meeting on which such holders are entitled to vote or of such matter upon which written consent is sought and (iii) instructions for the delivery of proxies or consents. No vote or consent of the holders of Series A Preferred Securities will be required for PacifiCorp Delaware to redeem and cancel Series A Preferred Securities in accordance with the Limited Partnership Agreement. Notwithstanding that holders of Series A Preferred Securities are entitled to vote or consent under any of the circumstances described above, any of the Series A Preferred Securities and any other series of Preferred Securities that are entitled to vote or consent with such Series A Preferred Securities as a single class at such time that are owned by PacifiCorp or any entity owned more than 50% by PacifiCorp, either directly or indirectly, shall not be entitled to vote or consent and shall, for purposes of such vote or consent, be treated as if they were not outstanding. Holders of the Series A Preferred Securities will have no rights to remove or replace the General Partner. BOOK-ENTRY-ONLY ISSUANCE-THE DEPOSITORY TRUST COMPANY DTC will act as securities depository for the Series A Preferred Securities. The Series A Preferred Securities will be issued only as fully-registered securities registered in the name of Cede & Co. (DTC's nominee). One or more fully-registered global Series A Preferred Security certificates will be issued, representing in the aggregate the total number of Series A Preferred Securities, and will be deposited with DTC. 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 17A of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). DTC holds securities that its participants ("Participants") deposit with DTC. DTC also facilitates the settlement among Participants of securities transactions, such as transfers and pledges, in deposited securities through electronic computerized book-entry changes in Participants' accounts, thereby eliminating the need for physical movement of securities certificates. Direct Participants include securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations ("Direct Participants"). DTC is owned by a number of its Direct Participants and by the New York Stock Exchange, Inc. (the "New York Stock Exchange"), the American Stock Exchange, Inc., and the National Association of Securities Dealers, Inc. Access to the DTC system is also available to others such as securities brokers and dealers, banks and trust companies that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ("Indirect Participants"). The rules applicable to DTC and its Participants are on file with the Securities and Exchange Commission. Purchases of Series A Preferred Securities within the DTC system must be made by or through Direct Participants, which will receive a credit for the Series A Preferred Securities on DTC's records. The ownership interest of each actual purchaser of each Series A Preferred Security ("Beneficial Owner") 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 S-13 holdings, from the Direct or Indirect Participants through which the Beneficial Owners purchased Series A Preferred Securities. Transfers of ownership interests in the Series A Preferred Securities 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 Series A Preferred Securities, except in the event that use of the book-entry system for the Series A Preferred Securities is discontinued. DTC has no knowledge of the actual Beneficial Owners of the Series A Preferred Securities; DTC's records reflect only the identity of the Direct Participants to whose accounts such Series A Preferred Securities are credited, which may or may not be the Beneficial Owners. The Participants will 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 will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Redemption notices shall be sent to Cede & Co. If less than all of the Series A Preferred Securities are being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such series to be redeemed. Although voting with respect to the Series A Preferred Securities is limited, in those cases where a vote is required, neither DTC nor Cede & Co. will itself consent or vote with respect to Series A Preferred Securities. Under its usual procedures, DTC would mail an Omnibus Proxy to PacifiCorp Delaware as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts the Series A Preferred Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy). Dividend payments on the Series A Preferred Securities will be made to DTC. DTC's practice is to credit Direct Participants' accounts on the relevant payment date in accordance with their respective holdings shown on DTC's records unless DTC has reason to believe that it will not receive payments on such payment date. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices and will be the responsibility of such Participant and not of DTC, PacifiCorp Delaware or PacifiCorp, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of dividends to DTC is the responsibility of PacifiCorp Delaware, disbursement of such payments to Direct Participants is the responsibility of DTC, and disbursement of such payments to the Beneficial Owners is the responsibility of Direct and Indirect Participants. DTC may discontinue providing its services as securities depository with respect to the Series A Preferred Securities at any time by giving reasonable notice to PacifiCorp Delaware. Under such circumstances, in the event that a successor securities depository is not obtained, Series A Preferred Security certificates are required to be printed and delivered. Additionally, PacifiCorp Delaware (with the consent of PacifiCorp) may decide to discontinue use of the system of book-entry transfers through DTC (or a successor depository). In that event, certificates for the Series A Preferred Securities will be printed and delivered. In each of the above circumstances, the General Partner will appoint a paying agent with respect to the Series A Preferred Securities. The information in this section concerning DTC and DTC's book-entry system has been obtained from sources that PacifiCorp Delaware and PacifiCorp believe to be reliable, but PacifiCorp Delaware and PacifiCorp take no responsibility for the accuracy thereof. REGISTRAR AND TRANSFER AGENT PacifiCorp will act as registrar and transfer agent for the Series A Preferred Securities. Registration of transfers of Series A Preferred Securities will be effected without charge by or on behalf of PacifiCorp Delaware, but upon payment (with the giving of such indemnity as PacifiCorp S-14 Delaware or PacifiCorp may require) in respect of any tax or other government charges which may be imposed in relation to it. PacifiCorp Delaware will not be required to register or cause to be registered the transfer of Series A Preferred Securities after such Series A Preferred Securities have been called for redemption. MISCELLANEOUS The General Partner is authorized and directed to conduct its affairs and to operate PacifiCorp Delaware in such a way that PacifiCorp Delaware will not be deemed to be an "investment company" required to be registered under the 1940 Act or taxed as a corporation for federal income tax purposes and so that the Series A Junior Subordinated Debentures will be treated as indebtedness of PacifiCorp for federal income tax purposes. In this connection, the General Partner is authorized to take any action, not inconsistent with applicable law, the certificate of limited partnership or the Limited Partnership Agreement, that the General Partner determines in its discretion to be necessary or desirable for such purposes, as long as such action does not adversely affect the interests of the holders of the Series A Preferred Securities. S-15 DESCRIPTION OF THE SERIES A JUNIOR SUBORDINATED DEBENTURES Set forth below is a description of the specific terms of the Series A Junior Subordinated Debentures in which PacifiCorp Delaware will invest the proceeds of the issuance and sale of (i) the Series A Preferred Securities and (ii) the General Partner's capital contribution with respect to the Series A Preferred Securities (the "General Partnership Payment"). This description supplements the description of the general terms and provisions of the Junior Subordinated Debentures set forth in the accompanying Prospectus under the caption "Description of the Junior Subordinated Debentures." The following description does not purport to be complete and is qualified in its entirety by reference to the description in the accompanying Prospectus and the Indenture, dated as of , 1994, between PacifiCorp and The Bank of New York, as Trustee, as supplemented by a First Supplemental Indenture, dated as of , 1994 (such Indenture, as so supplemented, is hereinafter referred to as the "Indenture"'). Under certain circumstances involving the dissolution of PacifiCorp Delaware following the occurrence of a Tax Event, Series A Junior Subordinated Debentures may be distributed to the holders of the Series A Preferred Securities in liquidation of PacifiCorp Delaware. See "Description of the Series A Preferred Securities-Tax Event Distribution." GENERAL The Series A Junior Subordinated Debentures will be issued as a series of unsecured Junior Subordinated Debentures under the Indenture. The Series A Junior Subordinated Debentures will be limited in aggregate principal amount to approximately $ million, such amount being the sum of the aggregate stated liquidation preference of the Series A Preferred Securities and the General Partnership Payment. The entire principal amount of the Series A Junior Subordinated Debentures will become due and payable, together with any accrued and unpaid interest thereon, including Additional Interest (as hereinafter defined), if any, on , 2034. The Series A Junior Subordinated Debentures, if distributed to holders of Series A Preferred Securities in dissolution, will initially be so issued as a Global Security (as defined below). As described herein, under certain limited circumstances Series A Junior Subordinated Debentures may be issued in certificated form in exchange for a Global Security (as defined below). See "-Book-Entry and Settlement." In the event that Series A Junior Subordinated Debentures are issued in certificated form, such Series A Junior Subordinated Debentures will be in denominations of $25 and integral multiples thereof and may be transferred or exchanged at the offices described below. Payments on Series A Junior Subordinated Debentures issued as a Global Security will be made to DTC, as the depository for the Series A Junior Subordinated Debentures. In the event Series A Junior Subordinated Debentures are issued in certificated form, principal and interest will be payable, the transfer of the Series A Junior Subordinated Debentures will be registerable and Series A Junior Subordinated Debentures will be exchangeable for Series A Junior Subordinated Debentures of other denominations of a like aggregate principal amount at the corporate trust office of the Trustee in The City of New York; provided, that payment of interest may be made at the option of PacifiCorp by check mailed to the address of the persons entitled thereto. If the Series A Junior Subordinated Debentures are distributed to the holders of Series A Preferred Securities upon the dissolution of PacifiCorp Delaware, PacifiCorp will use its best efforts to list the Series A Junior Subordinated Debentures on the New York Stock Exchange or on such other exchange as the Series A Preferred Securities are then listed and traded on the same part of any such exchange. MANDATORY PREPAYMENT If PacifiCorp Delaware redeems Series A Preferred Securities in accordance with the terms thereof, the Series A Junior Subordinated Debentures will become due and payable in a principal amount equal to the aggregate stated liquidation preference of the Series A Preferred Securities so redeemed, together S-16 with any accrued and unpaid interest, including Additional Interest (as defined below), if any. Any payment pursuant to this provision shall be made prior to 12:00 noon, New York time, on the date of such redemption or at such other time on such earlier date as the parties thereto shall agree. OPTIONAL REDEMPTION PacifiCorp shall have the right to redeem the Series A Junior Subordinated Debentures, in whole or in part, from time to time, on or after , 1999, upon not less than 30 nor more than 60 days' notice, at a redemption price equal to 100% of the principal amount to be redeemed plus any accrued and unpaid interest, including Additional Interest, if any, to the redemption date. Upon any redemption of the Series A Junior Subordinated Debentures, the proceeds from such redemption will be applied to redeem the Series A Preferred Securities, in whole or in part, upon not less than 30 nor more than 60 days' notice, at the Redemption Price. INTEREST Each Series A Junior Subordinated Debenture will bear interest at the rate of % per annum from the original date of issuance, payable monthly in arrears on the last day of each calendar month of each year (each, an "Interest Payment Date"), commencing , 1994, to the person in whose name such Series A Junior Subordinated Debenture is registered, subject to certain exceptions, at the close of business on the Business Day next preceding such Interest Payment Date. In the event the Series A Junior Subordinated Debentures shall not continue to remain in book-entry-only form, PacifiCorp shall have the right to select record dates which shall be more than one Business Day prior to the Interest Payment Date. The amount of interest payable for any period will be computed on the basis of a 360-day year of twelve 30-day months. In the event that any date on which interest is payable on the Series A Junior Subordinated Debentures is not a Business Day, then payment of the interest payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay), except that, if such Business Day is in the next succeeding calendar year, such payment shall be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such date. A "Business Day" shall mean any day other than a day on which banking institutions in The City of New York are authorized or required by law to close. OPTION TO EXTEND INTEREST PAYMENT PERIOD PacifiCorp shall have the right at any time during the term of the Series A Junior Subordinated Debentures to extend the interest payment period from time to time to a period not exceeding 60 consecutive months (the "Extension Period"), at the end of which Extension Period PacifiCorp shall pay all interest then accrued and unpaid (together with interest thereon at the rate specified for the Series A Junior Subordinated Debentures to the extent permitted by applicable law); provided, that, during any such Extension Period, PacifiCorp shall not declare or pay any dividends on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of its capital stock. Prior to the termination of any such Extension Period, PacifiCorp may further extend the interest payment period, provided that such Extension Period together with all such previous and further extensions thereof may not exceed 60 consecutive months. Upon the termination of any Extension Period and the payment of all amounts then due, PacifiCorp may select a new Extension Period, subject to the above requirements. No interest during an Extension Period, except at the end thereof, shall be due and payable. If PacifiCorp Delaware shall be the sole holder of the Series A Junior Subordinated Debentures, PacifiCorp shall give PacifiCorp Delaware notice of its selection of such Extension Period one Business Day prior to the earlier of (i) the date the dividends on the Series A Preferred Securities are payable or (ii) the date PacifiCorp Delaware is required to give notice to the New York Stock Exchange or other applicable self-regulatory organization or to holders of the Series A Preferred Securities of the record date or the date such dividend is payable, but in any event not less than one Business Day prior to such record date. PacifiCorp shall cause PacifiCorp Delaware to give notice of PacifiCorp's selection of such Extension Period to the holders of the Series A Preferred Securities. If PacifiCorp Delaware shall not be the sole holder of the Series A Junior Subordinated Debentures, PacifiCorp shall give the holders of the Series A Junior Subordinated Debentures notice of its selection of such Extension Period ten Business Days prior S-17 to the earlier of (i) the Interest Payment Date or (ii) the date PacifiCorp is required to give notice to the New York Stock Exchange or other applicable self-regulatory organization or to holders of the Series A Junior Subordinated Debentures, of the record or payment date of such related interest payment but in any event not less than three Business Days prior to such record date. ADDITIONAL INTEREST If at any time PacifiCorp Delaware shall be required to pay any interest on dividends in arrears in respect of the Series A Preferred Securities pursuant to the terms thereof, then PacifiCorp will pay as interest to PacifiCorp Delaware as the holder of the Series A Junior Subordinated Debentures ("Additional Interest") an amount equal to such interest on dividends in arrears. In addition, if PacifiCorp Delaware would be required to pay any taxes, duties, assessments or governmental charges of whatever nature (other than withholding taxes) imposed by the United States, or any other taxing authority, then, in any such case, PacifiCorp also will pay as Additional Interest such amounts as shall be required so that the net amounts received and retained by PacifiCorp Delaware after paying any such taxes, duties, assessments or governmental charges will be not less than the amounts PacifiCorp Delaware would have received had no such taxes, duties, assessments or governmental charges been imposed. SET-OFF Notwithstanding anything to the contrary in the Indenture, PacifiCorp shall have the right to set-off any payment it is otherwise required to make thereunder with and to the extent PacifiCorp has theretofore made, or is concurrently on the date of such payment making, a payment under the Guarantee. EVENTS OF DEFAULT In case any Event of Default (as defined in the Indenture) shall occur and be continuing, PacifiCorp Delaware will have the right to declare the principal of and the interest on the Series A Junior Subordinated Debentures (including any Additional Interest) and any other amounts payable under the Indenture to be forthwith due and payable and to enforce its other rights as a creditor with respect to the Series A Junior Subordinated Debentures. ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF SERIES A PREFERRED SECURITIES Under the terms of the Series A Preferred Securities, the holders of outstanding Series A Preferred Securities will have the rights referred to under "Description of the Series A Preferred Securities--Voting Rights," including the right to appoint a Special Representative, which Special Representative shall be authorized to exercise PacifiCorp Delaware's right to accelerate the principal amount of the Series A Junior Subordinated Debentures if any Event of Default shall occur and be continuing, to enforce PacifiCorp Delaware's other creditor rights under the Series A Junior Subordinated Debentures and to enforce the rights of holders of Series A Preferred Securities under the Guarantee. BOOK-ENTRY AND SETTLEMENT If distributed to holders of Series A Preferred Securities in connection with the dissolution of PacifiCorp Delaware as a result of the occurrence of a Tax Event, the Series A Junior Subordinated Debentures will be issued in the form of one or more global certificates (each, a "Global Security") registered in the name of the nominee of DTC. Except under the limited circumstances described below, Series A Junior Subordinated Debentures represented by the Global Security will not be exchangeable for, and will not otherwise be issuable as, Series A Junior Subordinated Debentures in definitive form. S-18 The Global Securities described above may not be transferred except by DTC to a nominee of DTC or by a nominee of DTC to DTC or another nominee of DTC or to a successor depository or its nominee. The laws of some jurisdictions require that certain purchasers of securities take physical delivery of such securities in definitive form. Such laws may impair the ability to transfer beneficial interests in such a Global Security. Except as provided below, owners of beneficial interests in such a Global Security will not be entitled to receive physical delivery of Series A Junior Subordinated Debentures in definitive form and will not be considered the Holders (as defined in the Indenture) thereof for any purpose under the Indenture, and no Global Security representing Series A Junior Subordinated Debentures shall be exchangeable, except for another Global Security of like denomination and tenor to be registered in the name of DTC or its nominee or to a successor depository or its nominee. Accordingly, each beneficial owner must rely on the procedures of DTC and, if such person is not a Participant, on the procedures of the Participant through which such person owns its interest, to exercise any rights of a Holder under the Indenture. THE DEPOSITORY. DTC will act as security depository for the Series A Junior Subordinated Debentures. For a description of DTC and the specific terms of the depository arrangements, see "Description of the Series A Preferred Securities-Book-Entry-Only Issuance-The Depository Trust Company." As of the date of this Prospectus Supplement, the description therein of DTC's book-entry system and DTC's practices as they relate to purchases, transfers, notices and payments with respect to the Series A Preferred Securities apply in all material respects to any debt obligations represented by one or more Global Securities held by DTC. Neither PacifiCorp, the Trustee, any paying agent nor any other agent of PacifiCorp or the Trustee will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests in a Global Security for such Series A Junior Subordinated Debentures or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests. DISCONTINUANCE OF THE DEPOSITORY'S SERVICES. A Global Security shall be exchangeable for Series A Junior Subordinated Debentures registered in the names of persons other than DTC or its nominee only if (i) DTC notifies PacifiCorp that it is unwilling or unable to continue as a depository for such Global Security and no successor depository shall have been appointed, or if any time DTC ceases to be a clearing agency registered under the Exchange Act at a time when DTC is required to be so registered to act as such depository, (ii) PacifiCorp in its sole discretion determines that such Global Security shall be so exchangeable or (iii) there shall have occurred an Event of Default with respect to such Series A Junior Subordinated Debentures. Any Global Security that is exchangeable pursuant to the preceding sentence shall be exchangeable for Series A Junior Subordinated Debentures registered in such names as the Depository shall direct. It is expected that such instructions will be based upon directions received by the Depository from its Participants with respect to ownership of beneficial interests in such Global Security. MISCELLANEOUS For restrictions on certain actions of the General Partner with respect to Series A Junior Subordinated Debentures held by PacifiCorp Delaware, see "Description of the Series A Preferred Securities-Voting Rights." S-19 UNITED STATES TAXATION GENERAL This section is a summary of certain United States federal income tax considerations that may be relevant to prospective purchasers of Series A Preferred Securities and represents the opinion of Stoel Rives Boley Jones & Grey, counsel to PacifiCorp and PacifiCorp Delaware, insofar as it relates to matters of law and legal conclusions. This section is based upon current provisions of the Internal Revenue Code of 1986, as amended (the "Code"), existing and proposed regulations thereunder and current administrative rulings and court decisions, all of which are subject to change. Subsequent changes may cause tax consequences to vary substantially from the consequences described below. No attempt has been made in the following discussion to comment on all United States federal income tax matters affecting purchasers of Series A Preferred Securities. Moreover, the discussion focuses on holders of Series A Preferred Securities who are individual citizens or residents of the United States that hold the Series A Preferred Securities as a capital asset and has only limited application to corporations, estates, trusts or non-resident aliens. Accordingly, each prospective purchaser of Series A Preferred Securities should consult, and should depend on, his or her own tax advisor in analyzing the federal, state, local and foreign tax consequences of the purchase, ownership or disposition of Series A Preferred Securities. INCOME FROM SERIES A PREFERRED SECURITIES In the opinion of Stoel Rives Boley Jones & Grey, PacifiCorp Delaware will be a partnership for federal income tax purposes. Accordingly, each holder of Series A Preferred Securities will be required to include in gross income such holder's distributive share of the net income of PacifiCorp Delaware. Such income will not exceed the dividends received on such Series A Preferred Securities, except in limited circumstances as described below under "Potential Extension of Interest Payment Period." No portion of such income will be eligible for the dividends received deduction. DISPOSITION OF SERIES A PREFERRED SECURITIES Gain or loss will be recognized on a sale, exchange or other disposition of Series A Preferred Securities, including a redemption for cash, equal to the difference between the amount realized and the holder's tax basis for the Series A Preferred Securities sold. Gain or loss recognized by a holder on the sale or exchange of a Series A Preferred Security held for more than one year will generally be taxable as long-term capital gain or loss. RECEIPT OF SERIES A JUNIOR SUBORDINATED DEBENTURES UPON LIQUIDATION OF PACIFICORP DELAWARE Under certain circumstances, as described under the caption "Description of the Series A Preferred Securities-Tax Event Distribution", Series A Junior Subordinated Debentures may be distributed to the holders of the Series A Preferred Securities in liquidation of PacifiCorp Delaware. Under current United States federal income tax law, such a distribution would be treated as a non-taxable exchange to each holder of Series A Preferred Securities and would result in the holder of Series A Preferred Securities receiving an aggregate tax basis in the Series A Junior Subordinated Debentures equal to such holder's aggregate tax basis in its Series A Preferred Securities. A holder's holding period in the Series A Junior Subordinated Debentures so received in liquidation of PacifiCorp Delaware would include the period for which the Series A Preferred Securities were held by such holder. As a condition to the dissolution of PacifiCorp Delaware and such a distribution, PacifiCorp Delaware will be required to obtain an opinion of counsel (which may be regular tax counsel to PacifiCorp or an affiliate, but not an employee thereof) to the effect that the holders of the Series A Preferred Securities will not recognize any gain or loss for federal income tax purposes as a result of such dissolution and distribution of Series A Junior Subordinated Debentures. S-20 PACIFICORP DELAWARE INFORMATION RETURNS AND AUDIT PROCEDURES PacifiCorp, as the General Partner of PacifiCorp Delaware, will furnish each holder of Series A Preferred Securities with a Schedule K-1 each year setting forth such holder's allocable share of income for the prior calendar year. PacifiCorp is required to furnish such Schedule K-1 as soon as practicable following the end of the year, but in any event prior to March 31. Any person who holds Series A Preferred Securities as a nominee for another person is required to furnish to PacifiCorp Delaware (a) the name, address and taxpayer identification number of the Beneficial Owner and the nominee; (b) information as to whether the Beneficial Owner is (i) a person that is not a United States person, (ii) a foreign government, an international organization or any wholly-owned agency or instrumentality of either of the foregoing, or (iii) a tax-exempt entity; (c) the amount and description of Series A Preferred Securities held, acquired or transferred for the Beneficial Owner; and (d) certain information including the dates of acquisitions and transfers, means of acquisitions and transfers, and acquisition cost for purchases, as well as the amount of net proceeds from sales. Brokers and financial institutions are required to furnish additional information, including whether they are United States persons and certain information on Series A Preferred Securities they acquire, hold or transfer for their own accounts. A penalty of $50 per failure (up to a maximum of $100,000 per calendar year) is imposed by the Code for failure to report such information to PacifiCorp Delaware. The nominee is required to supply the Beneficial Owners of the Series A Preferred Securities with the information furnished to PacifiCorp Delaware. POTENTIAL EXTENSION OF INTEREST PAYMENT PERIOD Under the Indenture, PacifiCorp has the right to extend from time to time the interest payment period on the Series A Junior Subordinated Debentures to a period not exceeding 60 consecutive months. Because the interest payment period is extendable by PacifiCorp, the interest on the Series A Junior Subordinated Debentures will be treated as "original issue discount" pursuant to Code sections 1271 et seq. and the Treasury Regulations promulgated _______ thereunder. PacifiCorp Delaware will therefore be required, during any Extension Period, to include in gross income the interest on the Series A Junior Subordinated Debentures as it accrues in accordance with a constant yield method (notwithstanding that no cash payments will be made during an Extension Period). Likewise, regardless of its regular method of accounting for tax purposes, each holder of Series A Junior Subordinated Debentures (after a dissolution of PacifiCorp Delaware) will be required, during any Extension Period, to include in income the interest on the Series A Junior Subordinated Debentures as it accrues in accordance with such method. Accrued income of PacifiCorp Delaware will be allocated, but not distributed, to holders of record on the Business Day preceding the last day of each calendar month. As a result, holders of record during an Extension Period or any other nonpayment period will include interest in gross income in advance of the receipt of cash, and any such holders who dispose of Series A Preferred Securities prior to the record date for the payment of dividends following such Extension Period or other nonpayment period will include interest in gross income but will not receive any cash related thereto from PacifiCorp Delaware. A holder's tax basis in a Series A Preferred Security will be increased by the amount of any interest that is included in income without the receipt of cash, and will be decreased again when and if such cash is subsequently received from PacifiCorp Delaware. UNITED STATES ALIEN HOLDERS For purposes of the following discussion, a "United States Alien Holder" is any holder that is (i) a nonresident alien individual, (ii) a foreign corporation or partnership or (iii) an estate or trust that has a foreign fiduciary, in each case not subject to United States federal income tax on a net income basis in respect of a Series A Preferred Security. Under current United States federal income tax law, subject to the discussion below with respect to backup withholding: (i) Payments by PacifiCorp Delaware or any of its paying agents in respect of a Series A Preferred Security to a United States Alien Holder will not be subject to United States federal withholding tax provided that (a) the Beneficial Owner of the Series A Preferred Security does not S-21 actually or constructively own 10% or more of the total combined voting power of all classes of capital stock of PacifiCorp entitled to vote, (b) the Beneficial Owner of the Series A Preferred Security is not a controlled foreign corporation that is related to PacifiCorp through stock ownership and (c) the Beneficial Owner provides the correct certification of United States Alien Holder status (which may generally be satisfied by providing an IRS Form W-8 certifying that the Beneficial Owner is a United States Alien Holder and providing the name and address of the Beneficial Owner); and (ii) A United States Alien Holder will not be subject to United States federal withholding tax and generally will not be subject to United States federal income tax on gain realized from the sale or exchange of a Series A Preferred Security. Under certain conditions, a United States Alien Holder may be subject to United States federal income tax on gain or income received with respect to the sale or exchange of a Series A Preferred Security. Such income taxation may occur, for example, if the United States Alien Holder (a) is engaged in a trade or business in the United States and gain or income is effectively connected with the conduct of that trade or business or (b) is an individual present in the United States for 183 days or more during the taxable year, and certain other conditions are met. Such taxation is beyond the scope of this summary and should be discussed with a tax advisor. If income is effectively connected with the conduct of a trade or business in the United States by a United States Alien Holder, withholding of United States federal income tax may be required unless the United States Alien Holder files with PacifiCorp Delaware or its paying agent an IRS form to the effect that the income is so effectively connected. If the Series A Junior Subordinated Debentures were not treated as debt, or if Pacificorp Delaware were not treated as a partnership, for United States federal income tax purposes, United States Alien Holders could experience tax consequences different from those currently anticipated, including consequences related to withholding on payment and United States estate tax consequences. BACKUP WITHHOLDING AND INFORMATION REPORTING In general, information reporting requirements will apply to payments to noncorporate United States holders of the proceeds of the sale of Series A Preferred Securities within the United States and "backup withholding" at a rate of 31% will apply to such payments if the United States holder fails to provide an accurate taxpayer identification number. In general, information reporting requirements will also apply to payments of principal and interest on a Series A Junior Subordinated Debenture distributed to a holder of Series A Preferred Securities, and the proceeds of the sale of a Series A Junior Subordinated Debenture prior to maturity within the United States, with respect to non-corporate United States Holders, and "backup withholding" at a rate of 31% will apply to such payments if the United States Holder fails to provide an accurate taxpayer identification number or to report all interest and dividends required to be shown on its federal income tax returns. Information reporting and backup withholding will not apply to payments of principal and interest made by PacifiCorp or a paying agent to a United States Alien Holder on a Series A Junior Subordinated Debenture distributed to a holder of Series A Preferred Securities if the certification described in clause (i)(c) under "United States Alien Holders" above is received, provided that the payor does not have actual knowledge that the holder is a United States Holder. Payments of the proceeds from the sale by a United States Alien Holder of Series A Preferred Securities or Series A Junior Subordinated Debentures distributed to such a holder made to or through a foreign office of a broker generally will not be subject to information reporting or backup withholding, except that, if the broker is a United States person, a controlled foreign corporation for United States tax purposes, or a foreign person 50% or more of whose gross income is effectively connected with a United States trade or business for a specified three-year period, information reporting may apply to such payments. Payments of the proceeds from the sale of Series A Preferred Securities or Series A Junior Subordinated Debentures distributed to a holder of Series A Preferred Securities to or through the United States office of a broker is subject to information reporting and backup withholding unless the holder or beneficial owner certifies as to its non-United States status or otherwise establishes an exemption from information reporting and backup withholding. S-22 UNDERWRITING Subject to the terms and conditions of the Underwriting Agreement, PacifiCorp Delaware has agreed to sell to each of the Underwriters named below, and each of the Underwriters, for whom Goldman, Sachs & Co., Smith Barney Inc. and are acting as Representatives (the "Representatives"), has severally agreed to purchase from PacifiCorp Delaware, the respective number of Series A Preferred Securities set forth opposite its name below: Number of Preferred Underwriter Securities ___________ __________ Goldman, Sachs & Co. . . . . . . . . . . Smith Barney Inc. . . . . . . . . . . . ________ Total . . . . . . . . . . . . . . . ======== The Underwriters propose to offer the Series A Preferred Securities in part directly to the public at the initial public offering price set forth on the cover page of this Prospectus Supplement, and in part to certain securities dealers at such price less a concession of $ per Series A Preferred Security. The Underwriters may allow, and such dealers may reallow, a concession not in excess of $ per Series A Preferred Security to certain brokers and dealers. After the Series A Preferred Securities are released for sale to the public, the offering price and other selling terms may from time to time be varied by the Representatives. Because the proceeds of the sale of the Series A Preferred Securities will ultimately be used to purchase the Series A Junior Subordinated Debentures, the Underwriting Agreement provides that PacifiCorp will pay an amount equal to $ per Series A Preferred Security ($ per Series A Preferred Security sold to certain institutions) for the accounts of the several Underwriters. PacifiCorp and PacifiCorp Delaware have agreed, during the period beginning from the date of the Underwriting Agreement and continuing to and including 30 days after the closing date, not to offer, sell, contract to sell, or otherwise dispose of any Series A Preferred Securities, any limited partnership interests of PacifiCorp Delaware, or any preferred stock or any other securities of PacifiCorp Delaware or PacifiCorp that are substantially similar to the Series A Preferred Securities, or any securities convertible into or exchangeable for Series A Preferred Securities, limited partnership interests, preferred stock or such substantially similar securities of either PacifiCorp Delaware or PacifiCorp, without the prior written consent of the Underwriters. Prior to this offering, there has been no public market for the Series A Preferred Securities. Application will be made to list the Series A Preferred Securities on the New York Stock Exchange. In order to meet one of the requirements for listing the Series A Preferred Securities on the New York Stock Exchange, the Underwriters will undertake to sell lots of 100 or more Series A Preferred Securities to a minimum of 400 beneficial holders. PacifiCorp Delaware and PacifiCorp have agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended, or to have PacifiCorp and PacifiCorp Delaware contribute to payments such Underwriters may be required to make on respect thereof. Certain of the Underwriters engage in transactions with, and from time to time have performed services for, PacifiCorp and its subsidiaries in the ordinary course of business. S-23 LEGAL MATTERS Certain matters of Delaware law relating to the validity of the Series A Preferred Securities, the validity of the Limited Partnership Agreement and the formation of PacifiCorp Delaware are being passed upon by Richards, Layton & Finger, P.A., special Delaware counsel to PacifiCorp and PacifiCorp Delaware. The validity of the Indenture, the Guarantee and the Series A Junior Subordinated Debentures will be passed upon on behalf of PacifiCorp Delaware and PacifiCorp by Stoel Rives Boley Jones & Grey, Portland, Oregon, and on behalf of the Underwriters by Winthrop, Stimson, Putnam & Roberts, New York, New York. Stoel Rives Boley Jones & Grey and Winthrop, Stimson, Putnam & Roberts may rely on Richards, Layton & Finger, P.A. as to certain matters of Delaware law. Statements as to United States taxation in the Prospectus Supplement under the caption "United States Taxation" have been passed upon for PacifiCorp and PacifiCorp Delaware by Stoel Rives Boley Jones & Grey and are stated herein on their authority. S-24 ===================================== ===================================== NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS AND, PREFERRED SECURITIES IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE PACIFICORP DELAWARE SECURITIES DESCRIBED IN THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY SUCH SECURITIES IN ANY CIRCUMSTANCE IN WHICH SUCH OFFER OR SOLICITATION IS UNLAWFUL. NEITHER THE DELIVERY OF THIS GUARANTEED TO THE EXTENT PROSPECTUS SUPPLEMENT OR THE SET FORTH HEREUNDER BY PROSPECTUS NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN OR PACIFICORP THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH INFORMATION. ____________________ TABLE OF CONTENTS % CUMULATIVE PROSPECTUS SUPPLEMENT MONTHLY INCOME PREFERRED SECURITIES, PacifiCorp Delaware, L.P. . . . . . S-3 SERIES A PacifiCorp . . . . . . . . . . . . S-3 Investment Considerations . . . . . S-4 Selected Financial Information . . S-6 Use of Proceeds . . . . . . . . . . S-6 Description of the Series A Preferred Securities . . . . . . S-7 ___________________ Description of the Series A Junior Subordinated Debentures . S-16 PROSPECTUS SUPPLEMENT United States Taxation . . . . . . S-20 Underwriting . . . . . . . . . . . S-23 ___________________ Legal Matters . . . . . . . . . . . S-24 PROSPECTUS Available Information . . . . . . . 2 Incorporation of Certain Documents by Reference . . . . . 2 PacifiCorp . . . . . . . . . . . . 3 PacifiCorp Delaware, L.P. . . . . . 3 Consolidated Ratios of Earnings to Fixed Charges . . . . . . . . 4 Consolidated Ratios of Earnings to Combined Fixed Charges and GOLDMAN, SACHS & CO. Preferred Stock Dividends . . . . 4 SMITH BARNEY INC. Use of Proceeds . . . . . . . . . . 4 Description of the Junior Subordinated Debentures . . . . . 4 Description of the Preferred Securities . . . . . . . . . . . 10 Description of the Guarantee . . . 11 Plan of Distribution . . . . . . . 13 Experts . . . . . . . . . . . . . . 14 Legal Opinions . . . . . . . . . . 14 ===================================== ===================================== S-25 SUBJECT TO COMPLETION, DATED OCTOBER __, 1994 PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED , 1994 _____ PREFERRED SECURITIES PACIFICORP DELAWARE CUMULATIVE ADJUSTABLE RATE MONTHLY INCOME PREFERRED SECURITIES, SERIES A ("MIPS"*) (LIQUIDATION PREFERENCE $25 PER PREFERRED SECURITY) GUARANTEED TO THE EXTENT SET FORTH HEREIN B PACIFICORP The Cumulative Adjustable Rate Monthly Income Preferred Securities, Series A (the "Series A Preferred Securities"), representing the limited partner interests offered hereby are being issued by PacifiCorp Delaware, L.P., a limited partnership formed under the laws of the State of Delaware ("PacifiCorp Delaware"). PacifiCorp, an Oregon corporation ("PacifiCorp"), is the general partner in PacifiCorp Delaware. PacifiCorp Delaware exists for the sole purpose of issuing its limited partnership interests and investing the proceeds thereof in debt securities of PacifiCorp. The limited partner interests represented by the Series A Preferred Securities will have a preference with respect to cash distributions and amounts payable on liquidation over the general partner's interest in PacifiCorp Delaware. Holders of the Series A Preferred Securities will be entitled to receive cumulative cash distributions accruing from the date of original issuance and payable monthly in arrears on the last day of each calendar month of each year, commencing , 1994 ("dividends"). The dividend rate will be adjusted quarterly. The rate for the initial period from the date of initial issuance to , 1994 will be % per annum, which is equivalent to $ per Series A Preferred Securities per annum. Thereafter, dividends on the Series A Preferred Securities will be payable at the "Applicable Rate" from time to time in effect. The Applicable Rate for any quarter will be equal to % of the highest of the "Treasury Bill Rate," the "Ten Year Constant Maturity Rate" and the "Thirty Year Constant Maturity Rate" determined in advance of such quarter. The Applicable Rate for any quarter will not be less than % per annum nor greater than % per annum. See "Description of the Series A Preferred Securities-- Dividends." The payment of dividends, out of moneys held by PacifiCorp Delaware, and payments on liquidation of PacifiCorp Delaware or the redemption of Series A Preferred Securities, as set forth below, are guaranteed by PacifiCorp to the extent described herein and in the accompanying Prospectus (the "Guarantee"). See "Description of the Guarantee" in the accompanying Prospectus. If PacifiCorp fails to make interest payments on the Adjustable Rate Deferrable Interest Junior Subordinated Debentures, Series A, Due 2034 (as described herein) ("Series A Junior Subordinated Debentures") purchased by PacifiCorp Delaware with the proceeds of the offering of the Series A Preferred Securities, PacifiCorp Delaware will have insufficient funds to pay dividends on the Series A Preferred Securities. The Guarantee does not cover payment of dividends when PacifiCorp Delaware does not have sufficient funds to pay such dividends. In such event, the remedy of a holder of Series A Preferred Securities is to enforce the rights of PacifiCorp Delaware under the Series A Junior Subordinated Debentures. The Series A Preferred Securities are redeemable at the option of PacifiCorp Delaware, in whole or in part, from time to time, on or after , 1999, at $25 per Series A Preferred Security plus accrued and unpaid dividends thereon (including any interest thereon) to the date fixed for redemption (the "Redemption Price"). See "Description of the Series A Preferred Securities--Optional Redemption." Upon the occurrence of certain events arising from a change in law or a change in legal interpretation regarding tax matters, PacifiCorp, in its capacity as the general partner of PacifiCorp Delaware (the "General Partner"), may dissolve PacifiCorp Delaware and cause to be distributed to the holders of the Series A Preferred Securities, on a pro rata basis, Series A Junior Subordinated Debentures in lieu of any cash distribution. If the Series A Junior Subordinated Debentures are distributed to the holders of the Series A Preferred Securities, PacifiCorp will use its best efforts to have the Series A Junior Subordinated Debentures listed on the New York Stock Exchange or on such other exchange as the Series A Preferred Securities are then listed. The obligations of PacifiCorp under the Series A Junior Subordinated Debentures are subordinate and junior in right of payment to Senior Indebtedness (as defined in the accompanying Prospectus) of PacifiCorp. At June 30, 1994, Senior Indebtedness of PacifiCorp aggregated approximately $3.7 billion. Senior Indebtedness includes only indebtedness of PacifiCorp on an unconsolidated basis.See "Description of the Series A Preferred Securities--Tax Event Distribution" and "Description of the Series A Junior Subordinated Debentures." In the event of the dissolution of PacifiCorp Delaware, the holders of the Series A Preferred Securities will be entitled to receive for each Series A Preferred Security a liquidation preference of $25 plus accrued and unpaid dividends thereon (including any interest thereon) to the date of payment, subject to certain limitations, unless, in connection with such dissolution, Series A Junior Subordinated Debentures are distributed to the holders of the Series A Preferred Securities. See "Description of the Series A Preferred Securities--Liquidation Distribution Upon Dissolution." -------------------- SEE "INVESTMENT CONSIDERATIONS" FOR CERTAIN INFORMATION RELEVANT TO AN INVESTMENT IN THE SERIES A PREFERRED SECURITIES, INCLUDING THE PERIOD DURING WHICH AND CIRCUMSTANCES UNDER WHICH PAYMENT OF DIVIDENDS ON THE SERIES A PREFERRED SECURITIES MAY BE DEFERRED. -------------------- Application will be made to list the Series A Preferred Securities on the New York Stock Exchange. Listing will be made subject to meeting the requirements of such Exchange, including those relating to distribution. -------------------- THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS TO WHICH IT RELATES. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. --------------------
Proceeds to Initial Public Underwriting PacifiCorp Offering Price Commission(1) Delaware(2)(3) -------------- ------------- -------------- Per Series A Preferred Security $ (2) $ Total. . . . . . . . . . . . $ (2) $ __________ (1) PacifiCorp Delaware and PacifiCorp have agreed to indemnify the several Underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended. See "Underwriting." (2) Because the proceeds of the sale of the Series A Preferred Securities will ultimately be invested in Series A Junior Subordinated Debentures, the Underwriting Agreement provides that PacifiCorp will pay to the Underwriters $ per Series A Preferred Security (or $ in the aggregate); provided, that such compensation will be $ per Series A Preferred Security sold to certain institutions. Therefore, to the extent that Series A Preferred Securities are sold to such institutions, the actual amount of underwriting commission will be less than the amount specified in the preceding sentence. See "Underwriting." (3) Expenses of the offering which are payable by PacifiCorp are estimated to be $ .
-------------------- The Series A Preferred Securities offered hereby are offered severally by the Underwriters, as specified herein, and subject to receipt and acceptance by them and subject to their right to reject any order in whole or in part. It is expected that delivery of the Series A Preferred Securities will be made only in book-entry form through the facilities of The Depository Trust Company on or about , 1994. __________ * An application has been filed by Goldman, Sachs & Co. with the United States Patent and Trademark Office for the registration of the MIPS servicemark. -------------------- GOLDMAN, SACHS & CO. SMITH BARNEY INC. THE DATE OF THIS PROSPECTUS SUPPLEMENT IS , 1994. Information contained herein is subject to completion or amendment. A registration statement relating to these securities has been filed with the Securities and Exchange Commission. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This prospectus shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. S-2 IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES OFFERED HEREBY AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE, IN THE OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. S-3 PACIFICORP DELAWARE, L.P. PacifiCorp Delaware is a limited partnership which was formed under the Delaware Revised Uniform Limited Partnership Act (the "Partnership Act") by filing a certificate of limited partnership with the Delaware Secretary of State on August 26, 1994. The initial partners in PacifiCorp Delaware are PacifiCorp, as the General Partner, and PacifiCorp Preferred Capital, Inc., a Delaware corporation ("Capital"), as limited partner. Upon the issuance of the Series A Preferred Securities, which securities represent limited partner interests in PacifiCorp Delaware, Capital will remain as a limited partner, but will have no interest in the profits and dividends or in the assets of PacifiCorp Delaware. The General Partner will agree to contribute capital to the extent required to maintain its capital at an amount equal to at least 3% of the total capital contributions to PacifiCorp Delaware. PacifiCorp and Capital entered into a limited partnership agreement dated as of August 25, 1994. Such limited partnership agreement will be amended and restated in its entirety (as so amended and restated, the "Limited Partnership Agreement") substantially in the form filed as an exhibit to the Registration Statement of which this Prospectus Supplement and the accompanying Prospectus form a part. PacifiCorp Delaware is managed by the General Partner and exists for the sole purpose of issuing its limited partnership interests and investing the proceeds thereof in deferrable interest junior subordinated debentures of PacifiCorp ("Junior Subordinated Debentures"). The rights of the holders of the Series A Preferred Securities, including economic rights, rights to information and voting rights, are set forth in the Limited Partnership Agreement and the Partnership Act. See "Description of the Series A Preferred Securities." PACIFICORP PacifiCorp is an electric utility that conducts a retail electric utility business through two divisions, Pacific Power & Light Company ("Pacific Power") and Utah Power & Light Company ("Utah Power"), and engages in power production and sales on a wholesale basis under the name PacifiCorp. PacifiCorp is the indirect owner, through PacifiCorp Holdings, Inc. (a wholly-owned subsidiary), of 87% of Pacific Telecom, Inc. ("Pacific Telecom") and 100% of PacifiCorp Financial Services, Inc. ("PFS"). Pacific Power and Utah Power furnish electric service in portions of seven western states: California, Idaho, Montana, Oregon, Utah, Washington and Wyoming. Pacific Telecom, through its subsidiaries, provides local telephone service and access to the long distance network in Alaska, seven other western states and three midwestern states, provides intrastate and interstate long distance communication services in Alaska, provides cellular mobile telephone services, and is engaged in sales of capacity in and operation of a submarine fiber optic cable between the United States and Japan. PFS plans to sell substantial portions of its loan, leasing and real estate investments over the next several years. The principal executive offices of PacifiCorp are located at 700 NE Multnomah, Suite 1600, Portland, Oregon 97232; the telephone number is (503) 731-2000. S-4 INVESTMENT CONSIDERATIONS Prospective purchasers of Series A Preferred Securities should carefully review the information contained elsewhere in this Prospectus Supplement and in the accompanying Prospectus and should particularly consider the following matters: SUBORDINATE OBLIGATIONS UNDER GUARANTEE AND SERIES A JUNIOR SUBORDINATED DEBENTURES. PacifiCorp's obligations under the Guarantee are subordinate and junior in right of payment to all other liabilities of PacifiCorp. The obligations of PacifiCorp under the Series A Junior Subordinated Debentures described under "Description of the Series A Junior Subordinated Debentures" are subordinate and junior in right of payment to Senior Indebtedness (as defined in the accompanying Prospectus) of PacifiCorp. At June 30, 1994, Senior Indebtedness of PacifiCorp aggregated approximately $3.7 billion. There are no terms in the Series A Preferred Securities, the Series A Junior Subordinated Debentures or the Guarantee that limit PacifiCorp's ability to incur additional indebtedness, including indebtedness that ranks senior to the Series A Junior Subordinated Debentures and the Guarantee. See "Description of the Guarantee--Status of the Guarantee" and "Description of the Junior Subordinated Debentures-- Subordination" in the accompanying Prospectus. OPTION TO EXTEND INTEREST PAYMENT PERIOD. PacifiCorp has the right under the Indenture (as defined herein) to extend the interest payment period from time to time on the Series A Junior Subordinated Debentures to a period not exceeding 60 consecutive months, and, as a consequence, monthly dividends on the Series A Preferred Securities would be deferred (but would continue to accrue with interest thereon) by PacifiCorp Delaware during any such extended interest payment period. In the event that PacifiCorp exercises this right, PacifiCorp may not declare or pay dividends on, or redeem, purchase or acquire, any of its capital stock. Prior to the termination of any such extension period, PacifiCorp may further extend the interest payment period, provided that any such extension period together with all such previous and further extensions thereof may not exceed 60 consecutive months. Upon the termination of any extension period and the payment of all amounts then due, PacifiCorp may select a new extension period, subject to the above requirements. PacifiCorp Delaware and PacifiCorp believe that the extension of a payment period on the Series A Junior Subordinated Debentures is unlikely. See "Description of the Series A Preferred Securities--Dividends" and "Description of the Series A Junior Subordinated Debentures--Option to Extend Interest Payment Period." Should an extended interest payment period occur, PacifiCorp Delaware will continue to accrue income for United States federal income tax purposes, which will be allocated, but not distributed, to holders of record of Series A Preferred Securities. As a result, such a holder will include such interest in gross income for United States federal income tax purposes in advance of the receipt of cash, and will not receive the cash from PacifiCorp Delaware related to such income if such a holder disposes of his or her Series A Preferred Securities prior to the record date for payment of dividends. See "United States Taxation--Potential Extension of Interest Payment Period." TAX EVENT DISTRIBUTION. Upon the occurrence of a Tax Event (as defined herein), the General Partner will dissolve PacifiCorp Delaware and cause Series A Junior Subordinated Debentures to be distributed to the holders of the Series A Preferred Securities in connection with the liquidation of PacifiCorp Delaware provided, however, that, as a condition to such dissolution and distribution, PacifiCorp Delaware shall be required to obtain an opinion of counsel (which may be regular tax counsel to PacifiCorp or an affiliate, but not an employee thereof) to the effect that the holders of the Series A Preferred Securities will not recognize any gain or loss for federal income tax purposes as a result of such dissolution and distribution of Series A Junior Subordinated Debentures, and, provided further, that the General Partner may elect to cause the Series A Preferred Securities to remain outstanding. See "Description of the Series A Preferred Securities--Tax Event Distribution." In April 1994, the Internal Revenue Service (the "IRS") issued certain notices generally addressing the characteristics which distinguish debt from equity for various purposes under the federal income tax laws. In these notices, the IRS indicated that transactions involving securities that, like the securities offered hereby, have both debt and equity characteristics would be reviewed with scrutiny to determine how they would be treated for tax purposes. PacifiCorp believes that interest on the Series A Junior Subordinated Debentures will be deductible under the tests referred to in these notices. If, S-5 however, the General Partner shall have obtained an opinion of nationally recognized independent tax counsel experienced in such matters to the effect that, as a result of (a) any amendment to, or change (including any announced prospective change) in, the laws (or any regulations thereunder) of the United States or any political subdivision or taxing authority thereof or therein, (b) any notice of proposed adjustment issued by the IRS to PacifiCorp or PacifiCorp Delaware, (c) any amendment to or change in an interpretation or application of such laws or regulations by any legislative body, court, governmental agency or regulatory authority (including the enactment of any legislation and the publication of any judicial decision or regulatory determination on or after such date) or (d) any interpretation or pronouncement that provides for a position with respect to such laws or regulations that differs from the generally accepted position on , 1994, which amendment or change is effective, which notice of proposed adjustment is issued or which interpretation or pronouncement is announced on or after , 1994, there is more than an insubstantial risk that interest payable to PacifiCorp Delaware on the Series A Junior Subordinated Debentures will not be deductible by PacifiCorp for federal income tax purposes (or PacifiCorp Delaware is subject to federal income tax with respect to interest received on the Series A Junior Subordinated Debentures or to more than a de minimis amount of other taxes, duties or other governmental charges), the General Partner would have the option, subject to receiving a favorable opinion of tax counsel, to dissolve PacifiCorp Delaware and cause the Series A Junior Subordinated Debentures to be distributed to the holders of the Series A Preferred Securities, as described under "Description of the Series A Preferred Securities--Tax Event Distribution." S-6 SELECTED FINANCIAL INFORMATION (Dollar amounts in millions, except per share amounts) The following selected financial information for each of the three years in the period ended December 31, 1993 and six months ended June 30, 1993 and 1994, has been derived from the consolidated financial statements of PacifiCorp for the respective periods. The consolidated financial statements for the three-year period ended December 31, 1993 have been audited by Deloitte & Touche LLP, independent auditors, and the reports of Deloitte & Touche LLP are incorporated in the accompanying Prospectus by reference. This selected financial information should be read in conjunction with the financial statements and related notes thereto included in the Incorporated Documents (as defined in the accompanying Prospectus).
Twelve Months Ended Six Months December 31, Ended June 30, ------------------- -------------- 1991 1992 1993 1993 1994 ---- ---- ---- ---- ---- Income Statement Data: Revenues $3,168 $3,242 $3,412 $1,668 $1,701 Income from Operations (1) 941 633 916 445 453 Income from Continuing Operations 447 150 423 204 210 Discontinued Operations (2) 60 (491) 52 -- -- Cumulative Effect on Prior Years of a Change in Accounting for Income Taxes -- -- 4 4 -- Net Income (Loss) 507 (341) 479 208 210 Preferred Stock Dividend Requirements 26 37 39 19 20 Earnings (Loss) on Common Stock 481 (378) 440 189 190 Earnings (Loss) per Common Share: Continuing Operations 1.63 .42 1.40 .68 .67 Discontinued Operations .23 (1.84) .19 -- -- Cumulative Effect on Prior Years of a Change in Accounting for Income Taxes -- -- .01 .01 -- June 30, 1994 --------------------------------------- Actual As Adjusted(3) ----------------- ------------------ Amount % Amount % ------ --- ------ --- Capital Structure: Long-Term Debt and Capital Lease Obligations $3,814 49% $3,814 49% Preferred Stock 367 5 367 5 Preferred Stock Subject to Mandatory Redemption 219 3 219 3 Common Equity 3,345 43 3,345 43 ----- --- ----- --- Total $7,745 100% $7,745 100% ===== === ===== === Short-Term Debt $ 528 Long-term Debt and Capital Lease Obligations Currently Maturing $ 164 $ 164 Minority Interest $ 104 $ ____________________ (1) Income before income taxes, interest, other nonoperating items, discontinued operations and cumulative effect of a change in an accounting principle. (2) Discontinued operations represents PacifiCorp's interests in NERCO, Inc. and an international communications subsidiary of Pacific Telecom. (3) Adjusted to give effect to the issuance and sale of the Series A Preferred Securities of PacifiCorp Delaware and the investment of the proceeds thereof in Series A Junior Subordinated Debentures of PacifiCorp. Such proceeds will ultimately be used by PacifiCorp to retire its short-term debt. See "Use of Proceeds." The above table sets forth the effects of consolidation of PacifiCorp and all of its consolidated subsidiaries, including PacifiCorp Delaware. The Series A Preferred Securities are recorded as minority interest.
USE OF PROCEEDS The proceeds from the sale of the Series A Preferred Securities will be invested in the Series A Junior Subordinated Debentures issued pursuant to the Indenture described herein, and ultimately will be used by PacifiCorp to repay its short-term borrowings and for the other corporate purposes. S-7 DESCRIPTION OF THE SERIES A PREFERRED SECURITIES GENERAL All of the partnership interests in PacifiCorp Delaware, other than the Series A Preferred Securities offered hereby, are owned directly or indirectly by PacifiCorp. The Limited Partnership Agreement authorizes and creates the Series A Preferred Securities, which represent limited partner interests in PacifiCorp Delaware (the "Preferred Securities"). Preferred Securities may be issued from time to time in one or more series as described in the accompanying Prospectus. The limited partner interests represented by the Series A Preferred Securities will have a preference with respect to dividends and amounts payable on liquidation over the General Partner's interest in PacifiCorp Delaware. The Limited Partnership Agreement does not permit the issuance of any Preferred Securities ranking, as to participation in profits and dividends and in the assets of PacifiCorp Delaware, senior or junior to the Series A Preferred Securities or the incurrence of any indebtedness by PacifiCorp Delaware. The summary of certain terms and provisions of the Series A Preferred Securities set forth below does not purport to be complete and is subject to, and qualified in its entirety by reference to, the Limited Partnership Agreement and the Partnership Act. DIVIDENDS Dividends on the Series A Preferred Securities will be cumulative, will accrue from , 1994 and will be payable monthly in arrears, on the last day of each calendar month of each year, commencing , 1994, when, as and if available and determined to be so payable by PacifiCorp, as the General Partner, except as otherwise described below. Accrued and unpaid dividends after the dividend payment date therefor will bear interest thereon at the rate per annum equal to the dividend rate during the period of arrearage. The term "dividends" as used herein includes any such interest payable unless otherwise stated. The amount of dividends payable for any period will be computed on the basis of a 360-day year of twelve 30-day months. The dividend rate will be adjusted quarterly. The rate for the initial period from the date of initial issuance to , 1994 will be % per annum, which is equivalent to $ per Series A Preferred Security per annum. Thereafter, dividends on the Series A Preferred Securities will be payable at the "Applicable Rate" (as defined below) from time to time in effect. PacifiCorp has the right under the Indenture to extend the interest payment period from time to time on the Series A Junior Subordinated Debentures to a period not exceeding 60 consecutive months, and, as a consequence, monthly dividends on the Series A Preferred Securities would be deferred (but would continue to accrue with interest) by PacifiCorp Delaware during any such extended interest payment period. In the event that PacifiCorp exercises this right, PacifiCorp may not declare or pay dividends on, or redeem, purchase or acquire, any of its capital stock. Prior to the termination of any such extension period, PacifiCorp may further extend the interest payment period, provided that such extension period together with all such previous and further extensions thereof may not exceed 60 consecutive months. Upon the termination of any extension period and the payment of all amounts then due, PacifiCorp may select a new extension period, subject to the above requirements. See "Description of the Series A Junior Subordinated Debentures--Interest" and "--Option to Extend Interest Payment Period." Dividends on the Series A Preferred Securities must be paid on the dates payable to the extent that PacifiCorp Delaware has (i) funds legally available for the payment of such dividends and (ii) cash on hand sufficient to permit such payments. It is anticipated that PacifiCorp Delaware's earnings available for distribution to the holders of the Series A Preferred Securities will be limited to payments under the Series A Junior Subordinated Debentures in which PacifiCorp Delaware will invest the proceeds from the issuance and sale of the Series A Preferred Securities and the General Partner's capital contribution. See "Description of the Series A Junior Subordinated Debentures." The payment of dividends, out of moneys held by PacifiCorp Delaware, are guaranteed by PacifiCorp as set forth under "Description of the Guarantee" in the accompanying Prospectus. S-8 Dividends on the Series A Preferred Securities will be payable to the holders thereof as they appear on the books and records of PacifiCorp Delaware on the relevant record dates, which, as long as the Series A Preferred Securities remain in book-entry-only form, will be one Business Day (as defined below) prior to the relevant payment dates. Subject to any applicable laws and regulations and the provisions of the Limited Partnership Agreement, each such payment will be made as described under "Book-Entry-Only Issuance-The Depository Trust Company" below. In the event the Series A Preferred Securities shall not continue to remain in book-entry-only form, the General Partner shall have the right to select relevant record dates, which shall be more than one Business Day prior to the relevant payment dates. In the event that any date on which dividends are payable on the Series A Preferred Securities is not a Business Day, then payment of the dividend payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay) except that, if such Business Day is in the next succeeding calendar year, such payment shall be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such date. A "Business Day" shall mean any day other than a day on which banking institutions in The City of New York are authorized or required by law to close. Except as provided below in this paragraph, the "Applicable Rate" for any quarter (other than the initial period) will be equal to % of the Effective Rate (as defined below), but not less than % per annum nor more than % per annum. The "Effective Rate" for any quarter will be equal to the highest of the Treasury Bill Rate, the Ten Year Constant Maturity Rate and the Thirty Year Constant Maturity Rate (each as defined below) for such quarter. The Applicable Rate will be rounded to the nearest five hundredths of a percent. In the event that PacifiCorp Delaware determines in good faith that for any reason: (i) any one of the Treasury Bill Rate, the Ten Year Constant Maturity Rate or the Thirty Year Constant Maturity Rate cannot be determined for any quarter, then the Effective Rate for such quarter will be equal to the higher of whichever two of such rates can be so determined. (ii) only one of the Treasury Bill Rate, the Ten Year Constant Maturity Rate and the Thirty Year Constant Maturity Rate can be determined for any quarter, then the Effective Rate for such quarter will be equal to whichever such rate can be so determined; or (iii) none of the Treasury Bill Rate, the Ten Year Constant Maturity Rate and the Thirty Year Constant Maturity Rate can be determined for any quarter, then the Effective Rate for the preceding quarter will be continued for such quarter. Except as described below in this paragraph, the "Treasury Bill Rate" for each quarter will be the arithmetic average of the two most recent weekly per annum secondary market discount rates (or the one weekly per annum secondary market discount rate, if only one such rate is published during the relevant Calendar Period (as defined below)) for three-month U.S. Treasury bills, as published weekly by the Federal Reserve Board (as defined below) during the Calendar Period immediately preceding the last ten calendar days preceding the quarter for which the dividend rate on the Series A Preferred Securities is being determined. In the event that the Federal Reserve Board does not publish such a weekly per annum secondary market discount rate during any such Calendar Period, then the Treasury Bill Rate for such quarter will be the arithmetic average of the two most recent weekly per annum secondary market discount rates (or the one weekly per annum secondary market discount rate, if only one such rate is published during the relevant Calendar Period) for three-month U.S. Treasury bills, as published weekly during such Calendar Period by any Federal Reserve Bank or by any U.S. Government department or agency selected by PacifiCorp Delaware. In the event that a per annum secondary market discount rate for three-month U.S. Treasury bills is not published by the Federal Reserve Board or by any Federal Reserve Bank or by any U.S. Government department or agency during such Calendar Period, then the Treasury Bill Rate for such quarter will be the arithmetic average of the two most recent weekly per annum secondary market discount rates (or the one weekly per annum secondary market discount rate, if only one such rate is published during the relevant Calendar Period) for all of the U.S. Treasury bills then having remaining maturities of not less than 80 nor more than 100 days, as published during such Calendar Period by the Federal Reserve Board, or if the Federal Reserve Board does not publish such rates, by any Federal Reserve Bank or by any U.S. Government department or agency selected by PacifiCorp Delaware. In the event that PacifiCorp Delaware determines in good faith that for any S-9 reason no such U.S. Treasury bill rates are published as provided above during such Calendar Period, then the Treasury Bill Rate for such quarter will be the arithmetic average of the per annum secondary market discount rates based upon the closing bids during such Calendar Period for each of the issues of marketable non-interest-bearing U.S. Treasury securities with a remaining maturity of not less than 80 nor more than 100 days from the date of each such quotation, as chosen and quoted daily for each business day in New York City (or less frequently if daily quotations are not generally available) to PacifiCorp Delaware by at least three recognized dealers in U.S. Government securities selected by PacifiCorp Delaware. In the event that PacifiCorp Delaware determines in good faith that for any reason PacifiCorp Delaware cannot determine the Treasury Bill Rate for any quarter as provided above in this paragraph, the Treasury Bill Rate for such quarter will be the arithmetic average of the per annum secondary market discount rate based upon the closing bids during such Calendar Period for each of the issues of marketable interest-bearing U.S. Treasury securities with a remaining maturity of not less than 80 nor more than 100 days, as chosen and quoted daily for each business day in New York City (or less frequently if daily quotations are not generally available) to PacifiCorp Delaware by at least three recognized dealers in U.S. Government securities selected by PacifiCorp Delaware. Except as described below in this paragraph, the "Ten Year Constant Maturity Rate" for each quarter will be the arithmetic average of the two most recent weekly per annum Ten Year Average Yields (as defined below) (or the one weekly per annum Ten Year Average Yield, if only one such yield is published during the relevant Calendar Period), as published weekly by the Federal Reserve Board during the Calendar Period immediately preceding the last ten calendar days preceding the quarter for which the dividend rate on the Series A Preferred Securities is being determined. In the event that the Federal Reserve Board does not publish such a weekly per annum Ten Year Average Yield during such Calendar Period, then the Ten Year Constant Maturity Rate for such quarter will be the arithmetic average of the two most recent weekly per annum Ten Year Average Yields (or the one weekly per annum Ten Year Average Yield, if only one such yield is published during the relevant Calendar Period), as published weekly during such Calendar Period by any Federal Reserve Bank or by any U.S. Government department or agency selected by PacifiCorp Delaware. In the event that a per annum Ten Year Average Yield is not published by the Federal Reserve Board or by the Federal Reserve Bank or by any U.S. Government department or agency during such Calendar Period, then the Ten Year Constant Maturity Rate for such quarter will be the arithmetic average of the two most recent weekly per annum average yields to maturity (or the one weekly per annum average yield to maturity, if only one such yield is published during the relevant Calendar Period) for all of the actively traded marketable U.S. Treasury fixed interest rate securities (other than Special Securities (as defined below)) then having remaining maturities of not less than eight nor more than twelve years, as published during such Calendar Period by the Federal Reserve Board or, if the Federal Reserve Board does not publish such yields, by any Federal Reserve Bank or by any U.S. Government department or agency selected by PacifiCorp Delaware. In the event that PacifiCorp Delaware determines in good faith that for any reason PacifiCorp Delaware cannot determine the Ten Year Constant Maturity Rate for any quarter as provided above in this paragraph, then the Ten Year Constant Maturity Rate for such quarter will be the arithmetic average of the per annum average yields to maturity based upon the closing bids during such Calendar Period for each of the issues of actively traded marketable U.S. Treasury fixed interest rate securities (other than Special Securities) with a final maturity date not less than eight or more than twelve years from the date of each such quotation, as chosen and quoted daily for each business day in New York City (or less frequently if daily quotations are not generally available) to PacifiCorp Delaware by at least three recognized dealers in U.S. Government securities selected by PacifiCorp Delaware. Except as described below in this paragraph, the "Thirty Year Constant Maturity Rate" for each quarter will be the arithmetic average of the two most recent weekly per annum Thirty Year Average Yields (as defined below) (or the one weekly per annum Thirty Year Average Yield, if only one such yield is published during the relevant Calendar Period), as published weekly by the Federal Reserve Board during the Calendar Period immediately preceding the last ten calendar days preceding the quarter for which the dividend rate on the Series A Preferred Securities is being determined. In the event that the Federal Reserve Board does not publish such a weekly per annum Thirty Year Average Yield during such Calendar Period, then the Thirty Year Constant Maturity Rate for such quarter will be the arithmetic average of the two most recent weekly per annum Thirty Year Average Yields (or the one weekly per annum Thirty Year Average Yield, if only one such yield is published during the relevant Calendar Period), as published weekly during such Calendar Period by any Federal Reserve Bank or by S-10 any U.S. Government department or agency selected by PacifiCorp Delaware. In the event that a per annum Thirty Year Average Yield is not published by the Federal Reserve Board or by any Federal Reserve Bank or by any U.S. Government department or agency during such Calendar Period, then the Thirty Year Constant Maturity Rate for such quarter will be the arithmetic average of the two most recent weekly per annum average yields to maturity (or the one weekly per annum average yield to maturity, if only one such yield is published during the relevant Calendar Period) for all of the actively traded marketable U.S. Treasury fixed interest rate securities (other than Special Securities) then having remaining maturities of not less than twenty-eight nor more than thirty-two years, as published during such Calendar Period by the Federal Reserve Board or, if the Federal Reserve Board does not publish such yields, by any Federal Reserve Bank or by any U.S. Government department or agency selected by PacifiCorp Delaware. In the event that PacifiCorp Delaware determines in good faith that for any reason PacifiCorp Delaware cannot determine the Thirty Year Constant Maturity Rate for any quarter as provided above in this paragraph, then the Thirty Year Constant Maturity Rate for such quarter will be the arithmetic average of the per annum average yields to maturity based upon the closing bids during such Calendar Period for each of the issues of actively traded marketable U.S. Treasury fixed interest rate securities (other than Special Securities) with a final maturity date not less than twenty-eight nor more than thirty-two years from the date of each such quotation, as chosen and quoted daily for each business day in New York City (or less frequently if daily quotations are not generally available) to PacifiCorp Delaware by at least three recognized dealers in U.S. Government securities selected by PacifiCorp Delaware. The Treasury Bill Rate, the Ten Year Constant Maturity Rate and the Thirty Year Constant Maturity Rate will each be rounded to the nearest one hundredth of a percent. The Applicable Rate with respect to each quarter (other than the initial period) will be calculated as promptly as practicable by PacifiCorp Delaware according to the appropriate method described above. PacifiCorp Delaware will cause each Applicable Rate to be published in a newspaper of general circulation in New York City before the commencement of the quarter to which it applies and will cause notice of such Applicable Rate to be given to The Depository Trust Company (the "Depository" or "DTC"), New York, New York, the securities depository for the Series A Preferred Securities. See "Book-Entry-Only Issuance--The Depository Trust Company" below. As used above, the term "Calendar Period" means a period of fourteen calendar days; the term "Federal Reserve Board" means the Board of Governors of the Federal Reserve System; the term "Special Securities" means securities which can, at the option of the holder, be surrendered at face value in payment of any Federal estate tax or which provide tax benefits to the holder and are priced to reflect such tax benefits or which were originally issued at a deep or substantial discount; the term "Ten Year Average Yield" means the average yield to maturity for actively traded marketable U.S. Treasury fixed interest rate securities adjusted to constant maturities of ten years; and the term "Thirty Year Average Yield" means the average yield to maturity for actively traded marketable U.S. Treasury fixed interest rate securities adjusted to constant maturities of thirty years. CERTAIN RESTRICTIONS ON PACIFICORP DELAWARE If dividends have not been paid in full on the Series A Preferred Securities, PacifiCorp Delaware shall not: (i) pay, or set aside for payment, any dividends on any other series of Preferred Securities, unless the amount of any dividends declared on any other series of Preferred Securities is paid on such other series of Preferred Securities and the Series A Preferred Securities on a pro rata basis on the date such dividends are paid on such other series of Preferred Securities, so that (x) the aggregate amount of dividends paid on the Series A Preferred Securities bears to the aggregate amount of dividends paid on such other series of Preferred Securities the same ratio as S-11 (y) the aggregate of all accrued and unpaid dividends in respect of the Series A Preferred Securities bears to the aggregate of all accrued and unpaid dividends in respect of such other series of Preferred Securities; or (ii) redeem, purchase or otherwise acquire any other Preferred Securities; until, in each case, such time as all accrued and unpaid dividends on the Series A Preferred Securities shall have been paid in full for all dividend periods terminating on or prior to, in the case of clause (i), such payment and, in the case of clause (ii), the date of such redemption, purchase or acquisition. As of the date of this Prospectus Supplement, there are no series of Preferred Securities outstanding. OPTIONAL REDEMPTION The Series A Preferred Securities are redeemable, at the option of PacifiCorp Delaware, in whole or in part, from time to time, on or after , 1999, upon not less than 30 nor more than 60 days' notice, at the Redemption Price. In the event that fewer than all the outstanding Series A Preferred Securities are to be so redeemed, the Series A Preferred Securities to be redeemed will be selected as described under "Book-Entry-Only Issuance--The Depository Trust Company" below. If a partial redemption would result in the delisting of the Series A Preferred Securities, PacifiCorp Delaware may only redeem the Series A Preferred Securities in whole. If PacifiCorp Delaware redeems the Series A Preferred Securities in accordance with the terms thereof, the Series A Junior Subordinated Debentures will become due and payable in a principal amount equal to the aggregate stated liquidation preference of the Series A Preferred Securities so redeemed, together with any accrued and unpaid interest, including Additional Interest (as defined below), if any. TAX EVENT DISTRIBUTION If a Tax Event (as defined below) shall occur and be continuing, the General Partner shall dissolve PacifiCorp Delaware and, after satisfaction of liabilities of creditors as required by the Partnership Act, cause Series A Junior Subordinated Debentures having an aggregate principal amount and accrued and unpaid interest equal to the aggregate of the stated liquidation preference of, and accrued and unpaid dividends on, the Series A Preferred Securities to be distributed to the holders of the Series A Preferred Securities in liquidation of PacifiCorp Delaware, within 90 days following the occurrence of such Tax Event; provided, however, that, as a condition of such dissolution and distribution, PacifiCorp Delaware shall be required to obtain an opinion of counsel (which may be regular tax counsel to PacifiCorp or an affiliate, but not an employee thereof) to the effect that the holders of the Series A Preferred Securities will not recognize any gain or loss for federal income tax purposes as a result of such dissolution and distribution of Series A Junior Subordinated Debentures; and, provided further, that the General Partner may elect to cause the Series A Preferred Securities to remain outstanding. "Tax Event" means that the General Partner shall have obtained an opinion of nationally recognized independent tax counsel experienced in such matters to the effect that, as a result of (a) any amendment to, or change (including any announced prospective change) in, the laws (or any regulations thereunder) of the United States or any political subdivision or taxing authority thereof or therein, (b) any notice of proposed adjustment issued by the IRS to PacifiCorp or PacifiCorp Delaware, (c) any amendment to or change in an interpretation or application of such laws or regulations by any legislative body, court, governmental agency or regulatory authority (including the enactment of any legislation and the publication of any judicial decision or regulatory determination on or after such date) or (d) any interpretation or pronouncement that provides for a position with respect to such laws or regulations that differs from the generally accepted position on , 1994, which amendment or change is effective, which notice of proposed adjustment is issued or which interpretation or pronouncement is announced on or after , 1994, there is more than an insubstantial risk that (i) PacifiCorp Delaware is subject to federal income tax with respect to interest received on the Series A Junior Subordinated Debentures, (ii) interest payable to PacifiCorp Delaware on the Series A Junior Subordinated Debentures will not be deductible by PacifiCorp for federal income tax purposes or (iii) PacifiCorp Delaware will be subject to more than a de minimis amount of other taxes, duties or other governmental charges. S-12 After the date fixed for any distribution of Series A Junior Subordinated Debentures, upon dissolution of PacifiCorp Delaware, (i) the Series A Preferred Securities will no longer be deemed to be outstanding, (ii) DTC or its nominee, as the record holder of the Series A Preferred Securities, will return the registered global certificate or certificates representing the Series A Preferred Securities and will receive a registered global certificate or certificates representing the Series A Junior Subordinated Debentures to be delivered upon such distribution and (iii) any certificates representing Series A Preferred Securities not held by DTC or its nominee will be deemed to represent Series A Junior Subordinated Debentures having an aggregate principal amount and accrued and unpaid interest equal to the aggregate of the stated liquidation preference of, and accrued and unpaid dividends on, such Series A Preferred Securities until such certificates are presented to PacifiCorp or its agent for transfer or reissuance. MANDATORY REDEMPTION Upon any redemption or repayment of the Series A Junior Subordinated Debentures at maturity or earlier, the proceeds from such redemption or repayment will be applied to redeem the Series A Preferred Securities, in whole or in part, upon not less than 30 nor more than 60 days' notice, at the Redemption Price. REDEMPTION PROCEDURES PacifiCorp Delaware may not redeem fewer than all the outstanding Series A Preferred Securities unless all accrued and unpaid dividends have been paid on all Series A Preferred Securities for all monthly dividend periods terminating on or prior to the date of redemption. If PacifiCorp Delaware gives a notice of redemption in respect of Series A Preferred Securities (which notice will be irrevocable), then, by 12:00 noon, New York time, on the redemption date, PacifiCorp Delaware will irrevocably deposit with DTC funds sufficient to pay the applicable Redemption Price and will give DTC irrevocable instructions and authority to pay the Redemption Price to the holders of the Series A Preferred Securities. See "Book-Entry-Only Issuance--The Depository Trust Company." If notice of redemption shall have been given and funds deposited as required, then upon the date of such deposit, all rights of holders of such Series A Preferred Securities so called for redemption will cease, except the right of the holders of such Series A Preferred Securities to receive the Redemption Price, but without interest on such Redemption Price. In the event that any date fixed for redemption of Series A Preferred Securities is not a Business Day, then payment of the Redemption Price payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay), except that, if such Business Day falls in the next calendar year, such payment will be made on the immediately preceding Business Day. In the event that payment of the Redemption Price in respect of Series A Preferred Securities is improperly withheld or refused and not paid either by PacifiCorp Delaware or by PacifiCorp pursuant to the Guarantee described under "Description of the Guarantee" in the accompanying Prospectus, dividends on such Series A Preferred Securities will continue to accrue at the then applicable rate, from the original redemption date to the date of payment, in which case the actual payment date will be considered the date fixed for redemption for purposes of calculating the Redemption Price. Subject to the foregoing and applicable law (including, without limitation, United States federal securities laws), PacifiCorp or its subsidiaries may at any time and from time to time purchase outstanding Series A Preferred Securities by tender, in the open market, or by private agreement. LIQUIDATION DISTRIBUTION UPON DISSOLUTION In the event of any voluntary or involuntary dissolution, winding-up or termination of PacifiCorp Delaware, the holders of the Series A Preferred Securities at the time will be entitled to receive out of the assets of PacifiCorp Delaware available for distribution to partners after satisfaction of liabilities of creditors as required by the Partnership Act, before any distribution of assets is made to the General Partner, but together with the holders of every other series of Preferred Securities outstanding, an amount equal to, in the case of holders of Series A Preferred Securities, the aggregate of the stated S-13 liquidation preference of $25 per Series A Preferred Security and accrued and unpaid dividends thereon to the date of payment (the "Liquidation Distribution"), unless, in connection with such dissolution, winding-up or termination, Series A Junior Subordinated Debentures in an aggregate principal amount and accrued and unpaid interest equal to the Liquidation Distribution have been distributed on a pro rata basis to the holders of the Series A Preferred Securities. If, upon any such dissolution, the Liquidation Distribution can be paid only in part because PacifiCorp Delaware has insufficient assets available to pay in full the aggregate Liquidation Distribution and the aggregate maximum liquidation distributions on any other series of Preferred Securities, then the amounts payable directly by PacifiCorp Delaware on the Series A Preferred Securities and on such other series of Preferred Securities shall be paid on a pro rata basis, so that (i) the aggregate amount paid in respect of the Liquidation Distribution bears to the aggregate amount paid as liquidation distributions on the other series of Preferred Securities the same ratio as (ii) the aggregate Liquidation Distribution bears to the aggregate maximum liquidation distributions on the other series of Preferred Securities. Pursuant to the Limited Partnership Agreement, PacifiCorp Delaware shall be dissolved and its affairs shall be wound up: (i) on December 31, 2039, the expiration of the term of PacifiCorp Delaware, subject to extension for an additional 40 years by the General Partner, (ii) upon the bankruptcy of the General Partner or the assignment by the General Partner of its entire interest in PacifiCorp Delaware when the assignee is not admitted to PacifiCorp Delaware as a general partner of PacifiCorp Delaware in accordance with the Limited Partnership Agreement, or the filing of a certificate of dissolution or its equivalent with respect to the General Partner, or the revocation of the General Partner's charter and the expiration of 90 days after the date of notice to the General Partner of revocation without a reinstatement of its charter, or any other event occurs which causes the General Partner to cease to be a general partner of PacifiCorp Delaware under the Partnership Act, unless the business of PacifiCorp Delaware is continued in accordance with the Partnership Act, (iii) in accordance with the provisions of the Series A Preferred Securities, (iv) upon the entry of a decree of a judicial dissolution or (v) upon the written consent of all partners of PacifiCorp Delaware. MERGER, CONSOLIDATION OR AMALGAMATION OF PACIFICORP DELAWARE PacifiCorp Delaware may not consolidate, amalgamate, merge with or into, or be replaced by, or convey, transfer or lease its properties and assets substantially as an entirety to any corporation or other body, except as described below. PacifiCorp Delaware may, without the consent of the holders of the Series A Preferred Securities, consolidate, amalgamate, merge with or into, or be replaced by a limited liability company, limited partnership or a trust organized as such under the laws of any state of the United States of America; provided, that (i) such successor entity either (x) expressly assumes all of the obligations of PacifiCorp Delaware under the Series A Preferred Securities or (y) substitutes for the Series A Preferred Securities other securities having substantially the same terms as the Series A Preferred Securities (the "Successor Securities") so long as the Successor Securities rank, with respect to participation in the profits and dividends or in the assets of the successor entity, at least as high as the Series A Preferred Securities rank with respect to participation in the profits and dividends or in the assets of PacifiCorp Delaware, (ii) PacifiCorp expressly acknowledges such successor entity as the holder of the Series A Junior Subordinated Debentures, (iii) the Series A Preferred Securities or any Successor Securities are listed, or any Successor Securities will be listed upon notification of issuance, on any national securities exchange or other organization on which the Series A Preferred Securities are then listed, (iv) such merger, consolidation, amalgamation or replacement does not cause the Series A Preferred Securities (including any Successor Securities) to be downgraded by any nationally recognized statistical rating organization, (v) such merger, consolidation, amalgamation or replacement does not adversely affect the powers, preferences and other special rights of the holders of the Series A Preferred Securities (including any Successor Securities) in any material respect, (vi) such successor entity has a purpose substantially identical to that of PacifiCorp Delaware and (vii) prior to such merger, consolidation, amalgamation or replacement, PacifiCorp has received an opinion of nationally recognized independent counsel to PacifiCorp Delaware experienced in such matters to the effect that (x) such S-14 successor entity will be treated as a partnership for federal income tax purposes, (y) following such merger, consolidation, amalgamation or replacement, PacifiCorp and such successor entity will be in compliance with the Investment Company Act of 1940, as amended ("1940 Act") without registering thereunder as an investment company and (z) such merger, consolidation, amalgamation or replacement will not adversely affect the limited liability of the holders of the Series A Preferred Securities. ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF SERIES A PREFERRED SECURITIES Under the terms of the Series A Preferred Securities, the holders of outstanding Series A Preferred Securities will have the rights referred to under "--Voting Rights" below, including the right to appoint a Special Representative, which Special Representative shall be authorized to enforce PacifiCorp Delaware's creditor rights under the Series A Junior Subordinated Debentures and to enforce the rights of holders of Series A Preferred Securities under the Guarantee. VOTING RIGHTS Except as provided below and under "Description of the Guarantee--Amendments and Assignment" in the accompanying Prospectus and as otherwise required by law and the Limited Partnership Agreement, the holders of the Series A Preferred Securities will have no voting rights. If (i) PacifiCorp Delaware fails to pay dividends in full on the Series A Preferred Securities for 18 consecutive monthly dividend periods; (ii) an Event of Default (as defined in the Indenture) occurs and is continuing on the Series A Junior Subordinated Debentures; or (iii) PacifiCorp is in default on any of its payment or other obligations under the Guarantee (as described under "Description of the Guarantee--Certain Covenants of PacifiCorp" in the accompanying Prospectus), then the holders of the Series A Preferred Securities, together with the holders of any other series of Preferred Securities having the right to vote for the appointment of a special representative of PacifiCorp Delaware and the limited partners (a "Special Representative") in such event, acting as a single class, will be entitled by the majority vote of such holders to appoint and authorize a Special Representative to enforce PacifiCorp Delaware's creditor rights under the Series A Junior Subordinated Debentures, to enforce the rights of the holders of the Series A Preferred Securities under the Guarantee and to enforce the rights of the holders of the Series A Preferred Securities to receive dividends on the Series A Preferred Securities. The Special Representative shall not by virtue of acting in such capacity be admitted as a general partner in PacifiCorp Delaware or otherwise be deemed to be a general partner in PacifiCorp Delaware and shall have no liability for the debts, obligations or liabilities of PacifiCorp Delaware. For purposes of determining whether PacifiCorp Delaware has failed to pay dividends in full for 18 consecutive monthly dividend periods, dividends shall be deemed to remain in arrears, notwithstanding any payments in respect thereof, until full cumulative dividends have been or contemporaneously are paid with respect to all monthly dividend periods terminating on or prior to the date of payment of such full cumulative dividends. Not later than 30 days after such right to appoint a Special Representative arises, the General Partner will convene a meeting for the purpose of appointing a Special Representative. If the General Partner fails to convene such meeting within such 30-day period, the holders of 10% in liquidation preference of the outstanding Preferred Securities will be entitled to convene such meeting. The provisions of the Limited Partnership Agreement relating to the convening and conduct of the meetings of the partners will apply with respect to any such meeting. Any Special Representative so appointed shall cease to be a Special Representative of PacifiCorp Delaware and the limited partners if PacifiCorp Delaware (or PacifiCorp pursuant to the Guarantee) shall have paid in full all accrued and unpaid dividends on the Preferred Securities or such default or breach, as the case may be, shall have been cured, and PacifiCorp, in its capacity as the General Partner shall continue the business of PacifiCorp Delaware without dissolution. Notwithstanding the appointment of any such Special Representative, PacifiCorp shall continue as General Partner and shall retain all rights under the Indenture, including the right to extend the interest payment period as provided under "Description of the Series A Junior Subordinated Debentures--Option to Extend Interest Payment Period." If any proposed amendment to the Limited Partnership Agreement provides for, or the General Partner otherwise proposes to effect, (i) any action which would adversely affect the powers, preferences or special rights of the Series A Preferred Securities, whether by way of amendment to the Limited Partnership Agreement or otherwise (including, without limitation, the authorization or issuance of any S-15 limited partner interests in PacifiCorp Delaware ranking, as to participation in the profits and dividends or in the assets of PacifiCorp Delaware, senior to the Series A Preferred Securities), or (ii) the dissolution, winding-up or termination of PacifiCorp Delaware, other than (x) in connection with the distribution of Series A Junior Subordinated Debentures upon the occurrence of a Tax Event or (y) as described under "Merger, Consolidation or Amalgamation of PacifiCorp Delaware" above, then the holders of outstanding Series A Preferred Securities will be entitled to vote on such amendment or proposal of the General Partner (but not on any other amendment or proposal) as a class with all other holders of series of Preferred Securities similarly affected, and such amendment or proposal shall not be effective except with the approval of the holders of 66-2/3% in liquidation preference of such outstanding Preferred Securities having a right to vote on the matter; provided, however, that no such approval shall be required if the dissolution, winding-up or termination of PacifiCorp Delaware is proposed or initiated upon the initiation of proceedings, or after proceedings have been initiated, for the dissolution, winding-up, liquidation or termination of PacifiCorp. The rights attached to the Series A Preferred Securities will be deemed not to be adversely affected by the creation or issue of, and no vote will be required for the creation of, any further limited partner interests of PacifiCorp Delaware ranking pari passu with the Series A Preferred Securities with regard to participation in the profits and dividends or in the assets of PacifiCorp Delaware. Holders of Series A Preferred Securities have no preemptive rights. So long as any Series A Junior Subordinated Debentures are held by PacifiCorp Delaware, the General Partner shall not (i) direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or executing any trust or power conferred on the Trustee with respect to such series, (ii) waive any past default which is waivable under Section 6.06 of the Indenture, (iii) exercise any right to rescind or annul a declaration that the principal of all the Series A Junior Subordinated Debentures shall be due and payable or (iv) consent to any amendment, modification or termination of the Indenture, where such consent shall be required, without, in each case, obtaining the prior approval of the holders of at least 66-2/3% in liquidation preference of all series of Preferred Securities affected thereby, acting as a single class; provided, however, that where a consent under the Indenture would require the consent of each holder affected thereby, no such consent shall be given by the General Partner without the prior consent of each holder of all series of Preferred Securities affected thereby. The General Partner shall not revoke any action previously authorized or approved by a vote of any series of Preferred Securities. The General Partner shall notify all holders of the Series A Preferred Securities of any notice of default received from the Trustee with respect to the Series A Junior Subordinated Debentures. Any required approval of holders of Series A Preferred Securities may be given at a separate meeting of holders of Preferred Securities convened for such purpose, at a meeting of all of the partners in PacifiCorp Delaware or pursuant to written consent. PacifiCorp Delaware will cause a notice of any meeting at which holders of Series A Preferred Securities are entitled to vote, or of any matter upon which action by written consent of such holders is to be taken, to be mailed to each holder of record of Series A Preferred Securities. Each such notice will include a statement setting forth (i) the date of such meeting or the date by which such action is to be taken, (ii) a description of any resolution proposed for adoption at such meeting on which such holders are entitled to vote or of such matter upon which written consent is sought and (iii) instructions for the delivery of proxies or consents. No vote or consent of the holders of Series A Preferred Securities will be required for PacifiCorp Delaware to redeem and cancel Series A Preferred Securities in accordance with the Limited Partnership Agreement. Notwithstanding that holders of Series A Preferred Securities are entitled to vote or consent under any of the circumstances described above, any of the Series A Preferred Securities and any other series of Preferred Securities that are entitled to vote or consent with such Series A Preferred Securities as a single class at such time that are owned by PacifiCorp or any entity owned more than 50% by PacifiCorp, either directly or indirectly, shall not be entitled to vote or consent and shall, for purposes of such vote or consent, be treated as if they were not outstanding. S-16 Holders of the Series A Preferred Securities will have no rights to remove or replace the General Partner. BOOK-ENTRY-ONLY ISSUANCE--THE DEPOSITORY TRUST COMPANY DTC will act as securities depository for the Series A Preferred Securities. The Series A Preferred Securities will be issued only as fully-registered securities registered in the name of Cede & Co. (DTC's nominee). One or more fully-registered global Series A Preferred Security certificates will be issued, representing in the aggregate the total number of Series A Preferred Securities, and will be deposited with DTC. 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 17A of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). DTC holds securities that its participants ("Participants") deposit with DTC. DTC also facilitates the settlement among Participants of securities transactions, such as transfers and pledges, in deposited securities through electronic computerized book-entry changes in Participants' accounts, thereby eliminating the need for physical movement of securities certificates. Direct Participants include securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations ("Direct Participants"). DTC is owned by a number of its Direct Participants and by the New York Stock Exchange, Inc. (the "New York Stock Exchange"), the American Stock Exchange, Inc., and the National Association of Securities Dealers, Inc. Access to the DTC system is also available to others such as securities brokers and dealers, banks and trust companies that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ("Indirect Participants"). The rules applicable to DTC and its Participants are on file with the Securities and Exchange Commission. Purchases of Series A Preferred Securities within the DTC system must be made by or through Direct Participants, which will receive a credit for the Series A Preferred Securities on DTC's records. The ownership interest of each actual purchaser of each Series A Preferred Security ("Beneficial Owner") 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 purchased Series A Preferred Securities. Transfers of ownership interests in the Series A Preferred Securities 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 Series A Preferred Securities, except in the event that use of the book-entry system for the Series A Preferred Securities is discontinued. DTC has no knowledge of the actual Beneficial Owners of the Series A Preferred Securities; DTC's records reflect only the identity of the Direct Participants to whose accounts such Series A Preferred Securities are credited, which may or may not be the Beneficial Owners. The Participants will 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 will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Redemption notices shall be sent to Cede & Co. If less than all of the Series A Preferred Securities are being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such series to be redeemed. Although voting with respect to the Series A Preferred Securities is limited, in those cases where a vote is required, neither DTC nor Cede & Co. will itself consent or vote with respect to Series A Preferred Securities. Under its usual procedures, DTC would mail an Omnibus Proxy to PacifiCorp S-17 Delaware as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts the Series A Preferred Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy). Dividend payments on the Series A Preferred Securities will be made to DTC. DTC's practice is to credit Direct Participants' accounts on the relevant payment date in accordance with their respective holdings shown on DTC's records unless DTC has reason to believe that it will not receive payments on such payment date. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices and will be the responsibility of such Participant and not of DTC, PacifiCorp Delaware or PacifiCorp, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of dividends to DTC is the responsibility of PacifiCorp Delaware, disbursement of such payments to Direct Participants is the responsibility of DTC, and disbursement of such payments to the Beneficial Owners is the responsibility of Direct and Indirect Participants. DTC may discontinue providing its services as securities depository with respect to the Series A Preferred Securities at any time by giving reasonable notice to PacifiCorp Delaware. Under such circumstances, in the event that a successor securities depository is not obtained, Series A Preferred Security certificates are required to be printed and delivered. Additionally, PacifiCorp Delaware (with the consent of PacifiCorp) may decide to discontinue use of the system of book-entry transfers through DTC (or a successor depository). In that event, certificates for the Series A Preferred Securities will be printed and delivered. In each of the above circumstances, the General Partner will appoint a paying agent with respect to the Series A Preferred Securities. The information in this section concerning DTC and DTC's book-entry system has been obtained from sources that PacifiCorp Delaware and PacifiCorp believe to be reliable, but PacifiCorp Delaware and PacifiCorp take no responsibility for the accuracy thereof. REGISTRAR AND TRANSFER AGENT PacifiCorp will act as registrar and transfer agent for the Series A Preferred Securities. Registration of transfers of Series A Preferred Securities will be effected without charge by or on behalf of PacifiCorp Delaware, but upon payment (with the giving of such indemnity as PacifiCorp Delaware or PacifiCorp may require) in respect of any tax or other government charges which may be imposed in relation to it. PacifiCorp Delaware will not be required to register or cause to be registered the transfer of Series A Preferred Securities after such Series A Preferred Securities have been called for redemption. MISCELLANEOUS The General Partner is authorized and directed to conduct its affairs and to operate PacifiCorp Delaware in such a way that PacifiCorp Delaware will not be deemed to be an "investment company" required to be registered under the 1940 Act or taxed as a corporation for federal income tax purposes and so that the Series A Junior Subordinated Debentures will be treated as indebtedness of PacifiCorp for federal income tax purposes. In this connection, the General Partner is authorized to take any action, not inconsistent with applicable law, the certificate of limited partnership or the Limited Partnership Agreement, that the General Partner determines in its discretion to be necessary or desirable for such purposes, as long as such action does not adversely affect the interests of the holders of the Series A Preferred Securities. S-18 DESCRIPTION OF THE SERIES A JUNIOR SUBORDINATED DEBENTURES Set forth below is a description of the specific terms of the Series A Junior Subordinated Debentures in which PacifiCorp Delaware will invest the proceeds of the issuance and sale of (i) the Series A Preferred Securities and (ii) the General Partner's capital contribution with respect to the Series A Preferred Securities (the "General Partnership Payment"). This description supplements the description of the general terms and provisions of the Junior Subordinated Debentures set forth in the accompanying Prospectus under the caption "Description of the Junior Subordinated Debentures." The following description does not purport to be complete and is qualified in its entirety by reference to the description in the accompanying Prospectus and the Indenture, dated as of , 1994, between PacifiCorp and The Bank of New York, as Trustee, as supplemented by a First Supplemental Indenture, dated as of , 1994 (such Indenture, as so supplemented, is hereinafter referred to as the "Indenture"'). Under certain circumstances involving the dissolution of PacifiCorp Delaware following the occurrence of a Tax Event, Series A Junior Subordinated Debentures may be distributed to the holders of the Series A Preferred Securities in liquidation of PacifiCorp Delaware. See "Description of the Series A Preferred Securities--Tax Event Distribution." GENERAL The Series A Junior Subordinated Debentures will be issued as a series of unsecured Junior Subordinated Debentures under the Indenture. The Series A Junior Subordinated Debentures will be limited in aggregate principal amount to approximately $ million, such amount being the sum of the aggregate stated liquidation preference of the Series A Preferred Securities and the General Partnership Payment. The entire principal amount of the Series A Junior Subordinated Debentures will become due and payable, together with any accrued and unpaid interest thereon, including Additional Interest (as hereinafter defined), if any, on , 2034. The Series A Junior Subordinated Debentures, if distributed to holders of Series A Preferred Securities in dissolution, will initially be so issued as a Global Security (as defined below). As described herein, under certain limited circumstances Series A Junior Subordinated Debentures may be issued in certificated form in exchange for a Global Security (as defined below). See "--Book-Entry and Settlement." In the event that Series A Junior Subordinated Debentures are issued in certificated form, such Series A Junior Subordinated Debentures will be in denominations of $25 and integral multiples thereof and may be transferred or exchanged at the offices described below. Payments on Series A Junior Subordinated Debentures issued as a Global Security will be made to DTC, as the depository for the Series A Junior Subordinated Debentures. In the event Series A Junior Subordinated Debentures are issued in certificated form, principal and interest will be payable, the transfer of the Series A Junior Subordinated Debentures will be registerable and Series A Junior Subordinated Debentures will be exchangeable for Series A Junior Subordinated Debentures of other denominations of a like aggregate principal amount at the corporate trust office of the Trustee in The City of New York; provided, that payment of interest may be made at the option of PacifiCorp by check mailed to the address of the persons entitled thereto. If the Series A Junior Subordinated Debentures are distributed to the holders of Series A Preferred Securities upon the dissolution of PacifiCorp Delaware, PacifiCorp will use its best efforts to list the Series A Junior Subordinated Debentures on the New York Stock Exchange or on such other exchange as the Series A Preferred Securities are then listed and traded on the same part of any such exchange. MANDATORY PREPAYMENT If PacifiCorp Delaware redeems Series A Preferred Securities in accordance with the terms thereof, the Series A Junior Subordinated Debentures will become due and payable in a principal amount equal to the aggregate stated liquidation preference of the Series A Preferred Securities so redeemed, together S-19 with any accrued and unpaid interest, including Additional Interest (as defined below), if any. Any payment pursuant to this provision shall be made prior to 12:00 noon, New York time, on the date of such redemption or at such other time on such earlier date as the parties thereto shall agree. OPTIONAL REDEMPTION PacifiCorp shall have the right to redeem the Series A Junior Subordinated Debentures, in whole or in part, from time to time, on or after , 1999, upon not less than 30 nor more than 60 days' notice, at a redemption price equal to 100% of the principal amount to be redeemed plus any accrued and unpaid interest, including Additional Interest, if any, to the redemption date. Upon any redemption of the Series A Junior Subordinated Debentures, the proceeds from such redemption will be applied to redeem the Series A Preferred Securities, in whole or in part, upon not less than 30 nor more than 60 days' notice, at the Redemption Price. INTEREST Each Series A Junior Subordinated Debenture shall bear interest at an interest rate which will be adjusted quarterly. The rate for the initial period from the date of initial issuance to , 1994 will be % per annum. Thereafter, interest on the Series A Junior Subordinated Debentures will be payable at the "Applicable Rate" in effect from time to time. The Applicable Rate for any quarter will be equal to % of the highest of the "Treasury Bill Rate," the "Ten Year Constant Maturity Rate" and the "Thirty Year Constant Maturity Rate" determined in advance of such quarter. The Applicable Rate for any quarter will not be less than % per annum nor greater than % per anum. The "Treasury Bill Rate," the "Ten Year Constant Maturity Rate" and the "Thirty Year Constant Maturity Rate" with respect to any quarter shall be determined by PacifiCorp Delaware in the same manner as, and consistent with its determinations with respect to, quarters for the purpose of dividends payable on the Series A Preferred Securities. See "Description of the Series A Preferred Securities--Dividends." Interest on the Series A Junior Subordinated Debentures is payable monthly in arrears on the last day of each calendar month of each year (each, an "Interest Payment Date"), commencing , 1994, to the person in whose name such Series A Junior Subordinated Debenture is registered, subject to certain exceptions, at the close of business on the Business Day next preceding such Interest Payment Date. In the event the Series A Junior Subordinated Debentures shall not continue to remain in book-entry-only form, PacifiCorp shall have the right to select record dates which shall be more than one Business Day prior to the Interest Payment Date. The amount of interest payable for any period will be computed on the basis of a 360-day year of twelve 30-day months. In the event that any date on which interest is payable on the Series A Junior Subordinated Debentures is not a Business Day, then payment of the interest payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay), except that, if such Business Day is in the next succeeding calendar year, such payment shall be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such date. A "Business Day" shall mean any day other than a day on which banking institutions in The City of New York are authorized or required by law to close. OPTION TO EXTEND INTEREST PAYMENT PERIOD PacifiCorp shall have the right at any time during the term of the Series A Junior Subordinated Debentures to extend the interest payment period from time to time to a period not exceeding 60 consecutive months (the "Extension Period"), at the end of which Extension Period PacifiCorp shall pay all interest then accrued and unpaid (together with interest thereon at the rate specified for the Series A Junior Subordinated Debentures to the extent permitted by applicable law); provided, that, during any such Extension Period, PacifiCorp shall not declare or pay any dividends on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of its capital stock. Prior to the termination of any such Extension Period, PacifiCorp may further extend the interest payment period, provided that such Extension Period together with all such previous and further extensions thereof may not exceed 60 consecutive months. Upon the termination of any Extension Period and the payment of all amounts then due, PacifiCorp may select a new Extension Period, subject to the above requirements. No interest S-20 during an Extension Period, except at the end thereof, shall be due and payable. If PacifiCorp Delaware shall be the sole holder of the Series A Junior Subordinated Debentures, PacifiCorp shall give PacifiCorp Delaware notice of its selection of such Extension Period one Business Day prior to the earlier of (i) the date the dividends on the Series A Preferred Securities are payable or (ii) the date PacifiCorp Delaware is required to give notice to the New York Stock Exchange or other applicable self-regulatory organization or to holders of the Series A Preferred Securities of the record date or the date such dividend is payable, but in any event not less than one Business Day prior to such record date. PacifiCorp shall cause PacifiCorp Delaware to give notice of PacifiCorp's selection of such Extension Period to the holders of the Series A Preferred Securities. If PacifiCorp Delaware shall not be the sole holder of the Series A Junior Subordinated Debentures, PacifiCorp shall give the holders of the Series A Junior Subordinated Debentures notice of its selection of such Extension Period ten Business Days prior to the earlier of (i) the Interest Payment Date or (ii) the date PacifiCorp is required to give notice to the New York Stock Exchange or other applicable self-regulatory organization or to holders of the Series A Junior Subordinated Debentures, of the record or payment date of such related interest payment but in any event not less than three Business Days prior to such record date. ADDITIONAL INTEREST If at any time PacifiCorp Delaware shall be required to pay any interest on dividends in arrears in respect of the Series A Preferred Securities pursuant to the terms thereof, then PacifiCorp will pay as interest to PacifiCorp Delaware as the holder of the Series A Junior Subordinated Debentures ("Additional Interest") an amount equal to such interest on dividends in arrears. In addition, if PacifiCorp Delaware would be required to pay any taxes, duties, assessments or governmental charges of whatever nature (other than withholding taxes) imposed by the United States, or any other taxing authority, then, in any such case, PacifiCorp also will pay as Additional Interest such amounts as shall be required so that the net amounts received and retained by PacifiCorp Delaware after paying any such taxes, duties, assessments or governmental charges will be not less than the amounts PacifiCorp Delaware would have received had no such taxes, duties, assessments or governmental charges been imposed. SET-OFF Notwithstanding anything to the contrary in the Indenture, PacifiCorp shall have the right to set-off any payment it is otherwise required to make thereunder with and to the extent PacifiCorp has theretofore made, or is concurrently on the date of such payment making, a payment under the Guarantee. EVENTS OF DEFAULT In case any Event of Default (as defined in the Indenture) shall occur and be continuing, PacifiCorp Delaware will have the right to declare the principal of and the interest on the Series A Junior Subordinated Debentures (including any Additional Interest) and any other amounts payable under the Indenture to be forthwith due and payable and to enforce its other rights as a creditor with respect to the Series A Junior Subordinated Debentures. ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF SERIES A PREFERRED STOCK Under the terms of the Series A Preferred Securities, the holders of outstanding Series A Preferred Securities will have the rights referred to under "Description of the Series A Preferred Securities--Voting Rights," including the right to appoint a Special Representative, which Special Representative shall be authorized to exercise PacifiCorp Delaware's right to accelerate the principal amount of the Series A Junior Subordinated Debentures if any Event of Default shall occur and be continuing, to enforce S-21 PacifiCorp Delaware's other creditor rights under the Series A Junior Subordinated Debentures and to enforce the rights of holders of Series A Preferred Securities under the Guarantee. BOOK-ENTRY AND SETTLEMENT If distributed to holders of Series A Preferred Securities in connection with the dissolution of PacifiCorp Delaware as a result of the occurrence of a Tax Event, the Series A Junior Subordinated Debentures will be issued in the form of one or more global certificates (each, a "Global Security") registered in the name of the nominee of DTC. Except under the limited circumstances described below, Series A Junior Subordinated Debentures represented by the Global Security will not be exchangeable for, and will not otherwise be issuable as, Series A Junior Subordinated Debentures in definitive form. The Global Securities described above may not be transferred except by DTC to a nominee of DTC or by a nominee of DTC to DTC or another nominee of DTC or to a successor depository or its nominee. The laws of some jurisdictions require that certain purchasers of securities take physical delivery of such securities in definitive form. Such laws may impair the ability to transfer beneficial interests in such a Global Security. Except as provided below, owners of beneficial interests in such a Global Security will not be entitled to receive physical delivery of Series A Junior Subordinated Debentures in definitive form and will not be considered the Holders (as defined in the Indenture) thereof for any purpose under the Indenture, and no Global Security representing Series A Junior Subordinated Debentures shall be exchangeable, except for another Global Security of like denomination and tenor to be registered in the name of DTC or its nominee or to a successor depository or its nominee. Accordingly, each beneficial owner must rely on the procedures of DTC and, if such person is not a Participant, on the procedures of the Participant through which such person owns its interest, to exercise any rights of a Holder under the Indenture. THE DEPOSITORY. DTC will act as security depository for the Series A Junior Subordinated Debentures. For a description of DTC and the specific terms of the depository arrangements, see "Description of the Series A Preferred Securities-- Book-Entry-Only Issuance--The Depository Trust Company." As of the date of this Prospectus Supplement, the description therein of DTC's book-entry system and DTC's practices as they relate to purchases, transfers, notices and payments with respect to the Series A Preferred Securities apply in all material respects to any debt obligations represented by one or more Global Securities held by DTC. Neither PacifiCorp, the Trustee, any paying agent nor any other agent of PacifiCorp or the Trustee will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests in a Global Security for such Series A Junior Subordinated Debentures or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests. DISCONTINUANCE OF THE DEPOSITORY'S SERVICES. A Global Security shall be exchangeable for Series A Junior Subordinated Debentures registered in the names of persons other than DTC or its nominee only if (i) DTC notifies PacifiCorp that it is unwilling or unable to continue as a depository for such Global Security and no successor depository shall have been appointed, or if any time DTC ceases to be a clearing agency registered under the Exchange Act at a time when DTC is required to be so registered to act as such depository, (ii) PacifiCorp in its sole discretion determines that such Global Security shall be so exchangeable or (iii) there shall have occurred an Event of Default with respect to such Series A Junior Subordinated Debentures. Any Global Security that is exchangeable pursuant to the preceding sentence shall be exchangeable for Series A Junior Subordinated Debentures registered in such names as the Depository shall direct. It is expected that such instructions will be based upon directions received by the Depository from its Participants with respect to ownership of beneficial interests in such Global Security. MISCELLANEOUS For restrictions on certain actions of the General Partner with respect to Series A Junior Subordinated Debentures held by PacifiCorp Delaware, see "Description of the Series A Preferred Securities--Voting Rights." S-22 UNITED STATES TAXATION GENERAL This section is a summary of certain United States federal income tax considerations that may be relevant to prospective purchasers of Series A Preferred Securities and represents the opinion of Stoel Rives Boley Jones & Grey, counsel to PacifiCorp and PacifiCorp Delaware, insofar as it relates to matters of law and legal conclusions. This section is based upon current provisions of the Internal Revenue Code of 1986, as amended (the "Code"), existing and proposed regulations thereunder and current administrative rulings and court decisions, all of which are subject to change. Subsequent changes may cause tax consequences to vary substantially from the consequences described below. No attempt has been made in the following discussion to comment on all United States federal income tax matters affecting purchasers of Series A Preferred Securities. Moreover, the discussion focuses on holders of Series A Preferred Securities who are individual citizens or residents of the United States that hold the Series A Preferred Securities as a capital asset and has only limited application to corporations, estates, trusts or non-resident aliens. Accordingly, each prospective purchaser of Series A Preferred Securities should consult, and should depend on, his or her own tax advisor in analyzing the federal, state, local and foreign tax consequences of the purchase, ownership or disposition of Series A Preferred Securities. INCOME FROM SERIES A PREFERRED SECURITIES In the opinion of Stoel Rives Boley Jones & Grey, PacifiCorp Delaware will be a partnership for federal income tax purposes. Accordingly, each holder of Series A Preferred Securities will be required to include in gross income such holder's distributive share of the net income of PacifiCorp Delaware. Such income will not exceed the dividends received on such Series A Preferred Securities, except in limited circumstances as described below under "Potential Extension of Interest Payment Period." No portion of such income will be eligible for the dividends received deduction. DISPOSITION OF SERIES A PREFERRED SECURITIES Gain or loss will be recognized on a sale, exchange or other disposition of Series A Preferred Securities, including a redemption for cash, equal to the difference between the amount realized and the holder's tax basis for the Series A Preferred Securities sold. Gain or loss recognized by a holder on the sale or exchange of a Series A Preferred Security held for more than one year will generally be taxable as long-term capital gain or loss. RECEIPT OF SERIES A JUNIOR SUBORDINATED DEBENTURES UPON LIQUIDATION OF PACIFICORP DELAWARE Under certain circumstances, as described under the caption "Description of the Series A Preferred Securities--Tax Event Distribution", Series A Junior Subordinated Debentures may be distributed to the holders of the Series A Preferred Securities in liquidation of PacifiCorp Delaware. Under current United States federal income tax law, such a distribution would be treated as a non-taxable exchange to each holder of Series A Preferred Securities and would result in the holder of Series A Preferred Securities receiving an aggregate tax basis in the Series A Junior Subordinated Debentures equal to such holder's aggregate tax basis in its Series A Preferred Securities. A holder's holding period in the Series A Junior Subordinated Debentures so received in liquidation of PacifiCorp Delaware would include the period for which the Series A Preferred Securities were held by such holder. As a condition to the dissolution of PacifiCorp Delaware and such a distribution, PacifiCorp Delaware will be required to obtain an opinion of counsel (which may be regular tax counsel to PacifiCorp or an affiliate, but not an employee thereof) to the effect that the holders of the Series A Preferred Securities will not recognize any gain or loss for federal income tax purposes as a result of such dissolution and distribution of Series A Junior Subordinated Debentures. S-23 PACIFICORP DELAWARE INFORMATION RETURNS AND AUDIT PROCEDURES PacifiCorp, as the General Partner of PacifiCorp Delaware, will furnish each holder of Series A Preferred Securities with a Schedule K-1 each year setting forth such holder's allocable share of income for the prior calendar year. PacifiCorp is required to furnish such Schedule K-1 as soon as practicable following the end of the year, but in any event prior to March 31. Any person who holds Series A Preferred Securities as a nominee for another person is required to furnish to PacifiCorp Delaware (a) the name, address and taxpayer identification number of the Beneficial Owner and the nominee; (b) information as to whether the Beneficial Owner is (i) a person that is not a United States person, (ii) a foreign government, an international organization or any wholly-owned agency or instrumentality of either of the foregoing, or (iii) a tax-exempt entity; (c) the amount and description of Series A Preferred Securities held, acquired or transferred for the Beneficial Owner; and (d) certain information including the dates of acquisitions and transfers, means of acquisitions and transfers, and acquisition cost for purchases, as well as the amount of net proceeds from sales. Brokers and financial institutions are required to furnish additional information, including whether they are United States persons and certain information on Series A Preferred Securities they acquire, hold or transfer for their own accounts. A penalty of $50 per failure (up to a maximum of $100,000 per calendar year) is imposed by the Code for failure to report such information to PacifiCorp Delaware. The nominee is required to supply the Beneficial Owners of the Series A Preferred Securities with the information furnished to PacifiCorp Delaware. POTENTIAL EXTENSION OF INTEREST PAYMENT PERIOD Under the Indenture, PacifiCorp has the right to extend from time to time the interest payment period on the Series A Junior Subordinated Debentures to a period not exceeding 60 consecutive months. Because the interest payment period is extendable by PacifiCorp, the interest on the Series A Junior Subordinated Debentures will be treated as "original issue discount" pursuant to Code sections 1271 et seq. and the Treasury Regulations promulgated thereunder. PacifiCorp Delaware will therefore be required, during any Extension Period, to include in gross income the interest on the Series A Junior Subordinated Debentures as it accrues in accordance with a constant yield method (notwithstanding that no cash payments will be made during an Extension Period). Likewise, regardless of its regular method of accounting for tax purposes, each holder of Series A Junior Subordinated Debentures (after a dissolution of PacifiCorp Delaware) will be required, during any Extension Period, to include in income the interest on the Series A Junior Subordinated Debentures as it accrues in accordance with such method. Accrued income of PacifiCorp Delaware will be allocated, but not distributed, to holders of record on the Business Day preceding the last day of each calendar month. As a result, holders of record during an Extension Period or any other nonpayment period will include interest in gross income in advance of the receipt of cash, and any such holders who dispose of Series A Preferred Securities prior to the record date for the payment of dividends following such Extension Period or other nonpayment period will include interest in gross income but will not receive any cash related thereto from PacifiCorp Delaware. A holder's tax basis in a Series A Preferred Security will be increased by the amount of any interest that is included in income without the receipt of cash, and will be decreased again when and if such cash is subsequently received from PacifiCorp Delaware. UNITED STATES ALIEN HOLDERS For purposes of the following discussion, a "United States Alien Holder" is any holder that is (i) a nonresident alien individual, (ii) a foreign corporation or partnership or (iii) an estate or trust that has a foreign fiduciary, in each case not subject to United States federal income tax on a net income basis in respect of a Series A Preferred Security. Under current United States federal income tax law, subject to the discussion below with respect to backup withholding: (i) Payments by PacifiCorp Delaware or any of its paying agents in respect of a Series A Preferred Security to a United States Alien Holder will not be subject to United States federal withholding tax provided that (a) the Beneficial Owner of the Series A Preferred Security does not S-24 actually or constructively own 10% or more of the total combined voting power of all classes of capital stock of PacifiCorp entitled to vote, (b) the Beneficial Owner of the Series A Preferred Security is not a controlled foreign corporation that is related to PacifiCorp through stock ownership and (c) the Beneficial Owner provides the correct certification of United States Alien Holder status (which may generally be satisfied by providing an IRS Form W-8 certifying that the Beneficial Owner is a United States Alien Holder and providing the name and address of the Beneficial Owner); and (ii) A United States Alien Holder will not be subject to United States federal withholding tax and generally will not be subject to United States federal income tax on gain realized from the sale or exchange of a Series A Preferred Security. Under certain conditions, a United States Alien Holder may be subject to United States federal income tax on gain or income received with respect to the sale or exchange of a Series A Preferred Security. Such income taxation may occur, for example, if the United States Alien Holder (a) is engaged in a trade or business in the United States and gain or income is effectively connected with the conduct of that trade or business or (b) is an individual present in the United States for 183 days or more during the taxable year, and certain other conditions are met. Such taxation is beyond the scope of this summary and should be discussed with a tax advisor. If income is effectively connected with the conduct of a trade or business in the United States by a United States Alien Holder, withholding of United States federal income tax may be required unless the United States Alien Holder files with PacifiCorp Delaware or its paying agent an IRS form to the effect that the income is so effectively connected. If the Series A Junior Subordinated Debentures were not treated as debt, or if Pacificorp Delaware were not treated as a partnership, for United States federal income tax purposes, United States Alien Holders could experience tax consequences different from those currently anticipated, including consequences related to withholding on payment and United States estate tax consequences. BACKUP WITHHOLDING AND INFORMATION REPORTING In general, information reporting requirements will apply to payments to noncorporate United States holders of the proceeds of the sale of Series A Preferred Securities within the United States and "backup withholding" at a rate of 31% will apply to such payments if the United States holder fails to provide an accurate taxpayer identification number. In general, information reporting requirements will also apply to payments of principal and interest on a Series A Junior Subordinated Debenture distributed to a holder of Series A Preferred Securities, and the proceeds of the sale of a Series A Junior Subordinated Debenture prior to maturity within the United States, with respect to non-corporate United States Holders, and "backup withholding" at a rate of 31% will apply to such payments if the United States Holder fails to provide an accurate taxpayer identification number or to report all interest and dividends required to be shown on its federal income tax returns. Information reporting and backup withholding will not apply to payments of principal and interest made by PacifiCorp or a paying agent to a United States Alien Holder on a Series A Junior Subordinated Debenture distributed to a holder of Series A Preferred Securities if the certification described in clause (i)(c) under "United States Alien Holders" above is received, provided that the payor does not have actual knowledge that the holder is a United States Holder. Payments of the proceeds from the sale by a United States Alien Holder of Series A Preferred Securities or Series A Junior Subordinated Debentures distributed to such a holder made to or through a foreign office of a broker generally will not be subject to information reporting or backup withholding, except that, if the broker is a United States person, a controlled foreign corporation for United States tax purposes, or a foreign person 50% or more of whose gross income is effectively connected with a United States trade or business for a specified three-year period, information reporting may apply to such payments. Payments of the proceeds from the sale of Series A Preferred Securities or Series A Junior Subordinated Debentures distributed to a holder of Series A Preferred Securities to or through the United States office of a broker is subject to information reporting and backup withholding unless the holder or beneficial owner certifies as to its non-United States status or otherwise establishes an exemption from information reporting and backup withholding. S-25 UNDERWRITING Subject to the terms and conditions of the Underwriting Agreement, PacifiCorp Delaware has agreed to sell to each of the Underwriters named below, and each of the Underwriters, for whom Goldman, Sachs & Co., Smith Barney Inc. and are acting as Representatives (the "Representatives"), has severally agreed to purchase from PacifiCorp Delaware the respective number of Series A Preferred Securities set forth opposite its name below: Number of Preferred Underwriter Securities ----------- ---------- Goldman, Sachs & Co. . . . . . . . . Smith Barney Inc.. . . . . . . . . . ---------- Total . . . . . . . . . . . . .========== The Underwriters propose to offer the Series A Preferred Securities in part directly to the public at the initial public offering price set forth on the cover page of this Prospectus Supplement, and in part to certain securities dealers at such price less a concession of $ per Series A Preferred Security. The Underwriters may allow, and such dealers may reallow, a concession not in excess of $ per Series A Preferred Security to certain brokers and dealers. After the Series A Preferred Securities are released for sale to the public, the offering price and other selling terms may from time to time be varied by the Representatives. Because the proceeds of the sale of the Series A Preferred Securities will ultimately be used to purchase the Series A Junior Subordinated Debentures, the Underwriting Agreement provides that PacifiCorp will pay an amount equal to $ per Series A Preferred Security ($ per Series A Preferred Security sold to certain institutions) for the accounts of the several Underwriters. PacifiCorp and PacifiCorp Delaware have agreed, during the period beginning from the date of the Underwriting Agreement and continuing to and including 30 days after the closing date, not to offer, sell, contract to sell, or otherwise dispose of any Series A Preferred Securities, any limited partnership interests of PacifiCorp Delaware, or any preferred stock or any other securities of PacifiCorp Delaware or PacifiCorp that are substantially similar to the Series A Preferred Securities, or any securities convertible into or exchangeable for Series A Preferred Securities, limited partnership interests, preferred stock or such substantially similar securities of either PacifiCorp Delaware or PacifiCorp, without the prior written consent of the Underwriters. Prior to this offering, there has been no public market for the Series A Preferred Securities. Application will be made to list the Series A Preferred Securities on the New York Stock Exchange. In order to meet one of the requirements for listing the Series A Preferred Securities on the New York Stock Exchange, the Underwriters will undertake to sell lots of 100 or more Series A Preferred Securities to a minimum of 400 beneficial holders. PacifiCorp Delaware and PacifiCorp have agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended, or to have PacifiCorp and PacifiCorp Delaware contribute to payments such Underwriters may be required to make on respect thereof. Certain of the Underwriters engage in transactions with, and from time to time have performed services for, PacifiCorp and its subsidiaries in the ordinary course of business. S-26 LEGAL MATTERS Certain matters of Delaware law relating to the validity of the Series A Preferred Securities, the validity of the Limited Partnership Agreement and the formation of PacifiCorp Delaware are being passed upon by Richards, Layton & Finger, P.A., special Delaware counsel to PacifiCorp and PacifiCorp Delaware. The validity of the Indenture, the Guarantee and the Series A Junior Subordinated Debentures will be passed upon on behalf of PacifiCorp Delaware and PacifiCorp by Stoel Rives Boley Jones & Grey, Portland, Oregon, and on behalf of the Underwriters by Winthrop, Stimson, Putnam & Roberts, New York, New York. Stoel Rives Boley Jones & Grey and Winthrop, Stimson, Putnam & Roberts may rely on Richards, Layton & Finger, P.A. as to certain matters of Delaware law. Statements as to United States taxation in the Prospectus Supplement under the caption "United States Taxation" have been passed upon for PacifiCorp and PacifiCorp Delaware by Stoel Rives Boley Jones & Grey and are stated herein on their authority. S-27 =============================================================== NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES DESCRIBED IN THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY SUCH SECURITIES IN ANY CIRCUMSTANCE IN WHICH SUCH OFFER OR SOLICITATION IS UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN OR THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH INFORMATION. ____________________ TABLE OF CONTENTS PROSPECTUS SUPPLEMENT PacifiCorp Delaware. . . . . . . . . . . . . . . . . . . . . . S-3 PacifiCorp . . . . . . . . . . . . . . . . . . . . . . . . . . S-3 Investment Considerations. . . . . . . . . . . . . . . . . . . S-4 Selected Financial Information . . . . . . . . . . . . . . . . S-6 Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . S-6 Description of the Series A Preferred Securities . . . . . . . . . . . . . . . . . . . . S-7 Description of the Series A Junior Subordinated Debentures . . . . . . . . . . . . . . . S-18 United States Taxation . . . . . . . . . . . . . . . . . . . . S-22 Underwriting . . . . . . . . . . . . . . . . . . . . . . . . . S-25 Legal Matters. . . . . . . . . . . . . . . . . . . . . . . . . S-26 PROSPECTUS Available Information. . . . . . . . . . . . . . . . . . . . . 2 Incorporation of Certain Documents by Reference . . . . . . . . . . . . . . . . . . . 2 PacifiCorp . . . . . . . . . . . . . . . . . . . . . . . . . . 3 PacifiCorp Delaware, L.P.. . . . . . . . . . . . . . . . . . . 3 Consolidated Ratios of Earnings to Fixed Charges . . . . . . . . . . . . . . . . . . . . . . 4 Consolidated Ratios of Earnings to Combined Fixed Charges and Preferred Stock Dividends. . . . . . . . . . . . . . . . . . . . . . . 4 Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . 4 Description of the Junior Subordinated Debentures. . . . . . . . . . . . . . . . . . . 4 Description of the Preferred Securities. . . . . . . . . . . . 10 Description of the Guarantee . . . . . . . . . . . . . . . . . 11 Plan of Distribution . . . . . . . . . . . . . . . . . . . . . 13 Experts. . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Legal Opinions . . . . . . . . . . . . . . . . . . . . . . . . 14 =============================================================== S-27 =============================================================== _____ PREFERRED SECURITIES, PACIFICORP DELAWARE GUARANTEED TO THE EXTENT SET FORTH HEREUNDER BY PACIFICORP CUMULATIVE ADJUSTABLE RATE MONTHLY INCOME PREFERRED SECURITIES SERIES A -------------------- PROSPECTUS SUPPLEMENT -------------------- GOLDMAN, SACHS & CO. SMITH BARNEY INC. =============================================================== SUBJECT TO COMPLETION, DATED OCTOBER __, 1994 $150,000,000 PACIFICORP JUNIOR SUBORDINATED DEBENTURES PACIFICORP DELAWARE PREFERRED SECURITIES GUARANTEED TO THE EXTENT SET FORTH HEREIN BY PACIFICORP ____________________ PacifiCorp, an Oregon corporation ("PacifiCorp"), may from time to time offer its deferrable interest junior subordinated debentures (the "Junior Subordinated Debentures") in one or more series and in amounts, at prices and on terms to be determined at the time of the offering. The Junior Subordinated Debentures when issued will be unsecured and subordinate and junior in right of payment to Senior Indebtedness (as defined herein) of PacifiCorp. See "Description of the Junior Subordinated Debentures." PacifiCorp Delaware, L.P. ("PacifiCorp Delaware"), a Delaware special purpose limited partnership in which PacifiCorp is the general partner, may offer, from time to time, its preferred securities, representing limited partner interests (the "Preferred Securities"), in one or more series. The payment of periodic cash distributions ("dividends") with respect to Preferred Securities of any series, out of moneys held by PacifiCorp Delaware, and payments on liquidation or redemption with respect to the Preferred Securities are guaranteed by PacifiCorp to the extent described herein (the "Guarantee"). PacifiCorp's obligations under the Guarantee are subordinate and junior in right of payment to all other liabilities of PacifiCorp and pari passu with the most senior preferred stock issued by PacifiCorp. Junior Subordinated Debentures also may be issued and sold from time to time in one or more series by PacifiCorp to PacifiCorp Delaware in connection with the investment of the proceeds from the offering of Preferred Securities. The Junior Subordinated Debentures subsequently may be distributed pro rata to holders of Preferred Securities in connection with the dissolution of PacifiCorp Delaware upon the occurrence of certain events as may be described in an accompanying Prospectus Supplement (the "Prospectus Supplement"). Specific terms of the particular Junior Subordinated Debentures and Preferred Securities of any series in respect of which this Prospectus is being delivered (the "Offered Securities") will be set forth in an accompanying Prospectus Supplement with respect to such series, which will describe, without limitation and where applicable, the following: (i) in the case of Junior Subordinated Debentures, the specific designation, aggregate principal amount, denomination, maturity, premium, if any, interest rate or rates (or the method of determining such rate or rates), if any, dates on which premium, if any, and interest will be payable, any redemption provisions, any sinking fund provisions, the initial public offering price, any listing on a securities exchange and any other terms and (ii) in the case of Preferred Securities, the specific designation, number of Preferred Securities, dividend rate or rates (or the method of determining such rate or rates), dates on which dividends will be payable, liquidation preference, voting rights, any redemption provisions, terms for any conversion or exchange into other securities, the initial public offering price, any listing on a securities exchange, and any other rights, preferences, privileges, limitations and restrictions. The Offered Securities may be offered in amounts, at prices and on terms to be determined at the time of offering; provided, however, that the aggregate initial public offering price of all Offered Securities shall not exceed $150,000,000. The Prospectus Supplement relating to any series of Offered Securities will contain information concerning certain United States federal income tax considerations, if applicable to the Offered Securities. ___________________________ THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ___________________________ The Offered Securities will be sold directly, through agents, underwriters or dealers as designated from time to time, or through a combination of such methods. If any agents, dealers or underwriters are involved in the sale of the Offered Securities in respect of which this Prospectus is being delivered, the names of such agents, dealers or underwriters and any applicable commissions or discounts will be set forth in or may be calculated from the Prospectus Supplement with respect to such Offered Securities. See "Plan of Distribution." THE DATE OF THIS PROSPECTUS IS , 1994. INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH JURISDICTION. AVAILABLE INFORMATION PacifiCorp is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files reports and other information with the Securities and Exchange Commission (the "Commission"). Such reports and other information (including proxy and information statements) filed by PacifiCorp can be inspected and copied at public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at the following Regional Offices of the Commission: New York Regional Office, 7 World Trade Center, 13th Floor, New York, New York 10046, and Chicago Regional Office, 500 W. Madison Street, 14th Floor, Chicago, Illinois 60661. Copies of such material can be obtained from the Public Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, upon payment of the prescribed rates. The Common Stock of PacifiCorp is listed on the New York and Pacific Stock Exchanges. Reports, proxy statements and other information concerning PacifiCorp can be inspected at their respective offices: New York Stock Exchange, 20 Broad Street, New York, New York 10005, and Pacific Stock Exchange, 301 Pine Street, San Francisco, California. PacifiCorp Delaware and PacifiCorp have filed with the Commission a joint Registration Statement under the Securities Act of 1933, as amended (the "Securities Act"), with respect to the securities offered hereby. This Prospectus does not contain all of the information set forth in the Registration Statement and the exhibits thereto. For further information with respect to PacifiCorp, PacifiCorp Delaware and the Offered Securities, reference is hereby made to such Registration Statement, including the exhibits thereto, which may be examined at the Commission's principal office, 450 Fifth Street, N.W., Washington, D.C. 20549, or copies of which may be obtained from the Commission at such office upon payment of the fees prescribed by the Commission. No separate financial statements of PacifiCorp Delaware have been included herein. PacifiCorp and PacifiCorp Delaware do not consider that such financial statements would be material to holders of Preferred Securities offered hereby because PacifiCorp Delaware is a newly formed special purpose entity, has no operating history, has no independent operations and is not engaged in, and does not propose to engage in, any activity other than as set forth below. PacifiCorp Delaware is a limited partnership formed under the laws of the State of Delaware. PacifiCorp is the sole general partner of PacifiCorp Delaware and, as of the date hereof, directly or indirectly beneficially owns all of PacifiCorp Delaware's partnership interests. See "PacifiCorp Delaware, L.P." INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents filed by PacifiCorp with the Commission pursuant to the Exchange Act are incorporated in this Prospectus by reference: (1) PacifiCorp's Annual Report on Form 10-K for the year ended December 31, 1993 (as amended by Form 10-K/A dated June 7, 1994); (2) PacifiCorp's Quarterly Reports on Form 10-Q for the quarters ended March 31, 1994 and June 30, 1994; and (3) PacifiCorp's Current Reports on Form 8-K dated January 18 and May 24, 1994. All documents filed by PacifiCorp pursuant to Section 13, 14 or 15(d) of the Exchange Act after the date of this Prospectus and prior to the termination of this offering shall be deemed to be incorporated by reference in this Prospectus and to be a part hereof from the date of filing of such documents (such documents, and the documents enumerated above, being hereinafter referred to as "Incorporated Documents"; provided, however, that all documents filed by PacifiCorp pursuant to Section 13 or 14 of the Exchange Act in each year during which the offering made by this Prospectus is in effect prior to the filing with the Commission of PacifiCorp's Annual Report on Form 10-K covering such year shall not be Incorporated Documents or be incorporated by reference in this Prospectus or be a part hereof from and after such filing of such Annual Report on Form 10-K). Any statement contained in an Incorporated Document shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein or in any other 2 subsequently filed Incorporated Document modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. PACIFICORP HEREBY UNDERTAKES TO PROVIDE WITHOUT CHARGE TO EACH PERSON TO WHOM A COPY OF THIS PROSPECTUS HAS BEEN DELIVERED, ON THE WRITTEN OR ORAL REQUEST OF ANY SUCH PERSON, A COPY OF ANY OR ALL OF THE INCORPORATED DOCUMENTS, OTHER THAN EXHIBITS TO SUCH DOCUMENTS, UNLESS SUCH EXHIBITS ARE SPECIFICALLY INCORPORATED BY REFERENCE THEREIN. REQUESTS SHOULD BE DIRECTED TO RICHARD T. O'BRIEN, VICE PRESIDENT, PACIFICORP, 700 NE MULTNOMAH, SUITE 1600, PORTLAND, OREGON 97232, TELEPHONE NUMBER (503) 731-2000. THE INFORMATION RELATING TO PACIFICORP CONTAINED IN THIS PROSPECTUS DOES NOT PURPORT TO BE COMPREHENSIVE AND SHOULD BE READ TOGETHER WITH THE INFORMATION CONTAINED IN THE INCORPORATED DOCUMENTS. NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY PACIFICORP DELAWARE OR PACIFICORP. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION. NEITHER THE DELIVERY OF THIS PROSPECTUS AND THE PROSPECTUS SUPPLEMENT NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF PACIFICORP OR ITS SUBSIDIARIES SINCE THE DATE OF THIS PROSPECTUS OR THE PROSPECTUS SUPPLEMENT, AS THE CASE MAY BE. PACIFICORP PacifiCorp is an electric utility that conducts a retail electric utility business through two divisions, Pacific Power & Light Company ("Pacific Power") and Utah Power & Light Company ("Utah Power"), and engages in power production and sales on a wholesale basis under the name PacifiCorp. PacifiCorp is the indirect owner, through PacifiCorp Holdings, Inc. (a wholly- owned subsidiary), of 87% of Pacific Telecom, Inc. ("Pacific Telecom") and 100% of PacifiCorp Financial Services, Inc. ("PFS"). Pacific Power and Utah Power furnish electric service in portions of seven western states: California, Idaho, Montana, Oregon, Utah, Washington, and Wyoming. Pacific Telecom, through its subsidiaries, provides local telephone service and access to the long distance network in Alaska, seven other western states and three midwestern states, provides intrastate and interstate long distance communication services in Alaska, provides cellular mobile telephone services, and is engaged in sales of capacity in and operation of a submarine fiber optic cable between the United States and Japan. PFS plans to sell substantial portions of its loan, leasing and real estate investments over the next several years. The principal executive offices of PacifiCorp are located at 700 NE Multnomah, Suite 1600, Portland, Oregon 97232; the telephone number is (503) 731-2000. PACIFICORP DELAWARE, L.P. PacifiCorp Delaware is a limited partnership formed under the laws of the State of Delaware. PacifiCorp Delaware exists for the sole purpose of issuing its limited partnership interests and investing the net proceeds thereof in Junior Subordinated Debentures. Such Junior Subordinated Debentures will be the only assets of PacifiCorp Delaware and the only revenues of PacifiCorp Delaware will be the interest on such Junior Subordinated Debentures. PacifiCorp is the sole general partner in PacifiCorp Delaware (the "General Partner"). PacifiCorp Preferred Capital, Inc., a Delaware corporation and a wholly owned subsidiary of PacifiCorp, is, as of the date hereof, the sole limited partner in PacifiCorp Delaware. Upon the issuance of Preferred Securities, which securities represent limited partner interests in PacifiCorp Delaware, PacifiCorp Preferred Capital, Inc. will remain as a limited partner, but will have no interest in the profits and dividends or in the assets of PacifiCorp Delaware. PacifiCorp Delaware has a term of approximately 45 years, subject to extension by the General Partner for an additional 40 years, unless earlier dissolved. PacifiCorp Delaware's registered office in the State of 3 Delaware is c/o The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington, New Castle County, Delaware 19801, telephone: (302) 658-7581. All of PacifiCorp Delaware's business and affairs will be conducted by PacifiCorp, as the sole general partner. The principal place of business of PacifiCorp Delaware is c/o PacifiCorp, 700 NE Multnomah, Suite 1600, Portland, Oregon 97232, telephone number (503) 731-2000. CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES The ratios of earnings to fixed charges of PacifiCorp for the years ended December 31, 1989 through 1993 and for the six months ended June 30, 1994 calculated as required by the Commission, are 2.3x, 2.3x, 2.4x, 1.6x, 2.5x and 2.8x respectively. Excluding the effect of special charges, the ratio was 1.9x for the year 1992. For the purpose of computing such ratios, "earnings" represents 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 losses (income) of less than 50% owned affiliates without loan guarantees. "Fixed charges" represents consolidated interest charges, an estimated amount representing the interest factor in rents and preferred stock dividend requirements of majority-owned subsidiaries, and excludes discontinued operations. CONSOLIDATED RATIOS OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS The ratios of earnings to combined fixed charges and preferred stock dividends of PacifiCorp for the years ended December 31, 1989 through 1993 and for the six months ended June 30, 1994, calculated as required by the Commission, are 2.1x, 2.2x, 2.2x, 1.4x, 2.2x and 2.4x, respectively. Excluding the effect of special charges, the ratio was 1.8x for the year 1992. For the purpose of computing such ratios, "earnings" represents the aggregate of (i) income from continuing operations, (ii) taxes based on income from continuing operations, (iii) minority interest in the income of majority-owned subsidiaries that have fixed charges, (iv) fixed charges and (v) undistributed losses (income) of less than 50% owned affiliates without loan guarantees. "Fixed charges" represents consolidated interest charges, an estimated amount representing the interest factor in rents and preferred stock dividend requirements of majority-owned subsidiaries, and excludes discontinued operations. "Preferred stock dividends" represents preferred dividend requirements multiplied by the ratio which pre-tax income from continuing operations bears to income from continuing operations. USE OF PROCEEDS Unless otherwise specified in the Prospectus Supplement, the net proceeds to be received by PacifiCorp from the sale of Junior Subordinated Debentures will become part of the general funds of PacifiCorp and will be used to repay its short-term borrowings and for other corporate purposes. Reference is made to the Incorporated Documents with respect to PacifiCorp's capital requirements and its general financing plans. PacifiCorp Delaware will invest all proceeds received from the sale of Preferred Securities in Junior Subordinated Debentures. DESCRIPTION OF THE JUNIOR SUBORDINATED DEBENTURES Junior Subordinated Debentures may be issued from time to time in one or more series under an Indenture, dated as of , 1994 (the "Indenture"), between PacifiCorp and The Bank of New York, as Trustee (the "Trustee"). PacifiCorp may issue the Junior Subordinated Debentures to the public or to institutional investors as described under "Plan of Distribution" or to PacifiCorp Delaware in connection with the issuance of Preferred Securities. The following summary does not purport to be complete and is subject in all respects to the provisions of and is qualified in its entirety by reference to, the Indenture, which is filed as an exhibit to the Registration Statement of which this Prospectus forms a part. Whenever particular provisions or defined terms in the Indenture are referred to herein, such provisions or defined terms are incorporated by reference herein. Section and Article references used herein are references to provisions of the Indenture unless otherwise noted. 4 GENERAL The Junior Subordinated Debentures will be unsecured, subordinated obligations of PacifiCorp. The Indenture does not limit the aggregate principal amount of Junior Subordinated Debentures which may be issued thereunder and provides that the Junior Subordinated Debentures may be issued thereunder from time to time in one or more series. PacifiCorp's Second Restated Articles of Incorporation, as amended (the "Articles"), limit the amount of unsecured debt that PacifiCorp may issue to the equivalent of 30% of the total of all secured indebtedness and total equity. Under this provision, approximately $1.16 billion of additional unsecured debt could have been issued as of June 30, 1994. The Junior Subordinated Debentures are issuable in one or more series pursuant to an indenture supplemental to the Indenture or a resolution of PacifiCorp's Board of Directors (each, a "Supplemental Indenture") (Section 2.01). The aggregate principal amount of Junior Subordinated Debentures relating to Preferred Securities of any series will be set forth in the Prospectus Supplement for such series. With respect to any issuance of Junior Subordinated Debentures to PacifiCorp Delaware in connection with the issuance of Preferred Securities, the aggregate principal amount of the Junior Subordinated Debentures will be equal to the sum of the aggregate liquidation preference of the Preferred Securities for such series and the General Partner's capital contribution with respect to the Preferred Securities for such series. Junior Subordinated Debentures relating to Preferred Securities of any series subsequently may be distributed pro rata to holders of Preferred Securities of such series in connection with the dissolution of PacifiCorp Delaware upon the occurrence of certain events described in the Prospectus Supplement relating to the Preferred Securities of such series. Reference is made to the Prospectus Supplement which will accompany this Prospectus for the following terms of the series of Junior Subordinated Debentures being offered thereby: (i) the specific title of such Junior Subordinated Debentures; (ii) any limit on the aggregate principal amount of such Junior Subordinated Debentures; (iii) the date or dates on which the principal of such Junior Subordinated Debentures is payable; (iv) the rate or rates at which such Junior Subordinated Debentures will bear interest or the manner of calculation of such rate or rates; (v) the date or dates from which such interest shall accrue, the interest payment dates on which such interest will be payable or the manner of determination of such interest payment dates and the record dates for the determination of holders to whom interest is payable on any such interest payment dates; (vi) the right, if any, to extend the interest payment periods and the duration of such extension; (vii) the period or periods within which, the price or prices at which and the terms and conditions upon which such Junior Subordinated Debentures may be redeemed, in whole or in part, at the option of PacifiCorp; (viii) the obligation, if any, of PacifiCorp to redeem or purchase such Junior Subordinated Debentures pursuant to any sinking fund or analogous provisions or at the option of the holder thereof and the period or periods, the price or prices at which, and the terms and conditions upon which, such Junior Subordinated Debentures shall be redeemed or purchased, in whole or part, pursuant to such obligation; (ix) the form of such Junior Subordinated Debentures; (x) if other than denominations of $25 or any integral multiple thereof, the denominations in which such Junior Subordinated Debentures shall be issuable; (xi) any and all other terms with respect to such series; and (xii) whether such Junior Subordinated Debentures are issuable as a global security, and in such case, the identity of the depository. (Section 2.01.) The Indenture does not contain any provisions that afford holders of Junior Subordinated Debentures protection in the event of a highly leveraged transaction involving PacifiCorp. SUBORDINATION The Indenture provides that the Junior Subordinated Debentures are subordinate and junior in right of payment to all Senior Indebtedness (as defined below) of PacifiCorp as provided in the Indenture. No payment of principal of (including redemption and sinking fund payments), or premium, if any, or interest on, the Junior Subordinated Debentures may be made if any Senior Indebtedness is not paid when due, any applicable grace period with respect to such default has ended and such default has not been cured or waived, or if the maturity of any Senior Indebtedness has been accelerated because of a default. Upon any distribution of assets of PacifiCorp to creditors upon any dissolution, winding-up, liquidation or reorganization, whether voluntary or involuntary or in bankruptcy, insolvency, receivership or other proceedings, all principal of and premium, if any, and interest due or to become 5 due on, all Senior Indebtedness must be paid in full before the holders of the Junior Subordinated Debentures are entitled to receive or retain any payment. The rights of the holders of the Junior Subordinated Debentures will be subrogated to the rights of the holders of Senior Indebtedness to receive payments or distributions applicable to Senior Indebtedness until all amounts owing on the Junior Subordinated Debentures are paid in full. (Sections 14.01 to 14.03.) The term "Senior Indebtedness" shall mean the principal of and premium, if any, interest on and any other payment due pursuant to any of the following, whether outstanding at the date of execution of the Indenture or thereafter incurred, created or assumed: (a) all indebtedness of PacifiCorp evidenced by notes, debentures, bonds or other securities sold by PacifiCorp for money; (b) all indebtedness of others of the kinds described in the preceding clause (a) assumed by or guaranteed in any manner by PacifiCorp or in effect guaranteed by PacifiCorp; and (c) all renewals, extensions or refundings of indebtedness of the kinds described in any of the preceding clauses (a) and (b); unless, in the case of any particular indebtedness, renewal, extension or refunding, the instrument creating or evidencing the same or the assumption or guarantee of the same expressly provides that such indebtedness, renewal, extension or refunding is not superior in right of payment to or is pari passu with the Junior Subordinated Debentures. Such Senior Indebtedness shall continue to be Senior Indebtedness and entitled to the benefits of the subordination provisions irrespective of any amendment, modification or waiver of any term of such Senior Indebtedness. (Section 1.01.) The Indenture does not limit the aggregate amount of Senior Indebtedness which may be issued. As of June 30, 1994, Senior Indebtedness of PacifiCorp aggregated approximately $3.7 billion. As the Junior Subordinated Debentures will be issued by PacifiCorp, the Junior Subordinated Debentures effectively will be subordinate to all obligations of PacifiCorp's subsidiaries, and the rights of PacifiCorp's creditors, including holders of the Junior Subordinated Debentures, to participate in the assets of such subsidiaries upon liquidation or reorganization will be junior to the rights of the holders of all preferred stock, indebtedness and other liabilities of such subsidiaries, which may include trade payables, obligations to banks under credit facilities, guarantees, pledges, support arrangements, bonds, capital leases, notes and other obligations. With respect to Pacific Telecom, the rights of PacifiCorp's creditors, including holders of the Junior Subordinated Debentures, will also be limited to PacifiCorp's 87% ownership interest in Pacific Telecom. CERTAIN COVENANTS OF PACIFICORP PacifiCorp will covenant that it will not declare or pay any dividend on, or redeem, purchase, acquire or make a distribution or liquidation payment with respect to, any of its capital stock, if at such time (i) there shall have occurred any event that would constitute an Event of Default under the Indenture or (ii) PacifiCorp shall have given notice of its selection of an extended interest payment period as provided in the Indenture and such period, or any extension thereof, shall be continuing. (Section 4.06.) With respect to any issuance of Junior Subordinated Debentures to PacifiCorp Delaware in connection with the issuance of Preferred Securities, PacifiCorp will also covenant (i) not to declare or pay any dividend on or redeem, purchase, acquire or make a distribution or liquidation payment with respect to any of its capital stock, if at such time PacifiCorp shall be in default with respect to its payment of any obligations under the Guarantee, (ii) to remain the sole general partner of PacifiCorp Delaware and maintain 100% ownership of the general partner interests thereof; provided that any permitted successor of PacifiCorp under the Indenture may succeed to PacifiCorp's duties as General Partner, (iii) to contribute capital to the extent required to maintain its capital at an amount equal to at least 3% of the total capital contributions to PacifiCorp Delaware, (iv) not to voluntarily dissolve, wind-up or terminate PacifiCorp Delaware, except in connection with the distribution of Junior Subordinated Debentures to the holders of Preferred Securities in liquidation of PacifiCorp Delaware and in connection with certain 6 mergers, consolidations or amalgamations permitted by the Limited Partnership Agreement, (v) to timely perform all of its duties as the general partner in PacifiCorp Delaware (including the duty to pay dividends on the Preferred Securities) and (vi) to use its reasonable efforts to cause PacifiCorp Delaware to remain a limited partnership and otherwise continue to be treated as a partnership for United States federal income tax purposes. FORM, EXCHANGE, REGISTRATION AND TRANSFER Junior Subordinated Debentures of each series will be issued in registered form and in either certificated form or will be represented by one or more global securities. If not represented by one or more global securities, Junior Subordinated Debentures may be presented for registration of transfer (with the form of transfer endorsed thereon duly executed) or exchange, at the office of the Debenture Registrar or at the office of any transfer agent designated by PacifiCorp for such purpose with respect to any series of Junior Subordinated Debentures and referred to in an applicable Prospectus Supplement, without service charge and upon payment of any taxes and other governmental charges as described in the Indenture. Such transfer or exchange will be effected upon the Debenture Registrar or such transfer agent, as the case may be, being satisfied with the documents of title and identity of the person making the request. PacifiCorp has appointed the Trustee as Debenture Registrar with respect to the Junior Subordinated Debentures. (Section 2.05.) If a Prospectus Supplement refers to any transfer agent (in addition to the Debenture Registrar) initially designated by PacifiCorp with respect to any series of Junior Subordinated Debentures, PacifiCorp may at any time rescind the designation of any such transfer agent or approve a change in the location through which any such transfer agent acts, except that PacifiCorp will be required to maintain a transfer agent in each Place of Payment for such series. (Section 4.02.) PacifiCorp may at any time designate additional transfer agents with respect to any series of Junior Subordinated Debentures. In the event of any redemption in part, PacifiCorp shall not be required to (i) issue, register the transfer of or exchange any Junior Subordinated Debenture during a period beginning at the opening of business 15 days before any selection for redemption of Junior Subordinated Debentures of like tenor and of the series of which such Junior Subordinated Debenture is a part, and ending at the close of business on the earliest date in which the relevant notice of redemption is deemed to have been given to all holders of Junior Subordinated Debentures of like tenor and of such series to be redeemed and (ii) register the transfer of or exchange any Junior Subordinated Debentures so selected for redemption, in whole or in part, except the unredeemed portion of any Junior Subordinated Debenture being redeemed in part. (Section 2.05.) PAYMENT AND PAYING AGENTS Unless otherwise indicated in an applicable Prospectus Supplement, payment of principal of and premium (if any) on any Junior Subordinated Debenture will be made only against surrender to the Paying Agent of such Junior Subordinated Debenture. Unless otherwise indicated in an applicable Prospectus Supplement, principal of and any premium and interest, if any, on Junior Subordinated Debentures will be payable, subject to any applicable laws and regulations, at the office of such Paying Agent or Paying Agents as PacifiCorp may designate from time to time, except that at the option of PacifiCorp payment of any interest may be made by check mailed to the address of the person entitled thereto as such address shall appear in the Debenture Register with respect to such Junior Subordinated Debentures. (Section 4.03.) Unless otherwise indicated in an applicable Prospectus Supplement, payment of interest on a Junior Subordinated Debenture on any Interest Payment Date will be made to the person in whose name such Junior Subordinated Debenture (or Predecessor Security) is registered at the close of business on the Regular Record Date for such interest payment. (Section 2.03.) PacifiCorp will act as Paying Agent with respect to the Junior Subordinated Debentures. PacifiCorp may at any time designate additional Paying Agents or rescind the designation of any Paying Agents or approve a change in the office through which any Paying Agent acts, except that PacifiCorp will be required to maintain a Paying Agent in each Place of Payment for each series of the respective Junior Subordinated Debentures. (Sections 4.02 and 4.03.) 7 All moneys paid by PacifiCorp to a Paying Agent for the payment of the principal of or premium, if any, or interest on any Junior Subordinated Debenture of any series which remain unclaimed at the end of two years after such principal, premium, if any, or interest shall have become due and payable will be repaid to PacifiCorp and the holder of such Junior Subordinated Debenture will thereafter look only to PacifiCorp for payment thereof. (Section 11.05.) GLOBAL DEBENTURES If any Junior Subordinated Debentures of a series are represented by one or more global securities, the applicable Prospectus Supplement will describe the circumstances, if any, under which beneficial owners of interests in any such Global Debenture may exchange such interests for Junior Subordinated Debentures of such series and of like tenor and principal amount in any authorized form and denomination. Principal of and any premium and interest on a Global Debenture will be payable in the manner described in the applicable Prospectus Supplement. (Section 2.11.) The specific terms of the depository arrangement with respect to any portion of a series of Junior Subordinated Debentures to be represented by a Global Debenture will be described in the applicable Prospectus Supplement. MODIFICATION OF THE INDENTURE The Indenture contains provisions permitting PacifiCorp and the Trustee, with the consent of the holders of not less than a majority in principal amount of the Junior Subordinated Debentures of each series which are affected by the modification, to modify the Indenture or any supplemental indenture affecting that series or the rights of the holders of that series of Junior Subordinated Debentures; provided, that no such modification may, without the consent of the holder of each outstanding Junior Subordinated Debenture affected thereby, (i) extend the fixed maturity of any Junior Subordinated Debentures of any series, or reduce the principal amount thereof, or reduce the rate or extend the time of payment of interest thereon, or reduce any premium payable upon the redemption thereof, without the consent of the holder of each Junior Subordinated Debenture so affected or (ii) reduce the percentage of Junior Subordinated Debentures, the holders of which are required to consent to any such supplemental indenture, without the consent of the holders of each Junior Subordinated Debenture then outstanding and affected thereby. (Section 9.02.) In addition, PacifiCorp and the Trustee may execute, without the consent of any holder of Junior Subordinated Debentures, any supplemental indenture for certain other usual purposes including the creation of any new series of Junior Subordinated Debentures. (Sections 2.01, 9.01 and 10.01.) EVENTS OF DEFAULT The Indenture provides that any one or more of the following described events, which has occurred and is continuing, constitutes an "Event of Default" with respect to each series of Junior Subordinated Debentures: (a) failure for 10 days to pay interest on the Junior Subordinated Debentures of that series, including any Additional Interest in respect thereof, when due; or (b) failure to pay principal or premium, if any, on the Junior Subordinated Debentures of that series when due whether at maturity, upon redemption by declaration or otherwise, or to make any sinking fund payment with respect to that series; or (c) failure to observe or perform any other covenant (other than those specifically relating to one or more other series) contained in the Indenture for 90 days after notice; or (d) certain events of bankruptcy, insolvency or reorganization of PacifiCorp. (Section 6.01.) 8 With respect to any issuance of Junior Subordinated Debentures to PacifiCorp Delaware in connection with the issuance of Preferred Securities, the Indenture will also provide that the dissolution, winding-up or termination of PacifiCorp Delaware, except in connection with the distribution of Junior Subordinated Debentures to the holders of Preferred Securities in liquidation of PacifiCorp Delaware and in connection with certain mergers, consolidations or amalgamations permitted by the Limited Partnership Agreement, shall constitute an "Event of Default" with respect to each series of Junior Subordinated Debentures. The holders of a majority in aggregate outstanding principal amount of any series of the Junior Subordinated Debentures have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee for that series. (Section 6.06.) The Trustee or the holders of not less than 25% in aggregate outstanding principal amount of any particular series of the Junior Subordinated Debentures may declare the principal due and payable immediately on default with respect to such series, but the holders of a majority in aggregate outstanding principal amount of such series may annul such declaration and waive the default if the default has been cured and a sum sufficient to pay all matured installments of interest and principal and any premium has been deposited with the Trustee. (Sections 6.01 and 6.06.) The holders of a majority in aggregate outstanding principal amount of all series of the Junior Subordinated Debentures affected thereby may, on behalf of the holders of all the Junior Subordinated Debentures of such series, waive any past default, except a default in the payment of principal, premium, if any, or interest. (Section 6.06.) PacifiCorp is required to file annually with the Trustee a certificate as to whether or not PacifiCorp is in compliance with all the conditions and covenants under the Indenture. (Section 5.03(d).) CONSOLIDATION, MERGER AND SALE The Indenture does not contain any covenant which restricts PacifiCorp's ability to merge or consolidate with or into any other corporation, sell or convey all or substantially all of its assets to any person, firm or corporation or otherwise engage in restructuring transactions. (Section 10.01.) DEFEASANCE AND DISCHARGE Under the terms of the Indenture, PacifiCorp will be discharged from any and all obligations in respect of the Junior Subordinated Debentures of any series (except in each case for certain obligations to register the transfer or exchange of Junior Subordinated Debentures, replace stolen, lost or mutilated Junior Subordinated Debentures, maintain paying agencies and hold moneys for payment in trust) if PacifiCorp deposits with the Trustee, in trust, moneys or Government Obligations, in an amount sufficient to pay all the principal of, and interest on, the Junior Subordinated Debentures of such series on the dates such payments are due in accordance with the terms of such Junior Subordinated Debentures and, in certain circumstances, delivers to the Trustee an Opinion of Counsel to the effect that the holders of Junior Subordinated Debentures of such series will not recognize income, gain or loss for federal income tax purposes as a result of such deposit and discharge and will 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 such deposit and discharge had not occurred. In addition to discharging certain obligations under the Indenture as stated above, if the Company delivers to the Trustee an Opinion of Counsel (in lieu of the Opinion of Counsel referred to above) to the effect that (a) the Company has received from, or there has been published by the Internal Revenue Service a ruling or (b) since the date of the Indenture there has been a change in applicable federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, the holders of Junior Subordinated Debentures of such series will not recognize income, gain or loss for federal income tax purposes as a result of such deposit, defeasance and discharge and will 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 such deposit, defeasance and discharge had not occurred, and (c) the trust resulting from the defeasance is a valid trust and will not constitute a regulated investment company under the Investment Company Act of 1940, as amended, then, in such event, the Company will be deemed to have paid and discharged the entire indebtedness on the Junior Subordinated Debentures. In the event of any such defeasance and discharge of Junior Subordinated Debentures of such series, holders of Junior Subordinated Debentures of such series would 9 be able to look only to such trust fund for payment of principal (and premium, if any) and interest, if any, on their Junior Subordinated Debentures of such series. (Sections 11.01, 11.02 and 11.03.) GOVERNING LAW The Indenture and the Junior Subordinated Debentures will be governed by, and construed in accordance with, the laws of the State of New York. (Section 13.04.) INFORMATION CONCERNING THE TRUSTEE The Trustee, prior to default, undertakes to perform only such duties as are specifically set forth in the Indenture and, after default, shall exercise the same degree of care as a prudent individual would exercise in the conduct of his or her own affairs. (Section 7.01.) Subject to such provision, the Trustee is under no obligation to exercise any of the powers vested in it by the Indenture at the request of any holder of Junior Subordinated Debentures, unless offered reasonable indemnity by such holder against the costs, expenses and liabilities which might be incurred thereby. (Section 7.02.) The Trustee is not required to expend or risk its own funds or otherwise incur personal financial liability in the performance of its duties if the Trustee reasonably believes that repayment or adequate indemnity is not reasonably assured to it. (Section 7.01.) PacifiCorp maintains a banking relationship with the Trustee. The Trustee serves as trustee under other indentures pursuant to which unsecured debt securities issued on behalf of PacifiCorp are outstanding. MISCELLANEOUS PacifiCorp will have the right at all times to assign any of its rights or obligations under the Indenture to a direct or indirect wholly-owned subsidiary of PacifiCorp; provided, that, in the event of any such assignment, PacifiCorp will remain liable for all such obligations. PacifiCorp Delaware may not assign any of its rights under the Indenture without the prior written consent of PacifiCorp. Subject to the foregoing, the Indenture will be binding upon and inure to the benefit of the parties thereto and their respective successors and assigns. The Indenture provides that it may not otherwise be assigned by the parties thereto. (Section 13.11.) DESCRIPTION OF THE PREFERRED SECURITIES PacifiCorp Delaware may issue, from time to time, Preferred Securities, in one or more series, having terms described in the Prospectus Supplement relating thereto. The limited partnership agreement of PacifiCorp Delaware will be amended and restated (as so amended and restated, the "Limited Partnership Agreement") to authorize the establishment of one or more series of Preferred Securities, having such terms, including dividends, redemption, voting, liquidation rights and such other preferred or other special rights or such restrictions as shall be set forth therein or otherwise established by the General Partner pursuant thereto. Reference is made to the Prospectus Supplement relating to the Preferred Securities of a particular series for specific terms, including (i) the distinctive designation of such series which shall distinguish it from other series; (ii) the number of Preferred Securities included in such series, which number may be increased or decreased from time to time unless otherwise provided by the General Partner in creating the series; (iii) the annual dividend rate or rates (or method of determining such rate or rates) for Preferred Securities of such series and the date or dates upon which such dividends shall be payable; provided, however, dividends on any series of Preferred Securities shall be payable on a monthly basis to holders of such series of Preferred Securities as of a record date in each month during which such series of Preferred Securities are outstanding; (iv) the right, if any, to extend the dividend payment periods and the duration of any such extension; (v) whether dividends on Preferred Securities of such series shall be cumulative, and, in the case of Preferred Securities of any series having cumulative dividend rights, the date or dates or method of determining the date or dates from which dividends on Preferred Securities of such series shall be cumulative; (vi) the amount or amounts which shall be paid out of the assets of PacifiCorp Delaware to the holders of Preferred Securities of such series upon voluntary or involuntary dissolution, winding-up or termination of PacifiCorp Delaware; (vii) the price or prices at which, the period or periods within which and the terms 10 and conditions upon which Preferred Securities of such series may be redeemed or purchased, in whole or in part, at the option of PacifiCorp Delaware or the General Partner; (viii) the obligation, if any, of PacifiCorp Delaware to purchase or redeem Preferred Securities of such series and the price or prices at which, the period or periods within which and the terms and conditions upon which Preferred Securities of such series shall be purchased or redeemed, in whole or in part, pursuant to such obligation; (ix) the voting rights, if any, of Preferred Securities of such series in addition to those required by law, including the number of votes per Preferred Security and any requirement for the approval by the holders of Preferred Securities, or of Preferred Securities of one of more series, or of both, as a condition to specified action or amendments to the Limited Partnership Agreement; and (x) any other relative rights, preferences, privileges, limitations or restrictions of Preferred Securities of the series not inconsistent with the Limited Partnership Agreement or with applicable law. All Preferred Securities offered hereby will be guaranteed by PacifiCorp to the extent set forth below under "Description of the Guarantee." Any applicable federal income tax considerations applicable to any offering of Preferred Securities will be described in the Prospectus Supplement relating thereto. DESCRIPTION OF THE GUARANTEE Set forth below is a summary of information concerning the Guarantee which will be executed and delivered by PacifiCorp for the benefit of the holders from time to time of Preferred Securities. The summary does not purport to be complete and is subject in all respects to the provisions of, and is qualified in its entirety by reference to, the Guarantee, which is filed as an exhibit to the Registration Statement of which this Prospectus forms a part. GENERAL PacifiCorp will irrevocably and unconditionally agree, to the extent set forth in the Guarantee, to pay in full, to the holders of the Preferred Securities of each series, the Guarantee Payments (as defined below) (except to the extent paid by PacifiCorp Delaware), as and when due, regardless of any defense, right of set-off or counterclaim which PacifiCorp Delaware may have or assert. The following payments with respect to any series of Preferred Securities to the extent not paid by PacifiCorp Delaware (the "Guarantee Payments") will be subject to the Guarantee (without duplication): (i) any accrued and unpaid dividends which are required to be paid on the Preferred Securities of such series, to the extent PacifiCorp Delaware shall have funds legally available therefor, (ii) the redemption price, including all accrued and unpaid dividends (the "Redemption Price"), payable out of funds legally available therefor with respect to any Preferred Securities called for redemption by PacifiCorp Delaware and (iii) upon a liquidation of PacifiCorp Delaware, the lesser of (a) the aggregate of the liquidation preference and all accrued and unpaid dividends on the Preferred Securities of such series to the date of payment and (b) the amount of assets of PacifiCorp Delaware remaining available for distribution to holders of Preferred Securities of such series in liquidation of PacifiCorp Delaware. PacifiCorp's obligation to make a Guarantee Payment may be satisfied by direct payment of the required amounts by PacifiCorp to the holders of Preferred Securities or by causing PacifiCorp Delaware to pay such amounts to such holders. CERTAIN COVENANTS OF PACIFICORP In the Guarantee, PacifiCorp will covenant that, so long as any Preferred Securities remain outstanding, PacifiCorp will not declare or pay any dividend on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of its capital stock or make any guarantee payment with respect to the foregoing if at such time PacifiCorp shall be in default with respect to its payment or other obligations under the Guarantee or there shall have occurred any event that would constitute an Event of Default under the Indenture described above. See "Description of the Junior Subordinated Debentures." AMENDMENTS AND ASSIGNMENT Except with respect to any changes which do not adversely affect the rights of holders of Preferred Securities (in which case no vote will be required), the Guarantee may be changed only with the prior approval of the holders of not less than 66-2/3% in liquidation preference of the outstanding 11 Preferred Securities. The manner of obtaining any such approval of holders of the Preferred Securities of each series will be as set forth in an accompanying Prospectus Supplement. All guarantees and agreements contained in the Guarantee shall bind the successors, assigns, receivers, trustees and representatives of PacifiCorp and shall inure to the benefit of the holders of the Preferred Securities then outstanding. TERMINATION OF THE GUARANTEE The Guarantee will terminate and be of no further force and effect as to the Preferred Securities of any series upon full payment of the Redemption Price of all Preferred Securities of such series, and will terminate completely upon full payment of the amounts payable upon liquidation of PacifiCorp Delaware. The Guarantee will continue to be effective or will be reinstated, as the case may be, if at any time any holder of Preferred Securities of any series must restore payment of any sums paid under such series of Preferred Securities or the Guarantee. STATUS OF THE GUARANTEE The Guarantee will constitute an unsecured obligation of PacifiCorp and will rank (i) subordinate and junior in right of payment to all liabilities of PacifiCorp, (ii) pari passu with the most senior preferred or preference stock now or hereafter issued by PacifiCorp and with any guarantee now or hereafter entered into by PacifiCorp in respect of any preferred or preference stock of any affiliate of PacifiCorp and (iii) senior to PacifiCorp's common stock. The Limited Partnership Agreement provides that each holder of Preferred Securities by acceptance thereof agrees to the subordination provisions and other terms of the Guarantee. The Guarantee will constitute a guarantee of payment and not of collection. The Guarantee will be deposited with the General Partner to be held for the benefit of the holders of each series of the Preferred Securities. In the event of the appointment of a special representative of PacifiCorp Delaware and the limited partners (a "Special Representative") to, among other things, enforce the Guarantee, the Special Representative may take possession of the Guarantee for such purpose. If no Special Representative has been appointed to enforce the Guarantee, the General Partner has the right to enforce the Guarantee on behalf of the holders of each series of the Preferred Securities. The holders of not less than 10% in aggregate liquidation preference of the Preferred Securities have the right to direct the time, method and place of conducting any proceeding for any remedy available in respect of the Guarantee, including the giving of directions to the General Partner or the Special Representative, as the case may be. If the General Partner or the Special Representative fails to enforce the Guarantee as above provided, any holder of Preferred Securities may institute a legal proceeding directly against the Guarantor to enforce its rights under the Guarantee, without first instituting a legal proceeding against PacifiCorp Delaware or any other person or entity. The Guarantee will not be discharged except by payment of the Guarantee Payments in full to the extent not paid by PacifiCorp Delaware and by complete performance of all obligations under the Guarantee. EFFECT OF OBLIGATIONS UNDER THE JUNIOR SUBORDINATED DEBENTURES AND THE GUARANTEE As set forth in the Limited Partnership Agreement, the sole purpose of PacifiCorp Delaware is to issue limited partnership interests in PacifiCorp Delaware and to invest the proceeds thereof in Junior Subordinated Debentures of PacifiCorp. As long as payments of interest and other payments are made when due on the Junior Subordinated Debentures issued in connection with Preferred Securities, such payments will be sufficient to cover dividends and payments due on the Preferred Securities primarily because (i) the aggregate principal amount of such Junior Subordinated Debentures will be equal to the sum of the aggregate stated liquidation preference of the Preferred Securities and the General Partner's capital contribution with respect to the Preferred Securities; (ii) the interest rate and interest and other payment dates on such Junior Subordinated Debentures of each series will match the dividend rate and dividend and other payment dates for the Preferred Securities of such series; (iii) the Limited Partnership Agreement provides that PacifiCorp, as General Partner, shall pay for all, and PacifiCorp Delaware shall not be 12 obligated to pay, directly or indirectly, for any, costs and expenses of PacifiCorp Delaware; and (iv) the Limited Partnership Agreement further provides that the General Partner shall not cause or permit PacifiCorp Delaware to, among other things, engage in any activity that is not consistent with the purposes of PacifiCorp Delaware. If PacifiCorp fails to make interest or other payments on the Junior Subordinated Debentures issued in connection with Preferred Securities when due, the Limited Partnership Agreement provides a mechanism whereby the holders of the Preferred Securities may appoint a Special Representative to enforce the rights of PacifiCorp Delaware under such Junior Subordinated Debentures. Payments of dividends and other payments due on the Preferred Securities out of moneys held by PacifiCorp Delaware are guaranteed by PacifiCorp to the extent set forth under "--General" above. The Limited Partnership Agreement also provides, and PacifiCorp, under the Guarantee, acknowledges, that a Special Representative may be appointed to enforce the Guarantee if PacifiCorp is in default on any of its payment obligations under the Guarantee. In addition, if the General Partner or the Special Representative fails to enforce the Guarantee, a holder of a Preferred Security may institute a legal proceeding directly against PacifiCorp to enforce its rights under the Gurantee without first instituting a legal proceeding against PacifiCorp Delaware or any other person or entity. PacifiCorp and PacifiCorp Delaware believe that the above mechanisms and obligations, taken together, are substantially equivalent to a full and unconditional guarantee by PacifiCorp of payments due on the Preferred Securities. GOVERNING LAW The Guarantee will be governed by and construed in accordance with the laws of the State of New York. PLAN OF DISTRIBUTION PacifiCorp may sell any series of Junior Subordinated Debentures, and PacifiCorp Delaware may sell any series of Preferred Securities, in one or more of the following ways at any time or from time to time: (i) to underwriters for resale to the public or to institutional investors; (ii) directly to institutional investors; or (iii) through agents to the public or to institutional investors. The Prospectus Supplement with respect to each series of Offered Securities will set forth the terms of the offering of such Offered Securities, including the name or names of any underwriters or agents, the purchase price of such Offered Securities and the proceeds to PacifiCorp or PacifiCorp Delaware, as the case may be, from such sale, any underwriting discounts or agency fees and other items constituting underwriters' or agents compensation, any initial public offering price, any discounts or concessions allowed or reallowed or paid to dealers and any securities exchanges on which such Offered Securities may be listed. If underwriters are used in the sale, such Offered Securities will be acquired by the underwriters for their own account and may be resold from time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale. Unless otherwise set forth in the Prospectus Supplement, the obligations of the underwriters to purchase any series of Offered Securities will be subject to certain conditions precedent and the underwriters will be obligated to purchase all of such series of Offered Securities, if any are purchased. Underwriters and agents may be entitled under agreements entered into with PacifiCorp and/or PacifiCorp Delaware to indemnification by PacifiCorp and/or PacifiCorp Delaware against certain civil liabilities, including liabilities under the Securities Act, or to contribution with respect to payments which the underwriters or agents may be required to make in respect thereof. Underwriters and agents may be customers of, engage in transactions with, or perform services for PacifiCorp and its subsidiaries in the ordinary course of business. Each series of Offered Securities will be a new issue of securities and will have no established trading market. Any underwriters to whom Offered Securities are sold by PacifiCorp or PacifiCorp 13 Delaware for public offering and sale may make a market in such Offered Securities, but such underwriters will not be obligated to do so and may discontinue any market making at any time without notice. The Offered Securities may or may not be listed on a national securities exchange. EXPERTS The audited consolidated financial statements of PacifiCorp and subsidiaries and supplemental schedules incorporated by reference in this Prospectus have been audited by Deloitte & Touche LLP, independent auditors, as stated in their reports included in or incorporated by reference in PacifiCorp's Annual Report on Form 10-K incorporated by reference herein, and have been so incorporated herein in reliance upon such reports given upon the authority of that firm as experts in accounting and auditing. With respect to any unaudited interim financial information that is incorporated herein by reference, Deloitte & Touche LLP have applied limited procedures in accordance with professional standards for a review of such information. However, as stated in their reports included in any Quarterly Reports on Form 10-Q 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 the review procedures applied. Deloitte & Touche LLP are not subject to the liability provisions of Section 11 of the United States Securities Act of 1933 for their reports on the unaudited interim financial information because those reports are not "reports" or a "part" of the Registration Statement to which this Prospectus is a part prepared or certified by an accountant within the meaning of Sections 7 and 11 of said Securities Act. LEGAL OPINIONS Certain legal matters in connection with the Offered Securities, including the validity of the Indenture, the Guarantee and the Junior Subordinated Debentures will be passed upon for PacifiCorp and PacifiCorp Delaware by Stoel Rives Boley Jones & Grey, Portland, Oregon, and for the underwriters by Winthrop, Stimson, Putnam & Roberts, New York, New York. Certain matters of Delaware law relating to the validity of the Preferred Securities, the validity of the Limited Partnership Agreement and the formation of PacifiCorp Delaware will be passed upon by Richards, Layton & Finger, P.A., as special Delaware counsel to PacifiCorp and PacifiCorp Delaware. Certain tax matters in connection with the Preferred Securities will be passed upon for PacifiCorp and PacifiCorp Delaware by Stoel Rives Boley Jones & Grey. John M. Schweitzer and John Detjens III, who are assistant secretaries of PacifiCorp, are partners in the firm of Stoel Rives Boley Jones & Grey. 14 PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION Filing fee-Securities and Exchange Commission . . . . . . . . $51,723 *Fees of state regulatory authorities . . . . . . . . . . . . 1,000 *Counsel fees . . . . . . . . . . . . . . . . . . . . . . . . 170,000 *Accountants' fees . . . . . . . . . . . . . . . . . . . . . . 20,000 *Stock Exchange Listing Fees . . . . . . . . . . . . . . . . . 85,000 *Rating agency fees . . . . . . . . . . . . . . . . . . . . . 50,000 *Trustee Fees . . . . . . . . . . . . . . . . . . . . . . . . 25,000 *Printing of registration statement, prospectus, certificates, etc . . . . . . . . . . . . . . . . . . . . . 150,000 *Miscellaneous expenses . . . . . . . . . . . . . . . . . . . 21,000 _______ Total . . . . . . . . . . . . . . . . . . . . . . . . . .$573,723 _______ _______ _______________ * Estimated ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS PacifiCorp's Second Restated Articles of Incorporation, as amended ("Restated Articles"), and Bylaws, as amended ("Bylaws"), require PacifiCorp to indemnify directors and officers to the fullest extent not prohibited by law. The right to and amount of indemnification will be ultimately subject to determination by a court that indemnification in the circumstances presented is consistent with public policy considerations and other provisions of law. It is likely, however, that the Restated Articles would require indemnification at least to the extent that indemnification is authorized by the Oregon Business Corporation Act ("OBCA"). The effect of the OBCA is summarized as follows: (a) The OBCA permits PacifiCorp to grant a right of indemnification in respect of any pending, threatened or completed action, suit or proceeding, other than an action by or in the right of PacifiCorp, against expenses (including attorneys' fees), judgments, penalties, fines and amounts paid in settlement actually and reasonably incurred, provided the person concerned acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of PacifiCorp, and, with respect to any criminal action or proceeding, had no reasonable cause to believe the conduct was unlawful. Indemnification is not permitted in connection with a proceeding in which a person is adjudged liable on the basis that personal benefit was improperly received unless indemnification is permitted by a court upon a finding that the person is fairly and reasonably entitled to indemnification in view of all of the relevant circumstances. The termination of a proceeding by judgment, order, settlement, conviction or plea of nolo contendere or its equivalent is not, of itself, determinative that the person did not meet the prescribed standard of conduct. (b) The OBCA permits PacifiCorp to grant a right of indemnification in respect of any proceeding by or in the right of PacifiCorp against the reasonable expenses (including attorneys' fees) incurred, if the person concerned acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of PacifiCorp, except that no indemnification may be granted if such person is adjudged to be liable to PacifiCorp unless permitted by a court. (c) Under the OBCA, PacifiCorp may not indemnify a person in respect of a proceeding described in (a) or (b) above unless it is determined that indemnification is permissible because the person has met the prescribed standard of conduct by any one of the following: (i) the Board of Directors, by a majority vote of a quorum consisting of directors not at the time parties to the proceeding, (ii) if a quorum of directors not parties to the proceeding cannot be obtained, by a majority vote of a committee of two or more directors not at the time parties to the proceeding, (iii) by special legal counsel selected by the Board of Directors or the committee thereof, as described in (i) and (ii) above, or (iv) by the shareholders. Authorization of the indemnification and evaluation as to the II-1 reasonableness of expenses are to be determined as specified in any one of (i) through (iv) above, except that if the determination of such indemnification's permissibility is made by special counsel then the determination of the reasonableness of such expenses is to be made by those entitled to select special counsel. Indemnification can also be ordered by a court if the court determines that indemnification is fair in view of all of the relevant circumstances. Notwithstanding the foregoing, every person who has been wholly successful, on the merits or otherwise, in defense of a proceeding described in (a) or (b) above is entitled to be indemnified as a matter of right against reasonable expenses incurred in connection with the proceeding. (d) Under the OBCA, PacifiCorp may pay for or reimburse the reasonable expenses incurred in defending a proceeding in advance of the final disposition thereof if the director or officer receiving the advance furnishes (i) a written affirmation of the director's or officer's good faith belief that he or she has met the prescribed standard of conduct, and (ii) a written undertaking to repay the advance if it is ultimately determined that such person did not meet the standard of conduct. The rights of indemnification described above are not exclusive of any other rights of indemnification to which officers or directors may be entitled under any statute, agreement, vote of shareholders, action of directors, or otherwise. Indemnity agreements entered into by PacifiCorp require PacifiCorp to indemnify the directors that are parties thereto to the fullest extent permitted by law and are intended to create an obligation to indemnify to the fullest extent a court may find to be consistent with public policy considerations. Resolutions adopted by PacifiCorp's board of directors are intended to have a similar result with respect to officers of PacifiCorp. PacifiCorp has directors' and officers' liability insurance coverage which insures officers and directors of PacifiCorp against certain liabilities. Pursuant to the Limited Partnership Agreement, to the fullest extent permitted by applicable law, PacifiCorp Delaware shall indemnify and hold harmless the General Partner or any Special Representative, any affiliate of the General Partner or any Special Representative or any officers, directors, shareholders, partners, employees, representatives or agents of the General Partner or any Special Representative, or any employee or agent of PacifiCorp Delaware or its affiliates (each, an "Indemnified Person") from and against any loss, damage or claim incurred by such Indemnified Person by reason of any act or omission performed or omitted by such Indemnified Person in good faith on behalf of PacifiCorp Delaware and in a manner reasonably believed to be within the scope of authority conferred on such Indemnified Person by the Limited Partnership Agreement, except that no Indemnified Person shall be entitled to be indemnified in respect of any loss, damage or claim incurred by such Indemnified Person by reason of gross negligence or willful misconduct with respect to such acts or omissions; provided, however, that any such indemnity shall be provided out of and to the extent of PacifiCorp Delaware's assets only, and no General Partner or limited partner (collectively, "Partners"), any affiliate of a Partner or any officers, directors, shareholders, partners, employees, representatives or agents of a Partner or its respective affiliates, or any employee or agent of PacifiCorp Delaware or its affiliates or any Special Representative shall have any personal liability on account thereof. To the fullest extent permitted by applicable law, expenses (including legal fees) incurred by an Indemnified Person in defending any claim, demand, action, suit or proceeding shall, from time to time, be advanced by PacifiCorp Delaware prior to the final disposition of such claim, demand, action, suit or proceeding upon receipt by PacifiCorp Delaware of an undertaking by or on behalf of the Indemnified Person to repay such amount if it shall be determined that the Indemnified Person is not entitled to be indemnified. ITEM 16. EXHIBITS Exhibit No. Description of Exhibits ___________ _______________________ (1)(a) Form of Underwriting Agreement to be used in connection with the issuance of Preferred Securities. (1)(b) Form of Underwriting Agreement to be used in connection with the issuance of Junior Subordinated Debentures only. II-2 (4)(a) Form of Indenture between PacifiCorp and The Bank of New York as Trustee. *(4)(b) Form of Supplemental Indenture to Indenture to be used in connection with the issuance of Junior Subordinated Debentures and fixed rate Preferred Securities. *(4)(c) Form of Supplemental Indenture to Indenture to be used in connection with the issuance of Junior Subordinated Debentures and adjustable rate Preferred Securities. *(4)(d) Form of Supplemental Indenture to Indenture to be used in connection with Junior Subordinated Debentures only. *(4)(e) Certificate of Limited Partnership of PacifiCorp Delaware. *(4)(f) Limited Partnership Agreement of PacifiCorp Delaware. (4)(g) Form of Amended and Restated Agreement of Limited Partnership of PacifiCorp Delaware. (4)(h) Form of Action creating fixed rate Series A Preferred Securities. (4)(i) Form of Action creating adjustable rate Series A Preferred Securities. *(4)(j) Form of Preferred Security (included in Exhibit (4)(g) above). *(4)(k) Form of Junior Subordinated Debenture (included in Exhibits (4)(b), (c) and (d) above). *(4)(l) Form of Guarantee Agreement with respect to Preferred Securities. *(5)(a) Opinion of Stoel Rives Boley Jones & Grey with respect to Preferred Securities, Guarantee and Junior Subordinated Debentures. *(5)(b) Opinion of Richards, Layton & Finger with respect to Preferred Securities. *(8) Opinion of Stoel Rives Boley Jones & Grey with respect to tax matters. **(12)(a) Statement re Computation of Consolidated Ratios of Earnings to Fixed Charges. (Exhibit 12, Form 10-Q for the quarter ended June 30, 1994, File No. 1-5152). *(12)(b) Statement re Computation of Consolidated Ratios of Earnings to Combined Fixed Charges and Preferred Stock Dividends. (15) Letter re Unaudited Interim Financial Information. (Exhibit 15, Form 10-Q for the quarter ended June 30, 1994, File No. 1-5152). *(23)(a) Consent of Deloitte & Touche LLP. *(23)(b) Consent of Stoel Rives Boley Jones & Grey (included in (5)(a) and (8) above). *(23)(c) Consent of Richards, Layton & Finger (included in (5)(b) above). *(24) Powers of Attorney. *(25)(a) Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Bank of New York, as Trustee under the Indenture. ________________ *Previously filed. **Incorporated by reference. II-3 ITEM 17. UNDERTAKINGS (a) The undersigned Registrants hereby undertake: (1) To file, during any period in which offers or sales are being made, a post effective amendment to this Registration Statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the Registration Statement; and (iii) To include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement; provided, however, that the undertakings set forth in paragraph (a)(1)(i) and (a)(1)(ii) above do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed by PacifiCorp pursuant to Section 13 or 15(d) of the Securities Act of 1934 that are incorporated by reference in the Registration Statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (b) For purposes of determining any liability under the Securities Act of 1933, each filing of PacifiCorp's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in the Registration Statement shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons controlling the Registrants pursuant to the provision described under Item 15 above, or otherwise, the Registrants have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrants of expenses incurred or paid by a director, officer or controlling person of the Registrants in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrants will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. (d) For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this Registration Statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) under the Securities Act shall be deemed to be part of this Registration Statement as of the time it was declared effective. (e) For purposes of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. II-4 SIGNATURES PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, PACIFICORP CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED THEREUNTO DULY AUTHORIZED, IN THE CITY OF PORTLAND, STATE OF OREGON ON THE 13TH DAY OF OCTOBER 1994. PACIFICORP By: RICHARD T. O'BRIEN ___________________________ Richard T. O'Brien (Vice President) PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS ON OCTOBER 13, 1994 IN THE CAPACITIES INDICATED. Signature Title _________ _____ *FREDERICK W. BUCKMAN President, Chief Executive Officer ___________________________ and Director Frederick W. Buckman *WILLIAM J. GLASGOW Senior Vice President and ___________________________ Chief Financial Officer William J. Glasgow *DANIEL L. SPALDING Senior Vice President ___________________________ (Chief Accounting Officer) Daniel L. Spalding *C.M. BISHOP, JR. Director ___________________________ C.M. Bishop, Jr. *C. TODD CONOVER Director ___________________________ C. Todd Conover *RICHARD C. EDGLEY Director ___________________________ Richard C. Edgley *A.M. GLEASON Director ___________________________ A.M. Gleason (Vice Chairman) *JOHN C. HAMPTON Director ___________________________ John C. Hampton *NOLAN E. KARRAS Director ___________________________ Nolan E. Karras II-5 *KEITH R. MCKENNON Director ___________________________ Keith R. McKennon (Chairman) *ROBERT G. MILLER Director ___________________________ Robert G. Miller *VERL R. TOPHAM Director ___________________________ Verl R. Topham *DON M. WHEELER Director ___________________________ Don M. Wheeler *NANCY WILGENBUSCH Director ___________________________ Nancy Wilgenbusch *By RICHARD T. O'BRIEN _______________________ Richard T. O'Brien (Attorney-in-Fact) II-6 SIGNATURES PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, PACIFICORP DELAWARE, L.P. CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED THEREUNTO DULY AUTHORIZED, IN THE CITY OF PORTLAND, STATE OF OREGON ON THE 13TH DAY OF OCTOBER 1994. PACIFICORP DELAWARE, L.P. By: PacifiCorp, General Partner By: RICHARD T. O'BRIEN __________________________________ Richard T. O'Brien, Vice President II-7 EXHIBIT INDEX Exhibit No. Document Page No. ___________ ________ ________ (1)(a) Form of Underwriting Agreement to be used in connection with the issuance of Preferred Securities. (1)(b) Form of Underwriting Agreement to be used in connection with the issuance of Junior Subordinated Debentures only. (4)(a) Form of Indenture between PacifiCorp and The Bank of New York as Trustee. *(4)(b) Form of Supplemental Indenture to Indenture to be used in connection with the issuance of Junior Subordinated Debentures and fixed rate Preferred Securities. *(4)(c) Form of Supplemental Indenture to Indenture to be used in connection with the issuance of Junior Subordinated Debentures and adjustable rate Preferred Securities. *(4)(d) Form of Supplemental Indenture to Indenture to be used in connection with Junior Subordinated Debentures only. *(4)(e) Certificate of Limited Partnership of PacifiCorp Delaware. *(4)(f) Limited Partnership Agreement of PacifiCorp Delaware. (4)(g) Form of Amended and Restated Agreement of Limited Partnership of PacifiCorp Delaware. (4)(h) Form of Action creating fixed rate Series A Preferred Securities. (4)(i) Form of Action creating adjustable rate Series A Preferred Securities. *(4)(j) Form of Preferred Security (included in Exhibit (4)(g) above). *(4)(k) Form of Junior Subordinated Debenture (included in Exhibits (4)(b), (c) and (d) above). *(4)(l) Form of Guarantee Agreement with respect to Preferred Securities. *(5)(a) Opinion of Stoel Rives Boley Jones & Grey with respect to Preferred Securities, Guarantee and Junior Subordinated Debentures. *(5)(b) Opinion of Richards, Layton & Finger with respect to Preferred Securities. *(8) Opinion of Stoel Rives Boley Jones & Grey with respect to tax matters. **(12)(a) Statement re Computation of Consolidated Ratios of Earnings to Fixed Charges. (Exhibit 12, Form 10-Q for the quarter ended June 30, 1994, File No. 1-5152). *(12)(b) Statement re Computation of Consolidated Ratios of Earnings to Combined Fixed Charges and Preferred Stock Dividends. (15) Letter re Unaudited Interim Financial Information. (Exhibit 15, Form 10-Q for the quarter ended June 30, 1994, File No. 1-5152). *(23)(a) Consent of Deloitte & Touche LLP. *(23)(b) Consent of Stoel Rives Boley Jones & Grey (included in (5)(a) and (8) above). *(23)(c) Consent of Richards, Layton & Finger (included in (5)(b) above). II-8 Exhibit No. Document Page No. ___________ ________ ________ *(24) Powers of Attorney. *(25)(a) Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Bank of New York, as Trustee under the Indenture. ________________ *Previously filed. **Incorporated by reference. II-9 EX-1 2 Exhibit 1(a) Form of Underwriting Agreement relating to Preferred Securities PacifiCorp PacifiCorp Delaware, L.P. Series [__] Preferred Securities UNDERWRITING AGREEMENT [______] Goldman, Sachs & Co. Smith Barney Inc. [insert names of other Representatives] As representatives of the several Underwriters named in Schedule I hereto c/o Goldman, Sachs & Co. 85 Broad Street New York, New York 10004 Ladies and Gentlemen: The undersigned, PacifiCorp Delaware, L.P., a Delaware limited partnership (the "Partnership"), and PacifiCorp, an Oregon corporation (the "Company" and, together with the Partnership, the "Obligors"), hereby confirm their agreement with the several Underwriters (as defined in Section 1 hereof), for whom you are acting as representatives (in such capacity, you shall hereinafter be referred to as the "Representatives"), as follows: 1. Definitions of Certain Terms. Except as may otherwise be defined herein, capitalized terms used herein shall have the following meanings: 2 (a) "Act" shall mean the Securities Act of 1933, as amended. (b) "Articles" shall mean the Second Restated Articles of Incorporation of the Company, as amended. (c) "Business Day" shall mean any day on which the NYSE and banks in the City of New York are open. (d) "Commission" shall mean the Securities and Exchange Commission. (e) "Company Securities" shall mean the Series [__] Debentures and the Guarantee. (f) "Counsel for the Obligors" shall mean Stoel Rives Boley Jones & Grey. (g) "Counsel for the Underwriters" shall mean Winthrop, Stimson, Putnam & Roberts. (h) "Debentures" shall mean junior subordinated debentures of the Company issued under the Indenture having an aggregate initial offering price of up to $150,000,000. (i) "Effective Date" shall mean, at any time, the later of (i) the date that the Registration Statement or any post-effective amendment thereto was or is declared effective by the Commission under the Act and (ii) the date that the Company's Annual Report on Form 10-K for its most recently completed fiscal year is filed with the Commission under the Exchange Act, in each case at such time. (j) "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended. (k) "General Partner" shall mean the Company in its capacity as the general partner of the Partnership. (l) "Guarantee" shall mean the Company's guarantee of the payment of dividends on, and amounts due upon the redemption of or upon the Partnership's liquidation with respect to, the Preferred Securities pursuant to the Guaranty Agreement dated as of [_____] entered into by the Company. (m) "Incorporated Documents" shall mean the documents filed by the Company with the Commission under the Exchange Act that are, or are deemed to be, incorporated by reference in the Prospectus pursuant to Item 12 of Form S-3 under the Act. (n) "Indenture" shall mean the Indenture dated as of [_____] between the Company and The Bank of New York, as trustee (the "Trustee"), as [heretofore] supplemented and amended[, including] by the [_____] Supplemental Indenture dated as of [_____]. 3 (o) "Preferred Securities" shall mean up to 6,000,000 Monthly Income Preferred Securities representing limited partner interests in the Partnership and otherwise having the terms set forth in the Prospectus. (p) "NYSE" shall mean the New York Stock Exchange. (q) "Partnership Agreement" shall mean the Limited Partnership Agreement of the Partnership between the Company, as the General Partner, and the initial limited partner thereof named therein, as amended and restated on or prior to the Closing Date (as defined in Section 4(a) hereof) by the Amended and Restated Agreement of Limited Partnership of the Partnership among the Company, as the General Partner, and the limited partners thereof parties thereto, including the action thereunder of the General Partner creating the Series [__] Preferred Securities (the "Action"). (r) "Partnership Certificate" shall mean the Certificate of Limited Partnership of the Partnership. (s) "Prospectus" shall mean the prospectus relating to the Debentures, the Preferred Securities and the Guarantee included in the Registration Statement, as supplemented by a prospectus supplement specifying the terms of the Securities and the plan of distribution thereof (the "Prospectus Supplement"), as first filed pursuant to Rule 424(b) of the Regulations under the Act, including the Incorporated Documents. (t) "Registration Statement" shall mean the registration statement on Form S-3 (No. 33-55309) filed with the Commission for the registration under the Act of the Debentures, the Preferred Securities and the Guarantee, as amended and supplemented to the date of this Agreement, and shall be deemed to include the Incorporated Documents. (u) "Regulations" shall mean the applicable published rules and regulations of the Commission under the Act, the Exchange Act or the Trust Indenture Act, as the case may be. (v) "Securities" shall mean the Series [__] Preferred Securities and the Company Securities. (w) "Series [__] Debentures" shall mean $[_____] aggregate principal amount of Debentures designated [__]% Deferrable Interest Junior Subordinated Debentures, Series [__], Due [____] having the terms set forth in the Prospectus that may be delivered to holders of Series [__] Preferred Securities upon the occurrence of a Tax Event in accordance with the Partnership Agreement. (x) "Series [__] Preferred Securities" shall mean [_____] Preferred Securities designated [__]% Cumulative Monthly Income Preferred Securities, Series [__] having the terms set forth in the Prospectus. 4 (y) "Tax Event" shall have the meaning ascribed to such term in the Partnership Agreement, except that for purposes of Section 9(e) hereof the specified date referred to therein shall be the date of this Agreement. (z) "Trust Indenture Act" shall mean the Trust Indenture Act of 1939, as amended. (aa) "Underwriters" shall mean the several firms or corporations named in Schedule I hereto and any underwriter substituted as provided in Section 4(c) hereof and "Underwriter" shall mean one of the Underwriters. (ab) "amend," "amendment," "amended," "supplement" or "supplemented" with respect to the Registration Statement or the Prospectus shall mean amendments or supplements to the Registration Statement or the Prospectus, as the case may be, and Incorporated Documents filed after the date of this Agreement and prior to the completion of the distribution of the Securities. 2. Purchase and Sale. Upon the basis of the representations and warranties herein contained, and subject to the terms and conditions set forth in this Agreement, the Partnership agrees to sell to each Underwriter named in Schedule I hereto, severally and not jointly, and such Underwriter agrees, severally and not jointly, to purchase from the Partnership, the number of Series [__] Preferred Securities set forth opposite such Underwriter's name in Schedule I hereto at a purchase price of $25 per Series [__] Preferred Security. As compensation to the Underwriters for their commitments hereunder, and because the proceeds of the sale of the Series [__] Preferred Securities will be loaned by the Partnership to the Company, the Company hereby agrees to pay on the Closing Date to Goldman, Sachs & Co., for the accounts of the several Underwriters, an amount equal to (i) in the case of such number of Series [__] Preferred Securities as are reserved by the Underwriters for sale to institutional investors, $[__] per Series [__] Preferred Security and (ii) in the case of such number of Preferred Securities as are not so reserved, $[__] per Series [__] Preferred Security. For purposes of this Section 2, the number of Series [__] Preferred Securities reserved for sale to institutional investors that the Partnership agrees to sell to the respective Underwriters, severally and not jointly, and that the respective Underwriters agree, severally and not jointly, to purchase from the Partnership at the purchase price set forth in clause (i) above shall be provided to the Partnership by the Representatives at the Closing Date. The Representatives represent that they have been authorized by each Underwriter to enter into this Agreement on behalf of such Underwriter, to confirm the statements described in Section 8(e) hereof and to act for it in the manner herein provided. All obligations of the Underwriters hereunder are several and not joint. The Partnership has been advised by the Representatives that the Underwriters propose to (i) make a public offering of the Series [__] Preferred Securities as soon as the Underwriters deem advisable after this Agreement has been executed and delivered and (ii) initially offer the Series [__] Preferred Securities to the public at the public offering price set forth in the Prospectus. 5 3. Representations and Warranties of Obligors. The Obligors jointly and severally represent and warrant to, and agree with, the several Underwriters as follows: (a) Filing of Registration Statement and any Preliminary Prospectus with Commission. The Obligors meet the requirements for use of Form S-3 under the Act and the Obligors have filed with the Commission the Registration Statement and each preliminary prospectus relating to the Securities required to be filed pursuant to Rule 424 of the Regulations under the Act; and the Registration Statement has been declared effective by the Commission under the Act and meets the requirements set forth in paragraph (a)(1)(ix) or (a)(1)(x) of Rule 415 of the Regulations under the Act and complies in all other material respects with such Rule 415. (b) Registration Statement; Prospectus; Incorporated Documents. (i) The Registration Statement, at the Effective Date, and each preliminary prospectus relating to the Securities, if any, at the time it was filed with the Commission, complied and the Prospectus, at the time it is filed with the Commission, will comply, except in each case for Incorporated Documents, in all material respects with the applicable requirements of the Act and the Trust Indenture Act and the respective Regulations thereunder; (ii) the Registration Statement, at the Effective Date, did not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading; (iii) the Prospectus, at the time it is filed with the Commission, will not and each preliminary prospectus relating to the Securities, if any, at the time it was filed with the Commission, did not include an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; and (iv) each Incorporated Document, at the time originally filed with the Commission pursuant to the Exchange Act, complied and will comply, as the case may be, in all material respects with the applicable requirements of the Exchange Act and the Regulations thereunder; provided, however, that the Obligors make no representation or warranty as to (A) such part of the Registration Statement that constitutes the Statement of Eligibility on Form T-1 under the Trust Indenture Act of the Trustee or (B) the information contained in or omitted from the Registration Statement or the Prospectus in reliance upon and in conformity with information furnished in writing to the Obligors by the Representatives specifically for use in connection with the preparation of the Registration Statement or the Prospectus. (c) Financial Statements. The consolidated financial statements included or incorporated by reference in the Registration Statement and the Prospectus present fairly the financial 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 involved except as otherwise indicated in the Registration Statement and the Prospectus; and Deloitte & Touche LLP, who examined the audited financial statements, are independent public accountants as required by the Act and the Regulations thereunder. 6 (d) Material Changes or Transactions. Except as reflected in, or contemplated by, the Registration Statement and the Prospectus, since the respective most recent dates as of which information is given in the Registration Statement and the Prospectus, there has not been any material adverse change in the business, affairs, business prospects, property or financial condition of either Obligor, whether or not arising in the ordinary course of business, and since such dates there has not been any material transaction entered into by either Obligor other than transactions contemplated by the Registration Statement and the Prospectus, and transactions in the ordinary course of business; and neither Obligor has any material contingent obligation that is not disclosed in the Registration Statement and the Prospectus. (e) No Defaults. The Company is not in violation of the Articles or its Bylaws, as amended, or in default in the performance or observance of any material obligation, agreement, covenant or condition contained in any contract, agreement or other instrument to which it is a party or by which it may be bound, the effect of which is material to the Company and its subsidiaries taken as a whole, and neither the execution or delivery of this Agreement, the consummation of the transactions herein contemplated, the fulfillment of the terms hereof nor compliance with the terms and provisions hereof will conflict with, or result in a breach of, or constitute a default under, (i) the Articles or the Company's Bylaws, as amended, or any material contract, agreement or other instrument that the Company has assumed or to which it is now a party or by which it may be bound or (ii) any order, rule or regulation applicable to the Company of any court or any federal or state regulatory body or administrative agency or other governmental body having jurisdiction over the Company or its properties; and the Partnership is not in violation of the Partnership Certificate or the Partnership Agreement or in default in the performance or observance of any obligation, agreement, covenant or condition contained therein, and neither the execution or delivery of this Agreement, the consummation of the transactions herein contemplated, the fulfillment of the terms hereof nor compliance with the terms and provisions hereof will conflict with, or result in a breach of, or constitute a default under, (A) the Partnership Certificate or the Partnership Agreement or (B) any order, rule or regulation applicable to the Partnership of any court or any federal or state regulatory body or administrative agency or other governmental body having jurisdiction over the Partnership or its properties. (f) Due Incorporation and Qualification of Company. The Company has been duly incorporated and is validly existing as a corporation under the laws of the State of Oregon with corporate power and corporate authority (i) to own its properties and conduct its business as described in the Prospectus, (ii) to execute and deliver, and perform its obligations under, this Agreement, the Indenture, the Partnership Agreement and the Company Securities, (iii) to execute and deliver, as the General Partner on behalf of the Partnership, this Agreement and the certificates for the Series [__] Preferred Securities and (iv) to perform, as the General Partner on behalf of the Partnership, the Partnership's obligations under this Agreement and the Series [__] Preferred Securities; and the Company is duly qualified as a foreign corporation to transact business and is in good standing in each jurisdiction in which it owns or leases substantial properties or in which the conduct of its business requires such qualification, except where the failure to 7 so qualify would not have a material adverse effect on the financial condition of the Partnership or of the Company and its subsidiaries taken as a whole. (g) Due Formation and Registration of Partnership. The Partnership has been duly formed and is validly existing as a limited partnership under the laws of the State of Delaware with partnership power and partnership authority (i) to own its properties and conduct its business as described in the Prospectus, (ii) to execute and deliver this Agreement and the certificates for the Series [__] Preferred Securities and (iii) to perform its obligations under this Agreement and the Series [__] Preferred Securities; the Partnership is a special purpose limited partnership as described in the Prospectus and has conducted and will conduct no business other than the transactions contemplated by this Agreement and described in the Prospectus; and the Partnership is not a party to or otherwise bound by any contract, agreement or other instrument other than this Agreement, the Partnership Agreement and the Partnership Certificate, as described in the Prospectus, and is not a party to any action, suit or proceeding of any nature. (h) Agreement. This Agreement has been duly authorized, executed and delivered by the Obligors and is a valid and legally binding agreement of each of the Obligors enforceable in accordance with its terms, except as limited by bankruptcy, insolvency, fraudulent conveyance, reorganization and other similar laws relating to or affecting creditors' rights generally and general equitable principles (whether considered in a proceeding in equity or at law) and subject to any principles of public policy limiting the right to enforce the indemnification and contribution provisions contained herein. (i) Indenture. The Indenture has been duly authorized, executed and delivered by the Company, has been duly qualified under the Trust Indenture Act and is a valid and legally binding agreement of the Company enforceable in accordance with its terms, except as limited by bankruptcy, 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). (j) Guarantee. The Guarantee has been duly authorized, executed and delivered by the Company and is a valid and legally binding obligation of the Company enforceable in accordance with its terms, except as limited by bankruptcy, 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). (k) Series [__] Debentures. The Series [__] Debentures have been duly authorized and, when authenticated and delivered in accordance with the Indenture and paid for by the purchasers thereof, will constitute valid and legally binding obligations of the Company enforceable in accordance with their respective terms, except as limited by bankruptcy, insolvency, fraudulent conveyance, reorganization and other similar laws relating to or affecting creditors' rights generally and general equitable principles (whether considered in a proceeding in equity or at law); and the Series [__] Debentures conform to all statements relating thereto contained in the Registration Statement and the Prospectus. 8 (l) Series [__] Preferred Securities. The Series [__] Preferred Securities have been duly authorized for issuance and will, upon issuance and delivery thereof against payment therefor in accordance with this Agreement, be validly issued, fully paid and non-assessable limited partner interests and entitled to the rights set forth in the Partnership Agreement. (m) Capital Stock. The authorized, issued and outstanding capital stock of the Company is as set forth in the Registration Statement and the Prospectus (except for changes referred to therein or contemplated thereby and additional shares offered under the Company's Dividend Reinvestment and Stock Purchase Plan, K Plus Employee Savings and Stock Ownership Plan or Utah Power & Light Company Employee Savings and Stock Purchase Plan). (n) Control of Partnership. On the date hereof the Company is, and on the Closing Date the Company will be, the sole general partner of the Partnership. (o) Investment Company Act. Neither Obligor is an "investment company" or an entity "controlled" by an "investment company," as such terms are defined in the Investment Company Act of 1940, as amended. Any certificate signed by any officer of the Company, on behalf of itself or as the General Partner on behalf of the Partnership, and delivered to the Representatives or to Counsel for the Underwriters shall be deemed a representation and warranty by the Company or the Partnership, respectively, to each Underwriter as to the statements made therein. 4. Closing; Delivery of Series [__] Preferred Securities; Defaulting Underwriters. (a) Closing. Delivery of the Series [__] Preferred Securities to the Underwriters, against payment of the purchase price therefor in next day funds by certified or bank check or checks payable to the order of the Partnership and drawn on a bank which is a member of the New York Clearing House Association, shall be made prior to 1:00 P.M., New York City time, on [_____] through the facilities of The Depository Trust Company ("DTC"), or at such other time, date and location as may be agreed upon in writing by the Obligors and the Representatives. Delivery of the documents required by Section 6 hereof shall be made at such time and date at the offices of [_____], or at such other location as may be agreed upon in writing by the Obligors and the Representatives. The hour and date of such delivery and payment are herein called the "Closing Date." (b) Delivery of Series [__] Preferred Securities. The certificates for the Series [__] Preferred Securities shall be registered in the name of "Cede & Co.," as nominee of DTC, and delivered to DTC in such denominations as the Representatives may reasonably request in writing not later than 12:30 P.M., New York City time, on the third Business Day prior to the Closing Date or, to the extent not so requested, in such authorized denominations as the Partnership shall determine. For the purpose of expediting the checking of the certificates for the Series [__] Preferred Securities by the Representatives on behalf of the Underwriters, the Partnership agrees to make such certificates available to the Representatives for such purpose 9 at the offices of DTC in New York, New York, not later than 2:00 P.M., New York City time, on the Business Day preceding the Closing Date or at such other time and place as may be agreed upon by the Partnership and the Representatives. (c) Defaulting Underwriters. If on the Closing Date any Underwriter shall fail to purchase and pay for the Series [__] Preferred Securities that such Underwriter has agreed to purchase and pay for hereunder on such date (otherwise than by reason of any failure on the part of either Obligor to comply with any of the provisions contained herein), the non-defaulting Underwriters shall be obligated, severally and not jointly, to take up and pay for (in addition to the respective number of Series [__] Preferred Securities set forth opposite their respective names in Schedule I hereto) the number of Series [__] Preferred Securities that such defaulting Underwriter or Underwriters failed to take up and pay for, up to a number of Series [__] Preferred Securities equal to, in the case of each such non-defaulting Underwriter, ten percent (10%) of the number of Series [__] Preferred Securities set forth opposite the name of such non-defaulting Underwriter in Schedule I hereto and such non-defaulting Underwriters shall have the right, within 24 hours of such default, either to take up and pay for (in such proportion as may be agreed upon among them), or to substitute another Underwriter or Underwriters, satisfactory to the Obligors, to take up and pay for, the remaining number of Series [__] Preferred Securities that the defaulting Underwriter or Underwriters agreed but failed to purchase. If any unpurchased Series [__] Preferred Securities still remain, then the Obligors shall be entitled to a further period of 24 hours within which to procure another party or other parties, members of the National Association of Securities Dealers, Inc. (or, if not members of such Association, who are not eligible for membership in such Association and who agree (i) to make no sales within the United States, its territories or its possessions or to persons who are citizens thereof or residents therein and (ii) in making sales to comply with such Association's Rules of Fair Practice) and satisfactory to the Representatives, to purchase such Series [__] Preferred Securities on the terms herein set forth. In the event that, within the respective prescribed periods, the non- defaulting Underwriters notify the Obligors that they have arranged for the purchase of such Series [__] Preferred Securities, or the Obligors notify the non-defaulting Underwriters that they have arranged for the purchase of such Series [__] Preferred Securities, then the non-defaulting Underwriters or the Obligors shall have the right to postpone the Closing Date for a period of not more than three full Business Days beyond the expiration of the respective prescribed periods in order to effect whatever changes may thus be made necessary in the Registration Statements or the Prospectus or in any other documents or arrangements. In the event that none of the non- defaulting Underwriters or the Obligors has arranged for the purchase of such Series [__] Preferred Securities by another party or parties as above provided, then this Agreement shall terminate without any liability on the part of the Obligors or any Underwriter (other than an Underwriter which shall have failed or refused, otherwise than for some reason sufficient to justify, in accordance with the terms hereof, the cancellation or termination of its obligations hereunder, to purchase and pay for the Series [__] Preferred Securities that such Underwriter has agreed to purchase as provided in Section 2 hereof), except as otherwise provided in Section 5(j) hereof. 5. Covenants of Obligors. Each of the Obligors jointly and severally covenants and agrees with the Underwriters that: 10 (a) Filing of Prospectus. The Obligors will promptly transmit copies of the Prospectus, and any amendments or supplements thereto, to the Commission for filing pursuant to Rule 424(b) of the Regulations under the Act. (b) Copies of Registration Statement and Prospectus; Stop Orders. The Obligors will deliver to each of the Representatives and Counsel for the Underwriters (i) one signed copy of the Registration Statement as originally filed, including copies of exhibits thereto (other than any exhibits incorporated by reference therein), (ii) signed copies of any amendments and supplements to the Registration Statement, including copies of the Incorporated Documents (other than exhibits thereto), and (iii) a signed copy of each consent and certificate included or incorporated by reference in, or filed as an exhibit to, the Registration Statement as so amended or supplemented; the Obligors will deliver to the Underwriters through the Representatives as soon as practicable after the date of this Agreement as many copies of the Prospectus as the Representatives may reasonably request for the purposes contemplated by the Act; the Obligors will promptly advise the Representatives of the issuance of any stop order under the Act with respect to the Registration Statement (as it may be amended or supplemented) or the institution of any proceedings therefor, or the suspension of the qualification of the Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose, of which either Obligor shall have received notice prior to the completion of the distribution of the Securities; and the Obligors will use their best efforts to prevent the issuance of any such stop order and to secure the prompt removal thereof, if issued. (c) Filing of Amendments and Supplements. During the period when a prospectus relating to any of the Securities is required to be delivered under the Act by any Underwriter or dealer, neither Obligor will file any amendment or supplement to the Registration Statement, the Prospectus (including a prospectus relating to the Series [__] Preferred Securities filed pursuant to Rule 424(b) of the Regulations under the Act that differs from the Prospectus as first filed pursuant to such Rule 424(b)) or any Incorporated Document to which Goldman, Sachs & Co. shall reasonably object as to substance or Counsel for the Underwriters shall reasonably object as to form. (d) Compliance with Act. During the period when a prospectus relating to any of the Securities is required to be delivered under the Act by any Underwriter or dealer, the Obligors will comply so far as they are able, and at their own expense, with all requirements imposed upon them by the Act, as now and hereafter amended, and by the Regulations thereunder, as from time to time in force, so far as necessary to permit the continuance of sales of or dealing in the Securities during such period in accordance with the provisions hereof and the Prospectus. (e) Certain Events and Amendments or Supplements. If, during the period when a prospectus relating to any of the Securities is required to be delivered under the Act by any Underwriter or dealer, (i) any event relating to or affecting either Obligor or of which either Obligor shall be advised in writing by the Representatives shall occur as a result of which, in the opinion of either Obligor, the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances 11 under which they were made, not misleading or (ii) it shall be necessary to amend or supplement the Registration Statement or the Prospectus to comply with the Act, the Exchange Act or the Trust Indenture Act or the respective Regulations thereunder, the Obligors will forthwith at their expense prepare and furnish to the Representatives a reasonable number of copies of such amendment or supplement that will correct such statement or omission or effect such compliance; provided, however, that should such event relate solely to activities of any of the Underwriters, then the Underwriters will assume the expense of preparing and furnishing copies of any such amendment or supplement. Notwithstanding the foregoing, in case any Underwriter is required to deliver a prospectus relating to any of the Securities after the expiration of nine months after the date of this Agreement, the Obligors upon the request of the Representatives will furnish to the Representatives, at the expense of such Underwriter, a reasonable quantity of a supplemented or amended Prospectus or supplements or amendments to the Prospectus complying with Section 10 of the Act. (f) Blue Sky Qualifications. During the period when a prospectus relating to any of the Securities is required to be delivered under the Act by any Underwriter or dealer, the Obligors will furnish such proper information as may be lawfully required and otherwise cooperate in qualifying the Securities for offer and sale under the blue sky laws of such jurisdictions as the Representatives may reasonably designate and will file and make in each year such statements or reports as are or may be reasonably required by laws of such jurisdictions; provided, however, that the Partnership shall not be required to register as a foreign partnership and the Company shall not be required to qualify as a foreign corporation, and neither Obligor shall be required to qualify as a dealer in securities or to file any consents to service of process, under the laws of any jurisdiction. (g) Earning Statement. In accordance with Rule 158 of the Regulations under the Act, the Company will make generally available to its security holders and to holders of the Securities, as soon as practicable, an earning statement (which need not be audited) in reasonable detail covering the 12 months beginning not later than the first day of the month next succeeding the month in which occurred the effective date (within the meaning of Rule 158 of the Regulations under the Act) of the Registration Statement. (h) Reports. The Company will furnish to the holders of the Securities as soon as practicable after the end of each fiscal year an annual report (including a balance sheet and statements of income, stockholders' equity and cash flow of the Company and its consolidated subsidiaries certified by independent public accountants) and, as soon as practicable after the end of each of the first three quarters of each fiscal year (beginning with the first such fiscal quarter ending after the effective date of the Registration Statement), consolidated summary financial information of the Company and its subsidiaries for such quarter in reasonable detail. (i) Exchange Act Documents; Ratings Notification. The Obligors, during the period when a prospectus relating to any of the Securities is required to be delivered under the Act by any Underwriter or dealer, will file promptly all documents required to be filed with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act; and the Obligors will promptly notify the Representatives of any written 12 notice given to either Obligor by any "nationally recognized statistical rating organization" (as defined for purposes of Rule 15c3-1 under the Exchange Act) of any intended decrease in any rating of any of the Preferred Securities or any preferred stock or first mortgage or first mortgage and collateral trust bonds of the Company or of any intended change in any such rating that does not indicate the direction of the possible change, in each case by any such rating organization. (j) Payment of Expenses. Whether or not the transactions contemplated hereunder are consummated or this Agreement is terminated, the Obligors will pay, except as otherwise expressly provided herein, all expenses incident to the performance of their respective obligations under this Agreement, including (i) the preparation and filing of the Registration Statement and the Prospectus (and any amendments or supplements thereto), any preliminary prospectus relating to any of the Securities and any Incorporated Documents and exhibits thereto, and this Agreement, (ii) the issuance and delivery of the Series [__] Preferred Securities to the Underwriters, (iii) the fees and disbursements of each Obligor's counsel and accountants, (iv) the fees and expenses of the Trustee and its counsel, (v) the fees and expenses in connection with the rating of the Series [__] Preferred Securities by securities rating organizations, (vi) the expenses in connection with the qualification of the Securities under securities laws in accordance with the provisions of Section 5(f) hereof, including filing fees and the reasonable fees and disbursements of Counsel for the Underwriters in connection therewith and in connection with the preparation of any Blue Sky Survey, (vii) the printing and delivery to the Underwriters of copies of the Registration Statement and the Prospectus (and any amendments or supplements thereto) and the Incorporated Documents, (viii) the printing and delivery to the Underwriters of copies of any Blue Sky Survey and (ix) the fees and expenses in connection with the listing of the Series [__] Preferred Securities and the Debentures on the NYSE and the registration thereof under the Exchange Act in accordance with Section 5(l) hereof. If this Agreement is terminated in accordance with the provisions of Section 6, 7 or 9 hereof, or if this Agreement is terminated pursuant to Section 4 hereof and could have been terminated in accordance with the provisions of Section 6, 7 or 9 hereof, the Obligors will reimburse the Representatives for the account of the Underwriters for their reasonable out-of- pocket expenses in an amount not exceeding $15,000 in the aggregate, and reasonable counsel fees and disbursements; provided, however, that if the Representatives terminate this Agreement pursuant to Section 9(d) hereof, neither Obligor shall be obligated to reimburse the Representatives for their out-of-pocket expenses or for their counsel fees and disbursements. Neither Obligor shall be required to pay any amount for any expenses of the Representatives or of any other of the Underwriters except as provided in this Section 5(j). Neither Obligor shall in any event be liable to any of the Underwriters for damages on account of the loss of anticipated profits. (k) No Issuance Period. During the 30 days following the Closing Date, neither Obligor will, without the prior written consent of the Representatives, offer for sale, sell or enter into any agreement to sell, or otherwise dispose of, any Series [__] Preferred Securities, any limited partner interests of the Partnership or any preferred stock or any other securities of either Obligor that are substantially similar to the Series [__] Preferred Securities or any securities convertible into or exchangeable for Series 13 [__] Preferred Securities, limited partner interests, preferred stock or such substantially similar securities of either Obligor. (l) Listing and Registration. The Obligors will take, or cause to be taken, all actions necessary or advisable to effect the listing and admission for trading of the Series [__] Preferred Securities on the NYSE and the registration thereof under the Exchange Act; and the Company will, upon the distribution of Series [__] Debentures to holders of Series [__] Preferred Securities, use its best efforts to effect the listing and admission for trading of the Series [__] Debentures on the NYSE, or such other national securities exchange upon which the Series [__] Preferred Securities are then listed, and the registration thereof under the Exchange Act. (m) Control of Partnership. So long as any Series [__] Preferred Securities are outstanding, the Company will be the sole general partner of the Partnership. (n) Company Securities; Company Guarantee. The Company (i) agrees to issue the Company Securities concurrently with the issue and sale of the Series [__] Preferred Securities as contemplated herein and (ii) guarantees the timely performance by the Partnership of its obligations under Sections 2 and 4 hereof; and the Partnership agrees to purchase the Series [__] Debentures with the proceeds of, and concurrently with, the issue and sale of the Series [__] Preferred Securities. 6. Conditions to Underwriters' Obligations. The several obligations of the Underwriters hereunder to purchase the Series [__] Preferred Securities shall be subject to the continuing accuracy of, and compliance with, the representations and warranties of the Obligors contained herein on the Closing Date (with the same force and effect as though expressly made on and as of the Closing Date, except that references therein to the Registration Statement and the Prospectus shall include any amendments or supplements thereto at the Closing Date), to the performance by each Obligor of its obligations to be performed hereunder on or prior to the Closing Date and to the following further conditions: (a) Filing of Prospectus with Commission; No Stop Order; Regulatory Approvals. The Prospectus, and any amendments or supplements thereto, shall have been filed in the manner and within the time period required by Rule 424(b) of the Regulations under the Act; no stop order suspending the effectiveness of the Registration Statement under the Act shall have been issued and no proceedings for that purpose shall have been instituted or threatened; no order suspending trading or striking or withdrawing the Series [__] Preferred Securities from listing on the NYSE or registration thereof under the Exchange Act shall be in effect, no proceedings for such purpose shall be pending before or threatened by the NYSE and all requests for additional information on the part of the Commission shall have been complied with; the orders of the public utility regulatory authorities in the States of Idaho, Montana, Oregon, Utah, and Wyoming each authorizing the issuance of the Company Securities by the Company and the issuance and sale of the Series [__] Preferred Securities by the Partnership as contemplated by this Agreement, the order dated April 27, 1988 of the California Public Utilities Commission exempting any issuance of securities of the Company from its jurisdiction and the order of the Washington Utilities and Transportation Commission as 14 to the compliance by the Company with the filing requirements of RCW 80.08.040 shall be in full force and effect and shall not then be either contested or the subject of review or appeal, and such orders constitute the only approval, authorization, consent or other order of any governmental body legally required for the authorization of the issuance of the Company Securities by the Company and the issuance and sale of the Series [__] Preferred Securities by the Partnership pursuant to the terms of this Agreement, except such as may be required under the Act or under state or other securities or blue sky laws; and each Obligor shall have delivered to the Representatives a certificate of the Partnership and the Company, as the case may be, signed by the President or any Vice President of the Company, as the General Partner on behalf of the Partnership and on behalf of itself, respectively, dated the Closing Date, to such effect with copies attached thereto of such orders and of evidence of registration of the Partnership to transact business as a foreign limited partnership or qualification of the Company to transact business as a foreign corporation, as the case may be, in each jurisdiction in which it owns or leases substantial properties or in which the conduct of its business requires such registration or qualification, except where the failure to so register or qualify would not have a material adverse effect on the financial condition of the Partnership or of the Company and its subsidiaries taken as a whole. (b) Opinion of Counsel for Partnership. On the Closing Date, the Representatives shall have received an opinion of Richards, Layton & Finger, P.A., special Delaware counsel for the Partnership and the Company, dated as of the Closing Date, in form and substance satisfactory to Counsel for the Underwriters, to the effect that: (i) the Partnership has been duly formed and is validly existing in good standing as a limited partnership under the laws of the State of Delaware; (ii) under the Partnership Agreement and the Delaware Revised Uniform Limited Partnership Act, as amended (the "Delaware Limited Partnership Act"), the Partnership has all necessary partnership authority (A) to own its properties and to carry on the business in which it is engaged, all as described in the Prospectus, (B) to execute and deliver this Agreement and the certificates for the Series [__] Preferred Securities and (C) to perform its obligations under this Agreement and the Series [__] Preferred Securities; and under the Partnership Agreement and the Delaware Limited Partnership Act, such execution, delivery and performance have been duly authorized by all necessary partnership action on the part of the Partnership; (iii) assuming that the Partnership Agreement has been duly authorized, executed and delivered by the partners of the Partnership, the Partnership Agreement is a valid and legally binding agreement of the Company, and is enforceable against the Company, as the General Partner, in accordance with its terms, subject to the effect upon the Partnership Agreement of bankruptcy, insolvency, moratorium, fraudulent conveyance, receivership, liquidation, reorganization and other similar laws relating to or affecting the rights and remedies of creditors generally and by principles of equity, including 15 principles relating to fiduciary duties (regardless of whether considered in a proceeding in equity or at law); (iv) the Series [__] Preferred Securities have been duly and validly authorized and are validly issued and, subject to the qualifications set forth herein, fully paid and nonassessable limited partner interests in the Partnership as to which the holders of the Series [__] Preferred Securities, as limited partners of the Partnership (assuming that such holders, as limited partners of the Partnership, do not participate in the control of the business of the Partnership), will have no liability in excess of their obligations to make payments provided for in the Partnership Agreement and their share of the Partnership's assets and undistributed profits (subject to the obligation of any holder of Series [__] Securities to repay any funds wrongfully distributed to it); (v) there are no provisions of the Partnership Agreement the inclusion of which, subject to the terms and conditions therein, or, assuming that the holders of the Series [__] Preferred Securities, as limited partners of the Partnership, take no action other than actions permitted by the Partnership Agreement, the exercise of which, in accordance with the terms and conditions therein, would cause such holders, as limited partners of the Partnership, to be deemed to be participating in the control of the business of the Partnership; (vi) this Agreement and the certificates for the Series [__] Preferred Securities have been duly authorized, and upon the execution and delivery thereof by the General Partner on behalf of the Partnership will be duly executed and delivered, by the Partnership; (vii) the General Partner is authorized under the Partnership Agreement and the Delaware Limited Partnership to execute and deliver the Action and, on behalf of the Partnership, this Agreement and the certificates for the Series [__] Preferred Securities and to perform, on behalf of the Partnership, this Agreement and the Series [__] Preferred Securities; (viii) no approval, authorization, consent or other order of any Delaware governmental body is legally required solely as a result of the issuance and sale of the Series [__] Preferred Securities by the Partnership pursuant to this Agreement, except as may be required under state or other securities or blue sky laws; (ix) the issuance and sale by the Partnership of the Series [__] Preferred Securities pursuant to, and the execution, delivery and performance by the Partnership of, this Agreement will not violate (A) any Delaware law or (B) the Partnership Certificate or the Partnership Agreement; (x) such counsel has reviewed the statements in the Prospectus under each of the two captions "PacifiCorp Delaware, L.P." and, insofar as such statements contain descriptions of Delaware law, such statements are fairly 16 presented; and under the Partnership Agreement and the Delaware Limited Partnership Act, the form of certificate attached as Annex A to the Partnership Agreement is an appropriate certificate to evidence the Series [__] Preferred Securities; and (xi) assuming that the Partnership (A) is treated as a partnership for federal income tax purposes, (B) derives no income from or connected with sources within the State of Delaware and (C) has no assets, activities (other than the maintenance of a registered office and registered agent in the State of Delaware and the filing of documents with the Delaware Secretary of State) or employees in the State of Delaware, holders of the Series [__] Preferred Securities (other than such holders who reside or are domiciled in the State of Delaware) will have no liability for income taxes imposed by the State of Delaware solely as a result of their participation in the Partnership, and the Partnership will not be liable for any income tax imposed by the State of Delaware. In rendering such opinion, such counsel may rely as to matters of fact, to the extent deemed proper, on certificates of responsible officers of the Company, on its behalf of itself and as the General Partner on behalf of the Partnership, and public officials. References to the Registration Statement and the Prospectus in this Section 6(b) shall include any amendments or supplements thereto at the date such opinion is rendered. (c) Opinion of Counsel for Obligors. On the Closing Date, the Representatives shall have received an opinion of Counsel for the Obligors, dated as of the Closing Date, in form and substance satisfactory to Counsel for the Underwriters, to the effect that: (i) the Company is a duly organized and validly existing corporation under the laws of the State of Oregon; (ii) the Company has due corporate right and corporate authority (A) to own its properties and to carry on the business in which it is engaged as described in the Prospectus, (B) to execute and deliver, and perform its obligations under, this Agreement, the Indenture, the Partnership Agreement and the Company Securities, (C) to execute and deliver, as the General Partner on behalf of the Partnership, this Agreement and the certificates for the Series [__] Preferred Securities and (D) to perform, as the General Partner on behalf of the Partnership, the Partnership's obligations under this Agreement and the Series [__] Preferred Securities; (iii) the terms of the Securities conform as to legal matters to the description thereof and the statements in regard thereto contained in the Registration Statement and the Prospectus; and the specimen of the Series [__] Debentures is in due and proper form; 17 (iv) the Partnership Agreement has been duly authorized, executed and delivered by the Company and is a valid and legally binding agreement of the Company, and is enforceable against the Company, as the General Partner, in accordance with its terms, subject to the effect upon the Partnership Agreement of bankruptcy, insolvency, moratorium, fraudulent conveyance, receivership, liquidation, reorganization and other similar laws relating to or affecting the rights and remedies of creditors generally and by principles of equity, including principles relating to fiduciary duties (whether considered in a proceeding in equity or at law); (v) the Indenture has been duly authorized, executed and delivered by the Company, has been duly qualified under the Trust Indenture Act and is a valid and legally binding agreement of the Company enforceable in accordance with its terms, except as limited by bankruptcy, 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); (vi) the Series [__] Debentures have been duly authorized and executed by the Company and, when authenticated and delivered in accordance with the Indenture and paid for by the purchasers thereof in accordance with the Partnership Agreement, will constitute valid and legally binding agreements of the Company enforceable in accordance with their respective terms, except as limited by bankruptcy, 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); (vii) the Guarantee has been duly authorized, executed and delivered by the Company and is a valid and binding obligation of the Company enforceable in accordance with its terms, except as limited by bankruptcy, 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); (viii) the Series [__] Preferred Securities have been listed (subject to official notice of issuance) on the NYSE; (ix) this Agreement has been duly authorized, executed and delivered by the Company, on its behalf and as the General Partner on behalf of the Partnership; and the Series [__] Preferred Securities have been duly executed and delivered by the Company, as the General Partner on behalf of the Partnership; (x) the Idaho Public Utilities Commission, the Montana Public Service Commission, the Public Utility Commission of Oregon, the Utah Public Service Commission and the Public Service Commission of Wyoming have entered appropriate orders, which to the best knowledge of such counsel remain 18 in full force and effect on the date of such opinion, each authorizing the issuance of the Company Securities by the Company; the Washington Utilities and Transportation Commission has entered an appropriate order, which to the knowledge of such counsel remains in full force and effect on the date of such opinion, as to the compliance by the Company with the filing requirements of RCW 80.08.040; and such orders constitute the only approval, authorization, consent or other order of any governmental body legally required for the authorization of the issuance of the Company Securities by the Company and the issuance and sale of the Series [__] Preferred Securities by the Partnership pursuant to the terms of this Agreement, except such as may be required under the Act or under state or other securities or blue sky laws; (xi) the consummation of the transactions contemplated by this Agreement and the fulfillment of the terms hereof will not conflict with or result in a breach of any of the terms or provisions of, or constitute a default under, the Articles or the Company's Bylaws, as amended, or any indenture, mortgage, deed of trust or other material agreement for money borrowed the terms of which are known to such counsel to which the Company is a party or by which it may be bound; (xii) the Registration Statement, at the Effective Date, and the Prospectus, at the time it was filed pursuant to Rule 424(b) of the Regulations under the Act (except in each case as to financial statements and other financial and statistical data contained therein, upon which such opinion need not pass, and except for Incorporated Documents), complied as to form in all material respects with the requirements of the Act and the Trust Indenture Act and the respective Regulations thereunder; each Incorporated Document as originally filed pursuant to the Exchange Act (except as to financial statements and other financial and statistical data contained therein, upon which such opinion need not pass) complied as to form when so filed in all material respects with the requirements of the Exchange Act and the Regulations thereunder; the Registration Statement has become, and on the Closing Date is, effective under the Act and, to the best of such counsel's knowledge, no proceedings for a stop order with respect thereto are threatened or pending under Section 8 of the Act; and nothing has come to the attention of such counsel that has caused them to believe that the Registration Statement (except as to financial statements and other financial and statistical data contained therein, upon which such opinion need not pass), at the Effective Date, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that the Prospectus (except as to financial statements and other financial and statistical data contained therein, upon which such opinion need not pass), at the time it was filed pursuant to Rule 424(b) of the Regulations under the Act or on the Closing Date, included or includes an untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; 19 (xiii) those portions of the Registration Statement or the Prospectus that are stated therein to have been made on the authority of such counsel have been reviewed by such counsel and, as to matters of law and legal conclusions, are correct; and (xiv) to the best of such counsel's knowledge and information, there are no legal or governmental proceedings pending or threatened against the Partnership or the Company or its other subsidiaries that are required to be disclosed in the Registration Statement and the Prospectus other than those disclosed therein. In rendering such opinion, Counsel for the Obligors may rely (i) as to matters of fact, to the extent deemed proper, on certificates of responsible officers of the Company, on behalf of itself and as the General Partner on behalf of the Partnership, and the Company's subsidiaries and public officials and (ii) upon the opinion of special Delaware counsel for the Partnership rendered pursuant to Section 6(b) as to matters involving the application of laws other than the laws of the State of Oregon. References to the Registration Statement and the Prospectus in this Section 6(c) shall include any amendments or supplements thereto at the date such opinion is rendered. (d) Opinion of Counsel for Underwriters. On the Closing Date, the Representatives shall have received an opinion of Counsel for the Underwriters, dated as of the Closing Date, with respect to the matters set forth in paragraphs (i), (iii), (v), (vi), (vii), (viii), (ix) and (x) and the first, third and fourth clauses of paragraph (xii) of Section 6(c) hereof and other related matters as the Representatives may reasonably require, and the Obligors shall have furnished to Counsel for the Underwriters such documents as they request for the purpose of enabling them to pass upon such matters. In rendering such opinion, Counsel for the Underwriters may rely (i) as to matters of fact, to the extent deemed proper, on certificates of responsible officers of the Company, on behalf of itself and as the General Partner on behalf of the Partnership, and public officials and (ii) upon the opinions of special Delaware counsel for the Partnership and Counsel for the Obligors rendered pursuant to Sections 6(b) and 6(c) hereof, respectively, as to matters involving the application of laws other than the laws of the State of New York. (e) Opinion of Special Tax Counsel. On the Closing Date, the Representatives shall have received an opinion of Stoel Rives Boley Jones & Grey, counsel for the Obligors, dated as of the Closing Date, in form and substance satisfactory to Counsel for the Underwriters confirming their opinion as set forth under "United States Taxation" in the Prospectus Supplement. (f) Letter of Accountants. On the Closing Date, Deloitte & Touche LLP shall have furnished to the Representatives a letter or letters, dated as of the Closing Date, in form and substance satisfactory to the Representatives, confirming that they are independent accountants within the meaning of the Act and the Regulations thereunder with respect to the Company and its subsidiaries and stating in effect that: 20 (i) in their opinion, the consolidated financial statements and schedules included or incorporated by reference in the Registration Statement and the Prospectus and audited by them comply as to form in all material respects with the applicable accounting requirements of the Act and the Regulations thereunder; (ii) on the basis of a reading of the unaudited consolidated financial statements, if any, included or incorporated by reference in the Registration Statement and the Prospectus and the latest available interim unaudited consolidated financial statements of the Company, the performance of the procedures specified by the American Institute of Certified Public Accountants for a review of any such unaudited consolidated financial information as described in Statement on Auditing Standards No. 71, inquiries of officials of the Company responsible for financial and accounting matters and a reading of the minutes of meetings of the shareholders and the Board of Directors of the Company and the Finance and Pricing Committees thereof through a specified date not more than five Business Days prior to the Closing Date, nothing came to their attention that caused them to believe that: (A) any material modification should be made to the unaudited consolidated financial statements, if any, included or incorporated by reference in the Registration Statement and the Prospectus for them to be in conformity with generally accepted accounting principles or any such unaudited consolidated financial statements do not comply as to form in all material respects with the applicable accounting requirements of the Act or the Regulations thereunder; (B) for the twelve months ended as of the date of the latest available financial statements of the Company, there were any decreases in revenues, earnings on common stock or earnings per common share as compared with the comparable period of the preceding year; or (C) at the date of the latest available financial statements of the Company and at a subsequent date not more than five Business Days prior to the Closing Date, there was any change in the capital stock (except for sales under the Company's Dividend Reinvestment and Stock Purchase Plan, K Plus Employee Savings and Stock Ownership Plan or Utah Power & Light Company Employee Savings and Stock Purchase Plan of PacifiCorp) or long-term debt of the Company or any decrease in its net assets as compared with the amounts shown in the most recent consolidated balance sheet included or incorporated by reference in the Registration Statement and the Prospectus, except in all instances for changes or decreases that the Registration Statement or the Prospectus discloses have occurred or may occur, or for changes or decreases that are described in such letter that are reasonably satisfactory to the Representatives; (iii) if unaudited pro forma financial statements are included or incorporated by reference in the Registration Statement and the Prospectus, on the basis of a reading of such financial statements, carrying out certain specified procedures, inquiries of certain officials of the Company and the company acquired or to be acquired who have responsibility for financial and accounting matters and proving the arithmetic accuracy of the application of the pro forma adjustments to the historical amounts in such pro forma financial statements, 21 nothing came to their attention that caused them to believe that such pro forma financial statements do not comply in form in all material respects with the applicable accounting requirements of Rule 11-02 of Regulation S-X or that such pro forma adjustments have not been properly applied to such historical amounts in the compilation of such pro forma financial statements; and (iv) covering such other matters as the Representatives shall reasonably request, including but not limited to the "Management's Discussion and Analysis of Financial Condition and Results of Operations" contained in the financial statements included or incorporated by reference in the Registration Statement and the Prospectus and any other information of an accounting, financial or statistical nature included therein. References to the Registration Statement and the Prospectus in this Section 6(f) shall include any amendments or supplements thereto at the Closing Date. (g) Certificates. On the Closing Date, there shall not have been, since the respective dates as of which information is given in the Registration Statement and the Prospectus, as they may then be amended or supplemented, except as may otherwise be stated therein or contemplated thereby, any material adverse change in the condition of the Partnership or of the Company and its subsidiaries taken as a whole, financial or otherwise, or in the earnings, affairs or business prospects of the Partnership or of the Company and its subsidiaries taken as a whole, whether or not arising in the ordinary course of business, and the Representatives shall have received a certificate of the Partnership signed by the President or any Vice President of the Company, as the General Partner on behalf of the Partnership, and a certificate of the Company signed by the President or any Vice President of the Company, reasonably satisfactory to the Representatives, each dated as of the Closing Date, to the effect that (i) there has been no such material adverse change, (ii) the other representations and warranties on the part of such Obligor contained in this Agreement are true and correct (with the same force and effect as though expressly made on and as of the Closing Date, except that references therein to the Registration Statement and the Prospectus shall include any amendments or supplements thereto at such dates), (iii) such Obligor has complied with all agreements and satisfied all conditions on its part to be performed or satisfied under this Agreement on or prior to the Closing Date and (iv) no stop order suspending the effectiveness of the Registration Statement (as so amended or supplemented) has been issued and no proceedings for the purpose have been initiated or threatened by the Commission. (h) Ratings. Moody's Investors Service, Inc. and Standard & Poor's Ratings Group shall have publicly assigned to the Series [__] Preferred Securities ratings of [__] and [__], respectively, which ratings shall be in full force and effect on the Closing Date. (i) Listing and Registration. On the Closing Date, (i) the NYSE shall have approved the Series [__] Preferred Securities for listing and admission for trading, subject to official notice of issuance, and (ii) the Company's registration statement on Form 8-A relating to the Series [__] Preferred Securities shall have become effective under the Exchange Act. 22 (j) Underwriters' Compensation. On the Closing Date, the Company shall have paid, or cause to have been paid, the compensation payable to the Underwriters under Section 2 in next day funds by certified or bank check or checks payable to the order of Goldman, Sachs & Co. and drawn on a bank which is a member of the New York Clearing House Association. (k) Other Documents. On the Closing Date, Counsel for the Underwriters shall have been furnished with such documents and opinions as they may reasonably require for the purpose of enabling them to pass upon the issuance and sale of the Series [__] Preferred Securities as herein contemplated and related proceedings, or in order to evidence the accuracy or completeness of any of the representations or warranties, or the fulfillment of any of the conditions herein contained, and all proceedings taken by the Obligors in connection with the issuance of the Securities and as herein contemplated shall be satisfactory in form and substance to the Representatives and Counsel for the Underwriters. In case any of the conditions specified above in this Section 6 shall not have been fulfilled, this Agreement may be terminated by the Representatives upon mailing or delivering written notice thereof to the Obligors. Any such termination shall be without liability of either party to the other party except as otherwise provided in Section 5(j) hereof and except for any liability under Section 8 hereof. 7. Conditions to Obligations of Obligors. The obligations of the Obligors hereunder are subject to the conditions set forth in Section 6(a) hereof exclusive of the first and last clauses thereof. In case such conditions shall not have been fulfilled, this Agreement may be terminated by the Obligors by mailing or delivering written notice thereof to the Representatives. Any such termination shall be without liability of either party to the other party except as otherwise provided in Section 5(j) hereof and except for any liability under Section 8 hereof. 8. Indemnification and Contribution. (a) Indemnification by Obligors. The Obligors jointly and severally agree to indemnify and hold harmless each Underwriter and each person, if any, who controls any Underwriter within the meaning of Section 15 of the Act as follows: (i) against any and all loss, liability, claim, damage and expense whatsoever arising out of any untrue statement or alleged untrue statement of a material fact contained in a preliminary prospectus relating to any of the Securities, if any, including all documents then incorporated by reference therein pursuant to Item 12 of Form S-3, in the Incorporated Documents, in the Registration Statement or the Prospectus, or in the Registration Statement or the Prospectus as amended or supplemented (if any amendments or supplements thereto shall have been made), or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading unless such untrue statement or omission or such alleged untrue statement or omission was made in reliance upon and in conformity with written information furnished to the Obligors by any Underwriter, through the 23 Representatives or otherwise, expressly for use in the Registration Statement or the Prospectus (or any amendment or supplement to either thereof) or arising out of, or based upon, statements in or omissions from that part of the Registration Statement that constitutes the Statement of Eligibility on Form T-1 under the Trust Indenture Act of the Trustee; provided, however, any such indemnity for a preliminary prospectus relating to any of the Securities, if any, or the Prospectus shall not inure to the benefit of any Underwriter (or of any person controlling such Underwriter) on account of any losses, claims, damages or liabilities arising from the sale of the Securities to any person if (i) such Underwriter shall have failed to send or give to such person (A) with or prior to the written confirmation of such sale, a copy of the Prospectus or the Prospectus as amended or supplemented, if any amendments or supplements thereto shall have been furnished to the Representatives at or prior to the time of written confirmation of the sale involved, except any Incorporated Documents, or (B) with or prior to the delivery of the Securities to such person, a copy of any amendment or supplement to the Prospectus that shall have been furnished to the Representatives subsequent to such written confirmation and prior to the delivery of such Securities to such person, except any Incorporated Documents, and (ii) such untrue statement or omission or such alleged untrue statement or omission was corrected in the Prospectus or the Prospectus as amended or supplemented at the time of such delivery or confirmation, as the case may be; (ii) against any and all loss, liability, claim, damage and expense whatsoever to the extent of the aggregate amount paid in settlement of any litigation, commenced or threatened or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, if such settlement is effected with the written consent of the Obligors; and (iii) against any and all expense whatsoever reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid under clause (i) or (ii) above. (b) Indemnification of Obligors. Each Underwriter severally agrees to indemnify and hold harmless the Obligors, their directors, each of their officers who signed the Registration Statement, and any amendments or supplements thereto, and each person, if any, who controls either Obligor within the meaning of Section 15 of the Act against any and all loss, liability, claim, damage and expense described in the indemnity contained in Section 8(a) hereof, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration Statement (or any amendment thereto) or a preliminary prospectus relating to any of the Securities, if any, or the Prospectus (or any amendment or supplement thereto) in reliance upon and in conformity with written information furnished to the Obligors by such Underwriter, through the Representatives or otherwise, expressly for use in the Registration Statement (or any amendment or supplement thereto) or any such preliminary prospectus or the Prospectus (or any amendment or supplement thereto). (c) General. Each indemnified party shall give prompt notice to each indemnifying party of any action commenced against it in respect of which indemnity may be 24 sought hereunder, but failure so to notify an indemnifying party shall not relieve it from any liability on account of this indemnity agreement except to the extent that it has been prejudiced in any material respect by such failure or from any liability that it may have otherwise than on account of this indemnity agreement. An indemnifying party may participate at its own expense in the defense of such action. If it so elects within a reasonable time after receipt of such notice, an indemnifying party, jointly with any other indemnifying parties receiving such notice, may assume the defense of such action with counsel chosen by it and approved by the indemnified parties defendant in such action, unless such indemnified parties reasonably object to such assumption on the ground that there may be legal defenses available to them that are different from or in addition to those available to such indemnifying party, in which case such indemnifying party cannot assume the control of the defense. Such firm shall be designated in writing by, in the case of parties indemnified under Section 9(b) hereof, the Representatives and, in the case of parties indemnified under Section 9(a) hereof, the Obligors. If an indemnifying party assumes the defense of such action, the indemnifying parties shall not be liable for any fees and expenses of counsel for the indemnified parties incurred thereafter in connection with such action. Fees and expenses to be paid by the indemnifying parties shall be reimbursed as they are incurred. In no event shall the indemnifying parties be liable for the fees and expenses of more than one counsel, including any local counsel, for all indemnified parties in connection with any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances. No indemnifying party shall, without the prior written consent of each indemnified party, effect any settlement of any pending or threatened proceeding in respect of which such indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability claims that are the subject matter of such proceeding. (d) Contribution. If the indemnification provided for in this Section 8 is unavailable to or insufficient to hold harmless an indemnified party under Section 8(a) or 8(b) hereof in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative benefits received by the Obligors on the one hand and the Underwriters on the other from the offering of the Securities. If, however, the allocation provided by the immediately preceding sentence is not permitted by applicable law, then such indemnifying party shall contribute to such amount paid or payable by such indemnified party in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Obligors on the one hand and the Underwriters on the other in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative benefits received by the Obligors on the one hand and the Underwriters on the other shall be deemed to be in the same proportion as the total net proceeds from the offering (before deducting expenses) received by the Obligors bear to the total underwriting discounts and commissions received by the Underwriters, in each case as set forth on the cover page of the Prospectus. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by either Obligor or the Underwriters and the parties' relative intent, knowledge, access to information 25 and opportunity to correct or prevent such statement or omission. The Underwriters and the Obligors agree that it would not be just and equitable if contribution pursuant to this Section 8(d) were determined by pro rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to above in this Section 8(d). The amount paid or payable to an indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in this Section 8(d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. (e) Confirmation of Certain Statements. The Underwriters confirm that the statements with respect to the public offering of the Series [__] Preferred Securities set forth in the last paragraph on the cover page of, and the statements with respect to the resale of any Series [__] Preferred Securities at a discount in the first paragraph under the list of Underwriters set forth under the caption "Underwriting" in, the Prospectus Supplement are correct and were furnished in writing to the Obligors by the Underwriters for inclusion in the Prospectus. 9. Termination. The Representatives may, by notice to the Obligors, terminate this Agreement at any time at or prior to the Closing Date, if (a) a banking moratorium shall have been declared either by federal authorities or authorities in the States of New York or Oregon, (b) trading in securities generally on the NYSE or of any securities of the Company shall have been suspended by the Commission, the NYSE or the Pacific Stock Exchange or there shall have been established by the Commission or the NYSE, any federal or state agency or the decision of any court any limitation on the prices for such trading or any restrictions on the distribution of such securities, (c) any outbreak or material escalation of hostilities or other calamity or crisis affecting the financial markets of the United States shall have occurred, (d) a downgrading shall have occurred in the ratings of any of the Preferred Securities or any preferred stock or first mortgage or first mortgage and collateral trust bonds of the Company by any "nationally recognized statistical rating organization" (as defined for purposes of Rule 15c3-1 of the Regulations under the Exchange Act), (e) a Tax Event shall have occurred or (f) any change in the business or properties of the Company or the Partnership shall have occurred, the effect of which is such as to make it impracticable to proceed with the sale or delivery of the Series [__] Preferred Securities and, in the case of any of the events specified in clauses (a) through (e) of this Section 9, the effect of such event, singly or together with any other such events, is such as to make it, in the judgment of the Representatives, impracticable to proceed with the sale or delivery of the Series [__] Preferred Securities. Any termination hereof pursuant to this Section 9 shall be without liability of any party to any other party except as otherwise provided in Section 5(j) hereof and except for any liability under Section 8 hereof. 10. Representations, Warranties and Agreements to Survive Delivery. All representations, warranties and agreements contained in this Agreement, or contained in certificates signed by officers of the Company, on behalf of itself or as the General Partner on behalf of the Partnership, submitted pursuant hereto, shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of any Underwriter or any controlling person of any Underwriter, or by or on behalf of either Obligor, and shall survive delivery of the Series [__] Preferred Securities to the Underwriters. 26 11. Miscellaneous. The validity and interpretation of this Agreement shall be governed by the laws of the State of New York. This Agreement shall inure to the benefit of the Obligors and the Underwriters and, with respect to the provisions of Section 8 hereof, each controlling person referred to in Section 8 hereof, and their respective successors, assigns, executors and administrators. Nothing in this Agreement is intended or shall be construed to give to any other person, firm or corporation any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained. The term "successors" as used in this Agreement shall not include any purchaser, as such purchaser, of any of the Series [__] Preferred Securities from any of the Underwriters. This Agreement may be executed in any number of separate counterparts all of which together shall constitute the same Agreement. 12. Notices and Authority to Act. All communications hereunder shall be in writing (which may be telex or facsimile transmission) and effective only upon receipt and, if to the Underwriters, shall be sent to the Representatives at the address set forth above, Attention of [_____] and, if to either Obligor, shall be sent to it at PacifiCorp, 700 N.E. Multnomah, Suite 1600, Portland, Oregon 97232, Attention of Richard T. O'Brien, Vice President. 27 If the foregoing is in accordance with your understanding of our agreement, kindly sign and return to the Obligors the enclosed duplicate hereof, whereupon this letter will become a binding agreement among the Obligors and the several Underwriters in accordance with its terms. Very truly yours, PacifiCorp By _____________________________ Name: Title: PacifiCorp Delaware, L.P. By PacifiCorp, as the General Partner By ______________________________ Name: Title: Accepted as of the date first above written: Goldman, Sachs & Co. Smith Barney Inc. [insert names of other Representatives] By:_____________________________ (Goldman, Sachs & Co.) As representatives of the other several Underwriters named in Schedule I hereto SCHEDULE I Number of Series [__] Underwriter Preferred Securities - ----------- --------------------- Goldman, Sachs & Co. Smith Barney Inc. Total ============= EX-1 3 Exhibit 1(b) Form of Underwriting Agreement relating to Junior Subordinated Debentures PacifiCorp Series [__] Junior Subordinated Debentures UNDERWRITING AGREEMENT [______] Goldman, Sachs & Co. Smith Barney Inc. [insert names of other Representatives] As representatives of the several Underwriters named in Schedule I hereto c/o Goldman, Sachs & Co. 85 Broad Street New York, New York 10004 Ladies and Gentlemen: The undersigned, PacifiCorp, an Oregon corporation (the "Company"), hereby confirms its agreement with the several Underwriters (as defined in Section 1 hereof), for whom you are acting as representatives (in such capacity, you shall hereinafter be referred to as the "Representatives"), as follows: 1. Definitions of Certain Terms. Except as may otherwise be defined herein, capitalized terms used herein shall have the following meanings: (a) "Act" shall mean the Securities Act of 1933, as amended. 2 (b) "Articles" shall mean the Second Restated Articles of Incorporation of the Company, as amended. (c) "Business Day" shall mean any day on which the NYSE and banks in the City of New York are open. (d) "Commission" shall mean the Securities and Exchange Commission. (e) "Counsel for the Company" shall mean Stoel Rives Boley Jones & Grey. (f) "Counsel for the Underwriters" shall mean Winthrop, Stimson, Putnam & Roberts. (g) "Debentures" shall mean junior subordinated debentures of the Company issued under the Indenture having an aggregate initial offering price of up to $150,000,000. (h) "Effective Date" shall mean, at any time, the later of (i) the date that the Registration Statement or any post- effective amendment thereto was or is declared effective by the Commission under the Act and (ii) the date that the Company's Annual Report on Form 10-K for its most recently completed fiscal year is filed with the Commission under the Exchange Act, in each case at such time. (i) "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended. (j) "Guarantee" shall mean the Company's guarantee of the payment of dividends on, and amounts due upon the redemption of or upon the Partnership's liquidation with respect to, the Preferred Securities pursuant to the Guaranty Agreement dated as of [_____] entered into by the Company. (k) "Incorporated Documents" shall mean the documents filed by the Company with the Commission under the Exchange Act that are, or are deemed to be, incorporated by reference in the Prospectus pursuant to Item 12 of Form S-3 under the Act. (l) "Indenture" shall mean the Indenture dated as of [_____] between the Company and The Bank of New York, as trustee (the "Trustee"), as [heretofore] supplemented and amended[, including] by the [_____] Supplemental Indenture dated as of [_____]. (m) "Preferred Securities" shall mean up to 6,000,000 Monthly Income Preferred Securities representing limited partner interests in PacifiCorp Delaware, L.P., a Delaware limited partnership, and otherwise having the terms set forth in the Prospectus. (n) "NYSE" shall mean the New York Stock Exchange. 3 (o) "Prospectus" shall mean the prospectus relating to the Debentures, the Preferred Securities and the Guarantee included in the Registration Statement, as supplemented by a prospectus supplement specifying the terms of the Series [__] Debentures and the plan of distribution thereof (the "Prospectus Supplement"), as first filed pursuant to Rule 424(b) of the Regulations under the Act, including the Incorporated Documents. (p) "Registration Statement" shall mean the registration statement on Form S-3 (No. 33-55309) filed with the Commission for the registration under the Act of the Debentures, the Preferred Securities and the Guarantee, as amended and supplemented to the date of this Agreement, and shall be deemed to include the Incorporated Documents. (q) "Regulations" shall mean the applicable published rules and regulations of the Commission under the Act, the Exchange Act or the Trust Indenture Act, as the case may be. (r) "Series [__] Debentures" shall mean $[_____] aggregate principal amount of Debentures designated [__]% Deferrable Interest Junior Subordinated Debentures, Series [__], Due [____] having the terms set forth in the Prospectus. (s) "Trust Indenture Act" shall mean the Trust Indenture Act of 1939, as amended. (t) "Underwriters" shall mean the several firms or corporations named in Schedule I hereto and any underwriter substituted as provided in Section 4(c) hereof and "Underwriter" shall mean one of the Underwriters. (u) "amend," "amendment," "amended," "supplement" or "supplemented" with respect to the Registration Statement or the Prospectus shall mean amendments or supplements to the Registration Statement or the Prospectus, as the case may be, and Incorporated Documents filed after the date of this Agreement and prior to the completion of the distribution of the Series [__] Debentures. 2. Purchase and Sale. Upon the basis of the representations and warranties herein contained, and subject to the terms and conditions set forth in this Agreement, the Company agrees to sell to each Underwriter named in Schedule I hereto, severally and not jointly, and such Underwriter agrees, severally and not jointly, to purchase from the Company, the principal amount of Series [__] Debentures set forth opposite such Underwriter's name in Schedule I hereto at a purchase price of [__]% of the principal amount thereof. The Representatives represent that they have been authorized by each Underwriter to enter into this Agreement on behalf of such Underwriter, to confirm the statements described in Section 8(e) hereof and to act for it in the manner herein provided. All obligations of the Underwriters hereunder are several and not joint. 4 The Company has been advised by the Representatives that the Underwriters propose to (i) make a public offering of the Series [__] Debentures as soon as the Underwriters deem advisable after this Agreement has been executed and delivered and (ii) initially offer the Series [__] Debentures to the public at the public offering price set forth in the Prospectus. 3. Representations and Warranties of Company. The Company represents and warrants to, and agrees with, the several Underwriters as follows: (a) Filing of Registration Statement and any Preliminary Prospectus with Commission. The Company meets the requirements for use of Form S-3 under the Act and the Company has filed with the Commission the Registration Statement and each preliminary prospectus relating to the Series [__] Debentures required to be filed pursuant to Rule 424 of the Regulations under the Act; and the Registration Statement has been declared effective by the Commission under the Act and meets the requirements set forth in paragraph (a)(1)(ix) or (a)(1)(x) of Rule 415 of the Regulations under the Act and complies in all other material respects with such Rule 415. (b) Registration Statement; Prospectus; Incorporated Documents. (i) The Registration Statement, at the Effective Date, and each preliminary prospectus relating to the Series [__] Debentures, if any, at the time it was filed with the Commission, complied and the Prospectus, at the time it is filed with the Commission, will comply, except in each case for Incorporated Documents, in all material respects with the applicable requirements of the Act and the Trust Indenture Act and the respective Regulations thereunder; (ii) the Registration Statement, at the Effective Date, did not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading; (iii) the Prospectus, at the time it is filed with the Commission, will not and each preliminary prospectus relating to the Series [__] Debentures, if any, at the time it was filed with the Commission, did not include an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; and (iv) each Incorporated Document, at the time originally filed with the Commission pursuant to the Exchange Act, complied and will comply, as the case may be, in all material respects with the applicable requirements of the Exchange Act and the Regulations thereunder; provided, however, that the Company makes no representation or warranty as to (A) such part of the Registration Statement that constitutes the Statement of Eligibility on Form T-1 under the Trust Indenture Act of the Trustee or (B) the information contained in or omitted from the Registration Statement or the Prospectus in reliance upon and in conformity with information furnished in writing to the Company by the Representatives specifically for use in connection with the preparation of the Registration Statement or the Prospectus. (c) Financial Statements. The consolidated financial statements included or incorporated by reference in the Registration Statement and the Prospectus present fairly the financial 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 5 accounting principles consistently applied throughout the periods involved except as otherwise indicated in the Registration Statement and the Prospectus; and Deloitte & Touche LLP, who examined the audited financial statements, are independent public accountants as required by the Act and the Regulations thereunder. (d) Material Changes or Transactions. Except as reflected in, or contemplated by, the Registration Statement and the Prospectus, since the respective most recent dates as of which information is given in the Registration Statement and the Prospectus, there has not been any material adverse change in the business, affairs, business prospects, property or financial condition of the Company, whether or not arising in the ordinary course of business, and since such dates there has not been any material transaction entered into by the Company other than transactions contemplated by the Registration Statement and the Prospectus, and transactions in the ordinary course of business; and the Company has no material contingent obligation that is not disclosed in the Registration Statement and the Prospectus. (e) No Defaults. The Company is not in violation of the Articles or its Bylaws, as amended, or in default in the performance or observance of any material obligation, agreement, covenant or condition contained in any contract, agreement or other instrument to which it is a party or by which it may be bound, the effect of which is material to the Company and its subsidiaries taken as a whole, and neither the execution or delivery of this Agreement, the consummation of the transactions herein contemplated, the fulfillment of the terms hereof nor compliance with the terms and provisions hereof will conflict with, or result in a breach of, or constitute a default under, (i) the Articles or the Company's Bylaws, as amended, or any material contract, agreement or other instrument that the Company has assumed or to which it is now a party or by which it may be bound or (ii) any order, rule or regulation applicable to the Company of any court or any federal or state regulatory body or administrative agency or other governmental body having jurisdiction over the Company or its properties. (f) Due Incorporation and Qualification of Company. The Company has been duly incorporated and is validly existing as a corporation under the laws of the State of Oregon with corporate power and corporate authority to own its properties and conduct its business as described in the Prospectus and to execute and deliver, and perform its obligations under, this Agreement, the Indenture and the Series [__] Debentures; and the Company is duly qualified as a foreign corporation to transact business and is in good standing in each jurisdiction in which it owns or leases substantial properties or in which the conduct of its business requires such qualification, except where the failure to so qualify would not have a material adverse effect on the financial condition of the Company and its subsidiaries taken as a whole. (g) Agreement. This Agreement has been duly authorized, executed and delivered by the Company and is a valid and legally binding agreement of the Company enforceable in accordance with its terms, except as limited by bankruptcy, insolvency, fraudulent conveyance, reorganization and other similar laws relating to or affecting creditors' rights generally and general equitable principles (whether considered in a 6 proceeding in equity or at law) and subject to any principles of public policy limiting the right to enforce the indemnification and contribution provisions contained herein. (h) Indenture. The Indenture has been duly authorized, executed and delivered by the Company, has been duly qualified under the Trust Indenture Act and is a valid and legally binding agreement of the Company enforceable in accordance with its terms, except as limited by bankruptcy, 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). (i) Series [__] Debentures. The Series [__] Debentures have been duly authorized and, when authenticated and delivered in accordance with the Indenture and paid for by the purchasers thereof, will constitute valid and legally binding obligations of the Company enforceable in accordance with their respective terms, except as limited by bankruptcy, insolvency, fraudulent conveyance, reorganization and other similar laws relating to or affecting creditors' rights generally and general equitable principles (whether considered in a proceeding in equity or at law); and the Series [__] Debentures conform to all statements relating thereto contained in the Registration Statement and the Prospectus. (j) Capital Stock. The authorized, issued and outstanding capital stock of the Company is as set forth in the Registration Statement and the Prospectus (except for changes referred to therein or contemplated thereby and additional shares offered under the Company's Dividend Reinvestment and Stock Purchase Plan, K Plus Employee Savings and Stock Ownership Plan or Utah Power & Light Company Employee Savings and Stock Purchase Plan). Any certificate signed by any officer of the Company and delivered to the Representatives or to Counsel for the Underwriters shall be deemed a representation and warranty by the Company to each Underwriter as to the statements made therein. 4. Closing; Delivery of Series [__] Debentures; Defaulting Underwriters. (a) Closing. Delivery of the Series [__] Debentures to the Underwriters, against payment of the purchase price therefor in next day funds by certified or bank check or checks payable to the order of the Company and drawn on a bank which is a member of the New York Clearing House Association, shall be made prior to 1:00 P.M., New York City time, on [_____] through the facilities of The Depository Trust Company ("DTC"), or at such other time, date and location as may be agreed upon in writing by the Company and the Representatives. Delivery of the documents required by Section 6 hereof shall be made at such time and date at the offices of [_____], or at such other location as may be agreed upon in writing by the Company and the Representatives. The hour and date of such delivery and payment are herein called the "Closing Date." (b) Delivery of Series [__] Debentures. The Series [__] Debentures shall be registered in the name of "Cede & Co.," as nominee of DTC, and delivered to DTC in such denominations as the Representatives may reasonably request in writing not later than 7 12:30 P.M., New York City time, on the third Business Day prior to the Closing Date or, to the extent not so requested, in such authorized denominations as the Company shall determine. For the purpose of expediting the checking of the Series [__] Debentures by the Representatives on behalf of the Underwriters, the Company agrees to make the Series [__] Debentures available to the Representatives for such purpose at the offices of DTC in New York, New York, not later than 2:00 P.M., New York City time, on the Business Day preceding the Closing Date or at such other time and place as may be agreed upon by the Company and the Representatives. (c) Defaulting Underwriters. If on the Closing Date any Underwriter shall fail to purchase and pay for the Series [__] Debentures that such Underwriter has agreed to purchase and pay for hereunder on such date (otherwise than by reason of any failure on the part of the Company to comply with any of the provisions contained herein), the non-defaulting Underwriters shall be obligated, severally and not jointly, to take up and pay for (in addition to the respective principal amount of Series [__] Debentures set forth opposite their respective names in Schedule I hereto) the principal amount of Series [__] Debentures that such defaulting Underwriter or Underwriters failed to take up and pay for, up to a principal amount of Series [__] Debentures equal to, in the case of each such non-defaulting Underwriter, ten percent (10%) of the principal amount of Series [__] Debentures set forth opposite the name of such non-defaulting Underwriter in Schedule I hereto and such non-defaulting Underwriters shall have the right, within 24 hours of such default, either to take up and pay for (in such proportion as may be agreed upon among them), or to substitute another Underwriter or Underwriters, satisfactory to the Company, to take up and pay for, the remaining principal amount of Series [__] Debentures that the defaulting Underwriter or Underwriters agreed but failed to purchase. If any unpurchased Series [__] Debentures still remain, then the Company shall be entitled to a further period of 24 hours within which to procure another party or other parties, members of the National Association of Securities Dealers, Inc. (or, if not members of such Association, who are not eligible for membership in such Association and who agree (i) to make no sales within the United States, its territories or its possessions or to persons who are citizens thereof or residents therein and (ii) in making sales to comply with such Association's Rules of Fair Practice) and satisfactory to the Representatives, to purchase such Series [__] Debentures on the terms herein set forth. In the event that, within the respective prescribed periods, the non-defaulting Underwriters notify the Company that they have arranged for the purchase of such Series [__] Debentures, or the Company notifies the non-defaulting Underwriters that it has arranged for the purchase of such Series [__] Debentures, then the non-defaulting Underwriters or the Company shall have the right to postpone the Closing Date for a period of not more than three full Business Days beyond the expiration of the respective prescribed periods in order to effect whatever changes may thus be made necessary in the Registration Statements or the Prospectus or in any other documents or arrangements. In the event that none of the non-defaulting Underwriters or the Company has arranged for the purchase of such Series [__] Debentures by another party or parties as above provided, then this Agreement shall terminate without any liability on the part of the Company or any Underwriter (other than an Underwriter which shall have failed or refused, otherwise than for some reason sufficient to justify, in accordance with the terms hereof, the cancellation or termination of its obligations hereunder, to purchase and pay for the Series [__] Debentures that such Underwriter has agreed to purchase as provided in Section 2 hereof), except as otherwise provided in Section 5(j) hereof. 8 5. Covenants of Company. The Company covenants and agrees with the Underwriters that: (a) Filing of Prospectus. The Company will promptly transmit copies of the Prospectus, and any amendments or supplements thereto, to the Commission for filing pursuant to Rule 424(b) of the Regulations under the Act. (b) Copies of Registration Statement and Prospectus; Stop Orders. The Company will deliver to each of the Representatives and Counsel for the Underwriters (i) one signed copy of the Registration Statement as originally filed, including copies of exhibits thereto (other than any exhibits incorporated by reference therein), (ii) signed copies of any amendments and supplements to the Registration Statement, including copies of the Incorporated Documents (other than exhibits thereto), and (iii) a signed copy of each consent and certificate included or incorporated by reference in, or filed as an exhibit to, the Registration Statement as so amended or supplemented; the Company will deliver to the Underwriters through the Representatives as soon as practicable after the date of this Agreement as many copies of the Prospectus as the Representatives may reasonably request for the purposes contemplated by the Act; the Company will promptly advise the Representatives of the issuance of any stop order under the Act with respect to the Registration Statement (as it may be amended or supplemented) or the institution of any proceedings therefor, or the suspension of the qualification of the Series [__] Debentures for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose, of which the Company shall have received notice prior to the completion of the distribution of the Series [__] Debentures; and the Company will use its best efforts to prevent the issuance of any such stop order and to secure the prompt removal thereof, if issued. (c) Filing of Amendments and Supplements. During the period when a prospectus relating to the Series [__] Debentures is required to be delivered under the Act by any Underwriter or dealer, the Company will not file any amendment or supplement to the Registration Statement, the Prospectus (including a prospectus relating to the Series [__] Debentures filed pursuant to Rule 424(b) of the Regulations under the Act that differs from the Prospectus as first filed pursuant to such Rule 424(b)) or any Incorporated Document to which Goldman, Sachs & Co. shall reasonably object as to substance or Counsel for the Underwriters shall reasonably object as to form. (d) Compliance with Act. During the period when a prospectus relating to the Series [__] Debentures is required to be delivered under the Act by any Underwriter or dealer, the Company will comply so far as it is able, and at its own expense, with all requirements imposed upon it by the Act, as now and hereafter amended, and by the Regulations thereunder, as from time to time in force, so far as necessary to permit the continuance of sales of or dealing in the Series [__] Debentures during such period in accordance with the provisions hereof and the Prospectus. (e) Certain Events and Amendments or Supplements. If, during the period when a prospectus relating to the Series [__] Debentures is required to be delivered under the Act by any Underwriter or dealer, (i) any event relating to or affecting the Company 9 or of which the Company shall be advised in writing by the Representatives shall occur as a result of which, in the opinion of the Company, the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading or (ii) it shall be necessary to amend or supplement the Registration Statement or the Prospectus to comply with the Act, the Exchange Act or the Trust Indenture Act or the respective Regulations thereunder, the Company will forthwith at its expense prepare and furnish to the Representatives a reasonable number of copies of such amendment or supplement that will correct such statement or omission or effect such compliance; provided, however, that should such event relate solely to activities of any of the Underwriters, then the Underwriters will assume the expense of preparing and furnishing copies of any such amendment or supplement. Notwithstanding the foregoing, in case any Underwriter is required to deliver a prospectus relating to the Series [__] Debentures after the expiration of nine months after the date of this Agreement, the Company upon the request of the Representatives will furnish to the Representatives, at the expense of such Underwriter, a reasonable quantity of a supplemented or amended Prospectus or supplements or amendments to the Prospectus complying with Section 10 of the Act. (f) Blue Sky Qualifications. During the time a prospectus relating to the Series [__] Debentures is required to be delivered under the Act by any Underwriter or dealer, the Company will furnish such proper information as may be lawfully required and otherwise cooperate in qualifying the Series [__] Debentures for offer and sale under the blue sky laws of such jurisdictions as the Representatives may reasonably designate and will file and make in each year such statements or reports as are or may be reasonably required by laws of such jurisdictions; provided, however, that the Company shall not be required to qualify as a foreign corporation or dealer in securities or to file any consents to service of process under the laws of any jurisdiction. (g) Earning Statement. In accordance with Rule 158 of the Regulations under the Act, the Company will make generally available to its security holders, as soon as practicable, an earning statement (which need not be audited) in reasonable detail covering the 12 months beginning not later than the first day of the month next succeeding the month in which occurred the effective date (within the meaning of Rule 158 of the Regulations under the Act) of the Registration Statement. (h) Reports. The Company will furnish to the holders of the Series [__] Debentures as soon as practicable after the end of each fiscal year an annual report (including a balance sheet and statements of income, stockholders' equity and cash flow of the Company and its consolidated subsidiaries certified by independent public accountants) and, as soon as practicable after the end of each of the first three quarters of each fiscal year (beginning with the first such fiscal quarter ending after the effective date of the Registration Statement), consolidated summary financial information of the Company and its subsidiaries for such quarter in reasonable detail. (i) Exchange Act Documents; Ratings Notification. The Company, during the period when a prospectus relating to any of the Securities is required to be delivered 10 under the Act by any Underwriter or dealer, will file promptly all documents required to be filed with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act; and the Company will promptly notify the Representatives of any written notice given to the Company by any "nationally recognized statistical rating organization" (as defined for purposes of Rule 15c3-1 under the Exchange Act) of any intended decrease in any rating of any of the Debentures or any preferred stock or first mortgage or first mortgage and collateral trust bonds of the Company or of any intended change in any such rating that does not indicate the direction of the possible change, in each case by any such rating organization. (j) Payment of Expenses. Whether or not the transactions contemplated hereunder are consummated or this Agreement is terminated, the Company will pay, except as otherwise expressly provided herein, all expenses incident to the performance of its obligations under this Agreement, including (i) the preparation and filing of the Registration Statement and the Prospectus (and any amendments or supplements thereto), any preliminary prospectus relating to the Series [__] Debentures and any Incorporated Documents and exhibits thereto, and this Agreement, (ii) the issuance and delivery of the Series [__] Debentures to the Underwriters, (iii) the fees and disbursements of the Company's counsel and accountants, (iv) the fees and expenses of the Trustee and its counsel, (v) the fees and expenses in connection with the rating of the Series [__] Debentures by securities rating organizations, (vi) the expenses in connection with the qualification of the Series [__] Debentures under securities laws in accordance with the provisions of Section 5(f) hereof, including filing fees and the reasonable fees and disbursements of Counsel for the Underwriters in connection therewith and in connection with the preparation of any Blue Sky Survey, (vii) the printing and delivery to the Underwriters of copies of the Registration Statement and the Prospectus (and any amendments or supplements thereto) and the Incorporated Documents and (viii) the printing and delivery to the Underwriters of copies of any Blue Sky Survey [if, in the judgment of the Representatives, it shall be necessary or advisable to list the Series [__] Debentures on the NYSE, then insert: and the fees and expenses in connection with any listing of the Series [__] Debentures on the NYSE and the registration thereof under the Exchange Act in accordance with Section 5(l) hereof]. If this Agreement is terminated in accordance with the provisions of Section 6, 7 or 9 hereof, or if this Agreement is terminated pursuant to Section 4 hereof and could have been terminated in accordance with the provisions of Section 6, 7 or 9 hereof, the Company will reimburse the Representatives for the account of the Underwriters for their reasonable out-of-pocket expenses in an amount not exceeding $15,000 in the aggregate, and reasonable counsel fees and disbursements; provided, however, that if the Representatives terminate this Agreement pursuant to Section 9(d) hereof, the Company shall not be obligated to reimburse the Representatives for their out-of-pocket expenses or for their counsel fees and disbursements. The Company shall not be required to pay any amount for any expenses of the Representatives or of any other of the Underwriters except as provided in this Section 5(j). The Company shall not in any event be liable to any of the Underwriters for damages on account of the loss of anticipated profits. (k) No Issuance Period. During the 30 days following the Closing Date, the Company will not, without the prior written consent of the Representatives, offer for 11 sale, sell or enter into any agreement to sell, or otherwise dispose of, any Series [__] Debentures or any preferred stock or other securities of the Company that are substantially similar to the Series [__] Debentures or any securities convertible into or exchangeable for Series [__] Debentures, preferred stock or such substantially similar securities of the Company. [If, in the judgment of the Representatives, it shall be necessary or advisable to list the Series [__] Debentures on the NYSE, then insert: (l) Listing and Registration. The Company will take, or cause to be taken, all actions necessary or advisable to effect the listing and admission for trading of the Series [__] Debentures on the NYSE and the registration thereof under the Exchange Act.] 6. Conditions to Underwriters' Obligations. The several obligations of the Underwriters hereunder to purchase the Series [__] Debentures shall be subject to the continuing accuracy of, and compliance with, the representations and warranties of the Company contained herein on the Closing Date (with the same force and effect as though expressly made on and as of the Closing Date, except that references therein to the Registration Statement and the Prospectus shall include any amendments or supplements thereto at the Closing Date), to the performance by the Company of its obligations to be performed hereunder on or prior to the Closing Date and to the following further conditions: (a) Filing of Prospectus with Commission; No Stop Order; Regulatory Approvals. The Prospectus, and any amendments or supplements thereto, shall have been filed in the manner and within the time period required by Rule 424(b) of the Regulations under the Act; no stop order suspending the effectiveness of the Registration Statement under the Act shall have been issued and no proceedings for that purpose shall have been instituted or threatened; [if, in the judgment of the Representatives, it shall be necessary or advisable to list the Series [__] Debentures on the NYSE, then insert: no order suspending trading or striking or withdrawing the Series [__] Debentures from listing on the NYSE or registration thereof under the Exchange Act shall be in effect, no proceedings for such purpose shall be pending before or threatened by the NYSE and all requests for additional information on the part of the Commission shall have been complied with;] the orders of the public utility regulatory authorities in the States of Idaho, Montana, Oregon, Utah, and Wyoming each authorizing the issuance and sale of the Series [__] Debentures by the Company as contemplated by this Agreement, the order dated April 27, 1988 of the California Public Utilities Commission exempting any issuance of securities of the Company from its jurisdiction and the order of the Washington Utilities and Transportation Commission as to the compliance by the Company with the filing requirements of RCW 80.08.040 shall be in full force and effect and shall not then be either contested or the subject of review or appeal, and such orders constitute the only approval, authorization, consent or other order of any governmental body legally required for the authorization of the issuance and sale of the Series [__] Debentures by the Company pursuant to the terms of this Agreement, except such as may be required under the Act or under state or other securities or blue sky laws; and the Company shall have delivered to the Representatives a certificate of the Company signed 12 by the President or any Vice President of the Company, dated the Closing Date, to such effect with copies attached thereto of such orders and of evidence of qualification of the Company to transact business as a foreign corporation in each jurisdiction in which it owns or leases substantial properties or in which the conduct of its business requires such qualification, except where the failure to so qualify would not have a material adverse effect on the financial condition of the Company and its subsidiaries taken as a whole. (b) Opinion of Counsel for Company. On the Closing Date, the Representatives shall have received an opinion of Counsel for the Company, dated as of the Closing Date, in form and substance satisfactory to Counsel for the Underwriters, to the effect that: (i) the Company is a duly organized and validly existing corporation under the laws of the State of Oregon; (ii) the Company has due corporate right and corporate authority to own its properties and to carry on the business in which it is engaged as described in the Prospectus and to execute and deliver, and perform its obligations under, this Agreement, the Indenture and the Series [__] Debentures; (iii) the terms of the Series [__] Debentures conform as to legal matters to the description thereof and the statements in regard thereto contained in the Registration Statement and the Prospectus; and the specimen of the Series [__] Debentures are in due and proper form; (iv) the Indenture has been duly authorized, executed and delivered by the Company, has been duly qualified under the Trust Indenture Act and is a valid and legally binding agreement of the Company enforceable in accordance with its terms, except as limited by bankruptcy, 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); (v) the Series [__] Debentures have been duly authorized and executed by the Company and, when authenticated and delivered in accordance with the Indenture and paid for by the purchasers thereof in accordance with this Agreement, will constitute valid and legally binding agreements of the Company enforceable in accordance with their respective terms, except as limited by bankruptcy, 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); [if, in the judgment of the Representatives, it shall be necessary or advisable to list the Series [__] Debentures on the NYSE, then insert: and the Series [__] Debentures have been listed (subject to official notice of issuance) on the NYSE]. (vi) this Agreement has been duly authorized, executed and delivered by the Company; 13 (vii) the Idaho Public Utilities Commission, the Montana Public Service Commission, the Public Utility Commission of Oregon, the Utah Public Service Commission and the Public Service Commission of Wyoming have entered appropriate orders, which to the best knowledge of such counsel remain in full force and effect on the date of such opinion, each authorizing the issuance and sale of the Series [__] Debentures by the Company; the Washington Utilities and Transportation Commission has entered an appropriate order, which to the knowledge of such counsel remains in full force and effect on the date of such opinion, as to the compliance by the Company with the filing requirements of RCW 80.08.040; and such orders constitute the only approval, authorization, consent or other order of any governmental body legally required for the authorization of the issuance and sale of the Series [__] Debentures by the Company pursuant to the terms of this Agreement, except such as may be required under the Act or under state or other securities or blue sky laws; (viii) the consummation of the transactions contemplated by this Agreement and the fulfillment of the terms hereof will not conflict with or result in a breach of any of the terms or provisions of, or constitute a default under, (i) the Articles or Bylaws of the Company, as amended, or any indenture, mortgage, deed of trust or other material agreement for money borrowed the terms of which are known to such counsel to which the Company is a party or by which it may be bound or (ii) any order, rule or regulation applicable to the Company of any court or any federal or state regulatory body or administrative agency or other governmental body having jurisdiction over the Company or its properties; (ix) the Registration Statement, at the Effective Date, and the Prospectus, at the time it was filed pursuant to Rule 424(b) of the Regulations under the Act (except in each case as to financial statements and other financial and statistical data contained therein, upon which such opinion need not pass, and except for Incorporated Documents), complied as to form in all material respects with the requirements of the Act and the Trust Indenture Act and the respective Regulations thereunder; each Incorporated Document as originally filed pursuant to the Exchange Act (except as to financial statements and other financial and statistical data contained therein, upon which such opinion need not pass) complied as to form when so filed in all material respects with the requirements of the Exchange Act and the Regulations thereunder; the Registration Statement has become, and on the Closing Date is, effective under the Act and, to the best of such counsel's knowledge, no proceedings for a stop order with respect thereto are threatened or pending under Section 8 of the Act; and nothing has come to the attention of such counsel that has caused them to believe that the Registration Statement (except as to financial statements and other financial and statistical data contained therein, upon which such opinion need not pass), at the Effective Date, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that the Prospectus (except as to financial statements and other financial and statistical data contained therein, upon which such opinion need not pass), at the time it was filed pursuant to Rule 424(b) of the Regulations under 14 the Act or on the Closing Date, included or includes an untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; (x) those portions of the Registration Statement or the Prospectus that are stated therein to have been made on the authority of such counsel have been reviewed by such counsel and, as to matters of law and legal conclusions, are correct; and (xi) to the best of such counsel's knowledge and information, there are no legal or governmental proceedings pending or threatened against the Company or its subsidiaries that are required to be disclosed in the Registration Statement and the Prospectus other than those disclosed therein. In rendering such opinion, Counsel for the Company may rely as to matters of fact, to the extent deemed proper, on certificates of responsible officers of the Company and its subsidiaries and public officials. References to the Registration Statement and the Prospectus in this Section 6(b) shall include any amendments or supplements thereto at the date such opinion is rendered. (c) Opinion of Counsel for Underwriters. On the Closing Date, the Representatives shall have received an opinion of Counsel for the Underwriters, dated as of the Closing Date, with respect to the matters set forth in paragraphs (i), (iii), (iv), (v), (vi) and (vii) and the first, third and fourth clauses of paragraph (ix) of Section 6(b) hereof and other related matters as the Representatives may reasonably require, and the Company shall have furnished to Counsel for the Underwriters such documents as they request for the purpose of enabling them to pass upon such matters. In rendering such opinion, Counsel for the Underwriters may rely (i) as to matters of fact, to the extent deemed proper, on certificates of responsible officers of the Company and (ii) upon the opinion of Counsel for the Company rendered pursuant to Section 6(b) as to matters involving the application of laws other than the laws of the State of New York. (d) Letter of Accountants. On the Closing Date, Deloitte & Touche LLP shall have furnished to the Representatives a letter or letters, dated as of the Closing Date, in form and substance satisfactory to the Representatives, confirming that they are independent accountants within the meaning of the Act and the Regulations thereunder with respect to the Company and its subsidiaries and stating in effect that: (i) in their opinion, the consolidated financial statements and schedules included or incorporated by reference in the 15 Registration Statement and the Prospectus and audited by them comply as to form in all material respects with the applicable accounting requirements of the Act and the Regulations thereunder; (ii) on the basis of a reading of the unaudited consolidated financial statements, if any, included or incorporated by reference in the Registration Statement and the Prospectus and the latest available interim unaudited consolidated financial statements of the Company, the performance of the procedures specified by the American Institute of Certified Public Accountants for a review of any such unaudited consolidated financial information as described in Statement on Auditing Standards No. 71, inquiries of officials of the Company responsible for financial and accounting matters and a reading of the minutes of meetings of the shareholders and the Board of Directors of the Company and the Finance and Pricing Committees thereof through a specified date not more than five Business Days prior to the Closing Date, nothing came to their attention that caused them to believe that: (A) any material modification should be made to the unaudited consolidated financial statements, if any, included or incorporated by reference in the Registration Statement and the Prospectus for them to be in conformity with generally accepted accounting principles or any such unaudited consolidated financial statements do not comply as to form in all material respects with the applicable accounting requirements of the Act or the Regulations thereunder; (B) for the twelve months ended as of the date of the latest available financial statements of the Company, there were any decreases in revenues, earnings on common stock or earnings per common share as compared with the comparable period of the preceding year; or (C) at the date of the latest available financial statements of the Company and at a subsequent date not more than five Business Days prior to the Closing Date, there was any change in the capital stock (except for sales under the Company's Dividend Reinvestment and Stock Purchase Plan, K Plus Employee Savings and Stock Ownership Plan or Utah Power & Light Company Employee Savings and Stock Purchase Plan of PacifiCorp) or long-term debt of the Company or any decrease in its net assets as compared with the amounts shown in the most recent consolidated balance sheet included or incorporated by reference in the Registration Statement and the Prospectus, except in all instances for changes or decreases that the Registration Statement or the Prospectus discloses have occurred or may occur, or for changes or decreases that are described in such letter that are reasonably satisfactory to the Representatives; (iii) if unaudited pro forma financial statements are included or incorporated by reference in the Registration Statement and the Prospectus, on the basis of a reading of such financial statements, carrying out certain specified procedures, inquiries of certain officials of the Company and the company acquired or to be acquired who have responsibility for financial and accounting matters and proving the arithmetic accuracy of the application of the pro forma adjustments to the historical amounts in such pro forma financial statements, nothing came to their attention that caused them to believe that such pro forma financial statements do not comply in form in all material respects with the applicable accounting requirements of Rule 11-02 of Regulation S-X or that such pro forma adjustments have not been properly applied to such historical amounts in the compilation of such pro forma financial statements; and (iv) covering such other matters as the Representatives shall reasonably request, including but not limited to the "Management's Discussion 16 and Analysis of Financial Condition and Results of Operations" contained in the financial statements included or incorporated by reference in the Registration Statement and the Prospectus and any other information of an accounting, financial or statistical nature included therein. References to the Registration Statement and the Prospectus in this Section 6(d) shall include any amendments or supplements thereto at the Closing Date. (e) Certificate. On the Closing Date, there shall not have been, since the respective dates as of which information is given in the Registration Statement and the Prospectus, as they may then be amended or supplemented, except as may otherwise be stated therein or contemplated thereby, any material adverse change in the condition of the Company and its subsidiaries taken as a whole, financial or otherwise, or in the earnings, affairs or business prospects of the Company and its subsidiaries taken as a whole, whether or not arising in the ordinary course of business, and the Representatives shall have received a certificate of the Company signed by the President or any Vice President of the Company reasonably satisfactory to the Representatives, dated as of the Closing Date, to the effect that (i) there has been no such material adverse change, (ii) the other representations and warranties on the part of the Company contained in this Agreement are true and correct (with the same force and effect as though expressly made on and as of the Closing Date, except that references therein to the Registration Statement and the Prospectus shall include any amendments or supplements thereto at such dates), (iii) the Company has complied with all agreements and satisfied all conditions on its part to be performed or satisfied under this Agreement on or prior to the Closing Date and (iv) no stop order suspending the effectiveness of the Registration Statement (as so amended or supplemented) has been issued and no proceedings for the purpose have been initiated or threatened by the Commission. (f) Ratings. Moody's Investors Service, Inc. and Standard & Poor's Ratings Group shall have publicly assigned to the Series [__] Debentures ratings of [__] and [__], respectively, which ratings shall be in full force and effect on the Closing Date. [If, in the judgment of the Representatives, it shall be necessary or advisable to list the Series [__] Debentures on the NYSE, then insert: (g) Listing and Registration. On the Closing Date, (i) the NYSE shall have approved the Series [__] Debentures for listing and admission for trading, subject to official notice of issuance, and (ii) the Company's registration statement on Form 8-A relating to the Series [__] Debentures shall have become effective under the Exchange Act.] [(h)][(g)]Other Documents. On the Closing Date, Counsel for the Underwriters shall have been furnished with such documents and opinions as they may reasonably require for the purpose of enabling them to pass upon the issuance and sale of the Series [__] Debentures as herein contemplated and related proceedings, or in order to evidence the accuracy or completeness of any of the representations or warranties, or the fulfillment of any of the conditions herein contained, and all proceedings taken by the 17 Company in connection with the issuance and sale of the Series [__] Debentures and as herein contemplated shall be satisfactory in form and substance to the Representatives and Counsel for the Underwriters. In case any of the conditions specified above in this Section 6 shall not have been fulfilled, this Agreement may be terminated by the Representatives upon mailing or delivering written notice thereof to the Company. Any such termination shall be without liability of either party to the other party except as otherwise provided in Section 5(j) hereof and except for any liability under Section 8 hereof. 7. Conditions to Obligations of Company. The obligations of the Company hereunder are subject to the conditions set forth in Section 6(a) hereof exclusive of the first and last clauses thereof. In case such conditions shall not have been fulfilled, this Agreement may be terminated by the Company by mailing or delivering written notice thereof to the Representatives. Any such termination shall be without liability of either party to the other party except as otherwise provided in Section 5(j) hereof and except for any liability under Section 8 hereof. 8. Indemnification and Contribution. (a) Indemnification by Company. The Company agrees to indemnify and hold harmless each Underwriter and each person, if any, who controls any Underwriter within the meaning of Section 15 of the Act as follows: (i) against any and all loss, liability, claim, damage and expense whatsoever arising out of any untrue statement or alleged untrue statement of a material fact contained in a preliminary prospectus relating to the Series [__] Debentures, if any, including all documents then incorporated by reference therein pursuant to Item 12 of Form S-3, in the Incorporated Documents, in the Registration Statement or the Prospectus, or in the Registration Statement or the Prospectus as amended or supplemented (if any amendments or supplements thereto shall have been made), or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading unless such untrue statement or omission or such alleged untrue statement or omission was made in reliance upon and in conformity with written information furnished to the Company by any Underwriter, through the Representatives or otherwise, expressly for use in the Registration Statement or the Prospectus (or any amendment or supplement to either thereof) or arising out of, or based upon, statements in or omissions from that part of the Registration Statement that constitutes the Statement of Eligibility on Form T-1 under the Trust Indenture Act of the Trustee; provided, however, any such indemnity for a preliminary prospectus relating to the Series [__] Debentures, if any, or the Prospectus shall not inure to the benefit of any Underwriter (or of any person controlling such Underwriter) on account of any losses, claims, damages or liabilities arising from the sale of the Series [__] Debentures to any person if (i) such Underwriter shall have failed to send or give to such person (A) with or prior to the written confirmation of such sale, a copy of the Prospectus or the Prospectus as amended or supplemented, if any amendments or supplements thereto shall have been furnished to the Representatives at or prior to the 18 time of written confirmation of the sale involved, except any Incorporated Documents, or (B) with or prior to the delivery of the Series [__] Debentures to such person, a copy of any amendment or supplement to the Prospectus that shall have been furnished to the Representatives subsequent to such written confirmation and prior to the delivery of such Series [__] Debentures to such person, except any Incorporated Documents, and (ii) such untrue statement or omission or such alleged untrue statement or omission was corrected in the Prospectus or the Prospectus as amended or supplemented at the time of such delivery or confirmation, as the case may be; (ii) against any and all loss, liability, claim, damage and expense whatsoever to the extent of the aggregate amount paid in settlement of any litigation, commenced or threatened or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, if such settlement is effected with the written consent of the Company; and (iii) against any and all expense whatsoever reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid under clause (i) or (ii) above. (b) Indemnification of Company. Each Underwriter severally agrees to indemnify and hold harmless the Company, its directors, each of its officers who signed the Registration Statement, and any amendments or supplements thereto, and each person, if any, who controls the Company within the meaning of Section 15 of the Act against any and all loss, liability, claim, damage and expense described in the indemnity contained in Section 8(a) hereof, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration Statement (or any amendment thereto) or a preliminary prospectus relating to the Series [__] Debentures, if any, or the Prospectus (or any amendment or supplement thereto) in reliance upon and in conformity with written information furnished to the Company by such Underwriter, through the Representatives or otherwise, expressly for use in the Registration Statement (or any amendment or supplement thereto) or any such preliminary prospectus or the Prospectus (or any amendment or supplement thereto). (c) General. Each indemnified party shall give prompt notice to each indemnifying party of any action commenced against it in respect of which indemnity may be sought hereunder, but failure so to notify an indemnifying party shall not relieve it from any liability on account of this indemnity agreement except to the extent that it has been prejudiced in any material respect by such failure or from any liability that it may have otherwise than on account of this indemnity agreement. An indemnifying party may participate at its own expense in the defense of such action. If it so elects within a reasonable time after receipt of such notice, an indemnifying party, jointly with any other indemnifying parties receiving such notice, may assume the defense of such action with counsel chosen by it and approved by the indemnified parties defendant in such action, unless such indemnified parties reasonably object to such assumption on the ground that there may be legal defenses available to them that are different from or in addition to those available to such indemnifying party, in which case such indemnifying party cannot assume the control of the defense. Such firm shall be designated in 19 writing by, in the case of parties indemnified under Section 9(b) hereof, the Representatives and, in the case of parties indemnified under Section 9(a) hereof, the Company. If an indemnifying party assumes the defense of such action, the indemnifying parties shall not be liable for any fees and expenses of counsel for the indemnified parties incurred thereafter in connection with such action. Fees and expenses to be paid by the indemnifying parties shall be reimbursed as they are incurred. In no event shall the indemnifying parties be liable for the fees and expenses of more than one counsel, including any local counsel, for all indemnified parties in connection with any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances. No indemnifying party shall, without the prior written consent of each indemnified party, effect any settlement of any pending or threatened proceeding in respect of which such indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability claims that are the subject matter of such proceeding. (d) Contribution. If the indemnification provided for in this Section 8 is unavailable to or insufficient to hold harmless an indemnified party under Section 8(a) or 8(b) hereof in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other from the offering of the Series [__] Debentures. If, however, the allocation provided by the immediately preceding sentence is not permitted by applicable law, then such indemnifying party shall contribute to such amount paid or payable by such indemnified party in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Company on the one hand and the Underwriters on the other in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwriters on the other shall be deemed to be in the same proportion as the total net proceeds from the offering (before deducting expenses) received by the Company bear to the total underwriting discounts and commissions received by the Underwriters, in each case as set forth on the cover page of the Prospectus. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or the Underwriters and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and the Underwriters agree that it would not be just and equitable if contribution pursuant to this Section 8(d) were determined by pro rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to above in this Section 8(d). The amount paid or payable to an indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in this Section 8(d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. 20 (e) Confirmation of Certain Statements. The Underwriters confirm that the statements with respect to the public offering of the Series [__] Debentures set forth in the last paragraph on the cover page of, and the statements with respect to the resale of any Series [__] Debentures at a discount in the first paragraph under the list of Underwriters set forth under the caption "Underwriting" in, the Prospectus Supplement are correct and were furnished in writing to the Company by the Underwriters for inclusion in the Prospectus. 9. Termination. The Representatives may, by notice to the Company, terminate this Agreement at any time at or prior to the Closing Date, if (a) a banking moratorium shall have been declared either by federal authorities or authorities in the States of New York or Oregon, (b) trading in securities generally on the NYSE or of any securities of the Company shall have been suspended by the Commission, the NYSE or the Pacific Stock Exchange or there shall have been established by the Commission or the NYSE, any federal or state agency or the decision of any court any limitation on the prices for such trading or any restrictions on the distribution of such securities, (c) any outbreak or material escalation of hostilities or other calamity or crisis affecting the financial markets of the United States shall have occurred, (d) a downgrading shall have occurred in the ratings of any of the Debentures or any preferred stock or first mortgage or first mortgage and collateral trust bonds of the Company by any "nationally recognized statistical rating organization" (as defined for purposes of Rule 15c3-1 of the Regulations under the Exchange Act) or (e) any change in the business or properties of the Company shall have occurred, the effect of which is such as to make it impracticable to proceed with the sale or delivery of the Series [__] Debentures and, in the case of any of the events specified in clauses (a) through (d) of this Section 9, the effect of such event, singly or together with any other such events, is such as to make it, in the judgment of the Representatives, impracticable to proceed with the sale or delivery of the Series [__] Debentures. Any termination hereof pursuant to this Section 9 shall be without liability of any party to any other party except as otherwise provided in Section 5(j) hereof and except for any liability under Section 8 hereof. 10. Representations, Warranties and Agreements to Survive Delivery. All representations, warranties and agreements contained in this Agreement, or contained in certificates signed by officers of the Company, submitted pursuant hereto, shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of any Underwriter or any controlling person of any Underwriter, or by or on behalf of the Company, and shall survive delivery of the Series [__] Debentures to the Underwriters. 11. Miscellaneous. The validity and interpretation of this Agreement shall be governed by the laws of the State of New York. This Agreement shall inure to the benefit of the Company and the Underwriters and, with respect to the provisions of Section 8 hereof, each controlling person referred to in Section 8 hereof, and their respective successors, assigns, executors and administrators. Nothing in this Agreement is intended or shall be construed to give to any other person, firm or corporation any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained. The term "successors" as used in this Agreement shall not include any purchaser, as such purchaser, of any of the Series [__] Debentures from any of the Underwriters. This Agreement may be executed in any number of separate counterparts all of which together shall constitute the same Agreement. 21 12. Notices and Authority to Act. All communications hereunder shall be in writing (which may be telex or facsimile transmission) and effective only upon receipt and, if to the Underwriters, shall be sent to the Representatives at the address set forth above, Attention of [_____] and, if to the Company, shall be sent to it at PacifiCorp, 700 N.E. Multnomah, Suite 1600, Portland, Oregon 97232, Attention of Richard T. O'Brien, Vice President. 22 If the foregoing is in accordance with your understanding of our agreement, kindly sign and return to the Company the enclosed duplicate hereof, whereupon this letter will become a binding agreement between the Company and the several Underwriters in accordance with its terms. Very truly yours, PacifiCorp By _____________________________ Name: Title: Accepted as of the date first above written: Goldman, Sachs & Co. Smith Barney Inc. [insert names of other Representatives] By:_____________________________ (Goldman, Sachs & Co.) As representatives of the other several Underwriters named in Schedule I hereto SCHEDULE I Principal amount Underwriter Series [__] Debentures ----------- ---------------------- Goldman, Sachs & Co. Smith Barney Inc. Total =============== EX-4 4 EXHIBIT (4)(A) - ------------------------------------------------------------- PACIFICORP AND THE BANK OF NEW YORK AS TRUSTEE -------------------- INDENTURE DATED AS OF _______________, 1994 -------------------- JUNIOR SUBORDINATED DEBENTURES - ------------------------------------------------------------- i CROSS-REFERENCE TABLE Section of Trust Indenture Act Section of of 1939, as amended Indenture - ------------------- ------------- 310(a) . . . . . . . . . . . . . . . . . 7.09 310(b) . . . . . . . . . . . . . . . . . 7.08 7.10 310(c) . . . . . . . . . . . . . . . . . Inapplicable 311(a) . . . . . . . . . . . . . . . . . 7.13(a) 311(b) . . . . . . . . . . . . . . . . . 7.13(b) 311(c) . . . . . . . . . . . . . . . . . Inapplicable 312(a) . . . . . . . . . . . . . . . . . 5.01 5.02(a) 312(b) . . . . . . . . . . . . . . . . . 5.02(b) 312(c) . . . . . . . . . . . . . . . . . 5.02(c) 313(a) . . . . . . . . . . . . . . . . . 5.04(a) 313(b) . . . . . . . . . . . . . . . . . 5.04(b) 313(c) . . . . . . . . . . . . . . . . . 5.04(a) 5.04(b) 313(d) . . . . . . . . . . . . . . . . . 5.04(c) 314(a) . . . . . . . . . . . . . . . . . 5.03 314(b) . . . . . . . . . . . . . . . . . Inapplicable 314(c) . . . . . . . . . . . . . . . . . 13.06 314(d) . . . . . . . . . . . . . . . . . Inapplicable 314(e) . . . . . . . . . . . . . . . . . 13.06 314(f) . . . . . . . . . . . . . . . . . Inapplicable 315(a) . . . . . . . . . . . . . . . . . 7.01(a) 7.02 315(b) . . . . . . . . . . . . . . . . . 6.07 315(c) . . . . . . . . . . . . . . . . . 7.01 315(d) . . . . . . . . . . . . . . . . . 7.01(b) 7.01(c) 315(e) . . . . . . . . . . . . . . . . . 6.08 316(a) . . . . . . . . . . . . . . . . . 6.06 8.04 316(b) . . . . . . . . . . . . . . . . . 6.04 316(c) . . . . . . . . . . . . . . . . . 8.01 317(a) . . . . . . . . . . . . . . . . . 6.02 317(b) . . . . . . . . . . . . . . . . . 4.04 318(a) . . . . . . . . . . . . . . . . . 13.08 ii TABLE OF CONTENTS ----------------- Page ---- PARTIES. . . . . . . . . . . . . . . . . . . . . . . . . . . .1 RECITALS: Purpose of Indenture . . . . . . . . . . . . . . . . . . . . .1 Compliance with legal requirements . . . . . . . . . . . . . .1 Purpose of and consideration for Indenture . . . . . . . . . .1 ARTICLE ONE DEFINITIONS SECTION 1.01 Certain terms defined; other terms defined in the Trust Indenture Act of 1939, as amended, or by reference therein in the Securities Act of 1933, as amended, to have the meanings assigned therein . . . . . . . . .1 Authenticating Agent. . . . . . . . . . . . . .1 Board of Directors. . . . . . . . . . . . . . .2 Board Resolution. . . . . . . . . . . . . . . .2 Business day. . . . . . . . . . . . . . . . . .2 Certificate . . . . . . . . . . . . . . . . . .2 Corporate Trust Office. . . . . . . . . . . . .2 Company . . . . . . . . . . . . . . . . . . . .2 Debenture or Debentures . . . . . . . . . . . .2 Debentureholder . . . . . . . . . . . . . . . .2 Default . . . . . . . . . . . . . . . . . . . .2 Depository. . . . . . . . . . . . . . . . . . .2 Event of Default. . . . . . . . . . . . . . . .3 Global Debenture. . . . . . . . . . . . . . . .3 Governmental Obligations. . . . . . . . . . . .3 Indenture . . . . . . . . . . . . . . . . . . .3 Interest Payment Date . . . . . . . . . . . . .3 Officers' Certificate . . . . . . . . . . . . .3 Opinion of Counsel. . . . . . . . . . . . . . .3 Outstanding . . . . . . . . . . . . . . . . . .4 Predecessor Debenture . . . . . . . . . . . . .4 Responsible Officer . . . . . . . . . . . . . .4 Senior Indebtedness . . . . . . . . . . . . . .4 Trustee . . . . . . . . . . . . . . . . . . . .4 Trust Indenture Act . . . . . . . . . . . . . .5 ARTICLE TWO ISSUE, DESCRIPTION, TERMS, EXECUTION, REGISTRATION AND EXCHANGE OF DEBENTURES SECTION 2.01 Designation, terms, amount, authentication and delivery of Debentures. . . . . . . . . . .5 SECTION 2.02 Form of Debentures and Trustee's certificate. .6 _______________ * This Table of Contents does not constitute part of the Indenture and should not have any bearing upon the interpretation of any of its terms or provisions. iii Page ---- SECTION 2.03 Date and denominations of Debentures, and provisions for payment of principal, premium and interest. . . . . . . . . . . . . . . . . .6 SECTION 2.04 Execution of Debentures . . . . . . . . . . . .7 SECTION 2.05 Exchange of Debentures. . . . . . . . . . . . .8 (a) Registration and transfer of Debentures. .8 (b) Debentures to be accompanied by proper instruments of transfer. . . . . . . . . .8 (c) Charges upon exchange, transfer or registration of Debentures . . . . . . . .9 (d) Restrictions on transfer or exchange at time of redemption. . . . . . . . . . .9 SECTION 2.06 Temporary Debentures. . . . . . . . . . . . . .9 SECTION 2.07 Mutilated, destroyed, lost or stolen Debentures. . . . . . . . . . . . . . . . . . .9 SECTION 2.08 Cancellation of surrendered Debentures. . . . 10 SECTION 2.09 Provisions of Indenture and Debentures for sole benefit of parties and Debentureholders. . . . . . . . . . . . . . . 10 SECTION 2.10 Appointment of Authenticating Agent . . . . . 10 SECTION 2.11 Global Debenture. . . . . . . . . . . . . . . 10 ARTICLE THREE REDEMPTION OF DEBENTURES AND SINKING FUND PROVISIONS SECTION 3.01 Redemption of Debentures. . . . . . . . . . . 11 SECTION 3.02 (a) Notice of redemption . . . . . . . . . . 11 (b) Selection of Debentures in case less than all Debentures to be redeemed . . . 12 SECTION 3.03 (a) When Debentures called for redemption become due and payable . . . . . . . . . 12 (b) Receipt of new Debenture upon partial payment. . . . . . . . . . . . . . . . . 12 SECTION 3.04 Sinking Fund for Debentures . . . . . . . . . 12 SECTION 3.05 Satisfaction of Sinking Fund Payments with Debentures . . . . . . . . . . . . . . . 13 SECTION 3.06 Redemption of Debentures for Sinking Fund . . 13 ARTICLE FOUR PARTICULAR COVENANTS OF THE COMPANY SECTION 4.01 Payment of principal of (and premium, if any) and interest on Debentures. . . . . . . . . . 13 iv Page ---- SECTION 4.02 Maintenance of office or agency for payment of Debentures, designation of office or agency for payment, registration, transfer and exchange of Debentures. . . . . . . . . . 13 SECTION 4.03 (a) Duties of paying agent . . . . . . . . . 13 (b) Company as paying agent. . . . . . . . . 14 (c) Holding sums in trust. . . . . . . . . . 14 SECTION 4.04 Appointment to fill vacancy in office of Trustee . . . . . . . . . . . . . . . . . . . 14 SECTION 4.05 Restriction on consolidation, merger or sale . . . . . . . . . . . . . . . . . . . 14 SECTION 4.06 Restriction on declaration of dividends, etc. . . . . . . . . . . . . . . . 14 ARTICLE FIVE DEBENTUREHOLDERS' LISTS, AND REPORTS BY THE COMPANY AND THE TRUSTEE SECTION 5.01 Company to furnish Trustee information as to names and addresses of Debentureholders . . . 15 SECTION 5.02 (a) Trustee to preserve information as to names and addresses of Debentureholders received by it in capacity of paying agent . . . . . . . . . . . . . . 15 (b) Trustee may destroy list of Debentureholders on certain conditions . . . . . . . . . . . . . . . 15 (c) Trustee to make information as to names and addresses of Debentureholders available to "applicants" or mail communications to Debentureholders in certain circumstances. . . . . . . . . . 15 (d) Procedure if Trustee elects not to make information available to applicants. . . . . . . . . . . . . . 15 (e) Company and Trustee not accountable for disclosure of information. . . . . . 16 SECTION 5.03 (a) Annual and other reports to be filed by Company with Trustee. . . . . . . . . 16 (b) Additional information and reports to be filed with Trustee and Securities and Exchange Commission. . . . . . . . . 16 (c) Summaries of information and reports to be transmitted by Company to Debentureholders . . . . . . . . . . . . 16 (d) Annual Certificate to be furnished to Trustee . . . . . . . . . . . . . . . 16 (e) Reports concerning original issue discount . . . . . . . . . . . . . 16 SECTION 5.04 (a) Trustee to transmit annual report to Debentureholders . . . . . . . . . . . . 16 (b) Trustee to transmit certain further reports to Debentureholders. . . . . . . 17 v Page ---- (c) Copies of reports to be filed with stock exchanges and Securities and Exchange Commission. . . . . . . . . 17 ARTICLE SIX REMEDIES OF THE TRUSTEE AND DEBENTUREHOLDERS UPON EVENT OF DEFAULT SECTION 6.01 (a) Events of Default defined. . . . . . . . 18 (b) Acceleration of maturity upon Event of Default. . . . . . . . . . . . . . . . . 18 (c) Waiver of default and rescission of declaration of maturity. . . . . . . . . 19 (d) Restoration of former position and rights upon curing default . . . . . . . 19 SECTION 6.02 (a) Covenant of Company to pay to Trustee whole amount due on Debentures on default in payment of interest or principal (and premium, if any). . . . . 19 (b) Trustee may recover judgment for whole amount due on Debentures on failure of Company to pay . . . . . . . . . . . . . 19 (c) Filing of proof of claim by Trustee in bankruptcy, reorganization or receivership proceeding. . . . . . . . . 19 (d) Rights of action and of asserting claims may be enforced by Trustee without possession of Debentures . . . . . . . . 20 SECTION 6.03 Application of moneys collected by Trustee. . 20 SECTION 6.04 Limitation on suits by holders of Debentures. 20 SECTION 6.05 (a) Remedies cumulative. . . . . . . . . . . 21 (b) Delay or omission in exercise of rights not waiver of default . . . . . . 21 SECTION 6.06 Rights of holders of majority in principal amount of Debentures to direct Trustee and to waive defaults . . . . . . . . . . . . . . 21 SECTION 6.07 Trustee to give notice of defaults known to it, but may withhold in certain circumstances . . . . . . . . . . . . . . . . 21 SECTION 6.08 Requirements of an undertaking to pay costs in certain suits under Indenture or against Trustee . . . . . . . . . . . . . . . 22 ARTICLE SEVEN CONCERNING THE TRUSTEE SECTION 7.01 (a) Upon Event of Default occurring and continuing, Trustee shall exercise powers vested in it, and use same degree of care and skill in their exercise, as prudent individual would use. . . . . . . . . . . . . . . . 22 (b) Trustee not relieved from liability for negligence or willful misconduct except as provided in this section . . . 22 vi Page ---- (1) Prior to Event of Default and after the curing of all Events of Default which may have occurred. . . . . 22 (i) Trustee not liable except for performance of duties specifically set forth. . . . . . . . . . . . . . . . 22 (ii) In absence of bad faith, Trustee may conclusively rely on certificates or opinions furnished it hereunder, subject to duty to examine the same if specifically required to be furnished to it. . . . . . . . . . . . . 23 (2) Trustee not liable for error of judgment made in good faith by Responsible Officer unless Trustee negligent. . . . . . . . . . . . . . . . 23 (3) Trustee not liable for action or non-action in accordance with direction of holders of majority in principal amount of Debentures . . . . . . . . . . 23 (4) Trustee need not expend own funds without adequate indemnity . . . . . . . 23 (c) Provisions regarding liability of Trustee subject to Section 7.01. . . . . 23 SECTION 7.02 Subject to provisions of Section 7.01: (a) Trustee may rely on documents believed genuine and properly signed or presented. . . . . . . . . . . . . . . . 23 (b) Sufficient evidence by certain instruments provided for . . . . . . . . 23 (c) Trustee may obtain Officer's Certificate. . . . . . . . . . . . . . . 23 (d) Trustee may consult with counsel and act on advice or Opinion of Counsel. . . . . 23 (e) Trustee may require indemnity from Debentureholders . . . . . . . . . . . . 24 (f) Prior to Event of Default Trustee not bound to investigate facts or matters stated in certificates, etc., unless requested in writing by Debentureholders . . . . . . . . . . . . 24 (g) Trustee not liable for actions in good faith believed to be authorized . . 24 (h) Trustee not bound to make investigation. 24 (i) Trustee may perform duties directly or through agents or attorneys. . . . . . . 24 (j) Application for Instructions . . . . . . 24 SECTION 7.03 (a) Trustee not liable for recitals in Indenture or in Debentures . . . . . . . 24 (b) No representations by Trustee as to validity of Indenture or of Debentures . . . . . . . . . . . . . . . 24 (c) Trustee not accountable for use of Debentures or proceeds . . . . . . . . . 24 vii Page ---- SECTION 7.04 Trustee, paying agent or Debenture Registrar may own Debentures. . . . . . . . . . . . . . 25 SECTION 7.05 Moneys received by Trustee to be held in trust without interest. . . . . . . . . . . . 25 SECTION 7.06 (a) Trustee entitled to compensation, reimbursement and indemnity. . . . . . . 25 (b) Obligations to Trustee to be secured by claim prior to Debentures . . . . . . 25 (c) Services in connection with Event of Default. . . . . . . . . . . . . . . . . 25 SECTION 7.07 Right of Trustee to rely on certificate of officers of Company where no other evidence specifically prescribed. . . . . . . 25 SECTION 7.08 Trustee acquiring conflicting interest to eliminate conflict or resign. . . . . . . . . 25 SECTION 7.09 Requirements for eligibility of Trustee . . . 25 SECTION 7.10 (a) Resignation of Trustee and appointment of successor . . . . . . . . . . . . . . 26 (b) Removal of Trustee by Company or by court on Debentureholders' application. . . . . . . . . . . . . . . 26 (c) Removal of Trustee by holders of majority in principal amount of Debentures. . . . . . . . . . . . . . 26 (d) Time when resignation or removal of Trustee effective . . . . . . . . . . 27 (e) One Trustee for each series. . . . . . . 27 SECTION 7.11 (a) Acceptance by successor to Trustee . . . 27 (b) Trustee with respect to less than all series . . . . . . . . . . . . . . . 27 (c) Company to confirm Trustee's rights. . . 27 (d) Successor Trustee to be qualified. . . . 27 (e) Notice of succession . . . . . . . . . . 28 SECTION 7.12 Successor to Trustee by merger, consolidation or succession to business . . . . . . . . . . 28 SECTION 7.13 Limitations on rights of Trustee as a creditor to obtain payment of certain claims within four months prior to default or during default, or to realize on property as such creditor thereafter . . . . . . . . . . . . . 28 ARTICLE EIGHT CONCERNING THE DEBENTUREHOLDERS SECTION 8.01 Evidence of action by Debentureholders. . . . 28 SECTION 8.02 Proof of execution of instruments and of holding of Debentures . . . . . . . . . . . . 28 SECTION 8.03 Who may be deemed owners of Debentures. . . . 29 vii Page ---- SECTION 8.04 Debentures owned by Company or controlled or controlling companies disregarded for certain purposes. . . . . . . . . . . . . . . 29 SECTION 8.05 Instruments executed by Debentureholders bind future holders . . . . . . . . . . . . . 29 ARTICLE NINE SUPPLEMENTAL INDENTURES SECTION 9.01 Purposes for which supplemental indenture may be entered into without consent of Debentureholders. . . . . . . . . . . . . . . 29 SECTION 9.02 Modification of Indenture with consent of Debentureholders. . . . . . . . . . . . . . . 30 SECTION 9.03 Effect of supplemental indentures . . . . . . 31 SECTION 9.04 Debentures may bear notation of changes by supplemental indentures . . . . . . . . . . . 31 SECTION 9.05 Opinion of Counsel. . . . . . . . . . . . . . 31 ARTICLE TEN CONSOLIDATION, MERGER AND SALE SECTION 10.01 Consolidations or mergers of Company and sales or conveyances of property of Company permitted . . . . . . . . . . . . . . . . . . 31 SECTION 10.02 (a) Rights and duties of successor company . 32 (b) Appropriate changes may be made in phraseology and form of Debentures . . . 32 (c) Company may consolidate or merge into itself or acquire properties of other corporations . . . . . . . . . . . . . . 32 SECTION 10.03 Opinion of Counsel. . . . . . . . . . . . . . 32 ARTICLE ELEVEN SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS SECTION 11.01 Satisfaction and discharge of Indenture . . . 32 SECTION 11.02 Discharge of Company's Obligations. . . . . . 33 SECTION 11.03 Opinion of Counsel. . . . . . . . . . . . . . 33 SECTION 11.04 Application by Trustee of funds deposited for payment of Debentures . . . . . . . . . . 33 SECTION 11.05 Repayment of moneys held by paying agent. . . 34 SECTION 11.06 Repayment of moneys held by Trustee . . . . . 34 ix Page ---- ARTICLE TWELVE IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS SECTION 12.01 Incorporators, stockholders, officers and directors of Company exempt from individual liability . . . . . . . . . . . . . . . . . . 34 ARTICLE THIRTEEN MISCELLANEOUS PROVISIONS SECTION 13.01 Successors and assigns of Company bound by Indenture . . . . . . . . . . . . . . . . . . 34 SECTION 13.02 Acts of board, committee or officer of successor company valid . . . . . . . . . . . 34 SECTION 13.03 Required notices or demands may be served by mail . . . . . . . . . . . . . . . . . . . 34 SECTION 13.04 Indenture and Debentures to be construed in accordance with laws of the State of New York. . . . . . . . . . . . . . . . . . . 35 SECTION 13.05 (a) Officers' Certificate and Opinion of Counsel to be furnished upon applications or demands by Company . . . 35 (b) Statements to be included in each certificate or opinion with respect to compliance with condition or covenant. . 35 SECTION 13.06 Opinion of Counsel to be furnished upon execution of Indenture. . . . . . . . . . . . 35 SECTION 13.07 Payments due on Sundays or holidays . . . . . 35 SECTION 13.08 Provisions required by Trust Indenture Act of 1939 to control. . . . . . . . . . . . . . 35 SECTION 13.09 Indenture may be executed in counterparts . . 35 SECTION 13.10 Separability of Indenture provisions. . . . . 35 SECTION 13.11 Assignment by Company to subsidiary . . . . . 36 ARTICLE FOURTEEN SUBORDINATION OF DEBENTURES SECTION 14.01 Agreement of Subordination. . . . . . . . . . 36 SECTION 14.02 Limitations on payments to Debentureholders . 36 SECTION 14.03 Payments in bankruptcy. . . . . . . . . . . . 36 SECTION 14.04 Subrogation of Debentures . . . . . . . . . . 37 SECTION 14.05 Authorization by Debentureholders . . . . . . 38 SECTION 14.06 Notice to Trustee . . . . . . . . . . . . . . 38 SECTION 14.07 Trustee's relation to Senior Indebtedness . . 39 x Page ---- SECTION 14.08 Acts of holders of Senior Indebtedness. . . . 39 ACCEPTANCE OF TRUST BY TRUSTEE . . . . . . . . . . . . . . . 40 TESTIMONIUM. . . . . . . . . . . . . . . . . . . . . . . . .39 SIGNATURES AND SEALS . . . . . . . . . . . . . . . . . . . .40 ACKNOWLEDGEMENTS . . . . . . . . . . . . . . . . . . . . . .40 1 THIS INDENTURE, dated as of the _____ day of ____________, 1994, between PACIFICORP, a corporation duly organized and existing under the laws of the state of Oregon (hereinafter sometimes referred to as the "Company"), and THE BANK OF NEW YORK, a New York banking corporation organized and existing under the laws of the State of New York, as trustee (hereinafter sometimes referred to as the "Trustee"): WHEREAS, for its lawful corporate purposes, the Company has duly authorized the execution and delivery of this Indenture to provide for the issuance of debentures (hereinafter referred to as the "Debentures"), in an unlimited aggregate principal amount to be issued from time to time in one or more series as in this Indenture provided as registered Debentures without coupons, to be authenticated by the certificate of the Trustee; WHEREAS, to provide the terms and conditions upon which the Debentures are to be authenticated, issued and delivered, the Company has duly authorized the execution of this Indenture; WHEREAS, the Debentures and the certificate of authentication to be borne by the Debentures (the "Certificate of Authentication") are to be substantially in such forms as may be approved by the Board of Directors (as defined below) or set forth in any indenture supplemental to this Indenture; and WHEREAS, all acts and things necessary to make the Debentures issued pursuant hereto, when executed by the Company and authenticated and delivered by the Trustee as in this Indenture provided, the valid, binding and legal obligations of the Company, and to constitute these presents a valid indenture and agreement according to its terms, have been done and performed or will be done and performed prior to the issuance of such Debentures, and the execution of this Indenture and the issuance hereunder of the Debentures have been or will be prior to issuance in all respects duly authorized, and the Company, in the exercise of the legal right and power in it vested, executes this Indenture and proposes to make, execute, issue and deliver the Debentures; NOW, THEREFORE, THIS INDENTURE WITNESSETH: That in order to declare the terms and conditions upon which the Debentures are and are to be authenticated, issued and delivered, and in consideration of the premises, of the purchase and acceptance of the Debentures by the holders thereof and of the sum of one dollar ($1.00) to it duly paid by the Trustee at the execution of these presents, the receipt whereof is hereby acknowledged, the Company covenants and agrees with the Trustee, for the equal and proportionate benefit (subject to the provisions of this Indenture) of the respective holders from time to time of the Debentures, without any discrimination, preference or priority of any one Debenture over any other by reason of priority in the time of issue, sale or negotiation thereof, or otherwise, except as provided herein, as follows: ARTICLE ONE Definitions SECTION 1.01. The terms defined in this Section (except as in this Indenture otherwise expressly provided or unless the context otherwise requires) for all purposes of this Indenture, any resolution of the Board of Directors of the Company and of any indenture supplemental hereto shall have the respective meanings specified in this Section. All other terms used in this Indenture which are defined in the Trust Indenture Act of 1939, as amended, or which are by reference in such Act defined in the Securities Act of 1933, as amended (except as herein otherwise expressly provided or unless the context otherwise requires), shall have the meanings assigned to such terms in said Trust Indenture Act and in said Securities Act as in force at the date of the execution of this instrument. Authenticating Agent: The term "Authenticating Agent" means an authenticating agent with respect to all or any of the series of Debentures, as the case may be, appointed with respect to all or any series of the Debentures, as the case may be, by the Trustee pursuant to section 2.10. 2 Board of Directors: The term "Board of Directors" shall mean the Board of Directors of the Company, or any committee of such Board duly authorized to act on behalf thereof hereunder. Board Resolution: The term "Board Resolution" shall mean a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company to have been duly adopted by the Board of Directors and to be in full force and effect on the date of such certification. Business day: The term "business day", with respect to any series of Debentures, shall mean any day other than a day on which banking institutions in the Borough of Manhattan, the City and State of New York, are authorized to close. Certificate: The term "Certificate" shall mean a certificate signed by the principal executive officer, the principal financial officer or the principal accounting officer of the Company. The Certificate need not comply with the provisions of Section 13.05. Corporate Trust Office: The term "Corporate Trust Office" shall mean the office of the Trustee at which at any particular time its corporate trust business shall be principally administered, which office at the date of the execution of this Indenture is located at 101 Barclay Street, New York, NY 10286, Attention: Corporate Trust Trustee Administration. Company: The term "Company" shall mean PacifiCorp, a corporation duly organized and existing under the laws of the State of Oregon, and, subject to the provisions of Article Ten, shall also include its successors and assigns. Debenture or Debentures: The term "Debenture" or "Debentures" shall mean any Debenture or Debentures, as the case may be, authenticated and delivered under this Indenture. Debentureholder: The term "Debentureholder", "holder of Debentures", "registered holder", or other similar term, shall mean the person or persons in whose name or names a particular Debenture shall be registered on the books of the Company kept for that purpose in accordance with the terms of this Indenture. Default: The term "default" shall mean any event, act or condition which with notice or lapse of time, or both, would constitute an Event of Default. Depository: The term "Depository" shall mean, with respect to Debentures of any series, for which the Company shall determine that such Debentures will be issued as a Global Debenture, The Depository Trust Company, New York, New York, another clearing agency, or any successor registered as a clearing 3 agency under the Securities and Exchange Act of 1934, as amended (the "Exchange Act"), or other applicable statute or regulation, which, in each case, shall be designated by the Company pursuant to either Section 2.01 or 2.11. Event of Default: The term "Event of Default" with respect to Debentures of a particular series shall mean any event specified in Section 6.01, continued for the period of time, if any, therein designated. Global Debenture: The term "Global Debenture" shall mean, with respect to any series of Debentures, a Debenture executed by the Company and delivered by the Trustee to the Depository or pursuant to the Depository's instruction, all in accordance with the Indenture, which shall be registered in the name of the Depository or its nominee. Governmental Obligations: The term "Governmental Obligations" shall mean securities that are (i) direct obligations of the United States of America for the payment of which its full faith and credit is pledged or (ii) obligations of a person controlled or supervised by and acting as an agency or instrumentality of the United States of America, the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, which, in either case, are not callable or redeemable at the option of the issuer thereof, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act of 1933, as amended) as custodian with respect to any such Governmental Obligation or a specific payment of principal of or interest on any such Governmental Obligation held by such custodian for the account of the holder of such depository receipt; provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the specific payment of principal of or interest on the Governmental Obligation evidenced by such depository receipt. Indenture: The term "Indenture" shall mean this instrument as originally executed, or, if amended or supplemented as herein provided, as so amended or supplemented. Interest Payment Date: The term "Interest Payment Date" when used with respect to any installment of interest on a Debenture of a particular series shall mean the date specified in such Debenture or in a Board Resolution or in an indenture supplemental hereto with respect to such series as the fixed date on which an installment of interest with respect to Debentures of that series is due and payable. Officers' Certificate: The term "Officers' Certificate" shall mean a certificate signed by the President or a Vice President and by the Treasurer or an Assistant Treasurer or the Controller or an Assistant Controller or the Secretary or an Assistant Secretary of the Company. Each such certificate shall include the statements provided for in Section 13.05, if and to the extent required by the provisions thereof. Opinion of Counsel: The term "Opinion of Counsel" shall mean an opinion in writing signed by legal counsel, who may be counsel for the Company, reasonably acceptable to the Trustee. Each such opinion shall include the statements provided for in Section 13.05, if and to the extent required by the provisions thereof. 4 Outstanding: The term "outstanding", when used with reference to Debentures of any series, shall, subject to the provisions of Section 8.04, mean, as of any particular time, all Debentures of that series theretofore authenticated and delivered by the Trustee under this Indenture, except (a) Debentures theretofore canceled by the Trustee or any paying agent, or delivered to the Trustee or any paying agent for cancellation or which have previously been canceled; (b) Debentures or portions thereof for the payment or redemption of which moneys or Governmental Obligations in the necessary amount shall have been deposited in trust with the Trustee or with any paying agent (other than the Company) or shall have been set aside and segregated in trust by the Company (if the Company shall act as its own paying agent); provided, however, that if such Debentures or portions of such Debentures are to be redeemed prior to the maturity thereof, notice of such redemption shall have been given as in Article Three provided, or provision satisfactory to the Trustee shall have been made for giving such notice; (c) Debentures in lieu of or in substitution for which other Debentures shall have been authenticated and delivered pursuant to the terms of Section 2.07; and (d) Debentures paid pursuant to Section 2.07. Predecessor Debenture: The term "Predecessor Debenture" of any particular Debenture shall mean every previous Debenture evidencing all or a portion of the same debt as that evidenced by such particular Debenture; and, for the purposes of this definition, any Debenture authenticated and delivered under Section 2.07 in lieu of a lost, destroyed or stolen Debenture shall be deemed to evidence the same debt as the lost, destroyed or stolen Debenture. Responsible Officer: The term "Responsible Officer" when used with respect to the Trustee shall mean the chairman of the board of directors, the president, any vice president, the secretary, the treasurer, any trust officer, any corporate trust officer or any other officer or assistant officer of the Trustee customarily performing functions similar to those performed by the persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of his or her knowledge of and familiarity with the particular subject. Senior Indebtedness: The term "Senior Indebtedness" of the Company shall mean the principal of and premium, if any, and interest on and any other payment due pursuant to any of the following, whether outstanding at the date of execution of this Indenture or thereafter incurred, created or assumed: (a) all indebtedness of the Company evidenced by notes, debentures, bonds or other securities sold by the Company for money, (b) all indebtedness of others of the kinds described in the preceding clause (a) assumed by or guaranteed in any manner by the Company or in effect guaranteed by the Company through an agreement to purchase, contingent or otherwise, and (c) all renewals, extensions or refundings of indebtedness of the kinds described in either of the preceding clauses (a) and (b) unless, in the case of any particular indebtedness, renewal, extension or refunding, the instrument creating or evidencing the same or the assumption or guarantee of the same expressly provides that such indebtedness, renewal, extension or refunding is not superior in right of payment to or is pari passu with the Debentures. Trustee: The term "Trustee" shall mean The Bank of New York and, subject to the provisions of Article Seven, shall also include its successors and assigns, and, if at any time there is more than one person acting in such capacity hereunder, "Trustee" shall mean each such person. The term "Trustee" as used with respect to a particular series of the Debentures shall mean the trustee with respect to that series. 5 Trust Indenture Act: The term "Trust Indenture Act", subject to the provisions of Sections 9.01, 9.02, and 10.01, shall mean the Trust Indenture Act of 1939, as amended and in effect at the date of execution of this Indenture. ARTICLE TWO Issue, Description, Terms, Execution, Registration and Exchange of Debentures SECTION 2.01. The aggregate principal amount of Debentures which may be authenticated and delivered under this Indenture is unlimited. The Debentures may be issued in one or more series up to the aggregate principal amount of Debentures of that series from time to time authorized by or pursuant to a Board Resolution or pursuant to one or more indentures supplemental hereto, prior to the initial issuance of Debentures of a particular series. Prior to the initial issuance of Debentures of any series, there shall be established in or pursuant to a Board Resolution delivered to the Trustee, and set forth in an Officers' Certificate delivered to the Trustee, or established in one or more indentures supplemental hereto: (1) the title of the Debentures of the series (which shall distinguish the Debentures of such series from all other Debentures); (2) any limit upon the aggregate principal amount of the Debentures of that series which may be authenticated and delivered under this Indenture (except for Debentures authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Debentures of such series); (3) the date or dates on which the principal of the Debentures of such series is payable; (4) the rate or rates at which the Debentures of such series shall bear interest or the manner of calculation of such rate or rates, if any; (5) the date or dates from which such interest shall accrue, the Interest Payment Dates on which such interest will be payable or the manner of determination of such Interest Payment Dates and the record date for the determination of holders to whom interest is payable on any such Interest Payment Dates; (6) the right, if any, to extend the interest payment periods and the duration of such extension; (7) the period or periods within which, the price or prices at which and the terms and conditions upon which, Debentures of such series may be redeemed, in whole or in part, at the option of the Company; (8) the obligation, if any, of the Company to redeem or purchase Debentures of such series pursuant to any sinking fund or analogous provisions (including payments made in cash in anticipation of future sinking fund obligations) or at the option of a holder thereof and the period or periods within which, the price or prices at which, and the terms and conditions upon which, Debentures of such series shall be redeemed or purchased, in whole or in part, pursuant to such obligation; (9) the form of the Debentures of such series including the form of the Certificate of Authentication for such series; (10) if other than denominations of $25 or any integral multiple thereof, the denominations in which such Debentures of the series shall be issuable; 6 (11) any and all other terms with respect to such series (which terms shall not be inconsistent with the terms of this Indenture); and (12) whether the Debentures are issuable as a Global Debenture and, in such case, the identity of the Depository for such series. All Debentures of any one series shall be substantially identical except as to denomination and except as may otherwise be provided in or pursuant to any such Board Resolution or in any indentures supplemental hereto. If any of the terms of such series are established by action taken pursuant to a Board Resolution, a copy of an appropriate record of such action shall be certified by the Secretary or an Assistant Secretary of the Company and delivered to the Trustee at or prior to the delivery of the Officers' Certificate setting forth the terms of such series. SECTION 2.02. The Debentures of any series and the Certificate of Authentication to be borne by such Debentures shall be substantially of the tenor and purport as set forth in one or more indentures supplemental hereto or as provided in a Board Resolution and as set forth in an Officers' Certificate, and may have such letters, numbers or other marks of identification or designation and such legends or endorsements printed, lithographed or engraved thereon as the Company may deem appropriate and as are not inconsistent with the provisions of this Indenture, or as may be required to comply with any law or with any rule or regulation made pursuant thereto or with any rule or regulation of any stock exchange on which Debentures of that series may be listed, or to conform to usage. SECTION 2.03. The Debentures shall be issuable as registered Debentures and in denominations of $25 or any integral multiple thereof, subject to Section 2.01(10). The Debentures of a particular series shall bear interest payable on the dates and at the rate or rates specified with respect to that series. The principal of and the interest on the Debentures of any series, as well as any premium thereon in case of redemption thereof prior to maturity, shall be payable in the coin or currency of the United States of America which at the time is legal tender for public and private debt, at the office or agency of the Company maintained for that purpose in the Borough of Manhattan, the City and State of New York. Each Debenture shall be dated the date of its authentication. Interest on the Debentures shall be computed on the basis of a 360-day year composed of twelve 30-day months. The interest installment on any Debenture which is payable, and is punctually paid or duly provided for, on any Interest Payment Date for Debentures of that series shall be paid to the person in whose name said Debenture (or one or more Predecessor Debentures) is registered at the close of business on the regular record date for such interest installment. In the event that any Debenture of a particular series or portion thereof is called for redemption and the redemption date is subsequent to a regular record date with respect to any Interest Payment Date and prior to such Interest Payment Date, interest on such Debenture will be paid upon presentation and surrender of such Debenture as provided in Section 3.03. Any interest on any Debenture which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date for Debentures of the same series (herein called "Defaulted Interest") shall forthwith cease to be payable to the registered holder on the relevant regular record date by virtue of having been such holder; and such Defaulted Interest shall be paid by the Company, at its election, as provided in clause (1) or clause (2) below: (1) The Company may make payment of any Defaulted Interest on Debentures to the persons in whose names such Debentures (or their respective Predecessor Debentures) are registered at the close of business on a special record date for the payment of such Defaulted Interest, which shall be fixed in the following manner: the Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each such Debenture and the date of the proposed payment, and at the same time the Company shall 7 deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the persons entitled to such Defaulted Interest as in this clause provided. Thereupon the Trustee shall fix a special record date for the payment of such Defaulted Interest which shall not be more than 15 nor less than 10 days prior to the date of the proposed payment and not less than 10 days after the receipt by the Trustee of the notice of the proposed payment. The Trustee shall promptly notify the Company of such special record date and, in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the special record date therefor to be mailed, first class postage prepaid, to each Debentureholder at his or her address as it appears in the Debenture Register (as hereinafter defined), not less than 10 days prior to such special record date. Notice of the proposed payment of such Defaulted Interest and the special record date therefor having been mailed as aforesaid, such Defaulted Interest shall be paid to the persons in whose names such Debentures (or their respective Predecessor Debentures) are registered on such special record date and shall be no longer payable pursuant to the following clause (2). (2) The Company may make payment of any Defaulted Interest on any Debentures in any other lawful manner not inconsistent with the requirements of any securities exchange on which such Debentures may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee. Unless otherwise set forth in a Board Resolution or one or more indentures supplemental hereto establishing the terms of any series of Debentures pursuant to Section 2.01 hereof, the term "regular record date" as used in this Section with respect to a series of Debentures with respect to any Interest Payment Date for such series shall mean either the fifteenth day of the month immediately preceding the month in which an Interest Payment Date established for such series pursuant to Section 2.01 hereof shall occur, if such Interest Payment Date is the first day of a month, or the last day of the month immediately preceding the month in which an Interest Payment Date established for such series pursuant to Section 2.01 hereof shall occur, if such Interest Payment Date is the fifteenth day of a month, whether or not such date is a business day. Subject to the foregoing provisions of this Section, each Debenture of a series delivered under this Indenture upon transfer of or in exchange for or in lieu of any other Debenture of such series shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Debenture. SECTION 2.04. The Debentures shall, subject to the provisions of Section 2.06, be printed on steel engraved borders or fully or partially engraved, or legibly typed, as the proper officers of the Company may determine, and shall be signed on behalf of the Company by its President or one of its Vice Presidents, under its corporate seal attested by its Secretary or one of its Assistant Secretaries. The signature of the President or a Vice President and/or the signature of the Secretary or an Assistant Secretary in attestation of the corporate seal, upon the Debentures, may be in the form of a facsimile signature of a present or any future President or Vice President and of a present or any future Secretary or Assistant Secretary and may be imprinted or otherwise reproduced on the Debentures and for that purpose the Company may use the facsimile signature of any person who shall have been a President or Vice President, or of any person who shall have been a Secretary or Assistant Secretary, notwithstanding the fact that at the time the Debentures shall be authenticated and delivered or disposed of such person shall have ceased to be the President or a Vice President, or the Secretary or an Assistant Secretary, of the Company, as the case may be. The seal of the Company may be in the form of a facsimile of the seal of the Company and may be impressed, affixed, imprinted or otherwise reproduced on the Debentures. Only such Debentures as shall bear thereon a Certificate of Authentication substantially in the form established for such Debentures, executed manually by an authorized signatory of the 8 Trustee, or by any Authenticating Agent with respect to such Debentures, shall be entitled to the benefits of this Indenture or be valid or obligatory for any purpose. Such certificate executed by the Trustee, or by any Authenticating Agent appointed by the Trustee with respect to such Debentures, upon any Debenture executed by the Company shall be conclusive evidence that the Debenture so authenticated has been duly authenticated and delivered hereunder and that the holder is entitled to the benefits of this Indenture. At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Debentures of any series executed by the Company to the Trustee for authentication, together with a written order of the Company for the authentication and delivery of such Debentures, signed by its President or any Vice President and its Treasurer or any Assistant Treasurer, and the Trustee in accordance with such written order shall authenticate and deliver such Debentures. In authenticating such Debentures and accepting the additional responsibilities under this Indenture in relation to such Debentures, the Trustee shall be entitled to receive, and (subject to Section 7.01) shall be fully protected in relying upon, (i) an Opinion of Counsel and (ii) an Officers' Certificate, each stating that the form and terms thereof have been established in conformity with the provisions of this Indenture. Each Opinion of Counsel and Officers' Certificate delivered pursuant to this Section 2.04 shall include all statements prescribed by Section 13.05(b) hereof. The Trustee shall not be required to authenticate such Debentures if the issue of such Debentures pursuant to this Indenture will, in the good faith judgment of the Trustee, affect the Trustee's own rights, duties or immunities under the Debentures and this Indenture or otherwise in a manner which is not reasonably acceptable to the Trustee. SECTION 2.05. (a) Debentures of any series may be exchanged upon presentation thereof at the office or agency of the Company designated for such purpose in the Borough of Manhattan, the City and State of New York, for other Debentures of such series of authorized denominations, and for a like aggregate principal amount, upon payment of a sum sufficient to cover any tax or other governmental charge in relation thereto, all as provided in this Section. In respect of any Debentures so surrendered for exchange, the Company shall execute, the Trustee shall authenticate and such office or agency shall deliver in exchange therefor the Debenture or Debentures of the same series which the Debentureholder making the exchange shall be entitled to receive, bearing numbers not contemporaneously outstanding. (b) The Company shall keep, or cause to be kept, at its office or agency designated for such purpose in the Borough of Manhattan, the City and State of New York, or such other location designated by the Company, a register or registers (herein referred to as the "Debenture Register") in which, subject to such reasonable regulations as it may prescribe, the Company shall register the Debentures and the transfers of Debentures as in this Article provided and which at all reasonable times shall be open for inspection by the Trustee. The registrar for the purpose of registering Debentures and transfer of Debentures as herein provided shall be appointed as authorized by Board Resolution (the "Debenture Registrar"). Upon surrender for transfer of any Debenture at the office or agency of the Company designated for such purpose in the Borough of Manhattan, the City and State of New York, the Company shall execute, the Trustee shall authenticate and such office or agency shall deliver in the name of the transferee or transferees a new Debenture or Debentures of the same series as the Debenture presented for a like aggregate principal amount. All Debentures presented or surrendered for exchange or registration of transfer, as provided in this Section, shall be accompanied (if so required by the Company or the Debenture Registrar) by a written instrument or instruments of transfer, in form satisfactory to the Company and the Debenture Registrar, duly executed by the registered holder or by his duly authorized attorney in writing. 9 (c) Except as provided in the first paragraph of Section 2.07, no service charge shall be made for any exchange or registration of transfer of Debentures, or issue of new Debentures in case of partial redemption of any series, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge in relation thereto, other than exchanges pursuant to Section 2.06, the second paragraph of Section 3.03 and Section 9.04 not involving any transfer. (d) The Company shall neither be required (i) to issue, exchange or register the transfer of any Debentures of any series during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of less than all the outstanding Debentures of the same series and ending at the close of business on the day of such mailing, nor (ii) to register the transfer of or exchange any Debentures of any series or portions thereof called for redemption. The provisions of this Section 2.05 are, with respect to any Global Debenture, subject to Section 2.11 hereof. SECTION 2.06. Pending the preparation of definitive Debentures of any series, the Company may execute, and the Trustee shall authenticate and deliver, temporary Debentures (printed, lithographed or typewritten) of any authorized denomination, and substantially in the form of the definitive Debentures in lieu of which they are issued, but with such omissions, insertions and variations as may be appropriate for temporary Debentures, all as may be determined by the Company. Every temporary Debenture of any series shall be executed by the Company and be authenticated by the Trustee upon the same conditions and in substantially the same manner, and with like effect, as the definitive Debentures of such series in accordance with the terms of Section 2.04 hereof. Without unnecessary delay the Company will execute and will furnish definitive Debentures of such series and thereupon any or all temporary Debentures of such series may be surrendered in exchange therefor (without charge to the holders), at the office or agency of the Company designated for the purpose in the Borough of Manhattan, the City and State of New York, and the Trustee shall authenticate and such office or agency shall deliver in exchange for such temporary Debentures an equal aggregate principal amount of definitive Debentures of such series, unless the Company advises the Trustee to the effect that definitive Debentures need not be executed and furnished until further notice from the Company. Until so exchanged, the temporary Debentures of such series shall be entitled to the same benefits under this Indenture as definitive Debentures of such series authenticated and delivered hereunder. SECTION 2.07. In case any temporary or definitive Debenture shall become mutilated or be destroyed, lost or stolen, the Company (subject to the next succeeding sentence) shall execute, and upon its request the Trustee (subject as aforesaid) shall authenticate and deliver, a new Debenture of the same series bearing a number not contemporaneously outstanding, in exchange and substitution for the mutilated Debenture, or in lieu of and in substitution for the Debenture so destroyed, lost or stolen. In every case the applicant for a substituted Debenture shall furnish to the Company and to the Trustee such security or indemnity as may be required by them to save each of them harmless, and, in every case of destruction, loss or theft, the applicant shall also furnish to the Company and to the Trustee evidence to their satisfaction of the destruction, loss or theft of the applicant's Debenture and of the ownership thereof. The Trustee may authenticate any such substituted Debenture and deliver the same upon the written order of the Company. Upon the issuance of any substituted Debenture, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) connected therewith. In case any Debenture which has matured or is about to mature shall become mutilated or be destroyed, lost or stolen, the Company may, instead of issuing a substitute Debenture, pay or authorize the payment of the same (without surrender thereof except in the case of a mutilated Debenture) if the applicant for such payment shall furnish to the Company and to the Trustee such security or indemnity as they may require to save them harmless, and, in case of destruction, loss or theft, evidence to the satisfaction of the Company and the Trustee of the destruction, loss or theft of such Debenture and of the ownership thereof. Every Debenture issued pursuant to the provisions of this Section in substitution for any Debenture which is mutilated, destroyed, lost or stolen shall constitute an additional contractual obligation of the Company, whether or not the mutilated, destroyed, lost or stolen Debenture shall 10 be found at any time, or be enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Debentures of the same series duly issued hereunder. All Debentures shall be held and owned upon the express condition that the foregoing provisions are exclusive with respect to the replacement or payment of mutilated, destroyed, lost or stolen Debentures, and shall preclude (to the extent lawful) any and all other rights or remedies, notwithstanding any law or statute existing or hereafter enacted to the contrary with respect to the replacement or payment of negotiable instruments or other securities without their surrender. SECTION 2.08. All Debentures surrendered for the purpose of payment, redemption, exchange or registration of transfer shall, if surrendered to the Company or any paying agent, be delivered to the Trustee for cancellation, or, if surrendered to the Trustee, shall be canceled by it, and no Debentures shall be issued in lieu thereof except as expressly required or permitted by any of the provisions of this Indenture. On request of the Company, the Trustee shall deliver to the Company canceled Debentures held by the Trustee. In the absence of such request the Trustee may dispose of canceled Debentures in accordance with its standard procedures. If the Company shall otherwise acquire any of the Debentures, however, such acquisition shall not operate as a redemption or satisfaction of the indebtedness represented by such Debentures unless and until the same are delivered to the Trustee for cancellation. SECTION 2.09. Nothing in this Indenture or in the Debentures, express or implied, shall give or be construed to give to any person, firm or corporation, other than the parties hereto and the holders of the Debentures, any legal or equitable right, remedy or claim under or in respect of this Indenture, or under any covenant, condition or provision herein contained; all such covenants, conditions and provisions being for the sole benefit of the parties hereto and of the holders of the Debentures. SECTION 2.10. So long as any of the Debentures of any series remain outstanding there may be an Authenticating Agent for any or all such series of Debentures which the Trustee shall have the right to appoint. Said Authenticating Agent shall be authorized to act on behalf of the Trustee to authenticate Debentures of such series issued upon exchange, transfer or partial redemption thereof, and Debentures so authenticated shall be entitled to the benefits of this Indenture and shall be valid and obligatory for all purposes as if authenticated by the Trustee hereunder. All references in this Indenture to the authentication of Debentures of any series by the Trustee shall be deemed to include authentication by an Authenticating Agent for such series except for authentication upon original issuance or pursuant to Section 2.07 hereof. Each Authenticating Agent shall be acceptable to the Company and shall be a corporation which has a combined capital and surplus, as most recently reported or determined by it, of 50 million dollars, and which is otherwise authorized under such laws to conduct a trust business and is subject to supervision or examination by Federal or State authorities. If at any time any Authenticating Agent shall cease to be eligible in accordance with these provisions, it shall resign immediately. Any Authenticating Agent may at any time resign by giving written notice of resignation to the Trustee and to the Company. The Trustee may at any time (and upon request by the Company shall) terminate the agency of any Authenticating Agent by giving written notice of termination to such Authenticating Agent and to the Company. Upon resignation, termination or cessation of eligibility of any Authenticating Agent, the Trustee may appoint an eligible successor Authenticating Agent acceptable to the Company. Any successor Authenticating Agent, upon acceptance of its appointment hereunder, shall become vested with all the rights, powers and duties of its predecessor hereunder as if originally named as an Authenticating Agent pursuant hereto. SECTION 2.11. (a) If the Company shall establish pursuant to Section 2.01 that the Debentures of a particular series are to be issued as a Global Debenture, then the Company shall execute and the Trustee shall, in accordance with Section 2.04, authenticate and deliver, a Global Debenture which (i) shall represent, and shall be denominated in an amount equal to the aggregate principal amount of, all of the Outstanding Debentures of such series, (ii) shall be registered in the name of the Depository or its nominee, (iii) shall be delivered by the Trustee to the Depository or pursuant to the Depository's instruction and (iv) shall bear a legend substantially to the following 11 effect: "Except as otherwise provided in Section 2.11 of the Indenture, this Debenture may be transferred, in whole but not in part, only to another nominee of the Depository or to a successor Depository or to a nominee of such successor Depository." (b) Notwithstanding the provisions of Section 2.05, the Global Debenture of a series may be transferred, in whole but not in part and in the manner provided in Section 2.05, only to another nominee of the Depository for such series, or to a successor Depository for such series selected or approved by the Company or to a nominee of such successor Depository. (c) If at any time the Depository for a series of Debentures notifies the Company that it is unwilling or unable to continue as Depository for such series or if at any time the Depository for such series shall no longer be registered or in good standing under the Exchange Act or other applicable statute or regulation and a successor Depository for such series is not appointed by the Company within 90 days after the Company receives such notice or becomes aware of such condition, as the case may be, this Section 2.11 shall no longer be applicable to the Debentures of such series and the Company will execute and, subject to Section 2.05, the Trustee will authenticate and deliver Debentures of such series in definitive registered form without coupons, in authorized denominations, and in an aggregate principal amount equal to the principal amount of the Global Debenture of such series in exchange for such Global Debenture. In addition, the Company may at any time determine that the Debentures of any series shall no longer be represented by a Global Debenture and that the provisions of this Section 2.11 shall no longer apply to the Debentures of such series. In such event the Company will execute and, subject to Section 2.05, the Trustee, upon receipt of an Officers' Certificate evidencing such determination by the Company, will authenticate and deliver Debentures of such series in definitive registered form without coupons, in authorized denominations, and in an aggregate principal amount equal to the principal amount of the Global Debenture of such series in exchange for such Global Debenture. Upon the exchange of the Global Debenture for such Debentures in definitive registered form without coupons, in authorized denominations, the Global Debenture shall be canceled by the Trustee. Such Debentures in definitive registered form issued in exchange for the Global Debenture pursuant to this Section 2.11(c) shall be registered in such names and in such authorized denominations as the Depository, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Debenture Registrar. The Trustee shall deliver such Debentures to the Depository for delivery to the persons in whose names such Debentures are so registered. ARTICLE THREE Redemption of Debentures and Sinking Fund Provisions SECTION 3.01. The Company may redeem the Debentures of any series issued hereunder on and after the dates and in accordance with the terms established for such series pursuant to Section 2.01 hereof. SECTION 3.02. (a) In case the Company shall desire to exercise such right to redeem all or, as the case may be, a portion of the Debentures of any series in accordance with the right reserved so to do, it shall give notice of such redemption to holders of the Debentures of such series to be redeemed by mailing, first class postage prepaid, a notice of such redemption not less than 30 days and not more than 60 days before the date fixed for redemption of that series to such holders at their last addresses as they shall appear upon the Debenture Register. Any notice which is mailed in the manner herein provided shall be conclusively presumed to have been duly given, whether or not the registered holder receives the notice. In any case, failure duly to give such notice to the holder of any Debenture of any series designated for redemption in whole or in part, or any defect in the notice, shall not affect the validity of the proceedings for the redemption of any other Debentures of such series or any other series. In the case of any redemption of Debentures prior to the expiration of any restriction on such redemption provided in the terms of such Debentures or elsewhere in this Indenture, the Company shall furnish the Trustee with an Officers' Certificate evidencing compliance with any such restriction. Each such notice of redemption shall specify the date fixed for redemption and the redemption price at which Debentures of that series are to be redeemed, and shall state that payment of the 12 redemption price of such Debentures to be redeemed will be made at the office or agency of the Company in the Borough of Manhattan, the City and State of New York, upon presentation and surrender of such Debentures, that interest accrued to the date fixed for redemption will be paid as specified in said notice, that from and after said date interest will cease to accrue, and that the redemption is for a sinking fund, if such is the case. If less than all the Debentures of a series are to be redeemed, the notice to the holders of Debentures of that series to be redeemed shall specify the particular Debentures to be so redeemed. In case any Debenture is to be redeemed in part only, the notice which relates to such Debenture shall state the portion of the principal amount thereof to be redeemed, and shall state that on and after the redemption date, upon surrender of such Debenture, a new Debenture or Debentures of such series in principal amount equal to the unredeemed portion thereof will be issued. (b) The Company shall give the Trustee at least 45 days' notice in advance of the date fixed for redemption (unless shorter notice shall be required by the Trustee) as to the aggregate principal amount of Debentures of the series to be redeemed, and thereupon the Trustee shall select, by lot or in such other manner as it shall deem appropriate and fair in its discretion and which may provide for the selection of a portion or portions (equal to $25 or any integral multiple thereof) of the principal amount of such Debentures of a denomination larger than $25, the Debentures to be redeemed and shall thereafter promptly notify the Company in writing of the numbers of the Debentures to be redeemed. The Company may, if and whenever it shall so elect, by delivery of instructions signed on its behalf by its President or any Vice President, instruct the Trustee or any paying agent to call all or any part of the Debentures of a particular series for redemption and to give notice of redemption in the manner set forth in this Section, such notice to be in the name of the Company or its own name as the Trustee or such paying agent may deem advisable. In any case in which notice of redemption is to be given by the Trustee or any such paying agent, the Company shall deliver or cause to be delivered to, or permit to remain with, the Trustee or such paying agent, as the case may be, such Debenture Register, transfer books or other records, or suitable copies or extracts therefrom, sufficient to enable the Trustee or such paying agent to give any notice by mail that may be required under the provisions of this Section. SECTION 3.03. (a) If the giving of notice of redemption shall have been completed as above provided, the Debentures or portions of Debentures of the series to be redeemed specified in such notice shall become due and payable on the date and at the place stated in such notice at the applicable redemption price, together with interest accrued to the date fixed for redemption, and interest on such Debentures or portions of Debentures shall cease to accrue on and after the date fixed for redemption, unless the Company shall default in the payment of such redemption price and accrued interest with respect to any such Debenture or portion thereof. On presentation and surrender of such Debentures on or after the date fixed for redemption at the place of payment specified in the notice, said Debentures shall be paid and redeemed at the applicable redemption price for such series, together with interest accrued thereon to the date fixed for redemption (but if the date fixed for redemption is an interest payment date, the interest installment payable on such date shall be payable to the registered holder at the close of business on the applicable record date pursuant to Section 2.03). (b) Upon presentation of any Debenture of such series which is to be redeemed in part only, the Company shall execute and the Trustee shall authenticate and the office or agency where the Debenture is presented shall deliver to the holder thereof, at the expense of the Company, a new Debenture or Debentures of the same series, of authorized denominations in principal amount equal to the unredeemed portion of the Debenture so presented. SECTION 3.04. The provisions of Sections 3.04, 3.05 and 3.06 shall be applicable to any sinking fund for the retirement of Debentures of a series, except as otherwise specified as contemplated by Section 2.01 for Debentures of such series. The minimum amount of any sinking fund payment provided for by the terms of Debentures of any series is herein referred to as a "mandatory sinking fund payment", and any payment in excess 13 of such minimum amount provided for by the terms of Debentures of any series is herein referred to as an "optional sinking fund payment". If provided for by the terms of Debentures of any series, the cash amount of any sinking fund payment may be subject to reduction as provided in Section 3.05. Each sinking fund payment shall be applied to the redemption of Debentures of any series as provided for by the terms of Debentures of such series. SECTION 3.05. The Company (i) may deliver Outstanding Debentures of a series (other than any previously called for redemption) and (ii) may apply as a credit Debentures of a series which have been redeemed either at the election of the Company pursuant to the terms of such Debentures or through the application of permitted optional sinking fund payments pursuant to the terms of such Debentures, in each case in satisfaction of all or any part of any sinking fund payment with respect to the Debentures of such series required to be made pursuant to the terms of such Debentures as provided for by the terms of such series; provided that such Debentures have not been previously so credited. Such Debentures shall be received and credited for such purpose by the Trustee at the redemption price specified in such Debentures for redemption through operation of the sinking fund and the amount of such sinking fund payment shall be reduced accordingly. SECTION 3.06. Not less than 45 days prior to each sinking fund payment date for any series of Debentures, the Company will deliver to the Trustee an Officers' Certificate specifying the amount of the next ensuing sinking fund payment for that series pursuant to the terms of that series, the portion thereof, if any, which is to be satisfied by delivering and crediting Debentures of that series pursuant to Section 3.05 and the basis for such credit and will, together with such Officers' Certificate, deliver to the Trustee any Debentures to be so delivered. Not less than 30 days before each such sinking fund payment date the Trustee shall select the Debentures to be redeemed upon such sinking fund payment date in the manner specified in Section 3.02 and cause notice of the redemption thereof to be given in the name of and at the expense of the Company in the manner provided in Section 3.02. Such notice having been duly given, the redemption of such Debentures shall be made upon the terms and in the manner stated in Section 3.03. ARTICLE FOUR Particular Covenants of the Company The Company covenants and agrees for each series of the Debentures as follows: SECTION 4.01. The Company will duly and punctually pay or cause to be paid the principal of (and premium, if any) and interest on the Debentures of that series at the time and place and in the manner provided herein and established with respect to such Debentures. SECTION 4.02. So long as any series of the Debentures remains outstanding, the Company agrees to maintain an office or agency in the Borough of Manhattan, the City and State of New York, with respect to each such series and at such other location or locations as may be designated as provided in this Section 4.02, where (i) Debentures of that series may be presented for payment, (ii) Debentures of that series may be presented as hereinabove authorized for registration of transfer and exchange, and (iii) notices and demands to or upon the Company in respect of the Debentures of that series and this Indenture may be given or served, such designation to continue with respect to such office or agency until the Company shall, by written notice signed by its President or a Vice President and delivered to the Trustee, designate some other office or agency for such purposes or any of them. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, notices and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent to receive all such presentations, notices and demands. SECTION 4.03. (a) If the Company shall appoint one or more paying agents for all or any series of the Debentures, other than the Trustee, the Company will cause each such paying agent to execute and deliver to the Trustee an instrument in which such agent shall agree with the Trustee, subject to the provisions of this Section: 14 (1) that it will hold all sums held by it as such agent for the payment of the principal of (and premium, if any) or interest on the Debentures of that series (whether such sums have been paid to it by the Company or by any other obligor of such Debentures) in trust for the benefit of the persons entitled thereto; (2) that it will give the Trustee notice of any failure by the Company (or by any other obligor of such Debentures) to make any payment of the principal of (and premium, if any) or interest on the Debentures of that series when the same shall be due and payable; (3) that it will, at any time during the continuance of any failure referred to in the preceding paragraph (a)(2) above, upon the written request of the Trustee, forthwith pay to the Trustee all sums so held in trust by such paying agent; and (4) that it will perform all other duties of paying agent as set forth in this Indenture. (b) If the Company shall act as its own paying agent with respect to any series of the Debentures, it will on or before each due date of the principal of (and premium, if any) or interest on Debentures of that series, set aside, segregate and hold in trust for the benefit of the persons entitled thereto a sum sufficient to pay such principal (and premium, if any) or interest so becoming due on Debentures of that series until such sums shall be paid to such persons or otherwise disposed of as herein provided and will promptly notify the Trustee of such action, or any failure (by it or any other obligor on such Debentures) to take such action. Whenever the Company shall have one or more paying agents for any series of Debentures, it will, prior to each due date of the principal of (and premium, if any) or interest on any Debentures of that series, deposit with the paying agent a sum sufficient to pay the principal (and premium, if any) or interest so becoming due, such sum to be held in trust for the benefit of the persons entitled to such principal, premium or interest, and (unless such paying agent is the Trustee) the Company will promptly notify the Trustee of its action or failure so to act. (c) Anything in this Section to the contrary notwithstanding, (i) the agreement to hold sums in trust as provided in this Section is subject to the provisions of Section 11.06, and (ii) the Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or direct any paying agent to pay, to the Trustee all sums held in trust by the Company or such paying agent, such sums to be held by the Trustee upon the same terms and conditions as those upon which such sums were held by the Company or such paying agent; and, upon such payment by any paying agent to the Trustee, such paying agent shall be released from all further liability with respect to such sums. SECTION 4.04. The Company, whenever necessary to avoid or fill a vacancy in the office of Trustee, will appoint, in the manner provided in Section 7.10, a Trustee, so that there shall at all times be a Trustee hereunder. SECTION 4.05. The Company will not, while any of the Debentures remain outstanding, consolidate with, or merge into, or merge into itself, or sell or convey all or substantially all of its property to any other company unless the provisions of Article Ten hereof are complied with. SECTION 4.06. The Company will not declare or pay any dividend on, or redeem, purchase, acquire or make a distribution or liquidation payment with respect to, any of its capital stock if at such time (i) there shall have occurred any event that would, with the giving of notice or the passage of time, or both, constitute an Event of Default under the Indenture, or (ii) the Company shall have given notice of its selection of an extended interest payment period as provided in the Indenture and such period, or any extension thereof, shall be continuing. 15 ARTICLE FIVE Debentureholders' Lists and Reports by the Company and the Trustee SECTION 5.01. The Company will furnish or cause to be furnished to the Trustee (a) on a monthly basis on each regular record date (as defined in Section 2.03) a list, in such form as the Trustee may reasonably require, of the names and addresses of the holders of each series of Debentures as of such regular record date, provided, that the Company shall not be obligated to furnish or cause to furnish such list at any time that the list shall not differ in any respect from the most recent list furnished to the Trustee by the Company and (b) at such other times as the Trustee may request in writing within 30 days after the receipt by the Company of any such request, a list of similar form and content as of a date not more than 15 days prior to the time such list is furnished; provided, however, no such list need be furnished for any series for which the Trustee shall be the Debenture Registrar. SECTION 5.02. (a) The Trustee shall preserve, in as current a form as is reasonably practicable, all information as to the names and addresses of the holders of Debentures contained in the most recent list furnished to it as provided in Section 5.01 and as to the names and addresses of holders of Debentures received by the Trustee in its capacity as Debenture Registrar (if acting in such capacity). (b) The Trustee may destroy any list furnished to it as provided in Section 5.01 upon receipt of a new list so furnished. (c) In case three or more holders of Debentures of a series (hereinafter referred to as "applicants") apply in writing to the Trustee, and furnish to the Trustee reasonable proof that each such applicant has owned a Debenture for a period of at least six months preceding the date of such application, and such application states that the applicants desire to communicate with other holders of Debentures of such series or holders of all Debentures with respect to their rights under this Indenture or under such Debentures, and is accompanied by a copy of the form of proxy or other communication which such applicants propose to transmit, then the Trustee shall, within five business days after the receipt of such application, at its election, either: (1) afford to such applicants access to the information preserved at the time by the Trustee in accordance with the provisions of subsection (a) of Section 5.02; or (2) inform such applicants as to the approximate number of holders of Debentures of such series or of all Debentures, as the case may be, whose names and addresses appear in the information preserved at the time by the Trustee, in accordance with the provisions of subsection (a) of Section 5.02, and as to the approximate cost of mailing to such Debentureholders the form of proxy or other communication, if any, specified in such application. (d) If the Trustee shall elect not to afford such applicants access to such information, the Trustee shall, upon the written request of such applicants, mail to each holder of such series or of all Debentures, as the case may be, whose name and address appears in the information preserved at the time by the Trustee in accordance with the provisions of subsection (a) of Section 5.01, a copy of the form of proxy or other communication which is specified in such request, with reasonable promptness after a tender to the Trustee of the material to be mailed and of payment, or provision for the payment, of the reasonable expenses of mailing, unless within five days after such tender, the Trustee shall mail to such applicants and file with the Securities and Exchange Commission (the "Commission"), together with a copy of the material to be mailed, a written statement to the effect that, in the opinion of the Trustee, such mailing would be contrary to the best interests of the holders of Debentures of such series or of all Debentures, as the case may be, or would be in violation of applicable law. Such written statement shall specify the basis of such opinion. If the Commission, after opportunity for a hearing upon the objections specified in the written statement so filed, shall enter an order refusing to sustain any of such objections or if, after the entry of an order sustaining one or more of such objections, the Commission shall find, after notice and opportunity for hearing, 16 that all the objections so sustained have been met and shall enter an order so declaring, the Trustee shall mail copies of such material to all such Debentureholders with reasonable promptness after the entry of such order and the renewal of such tender; otherwise, the Trustee shall be relieved of any obligation or duty to such applicants respecting their application. (e) Each and every holder of the Debentures, by receiving and holding the same, agrees with the Company and the Trustee that neither the Company nor the Trustee nor any paying agent nor any Debenture Registrar shall be held accountable by reason of the disclosure of any such information as to the names and addresses of the holders of Debentures in accordance with the provisions of subsection (c) of this Section, regardless of the source from which such information was derived, and that the Trustee shall not be held accountable by reason of mailing any material pursuant to a request made under said subsection (c). SECTION 5.03. (a) The Company covenants and agrees to file with the Trustee, within 15 days after the Company is required to file the same with the Commission, copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe) which the Company may be required to file with the Commission pursuant to Section 13 or Section 15(d) of the Exchange Act; or, if the Company is not required to file information, documents or reports pursuant to either of such sections, then to file with the Trustee and the Commission, in accordance with the rules and regulations prescribed from time to time by the Commission, such of the supplementary and periodic information, documents and reports which may be required pursuant to Section 13 of the Exchange Act, in respect of a security listed and registered on a national securities exchange as may be prescribed from time to time in such rules and regulations. (b) The Company covenants and agrees to file with the Trustee and the Commission, in accordance with the rules and regulations prescribed from time to time by the Commission, such additional information, documents and reports with respect to compliance by the Company with the conditions and covenants provided for in this Indenture as may be required from time to time by such rules and regulations. Delivery of such reports, documents and information to the Trustee under this subsection (b) and subsection (a) of Section 5.03 is for informational purposes only and the Trustee's receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company's compliance with any of the covenants hereunder. (c) The Company covenants and agrees to transmit by mail, first class postage prepaid, or reputable over-night delivery service which provides for evidence of receipt, to the Debentureholders, as their names and addresses appear upon the Debenture Register, within 30 days after the filing thereof with the Trustee, such summaries of any information, documents and reports required to be filed by the Company pursuant to subsections (a) and (b) of this Section as may be required by rules and regulations prescribed from time to time by the Commission. (d) The Company covenants and agrees to furnish to the Trustee, on or before May 15 in each calendar year in which any of the Debentures are outstanding, or on or before such other day in each calendar year as the Company and the Trustee may from time to time agree upon, a Certificate as to his or her knowledge of the Company's compliance with all conditions and covenants under this Indenture. For purposes of this subsection (d), such compliance shall be determined without regard to any period of grace or requirement of notice provided under this Indenture. (e) The Company covenants and agrees, during any calendar year in which original issue discount has accrued on Outstanding Debentures, to file with the Trustee promptly at the end of each such calendar year a written notice specifying the amount of original issue discount (including daily rates and accrual periods) accrued on Outstanding Debentures as of the end of such year. SECTION 5.04. (a) On or before July 15 in each year in which any of the Debentures are outstanding, the Trustee shall transmit by mail, first class postage prepaid, to the Debentureholders, as their names and addresses appear upon the Debenture Register, a brief report dated as of the preceding May 15, with respect to any of the following events which may have occurred within the 17 previous twelve months (but if no such event has occurred within such period no report need be transmitted): (1) any change to its eligibility under Section 7.09, and its qualifications under Section 7.08; (2) the creation of or any material change to a relationship specified in paragraphs (1) through (10) of subsection (c) of Section 7.08; (3) the character and amount of any advances (and if the Trustee elects so to state, the circumstances surrounding the making thereof) made by the Trustee (as such) which remain unpaid on the date of such report, and for the reimbursement of which it claims or may claim a lien or charge, prior to that of the Debentures, on any property or funds held or collected by it as Trustee if such advances so remaining unpaid aggregate more than 1/2 of 1% of the principal amount of the Debentures outstanding on the date of such report; (4) any change to the amount, interest rate, and maturity date of all other indebtedness owing by the Company, or by any other obligor on the Debentures, to the Trustee in its individual capacity, on the date of such report, with a brief description of any property held as collateral security therefor, except any indebtedness based upon a creditor relationship arising in any manner described in paragraphs (2), (3), (4), or (6) of subsection (b) of Section 7.13; (5) any change to the property and funds, if any, physically in the possession of the Trustee as such on the date of such report; (6) any release, or release and substitution, of property subject to the lien, if any, of this Indenture (and the consideration thereof, if any) which it has not previously reported; (7) any additional issue of Debentures which the Trustee has not previously reported; and (8) any action taken by the Trustee in the performance of its duties under this Indenture which it has not previously reported and which in its opinion materially affects the Debentures or the Debentures of any series, except any action in respect of a default, notice of which has been or is to be withheld by it in accordance with the provisions of Section 6.07. (b) The Trustee shall transmit by mail, first class postage prepaid, to the Debentureholders, as their names and addresses appear upon the Debenture Register, a brief report with respect to the character and amount of any advances (and if the Trustee elects so to state, the circumstances surrounding the making thereof) made by the Trustee as such since the date of the last report transmitted pursuant to the provisions of subsection (a) of this Section (or if no such report has yet been so transmitted, since the date of execution of this Indenture), for the reimbursement of which it claims or may claim a lien or charge prior to that of the Debentures of any series on property or funds held or collected by it as Trustee, and which it has not previously reported pursuant to this subsection if such advances remaining unpaid at any time aggregate more than 10% of the principal amount of Debentures of such series outstanding at such time, such report to be transmitted within 90 days after such time. (c) A copy of each such report shall, at the time of such transmission to Debentureholders, be filed by the Trustee with the Company, with each stock exchange upon which any Debentures are listed (if so listed) and also with the Commission. The Company agrees to notify the Trustee when any Debentures become listed on any stock exchange. 18 ARTICLE SIX Remedies of the Trustee and Debentureholders on Event of Default SECTION 6.01. (a) Whenever used herein with respect to Debentures of a particular series, "Event of Default" means any one or more of the following events which has occurred and is continuing: (1) default in the payment of any installment of interest upon any of the Debentures of that series, as and when the same shall become due and payable, and continuance of such default for a period of 10 days; (2) default in the payment of the principal of (or premium, if any, on) any of the Debentures of that series as and when the same shall become due and payable, whether at maturity, upon redemption, by declaration or otherwise, or in any payment required by any sinking or analogous fund established with respect to that series; (3) failure on the part of the Company duly to observe or perform any other of the covenants or agreements on the part of the Company with respect to that series contained in such Debentures or otherwise established with respect to that series of Debentures pursuant to Section 2.01 hereof or contained in this Indenture (other than a covenant or agreement which has been expressly included in this Indenture solely for the benefit of one or more series of Debentures other than such series) for a period of 90 days after the date on which written notice of such failure, requiring the same to be remedied and stating that such notice is a "Notice of Default" hereunder, shall have been given to the Company by the Trustee, by registered or certified mail, or to the Company and the Trustee by the holders of at least 25% in principal amount of the Debentures of that series at the time outstanding; (4) a decree or order by a court having jurisdiction in the premises shall have been entered adjudging the Company a bankrupt or insolvent, or approving as properly filed a petition seeking liquidation or reorganization of the Company under the Federal Bankruptcy Code or any other similar applicable Federal or State law, and such decree or order shall have continued unvacated and unstayed for a period of 90 days; or an involuntary case shall be commenced under such Code in respect of the Company and shall continue undismissed for a period of 90 days or an order for relief in such case shall have been entered; or a decree or order of a court having jurisdiction in the premises shall have been entered for the appointment on the ground of insolvency or bankruptcy of a receiver or custodian or liquidator or trustee or assignee in bankruptcy or insolvency of the Company or of its property, or for the winding up or liquidation of its affairs, and such decree or order shall have remained in force unvacated and unstayed for a period of 90 days; or (5) the Company shall institute proceedings to be adjudicated a voluntary bankrupt, or shall consent to the filing of a bankruptcy proceeding against it, or shall file a petition or answer or consent seeking liquidation or reorganization under the Federal Bankruptcy Code or other similar applicable Federal or State law, or shall consent to the filing of any such petition or shall consent to the appointment on the ground of insolvency or bankruptcy of a receiver or custodian or liquidator or trustee or assignee in bankruptcy or insolvency of it or of its property, or shall make an assignment for the benefit of creditors. (b) In each and every such case, the Company shall file with the Trustee written notice of the occurrence of any Event of Default within five business days of the Company's becoming aware of any such Event of Default, and unless the principal of all the Debentures of that series shall have already become due and payable, either the Trustee or the holders of not less than 25% in aggregate principal amount of the Debentures of that series then outstanding hereunder, by notice in writing to the Company (and to the Trustee if given by such Debentureholders), may declare the principal of all the Debentures of that series to be due and payable immediately, and upon any such declaration the same shall become and shall be immediately due and payable, anything contained in 19 this Indenture or in the Debentures of that series or established with respect to that series pursuant to Section 2.01 hereof to the contrary notwithstanding. (c) The provisions of subsection (b) of this Section, however, are subject to the condition that if, at any time after the principal of the Debentures of that series shall have been so declared due and payable, and before any judgment or decree for the payment of the moneys due shall have been obtained or entered as hereinafter provided, the Company shall pay or shall deposit with the Trustee a sum sufficient to pay all matured installments of interest upon all the Debentures of that series and the principal of (and premium, if any, on) any and all Debentures of that series which shall have become due otherwise than by acceleration (with interest upon such principal and premium, if any, and, to the extent that such payment is enforceable under applicable law, upon overdue installments of interest, at the rate per annum expressed in the Debentures of that series to the date of such payment or deposit) and the amount payable to the Trustee under Section 7.06, and any and all defaults under the Indenture, other than the nonpayment of principal on Debentures of that series which shall not have become due by their terms, shall have been remedied or waived as provided in Section 6.06, then and in every such case the holders of a majority in aggregate principal amount of the Debentures of that series then outstanding, by written notice to the Company and to the Trustee, may rescind and annul such declaration and its consequences; but no such rescission and annulment shall extend to or shall affect any subsequent default, or shall impair any right consequent thereon. (d) In case the Trustee shall have proceeded to enforce any right with respect to Debentures of that series under this Indenture and such proceedings shall have been discontinued or abandoned because of such rescission or annulment or for any other reason or shall have been determined adversely to the Trustee, then and in every such case the Company and the Trustee shall be restored respectively to their former positions and rights hereunder, and all rights, remedies and powers of the Company and the Trustee shall continue as though no such proceedings had been taken. SECTION 6.02. (a) The Company covenants that (1) in case default shall be made in the payment of any installment of interest on any of the Debentures of a series, or and such default shall have continued for a period of 10 business days, or (2) in case default shall be made in the payment of the principal of (or premium, if any, on) any of the Debentures of a series when the same shall have become due and payable, whether upon maturity of the Debentures of a series or upon redemption or upon declaration or otherwise, or in any payment required by any sinking or analogous fund established with respect to that series as and when the same shall have become due and payable, then, upon demand of the Trustee, the Company will pay to the Trustee, for the benefit of the holders of the Debentures of that series, the whole amount that then shall have become due and payable on all such Debentures for principal (and premium, if any) or interest, or both, as the case may be, with interest upon the overdue principal (and premium, if any) and (to the extent that payment of such interest is enforceable under applicable law) upon overdue installments of interest at the rate per annum expressed in the Debentures of that series; and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, and the amount payable to the Trustee under Section 7.06. (b) In case the Company shall fail forthwith to pay such amounts upon such demand, the Trustee, in its own name and as trustee of an express trust, shall be entitled and empowered to institute any action or proceedings at law or in equity for the collection of the sums so due and unpaid, and may prosecute any such action or proceeding to judgment or final decree, and may enforce any such judgment or final decree against the Company or other obligor upon the Debentures of that series and collect in the manner provided by law out of the property of the Company or other obligor upon the Debentures of that series wherever situated the moneys adjudged or decreed to be payable. (c) In case of any receivership, insolvency, liquidation, bankruptcy, reorganization, readjustment, arrangement, composition or other judicial proceedings affecting the Company, any other obligor on such Debentures, or the creditors or property of either, the Trustee shall have power to intervene in such proceedings and take any action therein that may be permitted by the court and shall (except as may be otherwise provided by law) be entitled to file such proofs of claim and other papers and documents as may be necessary or advisable in order to have the claims of the Trustee 20 and of the holders of Debentures of such series allowed for the entire amount due and payable by the Company or such other obligor under the Indenture at the date of institution of such proceedings and for any additional amount which may become due and payable by the Company or such other obligor after such date, and to collect and receive any moneys or other property payable or deliverable on any such claim, and to distribute the same after the deduction of the amount payable to the Trustee under Section 7.06; and any receiver, assignee or trustee in bankruptcy or reorganization is hereby authorized by each of the holders of Debentures of such series to make such payments to the Trustee, and, in the event that the Trustee shall consent to the making of such payments directly to such Debentureholders, to pay to the Trustee any amount due it under Section 7.06. (d) All rights of action and of asserting claims under this Indenture, or under any of the terms established with respect to Debentures of that series, may be enforced by the Trustee without the possession of any of such Debentures, or the production thereof at any trial or other proceeding relative thereto, and any such suit or proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for payment to the Trustee of any amounts due under Section 7.06, be for the ratable benefit of the holders of the Debentures of such series. In case of an Event of Default hereunder, the Trustee may in its discretion proceed to protect and enforce the rights vested in it by this Indenture by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any of such rights, either at law or in equity or in bankruptcy or otherwise, whether for the specific enforcement of any covenant or agreement contained in the Indenture or in aid of the exercise of any power granted in this Indenture, or to enforce any other legal or equitable right vested in the Trustee by this Indenture or by law. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Debentureholder any plan of reorganization, arrangement, adjustment or composition affecting the Debentures of that series or the rights of any holder thereof or to authorize the Trustee to vote in respect of the claim of any Debentureholder in any such proceeding. SECTION 6.03. Any moneys collected by the Trustee pursuant to Section 6.02 with respect to a particular series of Debentures shall be applied in the order following, at the date or dates fixed by the Trustee and, in case of the distribution of such moneys on account of principal (or premium, if any) or interest, upon presentation of the several Debentures of that series, and stamping thereon the payment, if only partially paid, and upon surrender thereof if fully paid: FIRST: To the payment of costs and expenses of collection and of all amounts payable to the Trustee under Section 7.06; SECOND: To the payment of the amounts then due and unpaid upon Debentures of such series for principal (and premium, if any) and interest, in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Debentures for principal (and premium, if any) and interest, respectively; and THIRD: To the Company. SECTION 6.04. No holder of any Debenture of any series shall have any right by virtue or by availing of any provision of this Indenture to institute any suit, action or proceeding in equity or at law upon or under or with respect to this Indenture or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless such holder previously shall have given to the Trustee written notice of an Event of Default and of the continuance thereof with respect to Debentures of such series specifying such Event of Default, as hereinbefore provided, and unless also the holders of not less than 25% in aggregate principal amount of the Debentures of such series then outstanding shall have made written request upon the Trustee to institute such action, suit or proceeding in its own name as trustee hereunder and shall have offered to the Trustee such reasonable indemnity as it may require against the costs, expenses and liabilities to be incurred therein or 21 thereby, and the Trustee for 60 days after its receipt of such notice, request and offer of indemnity, shall have failed to institute any such action, suit or proceeding; it being understood and intended, and being expressly covenanted by the taker and holder of every Debenture of such series with every other such taker and holder and the Trustee, that no one or more holders of Debentures of such series shall have any right in any manner whatsoever by virtue or by availing of any provision of this Indenture to affect, disturb or prejudice the rights of the holders of any other of such Debentures, or to obtain or seek to obtain priority over or preference to any other such holder, or to enforce any right under this Indenture, except in the manner herein provided and for the equal, ratable and common benefit of all holders of Debentures of such series. For the protection and enforcement of the provisions of this Section, each and every Debentureholder and the Trustee shall be entitled to such relief as can be given either at law or in equity. Notwithstanding any other provisions of this Indenture, however, the right of any holder of any Debenture to receive payment of the principal of (and premium, if any) and interest on such Debenture, as therein provided, on or after the respective due dates expressed in such Debenture (or in the case of redemption, on the redemption date), or to institute suit for the enforcement of any such payment on or after such respective dates or redemption date, shall not be impaired or affected without the consent of such holder. SECTION 6.05. (a) All powers and remedies given by this Article to the Trustee or to the Debentureholders shall, to the extent permitted by law, be deemed cumulative and not exclusive of any others thereof or of any other powers and remedies available to the Trustee or the holders of the Debentures, by judicial proceedings or otherwise, to enforce the performance or observance of the covenants and agreements contained in this Indenture or otherwise established with respect to such Debentures. (b) No delay or omission of the Trustee or of any holder of any of the Debentures to exercise any right or power accruing upon any Event of Default occurring and continuing as aforesaid shall impair any such right or power, or shall be construed to be a waiver of any such default or an acquiescence therein; and, subject to the provisions of Section 6.04, every power and remedy given by this Article or by law to the Trustee or to the Debentureholders may be exercised from time to time, and as often as shall be deemed expedient, by the Trustee or by the Debentureholders. SECTION 6.06. The holders of a majority in aggregate principal amount of the Debentures of any series at the time outstanding, determined in accordance with Section 8.04, shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee with respect to such series; provided, however, that such direction shall not be in conflict with any rule of law or with this Indenture or unduly prejudicial to the rights of holders of Debentures of any other series at the time outstanding determined in accordance with Section 8.04 not parties thereto. Subject to the provisions of Section 7.01, the Trustee shall have the right to decline to follow any such direction if the Trustee in good faith shall, by a Responsible Officer or Officers of the Trustee, determine that the proceeding so directed might involve the Trustee in personal liability. The holders of a majority in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, determined in accordance with Section 8.04, may on behalf of the holders of all of the Debentures of such series waive any past default in the performance of any of the covenants contained herein or established pursuant to Section 2.01 with respect to such series and its consequences, except a default in the payment of the principal of, or premium, if any, or interest on, any of the Debentures of that series as and when the same shall become due by the terms of such Debentures or a call for redemption of Debentures of that series, which default may be waived by the unanimous consent of the holders affected. Upon any such waiver, the default covered thereby shall be deemed to be cured for all purposes of this Indenture and the Company, the Trustee and the holders of the Debentures of such series shall be restored to their former positions and rights hereunder, respectively; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon. SECTION 6.07. The Trustee shall, within 90 days after the occurrence of a default with respect to a particular series, transmit by mail, first class postage prepaid, to the holders of Debentures of that series, as their names and addresses appear upon the Debenture Register, notice 22 of all defaults with respect to that series known to the Trustee, unless such defaults shall have been cured or waived before the giving of such notice (the term "defaults" for the purposes of this Section being hereby defined to be the events specified in subsections (1), (2), (3), (4) and (5) of Section 6.01(a), not including any periods of grace provided for therein and irrespective of the giving of notice provided for by subsection (3) of Section 6.01(a)); provided, that, except in the case of default in the payment of the principal of (or premium, if any) or interest on any of the Debentures of that series or in the payment of any sinking fund installment established with respect to that series, the Trustee shall be protected in withholding such notice if and so long as the board of directors, the executive committee, or a trust committee of directors and/or Responsible Officers, of the Trustee in good faith determine that the withholding of such notice is in the interests of the holders of Debentures of that series; provided further, that in the case of any default of the character specified in Section 6.01(a)(3) with respect to Debentures of such series, no such notice to the holders of the Debentures of that series shall be given until at least 30 days after the occurrence thereof. The Trustee shall not be deemed to have knowledge of any default, except (i) a default under subsections (a)(1) or (a)(2) of Section 6.01 as long as the Trustee is acting as paying agent for such series of Debentures or (ii) any default as to which the Trustee shall have received written notice or a Responsible Officer charged with the administration of this Indenture shall have actual knowledge or obtained written notice. SECTION 6.08. All parties to this Indenture agree, and each holder of any Debentures by his or her acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any action taken or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys' fees, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section shall not apply to any suit instituted by the Trustee, to any suit instituted by any Debentureholder, or group of Debentureholders, holding more than 10% in aggregate principal amount of the outstanding Debentures of any series, or to any suit instituted by any Debentureholder for the enforcement of the payment of the principal of (or premium, if any) or interest on any Debenture of such series, on or after the respective due dates expressed in such Debenture or established pursuant to this Indenture. ARTICLE SEVEN Concerning the Trustee SECTION 7.01. (a) The Trustee, prior to the occurrence of an Event of Default with respect to Debentures of a series and after the curing of all Events of Default with respect to Debentures of that series which may have occurred, shall undertake to perform with respect to Debentures of such series such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants shall be read into this Indenture against the Trustee. In case an Event of Default with respect to Debentures of a series has occurred (which has not be cured or waived), the Trustee shall exercise with respect to Debentures of that series such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. (b) No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that: (1) prior to the occurrence of an Event of Default with respect to Debentures of a series and after the curing and waiving of all such Events of Default with respect to that series which may have occurred: (i) the duties and obligations of the Trustee shall with respect to Debentures of such series be determined solely by the express provisions of this Indenture, and the Trustee shall not be liable with respect to Debentures of such 23 series except for the performance of such duties and obligations as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and (ii) in the absence of bad faith on the part of the Trustee, the Trustee may with respect to Debentures of such series conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein); (2) the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer or Responsible Officers of the Trustee, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts; (3) the Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the holders of not less than a majority in principal amount of the Debentures of any series at the time outstanding relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee under this Indenture with respect to the Debentures of that series; and (4) None of the provisions contained in this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur or risk personal financial liability in the performance of any of its duties or in the exercise of any of its rights or powers, if there is reasonable ground for believing that the repayment of such funds or liability is not reasonably assured to it under the terms of this Indenture or adequate indemnity against such risk is not reasonably assured to it. (c) Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section 7.01. SECTION 7.02. Except as otherwise provided in Section 7.01: (a) The Trustee may rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, approval, bond, security or other paper or document believed by it to be genuine and to have been signed or presented by the property party or parties; (b) Any request, direction, order or demand of the Company mentioned herein shall be sufficiently evidenced by a Board Resolution or an instrument signed in the name of the Company by the President or any Vice President and by the Secretary or an Assistant Secretary or the Treasurer or an Assistant Treasurer (unless other evidence in respect thereof is specifically prescribed herein); (c) Whenever in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Trustee (unless other evidence be herein specifically prescribed) is entitled to receive and may, in the absence of bad faith on its part, rely upon an Officers' Certificate; (d) The Trustee may consult with counsel of its selection and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken or suffered or omitted hereunder in good faith and in reliance thereon; 24 (e) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request, order or direction of any of the Debentureholders, pursuant to the provisions of this Indenture, unless such Debentureholders shall have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities which may be incurred therein or thereby; nothing herein contained shall, however, relieve the Trustee of the obligation, upon the occurrence of an Event of Default with respect to a series of the Debentures (which has not been cured or waived) to exercise with respect to Debentures of that series such of the rights and powers vested in it by this Indenture, and to use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs; (f) If an Event of Default shall have occurred and be continuing, the Trustee shall be under no obligation to follow any request, order or direction of the Company if in the reasonable judgment of the Trustee the following of such request, order or direction would not be in the best interests of all the holders; (g) The Trustee shall not be liable for any action taken or omitted to be taken by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture; (h) The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, approval, bond, security, or other papers or documents, unless requested in writing so to do by the holders of not less than a majority in principal amount of the outstanding Debentures of the particular series affected thereby (determined as provided in Section 8.04); provided, however, that if the payment within a reasonable time to the Trustee of the costs, expenses or liabilities likely to be incurred by it in the making of such investigation is, in the opinion of the Trustee, not reasonably assured to the Trustee by the security afforded to it by the terms of this Indenture, the Trustee may require reasonable indemnity against such costs, expenses or liabilities as a condition to so proceeding. The reasonable expense of every such examination shall be paid by the Company or, if paid by the Trustee, shall be repaid by the Company upon demand; (i) The Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder; and (j) Any application by the Trustee for written instructions from the Company may, at the option of the Trustee, set forth in writing any action proposed to be taken or omitted by the Trustee under this Indenture and the date on and/or after which such action shall be taken or such omission shall be effective. The Trustee shall not be liable for any action or omission of the Trustee in accordance with a proposal included in such application on or after the date specified in such application (which date shall not be less than three business days after the date any officer of the Company actually receives such application, unless any such officer shall have consented in writing to any earlier date) unless prior to taking any such action (or the effective date in the case of an omission), the Trustee shall have received written instructions in response to such application specifying the action to be taken or omitted.. SECTION 7.03. (a) The recitals contained herein and in the Debentures (other than the Certificate of Authentication on the Debentures) shall be taken as the statements of the Company, and the Trustee assumes no responsibility for the correctness of the same. (b) The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Debentures. (c) The Trustee shall not be accountable for the use or application by the Company of any of the Debentures or of the proceeds of such Debentures, or for the use or application of any 25 moneys paid over by the Trustee in accordance with any provision of this Indenture or established pursuant to Section 2.01, or for the use or application of any moneys received by any paying agent other than the Trustee. SECTION 7.04. The Trustee or any paying agent or Debenture Registrar, in its individual or any other capacity, may become the owner or pledgee of Debentures with the same rights it would have if it were not Trustee, paying agent or Debenture Registrar. SECTION 7.05. Subject to the provisions of Section 11.06, all moneys received by the Trustee shall, until used or applied as herein provided, be held in trust for the purposes for which they were received, but need not be segregated from other funds except to the extent required by law. The Trustee shall be under no liability for interest on any moneys received by it hereunder except such as it may agree with the Company to pay thereon. SECTION 7.06. (a) The Company covenants and agrees to pay to the Trustee from time to time, and the Trustee shall be entitled to, such compensation as the Company and the Trustee may agree upon (which shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust) for all services rendered by it in the execution of the trusts hereby created and in the exercise and performance of any of the powers and duties hereunder of the Trustee, and the Company will pay or reimburse the Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made by the Trustee in accordance with any of the provisions of this Indenture (including the reasonable compensation and the expenses and disbursements of its counsel and of all persons not regularly in its employ) except any such expense, disbursement or advance as may arise from its negligence or bad faith. The Company also covenants to indemnify the Trustee (and its officers, agents, directors and employees) for, and to hold it harmless against, any loss, damage, claim, liability or expense incurred without negligence or bad faith on the part of the Trustee and arising out of or in connection with the acceptance or administration of this trust, including the costs and expenses of defending itself against any claim of liability in the premises. (b) The obligations of the Company under this Section to compensate and indemnify the Trustee and to pay or reimburse the Trustee for expenses, disbursements and advances shall constitute additional indebtedness hereunder and shall survive the termination of this Indenture. Such additional indebtedness shall be a senior lien to that of the Debentures upon all property and funds held or collected by the Trustee as such, except funds held in trust for the benefit of the holders of particular Debentures, and the Debentures are hereby subordinated to each such senior lien. (c) When the Trustee incurs expenses or renders services in connection with an Event of Default, the expenses (including the reasonable charges and expenses of its counsel) and compensation for its services are intended to constitute expenses of administration under applicable federal or state bankruptcy, insolvency or similar law. SECTION 7.07. Except as otherwise provided in Section 7.01, whenever in the administration of the provisions of this Indenture the Trustee shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering or omitting to take any action hereunder, it shall be entitled to receive, and such matter (unless other evidence in respect thereof be herein specifically prescribed) may in the absence of negligence or bad faith on the part of the Trustee be deemed to be conclusively provided and established by, an Officers' Certificate delivered to the Trustee and such certificate, in the absence of negligence or bad faith on the part of the Trustee, shall be full warrant to the Trustee for any action taken, suffered or omitted to be taken by it under the provisions of this Indenture upon the faith thereof. SECTION 7.08. If the Trustee has or shall acquire a conflicting interest within the meaning of the Trust Indenture Act, the Trustee shall either eliminate such interest or resign, to the extent and in the manner provided by, and subject to the provisions of, the Trust Indenture Act and this Indenture. SECTION 7.09. There shall at all times be a Trustee with respect to the Debentures issued hereunder which shall at all times be a corporation organized and doing business under the laws of 26 the United States of America or any State or Territory thereof or of the District of Columbia, or a corporation or other person permitted to act as trustee by the Commission, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at least 50 million dollars, and subject to supervision or examination by Federal, State, Territorial, or District of Columbia authority. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of the aforesaid supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. The Company may not, nor may any person directly or indirectly controlling, controlled by, or under common control with the Company, serve as Trustee. In case at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section, the Trustee shall resign immediately in the manner and with the effect specified in Section 7.10. SECTION 7.10. (a) The Trustee or any successor hereafter appointed, may at any time resign with respect to the Debentures of one or more series by giving written notice thereof to the Company and by transmitting notice of resignation by mail, first class postage prepaid, to the Debentureholders of such series, as their names and addresses appear upon the Debenture Register. Upon receiving such notice of resignation, the Company shall promptly appoint a successor trustee with respect to Debentures of such series by written instrument, in duplicate, executed by order of the Board of Directors, one copy of which instrument shall be delivered to the resigning Trustee and one copy to the successor trustee. If no successor trustee shall have been so appointed and have accepted appointment within 30 days after the mailing of such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for the appointment of a successor trustee with respect to Debentures of such series, or any Debentureholder of that series who has been a bona fide holder of a Debenture or Debentures for at least six months may, subject to the provisions of Section 6.08, on behalf of himself and all others similarly situated, petition any such court for the appointment of a successor trustee. Such court may thereupon after such notice, if any, as it may deem proper and prescribe, appoint a successor trustee. (b) In case at any time any of the following shall occur: (1) the Trustee shall fail to comply with the provisions of subsection (a) of Section 7.08 after written request therefor by the Company or by any Debentureholder who has been a bona fide holder of a Debenture or Debentures for at least six months; or (2) the Trustee shall cease to be eligible in accordance with the provisions of Section 7.09 and shall fail to resign after written request therefor by the Company or by any such Debentureholder; or (3) the Trustee shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its property shall be appointed, or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, then, in any such case, the Company may remove the Trustee with respect to all Debentures and appoint a successor trustee by written instrument, in duplicate, executed by order of the Board of Directors, one copy of which instrument shall be delivered to the Trustee so removed and one copy to the successor trustee, or, subject to the provisions of Section 6.08, unless the Trustee's duty to resign is stayed as provided herein, any Debentureholder who has been a bona fide holder of a Debenture or Debentures for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor trustee. Such court may thereupon after such notice, if any, as it may deem proper and prescribe, remove the Trustee and appoint a successor trustee. (c) The holders of a majority in aggregate principal amount of the Debentures of any series at the time outstanding may at any time remove the Trustee with respect to such series and appoint a successor trustee. 27 (d) Any resignation or removal of the Trustee and appointment of a successor trustee with respect to the Debentures of a series pursuant to any of the provisions of this Section shall become effective upon acceptance of appointment by the successor trustee as provided in Section 7.11. (e) Any successor trustee appointed pursuant to this Section may be appointed with respect to the Debentures of one or more series or all of such series, and at any time there shall be only one Trustee with respect to the Debentures of any particular series. SECTION 7.11. (a) In case of the appointment hereunder of a successor trustee with respect to all Debentures, every such successor trustee so appointed shall execute, acknowledge and deliver to the Company and to the retiring Trustee an instrument accepting such appointment, and thereupon the resignation or removal of the retiring Trustee shall become effective and such successor trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee; but, on the request of the Company or the successor trustee, such retiring Trustee shall, upon payment of its charges, execute and deliver an instrument transferring to such successor trustee all the rights, powers, and trusts of the retiring Trustee and shall duly assign, transfer and deliver to such successor trustee all property and money held by such retiring Trustee hereunder, subject to any prior lien provided for in Section 7.06(b). (b) In case of the appointment hereunder of a successor trustee with respect to the Debentures of one or more (but not all) series, the Company, the retiring Trustee and each successor trustee with respect to the Debentures of one or more series shall execute and deliver an indenture supplemental hereto wherein each successor trustee shall accept such appointment and which (1) shall contain such provisions as shall be necessary or desirable to transfer and confirm to, and to vest in, each successor trustee all the rights, powers, trusts and duties of the retiring Trustee with respect to the Debentures of that or those series to which the appointment of such successor trustee relates, (2) shall contain such provisions as shall be deemed necessary or desirable to confirm that all the rights, powers, trusts and duties of the retiring Trustee with respect to the Debentures of that or those series as to which the retiring Trustee is not retiring shall continue to be vested in the retiring Trustee, and (3) shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such Trustees co-trustees of the same trust, that each such Trustee shall be trustee of a trust or trusts hereunder separate and apart from any trust or trusts hereunder administered by any other such Trustee and that no Trustee shall be responsible for any act or failure to act on the part of any other Trustee hereunder; and upon the execution and delivery of such supplemental indenture the resignation or removal of the retiring Trustee shall become effective to the extent provided therein, such retiring Trustee shall with respect to the Debentures of that or those series to which the appointment of such successor trustee relates have no further responsibility for the exercise of rights and powers or for the performance of the duties and obligations vested in the Trustee under this Indenture, and each such successor trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee with respect to the Debentures of that or those series to which the appointment of such successor trustee relates; but, on request of the Company or any successor trustee, such retiring Trustee shall duly assign, transfer and deliver to such successor trustee, to the extent contemplated by such supplemental indenture, the property and money held by such retiring Trustee hereunder with respect to the Debentures of that or those series to which the appointment of such successor trustee relates. (c) Upon request of any such successor trustee or retiring Trustee, the Company shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor trustee all such rights, powers and trusts referred to in paragraph (a) or (b) of this Section, as the case may be. (d) No successor trustee shall accept its appointment unless at the time of such acceptance such successor trustee shall be qualified and eligible under this Article. 28 (e) Upon acceptance of appointment by a successor trustee as provided in this Section, the Company shall transmit notice of the succession of such trustee hereunder by mail, first class postage prepaid, to the Debentureholders, as their names and addresses appear upon the Debenture Register. If the Company fails to transmit such notice within ten days after acceptance of appointment by the successor trustee, the successor trustee shall cause such notice to be transmitted at the expense of the Company. SECTION 7.12. Any corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation succeeding to the corporate trust business of the Trustee, shall be the successor of the Trustee hereunder, provided such corporation shall be qualified under the provisions of Section 7.08 and eligible under the provisions of Section 7.09, without the execution or filing of any paper or any further act on the part of any of the parties hereto, anything herein to the contrary notwithstanding. In case any Debentures shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion or consolidation to such authenticating Trustee may adopt such authentication and deliver the Debentures so authenticated with the same effect as if such successor Trustee had itself authenticated such Debentures. SECTION 7.13. If and when the Trustee shall become a creditor of the Company (or any other obligor upon the Debentures), the Trustee shall be subject to the provisions of the Trust Indenture Act regarding the collection of claims against the Company (or any other obligor upon the Debentures). ARTICLE EIGHT Concerning the Debentureholders SECTION 8.01. Whenever in this Indenture it is provided that the holders of a majority or specified percentage in aggregate principal amount of the Debentures of a particular series may take any action (including the making any demand or request, the giving of any notice, consent or waiver or the taking of any other action), the fact that at the time of taking any such action the holders of such majority or specified percentage of that series have joined therein may be evidenced by any instrument or any number of instruments of similar tenor executed by such holders of Debentures of that series in person or by agent or proxy appointed in writing. If the Company shall solicit from the Debentureholders of any series any request, demand, authorization, direction, notice, consent, waiver or other action, the Company may, at its option, as evidenced by an Officers' Certificate, fix in advance a record date for such series for the determination of Debentureholders entitled to give such request, demand, authorization, direction, notice, consent, waiver or other action, but the Company shall have no obligation to do so. If such a record date is fixed, such request, demand, authorization, direction, notice, consent, waiver or other action may be given before or after the record date, but only the Debentureholders of record at the close of business on the record date shall be deemed to be Debentureholders for the purposes of determining whether Debentureholders of the requisite proportion of outstanding Debentures of that series have authorized or agreed or consented to such request, demand, authorization, direction, notice, consent, waiver or other action, and for that purpose the outstanding Debentures of that series shall be computed as of the record date; provided that no such authorization, agreement or consent by such Debentureholders on the record date shall be deemed effective unless it shall become effective pursuant to the provisions of this Indenture not later than six months after the record date. SECTION 8.02. Subject to the provisions of Section 7.01, proof of the execution of any instrument by a Debentureholder (such proof will not require notarization) or his agent or proxy and proof of the holding by any person of any of the Debentures shall be sufficient if made in the following manner: (a) The fact and date of the execution by any such person of any instrument may be proved in any reasonable manner acceptable to the Trustee. 29 (b) The ownership of Debentures shall be proved by the Debenture Register of such Debentures or by a certificate of the Debenture Registrar thereof. (c) The Trustee may require such additional proof of any matter referred to in this Section as it shall deem necessary. SECTION 8.03. Prior to the due presentment for registration of transfer of any Debenture, the Company, the Trustee, any paying agent and any Debenture Registrar may deem and treat the person in whose name such Debenture shall be registered upon the books of the Company as the absolute owner of such Debenture (whether or not such Debenture shall be overdue and notwithstanding any notice of ownership or writing thereon made by anyone other than the Debenture Registrar) for the purpose of receiving payment of or on account of the principal of and premium, if any, and (subject to Section 2.03) interest on such Debenture and for all other purposes; and neither the Company nor the Trustee nor any paying agent nor any Debenture Registrar shall be affected by any notice to the contrary. SECTION 8.04. At any time the Debentures are held by any holder other than PacifiCorp Delaware, L.P., a Delaware limited partnership, in determining whether the holders of the requisite aggregate principal amount of Debentures of a particular series have concurred in any direction, consent or waiver under this Indenture, Debentures of that series which are owned by the Company or any other obligor on the Debentures of that series or by any person directly or indirectly controlling or controlled by or under common control with the Company or any other obligor on the Debentures of that series shall be disregarded and deemed not to be outstanding for the purpose of any such determination, except that for the purpose of determining whether the Trustee shall be protected in relying on any such direction, consent or waiver, only Debentures of such series which the Trustee actually knows are so owned shall be so disregarded. Debentures so owned which have been pledged in good faith may be regarded as outstanding for the purposes of this Section, if the pledgee shall establish to the satisfaction of the Trustee the pledgee's right so to act with respect to such Debentures and that the pledgee is not a person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company or any such other obligor. In case of a dispute as to such right, any decision by the Trustee taken upon the advice of counsel shall be full protection to the Trustee. SECTION 8.05. At any time prior to (but not after) the evidencing to the Trustee, as provided in Section 8.01, of the taking of any action by the holders of the majority or percentage in aggregate principal amount of the Debentures of a particular series specified in this Indenture in connection with such action, any holder of a Debenture of that series which is shown by the evidence to be included in the Debentures the holders of which have consented to such action may, by filing written notice with the Trustee, and upon proof of holding as provided in Section 8.02, revoke such action so far as concerns such Debenture. Except as aforesaid, any such action taken by the holder of any Debenture shall be conclusive and binding upon such holder and upon all future holders and owners of such Debenture, and of any Debenture issued in exchange therefor, on registration of transfer thereof or in place thereof, irrespective of whether or not any notation in regard thereto is made upon such Debenture. Any action taken by the holders of the majority or percentage in aggregate principal amount of the Debentures of a particular series specified in this Indenture in connection with such action shall be conclusively binding upon the Company, the Trustee and the holders of all the Debentures of that series. ARTICLE NINE Supplemental Indentures SECTION 9.01. In addition to any supplemental indenture otherwise authorized by this Indenture, the Company, when authorized by a Board Resolution, and the Trustee may from time to time and at any time enter into an indenture or indentures supplemental hereto (which shall conform to the provisions of the Trust Indenture Act as then in effect), without the consent of the Debentureholders, for one or more of the following purposes: 30 (a) to evidence the succession of another corporation to the Company, and the assumption by any such successor of the covenants of the Company contained herein or otherwise established with respect to the Debentures; or (b) to add to the covenants of the Company such further covenants, restrictions, conditions or provisions for the protection of the holders of the Debentures of all or any series as the Board of Directors and the Trustee shall consider to be for the protection of the holders of Debentures of all or any series, and to make the occurrence, or the occurrence and continuance, of a default in any of such additional covenants, restrictions, conditions or provisions a default or an Event of Default with respect to such series permitting the enforcement of all or any of the several remedies provided in this Indenture as herein set forth; provided, however, that in respect of any such additional covenant, restriction, condition or provision such supplemental indenture may provide for a particular period of grace after default (which period may be shorter or longer than that allowed in the case of other defaults) or may provide for an immediate enforcement upon such default or may limit the remedies available to the Trustee upon such default or may limit the right of the holders of a majority in aggregate principal amount of the Debentures of such series to waive such default; or (c) to cure any ambiguity or to correct or supplement any provision contained herein or in any supplemental indenture which may be defective or inconsistent with any other provision contained herein or in any supplemental indenture, or to make such other provisions in regard to matters or questions arising under this indenture as shall not be inconsistent with the provisions of this Indenture and shall not adversely affect the interests of the holders of the Debentures of any series; or (d) to change or eliminate any of the provisions of this Indenture, provided that any such change or elimination shall become effective only when there is no Debenture outstanding of any series created prior to the execution of such supplemental indenture which is entitled to the benefit of such provision. The Trustee is hereby authorized to join with the Company in the execution of any such supplemental indenture, and to make any further appropriate agreements and stipulations which may be therein contained, but the Trustee shall not be obligated to enter into any such supplemental indenture which affects the Trustee's own rights, duties or immunities under this Indenture or otherwise. Any supplemental indenture authorized by the provisions of this Section may be executed by the Company and the Trustee without the consent of the holders of any of the Debentures at the time outstanding, notwithstanding any of the provisions of Section 9.02. SECTION 9.02. With the consent (evidenced as provided in Section 8.01) of the holders of not less than a majority in aggregate principal amount of the Debentures of each series affected by such supplemental indenture or indentures at the time outstanding, the Company, when authorized by a Board Resolution, and the Trustee may from time to time and at any time enter into an indenture or indentures supplemental hereto (which shall conform to the provisions of the Trust Indenture Act as then in effect) for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of any supplemental indenture or of modifying in any manner the rights of the holders of the Debentures of such series under this Indenture; provided, however, that no such supplemental indenture shall (i) extend the fixed maturity of any Debentures of any series, or reduce the principal amount thereof, or reduce the rate or extend the time of payment of interest thereon, or reduce any premium payable upon the redemption thereof, without the consent of the holder of each Debenture so affected or (ii) reduce the aforesaid percentage of Debentures, the holders of which are required to consent to any such supplemental indenture, without the consent of the holders of each Debenture then outstanding and affected thereby. 31 Upon the request of the Company, accompanied by a Board Resolution authorizing the execution of any such supplemental indenture, and upon the filing with the Trustee of evidence of the consent of Debentureholders required to consent thereto as aforesaid, the Trustee shall join with the Company in the execution of such supplemental indenture unless such supplemental indenture affects the Trustee's own rights, duties or immunities under this Indenture or otherwise, in which case the Trustee may in its discretion but shall not be obligated to enter into such supplemental indenture. It shall not be necessary for the consent of the Debentureholders of any series affected thereby under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such consent shall approve the substance thereof. Promptly after the execution by the Company and the Trustee of any supplemental indenture pursuant to the provisions of this Section, the Trustee shall transmit by mail, first class postage prepaid, a notice, setting forth in general terms the substance of such supplemental indenture, to the Debentureholders of all series affected thereby as their names and addresses appear upon the Debenture Register. Any failure of the Trustee to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture. SECTION 9.03. Upon the execution of any supplemental indenture pursuant to the provisions of this Article or of Section 10.01, this Indenture shall, with respect to such series, be and be deemed to be modified and amended in accordance therewith and the respective rights, limitations of rights, obligations, duties and immunities under this Indenture of the Trustee, the Company and the holders of Debentures of the series affected thereby shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms and conditions of any such supplemental indenture shall be and be deemed to be part of the terms and conditions of this Indenture for any and all purposes. SECTION 9.04. Debentures of any series, affected by a supplemental indenture, authenticated and delivered after the execution of such supplemental indenture pursuant to the provisions of this Article or of Section 10.01, may bear a notation in form approved by the Company, provided such form meets the requirements of any exchange upon which such series may be listed, as to any matter provided for in such supplemental indenture. If the Company shall so determine, new Debentures of that series so modified as to conform, in the opinion of the Board of Directors, to any modification of this Indenture contained in any such supplemental indenture may be prepared by the Company, authenticated by the Trustee and delivered in exchange for the Debentures of that series then outstanding. SECTION 9.05. The Trustee, subject to the provisions of Section 7.01, is entitled to receive an Opinion of Counsel as conclusive evidence that any supplemental indenture executed pursuant to this Article is authorized or permitted by, and conforms to, the terms of this Article and that it is proper for the Trustee under the provisions of this Article to join in the execution thereof. ARTICLE TEN Consolidation, Merger and Sale SECTION 10.01. Nothing contained in this Indenture or in any of the Debentures shall prevent any consolidation or merger of the Company with or into any other corporation or corporations (whether or not affiliated with the Company), or successive consolidations or mergers in which the Company or its successor or successors shall be a party or parties, or shall prevent any sale, conveyance, transfer or other disposition of the property of the Company or its successor or successors as an entirety, or substantially as an entirety, to any other corporation (whether or not affiliated with the Company or its successor or successors) authorized to acquire and operate the same; provided, however, the Company hereby covenants and agrees that, upon any such consolidation, merger, sale, conveyance, transfer or other disposition, the due and punctual payment of the principal of (premium, if any) and interest on all of the Debentures of all series in accordance with the terms of each series, according to their tenor, and the due and punctual performance and 32 observance of all the covenants and conditions of this Indenture with respect to each series or established with respect to such series pursuant to Section 2.01 to be kept or performed by the Company, shall be expressly assumed, by supplemental indenture (which shall conform to the provisions of the Trust Indenture Act as then in effect) satisfactory in form to the Trustee executed and delivered to the Trustee by the entity formed by such consolidation, or into which the Company shall have been merged, or by the entity which shall have acquired such property. SECTION 10.02. (a) In case of any such consolidation, merger, sale, conveyance, transfer or other disposition and upon the assumption by the successor corporation, by supplemental indenture, executed and delivered to the Trustee and satisfactory in form to the Trustee, of the due and punctual payment of the principal of and premium, if any, and interest on all of the Debentures of all series outstanding and the due and punctual performance of all of the covenants and conditions of this Indenture or established with respect to each series of the Debentures pursuant to Section 2.01 to be performed by the Company with respect to each series, such successor corporation shall succeed to and be substituted for the Company, with the same effect as if it had been named herein as the party of the first part, and thereupon the predecessor corporation shall be relieved of all obligations and covenants under this Indenture and the Debentures, except the provisions of Section 7.06 to the extent such provisions relate to matters occurring before any such consolidation, merger, sale, conveyance, transfer or other disposition. Such successor corporation thereupon may cause to be signed, and may issue either in its own name or in the name of the Company or any other predecessor obligor on the Debentures, any or all of the Debentures issuable hereunder which theretofore shall not have been signed by the Company and delivered to the Trustee; and, upon the order of such successor company, instead of the Company, and subject to all the terms, conditions and limitations in this Indenture prescribed, the Trustee shall authenticate and shall deliver any Debentures which previously shall have been signed and delivered by the officers of the predecessor Company to the Trustee for authentication, and any Debentures which such successor corporation thereafter shall cause to be signed and delivered to the Trustee for that purpose. All the Debentures so issued shall in all respects have the same legal rank and benefit under this Indenture as the Debentures theretofore or thereafter issued in accordance with the terms of this Indenture as though all of such Debentures had been issued at the date of the execution hereof. (b) In case of any such consolidation, merger, sale, conveyance, transfer or other disposition such changes in phraseology and form (but not in substance) may be made in the Debentures thereafter to be issued as may be appropriate. (c) Nothing contained in this Indenture or in any of the Debentures shall prevent the Company from merging into itself or acquiring by purchase or otherwise all or any part of the property of any other corporation (whether or not affiliated with the Company). SECTION 10.03. The Trustee, subject to the provisions of Section 7.01, is entitled to receive an Opinion of Counsel as conclusive evidence that any such consolidation, merger, sale, conveyance, transfer or other disposition, and any such assumption, comply with the provisions of this Article. ARTICLE ELEVEN Satisfaction and Discharge of Indenture; Unclaimed Moneys SECTION 11.01. If at any time: (a) the Company shall have delivered to the Trustee for cancellation all Debentures of a series theretofore authenticated (other than any Debentures which shall have been destroyed, lost or stolen and which shall have been replaced or paid as provided in Section 2.07) and Debentures for whose payment money or Governmental Obligations has theretofore been deposited in trust or segregated and held in trust by the Company (and thereupon repaid to the Company or discharged from such trust, as provided in Section 11.06); (b) all such Debentures of a particular series not theretofore delivered to the Trustee for cancellation shall have become due and payable, or are by their terms to become due and payable within one year or are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice 33 of redemption, and the Company shall deposit or cause to be deposited with the Trustee as trust funds the entire amount in moneys or Governmental Obligations sufficient; or (c) a combination thereof, sufficient in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, to pay at maturity or upon redemption all Debentures of that series not theretofore delivered to the Trustee for cancellation, including principal (and premium, if any) and interest due or to become due to such date of maturity or date fixed for redemption, as the case may be, and if the Company shall also pay or cause to be paid all other sums payable hereunder with respect to such series by the Company, then this Indenture shall thereupon cease to be of further effect with respect to such series except for the provisions of Sections 2.05, 2.07, 4.02 and 7.10, which shall survive until the date of maturity or redemption date, as the case may be, and Sections 7.06 and 11.06 which shall survive to such date and thereafter, and the Trustee, on demand of the Company and at the cost and expense of the Company, shall execute proper instruments acknowledging satisfaction of and discharging this Indenture with respect to such series. SECTION 11.02. If at any time all such Debentures of a particular series not heretofore delivered to the Trustee for cancellation or which have not become due and payable as described in Section 11.01 shall have been paid by the Company by depositing irrevocably with the Trustee as trust funds moneys or an amount of Governmental Obligations sufficient to pay at maturity or upon redemption all such Debentures of that series not theretofore delivered to the Trustee for cancellation, including principal (and premium, if any) and interest due or to become due to such date of maturity or date fixed for redemption, as the case may be, and if the Company shall also pay or cause to be paid all other sums payable hereunder by the Company with respect to such series, then after the date such moneys or Governmental Obligations, as the case may be, are deposited with the Trustee the obligations of the Company under this Indenture with respect to such series shall cease to be of further effect except for the provisions of Sections 2.05, 2.07, 4.02, 7.06, 7.10 and 11.06 hereof which shall survive until such Debentures shall mature and be paid. Thereafter, sections 7.06 and 11.05 shall survive. The release of the Company from its obligations under this Indenture, as provided for in this Section 11.02, shall be subject to the further condition that the Company first shall have caused to be delivered to the Trustee an Opinion of Counsel to the effect that Debentureholders of a series with respect to which a deposit has been made in accordance with this Section 11.02 will not realize income, gain or loss for federal income tax purposes as a result of such deposit and release, and will be subject to federal income tax on the same amount, in the same manner, and at the same times as would have been the case if such deposit and release had not occurred. SECTION 11.03. If, in addition to satisfying the conditions set forth in Section 11.01 or 11.02 (except for the requirement of an Opinion of Counsel), the Company delivers to the Trustee an Opinion of Counsel to the effect that (a) the Company has received from, or there has been published by, the Internal Revenue Service a ruling, or (b) since the date of this Indenture there has been a change in applicable federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, the Debentureholders of a series with respect to which a deposit has been made in accordance with Section 11.01 or 11.02 will not realize income, gain or loss for federal income tax purposes as a result of such deposit, defeasance and discharge and will 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 such deposit, defeasance and discharge had not occurred, and (c) the deposit shall not result in the Company, the Trustee or the trust being deemed an "investment company" under the Investment Company Act of 1940, as amended, then, in such event, the Company will be deemed to have paid and discharged the entire indebtedness on such series and the holder thereof shall thereafter be entitled to receive payment solely from the trust fund described above. SECTION 11.04. All moneys or Governmental Obligations deposited with the Trustee pursuant to Sections 11.01 or 11.02 shall be held in trust and shall be available for payment as due, either directly or through any paying agent (including the Company acting as its own paying agent), to the holders of the particular series of Debentures for the payment or redemption of which such moneys or Governmental Obligations have been deposited with the Trustee. 34 SECTION 11.05. In connection with the satisfaction and discharge of this Indenture all moneys or Governmental Obligations then held by any paying agent under the provisions of this Indenture shall, upon demand of the Company, be paid to the Trustee and thereupon such paying agent shall be released from all further liability with respect to such moneys or Governmental Obligations. SECTION 11.06. Any moneys or Governmental Obligations deposited with any paying agent or the Trustee, or then held by the Company, in trust for payment of principal of or premium or interest on the Debentures of a particular series that are not applied but remain unclaimed by the holders of such Debentures for at least two years after the date upon which the principal of (and premium, if any) or interest on such Debentures shall have respectively become due and payable, shall, upon written notice from the Company, be repaid to the Company on May 31 of each year or (if then held by the Company) shall be discharged from such trust; and thereupon the paying agent and the Trustee shall be released from all further liability with respect to such moneys or Governmental Obligations, and the holder of any of the Debentures entitled to receive such payment shall thereafter, as an unsecured general creditor, look only to the Company for the payment thereof. ARTICLE TWELVE Immunity of Incorporators, Stockholders, Officers and Directors SECTION 12.01. No recourse under or upon any obligation, covenant or agreement of this Indenture, or of any Debenture, or for any claim based thereon or otherwise in respect thereof, shall be had against any incorporator, stockholder, officer or director, past, present or future as such, of the Company or of any predecessor or successor corporation, either directly or through the Company or any such predecessor or successor corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise; it being expressly understood that this Indenture and the obligations issued hereunder are solely corporate obligations, and that no such personal liability whatever shall attach to, or is or shall be incurred by, the incorporators, stockholders, officers or directors as such, of the Company or of any predecessor or successor corporation, or any of them, because of the creation of the indebtedness hereby authorized, or under or by reason of the obligations, covenants or agreements contained in this Indenture or in any of the Debentures or implied therefrom; and that any and all such personal liability of every name and nature, either at common law or in equity or by constitution or statute, of, and any and all such rights and claims against, every such incorporator, stockholder, officer or director as such, because of the creation of the indebtedness hereby authorized, or under or by reason of the obligations, covenants or agreements contained in this Indenture or in any of the Debentures or implied therefrom, are hereby expressly waived and released as a condition of, and as a consideration for, the execution of this Indenture and the issuance of such Debentures. ARTICLE THIRTEEN Miscellaneous Provisions SECTION 13.01. All the covenants, stipulations, promises and agreements in this Indenture contained by or on behalf of the Company shall bind its successors and assigns, whether so expressed or not. SECTION 13.02. Any act or proceeding by any provision of this Indenture authorized or required to be done or performed by any board, committee or officer of the Company shall and may be done and performed with like force and effect by the corresponding board, committee or officer of any corporation that shall at the time be the lawful sole successor of the Company. SECTION 13.03. Except as otherwise expressly provided herein, any notice or demand which by any provision of this Indenture is required or permitted to be given or served by the Trustee or by the holders of Debentures to or on the Company may be given or served by being deposited first class postage prepaid in a post-office letter box addressed (until another address is filed 35 in writing by the Company with the Trustee), as follows: PacifiCorp, 700 NE Multnomah, Suite 1600, Attention: Richard T. O'Brien. Any notice, election, request or demand by the Company or any Debentureholder to or upon the Trustee shall be deemed to have been sufficiently given or made, for all purposes, if given or made in writing at the Corporate Trust Office of the Trustee. SECTION 13.04. This Indenture and each Debenture shall be deemed to be a contract made under the laws of the State of New York, and for all purposes shall be construed in accordance with the laws of said State, without regard to the conflicts of laws principles thereof. SECTION 13.05. (a) Upon any application or demand by the Company to the Trustee to take any action under any of the provisions of this Indenture, the Company shall furnish to the Trustee an Officers' Certificate stating that all conditions precedent provided for in this Indenture relating to the proposed action have been complied with and an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent have been complied with, except that in the case of any such application or demand as to which the furnishing of such documents is specifically required by any provision of this Indenture relating to such particular application or demand, no additional certificate or opinion need be furnished. (b) Each certificate or opinion provided for in this Indenture and delivered to the Trustee with respect to compliance with a condition or covenant in this Indenture (other than the certificate provided pursuant to Section 5.03(d) of this Indenture) shall include (1) a statement that the person making such certificate or opinion has read such covenant or condition; (2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; (3) a statement that, in the opinion of such person, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and (4) a statement as to whether or not, in the opinion of such person, such condition or covenant has been complied with. SECTION 13.06. Simultaneously with the execution of this Indenture, the Company shall deliver to the Trustee an Opinion of Counsel stating that, in the opinion of such counsel (a) this Indenture has been duly authorized by and lawfully executed and delivered on behalf of the Company, is in full force and effect and is legal, valid and binding upon the Company in accordance with its terms, except to the extent limited by bankruptcy, insolvency, reorganization or other laws affecting creditors' rights and (b) the Debentures have been authorized, executed and delivered by the Company and constitute legal, valid and binding obligations of the Company in accordance with their terms. SECTION 13.07. Except as provided pursuant to Section 2.01 pursuant to a Board Resolution, and as set forth in an Officers' Certificate, or established in one or more indentures supplemental to this Indenture, in any case where the date of maturity of interest or principal of any Debenture or the date of redemption of any Debenture shall not be a business day then payment of interest or principal (and premium, if any) may be made on the next succeeding business day with the same force and effect as if made on the nominal date of maturity or redemption, and no interest shall accrue for the period after such nominal date. SECTION 13.08. If and to the extent that any provision of this Indenture limits, qualifies or conflicts with the duties imposed by operation of Section 3.18(c) of the Trust Indenture Act, such imposed duties shall control. SECTION 13.09. This Indenture may be executed in any number of counterparts, each of which shall be an original; but such counterparts shall together constitute but one and the same instrument. SECTION 13.10. In case any one or more of the provisions contained in this Indenture or in the Debentures of any series shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of 36 this Indenture or of such Debentures, but this Indenture and such Debentures shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein or therein. SECTION 13.11. The Company will have the right at all times to assign any of its rights or obligations under this Indenture to a direct or indirect wholly owned subsidiary of the Company; provided that, in the event of any such assignment, the Company will remain liable for all such obligations. Subject to the foregoing, the Indenture is binding upon and inures to the benefit of the parties thereto and their respective successors and assigns. The Indenture may not otherwise be assigned by the parties thereto. ARTICLE FOURTEEN Subordination of Debentures SECTION 14.01. The Company covenants and agrees, and each holder of Debentures issued hereunder by his acceptance thereof likewise covenants and agrees, that all Debentures shall be issued subject to the provisions of this Article Fourteen; and each holder of a Debenture, whether upon original issue or upon transfer or assignment thereof, accepts and agrees to be bound by such provisions. The payment of the principal of and premium, if any, and interest on all Debentures issued hereunder shall, to the extent and in the manner hereinafter set forth, be subordinated and subject in right of payment to the prior payment in full of all Senior Indebtedness, whether outstanding at the date of this Indenture or thereafter incurred. No provision of this Article Fourteen shall prevent the occurrence of any default or Event of Default hereunder. SECTION 14.02. In the event and during the continuation of any default in the payment of principal, premium, interest or any payment due on any Senior Indebtedness continuing beyond the period of grace, if any, specified in the instrument evidencing such Senior Indebtedness (and the Trustee has received written notice thereof from the Company or one or more holders of Senior Indebtedness or their representative or representatives or a trustee), unless and until such default shall have been cured or waived or shall have ceased to exist, and in the event that the maturity of any Senior Indebtedness has been accelerated because of a default (and the Trustee has received written notice thereof from the Company or one or more holders of Senior Indebtedness or their representative or representatives or a trustee), then no payment shall be made by the Company with respect to the principal (including redemption and sinking fund payments) of or premium, if any, or interest on the Debentures. In the event that, notwithstanding the foregoing, any payment shall be received by the Trustee or any holder when such payment is prohibited by the preceding paragraph of this Section 14.02, such payment shall be held in trust for the benefit of, and shall be paid over or delivered to, the holders of Senior Indebtedness or their respective representatives, or to the trustee or trustees under any indenture pursuant to which any of such Senior Indebtedness may have been issued, as their respective interests may appear, but only to the extent that the holders of the Senior Indebtedness (or their representative or representatives or a trustee) notify the Trustee within 90 days of such payment of the amounts then due and owing on the Senior Indebtedness and only the amounts specified in such notice to the Trustee shall be paid to the holders of Senior Indebtedness. SECTION 14.03. Upon any payment by the Company, or distribution of assets of the Company of any kind or character, whether in cash, property or securities, to creditors upon any dissolution or winding-up or liquidation or reorganization of the Company, whether voluntary or involuntary or in bankruptcy, insolvency, receivership or other proceedings, all amounts due or to become due upon all Senior Indebtedness shall first be paid in full, or payment thereof provided for in money in accordance with its terms, before any payment is made on account of the principal (and premium, if any) or interest on the Debentures; and upon any such dissolution or winding-up or liquidation or reorganization, any payment by the Company, or distribution of assets of the Company 37 of any kind or character, whether in cash, property or securities, to which the holders of the Debentures or the Trustee would be entitled, except for the provisions of this Article Fourteen, shall be paid by the Company or by any receiver, trustee in bankruptcy, liquidating trustee, agent or other person making such payment or distribution, or by the holders of the Debentures or by the Trustee under this Indenture if received by them or it directly to the holders of Senior Indebtedness (pro rata to such holders on the basis of the respective amounts of Senior Indebtedness held by such holders, as calculated by the Company) or their representative or representatives, or to the trustee or trustees under any indenture pursuant to which any instruments evidencing any Senior Indebtedness may have been issued, as their respective interests may appear, to the extent necessary to pay all Senior Indebtedness in full, in money or money's worth, after giving effect to any concurrent payment or distribution to or for the holders of Senior Indebtedness, before any payment or distribution is made to the holders of Debentures or to the Trustee. In the event that, notwithstanding the foregoing, any payment or distribution of assets of the Company of any kind or character, whether in cash, property or securities, prohibited by the foregoing, shall be received by the Trustee or the holders of the Debentures before all Senior Indebtedness is paid in full, or provision is made for such payment in money in accordance with its terms, such payment or distribution shall be held in trust for the benefit of and shall be paid over or delivered to the holders of Senior Indebtedness or their representative or representatives, or to the trustee or trustees under any indenture pursuant to which any instruments evidencing any Senior Indebtedness may have been issued, as their respective interests may appear, as calculated by the Company, for application to the payment of Senior Indebtedness remaining unpaid to the extent necessary to pay all Senior Indebtedness in full in money in accordance with its terms, after giving effect to any concurrent payment or distribution to or for the holders of such Senior Indebtedness. For purposes of this Article Fourteen, the words, "cash, property or securities" shall not be deemed to include shares of stock of the Company as reorganized or readjusted, or securities of the Company or any other corporation provided for by a plan of reorganization or readjustment, the payment of which is subordinated at least to the extent provided in this Article Fourteen with respect to the Debentures to the payment of all Senior Indebtedness which may at the time be outstanding; provided that (i) the Senior Indebtedness is assumed by the new corporation, if any, resulting from any such reorganization or readjustment, and (ii) the rights of the holders of the Senior Indebtedness are not, without the consent of such holders, altered by such reorganization or readjustment. The consolidation of the Company with, or the merger of the Company into, another corporation or the liquidation or dissolution of the Company following the conveyance or transfer of its property as an entirety, or substantially as an entirety, to another corporation upon the terms and conditions provided for in Article Ten hereof shall not be deemed a dissolution, winding-up, liquidation or reorganization for the purposes of this Section 14.03 if such other corporation shall, as a part of such consolidation, merger, conveyance or transfer, comply with the conditions stated in Article Ten hereof. Nothing in Section 14.02 or in this Section 14.03 shall apply to claims of, or payments to, the Trustee under or pursuant to Section 7.06. SECTION 14.04. Subject to the payment in full of all Senior Indebtedness, the rights of the holders of the Debentures shall be subrogated to the rights of the holders of Senior Indebtedness to receive payments or distributions of cash, property or securities of the Company applicable to the Senior Indebtedness until the principal of (and premium, if any) and interest on the Debentures shall be paid in full; and, for the purposes of such subrogation, no payments or distributions to the holders of the Senior Indebtedness of any cash, property or securities to which the holders of the Debentures or the Trustee would be entitled except for the provisions of this Article Fourteen, and no payment over pursuant to the provisions of this Article Fourteen, to or for the benefit of the holders of Senior Indebtedness by holders of the Debentures or the Trustee, shall, as between the Company, its creditors other than holders of Senior Indebtedness, and the holders of the Debentures, be deemed to be a payment by the Company to or on account of the Senior Indebtedness. It is understood that the provisions of this Article Fourteen are and are intended solely for the purposes of defining the relative rights of the holders of the Debentures, on the one hand, and the holders of the Senior Indebtedness on the other hand. 38 Nothing contained in this Article Fourteen or elsewhere in this Indenture or in the Debentures is intended to or shall impair, as between the Company, its creditors other than the holders of Senior Indebtedness, and the holders of the Debentures, the obligation of the Company, which is absolute and unconditional, to pay to the holders of the Debentures the principal of (and premium, if any) and interest on the Debentures as and when the same shall become due and payable in accordance with their terms, or is intended to or shall affect the relative rights of the holders of the Debentures and creditors of the Company other than the holders of the Senior Indebtedness, nor shall anything herein or therein prevent the Trustee or the holder of any Debenture from exercising all remedies otherwise permitted by applicable law upon default under this Indenture, subject to the rights, if any, under this Article Fourteen of the holders of Senior Indebtedness in respect of cash, property or securities of the Company received upon the exercise of any such remedy. Upon any payment or distribution of assets of the Company referred to in this Article Fourteen, the Trustee, subject to the provision of Section 7.01, and the holders of the Debentures shall be entitled to rely upon any order or decree made by any court of competent jurisdiction in which such dissolution, winding-up, liquidation or reorganization proceedings are pending, or a certificate of the receiver, trustee in bankruptcy, liquidation trustee, agent or other person making such payment or distribution, delivered to the Trustee or to the holders of the Debentures, for the purposes of ascertaining the persons entitled to participate in such distribution, the holders of the Senior Indebtedness and other indebtedness of the Company, the amount hereof or payable thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Article Fourteen. SECTION 14.05. Each holder of a Debenture by his acceptance thereof authorizes and directs the Trustee in his behalf to take such action as may be necessary or appropriate to effectuate the subordination provided in this Article Fourteen and appoints the Trustee his attorney-in-fact for any and all such purposes. SECTION 14.06. The Company shall give prompt written notice to a Responsible Officer of the Trustee of any fact known to the Company which would prohibit the making of any payment of monies to or by the Trustee or paying agent in respect of the Debentures pursuant to the provisions of this Article Fourteen. Notwithstanding the provisions of this Article Fourteen or any other provision of this Indenture, the Trustee shall not be charged with knowledge of the existence of any facts which would prohibit the making of any payment of monies to or by the Trustee or paying agent in respect of the Debentures pursuant to the provisions of this Article Fourteen, unless and until a Responsible Officer of the Trustee shall have received written notice thereof at the Corporate Trust Office of the Trustee from the Company or a holder or holders of Senior Indebtedness or from any trustee therefor; and before the receipt of any such written notice, the Trustee, subject to the provisions of Section 7.01, shall be entitled in all respects to assume that no such facts exist; provided that if the Trustee shall not have received the notice provided for in this Section 14.06 at least two business days prior to the date upon which by the terms hereof any money may become payable for any purpose (including, without limitation, the payment of the principal of (or premium, if any) or interest on any Debenture), then, anything herein contained to the contrary notwithstanding, the Trustee shall have full power and authority to receive such money and to apply the same to the purposes for which they were received, and shall not be affected by any notice to the contrary which may be received by it within two business days prior to such date. The Trustee, subject to the provisions of Section 7.01, shall be entitled to rely on the delivery to it of a written notice by a person representing himself to be a holder of Senior Indebtedness (or a trustee on behalf of such holder) to establish that such notice has been given by a holder of Senior Indebtedness or a trustee on behalf of any such holder or holders. In the event that the Trustee determines in good faith that further evidence is required with respect to the right of any person as a holder of Senior Indebtedness to participate in any payment or distribution pursuant to this Article Fourteen, the Trustee may request such person to furnish evidence to the reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness held by such person, the extent to which such person is entitled to participate in such payment or distribution and any other facts pertinent to the rights of such person under this Article Fourteen, and if such evidence is not furnished the Trustee 39 may defer any payment to such person pending judicial determination as to the right of such person to receive such payment. SECTION 14.07. The Trustee in its individual capacity shall be entitled to all the rights set forth in this Article Fourteen in respect of any Senior Indebtedness at any time held by it, to the same extent as any other holder of Senior Indebtedness, and nothing in this Indenture shall deprive the Trustee of any of its rights as such holder. With respect to the holders of Senior Indebtedness, the Trustee undertakes to perform or to observe only such of its covenants and obligations as are specifically set forth in this Article Fourteen, and no implied covenants or obligations with respect to the holders of Senior Indebtedness shall be read into this Indenture against the Trustee. The Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior Indebtedness and, subject to the provisions of Section 7.01, the Trustee shall not be liable to any holder of Senior Indebtedness if it shall pay over or deliver to holders of Debentures, the Company or any other person money or assets to which any holder of Senior Indebtedness shall be entitled by virtue of this Article Fourteen or otherwise. SECTION 14.08. No right of any present or future holder of any Senior Indebtedness to enforce subordination as herein provided shall at any time in any way be prejudiced or impaired by any act or failure to act on the part of the Company or by any act or failure to act, in good faith, by any such holder, or by any noncompliance by the Company with the terms, provisions and covenants of this Indenture, regardless of any knowledge thereof which any such holder may have or otherwise be charged with. Without in any way limiting the generality of the foregoing paragraph, the holders of Senior Indebtedness may, at any time and from time to time, without the consent of or notice to the Trustee or the holders of the Debentures, without incurring responsibility to the holders of the Debentures and without impairing or releasing the subordination provided in this Article or the obligations hereunder of the holders of the Debentures to the holders of Senior Indebtedness, do any one or more of the following: (i) change the manner, place or terms of payment or extend the time of payment of, or renew or alter, Senior Indebtedness, or otherwise amend or supplement in any manner Senior Indebtedness or any instrument evidencing the same or any agreement under which Senior Indebtedness is outstanding; (ii) sell, exchange, release or otherwise deal with any property pledged, mortgaged or otherwise securing Senior Indebtedness; (iii) release any person liable in any manner for the collection of Senior Indebtedness; and (iv) exercise or refrain from exercising any rights against the Company and any other person. The Bank of New York, as Trustee hereby accepts the trusts in this Indenture declared and provided, upon the terms and conditions hereinabove set forth. IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, and their respective corporate seals to be hereunto affixed and attested, all as of the day and year first above written. PACIFICORP By: --------------------------------- Its: ---------------------------- Attest: By: ------------------------ Its: -------------------- 40 THE BANK OF NEW YORK as Trustee By: --------------------------------- Its: ---------------------------- Attest: By: ------------------------ Its: -------------------- STATE OF __________ ) ) ss. COUNTY OF ________ ) On ___________________, 199__ before me personally appeared ___________________ and _____________________ personally known to me or proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. Witness my hand and official seal. ______________________________________ Signature of Notary Public My Commission Expires: _______________ STATE OF __________ ) ) ss. COUNTY OF ________ ) On this day of ___________________, 199__ before me personally appeared ___________________ and ___________________ proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies) and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. Witness my hand and official seal. ______________________________________ Signature of Notary Public My Commission Expires: _______________ EX-4 5 EXHIBIT (4)(g) AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF PACIFICORP DELAWARE, L.P. TABLE OF CONTENTS Page ____ ARTICLE I FORMATION AND CONTINUATION OF THE PARTNERSHIP; ADMISSION OF PREFERRED SECURITY HOLDERS; WITHDRAWAL OF INITIAL LIMITED PARTNER Section 1.1 Formation and Continuation of the Partnership . . . . . 1 Section 1.2 Name . . . . . . . . . . . . . . . . . . . . . . . . . 1 Section 1.3 Business of the Partnership . . . . . . . . . . . . . . 2 Section 1.4 Term . . . . . . . . . . . . . . . . . . . . . . . . . 2 Section 1.5 Registered Agent and Office . . . . . . . . . . . . . . 2 Section 1.6 Principal Place of Business . . . . . . . . . . . . . . 2 Section 1.7 Name and Business Address of General Partner . . . . . 2 Section 1.8 Admission of Holders of Preferred Securities . . . . . 2 ARTICLE II DEFINED TERMS Section 2.1 Definitions . . . . . . . . . . . . . . . . . . . . . . 3 Section 2.2 Headings . . . . . . . . . . . . . . . . . . . . . . . 6 ARTICLE III CAPITAL CONTRIBUTIONS, REPRESENTATION OF PREFERRED SECURITY HOLDER'S INTEREST; CAPITAL ACCOUNTS Section 3.1 Capital Contributions . . . . . . . . . . . . . . . . . 7 Section 3.2 Preferred Security Holder's Interest Represented by Preferred Securities . . . . . . . . . . . . . . . . . 7 Section 3.3 Capital Accounts . . . . . . . . . . . . . . . . . . . 7 Section 3.4 Interest on Capital Contributions . . . . . . . . . . . 7 Section 3.5 Withdrawal and Return of Capital Contributions . . . . 7 ARTICLE IV ALLOCATIONS Section 4.1 Profits and Losses . . . . . . . . . . . . . . . . . . 7 Section 4.2 Other Allocation Provisions . . . . . . . . . . . . . . 8 Section 4.3 Allocations for Income Tax Purposes . . . . . . . . . . 10 Section 4.4 Withholding . . . . . . . . . . . . . . . . . . . . . . 10 ARTICLE V DIVIDENDS Section 5.1 Dividends . . . . . . . . . . . . . . . . . . . . . . . 10 Section 5.2 Limitations on Distributions . . . . . . . . . . . . . 10 i ARTICLE VI ISSUANCE OF PREFERRED SECURITIES Section 6.1 Aggregate Number . . . . . . . . . . . . . . . . . . . 10 Section 6.2 Powers, Preferences, Rights and Limitations . . . . . . 10 ARTICLE VII BOOKS OF ACCOUNT, RECORDS AND REPORTS Section 7.1 Books and Records . . . . . . . . . . . . . . . . . . . 13 Section 7.2 Accounting Method . . . . . . . . . . . . . . . . . . . 13 ARTICLE VIII POWERS, RIGHTS AND DUTIES OF THE LIMITED PARTNERS Section 8.1 Limitations . . . . . . . . . . . . . . . . . . . . . . 13 Section 8.2 Liability . . . . . . . . . . . . . . . . . . . . . . . 13 Section 8.3 Priority . . . . . . . . . . . . . . . . . . . . . . . 13 ARTICLE IX POWERS, RIGHTS AND DUTIES OF THE GENERAL PARTNER Section 9.1 Authority . . . . . . . . . . . . . . . . . . . . . . . 14 Section 9.2 Powers and Duties of General Partner . . . . . . . . . 14 Section 9.3 Liability . . . . . . . . . . . . . . . . . . . . . . . 15 Section 9.4 Exculpation . . . . . . . . . . . . . . . . . . . . . . 15 Section 9.5 Fiduciary Duty . . . . . . . . . . . . . . . . . . . . 15 Section 9.6 Indemnification . . . . . . . . . . . . . . . . . . . . 16 Section 9.7 Outside Businesses . . . . . . . . . . . . . . . . . . 16 Section 9.8 Limits on General Partner's Powers . . . . . . . . . . 16 Section 9.9 Tax Matters Partner . . . . . . . . . . . . . . . . . . 17 Section 9.10 Expenses . . . . . . . . . . . . . . . . . . . . . . . 17 ARTICLE X TRANSFERS OF INTERESTS BY PARTNERS Section 10.1 Transfer of Interests . . . . . . . . . . . . . . . . . 17 Section 10.2 Transfer of LP Certificates . . . . . . . . . . . . . . 18 Section 10.3 Persons Deemed Preferred Security Holders . . . . . . . 18 Section 10.4 Book Entry Interests . . . . . . . . . . . . . . . . . 18 Section 10.5 Notices to Clearing Agency . . . . . . . . . . . . . . 19 Section 10.6 Appointment of Successor Clearing Agency . . . . . . . 19 Section 10.7 Definitive LP Certificates; Appointment of Paying Agent(s) . . . . . . . . . . . . . . . . . . 19 ii ARTICLE XI WITHDRAWAL; DISSOLUTION; LIQUIDATION AND DISTRIBUTION OF ASSETS Section 11.1 Withdrawal of Partners . . . . . . . . . . . . . . . . 19 Section 11.2 Dissolution of the Partnership . . . . . . . . . . . . 20 Section 11.3 Liquidation . . . . . . . . . . . . . . . . . . . . . . 20 Section 11.4 Distribution in Liquidation . . . . . . . . . . . . . . 21 Section 11.5 Rights of Limited Partners . . . . . . . . . . . . . . 21 Section 11.6 Termination . . . . . . . . . . . . . . . . . . . . . . 21 ARTICLE XII AMENDMENTS AND MEETINGS Section 12.1 Amendments . . . . . . . . . . . . . . . . . . . . . . 21 Section 12.2 Amendment of Certificate . . . . . . . . . . . . . . . 22 Section 12.3 Meetings of the Partners . . . . . . . . . . . . . . . 22 ARTICLE XIII MISCELLANEOUS Section 13.1 Notices . . . . . . . . . . . . . . . . . . . . . . . . 23 Section 13.2 Entire Agreement . . . . . . . . . . . . . . . . . . . 23 Section 13.3 Governing Law . . . . . . . . . . . . . . . . . . . . . 23 Section 13.4 Effect . . . . . . . . . . . . . . . . . . . . . . . . 23 Section 13.5 Pronouns and Number . . . . . . . . . . . . . . . . . . 23 Section 13.6 Partial Enforceability . . . . . . . . . . . . . . . . 23 Section 13.7 Counterparts . . . . . . . . . . . . . . . . . . . . . 23 Section 13.8 Waiver of Partition . . . . . . . . . . . . . . . . . . 24 Section 13.9 Remedies . . . . . . . . . . . . . . . . . . . . . . . 24 iii AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF PACIFICORP DELAWARE, L.P. AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP of PacifiCorp Delaware, L.P. (the "Partnership"), dated as of _____________, ___________ 1994, among PacifiCorp, an Oregon corporation ("PacifiCorp"), as the __________ general partner, PacifiCorp Preferred Capital, Inc., a Delaware corporation, as the initial limited partner (the "Initial Limited _______________ Partner"), and such other Persons (as defined herein) who become Limited _______ Partners (as defined herein) as provided herein. WHEREAS, PacifiCorp and the Initial Limited Partner entered into a Limited Partnership Agreement, dated as of August 25, 1994, (the "Original Limited Partnership Agreement"); ______________________________________ WHEREAS, the Certificate of Limited Partnership of the Partnership was filed with the Office of the Secretary of State of the State of Delaware on August 26, 1994; WHEREAS, the Partners (as defined herein) desire to continue the Partnership as a limited partnership under the Act (as defined herein) and to amend and restate the Original Limited Partnership Agreement in its entirety; NOW, THEREFORE, in consideration of the agreements and obligations set forth herein and for other good and valuable consideration, receipt and sufficiency of which are hereby acknowledged, the parties hereto agree to amend and restate the Original Limited Partnership Agreement in its entirety and hereby agree as follows: ARTICLE I FORMATION AND CONTINUATION OF THE PARTNERSHIP; ADMISSION OF PREFERRED SECURITY HOLDERS; WITHDRAWAL OF INITIAL LIMITED PARTNER Section 1.1 Formation and Continuation of the Partnership. _____________________________________________ The Partnership was formed as a limited partnership under the Act by the filing by the General Partner of the Certificate (as defined herein) with the Office of the Secretary of State of the State of Delaware on August 26, 1994 and the entering into by the General Partner and the Initial Limited Partner of the Original Limited Partnership Agreement. The parties hereto agree to continue the Partnership as a limited partnership under the Act. The General Partner, for itself and as agent for the Limited Partners, shall make every reasonable effort to assure that all certificates and documents are properly executed and shall accomplish all filing, recording, publishing and other acts necessary or appropriate for compliance with all the requirements for the continuation of the Partnership as a limited partnership under the Act and under all other laws of the State of Delaware or such other jurisdictions in which the General Partner determines that the Partnership may conduct business. The rights, liabilities and duties of the Partners shall be as provided in the Act except as modified by this Agreement. Where not otherwise specified in this Agreement, the Act governs the rights and obligations of the parties to this Agreement. Section 1.2 Name. The name of the Partnership is "PacifiCorp ____ Delaware, L.P.", as such name may be modified from time to time by the General Partner following written notice to the Limited Partners. The Partnership business may be conducted under the name of the Partnership or any other name deemed advisable by the General Partner. 1 Section 1.3 Business of the Partnership. The sole purpose of ___________________________ the Partnership is (a) to issue limited partnership interests in the Partnership, including, without limitation, Preferred Securities (as defined herein), and to use the proceeds thereof to purchase Junior Subordinated Debentures (as hereinafter defined) or other similar debt instruments of PacifiCorp and (b) except as otherwise limited herein, to enter into, make and perform all contracts and other undertakings, and engage in all activities and transactions as the General Partner may reasonably deem necessary or advisable to the carrying out of the foregoing purpose of the Partnership. Section 1.4 Term. The term of the Partnership commenced on ____ the date the Certificate was filed with the Secretary of State of the State of Delaware and shall continue until December 31, 2039, subject to extension by the General Partner, in its sole discretion, until December 31, 2079, unless earlier dissolved in accordance with the provisions of this Agreement. Section 1.5 Registered Agent and Office. The Partnership's ___________________________ registered agent and office in the State of Delaware shall be The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington, New Castle County, Delaware 19801. At any time, the General Partner may designate another registered agent and/or registered office. Section 1.6 Principal Place of Business. The principal place ___________________________ of business of the Partnership shall be at c/o PacifiCorp, 700 NE Multnomah, Suite 1600, Portland, Oregon 97232. Upon ten days written notice to the Limited Partners, the General Partner may change the location of the Partnership's principal place of business. Section 1.7 Name and Business Address of General Partner. The ____________________________________________ name and address of the General Partner are as follows: PacifiCorp 700 NE Multnomah, Suite 1600 Portland, Oregon 97232 Attention: Richard T. O'Brien, Vice President The General Partner may change its name or business address from time to time, in which event the General Partner shall promptly notify the Limited Partners of any such change and shall file with the Secretary of State of the State of Delaware an appropriate amendment to the Certificate of Limited Partnership. Section 1.8 Admission of Holders of Preferred Securities. ____________________________________________ (a) Without necessity for execution of this Agreement, upon receipt by a Person of an LP Certificate (as defined herein) and payment of the Purchase Price (as defined herein) for the Preferred Securities represented by such LP Certificate in connection with the initial issuance by the Partnership of such Preferred Securities, which shall be deemed to constitute a request by such Person that the books and records of the Partnership reflect such Person's admission as a limited partner of the Partnership, such Person shall be admitted to the Partnership as a limited partner of the Partnership and shall become bound by this Agreement. (b) Following the first admission of Preferred Security Holders (as defined herein) to the Partnership as Limited Partners pursuant to paragraph (a) above, the Initial Limited Partner shall receive the return of its capital contribution without interest or deduction, but will continue to be a limited partner of the Partnership. While the Initial Limited Partner shall continue to be a limited partner of the Partnership, the Initial Limited Partner shall only have such rights, if any, as are expressly provided to the Initial Limited Partner pursuant to this Agreement. (c) The name and mailing address of each Partner and the amount contributed by such Partner to the capital of the Partnership shall be listed on the books and records of the 2 Partnership. The General Partner shall be required to update the books and records from time to time as necessary to accurately reflect the information therein. ARTICLE II DEFINED TERMS Section 2.1 Definitions. Unless the context otherwise ___________ requires, the terms defined in this Article II shall, for the purposes of this Agreement, have the meanings herein specified. "Act" means the Delaware Revised Uniform Limited Partnership ___ Act, 6 Del.C. Section 17-101, et seq., as amended from time to time. ______ _______ "Action" has the meaning set forth in Section 6.2. ______ ___________ "Affiliate" means, with respect to a specified Person, (a) any _________ Person directly or indirectly owning, controlling or holding with power to vote 10% or more of the outstanding voting securities or other ownership interests of the specified Person, (b) any Person 10% or more of whose outstanding voting securities or other ownership interests are directly or indirectly owned, controlled or held with power to vote by the specified Person, (c) any Person directly or indirectly controlling, controlled by, or under common control with the specified Person, (d) a partnership in which the specified Person is a general partner, (e) any officer or director of the specified Person, and (f) if the specified Person is an officer, director, general partner or employee, any other entity for which the specified Person acts in any such capacity. "Agreement" means this Amended and Restated Agreement of _________ Limited Partnership of the Partnership, as amended, modified, supplemented or restated from time to time. "Book Entry Interests" means a beneficial interest in the LP ____________________ Certificates, ownership and transfers of which shall be made through book entries by a Clearing Agency as described in Section 10.4. ____________ "Business Day" means any day other than a day on which banking ____________ institutions in The City of New York are authorized or required by law to close. "Capital Account" has the meaning set forth in Section 3.3. _______________ ___________ "Certificate" means the Certificate of Limited Partnership of ___________ the Partnership filed with the Secretary of State of the State of Delaware on ____________, 1994, and any and all amendments thereto and restatements thereof. "Clearing Agency" means an organization registered as a _______________ "Clearing Agency" pursuant to Section 17A of the Exchange Act that is acting as depository for the Preferred Securities and in whose name shall be registered a global LP Certificate and which shall undertake to effect book entry transfers and pledges of the Preferred Securities. "Clearing Agency Participant" means a broker, dealer, bank, ___________________________ other financial institution or other Person for whom from time to time the Clearing Agency effects book entry transfers and pledges of securities deposited with the Clearing Agency. "Code" means the Internal Revenue Code of 1986, as amended from ____ time to time, or any corresponding federal tax statute enacted after the date of this Agreement. A reference to a specific section of the Code refers not only to such specific section but also to any corresponding provision of any federal tax statute enacted after the date of this Agreement, as such specific section or corresponding provision is in effect on the date of application of the provisions of this Agreement containing such reference. 3 "Covered Person" means any Partner, any Affiliate of a Partner ______________ or any officers, directors, shareholders, partners, employees, representatives or agents of a Partner or its respective Affiliates, or any employee or agent of the Partnership or its Affiliates or any Special Representative. "Definitive LP Certificates" has the meaning set forth in __________________________ Section 10.4. "Dividends" means the distributions of income paid or payable _________ to any Limited Partner who is a Preferred Security Holder pursuant to the terms of the Preferred Securities held by such Limited Partner, including any interest payable in respect of arrears. "DTC" means The Depository Trust Company, the initial Clearing ___ Agency. "Exchange Act" means the Securities Exchange Act of 1934, as ____________ amended. "Fiscal Year" means (i) the period commencing upon the ___________ formation of the Partnership and ending on December 31, 1994, and (ii) any subsequent twelve (12) month period commencing on January 1 and ending on December 31. "General Partner" means PacifiCorp, its successors and assigns, _______________ and any additional or successor general partner in the Partnership admitted as a general partner of the Partnership pursuant to this Agreement. "Guarantee" means the Guarantee Agreement of PacifiCorp in _________ respect of any series of Preferred Securities. "Holders" means, with respect to a series of Preferred _______ Securities, Preferred Security Holders in whose name LP Certificates representing Preferred Securities of such series are registered. "Indemnified Person" means the General Partner, any Special __________________ Representative, any Affiliate of the General Partner or any Special Representative or any officers, directors, shareholders, partners, employees, representatives or agents of the General Partner or any Special Representative, or any employee or agent of the Partnership or its Affiliates. "Indenture" means the Indenture dated as of __________, 1994 _________ between PacifiCorp and The Bank of New York, as Trustee, pursuant to which deferrable interest junior subordinated debentures of PacifiCorp may be issued. "Initial Limited Partner" means PacifiCorp Preferred Capital, _______________________ Inc., a Delaware corporation. "Interest" means the entire ownership interest of a Partner in ________ the Partnership at any particular time, including, without limitation, its interest in the capital, profits, losses and distributions of the Partnership. "Junior Subordinated Debentures" means deferrable interest ______________________________ junior subordinated debentures issued by PacifiCorp under the Indenture. "Limited Partner" means any Person who is admitted to the _______________ Partnership as a limited partner of the Partnership pursuant to the terms of this Agreement. "Liquidation Distribution", with respect to a Preferred ________________________ Security, means the aggregate of the stated liquidation preference of the Preferred Security and accrued and unpaid Dividends thereon (whether or not declared). 4 "Loss Carried Forward Amount" means, as of the first day of any ___________________________ month for any Series, an amount equal to the excess of (x) all Net Loss allocated to the Holders of such series of Preferred Securities from the date of issuance of such series of Preferred Securities through and including the day prior to the first day of such month pursuant to Section _______ 4.1(b)(ii) over (y) the amount of Net Income allocated to the Holders of __________ such series of Preferred Securities pursuant to Section 4.1(a)(ii) in all __________________ prior calendar months. "LP Certificate" means a certificate substantially in the form ______________ attached hereto as Annex A, evidencing the Preferred Securities held by a Limited Partner. "Majority in liquidation preference of the Preferred ___________________________________________________ Securities" means Holder(s) of a series of Preferred Securities or, as the __________ context may require, Holder(s) of more than one series of Preferred Securities voting as a class, who are the record owners of Preferred Securities whose liquidation preference (including the stated preference amount that would be paid on redemption or maturity, plus accrued and unpaid dividends, whether or not declared, to the date upon which the voting percentages are determined) represents more than 50% of the above stated liquidation preference of all Preferred Securities of such series or, as applicable, multiple series. "Net Income" and "Net Loss", respectively, for any period means __________ ________ the income and loss, respectively, of the Partnership for such period as determined in accordance with the method of accounting followed by the Partnership for federal income tax purposes, including, for all purposes, any income exempt from tax and any expenditures of the Partnership which are described in Code Section 705(a)(2)(B); provided, however, that any ________ _______ item allocated under Section 4.2 shall be excluded from the computation of ___________ Net Income and Net Loss. "PacifiCorp" has the meaning set forth in the forepart of this __________ Agreement. "Partners" means the General Partner and the Limited Partners, ________ collectively, where no distinction is required by the context in which the term is used. "Partnership" means the limited partnership formed and ___________ continued pursuant to this Agreement under the name "PacifiCorp Delaware, L.P." "Paying Agent" has the meaning set forth in Section 10.7. ____________ ____________ "Person" means any individual, corporation, limited liability ______ company, association, partnership, trust or other entity. "Preferred Securities" means the limited partner interests in ____________________ the Partnership described in Article VI. __________ "Preferred Security Holder" has the meaning set forth in _________________________ Section 10.3. ____________ "Preferred Security Owner" means, with respect to a Book Entry ________________________ Interest, a Person who is the beneficial owner of such Book Entry Interest, as reflected on the books of the Clearing Agency, or on the books of a Person maintaining an account with such Clearing Agency (directly as a Clearing Agency Participant or as an indirect participant, in each case in accordance with the rules of such Clearing Agency). "Pricing Agreement" means a Pricing Agreement between the _________________ Partnership and PacifiCorp relating to the issuance of the Preferred Securities. "Purchase Price" for any Preferred Security means the amount ______________ paid for such Preferred Security in the initial sale by the Partnership of such Preferred Security. "Regulations" means a Treasury Regulation promulgated under the ___________ Code. 5 "Securities Act" means the Securities Act of 1933, as amended. ______________ "66 2/3% in liquidation preference of the Preferred Securities" _____________________________________________________________ means Holder(s) of a series of Preferred Securities or, as the context may require, Holder(s) of more than one series of Preferred Securities voting as a class, who are the record owners of Preferred Securities whose liquidation preference (including the stated preference amount that would be paid on redemption or maturity, plus accrued and unpaid dividends, whether or not declared, to the date upon which the voting percentages are determined) represents more than 66-2/3% of the above stated liquidation preference of all Preferred Securities of such series or, as applicable, multiple series. "Special Representative" shall mean a special representative of ______________________ the Partnership and the Limited Partners appointed upon a vote of the Holders of a series of Preferred Securities upon the occurrence of specified events to enforce certain rights of the Partnership and such Holders, as set forth in the Action creating such series of Preferred Securities. "Tax Event" means that the General Partner shall have obtained _________ an opinion of nationally recognized independent tax counsel experienced in such matters to the effect that, as a result of (a) any amendment to, or change (including any announced prospective change) in, the laws (or any regulations thereunder) of the United States or any political subdivision or taxing authority thereof or therein, (b) any notice of proposed adjustment issued by the IRS to PacifiCorp or PacifiCorp Delaware, (c) any amendment to or change in an interpretation or application of such laws or regulations by any legislative body, court, governmental agency or regulatory authority (including the enactment of any legislation and the publication of any judicial decision or regulatory determination on or after such date), or (d) any interpretation or pronouncement that provides for a position with respect to such laws or regulations that differs from the generally accepted position on ___________ 1994, which amendment or change is effective, which notice of proposed adjustment is issued or which interpretation or pronouncement is announced on or after _________, 1994, there is more than an insubstantial risk that (i) the Partnership will be subject to federal income tax with respect to interest received on the Junior Subordinated Debentures, (ii) interest payable to the Partnership on the Junior Subordinated Debentures will not be deductible for federal income tax purposes or (iii) the Partnership is subject to more than a de minimis amount of other taxes, duties or other governmental charges. "Tax Matters Partner" means the General Partner designated as ___________________ such in Section 9.9 hereof. ___________ "10% in liquidation preference of the Preferred Securities" _________________________________________________________ means Holders(s) of a series of Preferred Securities or, as the context may require, Holder(s) of more than one series of Preferred Securities voting as a class, who are the record owners of Preferred Securities whose liquidation preference (including the stated preference amount that would be paid on redemption or maturity, plus accrued and unpaid dividends, whether or not declared, to the date upon which the voting percentages are determined) represents more than 10% of the above stated liquidation preference of all Preferred Securities of such series or, as applicable, multiple series. "Treasury Regulations" means the income tax regulations, ____________________ including temporary regulations, promulgated under the Code, as such regulations may be amended from time to time (including corresponding provisions of succeeding regulations). "Underwriting Agreement" means an Underwriting Agreement, among ______________________ the Partnership and the underwriters named therein relating to the issuance of the Preferred Securities. Section 2.2 Headings. The headings and subheadings in this ________ Agreement are included for convenience and identification only and are in no way intended to describe, interpret, define or limit the scope, extent or intent of this Agreement or any provision hereof. 6 ARTICLE III CAPITAL CONTRIBUTIONS, REPRESENTATION OF PREFERRED SECURITY HOLDER'S INTEREST; CAPITAL ACCOUNTS Section 3.1 Capital Contributions. _____________________ (a) The General Partner has, on or prior to the date hereof, contributed an aggregate of $_______ to the capital of the Partnership, which amount is equal to at least 3% of the total capital contributions to the Partnership on the date hereof. Subject to Section 4.1(c), the General ______________ Partner shall from time to time make such additional capital contributions as are necessary to maintain its Capital Account balance at least equal to 3% of the aggregate positive Capital Account balances of all Partners. (b) The Initial Limited Partner has, on or prior to the date hereof, contributed the amount of $50 to the capital of the Partnership which amount is being returned to the Initial Limited Partner. (c) With respect to each Person who is issued a Preferred Security by the Partnership in connection with the initial issuance by the Partnership of such Preferred Security, there shall be contributed to the capital of the Partnership an amount equal to the Purchase Price for such Preferred Security (such amount being such Person's capital contribution to the Partnership). (d) No Limited Partner shall at any time be required to make any additional capital contributions to the Partnership. Section 3.2 Preferred Security Holder's Interest Represented ________________________________________________ by Preferred Securities. A Preferred Security Holder's interest in the _______________________ Partnership shall be represented by the Preferred Securities held by such Preferred Security Holder. Each Preferred Security Holder's respective Preferred Securities shall be set forth on the books and records of the Partnership. Each Partner, including a Preferred Security Holder, hereby agrees that its interest in the Partnership and in its Preferred Securities shall for all purposes be personal property. No Partner, including a Preferred Security Holder, shall have an interest in specific Partnership property. Section 3.3 Capital Accounts. An individual capital account ________________ (a "Capital Account") shall be established and maintained on the books of _______________ the Partnership for each Partner in compliance with Regulation Section 1.704-1(b)(2)(iv) and 1.704-2, as amended. Subject to the preceding sentence, each Capital Account will be credited with the capital contributions made and the profits allocated to the Partner (or predecessor in interest of such Capital Account) and debited by the distributions made and losses allocated to such Partner (or predecessor thereof). Section 3.4 Interest on Capital Contributions. No Partner _________________________________ shall be entitled to interest on or with respect to any capital contribution to the Partnership. Section 3.5 Withdrawal and Return of Capital Contributions. ______________________________________________ No Partner shall be entitled to withdraw any part of such Partner's capital contribution to the Partnership or to receive any distributions from the Partnership, except as provided in this Agreement. 7 ARTICLE IV ALLOCATIONS Section 4.1 Profits and Losses. Except as provided in Section __________________ _______ 4.2, ___ (a) the Partnership's Net Income for each calendar month shall be allocated as follows: (i) First, to the Holders of each series of Preferred Securities as of the record date in such calendar month for the payment of Dividends on such series of Preferred Securities in an amount equal to the excess of (x) all Dividends accrued on such series of Preferred Securities (in accordance with the Action creating such series) from their date of issuance through and including the close of such calendar month over (y) the amount of Net Income allocated to the Holders of such series of Preferred Securities pursuant to this Section 4.1(a)(i) in all prior calendar _________________ months; provided, however, that (A) as to any series of Preferred ________ _______ Securities as to which Dividends are not cumulative, no Dividend shall be deemed to accrue until the Partnership has actually paid (or set aside money to pay) such Dividend and (B) Dividends as to Preferred Securities that are cumulative and are not payable at the end of each calendar month shall be deemed to accrue in a manner consistent with the Action creating such Preferred Securities. Amounts allocated to all Holders of any series of Preferred Securities shall be allocated among such Holders in proportion to the number of Preferred Securities of such series held by such Holders. (ii) Second, 100% to the Holders of any series of Preferred Securities up to an amount equal to the Loss Carried Forward Amount for such series as of the first day of such month. Amounts allocated to all Holders of any series of Preferred Securities shall be allocated among such Holders in proportion to the number of Preferred Securities of such series held by such Holders. (iii) Any remaining Net Income shall be allocated to the General Partner. (b) The Partnership's Net Loss for any Fiscal Period shall be allocated as follows: (i) First, to the General Partner until the General Partner's Capital Account is reduced to zero; provided, however, that ________ _______ the aggregate amount of Net Losses allocated to the General Partner pursuant to this Section 4.1(b)(i) shall not exceed the sum of 3% of _________________ the total capital contributions of all Partners and the aggregate Net Income allocated to the General Partner pursuant to Section 4.1. ___________ (ii) Second, to the Holders of each series of Preferred Securities in proportion to the aggregate Capital Account balances of the Holders of such series of Preferred Securities (calculated taking into account only contributions, distributions and allocations related to such series), until the Capital Account balances of such Holders are reduced to zero; provided, however, that the General Partner shall make appropriate adjustments in these allocations, in accordance with Section 4.1(c) with respect to any Preferred ______________ Securities as to which Net Income has been allocated with respect to Dividends that accrued but were not paid. Amounts allocated to the Holders of any series of Preferred Securities shall be allocated among such Holders in proportion to the number of Preferred Securities of such series held by such Holders. (iii) Any remaining Net Loss shall be allocated to the General Partner. (c) The General Partner shall make such changes to the allocations in Sections 4.1(a) and 4.1(b) in the year of the Partnership's _______________ ______ liquidation as it deems reasonably necessary so that amounts distributed to the Preferred Security Holders in such year in accordance with Section _______ 8 11.4(b) shall equal their Liquidation Distributions; provided, however, _______ ________ _______ that no allocation pursuant to this Section 4.1(c) may result in the ______________ General Partner being required to make any Capital Contributions pursuant to Section 3.1. ___________ Section 4.2 Other Allocation Provisions. ___________________________ (a) For purposes of determining the profits, losses or any other items allocable to any period, profits, losses and any such other items shall be determined on a daily, monthly or other basis, as determined by the General Partner using any method that is permissible under Section 706 of the Code and the Regulations. (b) The Partners are aware of the income tax consequences of the allocations made by this Article IV and hereby agree to be bound by the __________ provisions of this Article IV in reporting their shares of Partnership __________ income and loss for income tax purposes. (c) Notwithstanding anything to the contrary that may be expressed or implied in this Article IV, the interest of the General __________ Partner in each item of income, gain, loss, deduction and credit will be equal to at least (i) at any time that aggregate capital contributions to the Partnership are equal to or less than $50,000,000, 1% of each such item and (ii) at any time that aggregate capital contributions to the Partnership are greater than $50,000,000, at least 1%, multiplied by a fraction (not exceeding one and not less than 0.2), the numerator of which is $50,000,000 and the denominator of which is the lesser of the aggregate Capital Account balances of the Capital Accounts of all Partners at such time and the aggregate capital contributions to the Partnership of all Partners at such time, of such item. (d) (i) If during any taxable year, a Partner unexpectedly receives an adjustment, allocation or distribution described in Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6), which causes or increases a deficit balance in the Partner's Adjusted Capital Account (as defined below), there shall be allocated to the Partner items of Partnership income and gain (consisting of a pro rata portion of each item of Partnership income, including gross income and gain for such year) in an amount and manner sufficient to eliminate such deficit. The foregoing is intended to be a "qualified income offset" provision as described in Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted and applied in all respects in accordance with that Regulation. A Partner's "Adjusted Capital Account" at any time shall ________________________ equal the Partner's Capital Account at such time (x) increased by the sum of (A) the amount of the Partner's share of Partnership minimum gain (as defined in Regulations Section 1.704-2(g)(1) and (3)) and (ii) the amount of the Partner's share of the minimum gain attributable to a "partner non-recourse debt" (as defined in Regulations Section 1.704-2(i)(5)) and (y) decreased by reasonably expected adjustments, allocations and distributions described in Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6). (ii) While this Agreement does not provide certain provisions required by Regulations Sections 1.704-1(b) and 1.704-2 because those provisions apply to transactions that are not expected to occur, the Partners intend that the allocations under Section 4.1 ___________ conform to Regulations Section 1.704-1(b) and 1.704-2 (including, without limitation, the minimum gain chargeback of partner nonrecourse debt minimum gain and partner nonrecourse debt provisions of such Regulation), and the General Partner shall make such changes in the allocations under Section 4.1 as it believes are reasonably ___________ necessary to meet the requirements of such Regulations. (e) Solely for the purpose of adjusting the Capital Accounts of the Partners, and not for tax purposes, if any property is distributed in kind to any Partner, the difference between its fair market value and its book value at the time of distribution shall be treated as gain or loss recognized by the Partnership and allocated pursuant to the provisions of Section 4.1; provided, ___________ ________ 9 however, that Net Income and Net Loss allocated as a _______ result of the distribution of any series of Junior Subordinated Debentures to the Holders of any series of Preferred Securities or to the General Partner (or both) shall be allocated to the Partner receiving the Junior Subordinated Debentures in proportion to the amount of Junior Subordinated Debentures distributed to them. For this purpose, the fair market value of any property shall be determined by the General Partner in its sole discretion; provided, however, that the value of any Junior Subordinated ________ _______ Debenture shall at all times be treated as equal to the value of any Preferred Security if the interest rate on and principal amount of the Junior Subordinated Debenture is the same as the Dividend payable on and the liquidation preference with respect to the Preferred Security. Section 4.3 Allocations for Income Tax Purposes. The income, ___________________________________ gains, losses, deductions and credits of the Partnership shall be allocated in the same manner as the items entering into the computation of Net Income and Net Loss were allocated under Sections 4.1 and 4.2; provided, however, ____________ ___ ________ _______ that solely for federal, state and local income and franchise tax purposes and not for book or Capital Account purposes, income, gain, loss and deduction with respect to any property properly carried on the Partnership's books at a value other than the tax basis of such property shall be allocated in a manner determined in the General Partner's discretion, so as to take into account (consistently with Code Section 704(c) principles) the difference between such property's book value and its tax basis. Section 4.4 Withholding. The Partnership shall comply with ___________ withholding requirements under federal, state and local law and shall remit amounts withheld to and file required forms with applicable jurisdictions. To the extent that Partnership is required to withhold and pay over any amounts to any authority with respect to distributions or allocations to any Partner, the amount withheld shall be deemed to be a distribution in the amount of the withholding to the Partner. In the event of any claimed over-withholding, Partners shall be limited to an action against the applicable jurisdiction. If the amount withheld was not withheld from actual distributions, the Partnership may reduce subsequent distributions by the amount of such withholding. Each Partner agrees to furnish the Partnership with any representations and forms as shall reasonably be requested by the Partnership to assist it in determining the extent of, and in fulfilling, its withholding obligations. ARTICLE V DIVIDENDS Section 5.1 Dividends. Limited Partners shall receive _________ periodic Dividends, if any, redemption payments and liquidation distributions in accordance with the applicable terms of the Preferred Securities. Subject to the rights of the Preferred Securities, all remaining cash shall be distributed to the General Partner at such time as the General Partner shall determine. Section 5.2 Limitations on Distributions. Notwithstanding any ____________________________ provision to the contrary contained in this Agreement, the Partnership shall not make a distribution to any Partner on account of its interest in the Partnership if such distribution would violate Section 17-607 of the Act or other applicable law. ARTICLE VI ISSUANCE OF PREFERRED SECURITIES Section 6.1 Aggregate Number. The aggregate number of ________________ Preferred Securities which the Partnership shall have authority to issue is unlimited. Section 6.2 Powers, Preferences, Rights and Limitations. The ___________________________________________ powers, preferences, special rights and limitations of the Preferred Securities shall be as follows: 10 (a) The payment of Dividends and payments on dissolution of the Partnership or on redemption in respect of Preferred Securities shall be guaranteed by PacifiCorp pursuant to the Guarantee. The Preferred Security Holders hereby authorize the General Partner to hold the Guarantee on behalf of the Preferred Security Holders. In the event of the appointment of a Special Representative to, among other things, enforce the Guarantee, the Special Representative may take possession of the Guarantee for such purpose. If no Special Representative has been appointed to enforce the Guarantee, the General Partner has the right to enforce the Guarantee on behalf of the Preferred Security Holders. The Holders of not less than 10% in liquidation preference of the Preferred Securities have the right to direct the time, method and place of conducting any proceeding for any remedy available in respect of the Guarantee including the giving of directions to the General Partner or the Special Representative, as the case may be. If the General Partner or the Special Representative fails to enforce the Guarantee as above provided, a Preferred Security Holder may institute a legal proceeding directly against the Guarantor to enforce its rights under the Guarantee, without first instituting a legal proceeding against the Partnership or any other Person. The Preferred Security Holders, by acceptance of such Preferred Securities, hereby agree to the subordination provisions and other terms of the Guarantee; (b) The Preferred Securities may be issued from time to time by the Partnership as Preferred Securities of one or more series and the General Partner is expressly authorized, prior to issuance, in a written action or actions (each, an "Action") providing for the issue of Preferred ______ Securities of each particular series, to fix the following: (i) the distinctive designation of such series which shall distinguish it from other series; (ii) the number of Preferred Securities included in such series, which number may be increased or decreased from time to time unless otherwise provided by the General Partner in creating the series; (iii) the annual Dividend rate (or method of determining such rate) for Preferred Securities of such series and the date or dates upon which such Dividends shall be payable; provided, however, ________ _______ Dividends on any series of Preferred Securities shall be payable on a monthly basis to Holders of such series of Preferred Securities as of a record date in each month during which such series of Preferred Securities are outstanding; (iv) whether Dividends on the Preferred Securities of such series shall be cumulative, and, in the case of Preferred Securities of any series having cumulative Dividend rights, the date or dates or method of determining the date or dates from which Dividends on the Preferred Securities of such series shall be cumulative; (v) the amount or amounts which shall be paid out of the assets of the Partnership to the Holders of the Preferred Securities of such series upon voluntary or involuntary dissolution, winding up or termination of the Partnership; (vi) the price or prices at which, the period or periods within which and the terms and conditions upon which the Preferred Securities of such series may be redeemed or purchased, in whole or in part, at the option of the Partnership or the General Partner; (vii) the obligation, if any, of the Partnership to purchase or redeem Preferred Securities of such series and the price or prices at which, the period or periods within which and the terms and conditions upon which the Preferred Securities of such series shall be purchased or redeemed, in whole or in part, pursuant to such obligation; (viii) the voting rights, if any, of the Preferred Securities of such series in addition to those required by law, including the number of votes per Preferred Security and any requirement for the approval by the Holders of Preferred Securities, or of the Preferred 11 Securities of one or more series, or of both, as a condition to specified action or amendments to this Agreement; and (ix) any other relative rights, powers, preferences or limitations of the Preferred Securities of the series not inconsistent with this Agreement or with applicable law. In connection with the foregoing and without limiting the generality thereof, the General Partner is hereby expressly authorized, without the vote or approval of any Preferred Security Holder, (i) to take any Action to create under the provisions of this Agreement a series of Preferred Securities that was not previously outstanding and (ii) to admit Preferred Security Holders as limited partners in the Partnership. Without the vote or approval of any Preferred Security Holder, the General Partner may execute, swear to, acknowledge, deliver, file and record whatever documents may be required in connection with the issue from time to time of Preferred Securities in one or more series as shall be necessary, convenient or desirable to reflect the issue of such series. The General Partner shall do all things it deems to be appropriate or necessary to comply with the Act and is authorized and directed to do all things it deems to be necessary or permissible in connection with any future issuance, including compliance with any statute, rule, regulation or guideline of any federal, state or other governmental agency or any securities exchange. Any Action or Actions taken by the General Partner pursuant to the provisions of this paragraph (b) shall be deemed an _____________ amendment and supplement to and part of this Agreement. (c) The proceeds received by the Partnership from the issuance of any series of Preferred Securities, together with the proceeds of any capital contribution of the General Partner made at the time of such issuance, shall be invested by the Partnership in Junior Subordinated Debentures with (i) an aggregate principal amount equal to such aggregate proceeds and (ii) an interest rate equal to the Dividend rate of such series of Preferred Securities. (d) So long as any series of Junior Subordinated Debentures are held by the Partnership, the General Partner shall not (i) direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee with respect to such series, (ii) waive any past default which is waivable under Section 6.06 of the Indenture, (iii) exercise any right to rescind or annul a declaration that the principal of all the Junior Subordinated Debentures of such series shall be due and payable or (iv) consent to any amendment, modification or termination of the Indenture without, in each case, obtaining the prior approval of the Holders of at least 66-2/3% in liquidation preference of all series of Preferred Securities affected thereby, acting as a single class; provided, however, ________ _______ that where a consent under the Indenture would require the consent of each holder of Junior Subordinated Debentures affected thereby, no such consent shall be given by the General Partner without the prior consent of each Holder of all series of Preferred Securities affected thereby. The General Partner shall not revoke any action previously authorized or approved by a vote of any series of Preferred Securities affected thereby. The General Partner shall notify all Holders of any series of Preferred Securities of any notice of default received from the Trustee with respect to the related series of Junior Subordinated Debentures. (e) The Partnership may not issue any limited partner interests in the Partnership (including, without limitation, any series of Preferred Securities), unless such series of Preferred Securities ranks pari passu with each other series of Preferred Securities then outstanding as regards (i) participation in profits and Dividends of the Partnership and (ii) participation in the assets of the Partnership. All Preferred Securities shall rank senior to the General Partner's Interest in respect of the right to receive Dividends and the right to receive payments out of the assets of the Partnership upon voluntary or involuntary dissolution, winding up or termination of the Partnership. All Preferred Securities redeemed, purchased or otherwise acquired by the Partnership (including Preferred Securities surrendered for conversion or exchange) shall be canceled. 12 (f) No Holder of a Preferred Security shall be entitled as a matter of right to subscribe for or purchase, or have any preemptive right with respect to, any part of any new or additional issue of Preferred Securities of any class whatsoever, or of securities convertible into any Preferred Securities of any class whatsoever, whether now or hereafter authorized and whether issued for cash or other consideration or by way of a Dividend. ARTICLE VII BOOKS OF ACCOUNT, RECORDS AND REPORTS Section 7.1 Books and Records. _________________ (a) Proper and complete records and books of account of the Partnership shall be kept by the General Partner in which shall be entered fully and accurately all transactions and other matters relative to the Partnership's business as are usually entered into records and books of account maintained by Persons engaged in businesses of a like character, including a Capital Account for each Partner. The books and records of the Partnership, together with a copy of this Agreement and a certified copy of the Certificate, shall at all times be maintained at the principal office of the Partnership and shall be open to the inspection and examination of the Limited Partners or their duly authorized representatives for a proper purpose reasonably related to its Interest during reasonable business hours. (b) Notwithstanding any other provision of this Agreement, the General Partner may, to the maximum extent permitted by applicable law, keep confidential from the Partners any information the General Partner reasonably believes to be in the nature of trade secrets or other information the disclosure of which the General Partner reasonably believes is not in the best interests of the Partnership or could damage the Partnership or which the Partnership or the General Partner is required by law or by an agreement with any Person to keep confidential. (c) Within three months after the close of each Fiscal Year, the General Partner shall transmit to each Partner, a statement indicating such Partner's share of each item of Partnership income, gain, loss, deduction or credit for such Fiscal Year for federal income tax purposes. Section 7.2 Accounting Method. For both financial and tax _________________ reporting purposes and for purposes of determining profits and losses, the books and records of the Partnership shall be kept on the accrual method of accounting applied in a consistent manner and shall reflect all Partnership transactions and be appropriate and adequate for the Partnership's business. ARTICLE VIII POWERS, RIGHTS AND DUTIES OF THE LIMITED PARTNERS Section 8.1 Limitations. The Limited Partners shall not ___________ participate in the management or control of the Partnership's business, property or other assets nor shall the Limited Partners transact any business for the Partnership, nor shall the Limited Partners have the power to act for or bind the Partnership, said powers being vested solely and exclusively in the General Partner. The Limited Partners shall have such rights as are set forth herein, including any Action, and as are set forth in the Guarantee and the Indenture. The Limited Partners shall have no interest in the properties or assets of the General Partner, or any equity therein, or in any proceeds of any sales thereof (which sales shall not be restricted in any respect, by virtue of acquiring or owning an Interest. 13 Section 8.2 Liability. Subject to the provisions of the Act, _________ no Limited Partner shall be liable for the repayment, satisfaction or discharge of any debts or other obligations of the Partnership in excess of the Capital Account balance of such Limited Partner. Section 8.3 Priority. Except as may be provided in any ________ Action, no Limited Partner shall have priority over any other Limited Partner as to Partnership allocations or distributions. ARTICLE IX POWERS, RIGHTS AND DUTIES OF THE GENERAL PARTNER Section 9.1 Authority. Subject to the limitations provided in _________ this Agreement, the General Partner shall have exclusive and complete authority and discretion to manage the operations and affairs of the Partnership and to make all decisions regarding the business of the Partnership. Any action taken by the General Partner shall constitute the act of and serve to bind the Partnership. In dealing with the General Partner acting on behalf of the Partnership, no Person shall be required to inquire into the authority of the General Partner to bind the Partnership. Persons dealing with the Partnership are entitled to rely conclusively on the power and authority of the General Partner as set forth in this Agreement. Section 9.2 Powers and Duties of General Partner. Except as ____________________________________ otherwise specifically provided herein, the General Partner shall have all rights and powers of a general partner under the Act, and shall have all authority, rights and powers in the management of the Partnership business to do any and all other acts and things necessary, proper, convenient or advisable to effectuate the purposes of this Agreement, including by way of illustration but not by way of limitation, the following: (a) to secure the necessary goods and services required in performing the General Partner's duties for the Partnership; (b) to exercise all powers of the Partnership, on behalf of the Partnership, in connection with enforcing the Partnership's rights and interest under the Junior Subordinated Debentures and the Guarantee; (c) to issue Preferred Securities, and series thereof, in accordance with this Agreement; (d) To dissolve the Partnership upon the occurrence of a Tax Event in accordance with the provisions of an Action; (e) to establish a record date with respect to all actions to be taken hereunder that require a record date be established, including with respect to Dividends and voting rights, and to make determinations as to the payment of Dividends, and make all other required payments to Preferred Security Holders and to the General Partner as the Partnership's paying agent; (f) to open, maintain and close bank accounts and to draw checks and other orders for the payment of money; (g) to bring or defend, pay, collect, compromise, arbitrate, resort to legal action, or otherwise adjust claims or demands of or against the Partnership; (h) to deposit, withdraw, invest, pay, retain and distribute the Partnership's funds in a manner consistent with the provisions of this Agreement; 14 (i) to take all action which may be necessary or appropriate for the preservation and the continuation of the Partnership's valid existence, rights, franchises and privileges as a limited partnership under the laws of the State of Delaware and of each other jurisdiction in which such existence is necessary to protect the limited liability of the Limited Partners or to enable the Partnership to conduct the business in which it is engaged; (j) to take all action not inconsistent with applicable law, the Certificate or this Agreement, as long as such action does not adversely affect the interests of the Preferred Security Holders, necessary to conduct its affairs and to operate the Partnership in such a way that the Partnership would not be deemed an "investment company" required to be registered under the Investment Company Act of 1940, as amended, or taxed as a corporation for federal income tax purposes and so that the Junior Subordinated Debentures will be treated as indebtedness of PacifiCorp for federal income tax purposes; (k) to cause the Partnership to enter into and perform, on behalf of the Partnership, an Underwriting Agreement and a Pricing Agreement and to cause the Partnership to purchase the Junior Subordinated Debentures without any further act, vote or approval of any Partner; and (l) to execute and deliver any and all documents or instruments, perform all duties and powers and do all things for and on behalf of the Partnership in all matters necessary, desirable or incidental to the foregoing. Section 9.3 Liability. Except as expressly set forth in this _________ Agreement, (a) the General Partner shall not be personally liable for the return of any portion of the capital contributions (or any return thereon) of the Limited Partners; (b) the return of such capital contributions (or any return thereon) shall be made solely from assets of the Partnership; and (c) the General Partner shall not be required to pay to the Partnership or to any Limited Partner any deficit any Limited Partner's Capital Account upon dissolution or otherwise. Section 9.4 Exculpation. (a) No Indemnified Person shall be ___________ liable, responsible or accountable in damages or otherwise to the Partnership or any Covered Person for any loss, damage or claim incurred by reason of any act or omission performed or omitted by such Indemnified Person in good faith on behalf of the Partnership and in a manner reasonably believed to be within the scope of the authority conferred on such Indemnified Person by this Agreement or by law except that an Indemnified Person shall be liable for any such loss, damage or claim incurred by reason of such Indemnified Person's gross negligence or willful misconduct with respect to such acts or omissions. (b) An Indemnified Person shall be fully protected in relying in good faith upon the records of the Partnership and upon such information, opinions, reports or statements presented to the Partnership by any Person as to matters the Indemnified Person reasonably believes are within such other Person's professional or expert competence and who has been selected with reasonable care by or on behalf of the Partnership, including information, opinions, reports or statements as to the value and amount of the assets, liabilities, profits, losses, or any other facts pertinent to the existence and amount of assets from which distributions to Partners might properly be paid. Section 9.5 Fiduciary Duty. ______________ (a) To the extent that, at law or in equity, an Indemnified Person has duties (including fiduciary duties) and liabilities relating thereto to the Partnership or to any other Covered Person, an Indemnified Person Acting under this Agreement shall not be liable to the Partnership or to any other Covered Person for its good faith reliance on the provisions of this Agreement. The provisions of this Agreement, to the extent that they restrict the duties and liabilities of an Indemnified Person otherwise existing at law or in equity, are agreed by the parties hereto to replace such other duties and liabilities of such Indemnified Person. 15 (b) Unless otherwise expressly provided herein, (i) whenever a conflict of interest exists or arises between Covered Persons or (ii) whenever this Agreement or any other agreement contemplated herein or therein provides that an Indemnified Person shall act in a manner that is, or provides terms that are, fair and reasonable to the Partnership or any Partner, the Indemnified Person shall resolve such conflict of interest, taking such action or providing such terms, considering in each case the relative interest of each party (including its own interest) to such conflict, agreement, transaction or situation and the benefits and burdens relating to such interests, any customary or accepted industry practices, and any applicable generally accepted accounting practices or principles. In the absence of bad faith by the Indemnified Person, the resolution, action or term so made, taken or provided by the Indemnified Person shall not constitute a breach of this Agreement or any other agreement contemplated herein or of any duty or obligation of the Indemnified Person at law or in equity or otherwise. (c) Whenever in this Agreement an Indemnified Person is permitted or required to make a decision (i) in its "discretion" or under a grant of similar authority, the Indemnified Person shall be entitled to consider such interests and factors as it desires, including its own interests, and shall have no duty or obligation to give any consideration to any interest of or factors affecting the Partnership or any other Person or (ii) in its "good faith" or under another express standard, the Indemnified Person shall act under such express standard and shall not be subject to any other or different standard imposed by this Agreement or other applicable law. Section 9.6 Indemnification. _______________ (a) To the fullest extent permitted by applicable law, the Partnership shall indemnify and hold harmless each Indemnified Person from and against any loss, damage or claim incurred by such Indemnified Person by reason of any act or omission performed or omitted by such Indemnified Person in good faith on behalf of the Partnership and in a manner reasonably believed to be within the scope of authority conferred on such Indemnified Person by this Agreement, except that no Indemnified Person shall be entitled to be indemnified in respect of any loss, damage or claim incurred by such Indemnified Person by reason of gross negligence or willful misconduct with respect to such acts or omissions; provided, ________ however, that any indemnity under this Section 9.6 shall be provided out of _______ ___________ and to the extent of Partnership assets only, and no Covered Person shall have any personal liability on account thereof. (b) To the fullest extent permitted by applicable law, expenses (including legal fees) incurred by an Indemnified Person in defending any claim, demand, action, suit or proceeding shall, from time to time, be advanced by the Partnership prior to the final disposition of such claim, demand, action, suit or proceeding upon receipt by the Partnership of an undertaking by or on behalf of the Indemnified Person to repay such amount if it shall be determined that the Indemnified Person is not entitled to be indemnified as authorized in Section 9.6(a). ______________ Section 9.7 Outside Businesses. Any Covered Person may __________________ engage in or possess an interest in other business ventures of any nature of description, independently or with others, similar or dissimilar to the business of the Partnership, and the Partnership and the Partners shall have no rights by virtue of this Agreement in and to such independent ventures or the income or profits derived therefrom and the pursuit of any such venture, even if competitive with the business of the Partnership, shall not be deemed wrongful or improper. No Covered Person shall be obligated to present any particular investment opportunity to the Partnership even if such opportunity is of a character that, if presented to the Partnership, could be taken by the Partnership, and any Covered Person shall have the right to take for its own account (individually or as a partner or fiduciary) or to recommend to others any such particular investment opportunity. Section 9.8 Limits on General Partner's Powers. Anything in __________________________________ this Agreement to the contrary notwithstanding, the General Partner shall not cause or permit the Partnership to 16 (a) acquire any assets other than as expressly provided herein; (b) possess Partnership property for other than a Partnership purpose; (c) admit a Person as a partner of the Partnership, except as expressly provided in this Agreement; (d) make any loans to the General Partner or its Affiliates, other than loans represented by the Junior Subordinated Debentures or other similar debt instruments of PacifiCorp; (e) perform any act that would subject any Limited Partner to liability as a general partner in any jurisdiction; (f) engage in any activity that is not consistent with the purposes of the Partnership, as set forth in Section 1.3; ___________ (g) confess a judgment against the Partnership; (h) without the written consent of 66-2/3% in liquidation preference of the outstanding Preferred Securities, have an order for relief entered with respect to the Partnership or commence a voluntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or consent to the entry of an order for relief in an involuntary case under any such law, or consent to the appointment of or taking possession by a receiver, trustee or other custodian for all or a substantial part of the Partnership's property, or make any assignment for the benefit of creditors of the Partnership; it being understood that nothing in this paragraph (h) is to effect the ability of the Partnership _____________ to dissolve pursuant to this Agreement; or (i) subject to Section 1.3, borrow money or become liable for ___________ the borrowings of any third party or to engage in any financial or other trade or business. Section 9.9 Tax Matters Partner. (a) For purposes of Code ___________________ Section 6231(a)(7), the "Tax Matters Partner" shall be the General Partner ___________________ as long as it remains the general partner of the Partnership. The Tax Matters Partner shall keep the Limited Partners fully informed of any inquiry, examination or proceeding. (b) The General Partner shall not make an election in accordance with Section 754 of the Code. (c) The General Partner and the Preferred Security Holders acknowledge that they intend, for U.S. federal income tax purposes, that the Partnership shall be treated as a partnership and that the General Partner and the Preferred Security Holders shall be treated as partners of such Partnership for such purposes. Section 9.10 Expenses. The General Partner shall pay for all, ________ and the Partnership shall not be obligated to pay, directly or indirectly, for any, costs and expenses of the Partnership (including, but not limited to, costs and expenses relating to the organization of, and offering of limited partner interests in, the Partnership and costs and expenses relating to the operation of the Partnership, including without limitation, costs and expenses of accountants, attorneys, statistical or bookkeeping services and computing or accounting equipment, paying agent(s), registrar(s), transfer agent(s), duplicating, travel and telephone and costs and expenses incurred in connection with the acquisition, financing and disposition of Partnership assets). 17 ARTICLE X TRANSFERS OF INTERESTS BY PARTNERS Section 10.1 Transfer of Interests. _____________________ (a) Preferred Securities shall be freely transferable by a Preferred Security Holder. (b) The General Partner may not assign its interest in the Partnership in whole or in part under any circumstances except to a successor of PacifiCorp as permitted under the Indenture. The admission of such successor as a general partner of the Partnership shall be effective upon the filing of an amendment to the Certificate with the Secretary of State of the State of Delaware which indicates that such successor has been admitted as a general partner in the Partnership. If the General Partner assigns its entire Interest to a successor of PacifiCorp as permitted under the Indenture, the General Partner shall cease to be a general partner in the Partnership simultaneously with the admission of the successor as a general partner in the Partnership. Any such successor general partner in the Partnership is hereby authorized to and shall continue the business of the Partnership without dissolution. (c) No Interest shall be transferred, in whole or in part, except in accordance with the terms and conditions set forth in this Agreement. Any transfer or purported transfer of any Interest not made in accordance with this Agreement shall be null and void. Section 10.2 Transfer of LP Certificates. The General Partner ___________________________ shall provide for the registration of LP Certificates and of transfers of LP Certificates. Upon surrender for registration of transfer of any LP Certificate, the General Partner shall cause one or more new LP Certificates to be issued in the name of the designated transferee or transferees. Every LP Certificate surrendered for registration of transfer shall be accompanied by a written instrument of transfer in form satisfactory to the General Partner duly executed by the Preferred Security Holder or his attorney duly authorized in writing. Each LP Certificate surrendered for registration of transfer shall be canceled by the General Partner. A transferee of an LP Certificate shall be admitted to the Partnership as a limited partner of the Partnership and shall be entitled to the rights and subject to the obligations of a Preferred Security Holder hereunder upon the receipt by a transferee of an LP Certificate. By acceptance of an LP Certificate, each transferee shall be deemed to have requested admission as a Limited Partner and to have agreed to be bound by this Agreement. The transferor of an LP Certificate, in whole, shall cease to be a limited partner of the Partnership at the time that the transferee of such LP Certificate is admitted to the Partnership as a limited partner of the Partnership in accordance with this Section 10.2. ____________ Section 10.3 Persons Deemed Preferred Security Holders. The _________________________________________ Partnership may treat the Person in whose name any LP Certificate shall be registered on the books and records of the Partnership as the sole holder of such LP Certificate and of the Preferred Securities represented by such LP Certificate (the "Preferred Security Holder") for purposes of receiving _________________________ Dividends and for all other purposes whatsoever and, accordingly, shall not be bound to recognize any equitable or other claim to or interest in such LP Certificate or in the Preferred Securities represented by such LP Certificate on the part of any other Person, whether or not the Partnership shall have actual or other notice thereof. Section 10.4 Book Entry Interests. The LP Certificates, on ____________________ original issuance, will be issued in the form of a global LP Certificate or LP Certificates representing the Book Entry Interests, to be delivered to DTC, the initial Clearing Agency, by, or on behalf of, the Partnership. Such LP Certificate or LP Certificates shall initially be registered on the books and records of the Partnership in the name of Cede & Co., the nominee of DTC, and no Preferred Security Owner will receive a definitive LP Certificate representing such Preferred Security Owner's interests in such LP Certificate, except as provided in Section 10.7. Unless and until ____________ definitive, fully registered 18 LP Certificates (the "Definitive LP _____________ Certificates") have been issued to the Preferred Security Owners pursuant ____________ to Section 10.7: ____________ (i) The provisions of this Section shall be in full force and effect; (ii) The Partnership and the General Partner shall be entitled to deal with the Clearing Agency for all purposes of this Agreement (including the payment of Dividends on the LP Certificates and receiving approvals, votes or consents hereunder) as the Preferred Security Holder and the sole holder of the LP Certificates and shall have no obligation to the Preferred Security Owner; (iii) To the extent that the provisions of this Section conflict with any other provisions of this Agreement, the provisions of this Section shall control; and (iv) The rights of the Preferred Security Owners shall be exercised only through the Clearing Agency and shall be limited to those established by law and agreements between such Preferred Security Owners and the Clearing Agency and/or the Clearing Agency Participants. DTC will make book entry transfers among the Clearing Agency participants and receive and transmit payments of Dividends on the LP Certificates to such Clearing Agency Participants. Section 10.5 Notices to Clearing Agency. Whenever a notice or __________________________ other communication to the Preferred Security Holders is required under this Agreement, unless and until Definitive LP Certificates shall have been issued to the Preferred Security Owners pursuant to Section 10.7, the ____________ General Partner shall give all such notices and communications specified herein to be given to the Preferred Security Holders to the Clearing Agency, and shall have no obligations to the Preferred Security Owners. Section 10.6 Appointment of Successor Clearing Agency. If any ________________________________________ Clearing Agency elects to discontinue its services as securities depository with respect to the Preferred Securities, the General Partner may, in its sole discretion, appoint a successor Clearing Agency with respect to the Preferred Securities. Section 10.7 Definitive LP Certificates; Appointment of Paying _________________________________________________ Agent(s). If (i) a Clearing Agency elects to discontinue its services as ________ securities depository with respect to the Preferred Securities and a successor Clearing Agency is not appointed within 90 days after such discontinuance pursuant to Section 10.6 or (ii) the Partnership elects to ____________ terminate the book entry system through the Clearing Agency, then (a) Definitive LP Certificates shall be prepared by the Partnership and (b) the General Partner shall authorize one or more Persons (each, a "Paying ______ Agent") to pay Dividends, redemption payments or liquidation payments on _____ behalf of the Partnership with respect to the Preferred Securities. Upon surrender of the global LP Certificate or LP Certificates representing the Book Entry Interests by the Clearing Agency, accompanied by registration instructions, the General Partner shall cause Definitive LP Certificates to be delivered to Preferred Security Owners in accordance with the instructions of the Clearing Agency. Neither the General Partner nor the Partnership shall be liable for any delay in delivery of such instructions and may conclusively rely on, and shall be protected in relying on, such instructions. Any Person receiving a Definitive LP Certificate in accordance with this Article X shall be admitted to the Partnership as a _________ limited partner of the Partnership upon receipt of such Definitive LP Certificate and shall be registered on the books and records of the Partnership as a Preferred Security Holder. The Clearing Agency or the nominee of the Clearing Agency, as the case may be, shall cease to be a limited partner of the Partnership under this Section 10.7 at the time that ____________ at least one additional Person is admitted to the Partnership as a Limited Partner in accordance with this Section 10.7. The Definitive LP ____________ Certificates shall be printed, lithographed or engraved or may be produced in any other manner as is reasonably acceptable to the General Partner, as evidenced by its execution thereof. 19 ARTICLE XI WITHDRAWAL; DISSOLUTION; LIQUIDATION AND DISTRIBUTION OF ASSETS Section 11.1 Withdrawal of Partners. Subject to the further ______________________ provisions of this Section 11.1 and except as provided in Article X, no ____________ _________ Partner shall at any time retire or withdraw from the Partnership. Any Partner retiring or withdrawing in contravention of this Section 11.1 shall ____________ indemnify, defend and hold harmless the Partnership and the other Partners from and against any losses, expenses, judgments, fines, settlements or damages suffered or incurred by the Partnership or such other Partners arising out of or resulting from such retirement or withdrawal. No permitted transfer of all or any portion of a Partner's Interest in the Partnership in accordance with Article X shall constitute a withdrawal in _________ violation of this Section 11.1. Further, the withdrawal of a Holder in ____________ connection with the redemption of its entire Interest in the Partnership, in accordance with the terms hereof or of an Action, shall not constitute a violation of this Section 11.1. ____________ Section 11.2 Dissolution of the Partnership. ______________________________ (a) The Partnership shall not be dissolved by the admission of additional or successor Partners in accordance with the terms of this Agreement. The death, withdrawal, bankruptcy or dissolution of a Limited Partner, or the occurrence of any other event which terminates the Interest of a Limited Partner in the Partnership, shall not, in and of itself, cause the Partnership to be dissolved and its affairs wound up. To the fullest extent permitted by applicable law, upon the occurrence of such event, the General Partner may, without any further act, vote or approval of any Partner, admit any Person to the Partnership as an additional or substitute limited partner in the Partnership, which admission shall be effective as of the date of the occurrence of such event, and the business of the Partnership shall be continued without dissolution. (b) The Partnership shall be dissolved and its affairs shall be wound up upon the occurrence of any of the following events: (i) The expiration of the term of the Partnership, as provided in Section 1.4 hereof; ___________ (ii) Upon the bankruptcy of the General Partner or the assignment by the General Partner of its entire interest in the Partnership when the assignee is not admitted to the Partnership as a general partner of the Partnership in accordance with Section 10.1, ____________ or the filing of a certificate of dissolution or its equivalent, with respect to the General Partner, or the revocation of the General Partner's charter and the expiration of 90 days after the date of notice to the General Partner of revocation without a reinstatement of its charter, or any other event occurs which causes the General Partner to cease to be a general partner of the Partnership under the Act, provided that the Partnership shall not be dissolved and required to be wound up in connection with any of the events specified in this Section 11.2(b)(ii) if (A) at the time of the ___________________ occurrence of such event all of the remaining general partners of the Partnership, if any, agree to and do carry on the business of the Partnership or (B) within 90 days after the occurrence of such event, a majority in Interest of the remaining Partners (or such greater percentage in Interest as is required by the Act) agree in writing to continue the business of the Partnership and to the appointment, effective as of the date of such event, of one or more additional general partners of the Partnership; (iii) In accordance with any Action; (iv) the entry of a decree of judicial dissolution under the Act; or (v) the written consent of all Partners. 20 (c) Upon dissolution of the Partnership, the Liquidator (as defined below) shall promptly notify the Partners of such dissolution. Section 11.3 Liquidation. (a) In the event of the dissolution ___________ of the Partnership for any reason, the General Partner (or, if the Partnership is dissolved pursuant to Section 11.2(b)(ii), then a liquidating trustee appointed by 66 2/3% in liquidation preference of the Preferred Securities (the General Partner or such Person so appointed is hereinafter referred to as the "Liquidator")), shall commence to wind up __________ the affairs of the Partnership and to liquidate the Partnership's assets; provided, however, that a reasonable time shall be allowed for the orderly ________ _______ liquidation of the assets of the Partnership and the satisfaction of liabilities to creditors so as to enable the Partners to minimize the normal losses attendant upon liquidation. The Partners shall continue to share all income, losses and distributions during the period of liquidation in accordance with Articles IV and V. Subject to the provisions of this ___________ _ Article XI, the Liquidator shall have full right and unlimited discretion __________ to determine the time, manner and terms of any sale or sales of Partnership property pursuant to such liquidation, giving due regard to the activity and condition of the relevant market and general financial and economic conditions. (b) The Liquidator shall have all of the rights and powers with respect to the assets and liabilities of the Partnership in connection with the liquidation and termination of the Partnership that the General Partner would have with respect to the assets and liabilities of the Partnership during the term of the Partnership, and the Liquidator is hereby expressly authorized and empowered to execute any and all documents necessary or desirable to effectuate the liquidation and termination of the Partnership and the transfer of any assets. (c) Notwithstanding the foregoing, a Liquidator which is not the General Partner shall not be deemed a Partner in the Partnership and shall not have any of the economic interests in the Partnership of a Partner; and such Liquidator may be compensated for its services to the Partnership at normal customary and competitive rates for its services to the Partnership as reasonably determined by a majority-in-interest of the Limited Partners. Section 11.4 Distribution in Liquidation. Upon the winding up ___________________________ of the Partnership, the assets of the Partnership shall be distributed in the following order of priority: (a) to creditors of the Partnership, including Preferred Security Holders who are creditors, to the extent otherwise permitted by law, in satisfaction of the liabilities of the Partnership (whether by payment or the making of reasonable provision for payment thereof), other than liabilities for distributions (including Dividends) to Partners; and (b) to the Partners in proportion to the Partners' positive Capital Account balances after giving effect to any allocation of Net Income and Net Loss (and all items of Partnership income, gain, loss and deduction thereof) pursuant to Article IV. Section 11.5 Rights of Limited Partners. Each Limited Partner __________________________ shall look solely to the assets of the Partnership for all distributions with respect to the Partnership and such Partner's capital contribution (including return thereof), and such Partner's share of profits or losses thereof, and shall have no recourse therefor (upon dissolution or otherwise) against the General Partner. Other than the distributions made in connection with the occurrence of a Tax Event in accordance with the terms of an Action, no distribution of Partnership property shall be made in kind. Notwithstanding anything in the Act or this Agreement to the contrary, in the event of a distribution in connection with the occurrence of a Tax Event, a Partner may be compelled to accept a distribution of an asset in kind from the Partnership even if the percentage of the asset distributed to it exceeds a percentage of the asset which is equal to the percentage in which such Partner shares in distributions from the Partnership. Section 11.6 Termination. The Partnership shall terminate ___________ when all of the assets of the Partnership shall have been disposed of and the assets shall have been distributed as provided 21 in Section 11.4 and the Liquidator shall have executed and caused to be ____________ filed a certificate of cancellation of the Certificate. ARTICLE XII AMENDMENTS AND MEETINGS Section 12.1 Amendments. Except as otherwise provided in this __________ Agreement or by any applicable terms of any Action establishing a series of Preferred Securities, this Agreement may be amended by, and only by, a written instrument executed by the General Partner; provided, however, that ________ _______ (i) no amendment shall be made, and any such purported amendment shall be void and ineffective, to the extent the result thereof would be to cause the Partnership to be treated as anything other than a partnership for purposes of United States income taxation and (ii) any amendment which would adversely affect the powers, preferences or special rights of any series of Preferred Securities may be effected only as permitted by the terms of such series of Preferred Securities. Section 12.2 Amendment of Certificate. In the event this ________________________ Agreement shall be amended pursuant to Section 12.1, the General Partner ____________ shall amend the Certificate to reflect such change if it deems such amendment of the Certificate to be necessary or appropriate. Section 12.3 Meetings of the Partners. ________________________ (a) Meetings of the Limited Partners who are Holders of any series or, in the case of a class vote, of multiple series of Preferred Securities may be called at any time by the General Partner (or as provided in any Action establishing a series of Preferred Securities) to consider and act on any matter on which Limited Partners are entitled to act under the terms of this Agreement or the Act. The General Partner shall call a meeting of Holders of any series or, in the case of a class vote, multiple series, if directed to do so by Holders of not less than 10% in liquidation preference of the Preferred Securities of that series. Such direction shall be given by delivering to the General Partner one or more calls in writing stating that the signing Limited Partners wish to call a meeting and indicating the general or specific purpose for which the meeting is to be called. Any Limited Partner calling a meeting shall specify the LP Certificates as to which the Limited Partners exercising the right to call a meeting and only those specified Interests shall be counted for purposes of determining whether the required percentage set forth in the proceeding sentence has been met. Except to the extent otherwise provided in any such Action, the following provisions shall apply to meetings of Partners. (b) Notice of any such meeting shall be given to all Limited Partners having a right to vote thereat not less than 7 Business Days nor more than 60 days prior to the date of such meeting. Whenever a vote, consent or approval of Limited Partners is permitted or required under this Agreement, such vote, consent or approval may be given at a meeting of Limited Partners. Further, any action that may be taken at a meeting of the Limited Partners may be taken without a meeting if a consent in writing setting forth the action so taken is signed by Limited Partners owning not less than the minimum Interests that would be necessary to authorize or take such action at a meeting at which all Limited Partners having a right to vote thereon were present and voting. Prompt notice of the taking of action without a meeting shall be given to the Limited Partners entitled to vote who have not consented in writing. The General Partner may specify that any written ballot submitted to the Limited Partners for the purpose of taking any action without a meeting shall be returned to the Partnership within the time specified by the General Partner. (c) Each Limited Partner may authorize any Person to act for it by proxy on all matters in which a Limited Partner is entitled to participate, including waiving notice of any meeting, or voting or participating at a meeting. No proxy shall be valid after the expiration of 11 months from the date thereof unless otherwise provided in the proxy. Every proxy shall be revocable at the pleasure of the Limited Partner executing it. Except as otherwise provided herein, in any Action or pursuant to Section 12.3(e), all matters relating to the giving, voting or _______________ validity of proxy shall be 22 governed by the General Corporation Law of the State of Delaware relating to proxies, and judicial interpretations thereunder, as if the Partnership were a Delaware corporation and the Limited Partners were stockholders of a Delaware corporation. (d) Each meeting of Partners shall be conducted by the General Partner or by such other Person that the General Partner may designate. (e) The General Partner, in its sole discretion, shall establish all other provisions relating to meetings of Limited Partners, including notice of the time, place or purpose of any meeting at which any matter is to be voted on by any Limited Partners, waiver of any such notice, action by consent without a meeting, the establishment of a record date, quorum requirements, voting in person or by proxy or any other matter with respect to the exercise of any such right to vote. ARTICLE XIII MISCELLANEOUS Section 13.1 Notices. All notices provided for in this _______ Agreement shall be in writing, duly signed by the party giving such notice, and shall be delivered, telecopied or mailed by registered or certified mail, as follows: (a) if given to the Partnership, in care of the General Partner at the Partnership's mailing address set forth below: PacifiCorp Delaware, L.P. c/o PacifiCorp 700 NE Multnomah, Suite 1600 Portland, Oregon 97232 Attention: (b) if given to the General Partner, at its mailing address set forth below: PacifiCorp 700 NE Multnomah, Suite 1600 Portland, Oregon 97232 Attention: Richard T. O'Brien, Vice President (c) if given to any other Partner at the address set forth on the books and records of the Partnership. All such notices shall be deemed to have been given when received. Section 13.2 Entire Agreement. This Agreement constitutes the ________________ entire agreement among the parties. It supersedes any prior agreement or understandings among them, and it may not be modified or amended in any manner other than as set forth herein. Section 13.3 Governing Law. This Agreement and the rights of _____________ the parties hereunder shall be governed by and interpreted in accordance with the law of the State of Delaware and all rights and remedies shall be governed by such laws without regard to principles of conflict of laws. Section 13.4 Effect. Except as herein otherwise specifically ______ provided, this Agreement shall be binding upon and inure to the benefit of the parties and their legal representatives, successors and assigns. 23 Section 13.5 Pronouns and Number. Wherever from the context ___________________ it appears appropriate, each term stated in either the singular or the plural shall include the singular and the plural, and pronouns stated in either the masculine, feminine or neuter shall include the masculine, feminine and neuter. Section 13.6 Partial Enforceability. If any provision of this ______________________ Agreement, or the application of such provision to any Person or circumstance, shall be held invalid, the remainder of this Agreement, or the application of such provision to persons or circumstances other than those to which it is held invalid, shall not be affected thereby. Section 13.7 Counterparts. This Agreement may contain more ____________ than one counterpart of the signature page and this Agreement may be executed by the affixing of the signature of each of the Partners to one of such counterpart signature pages. All of such counterpart signatures pages shall be read as though one, and they shall have the same force and effect as though all of the signers had signed a single signature page. Section 13.8 Waiver of Partition. Each Partner hereby ___________________ irrevocably waives any and all rights (if any) that such Partner may have to maintain any action for partition of any of the Partnership's property. Section 13.9 Remedies. The failure of any party to seek ________ redress for violation of, or to insist upon the strict performance of, any provision of this Agreement shall not prevent a subsequent act, which would have originally constituted a violation, from having the effect of an original violation. The rights and remedies provided by this Agreement are cumulative and the use of any one right or remedy by any party shall not preclude or waive its right to use any or all other remedies. Said rights and remedies are given in addition to any other rights the parties may have by law, statute, ordinance or otherwise. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above stated. General Partner: PACIFICORP, an Oregon corporation By: ___________________________________ Name: Title: Initial Limited Partner: PACIFICORP PREFERRED CAPITAL, INC., a Delaware corporation By: ___________________________________ Name: Title: 24 Annex A Certificate Number Number of Preferred Securities ___________________________________________________ R-1 CUSIP NO. Certificate Evidencing Preferred Securities of PacifiCorp Delaware, L.P. ___% Cumulative Monthly Income Preferred Securities, Series __ (liquidation preference $___ per Preferred Security) PacifiCorp Delaware, L.P., a limited partnership formed under the laws of the State of Delaware ( the "Partnership"), hereby certifies ___________ that ______________________ (the "Holder") is the registered owner of ______ _______ (______) Preferred Securities of the Partnership representing limited partner interests in the Partnership of a series designated the ____% Cumulative Monthly Income Preferred Securities, Series __ (liquidation preference $___ per Preferred Security) (the "Series ________ Preferred Securities"). The Series __ Preferred Securities are fully paid ____________________ and nonassessable limited partner interests in the Partnership, as to which the limited partners in the Partnership who hold the Series __ Preferred Securities (the "Preferred Security Holders"), in their capacities as __________________________ limited partners in the Partnership, will, assuming such Preferred Security Holders do not participate in the control of the business of the Partnership, have no liability solely by reason of being Preferred Security Holders in excess of their share of the Partnership's assets and undistributed profits (subject to the obligation of a Preferred Security Holder to repay any funds wrongfully distributed to it) and are transferable on the books and records of the Partnership, in person or by a duly authorized attorney, upon surrender of this certificate duly endorsed and in proper form for transfer. The powers, preferences and special rights and limitations of the Series __ Preferred Securities are set forth in, and this certificate and the Series Preferred Securities represented hereby are issued and shall in all respects be subject to the terms and provisions of, the Amended and Restated Agreement of Limited Partnership of the Partnership dated as of _____________, 1994, as the same may be amended from time to time (the "Limited Partnership Agreement") authorizing the _____________________________ issuance of the Series __ Preferred Securities and determining the powers, preferences, and other special rights and limitations, regarding Dividends, voting, return of capital and otherwise, and other matters relating to the Series __ Preferred Securities. Capitalized terms used herein but not defined shall have the meaning given them in the Limited Partnership Agreement. The Holder is entitled to the benefits of the Guarantee Agreement of PacifiCorp, an Oregon corporation ("PacifiCorp"), dated as of __________ _________, 1994 (the "Guarantee") to the extent provided therein. The _________ Partnership will furnish a copy of the Limited Partnership Agreement and the Guarantee to the Holder without charge upon written request to the Partnership at its principal place of business or registered office. The Holder, by accepting this certificate, is deemed to have agreed that (i) the Series __ Junior Subordinated Debentures acquired by the Partnership with the proceeds from the issuance of the Series __ Preferred Security are subordinated and junior in right of payment to all Senior Indebtedness of PacifiCorp as and to the extent provided in the Indenture, and (ii) the Guarantee ranks subordinate and junior in right of payment to all liabilities of PacifiCorp, pari passu with the most senior preferred or preference stock now or hereafter issued by PacifiCorp and with any guarantee now or hereafter issued by PacifiCorp in respect of any preferred or preference stock of any Affiliate of PacifiCorp, and senior to PacifiCorp's common stock, as and to the extent provided in the Guarantee. Upon receipt of this certificate, the Holder is admitted to the Partnership as a limited partner of the Partnership, is bound by the Limited Partnership Agreement and is entitled to the benefits thereunder. IN WITNESS WHEREOF, the Partnership has executed this certificate this day of ____________, 199__. PACIFICORP DELAWARE, L.P. By: PACIFICORP, its General Partner By: ___________________________________ 2 EX-4 6 EXHIBIT (4)(h) ACTION BY THE GENERAL PARTNER OF PACIFICORP DELAWARE, L.P. CREATING THE ___% CUMULATIVE MONTHLY INCOME PREFERRED SECURITIES, SERIES A Pursuant to Section 6.2 of the Amended and Restated Agreement of Limited Partnership, dated as of _______________, 1994 (as amended from time to time, the "Partnership Agreement"), PacifiCorp, an Oregon corporation, as general partner (the "General Partner") of PacifiCorp Delaware, L.P. (the "Partnership"), desiring to establish the number, voting powers, designation, preferences, participation, optional or other special rights and the qualifications, limitations, or restrictions of, and other matters relating to, an initial series of Preferred Securities, hereby authorizes and establishes such initial series of Preferred Securities according to the following terms and conditions (each capitalized term used but not defined herein shall have the meaning set forth in the Partnership Agreement): (a) Designation. ________________ (_______) ___________ Preferred Securities, liquidation preference $25 per Preferred Security, are hereby designated as "____% Cumulative Monthly Income Preferred Securities, Series A" (hereinafter called the "Series A Preferred Securities"). _____________________________ (b) Dividends. _________ (i) The Limited Partners who hold the Series A Preferred Securities shall be entitled to receive, when, as and if available and determined to be so distributed by the General Partner (the General Partner's discretion to be subject to paragraph (b)(ii)), cumulative cash _________________ Dividends at a rate per annum of ___% of the stated liquidation preference of $25 per Preferred Security, calculated on the basis of a 360-day year of twelve 30-day months, and payable in United States dollars monthly in arrears on the last day of each calendar month of each year, commencing ________, 1994. Such Dividends will accrue and be cumulative whether or not they have been declared and whether or not there are funds of the Partnership legally available for the payment of Dividends. Dividends on the Series A Preferred Securities shall be cumulative from the date of original issue, and the cumulative portion from such date to _______, 1994 shall be payable on _______, 1994. In the event that any date on which Dividends are payable on the Series A Preferred Securities is not a Business Day, then payment of the Dividend payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay) except that, if such Business Day is in the next succeeding calendar year, such payment shall be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such date. Accrued and unpaid Dividends will bear interest after the Dividend payment date therefor at the rate per annum of ___% thereof. (ii) Dividends on the Series A Preferred Securities must be paid on the date such Dividends are payable to the extent that the Partnership has, on the date such Dividends are payable, (x) funds legally available for the payment of such Dividends and (y) cash on hand sufficient to permit such payments. Dividends will be payable to the Preferred Security Holders as they appear on the books and records of the Partnership on the relevant record dates, which, as long as the Series A Preferred Securities remain in book-entry-only form, will be one Business Day prior to the relevant payment dates. In the event the Series A Preferred Securities shall not continue to remain in book-entry-only form, the General Partner shall have the right to select relevant record dates which shall be more than one Business Day prior to the relevant payment dates. (iii) The Partnership shall not: (A) pay, or set aside for payment, any Dividends with respect to any other Preferred Securities unless the amount of any Dividends declared on such other Preferred Securities is paid on such other Preferred Securities and the Series A Preferred Securities on a pro rata basis on the date such Dividends are paid on such other Preferred Securities, so that (x) the aggregate amount of Dividends paid on the Series A Preferred Securities bears to the aggregate amount of Dividends paid on such other Preferred Securities the same ratio as (y) the aggregate of all accrued and unpaid Dividends in respect of the Series A Preferred Securities bears to the aggregate of all accrued and unpaid Dividends in respect of such other Preferred Securities; or (B) redeem, purchase or otherwise acquire any other Preferred Securities; 2 until, in the case of clauses (A) and (B), such time as all accrued and unpaid Dividends on the Series A Preferred Securities shall have been paid in full for all Dividend periods terminating on or prior to, in the case of clause (A), such payment and, in the case of clause (B), the date of such redemption, purchase or acquisition. (c) Redemption; Tax Event Distribution. __________________________________ (i) The Series A Preferred Securities are redeemable, at the option of the Partnership, in whole or in part from time to time, on or after ________, 1999, upon not less than 30 nor more than 60 days' notice, at the Redemption Price (as hereinafter defined). If a partial redemption would result in a delisting of the Series A Preferred Securities, the Partnership may only redeem the Series A Preferred Securities in whole. (ii) Upon any redemption or repayment of the ___% Deferrable Interest Junior Subordinated Debentures, Series A, due 2034 issued by PacifiCorp ("Series A Junior Subordinated Debentures") at maturity or earlier, the proceeds from such redemption or repayment shall be applied to redeem the Series A Preferred Securities, in whole or in part, at the redemption price of $25 per Preferred Security plus accumulated and unpaid Dividends (whether or not declared) to the date fixed for redemption (the "Redemption Price") upon not less than 30 nor more ________________ than 60 days' notice. (iii) If a Tax Event shall occur and be continuing, the General Partner shall dissolve the Partnership and, subject to Section 11.4 of the ____________ Partnership Agreement, cause to be distributed to Series A Preferred Security Holders in liquidation of the Partnership, within 90 days following the occurrence of such Tax Event, Series A Junior Subordinated Debentures having a principal amount equal to the aggregate liquidation preference of the outstanding Series A Preference Securities and with accrued and unpaid interest in an amount equal to any unpaid Dividends on the Series A Preferred Securities; provided, however, that (A) the Partnership shall be required to obtain an opinion of counsel (which may be regular tax counsel to PacifiCorp or an Affiliate, but not an employee thereof) to the effect that the holders of the Series A Preferred Securities will not recognize any gain or loss for federal income tax purposes as a result of such dissolution and distribution of Series A Junior Subordinated Debentures and (B) the General Partner may elect to cause the Series A Preferred Securities to remain outstanding. 3 After the date fixed for any distribution of Series A Junior Subordinated Debentures upon dissolution of the Partnership, (i) the Series A Preferred Securities will no longer be deemed to be outstanding, (ii) DTC or its nominee, as the record Holder of the Series A Preferred Securities, will return the registered global certificate or certificates representing the Series A Preferred Securities and will receive a registered global certificate or certificates representing the Series A Junior Subordinated Debentures to be delivered upon such distribution and (iii) any certificates representing Series A Preferred Securities not held by DTC or its nominee will be deemed to represent Series A Junior Subordinated Debentures having a principal amount and accrued and unpaid interest equal to the aggregate of the stated liquidation preference of, and accrued and unpaid Dividends on, such Series A Preferred Securities until such certificates are presented to the General Partner or its agent for transfer or reissuance. (d) Redemption Procedures. _____________________ (i) Notice of any redemption (a "Notice of _________ Redemption") of the Series A Preferred Securities will be __________ given by the Partnership by mail to each record Holder to be redeemed not fewer than 30 nor more than 60 days prior to the date fixed for redemption thereof. For purposes of the calculation of the date of redemption and the dates on which notices are given pursuant to this paragraph (d)(i), ________________ a Notice of Redemption shall be deemed to be given on the day such notice is first mailed by first-class mail, postage prepaid, to Preferred Security Holders who hold Series A Preferred Securities. Each Notice of Redemption shall be addressed to the Preferred Security Holders who hold Series A Preferred Securities at the address of the Holder appearing in the books and records of the Partnership. No defect in the Notice of Redemption or in the mailing thereof or publication of its contents shall affect the validity of the redemption proceedings. (ii) In the event that fewer than all the outstanding Series A Preferred Securities are to be redeemed, the Series A Preferred Securities to be redeemed in the case of a redemption pursuant to paragraph (c)(i) ________________ will be selected in accordance with paragraph _________ (d)(iv) hereof. The Partnership may not redeem fewer ________ than all the outstanding Series A Preferred Securities unless all accrued and unpaid Dividends have been paid on all Series A Preferred Securities for all monthly Dividend periods terminating on or prior to the date of redemption. (iii) If the Partnership gives a Notice of Redemption in respect of Series A Preferred Securities, then, (A) by 12:00 noon, New York time, on the redemption 4 date in the case of Clauses (I) and (II) below or ___________ ____ (B) prior to the close of business on the Business Day immediately preceding the redemption date in the case of Clause (III) below, the Partnership will irrevocably ____________ deposit with (I) DTC, if DTC is the Clearing Agency on the date such Notice of Redemption is given, (II) such other Person which is the Clearing Agency on the date such Notice of Redemption is given or (III) if there is no Clearing Agency with respect to the Preferred Securities on the date such Notice of Redemption is given, the Paying Agent or Paying Agents appointed by the General Partner pursuant to Section 10.7 of the Partnership Agreement, ____________ funds sufficient to pay the applicable Redemption Price and will give DTC, such other Clearing Agency or the Paying Agent or Paying Agents, as the case may be, irrevocable instructions and authority to pay the Redemption Price to the Holders of the Series A Preferred Securities. If Notice of Redemption shall have been given and funds deposited as required, then upon the date of such deposit, all rights of the Preferred Security Holders who hold such Series A Preferred Securities so called for redemption will cease, except the right of the Holders of such securities to receive the Redemption Price, but without interest on such Redemption Price. In the event that any date fixed for redemption of Series A Preferred Securities is not a Business Day, then payment of the Redemption Price payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay), except that, if such Business Day falls in the next calendar year, such payment will be made on the immediately preceding Business Day. In the event that payment of the Redemption Price in respect of Series A Preferred Securities is improperly withheld or refused and not paid either by the Partnership or by PacifiCorp pursuant to the Guarantee, Dividends on such Series A Preferred Securities will continue to accrue at the then applicable rate, from the original redemption date to the date of payment, in which case the actual payment date will be considered the date fixed for redemption for purposes of calculating the Redemption Price. (iv) Redemption notices shall be sent to (A) Cede & Co. or any successor nominee of DTC, in either case so long as DTC is the Clearing Agency, (B) the nominee of any Clearing Agency other than DTC or (C) any Paying Agent or Paying Agents appointed by the General Partner pursuant to Section 10.7 of the Partnership ____________ Agreement. If less than all of the Series A Preferred Securities are being redeemed, interests to be redeemed shall be determined as follows: (x) in accordance with DTC's practice, so long as DTC is the Clearing Agency, (y) in accordance with the practice of any other Clearing 5 Agency or (z) if, at the time such redemption notice is sent, there is no Clearing Agency, the Paying Agent or Paying Agents shall select, by lot or in such other manner as the Paying Agent or Paying Agents shall deem appropriate and fair, in their discretion, the Preferred Securities to be redeemed. (e) Liquidation Distribution. In the event of any ________________________ voluntary or involuntary dissolution, winding up or termination of the Partnership, Preferred Security Holders who hold the Series A Preferred Securities at the time will be entitled to receive out of the assets of the Partnership available for distribution to Partners after satisfaction of liabilities of creditors as required by the Act, before any distribution of assets is made to the General Partner, but together with the Holders of every other series of Preferred Securities outstanding, if any, an amount equal to, in the case of Holders of Series A Preferred Securities, the aggregate of the stated liquidation preference of $25 per Preferred Security and accrued and unpaid Dividends thereon (whether or not declared) to the date of payment (the "Liquidation Distribution"), unless ________________________ in connection with such dissolution, winding up or termination, Series A Junior Subordinated Debentures in an aggregate principal amount equal to the aggregate of the stated liquidation preference of $25 per Preferred Security of all Series A Preferred Securities then outstanding with accrued and unpaid interest in an amount equal to any unpaid Dividends on the Series A Preferred Securities have been distributed on a pro rata basis to the Holders of the Series A Preferred Securities. If, upon any such liquidation, the Liquidation Distribution can be paid only in part because the Partnership has insufficient assets available to pay in full the aggregate Liquidation Distribution and the aggregate maximum liquidation distributions on any other series of Preferred Securities, then the amounts payable directly by the Partnership on the Series A Preferred Securities and on such other series of Preferred Securities shall be paid on a pro rata basis, so that (i) the aggregate amount paid in respect of the Liquidation Distribution bears to the aggregate amount paid as liquidation distributions on such other series of Preferred Securities the same ratio as (ii) the aggregate Liquidation Distribution bears to the aggregate maximum liquidation distributions on such other series of Preferred Securities. (f) Voting Rights. If (i) the Partnership fails to _____________ pay Dividends in full on the Series A Preferred Securities for 18 consecutive monthly Dividend periods, (ii) an event of default occurs and is continuing on the Series A Junior 6 Subordinated Debentures or (iii) PacifiCorp is in default on any of its payment or other obligations under the Guarantee, then the Holders of the Series A Preferred Securities, together with the Holders of any other series of Preferred Securities having the right to vote for the appointment of a Special Representative in such event, acting as a single class, will be entitled by the majority vote of such Holders to appoint and authorize a Special Representative to enforce the Partnership's creditor rights under the Junior Subordinated Debentures, enforce the rights of the Series A Preferred Security Holders under the Guarantee and enforce the rights of the Preferred Security Holders to receive Dividends on Preferred Securities, PacifiCorp agreeing to execute and deliver such documents as may be necessary, appropriate or convenient for the Special Representative to enforce such rights and obligations. In furtherance of the foregoing, and without limiting the powers of any Special Representative so appointed and for the avoidance of any doubt concerning the powers of the Special Representative, any Special Representative, in its own name, in the name of the Partnership, in the name of the Series A Preferred Security Holders or otherwise, may institute or cause to be instituted a proceeding, including, without limitation, any suit in equity, an action at law or other judicial or administrative proceeding, to enforce the Partnership's or the Series A Preferred Security Holders' rights directly against PacifiCorp, or any other obligor in connection with such obligations on behalf of the Partnership or the Series A Preferred Security Holders, and may prosecute such proceeding to judgment or final decree, and enforce the same against PacifiCorp or any other obligor in connection with such obligations and collect, out of the property, wherever situated, of PacifiCorp or any such other obligor upon such obligations, the monies adjudged or decreed to be payable in the manner provided by law. The Special Representative shall not by virtue of acting in such capacity be admitted as a general partner in the Partnership or otherwise be deemed to be a general partner in the Partnership and shall have no liability for the debts, obligations or liabilities of the Partnership. For purposes of determining whether the Partnership has failed to pay Dividends in full for 18 consecutive monthly Dividend periods, Dividends shall be deemed to remain in arrears, notwithstanding any payments in respect thereof, until full cumulative Dividends have been or contemporaneously are declared and paid with respect to all monthly Dividend periods terminating on or prior to the date of payment of such full cumulative Dividends. Not later than 30 days after such right to appoint a Special Representative arises, the General Partner will convene a meeting for the purpose of appointing a Special Representative. If the General Partner fails to convene such meeting within such 30-day period, the Holders of 10% in 7 liquidation preference of the outstanding Preferred Securities will be entitled to convene such meeting. The provisions of Section 12.3 of the Partnership Agreement relating to the ____________ convening and conduct of meetings of the Partners will apply with respect to any such meeting. Any Special Representative so appointed shall cease to be a representative of the Partnership and the Limited Partners if the Partnership (or PacifiCorp pursuant to the Guarantee) shall have paid in full all accumulated and unpaid Dividends on the Preferred Securities or such default or breach, as the case may be, shall have been cured, and PacifiCorp, as the general partner of the Partnership, is hereby authorized to and shall continue the business of the Partnership without dissolution. Notwithstanding the appointment of any such Special Representative, PacifiCorp retains all rights under the Indenture, including the right to extend the interest payment period, and shall continue to be a general partner in the Partnership. If any proposed amendment of this Action provides for, or the General Partner otherwise proposes to effect (pursuant to an Action or otherwise), (x) any action which would adversely affect the powers, preferences or special rights of the Series A Preferred Securities, whether by way of amendment of this Action or otherwise (including, without limitation, the authorization or issuance of any interests ranking, as to participation in the profits and Dividends or in the assets of the Partnership, senior or junior to the Series A Preferred Securities), or (y) the dissolution, winding up or termination of the Partnership, other than (A) a dissolution, winding up or termination in connection with which the Partnership distributes the Series A Junior Subordinated Debentures to the Series A Security Holders upon the occurrence of a Tax Event or (B) as described in paragraph (g) below, then _____________ the Series A Preferred Security Holders will be entitled to vote on such amendment or proposal of the General Partner (but not on any other amendment or proposal) as a class with all other Holders of Preferred Securities similarly affected, and such amendment or proposal shall not be effective except with the approval of Holders of 66-2/3% in liquidation preference of such outstanding Preferred Securities; provided, however, that ________ _______ no such approval shall be required if the dissolution, winding up or termination of the Partnership is proposed or initiated pursuant to Section 11.2 of the Partnership Agreement or upon ____________ the initiation of proceedings, or after proceedings have been initiated, for the dissolution, winding up or termination of PacifiCorp. The rights attached to the Series A Preferred Securities will be deemed not to be adversely affected by the creation or issue of, and no vote will be required for the creation of, any further Preferred Securities ranking pari passu with the Series A Preferred Securities with regard to 8 participation in the profits and Dividends or in the assets of the Partnership. Any required approval of Holders of Series A Preferred Securities may be given at a separate meeting of such Holders convened for such purpose, at a meeting of all of the Partners or pursuant to written consent. The Partnership will cause a notice of any meeting at which Limited Partners holding Series A Preferred Securities are entitled to vote, or of any matter upon which action by written consent of such Holders is to be taken, to be mailed to each Holder of Series A Preferred Securities. Each such notice will include a statement setting forth (i) the date of such meeting or the date by which such action is to be taken, (ii) a description of any matter on which such Holders are entitled to vote or upon which written consent is sought and (iii) instructions for the delivery of proxies or consents. No vote or consent of the Holders of Series A Preferred Securities will be required for the Partnership to redeem and cancel Series A Preferred Securities in accordance with this Action. Notwithstanding that Holders of Series A Preferred Securities are entitled to vote or consent under any of the circumstances described above, any of the Series A Preferred Securities and any other series of Preferred Securities that are entitled to vote or consent with such Series A Preferred Securities as a single class at such time that are owned by PacifiCorp or any Person owned more than 50% by PacifiCorp, either directly or indirectly, shall not be entitled to vote or consent and shall, for the purposes of such vote or consent, be treated as if they were not outstanding. (g) Mergers. The Partnership shall not consolidate, _______ amalgamate, merge with or into, or be replaced by, or convey, transfer or lease its properties and assets substantially as an entirety to any Person, except as described below. The Partnership may, without the consent of the Holders of the Series A Preferred Securities, consolidate, amalgamate, merge with or into, or be replaced by a limited partnership, a limited liability company or a trust organized as such under the laws of any state of the United States of America; provided, that (i) such successor entity either (x) expressly assumes all of the obligations of the Partnership under the Series A Preferred Securities or (y) substitutes for the Series A Preferred Securities other securities having substantially the same terms as the Series A Preferred Securities (the "Successor Securities") so long as the ____________________ Successor Securities rank, with respect to participation in the profits and Dividends or in the assets of the successor entity, at least as high as the Series A Preferred Securities rank with respect to participation in the profits and Dividends or in the assets of the Partnership, (ii) PacifiCorp expressly acknowledges such successor entity as the Holder of the 9 Series A Junior Subordinated Debentures, (iii) the Series A Preferred Securities or the Successor Securities are listed, or will be listed on notification of issuance, on any national securities exchange or other organization on which the Series A Preferred Securities are then listed, (iv) such merger, consolidation, amalgamation or replacement does not cause the Series A Preferred Securities (or the Successor Securities) to be downgraded by any nationally recognized statistical rating organization, as that term is defined by the Securities and Exchange Commission for purposes of Rule 436(g)(2) under the Securities Act, (v) such merger, consolidation, amalgamation or replacement does not adversely affect the powers, preferences and special rights of Holders of Series A Preferred Securities (including any Successor Securities) in any material respect, (vi) such successor entity has a purpose substantially identical to that of the Partnership and (vii) prior to such merger, consolidation, amalgamation or replacement, PacifiCorp has received an opinion of nationally recognized independent counsel to the Partnership experienced in such matters to the effect that (x) such successor entity will be treated as a partnership for Federal income tax purposes, (y) following such merger, consolidation, amalgamation or replacement, PacifiCorp and such successor entity will be in compliance with the 1940 Act without registering thereunder as an investment company, and (z) such merger, consolidation, amalgamation or replacement will not adversely affect the limited liability of Holders of Series A Preferred Securities. IN WITNESS WHEREOF, the General Partner has executed this Action as of this _____ day of ______________, 1994. GENERAL PARTNER: PACIFICORP, an Oregon corporation By: _____________________________ Name: _______________________ Title: ______________________ 10 EX-4 7 EXHIBIT (4)(i) ACTION BY THE GENERAL PARTNER OF PACIFICORP DELAWARE, L.P. CREATING THE CUMULATIVE ADJUSTABLE RATE MONTHLY INCOME PREFERRED SECURITIES, SERIES A Pursuant to Section 6.2 of the Amended and Restated Agreement of Limited Partnership, dated as of _______________, 1994 (as amended from time to time, the "Partnership ___________ Agreement"), PacifiCorp, an Oregon corporation, as general _________ partner (the "General Partner") of PacifiCorp Delaware, L.P. _______________ (the "Partnership"), desiring to establish the number, voting ___________ powers, designation, preferences, participation, optional or other special rights and the qualifications, limitations, or restrictions of, and other matters relating to, an initial series of Preferred Securities, hereby authorizes and establishes such new series of Preferred Securities according to the following terms and conditions (each capitalized term used but not defined herein shall have the meaning set forth in the Partnership Agreement): (a) Designation. ________________ (_______) ___________ Preferred Securities, liquidation preference $25 per Preferred Security, are hereby designated as "Cumulative Adjustable Rate Monthly Income Preferred Securities, Series A" (hereinafter called the "Series A Preferred Securities"). _____________________________ (b) Dividends. _________ (i) The Limited Partners who hold the Series A Preferred Securities shall be entitled to receive, when, as and if available and determined to be so distributed by the General Partner (the General Partner's discretion to be subject to paragraph (b)(ii)), cumulative cash _________________ Dividends accruing from the date of original issue and payable in United States dollars monthly in arrears on the last day of each calendar month of each year, commencing _______________, 1994. The amount of Dividends payable for any period will be calculated on the basis of a 360-day year of twelve 30-day months. The Dividend rate will be adjusted quarterly. The rate for the initial period from the date of initial issuance to _____________, 1994 will be _____% per annum. Thereafter, Dividends on the Series A Preferred Securities will be payable at the "Applicable Rate" (as defined below) from time to time in _______________ effect. Such Dividends will accrue and be cumulative whether or not they have been declared and whether or not there are funds of the Partnership legally available for the payment of Dividends. Dividends on the Series A Preferred Securities shall be cumulative from the date of original issue, and the cumulative portion from such date to _______, 1994 shall be payable on _______, 1994. In the event that any date on which Dividends are payable on the Series A Preferred Securities is not a Business Day, then payment of the Dividend payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay) except that, if such Business Day is in the next succeeding calendar year, such payment shall be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such date. Accrued and unpaid Dividends will bear interest after the Dividend payment date therefor at the rate per annum equal to the Dividend rate during the period of arrearage. (A) Except as provided below in this paragraph, the "Applicable Rate" for any quarter (other than the initial period) will be equal to ____% of the Effective Rate (as defined below), but not less than ____% per annum nor more than ____% per annum. The "Effective Rate" for any quarter will be equal to the highest of the Treasury Bill Rate, the Ten Year Constant Maturity Rate and the Thirty Year Constant Maturity Rate (each as defined below) for such quarter. The Applicable Rate will be rounded to the nearest five hundredths of a percent. In the event that the Partnership determines in good faith that for any reason: (x) any one of the Treasury Bill Rate, the Ten Year Constant Maturity Rate or the Thirty Year Constant Maturity Rate cannot be determined for any quarter, then the Effective Rate for such quarter will be equal to the higher of whichever two of such rates can be so determined. (y) only one of the Treasury Bill Rate, the Ten Year Constant Maturity Rate and the Thirty Year Constant Maturity Rate can be determined for any quarter, then the Effective Rate for such quarter will be equal to whichever such rate can be so determined; or (z) none of the Treasury Bill Rate, the Ten Year Constant Maturity Rate and the Thirty Year Constant Maturity Rate can be determined for any quarter, then the Effective Rate for the preceding quarter will be continued for such quarter. 2 (B) Except as described below in this paragraph, the "Treasury Bill Rate" for each quarter will be the arithmetic average of the two most recent weekly per annum secondary market discount rates (or the one weekly per annum secondary market discount rate, if only one such rate is published during the relevant Calendar Period (as defined below)) for three-month U.S. Treasury bills, as published weekly by the Federal Reserve Board (as defined below) during the Calendar Period immediately preceding the last ten calendar days preceding the quarter for which the dividend rate on the Series A Preferred Securities is being determined. In the event that the Federal Reserve Board does not publish such a weekly per annum secondary market discount rate during any such Calendar Period, then the Treasury Bill Rate for such quarter will be the arithmetic average of the two most recent weekly per annum secondary market discount rates (or the one weekly per annum secondary market discount rate, if only one such rate is published during the relevant Calendar Period) for three-month U.S. Treasury bills, as published weekly during such Calendar Period by any Federal Reserve Bank or by any U.S. Government department or agency selected by the Partnership. In the event that a per annum secondary market discount rate for three-month U.S. Treasury bills is not published by the Federal Reserve Board or by any Federal Reserve Bank or by any U.S. Government department or agency during such Calendar Period, then the Treasury Bill Rate for such quarter will be the arithmetic average of the two most recent weekly per annum secondary market discount rates (or the one weekly per annum secondary market discount rate, if only one such rate is published during the relevant Calendar Period) for all of the U.S. Treasury bills then having remaining maturities of not less than 80 nor more than 100 days, as published during such Calendar Period by the Federal Reserve Board, or if the Federal Reserve Board does not publish such rates, by any Federal Reserve Bank or by any U.S. Government department or agency selected by the Partnership. In the event that the Partnership determines in good faith that for any reason no such U.S. Treasury bill rates are published as provided above during such Calendar Period, then the Treasury Bill Rate for such quarter will be the arithmetic average of the per annum secondary market discount rates based upon the closing bids during such Calendar Period for each of the issues of marketable non-interest-bearing U.S. Treasury securities with a remaining maturity of not less than 80 nor more than 100 days from the date of each such quotation, as 3 chosen and quoted daily for each business day in New York City (or less frequently if daily quotations are not generally available) to the Partnership by at least three recognized dealers in U.S. Government securities selected by the Partnership. In the event that the Partnership determines in good faith that for any reason the Partnership cannot determine the Treasury Bill Rate for any quarter as provided above in this paragraph, the Treasury Bill Rate for such quarter will be the arithmetic average of the per annum secondary market discount rate based upon the closing bids during such Calendar Period for each of the issues of marketable interest-bearing U.S. Treasury securities with a remaining maturity of not less than 80 nor more than 100 days, as chosen and quoted daily for each business day in New York City (or less frequently if daily quotations are not generally available) to the Partnership by at least three recognized dealers in U.S. Government securities selected by the Partnership. (C) Except as described below in this paragraph, the "Ten Year Constant Maturity Rate" for each quarter will be the arithmetic average of the two most recent weekly per annum Ten Year Average Yields (as defined below) (or the one weekly per annum Ten Year Average Yield, if only one such yield is published during the relevant Calendar Period), as published weekly by the Federal Reserve Board during the Calendar Period immediately preceding the last ten calendar days preceding the quarter for which the dividend rate on the Series A Preferred Securities is being determined. In the event that the Federal Reserve Board does not publish such a weekly per annum Ten Year Average Yield during such Calendar Period, then the Ten Year Constant Maturity Rate for such quarter will be the arithmetic average of the two most recent weekly per annum Ten Year Average Yields (or the one weekly per annum Ten Year Average Yield, if only one such yield is published during the relevant Calendar Period), as published weekly during such Calendar Period by any Federal Reserve Bank or by any U.S. Government department or agency selected by the Partnership. In the event that a per annum Ten Year Average Yield is not published by the Federal Reserve Board or by the Federal Reserve Bank or by any U.S. Government department or agency during such Calendar Period, then the Ten Year Constant Maturity Rate for such quarter will be the arithmetic average of the two most recent weekly per annum average yields to maturity (or the one weekly per annum average yield to maturity, if only one such yield is published during the relevant Calendar 4 Period) for all of the actively traded marketable U.S. Treasury fixed interest rate securities (other than Special Securities (as defined below)) then having remaining maturities of not less than eight nor more than twelve years, as published during such Calendar Period by the Federal Reserve Board or, if the Federal Reserve Board does not publish such yields, by any Federal Reserve Bank or by any U.S. Government department or agency selected by the Partnership. In the event that the Partnership determines in good faith that for any reason the Partnership cannot determine the Ten Year Constant Maturity Rate for any quarter as provided above in this paragraph, then the Ten Year Constant Maturity Rate for such quarter will be the arithmetic average of the per annum average yields to maturity based upon the closing bids during such Calendar Period for each of the issues of actively traded marketable U.S. Treasury fixed interest rate securities (other than Special Securities) with a final maturity date not less than eight or more than twelve years from the date of each such quotation, as chosen and quoted daily for each business day in New York City (or less frequently if daily quotations are not generally available) to the Partnership by at least three recognized dealers in U.S. Government securities selected by the Partnership. (D) Except as described below in this paragraph, the "Thirty Year Constant Maturity Rate" for each quarter will be the arithmetic average of the two most recent weekly per annum Thirty Year Average Yields (as defined below) (or the one weekly per annum Thirty Year Average Yield, if only one such yield is published during the relevant Calendar Period), as published weekly by the Federal Reserve Board during the Calendar Period immediately preceding the last ten calendar days preceding the quarter for which the dividend rate on the Series A Preferred Securities is being determined. In the event that the Federal Reserve Board does not publish such a weekly per annum Thirty Year Average Yield during such Calendar Period, then the Thirty Year Constant Maturity Rate for such quarter will be the arithmetic average of the two most recent weekly per annum Thirty Year Average Yields (or the one weekly per annum Thirty Year Average Yield, if only one such yield is published during the relevant Calendar Period), as published weekly during such Calendar Period by any Federal Reserve Bank or by any U.S. Government department or agency selected by the Partnership. In the event that a per annum Thirty Year Average Yield is not published by the Federal 5 Reserve Board or by any Federal Reserve Bank or by any U.S. Government department or agency during such Calendar Period, then the Thirty Year Constant Maturity Rate for such quarter will be the arithmetic average of the two most recent weekly per annum average yields to maturity (or the one weekly per annum average yield to maturity, if only one such yield is published during the relevant Calendar Period) for all of the actively traded marketable U.S. Treasury fixed interest rate securities (other than Special Securities) then having remaining maturities of not less than twenty-eight nor more than thirty-two years, as published during such Calendar Period by the Federal Reserve Board or, if the Federal Reserve Board does not publish such yields, by any Federal Reserve Bank or by any U.S. Government department or agency selected by the Partnership. In the event that the Partnership determines in good faith that for any reason the Partnership cannot determine the Thirty Year Constant Maturity Rate for any quarter as provided above in this paragraph, then the Thirty Year Constant Maturity Rate for such quarter will be the arithmetic average of the per annum average yields to maturity based upon the closing bids during such Calendar Period for each of the issues of actively traded marketable U.S. Treasury fixed interest rate securities (other than Special Securities) with a final maturity date not less than twenty-eight nor more than thirty-two years from the date of each such quotation, as chosen and quoted daily for each business day in New York City (or less frequently if daily quotations are not generally available) to the Partnership by at least three recognized dealers in U.S. Government securities selected by the Partnership. (E) The Treasury Bill Rate, the Ten Year Constant Maturity Rate and the Thirty Year Constant Maturity Rate will each be rounded to the nearest one hundredth of a percent. (F) The Applicable Rate with respect to each quarter (other than the initial period) will be calculated as promptly as practicable by the Partnership according to the appropriate method described above. The Partnership will cause each Applicable Rate to be published in a newspaper of general circulation in New York City before the commencement of the quarter to which it applies and will cause notice of such Applicable Rate to be given to the securities depository for the Series A Preferred Securities, which currently is DTC. 6 (G) As used above, the term "Calendar ________ Period" means a period of fourteen calendar days; the ______ term "Federal Reserve Board" means the Board of _____________________ Governors of the Federal Reserve System; the term "Special Securities" means securities which can, at __________________ the option of the holder, be surrendered at face value in payment of any Federal estate tax or which provide tax benefits to the holder and are priced to reflect such tax benefits or which were originally issued at a deep or substantial discount; the term "Ten Year Average Yield" means the average yield to ______________________ maturity for actively traded marketable U.S. Treasury fixed interest rate securities adjusted to constant maturities of ten years; and the term "Thirty Year ___________ Average Yield" means the average yield to maturity _____________ for actively traded marketable U.S. Treasury fixed interest rate securities adjusted to constant maturities of thirty years. (ii) Dividends on the Series A Preferred Securities must be paid on the date such Dividends are payable to the extent that the Partnership has, on the date such Dividends are payable, (x) funds legally available for the payment of such Dividends and (y) cash on hand sufficient to permit such payments. Dividends will be payable to the Preferred Security Holders as they appear on the books and records of the Partnership on the relevant record dates, which, as long as the Series A Preferred Securities remain in book-entry-only form, will be one Business Day prior to the relevant payment dates. In the event the Series A Preferred Securities shall not continue to remain in book-entry-only form, the General Partner shall have the right to select relevant record dates which shall be more than one Business Day prior to the relevant payment dates. (iii) The Partnership shall not: (A) pay, or set aside for payment, any Dividends with respect to any other Preferred Securities unless the amount of any Dividends declared on such other Preferred Securities is paid on such other Preferred Securities and the Series A Preferred Securities on a pro rata basis on the date such Dividends are paid on such other Preferred Securities, so that (x) the aggregate amount of Dividends paid on the Series A Preferred Securities bears to the aggregate amount of Dividends paid on such other Preferred Securities the same ratio as 7 (y) the aggregate of all accrued and unpaid Dividends in respect of the Series A Preferred Securities bears to the aggregate of all accrued and unpaid Dividends in respect of such other Preferred Securities; or (B) redeem, purchase or otherwise acquire any other Preferred Securities; until, in the case of clauses (A) and (B), such time as all accrued and unpaid Dividends on the Series A Preferred Securities shall have been paid in full for all Dividend periods terminating on or prior to, in the case of clause (A), such payment and, in the case of clause (B), the date of such redemption, purchase or acquisition. (c) Redemption; Tax Event Distribution. __________________________________ (i) The Series A Preferred Securities are redeemable, at the option of the Partnership, in whole or in part from time to time, on or after ________, 1999, upon not less than 30 nor more than 60 days' notice, at the Redemption Price (as hereinafter defined). If a partial redemption would result in a delisting of the Series A Preferred Securities, the Partnership may only redeem the Series A Preferred Securities in whole. (ii) Upon any redemption or repayment of the ___% Deferrable Interest Junior Subordinated Debentures, Series A, due 2034 issued by PacifiCorp ("Series A Junior _______________ Subordinated Debentures") at maturity or earlier, the _______________________ proceeds from such redemption or repayment shall be applied to redeem the Series A Preferred Securities, in whole or in part, at the redemption price of $25 per Preferred Security plus accumulated and unpaid Dividends (whether or not declared) to the date fixed for redemption (the "Redemption Price") upon not less than 30 nor more ________________ than 60 days' notice. (iii) If a Tax Event shall occur and be continuing, the General Partner shall dissolve the Partnership and, subject to Section 11.4 of the ____________ Partnership Agreement, cause to be distributed to Series A Preferred Security Holders in liquidation of the Partnership, within 90 days following the occurrence of such Tax Event, Series A Junior Subordinated Debentures having a principal amount equal to the aggregate liquidation preference of the outstanding Series A Preference Securities and with accrued and unpaid interest in an amount equal to any unpaid Dividends on the Series A Preferred Securities; provided, however, that (A) the Partnership shall be required to obtain an opinion of 8 counsel (which may be regular tax counsel to PacifiCorp or an Affiliate, but not an employee thereof) to the effect that the holders of the Series A Preferred Securities will not recognize any gain or loss for federal income tax purposes as a result of such dissolution and distribution of Series A Junior Subordinated Debentures and (B) the General Partner may elect to cause the Series A Preferred Securities to remain outstanding. After the date fixed for any distribution of Series A Junior Subordinated Debentures upon dissolution of the Partnership, (i) the Series A Preferred Securities will no longer be deemed to be outstanding, (ii) DTC or its nominee, as the record Holder of the Series A Preferred Securities, will return the registered global certificate or certificates representing the Series A Preferred Securities and will receive a registered global certificate or certificates representing the Series A Junior Subordinated Debentures to be delivered upon such distribution and (iii) any certificates representing Series A Preferred Securities not held by DTC or its nominee will be deemed to represent Series A Junior Subordinated Debentures having a principal amount and accrued and unpaid interest equal to the aggregate of the stated liquidation preference of, and accrued and unpaid Dividends on, such Series A Preferred Securities until such certificates are presented to the General Partner or its agent for transfer or reissuance. (d) Redemption Procedures. _____________________ (i) Notice of any redemption (a "Notice of _________ Redemption") of the Series A Preferred Securities will be __________ given by the Partnership by mail to each record Holder to be redeemed not fewer than 30 nor more than 60 days prior to the date fixed for redemption thereof. For purposes of the calculation of the date of redemption and the dates on which notices are given pursuant to this paragraph (d)(i), ________________ a Notice of Redemption shall be deemed to be given on the day such notice is first mailed by first-class mail, postage prepaid, to Preferred Security Holders who hold Series A Preferred Securities. Each Notice of Redemption shall be addressed to the Preferred Security Holders who hold Series A Preferred Securities at the address of the Holder appearing in the books and records of the Partnership. No defect in the Notice of Redemption or in the mailing thereof or publication of its contents shall affect the validity of the redemption proceedings. (ii) In the event that fewer than all the outstanding Series A Preferred Securities are to be redeemed, the Series A Preferred Securities to be redeemed in the case of a redemption pursuant to paragraph (c)(i) ________________ will be selected in accordance with paragraph _________ 9 (d)(iv) hereof. The Partnership may not redeem fewer than _______ all the outstanding Series A Preferred Securities unless all accrued and unpaid Dividends have been paid on all Series A Preferred Securities for all monthly Dividend periods terminating on or prior to the date of redemption. (iii) If the Partnership gives a Notice of Redemption in respect of Series A Preferred Securities, then, (A) by 12:00 noon, New York time, on the redemption date in the case of Clauses (I) and (II) below or ___________ ____ (B) prior to the close of business on the Business Day immediately preceding the redemption date in the case of Clause (III) below, the Partnership will irrevocably ____________ deposit with (I) DTC, if DTC is the Clearing Agency on the date such Notice of Redemption is given, (II) such other Person which is the Clearing Agency on the date such Notice of Redemption is given or (III) if there is no Clearing Agency with respect to the Preferred Securities on the date such Notice of Redemption is given, the Paying Agent or Paying Agents appointed by the General Partner pursuant to Section 10.7 of the Partnership Agreement, ____________ funds sufficient to pay the applicable Redemption Price and will give DTC, such other Clearing Agency or the Paying Agent or Paying Agents, as the case may be, irrevocable instructions and authority to pay the Redemption Price to the Holders of the Series A Preferred Securities. If Notice of Redemption shall have been given and funds deposited as required, then upon the date of such deposit, all rights of the Preferred Security Holders who hold such Series A Preferred Securities so called for redemption will cease, except the right of the Holders of such securities to receive the Redemption Price, but without interest on such Redemption Price. In the event that any date fixed for redemption of Series A Preferred Securities is not a Business Day, then payment of the Redemption Price payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay), except that, if such Business Day falls in the next calendar year, such payment will be made on the immediately preceding Business Day. In the event that payment of the Redemption Price in respect of Series A Preferred Securities is improperly withheld or refused and not paid either by the Partnership or by PacifiCorp pursuant to the Guarantee, Dividends on such Series A Preferred Securities will continue to accrue at the then applicable rate, from the original redemption date to the date of payment, in which case the actual payment date will be considered the date fixed for redemption for purposes of calculating the Redemption Price. (iv) Redemption notices shall be sent to (A) Cede & Co. or any successor nominee of DTC, in either 10 case so long as DTC is the Clearing Agency, (B) the nominee of any Clearing Agency other than DTC or (C) any Paying Agent or Paying Agents appointed by the General Partner pursuant to Section 10.7 of the Partnership ____________ Agreement. If less than all of the Series A Preferred Securities are being redeemed, interests to be redeemed shall be determined as follows: (x) in accordance with DTC's practice, so long as DTC is the Clearing Agency, (y) in accordance with the practice of any other Clearing Agency or (z) if, at the time such redemption notice is sent, there is no Clearing Agency, the Paying Agent or Paying Agents shall select, by lot or in such other manner as the Paying Agent or Paying Agents shall deem appropriate and fair, in their discretion, the Preferred Securities to be redeemed. (e) Liquidation Distribution. In the event of any ________________________ voluntary or involuntary dissolution, winding up or termination of the Partnership, Preferred Security Holders who hold the Series A Preferred Securities at the time will be entitled to receive out of the assets of the Partnership available for distribution to Partners after satisfaction of liabilities of creditors as required by the Act, before any distribution of assets is made to the General Partner, but together with the Holders of every other series of Preferred Securities outstanding, if any, an amount equal to, in the case of Holders of Series A Preferred Securities, the aggregate of the stated liquidation preference of $25 per Preferred Security and accrued and unpaid Dividends thereon (whether or not declared) to the date of payment (the "Liquidation Distribution"), unless ________________________ in connection with such dissolution, winding up or termination, Series A Junior Subordinated Debentures in an aggregate principal amount equal to the aggregate of the stated liquidation preference of $25 per Preferred Security of all Series A Preferred Securities then outstanding with accrued and unpaid interest in an amount equal to any unpaid Dividends on the Series A Preferred Securities have been distributed on a pro rata basis to the Holders of the Series A Preferred Securities. If, upon any such liquidation, the Liquidation Distribution can be paid only in part because the Partnership has insufficient assets available to pay in full the aggregate Liquidation Distribution and the aggregate maximum liquidation distributions on any other series of Preferred Securities, then the amounts payable directly by the Partnership on the Series A Preferred Securities and on such other series of Preferred Securities shall be paid on a pro rata basis, so that (i) the aggregate amount paid in respect of the Liquidation Distribution bears to the aggregate amount paid as liquidation distributions on such other series of Preferred Securities the same ratio as 11 (ii) the aggregate Liquidation Distribution bears to the aggregate maximum liquidation distributions on such other series of Preferred Securities. (f) Voting Rights. If (i) the Partnership fails to _____________ pay Dividends in full on the Series A Preferred Securities for 18 consecutive monthly Dividend periods, (ii) an event of default occurs and is continuing on the Series A Junior Subordinated Debentures or (iii) PacifiCorp is in default on any of its payment or other obligations under the Guarantee, then the Holders of the Series A Preferred Securities, together with the Holders of any other series of Preferred Securities having the right to vote for the appointment of a Special Representative in such event, acting as a single class, will be entitled by the majority vote of such Holders to appoint and authorize a Special Representative to enforce the Partnership's creditor rights under the Junior Subordinated Debentures, enforce the rights of the Series A Preferred Security Holders under the Guarantee and enforce the rights of the Preferred Security Holders to receive Dividends on Preferred Securities, PacifiCorp agreeing to execute and deliver such documents as may be necessary, appropriate or convenient for the Special Representative to enforce such rights and obligations. In furtherance of the foregoing, and without limiting the powers of any Special Representative so appointed and for the avoidance of any doubt concerning the powers of the Special Representative, any Special Representative, in its own name, in the name of the Partnership, in the name of the Series A Preferred Security Holders or otherwise, may institute or cause to be instituted a proceeding, including, without limitation, any suit in equity, an action at law or other judicial or administrative proceeding, to enforce the Partnership's or the Series A Preferred Security Holders' rights directly against PacifiCorp, or any other obligor in connection with such obligations on behalf of the Partnership, or the Series A Preferred Security Holders, and may prosecute such proceeding to judgment or final decree, and enforce the same against PacifiCorp or any other obligor in connection with such obligations and collect, out of the property, wherever situated, of PacifiCorp or any such other obligor upon such obligations, the monies adjudged or decreed to be payable in the manner provided by law. The Special Representative shall not by virtue of acting in such capacity be admitted as a general partner in the Partnership or otherwise be deemed to be a general partner in the Partnership and shall have no liability for the debts, obligations or liabilities of the Partnership. For purposes of determining whether the Partnership has failed to pay Dividends in full for 18 consecutive monthly Dividend periods, Dividends shall be deemed to remain in 12 arrears, notwithstanding any payments in respect thereof, until full cumulative Dividends have been or contemporaneously are declared and paid with respect to all monthly Dividend periods terminating on or prior to the date of payment of such full cumulative Dividends. Not later than 30 days after such right to appoint a Special Representative arises, the General Partner will convene a meeting for the purpose of appointing a Special Representative. If the General Partner fails to convene such meeting within such 30-day period, the Holders of 10% in liquidation preference of the outstanding Preferred Securities will be entitled to convene such meeting. The provisions of Section 12.3 of the Partnership Agreement relating to the ____________ convening and conduct of meetings of the Partners will apply with respect to any such meeting. Any Special Representative so appointed shall cease to be a representative of the Partnership and the Limited Partners if the Partnership (or PacifiCorp pursuant to the Guarantee) shall have paid in full all accumulated and unpaid Dividends on the Preferred Securities or such default or breach, as the case may be, shall have been cured, and PacifiCorp, as the general partner of the Partnership, is hereby authorized to and shall continue the business of the Partnership without dissolution. Notwithstanding the appointment of any such Special Representative, PacifiCorp retains all rights under the Indenture, including the right to extend the interest payment period and shall continue to be a general partner in the Partnership. If any proposed amendment of this Action provides for, or the General Partner otherwise proposes to effect (pursuant to an Action or otherwise), (x) any action which would adversely affect the powers, preferences or special rights of the Series A Preferred Securities, whether by way of amendment of this Action or otherwise (including, without limitation, the authorization or issuance of any interests ranking, as to participation in the profits and Dividends or in the assets of the Partnership, senior or junior to the Series A Preferred Securities), or (y) the dissolution, winding up or termination of the Partnership, other than (A) a dissolution, winding up or termination in connection with which the Partnership distributes the Series A Junior Subordinated Debentures to the Series A Security Holders upon the occurrence of a Tax Event or (B) as described in paragraph (g) below, then _____________ the Series A Preferred Security Holders will be entitled to vote on such amendment or proposal of the General Partner (but not on any other amendment or proposal) as a class with all other Holders of Preferred Securities similarly affected, and such amendment or proposal shall not be effective except with the approval of Holders of 66-2/3% in liquidation preference of such outstanding Preferred Securities having a right to vote on the matter; provided, however, that no such approval shall be ________ _______ required if the dissolution, winding up or termination of the Partnership is proposed or initiated pursuant to Section 11.2 ____________ 13 of the Partnership Agreement or upon the initiation of proceedings, or after proceedings have been initiated, for the dissolution, winding up or termination of PacifiCorp. The rights attached to the Series A Preferred Securities will be deemed not to be [materially] adversely affected by the creation or issue of, and no vote will be required for the creation of, any further Preferred Securities ranking pari passu with the Series A Preferred Securities with regard to participation in the profits and Dividends or in the assets of the Partnership. Any required approval of Holders of Series A Preferred Securities may be given at a separate meeting of such Holders convened for such purpose, at a meeting of all of the Partners or pursuant to written consent. The Partnership will cause a notice of any meeting at which Limited Partners holding Series A Preferred Securities are entitled to vote, or of any matter upon which action by written consent of such Holders is to be taken, to be mailed to each Holder of Series A Preferred Securities. Each such notice will include a statement setting forth (i) the date of such meeting or the date by which such action is to be taken, (ii) a description of any matter on which such Holders are entitled to vote or upon which written consent is sought and (iii) instructions for the delivery of proxies or consents. No vote or consent of the Holders of Series A Preferred Securities will be required for the Partnership to redeem and cancel Series A Preferred Securities in accordance with this Action. Notwithstanding that Holders of Series A Preferred Securities are entitled to vote or consent under any of the circumstances described above, any of the Series A Preferred Securities and any other series of Preferred Securities that are entitled to vote or consent with such Series A Preferred Securities as a single class at such time that are owned by PacifiCorp or any Person owned more than 50% by PacifiCorp, either directly or indirectly, shall not be entitled to vote or consent and shall, for the purposes of such vote or consent, be treated as if they were not outstanding. (g) Mergers. The Partnership shall not consolidate, _______ amalgamate, merge with or into, or be replaced by, or convey, transfer or lease its properties and assets substantially as an entirety to any Person, except as described below. The Partnership may, without the consent of the Holders of the Series A Preferred Securities, consolidate, amalgamate, merge with or into, or be replaced by a limited partnership, a limited liability company or a trust organized as such under the laws of any state of the United States of America; provided, that (i) such successor entity either (x) expressly assumes all of the obligations of the Partnership under the Series A Preferred Securities or (y) substitutes for the 14 Series A Preferred Securities other securities having substantially the same terms as the Series A Preferred Securities (the "Successor Securities") so long as the ____________________ Successor Securities rank, with respect to participation in the profits and Dividends or in the assets of the successor entity, at least as high as the Series A Preferred Securities rank with respect to participation in the profits and Dividends or in the assets of the Partnership, (ii) PacifiCorp expressly acknowledges such successor entity as the Holder of the Series A Junior Subordinated Debentures, (iii) the Series A Preferred Securities or the Successor Securities are listed, or will be listed on notification of issuance, on any national securities exchange or other organization on which the Series A Preferred Securities are then listed, (iv) such merger, consolidation, amalgamation or replacement does not cause the Series A Preferred Securities (or the Successor Securities) to be downgraded by any nationally recognized statistical rating organization, as that term is defined by the Securities and Exchange Commission for purposes of Rule 436(g)(2) under the Securities Act, (v) such merger, consolidation, amalgamation or replacement does not adversely affect the powers, preferences and special rights of Holders of Series A Preferred Securities (including any Successor Securities) in any material respect, (vi) such successor entity has a purpose substantially identical to that of the Partnership and (vii) prior to such merger, consolidation, amalgamation or replacement, PacifiCorp has received an opinion of nationally recognized independent counsel to the Partnership experienced in such matters to the effect that (x) such successor entity will be treated as a partnership for Federal income tax purposes, (y) following such merger, consolidation, amalgamation or replacement, PacifiCorp and such successor entity will be in compliance with the 1940 Act without registering thereunder as an investment company, and (z) such merger, consolidation, amalgamation or replacement will not adversely affect the limited liability of Holders of Series A Preferred Securities. IN WITNESS WHEREOF, the General Partner has executed this Action as of this _____ day of ______________, 1994. GENERAL PARTNER: PACIFICORP, an Oregon corporation By: _____________________________ Name: _______________________ Title: ______________________ 15 EX-15 8 EXHIBIT 15 PacifiCorp 700 N.E. Multnomah Portland, Oregon We have made a review, in accordance with standards established by the American Institute of Certified Public Accountants, of the unaudited interim financial information of PacifiCorp and subsidiaries for the periods ended March 31, 1994 and 1993 and June 30, 1994 and 1993, as indicated in our reports dated May 12, 1994 and August 11, 1994, respectively; because we did not perform an audit, we expressed no opinion on that information. We are aware that our reports referred to above, which were included in your Quarterly Reports on Forms 10-Q for the quarters ended March 31, 1994 and June 30, 1994, are being used in this Registration Statement. We are also aware that the aforementioned reports, pursuant to Rule 436(c) under the Securities Act, are not considered a part of the Registration Statement prepared or certified by an accountant or a report prepared or certified by an accountant within the meaning of Sections 7 and 11 of that Act. DELOITTE & TOUCHE LLP Portland, Oregon October 13, 1994 -----END PRIVACY-ENHANCED MESSAGE-----