MIDAMERICAN FUNDING, LLC
and
IBJ WHITEHALL BANK & TRUST COMPANY
as Trustee
5.85% Senior Secured Notes due 2001
6.339% Senior Secured Notes due 2009
6.927% Senior Secured Bonds due 2029
First Supplemental Indenture
Dated as of March 11, 1999
FIRST SUPPLEMENTAL INDENTURE, dated as of March 11, 1999
(herein called the "First Supplemental Indenture"), between MIDAMERICAN FUNDING,
LLC., an Iowa limited liability comapny (hereinafter called the "Company"), and
IBJ Whitehall Bank & Trust Company, a banking corporation organized under the
laws of the state of New York, as Trustee (hereinafter called the "Trustee")
under the Original Indenture referred to below.
WITNESSETH:
WHEREAS, the Company has heretofore executed and delivered to
the Trustee an indenture dated as of March 11, 1999 (hereinafter called the
"Original Indenture"), to provide for the issuance from time to time of its
unsecured debentures, notes or other evidences of indebtedness (herein called
the "Securities"), the form and terms of which are to be established as set
forth in Sections 201 and 301 of the Original Indenture.
WHEREAS, Section 901 of the Original Indenture provides, among
other things, that the Company and the Trustee may enter into indentures
supplemental to the Original Indenture for, among other things, the purpose of
establishing the form and terms of the Securities of any series as permitted in
Sections 201 and 301 of the Original Indenture and of appointing an
Authenticating Agent with respect to the Securities of any series;
WHEREAS, the Company desires to create three series of the
Securities, one series of the Securities in an aggregate principal amount of two
hundred million dollars ($200,000,000) to be designated the "5.85% Senior
Secured Notes due 2001", one series of the Securities in an aggregate principal
amount of one hundred seventy-five million dollars ($175,000,000) to be
designated the "6.339% Senior Secured Notes due 2009", and one series of the
Securities in an aggregate principal amount of three hundred twenty-five million
dollars ($325,000,000) to be designated the "6.927% Senior Secured Bonds due
2029" (collectively the "Securities"), and all action on the part of the Company
necessary to authorize the issuance of the Securities under the Original
Indenture and this First Supplemental Indenture has been duly taken; and
WHEREAS, all acts and things necessary to make the Securities,
when executed by the Company and authenticated and delivered by the Trustee as
provided in the Original Indenture, the valid and binding obligations of the
Company and to constitute these presents a valid and binding supplemental
indenture and agreement according to its terms, have been done and performed;
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NOW, THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE WITNESSETH:
That in consideration of the premises and of the acceptance
and purchase of the Securities by the holders thereof and of the acceptance of
this trust by the Trustee, the Company covenants and agrees with the Trustee,
for the equal benefit of holders of the Securities, as follows:
ARTICLE I
Definitions
The use of the terms and expressions herein is in accordance
with the definitions, uses and constructions contained in the Original Indenture
and the forms of Securities attached hereto as Exhibits A, B and C,
respectively. In addition, for all purposes of this First Supplemental
Indenture, except as otherwise expressly provided or unless the context
otherwise expressly requires, the following terms shall have the respective
meanings assigned to them as follows and shall be construed as if defined in
Article I of the Original Indenture:
"CalEnergy" means CalEnergy Company, Inc., a Delaware
corporation, and its successors.
"Deadline Date" means September 7, 1999.
"Escrow Agent" means the escrow agent from time to time under
the Escrow Agreement.
"Escrow Agreement" means the Escrow Agreement dated as of
March 11, 1999, between the Company and IBJ Whitehall Bank & Trust Company, as
escrow agent thereunder.
"Exchange Security" means a security in global or definitive
form substantially in the form set forth in Exhibit A.4, with respect to the
5.85% Senior Secured Notes due 2001, or in the form set forth in Exhibit B.4,
with respect to the 6.339% Senior Secured Notes due 2009, or in the form set
forth in Exhibit C.4, with respect to the 6.927% Senior Secured Bonds due 2029,
in each case, to this First Supplemental Indenture.
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"Global Security" means a Rule 144A Global Security or a
Regulations S Global Security, in global form substantially in the form set
forth in Exhibits A.1 and A.2, with respect to the 5.85% Senior Secured Notes
due 2001, Exhibits B.1 and B.2, with respect to the 6.339% Senior Secured Notes
due 2009, or in the form set forth in Exhibits C.1 and C.2, with respect to the
6.927% Senior Secured Bonds due 2029, in each case, to this First Supplemental
Indenture.
"Initial Purchasers" means Credit Suisse First Boston
Corporation, ▇▇▇▇▇▇ Brothers Inc., ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. and ▇▇▇▇▇▇▇ Lynch,
▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated.
"Mandatory Redemption Date" means the earlier of (a) September
27, 1999 if the MidAmerican Merger has not been consummated on or prior to the
Deadline Date, or (b) the 20th day (or if such day is not a Business Day, the
first Business Day thereafter) following the abandonment of the MidAmerican
Merger by CalEnergy or the termination of the MidAmerican Merger Agreement.
"Mandatory Redemption Price" means a redemption price equal to
100% of the aggregate principal amount of the Securities, together with accrued
and unpaid interest thereon on the Mandatory Redemption Date (subject to the
right of holders of record on the relevant record date to receive interest due
on the relevant interest payment date).
"Registration Rights Agreement" means the Registration Rights
Agreement dated as of March 11, 1999 between the Company and the Initial
Purchasers.
ARTICLE II
Terms and Issuance of the Securities
Section 201. Issue of Securities. Three series of Securities,
which shall be designated the 5.85% Senior Secured Notes due 2001, the "6.339%
Senior Secured Notes due 2009", the "6.927% Senior Secured Bonds due 2029",
respectively (collectively, the "Securities"), shall be executed, authenticated
and delivered in accordance with the provisions of, and shall in all respects be
subject to, the terms, conditions and covenants of the Original Indenture and
this First Supplemental Indenture (including the forms of Securities set forth
in Exhibits A, B and C, as applicable). The aggregate principal amount of the
5.85% Senior Secured Notes due 2001, the aggregate principal amount of the
6.339% Senior Secured Notes due 2009 and the
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aggregate principal amount of the 6.927% Senior Secured Bonds due 2029 which may
be authenticated and delivered under the First Supplemental Indenture shall not
exceed $200,000,000, $175,000,000 and $325,000,000, respectively.
Section 202. Mandatory Redemption. If (i) the MidAmerican
Merger is not consummated on or prior to the Deadline Date or (ii) CalEnergy
elects to abandon the MidAmerican Merger, or the MidAmerican Merger Agreement is
terminated, in either case, on or prior to the Deadline Date, for any reason,
the Company shall redeem all the Securities on the Mandatory Redemption Date, in
cash, at the Mandatory Redemption Price, as provided in paragraph 3 of the
Securities.
The provisions of Article XI of the Original Indenture shall
apply to mandatory redemption of the Securities except as modified below. If the
Company is required to redeem all of the Securities pursuant to this Section 202
and paragraph 3 of the Securities, the Company shall notify the Trustee in
writing of the applicable Mandatory Redemption Date and shall also notify the
Escrow Agent concurrently with its notification to the Trustee. The Company
shall give such notices to the Trustee and Escrow Agent provided for in this
Section promptly after the occurrence of the event triggering the mandatory
redemption of the Securities. In the event of a mandatory redemption of the
Securities pursuant to this Section and paragraph 3 of the Securities, the
Company shall mail the notice of redemption required to be delivered to each
Holder of Securities by Section 1104 on the date it delivers the notices to the
Trustee and the Escrow Agent.
Section 203. Optional Redemption. The Securities may be
redeemed, in whole or in part, at the option of the Company pursuant to the
terms set forth in paragraph 2 of the series of Securities to be redeemed. The
provisions of Article XI of the Original Indenture shall also apply to any
optional redemption of Securities by the Company.
Section 204. Limitation on Liens. The covenant provided by
Section 1004 of the Original Indenture shall be applicable to the Securities.
Section 205. Limitation on Distributions. The covenant
provided by Section 1005 of the Original indenture shall be applicable to the
Securities.
Section 206. Limitation on Indebtedness of the Company. The
covenant provided by Section 1006 of the Original Indenture shall be applicable
to the Securities.
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Section 207. Place of Payment. The Place of Payment in respect
of the Securities will be in The City of New York, initially at the Corporate
Trust Office of IBJ Whitehall Bank & Trust Company (which as of the date hereof
is located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ Attention: Capital
Markets Trust Services.
Section 208. Form of Securities; Incorporation of Terms. The
forms of the Securities shall be substantially in the forms of Exhibits A, B and
C attached hereto, as applicable, the respective terms of which are herein
incorporated by reference and which are part of this First Supplemental
Indenture. The Securities shall be issued as one or more Global Securities in
fully registered form and one or more Definitive Securities in fully registered
form, as determined in accordance with Section 201 of the Original Indenture.
The Global Securities shall be delivered by the Trustee to the Depositary, as
the Holder thereof, or a nominee or custodian therefor, to be held by the
Depositary in accordance with the Original Indenture.
Section 209. Exchange of the Global Securities. Each of the
Global Securities shall be exchangeable for Definitive Securities only as
provided in Section 307(b)(ii) of the Original Indenture.
Section 210. Regular Record Date for the Securities. The
Regular Record Date for the Securities shall be the February 15 or August 15
immediately prior to each Interest Payment Date.
Section 211. Authorized Denominations. Beneficial interests in
Global Securities, as well as Definitive Securities, may be held only in
denominations of $1,000 and integral multiples of $1,000 in excess thereof.
ARTICLE III
DEPOSITARY
Section 301. Depositary. The Depository Trust Company, its
nominees and their respective successors are hereby appointed Depositary with
respect to the Global Securities.
ARTICLE IV
Section 401. Execution as Supplemental Indenture. This First
Supplemental Indenture is executed and shall be construed as an indenture
supplemental to the Original Indenture and, as provided in the Original
Indenture, this First Supplemental Indenture forms a part thereof.
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Section 402. Effect of Headings. The Article and Section
headings herein are for convenience only and shall not affect the construction
hereof.
Section 403. Successors and Assigns. All covenants and
agreements in this First Supplemental Indenture by the Company shall bind its
successors and assigns, whether so expressed or not.
Section 404. Separability Clause. In case any provision in
this First Supplemental Indenture or in the Securities shall be invalid, illegal
or unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
Section 405. Benefits of First Supplemental Indenture. Nothing
in this First Supplemental Indenture or in the Securities, express or implied,
shall give to any person, other than the parties hereto and their successors
hereunder and the Holders, any benefit or any legal or equitable right, remedy
or claim under this First Supplemental Indenture.
Section 406. Execution and Counterparts. This First
Supplemental Indenture may be executed in any number of counterparts, each of
which shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereof have caused this First
Supplemental Indenture to be duly executed by their respective officers or
directors duly authorized thereto, all as of the day and year first above
written.
MIDAMERICAN FUNDING, LLC
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President and Secretary
IBJ WHITEHALL BANK & TRUST COMPANY
as Trustee
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By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President
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EXHIBIT A.1
FORM OF FACE OF RULE 144A GLOBAL SENIOR SECURED NOTE DUE 2001
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS HELD BY THE DEPOSITORY TRUST COMPANY
(THE "DEPOSITARY") OR A NOMINEE OF THE DEPOSITARY. THIS SECURITY IS EXCHANGEABLE
FOR SECURITIES HELD BY A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITARY TO
A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY
OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO
A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY) MAY BE MADE
EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS GLOBAL SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITARY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY DEFINITIVE SECURITY IS ISSUED IN THE NAME
OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITARY (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER
ENTITY AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL IN AS MUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
THIS SECURITY (OR ITS PREDECESSOR) HAS BEEN INITIALLY RESOLD
IN RELIANCE ON RULE 144A UNDER THE SECURITIES ACT AND SHALL BEAR THE FOLLOWING
LEGEND UNTIL REMOVABLE IN ACCORDANCE WITH ITS TERMS AND THE TERMS OF THE
INDENTURE. THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, THIS SECURITY MAY NOT
BE OFFERED OR SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION
OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY
NOTIFIED THAT THE SELLER OF THIS
1
SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF
THE SECURITIES ACT PROVIDED BY RULE 144A AND REGULATION S THEREUNDER.
BY ITS ACQUISITION HEREOF, EACH OF THE HOLDER OF THIS SECURITY
AND ANY OWNERS OF INTERESTS HEREIN, FOR THE BENEFIT OF THE COMPANY, (1)
REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT), (2) AGREES THAT BEGINNING FROM THE LATER OF (X) THE
ORIGINAL ISSUE DATE OF THIS SECURITY OR (Y) THE LAST DATE ON WHICH THE COMPANY
OR ANY AFFILIATE THEREOF WAS THE BENEFICIAL OWNER OF THIS SECURITY (OR ANY
PREDECESSOR HEREOF) THROUGH THE TIME PERIOD REFERRED TO IN RULE 144(K) UNDER THE
SECURITIES ACT, IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT
(A) TO THE COMPANY OR ANY AFFILIATE THEREOF, (B) IN THE UNITED STATES TO A
PERSON WHOM THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (C) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (D) PURSUANT
TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, IN EACH OF CASES (A) TO (E) IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND (3) AGREES THAT
IT WILL, AND EACH SUBSEQUENT HOLDER WILL BE REQUIRED TO, DELIVER TO EACH PERSON
TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND ON THESE RESALE RESTRICTIONS.
UNLESS THE COMPANY DETERMINES OTHERWISE IN ACCORDANCE WITH
APPLICABLE LAW, THIS LEGEND WILL BE REMOVED BY THE COMPANY UPON REQUEST OF THE
HOLDER, AFTER THE EXPIRATION OF THE TIME PERIOD REFERRED TO IN RULE 144(K) UNDER
THE SECURITIES ACT BEGINNING FROM THE LATER OF (A) THE ORIGINAL ISSUE DATE OF
THIS SECURITY AND (B) THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE
THEREOF WAS THE BENEFICIAL OWNER OF THIS SECURITY (OR ANY PREDECESSOR HEREOF).
2
MIDAMERICAN FUNDING, LLC
5.85% Senior Secured Notes due 2001
$____________
No.___ CUSIP No. 59562H AA 8
MIDAMERICAN FUNDING, LLC., a limited liability company
organized under the laws of Iowa (herein called the "Company," which term
includes any successor corporation or limited liability company under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to CEDE & Co., or registered assigns, the principal amount of [ ] Million
Dollars (such principal amount, as it may from time to time be adjusted by
endorsement on Schedule A hereto, is hereinafter referred to as the "Principal
Amount") on March 1, 2001, and to pay interest thereon from March 11, 1999, or
from the most recent Interest Payment Date to which interest has been paid or
duly provided for, semi-annually on March 1 and September 1 in each year,
commencing September 1, 1999 at the rate of 5.85% per annum, until the Principal
Amount hereof is paid or made available for payment; provided that any Principal
Amount and premium, and any such installment of interest, which is overdue shall
continue to bear interest at the aforesaid rate of 5.85% per annum (to the
extent that the payment of such interest shall be legally enforceable) from the
dates such amounts are due until they are paid or made available for payment.
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in such Indenture, be paid to the Person
in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest, which shall be the February 15 or August 15 (whether or not a Business
Day), as the case may be, immediately preceding such Interest Payment Date. Any
such interest not so punctually paid or duly provided for will forthwith cease
to be payable to the Person in whose name this Security (or one or more
Predecessor Securities) is registered on such Regular Record Date and may be
paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof shall be given to Holders of Securities of this series not less than 10
days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities of this series may be listed, and upon such notice as
may be required by such exchange, all as more fully provided in said Indenture.
If an Illiquidity Event (as defined in the Registration Rights Agreement)
occurs, interest will accrue on this Security at a rate of 6.35% per annum from
and including the date on which any such Illiquidity Event shall occur, until
but excluding the date on which all Illiquidity Events shall cease to exist or
shall otherwise have been cured; provided, however, that if such Illiquidity
Event has not ceased to exist or is not otherwise cured within two years after
the consummation of the MidA-
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▇▇▇▇▇▇▇ ▇▇▇▇▇▇ (as defined in the Indenture), such increase in interest rate
will become permanent.
Payment of the principal of (and premium, if any) and interest
on this Security shall be made at the office or agency of the Company maintained
for that purpose in the Borough of Manhattan, The City of New York, or at such
additional offices or agencies as the Company from time to time may designate
for such purpose, in such coin or currency of the United States of America as at
the time of payment is legal tender for the payment of public and private debts,
provided, however, that, at the option of the Company, payment of the interest
on this Security may be made only upon presentation and surrender hereof at any
such office or agency and, at the option of the Company, payment of interest may
be made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register. Payment of interest, if any, in
respect of this Security may also be made, in the case of a Holder of at least
U.S. $1,000,000 aggregate principal amount of Securities, by wire transfer to a
U.S. Dollar account maintained by the Holder with a bank in the United States;
provided that such Holder elects payment by wire transfer by giving written
notice to the Trustee or Paying Agent to such effect designating such account no
later than 15 days immediately preceding the relevant due date for payment (or
such other date as the Trustee may accept in its discretion).
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS
SECURITY SET FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL
PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
4
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
MIDAMERICAN FUNDING, LLC
By: ________________________________
Name:
Title:
5
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein
and referred to in the within-mentioned Indenture.
IBJ WHITEHALL BANK & TRUST COMPANY
as Trustee
Dated:______________ By: ________________________________
Authorized Signatory
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FORM OF REVERSE OF RULE 144A GLOBAL SENIOR SECURED NOTE DUE 2001
MIDAMERICAN FUNDING, LLC
5.85% Senior Secured Notes due 2001
1. GENERAL
This Security is one of a duly authorized issue of Securities
of the Company (herein called the "Securities"), issued and to be issued in one
or more series under an Indenture, dated as of March 11, 1999 (herein called the
"Original Indenture"), between the Company and IBJ Whitehall Bank & Trust
Company, as trustee (herein called the "Trustee," which term includes any
successor trustee under the Original Indenture), as supplemented by the First
Supplemental Indenture, dated as of March 11, 1999 (together with the Original
Indenture, the "Indenture") between the Company and the Trustee, to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Securities and of
the terms upon which the Securities are, and are to be, authenticated and
delivered. Terms defined in the Indenture which are not defined herein are used
with the meanings assigned to them in the Indenture. This Security is one of the
series designated on the face hereof, limited in aggregate principal amount to
$200,000,000.
2. OPTIONAL REDEMPTION
The Securities of this series will be redeemable in whole or
in part, at the option of the Company at any time, at a Redemption Price equal
to the greater of (i) 100% of the principal amount of the Securities of this
series being redeemed or (ii) the sum of the present values of the remaining
scheduled payments of principal of and interest on the Securities of this series
being redeemed discounted to the Redemption Date on a semiannual basis (assuming
a 360-day year consisting of twelve 30-day months) at a discount rate equal to
the Treasury Yield plus 0 basis points, plus, for (i) or (ii) above, whichever
is applicable, accrued interest on the Securities of this series to the
Redemption Date.
"Treasury Yield" means, with respect to any Redemption Date,
the rate per annum equal to the semiannual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such Redemption Date.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of
7
the Securities of this series to be redeemed that would be utilized, at the time
of selection and in accordance with customary financial practice, in pricing new
issues of corporate debt securities of comparable maturity to the remaining term
of the Securities of this series.
"Comparable Treasury Price" means, with respect to any
Redemption Date, (i) the average of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
on the third Business Day in New York City preceding such Redemption Date, as
set forth in the daily statistical release (or any successor release) published
by the Federal Reserve Bank of New York and designated "Composite 3:30 p.m.
Quotations for U.S. Government Securities" or (ii) if such release (or any
successor release) is not published or does not contain such prices on such
Business Day, the Reference Treasury Dealer Quotation for such Redemption Date.
"Independent Investment Banker" means an investment banking
institution of international standing appointed by the Company.
"Reference Treasury Dealer" means a primary U.S. Government
securities dealer in New York City appointed by the Company.
"Reference Treasury Dealer Quotation" means, with respect to
the Reference Treasury Dealer and any Redemption Date, the average, as
determined by the Company, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount
and quoted in writing to the Company by such Reference Treasury Dealer at 5:00
p.m. on the third Business Day in New York City preceding such Redemption Date).
Notice of redemption pursuant to this paragraph 2 shall be
given as provided for in the Indenture not less than 30 days nor more than 60
days prior to the Redemption Date.
If fewer than all the Securities of this series are to be
redeemed, selection of Securities of this series for redemption will be made by
the Trustee in any manner the Trustee deems fair and appropriate.
The Trustee may conclusively rely on an Officers' Certificate
setting forth the calculation of the Redemption Price, which Officers'
Certificate shall be delivered to the Trustee prior to the Redemption Date.
Unless the Company defaults in payment of the Redemption Price,
from and after the Redemption Date, the Securities of this series or portions
thereof called for redemption will cease to bear interest, and the Holders
thereof will have no right in respect of such Securities of this series except
the right to receive the Redemption Price thereof.
8
In the event of redemption of this Security in part only,the
Trustee will reduce the Principal Amount hereof by endorsement on Schedule A
hereto such that the Principal Amount shown on Schedule A after such endorsement
will reflect only the unredeemed portion hereof.
3. MANDATORY REDEMPTION
In the event that (i) the MidAmerican Merger is not consummate
on or prior to September 7, 1999 or (ii) CalEnergy elects to abandon the
MidAmerican Merger, or the MidAmerican Merger Agreement is terminated, in either
case, on or prior to September 7, 1999, for any reason, the Company shall redeem
all the Securities on the Mandatory Redemption Date, in cash at a redemption
price (the "Mandatory Redemption Price") equal to the aggregate principal amount
thereof plus accrued and unpaid interest thereon to the earlier of (a) September
27, 1999, in the event that the MidAmerican Merger is not consummated on or
prior to September 7, 1999 or (b) the 20th day (or if such day is not a Business
Day, the first Business Day thereafter) following the occurrence of an event
described in (ii) above (such earlier date being referred to herein as the
"Mandatory Redemption Date").
Notice of Redemption pursuant to this paragraph 3 shall be given
as provided for in the Indenture promptly after the occurrence of the event
triggering such mandatory redemption.
Unless the Company defaults in payment of the Mandatory
Redemption Price, from and after the Mandatory Redemption Date, the Securities
of this series will cease to bear interest, and the Holders thereof will have no
right in respect of such Securities of this series except the right to receive
the Mandatory Redemption Price thereof.
4. DEFEASANCE
The Indenture contains provisions for defeasance of (a) the
entire indebtedness of this Security and (b) certain restrictive covenants upon
compliance by the Company with certain conditions set forth therein.
5. DEFAULTS AND REMEDIES
If an Event of Default with respect to Securities of this
series shall occur and be continuing, the principal of the Securities of this
series may be declared due and payable in the manner and with the effect
provided in the Indenture. At any time after such declaration of acceleration
with respect to Securities of this series has been made, but before a judgment
or decree for payment of money has been obtained by the Trustee as provided in
the Indenture, if all Events of Default with respect to Securities of this
series have been cured or waived (other than
9
the non-payment of principal of the Securities of this series which has become
due solely by reason of such declaration of acceleration) then and in every such
case, the Holders of a majority in aggregate principal amount of the Outstanding
securities under the Indenture may, by written notice to the Company and to the
Trustee, rescind and annul such declaration and its consequences on behalf of
all of the Holders, but no such recision or annulment shall extend to or affect
any subsequent default or impair any right consequent thereon.
As provided in and subject to the provisions of the Indenture,
the Holder of this Security shall not have the right to institute any
proceeding, judicial or otherwise, with respect to the Indenture, or for the
appointment of a receiver, or trustee or for any other remedy thereunder, unless
(a) such Holder shall have previously given the Trustee written notice of a
continuing Event of Default with respect to the Securities, (b) the Holders of
not less than 33% or a majority, as applicable, in principal amount of the
Securities at the time Outstanding under the Indenture shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee, (c) such Holder shall have offered the Trustee indemnity
satisfactory to the Trustee against the costs, expenses and liabilities to be
incurred in compliance with such request, (d) the Trustee shall not have
received from the Holders of a majority in principal amount of Securities at the
time Outstanding under the Indenture a direction inconsistent with such request
and (e) the Trustee for 90 days after its receipt of such notice from the
Holder, request and offer of indemnity shall have failed to institute any such
proceeding. The foregoing shall not apply to certain suits described in the
Indenture, including any suit instituted by the Holder of this Security for the
enforcement of any payment of principal hereof or any premium or interest hereon
on or after the respective due dates expressed herein.
6. AMENDMENT AND WAIVER
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the Indenture or any
supplemental indenture or the rights and obligations of the Company and rights
of the Holders of the Securities of any series at any time by the Company and
the Trustee with the consent of the Holders of a majority in aggregate principal
amount of the Securities at the time Outstanding of each series to be affected.
The Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor on in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.
10
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of (and
premium, if any) and interest, if any, on this Security at the times, place and
rate, and in the coin or currency, herein prescribed.
7. TRANSFER AND EXCHANGE; DENOMINATIONS
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of a Security of the series of which
this Security is a part is registrable in the Security Register, upon surrender
of this Security for registration of transfer at the office or agency of the
Company in the Borough of Manhattan, The City of New York, (which initially
shall be the corporate trust office of the Trustee), duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities,
of authorized denominations and for the same aggregate principal amount, shall
be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered
form, without coupons, in denominations of $1,000 and any integral multiple
thereof. As provided in the Indenture and subject to certain limitations therein
set forth, Securities of this series are exchangeable for a like aggregate
principal amount of Securities of this series and of like tenor of a different
authorized denomination as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
8. SUCCESSOR OBLIGORS
When a successor assumes all the obligations of its
predecessor under the Securities of this series and the Indenture in accordance
with the terms of the Indenture, the predecessor will be released from those
obligations.
9. TRUSTEE DEALINGS WITH THE COMPANY
The Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Securities of this series and
may otherwise deal with the Company, its Subsidiaries or their respective
Affiliates as if it were not the Trustee.
11
10. NO RECOURSE AGAINST OTHERS
No stockholder, director, officer, employee, incorporator or
Affiliate of the Company shall have any liability for any obligation of the
Company under the Securities of this series or the Indenture or for any claim
based on, in respect of or by reason of, such obligations or their creation.
Each Holder of the Securities of this series by accepting a Security of this
series waives and releases all such liability. The waiver and release are part
of the consideration for the issuance of the Securities of this series.
11. AUTHENTICATION
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
12. CUSIP NUMBERS
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company will cause CUSIP numbers
to be printed on the Securities of this series as a convenience to the Holders
of the Securities of this series.
13. GOVERNING LAW
This Security shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to the principles
of conflict of laws thereof.
14. DEFINED TERMS
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
12
SCHEDULE A
[SCHEDULE OF ADJUSTMENTS]*
Initial Principal Amount: U.S. $
Notation made
Principal on behalf of
Date Principal Principal Amount the Security
adjustment amount amount following Exchange
made increase decrease adjustment Agent/Registrar
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*Insert if Exchange Note is a Global Security
13
EXHIBIT A.2
FORM OF FACE OF REGULATION S GLOBAL SENIOR SECURED NOTE DUE
2001
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS HELD BY THE DEPOSITORY TRUST COMPANY
(THE "DEPOSITARY") OR A NOMINEE OF THE DEPOSITARY. THIS SECURITY IS EXCHANGEABLE
FOR SECURITIES HELD BY A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITARY TO
A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY
OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO
A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY) MAY BE MADE
EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS GLOBAL SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITARY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY DEFINITIVE SECURITY IS ISSUED IN THE NAME
OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITARY (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER
ENTITY AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL IN AS MUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
THIS SECURITY (OR ITS PREDECESSOR) HAS BEEN ISSUED IN RELIANCE
ON REGULATION S UNDER THE SECURITIES ACT AND SHALL BEAR THE FOLLOWING LEGEND
UNTIL REMOVABLE IN ACCORDANCE WITH ITS TERMS AND THE TERMS OF THE INDENTURE.
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT
FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), AND, ACCORDINGLY, THIS SECURITY MAY NOT BE OFFERED OR
SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY
NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A AND
REGULATION S THEREUNDER.
BY ITS ACQUISITION HEREOF, EACH OF THE HOLDER OF THIS SECURITY
AND ANY OWNERS OF INTERESTS HEREIN, FOR THE BENEFIT OF THE COMPANY, (1)
REPRESENTS THAT IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN
OFFSHORE TRANSACTION, (2) AGREES THAT BEGINNING FROM THE LATER OF (X) THE
ORIGINAL ISSUE DATE OF THIS SECURITY OR (Y) THE LAST DATE ON WHICH THE COMPANY
OR ANY AFFILIATE THEREOF WAS THE BENEFICIAL OWNER OF THIS SECURITY (OR ANY
PREDECESSOR HEREOF) THROUGH THE TIME PERIOD REFERRED TO IN RULE 144(K) UNDER THE
SECURITIES ACT, IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT
(A) TO THE COMPANY OR ANY AFFILIATE THEREOF, (B) IN THE UNITED STATES TO A
PERSON WHOM THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (C) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (D) PURSUANT
TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, IN EACH OF CASES (A) TO (E) IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND (3) AGREES THAT
IT WILL, AND EACH SUBSEQUENT HOLDER WILL BE REQUIRED TO, DELIVER TO EACH PERSON
TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND ON THESE RESALE RESTRICTIONS.
THE RIGHTS ATTACHED TO THIS REGULATION S TEMPORARY GLOBAL
SECURITY, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR
DEFINITIVE SECURITIES, ARE AS SPECIFIED IN THE INDENTURE.
PRIOR TO THE COMMENCEMENT OF THE REGISTERED EXCHANGE OFFER OR
THE EFFECTIVENESS OF THE SHELF REGISTRATION STATEMENT, TRANSFERS OF INTERESTS IN
THIS REGULATION S GLOBAL SECURITY TO U.S. PERSONS SHALL BE LIMITED TO TRANSFERS
TO QUALIFIED INSTITUTIONAL BUYERS PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT.
UNLESS THE COMPANY DETERMINES OTHERWISE IN ACCORDANCE WITH
APPLICABLE LAW, THIS LEGEND WILL BE REMOVED BY THE COMPANY FOLLOWING THE
EXPIRATION OF 40 CONSECUTIVE DAYS BEGINNING ON AND INCLUDING THE LATER OF (A)
THE DAY ON WHICH INTERESTS IN THIS SECURITY ARE OFFERED TO PERSONS OTHER THAN
DISTRIBUTORS (AS DEFINED IN REGULATION S) AND (B) THE ORIGINAL ISSUE DATE OF
THIS SECURITY. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES"
AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE
SECURITIES ACT.
MIDAMERICAN FUNDING, LLC
6.339% Senior Secured Notes due 2001
No. ____ $____________
ISIN No. US59562HAG39
MIDAMERICAN FUNDING, LLC, a limited liability company
organized under the laws of Iowa (herein called the "Company," which term
includes any successor corporation or limited liability company under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to CEDE & Co., or registered assigns, the principal amount of [ ] Million
Dollars (such principal amount, as it may from time to time be adjusted by
endorsement on Schedule A hereto, is hereinafter referred to as the "Principal
Amount"), on March 1, 2001, and to pay interest thereon from March 11, 1999, or
from the most recent Interest Payment Date to which interest has been paid or
duly provided for, semi-annually on March 1 and September 1 in each year,
commencing September 1, 1999 at the rate of 5.85% per annum, until the Principal
Amount hereof is paid or made available for payment; provided that any Principal
Amount and premium, and any such installment of interest, which is overdue shall
continue to bear interest at the aforesaid rate of 5.85% per annum (to the
extent that the payment of such interest shall be legally enforceable) from the
dates such amounts are due until they are paid or made available for payment.
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in such Indenture, be paid to the Person
in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest, which shall be the February 15 or August 15 (whether or not a Business
Day), as the case may be, immediately preceding such Interest Payment Date. Any
such interest not so punctually paid or duly provided for will forthwith cease
to be payable to the Person in whose name this Security (or one or more
Predecessor Securities) is registered on such Regular Record Date and may be
paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof shall be given to Holders of Securities of this series not less than 10
days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities of this series may be listed, and upon such notice as
may be required by such exchange, all as more fully provided in said Indenture.
If an Illiquidity Event (as defined in the Registration Rights Agreement)
occurs, interest will accrue on this Security at a rate of 6.839% per annum from
and including the date on which any such Illiquidity Event shall occur, until
but excluding the date on which all Illiquidity Events shall cease to exist or
shall otherwise have been cured; provided, however, that if such Illiquidity
Event has not ceased to exist or is not otherwise cured within two years after
the consummation of the MidAmerican Merger (as defined in the Indenture), such
increase in interest rate will become permanent.
Payment of the principal of (and premium, if any) and interest
on this Security shall be made at the office or agency of the Company maintained
for that purpose in the Borough of Manhattan, The City of New York, or at such
additional offices or agencies as the Company from time to time may designate
for such purpose, in such coin or currency of the United States of America as at
the time of payment is legal tender for the payment of public and private debts,
provided, however, that, at the option of the Company, payment of the interest
on this Security may be made only upon presentation and surrender hereof at any
such office or agency and, at the option of the Company, payment of interest may
be made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register. Payment of interest, if any, in
respect of this Security may also be made, in the case of a Holder of at least
U.S. $1,000,000 aggregate principal amount of Securities, by wire transfer to a
U.S. Dollar account maintained by the Holder with a bank in the United States;
provided that such Holder elects payment by wire transfer by giving written
notice to the Trustee or Paying Agent to such effect designating such account no
later than 15 days immediately preceding the relevant due date for payment (or
such other date as the Trustee may accept in its discretion).
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS
SECURITY SET FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL
PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
MIDAMERICAN FUNDING, LLC
By: ________________________________
Name:
Title:
Attest:
By:__________________
Name:
Title:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein
and referred to in the within-mentioned Indenture.
IBJ WHITEHALL BANK & TRUST COMPANY
as Trustee
Dated:______________ By: ________________________________
Authorized Signatory
FORM OF REVERSE OF REGULATION S GLOBAL SENIOR SECURED NOTE DUE 2001
MIDAMERICAN FUNDING, LLC
5.85% Senior Secured Notes due 2001
1. GENERAL
This Security is one of a duly authorized issue of securities
of the Company (herein called the "Securities"), issued and to be issued in one
or more series under an Indenture, dated as of March 11, 1999 (herein called the
"Original Indenture"), between the Company and IBJ Whitehall Bank & Trust
Company as trustee (herein called the "Trustee," which term includes any
successor trustee under the Original Indenture), as supplemented by the First
Supplemental Indenture, dated as of March 11, 1999 (together with the Original
Indenture, the "Indenture") between the Company and the Trustee, to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Securities and of
the terms upon which the Securities are, and are to be, authenticated and
delivered. Terms defined in the Indenture which are not defined herein are used
with the meanings assigned to them in the Indenture. This Security is one of the
series designated on the face hereof, limited in aggregate principal amount to
$200,000,000.
2. OPTIONAL REDEMPTION
The Securities of this series will be redeemable in whole or
in part, at the option of the Company at any time, at a Redemption Price equal
to the greater of (i) 100% of the principal amount of the Securities of this
series being redeemed or (ii) the sum of the present values of the remaining
scheduled payments of principal of and interest on the Securities of this series
being redeemed discounted to the Redemption Date on a semiannual basis (assuming
a 360-day year consisting of twelve 30-day months) at a discount rate equal to
the Treasury Yield plus 0 basis points, plus, for (i) or (ii) above, whichever
is applicable, accrued interest on the Securities of this series to the
Redemption Date.
"Treasury Yield" means, with respect to any Redemption Date,
the rate per annum equal to the semiannual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such Redemption Date.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the Securities of this series to be redeemed
that would be utilized, at the time of selection and in accordance with
customary financial practice, in pricing new issues of corporate debt securities
of comparable maturity to the remaining term of the Securities of this series.
"Comparable Treasury Price" means, with respect to any
Redemption Date, (i) the average of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
on the third Business Day in New York City preceding such Redemption Date, as
set forth in the daily statistical release (or any successor release) published
by the Federal Reserve Bank of New York and designated "Composite 3:30 p.m.
Quotations for U.S. Government Securities" or (ii) if such release (or any
successor release) is not published or does not contain such prices on such
Business Day, the Reference Treasury Dealer Quotation for such Redemption Date.
"Independent Investment Banker" means an investment banking
institution of international standing appointed by the Company.
"Reference Treasury Dealer" means a primary U.S. Government
securities dealer in New York City appointed by the Company.
"Reference Treasury Dealer Quotation" means, with respect to
the Reference Treasury Dealer and any Redemption Date, the average, as
determined by the Company, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount
and quoted in writing to the Company by such Reference Treasury Dealer at 5:00
p.m. on the third Business Day in New York City preceding such Redemption Date).
Notice of redemption pursuant to this paragraph 2 shall be
given as provided for in the Indenture not less than 30 days nor more than 60
days prior to the Redemption Date.
If fewer than all the Securities of this series are to be
redeemed, selection of Securities of this series for redemption will be made by
the Trustee in any manner the Trustee deems fair and appropriate.
The Trustee may conclusively rely on an Officers' Certificate
setting forth the calculation of the Redemption Price, which Officers'
Certificate shall be delivered to the Trustee prior to the Redemption Date.
Unless the Company defaults in payment of the Redemption Price,
from and after the Redemption Date, the Securities of this series or portions
thereof called for redemption will cease to bear interest, and the Holders
thereof will have no right in respect of such Securities of this series except
the right to receive the Redemption Price thereof.
In the event of redemption of this Security in part only, the
Trustee will reduce the Principal Amount hereof by endorsement on Schedule A
hereto such that the Principal Amount shown on Schedule A after such endorsement
will reflect only the unredeemed portion hereof.
3. MANDATORY REDEMPTION
In the event that (i) the MidAmerican Merger is not
consummated on or prior to September 7, 1999 or (ii) CalEnergy elects to abandon
the MidAmerican Merger, or the MidAmerican Merger Agreement is terminated, in
either case, on or prior to September 7, 1999, for any reason, the Company shall
redeem all the Securities on the Mandatory Redemption Date, in cash at a
redemption price (the "Mandatory Redemption Price") equal to the aggregate
principal amount thereof plus accrued and unpaid interest thereon to the earlier
of (a) September 27, 1999, in the event that the MidAmerican Merger is not
consummated on or prior to September 7, 1999 or (b) the 20th day (or if such day
is not a Business Day, the first Business Day thereafter) following the
occurrence of an event described in (ii) above (such earlier date being referred
to herein as the "Mandatory Redemption Date").
Notice of Redemption pursuant to this paragraph 3 shall be
given as provided for in the Indenture promptly after the occurrence of the
event triggering such mandatory redemption.
Unless the Company defaults in payment of the Mandatory
Redemption Price, from and after the Mandatory Redemption Date, the Securities
of this series will cease to bear interest, and the Holders thereof will have no
right in respect of such Securities of this series except the right to receive
the Mandatory Redemption Price thereof.
4. DEFEASANCE
The Indenture contains provisions for defeasance of (a) the
entire indebtedness of this Security and (b) certain restrictive covenants upon
compliance by the Company with certain conditions set forth therein.
5. DEFAULTS AND REMEDIES
If an Event of Default with respect to Securities of this
series shall occur and be continuing, the principal of the Securities of this
series may be declared due and payable in the manner and with the effect
provided in the Indenture. At any time after such declaration of acceleration
with respect to Securities of this series has been made, but before a judgment
or decree for payment of money has been obtained by the Trustee as provided in
the Indenture, if all Events of Default with respect to Securities of this
series have been cured or waived (other than the non-payment of principal of the
Securities of this series which has become due solely by reason of such
declaration of acceleration) then and in every such case, the Holders of a
majority in aggregate principal amount of the Outstanding securities under the
Indenture may, by written
notice to the Company and to the Trustee, rescind and annul such declaration and
its consequences on behalf of all of the Holders, but no such recision or
annulment shall extend to or affect any subsequent default or impair any right
consequent thereon.
As provided in and subject to the provisions of the Indenture,
the Holder of this Security shall not have the right to institute any
proceeding, judicial or otherwise, with respect to the Indenture, or for the
appointment of a receiver, or trustee or for any other remedy thereunder, unless
(a) such Holder shall have previously given the Trustee written notice of a
continuing Event of Default with respect to the securities, (b) the Holders of
not less than 33% or a majority, as applicable, in principal amount of the
Securities at the time Outstanding under the Indenture shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee, (c) such Holder shall have offered the Trustee indemnity
satisfactory to the Trustee against the costs, expenses and liabilities to be
incurred in compliance with such request, (d) the Trustee shall not have
received from the Holders of a majority in principal amount of Securities at the
time Outstanding under the Indenture a direction inconsistent with such request
and (e) the Trustee for 90 days after its receipt of such notice from the
Holder, request and offer of indemnity shall have failed to institute any such
proceeding. The foregoing shall not apply to certain suits described in the
Indenture, including any suit instituted by the Holder of this Security for the
enforcement of any payment of principal hereof or any premium or interest hereon
on or after the respective due dates expressed herein.
6. AMENDMENT AND WAIVER
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the Indenture or any
supplemental indenture or the rights and obligations of the Company and rights
of the Holders of the Securities of any series at any time by the Company and
the Trustee with the consent of the Holders of a majority in aggregate principal
amount of the Securities at the time Outstanding of each series to be affected.
The Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor on in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of (and
premium, if any) and interest, if any, on this Security at the times, place and
rate, and in the coin or currency, herein prescribed.
7. TRANSFER AND EXCHANGE; DENOMINATIONS
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of a Security of the series of which this
Security is a part is registrable in the Security Register, upon surrender of
this Security for registration of transfer at the office or agency of the
Company in the Borough of Manhattan, The City of New York, (which initially
shall be the corporate trust office of the Trustee), duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities,
of authorized denominations and for the same aggregate principal amount, shall
be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered
form, without coupons, in denominations of $1,000 and any integral multiple
thereof. As provided in the Indenture and subject to certain limitations therein
set forth, Securities of this series are exchangeable for a like aggregate
principal amount of Securities of this series and of like tenor of a different
authorized denomination as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
8. SUCCESSOR OBLIGORS
When a successor assumes all the obligations of its predecessor
under the Securities of this series and the Indenture in accordance with the
terms of the Indenture, the predecessor will be released from those obligations.
9. TRUSTEE DEALINGS WITH THE COMPANY
The Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Securities of this series and
may otherwise deal with the Company, its Subsidiaries or their respective
Affiliates as if it were not the Trustee.
10. NO RECOURSE AGAINST OTHERS
No stockholder, director, officer, employee, incorporator or
Affiliate of the Company shall have any liability for any obligation of the
Company under the Securities of this series or the Indenture or for any claim
based on, in respect of or by reason of, such obligations or their creation.
Each Holder of the Securities of this series by accepting a Security of this
series waives and releases all such liability. The waiver and release are part
of the consideration for the issuance of the Securities of this series.
11. AUTHENTICATION
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
12. ISIN NUMBER AND COMMON CODE
This Security will bear an ISIN number and a Common Code. No
representation is made as to the accuracy of such numbers as printed on the
Securities of this series and reliance may be placed only on the other
identification numbers printed hereon.
13. GOVERNING LAW
This Security shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to the principles
of conflict of laws thereof.
14. DEFINED TERMS
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
SCHEDULE A
SCHEDULE OF ADJUSTMENTS
Initial Principal Amount: U.S. $
Notation made
Principal on behalf of
Date Principal Principal Amount the Security
adjustment amount amount following Exchange
made increase decrease adjustment Agent/Registrar
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EXHIBIT A.3
FORM OF FACE OF RESTRICTED DEFINITIVE SENIOR SECURED NOTE DUE 2001
THIS SECURITY HAS BEEN INITIALLY RESOLD TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" (AS DESCRIBED BY RULE 501(a)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT) AND SHALL BEAR THE FOLLOWING LEGEND UNTIL REMOVABLE IN
ACCORDANCE WITH ITS TERMS AND THE TERMS OF THE INDENTURE. THIS SECURITY (OR ITS
PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, THIS SECURITY MAY NOT BE OFFERED OR SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM.
BY ITS ACQUISITION HEREOF, EACH OF THE HOLDER OF THIS SECURITY
AND ANY OWNERS OF INTERESTS HEREIN, FOR THE BENEFIT OF THE COMPANY, (1)
REPRESENTS THAT IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" DESCRIBED BY RULE
501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT, (2) AGREES THAT BEGINNING
FROM THE LATER OF (X) THE ORIGINAL ISSUE DATE OF THIS SECURITY OR (Y) THE LAST
DATE ON WHICH THE COMPANY OR ANY AFFILIATE THEREOF WAS THE BENEFICIAL OWNER OF
THIS SECURITY (OR ANY PREDECESSOR HEREOF) THROUGH THE TIME PERIOD REFERRED TO IN
RULE 144(K) UNDER THE SECURITIES ACT, IT WILL NOT RESELL OR OTHERWISE TRANSFER
THIS SECURITY EXCEPT (A) TO THE COMPANY OR ANY AFFILIATE THEREOF, (B) IN THE
UNITED STATES TO A PERSON WHOM THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (C) OUTSIDE THE UNITED STATES
IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT,
(D) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED
BY RULE 144 THEREUNDER (IF AVAILABLE) OR (E) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (A) TO (E) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES
AND (3) AGREES THAT IT WILL, AND EACH SUBSEQUENT HOLDER WILL BE REQUIRED TO,
DELIVER TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND ON THESE RESALE RESTRICTIONS.
UNLESS THE COMPANY DETERMINES OTHERWISE IN ACCORDANCE WITH
APPLICABLE LAW, THIS LEGEND WILL BE REMOVED BY THE COMPANY UPON REQUEST OF THE
HOLDER, AFTER THE EXPIRATION OF THE TIME PERIOD
REFERRED TO IN RULE 144(K) UNDER THE SECURITIES ACT BEGINNING FROM THE LATER OF
(A) THE ORIGINAL ISSUE DATE OF THIS SECURITY AND (B) THE LAST DATE ON WHICH THE
COMPANY OR ANY AFFILIATE THEREOF WAS THE BENEFICIAL OWNER OF THIS SECURITY (OR
ANY PREDECESSOR HEREOF).
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO
THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH
TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH
THE FOREGOING RESTRICTIONS.
MIDAMERICAN FUNDING, LLC
5.85% Senior Secured Notes due 2001
$_____________
No. ___ CUSIP No. ▇▇▇▇▇▇▇▇ 08
MIDAMERICAN FUNDING, LLC, a limited liability company
organized under the laws of Iowa (herein called the "Company," which term
includes any successor corporation or limited liability company under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to ______, or registered assigns, the principal amount of 11 Million Dollars
(the "Principal Amount") on March 1, 2001, and to pay interest thereon from
March 11, 1999, or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, semi-annually on March 1 and September 1 in
each year, commencing September 1, 1999 at the rate of 5.85% per annum, until
the Principal Amount hereof is paid or made available for payment; provided that
any Principal Amount and premium, and any such installment of interest, which is
overdue shall continue to bear interest at the aforesaid rate of 5.85% per annum
(to the extent that the payment of such interest shall be legally enforceable)
from the dates such amounts are due until they are paid or made available for
payment. The interest so payable, and punctually paid or duly provided for, on
any Interest Payment Date will, as provided in such Indenture, be paid to the
Person in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest, which shall be the February 15 or August 15 (whether or not a Business
Day), as the case may be, immediately preceding such Interest Payment Date. Any
such interest not so punctually paid or duly provided for will forthwith cease
to be payable to the Person in whose name this Security (or one or more
Predecessor Securities) is registered on such Regular Record Date and may be
paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof shall be given to Holders of Securities of this series not less than 10
days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities of this series may be listed, and upon such notice as
may be required by such exchange, all as more fully provided in said Indenture.
If an Illiquidity Event (as defined in the Registration Rights Agreement)
occurs, interest will accrue on this Security at a rate of 6.35%per annum from
and including the date on which any such Illiquidity Event shall occur, until
but excluding the date on which all Illiquidity Events shall cease to exist or
shall otherwise have been cured, provided, however, that if such Illiquidity
Event has not ceased to exist or is not otherwise cured within two years after
the consummation of the MidAmerican Merger (as defined in the Indenture), such
increase in interest rate will become permanent.
Payment of the principal of (and premium, if any) and interest
on this Security shall be made at the office or agency of the Company maintained
for that purpose in the Borough of Manhattan, The City of New York, or at such
additional offices or agencies as the Company
from time to time may designate for such purpose, in such coin or currency of
the United States of America as at the time of payment is legal tender for the
payment of public and private debts, provided, however, that, at the option of
the Company, payment of the interest on this Security may be made only upon
presentation and surrender hereof at any such office or agency and, at the
option of the Company, payment of interest may be made by check mailed to the
address of the Person entitled thereto as such address shall appear in the
Security Register. Payment of interest, if any, in respect of this Security may
also be made, in the case of a Holder of at least U.S. $1,000,000 aggregate
principal amount of Securities, by wire transfer to a U.S. Dollar account
maintained by the Holder with a bank in the United States; provided that such
Holder elects payment by wire transfer by giving written notice to the Trustee
or Paying Agent to such effect designating such account no later than 15 days
immediately preceding the relevant due date for payment (or such other date as
the Trustee may accept in its discretion).
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS
SECURITY SET FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL
PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
MIDAMERICAN FUNDING, LLC
By: ________________________________
Name:
Title:
Attest:
By: __________________________
Name:
Title:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein
and referred to in the within-mentioned Indenture.
IBJ WHITEHALL BANK & TRUST COMPANY
as Trustee
Dated:______________ By: ________________________________
Authorized Signatory
FORM OF REVERSE OF RESTRICTED DEFINITIVE SENIOR NOTE DUE 2001
MIDAMERICAN FUNDING, LLC
5.85% Senior Secured Notes due 2001
1. GENERAL
This Security is one of a duly authorized issue of securities
of the Company (herein called the "Securities"), issued and to be issued in one
or more series under an Indenture, dated as of March 11, 1999 (herein called the
"Original Indenture"), between the Company and IBJ Whitehall Bank & Trust
Company as trustee (herein called the "Trustee," which term includes any
successor trustee under the Original Indenture), as supplemented by the First
Supplemental Indenture, dated as of March 11, 1999 (together with the Original
Indenture, the "Indenture") between the Company and the Trustee, to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Securities and of
the terms upon which the Securities are, and are to be, authenticated and
delivered. Terms defined in the Indenture which are not defined herein are used
with the meanings assigned to them in the Indenture. This Security is one of the
series designated on the face hereof, limited in aggregate principal amount to
$200,000,000.
2. OPTIONAL REDEMPTION
The Securities of this series will be redeemable in whole or in
part, at the option of the Company at any time, at a Redemption Price equal to
the greater of (i) 100% of the principal amount of the Securities of this series
being redeemed or (ii) the sum of the present values of the remaining scheduled
payments of principal of and interest on the Securities of this series being
redeemed discounted to the Redemption Date on a semiannual basis (assuming a
360-day year consisting of twelve 30-day months) at a discount rate equal to the
Treasury Yield plus 0 basis points, plus, for (i) or (ii) above, whichever is
applicable, accrued interest on the Securities of this series to the Redemption
Date.
"Treasury Yield" means, with respect to any Redemption Date,
the rate per annum equal to the semiannual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such Redemption Date.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the Securities of this series to be redeemed
that would be utilized, at the time of selection and in accordance with
customary financial practice, in pricing new issues of corporate debt securities
of comparable maturity to the remaining term of the Securities of this series.
"Comparable Treasury Price" means, with respect to any
Redemption Date, (i) the average of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
on the third Business Day in New York City preceding such Redemption Date, as
set forth in the daily statistical release (or any successor release) published
by the Federal Reserve Bank of New York and designated "Composite 3:30 p.m.
Quotations for U.S. Government Securities" or (ii) if such release (or any
successor release) is not published or does not contain such prices on such
Business Day, the Reference Treasury Dealer Quotation for such Redemption Date.
"Independent Investment Banker" means an investment banking
institution of international standing appointed by the Company.
"Reference Treasury Dealer" means a primary U.S. Government
securities dealer in New York City appointed by the Company.
"Reference Treasury Dealer Quotation" means, with respect to
the Reference Treasury Dealer and any Redemption Date, the average, as
determined by the Company, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount
and quoted in writing to the Company by such Reference Treasury Dealer at 5:00
p.m. on the third Business Day in New York City preceding such Redemption Date).
Notice of redemption pursuant to this paragraph 2 shall be
given as provided for in the Indenture not less than 30 days nor more than 60
days prior to the Redemption Date.
If fewer than all the Securities of this series are to be
redeemed, selection of Securities of this series for redemption will be made by
the Trustee in any manner the Trustee deems fair and appropriate.
The Trustee may conclusively rely on an Officers' Certificate
setting forth the calculation of the Redemption Price, which Officers'
Certificate shall be delivered to the Trustee prior to the Redemption Date.
Unless the Company defaults in payment of the Redemption Price,
from and after the Redemption Date, the Securities of this series or portions
thereof called for redemption will cease to bear interest, and the Holders
thereof will have no right in respect of such Securities of this series except
the right to receive the Redemption Price thereof.
3. MANDATORY REDEMPTION
In the event that (i) the MidAmerican Merger is not consummated
on or prior to September 7, 1999 or (ii) CalEnergy elects to abandon
the MidAmerican Merger, or the MidAmerican Merger Agreement is terminated, in
either case, on or prior to September 7, 1999, for any reason, the Company shall
redeem all the Securities on the Mandatory Redemption Date, in
cash at a redemption price (the "Mandatory Redemption Price") equal to the
aggregate principal amount thereof plus accrued and unpaid interest thereon to
the earlier of (a) September 27, 1999, in the event that the MidAmerican Merger
is not consummated on or prior to September 7, 1999 or (b) the 20th day (or if
such day is not a Business Day, the first Business Day thereafter) following the
occurrence of an event described in (ii) above (such earlier date being referred
to herein as the "Mandatory Redemption Date").
Notice of Redemption pursuant to this paragraph 3 shall be
given as provided for in the Indenture promptly after the occurrence of the
event triggering such mandatory redemption.
Unless the Company defaults in payment of the Mandatory
Redemption Price, from and after the Mandatory Redemption Date, the Securities
of this series will cease to bear interest, and the Holders thereof will have no
right in respect of such Securities of this series except the right to receive
the Mandatory Redemption Price thereof.
4. DEFEASANCE
The Indenture contains provisions for defeasance of (a) the
entire indebtedness of this Security and (b) certain restrictive covenants upon
compliance by the Company with certain conditions set forth therein.
5. DEFAULTS AND REMEDIES
If an Event of Default with respect to Securities of this
series shall occur and be continuing, the principal of the Securities of this
series may be declared due and payable in the manner and with the effect
provided in the Indenture. At any time after such declaration of acceleration
with respect to Securities of this series has been made, but before a judgment
or decree for payment of money has been obtained by the Trustee as provided in
the Indenture, if all Events of Default with respect to Securities of this
series have been cured or waived (other than the non-payment of principal of the
Securities of this series which has become due solely by reason of such
declaration of acceleration) then and in every such case, the Holders of a
majority in aggregate principal amount of the Outstanding securities under the
Indenture may, by written notice to the Company and to the Trustee, rescind and
annul such declaration and its consequences on behalf of all of the Holders, but
no such recision or annulment shall extend to or affect any subsequent default
or impair any right consequent thereon.
As provided in and subject to the provisions of the Indenture,
the Holder of this Security shall not have the right to institute any
proceeding, judicial or otherwise, with respect to the Indenture, or for the
appointment of a receiver, or trustee or for any other remedy thereunder, unless
(a) such Holder shall have previously given the Trustee written notice of a
continuing Event of Default with respect to the Securities, (b) the Holders of
not less than 33% or a majority, as applicable, in principal amount of the
Securities at the time Outstanding under the Inden-
ture shall have made written request to the Trustee to institute proceedings in
respect of such Event of Default as Trustee, (c) such Holder shall have offered
the Trustee indemnity satisfactory to the Trustee against the costs, expenses
and liabilities to be incurred in compliance with such request, (d) the Trustee
shall not have received from the Holders of a majority in principal amount of
Securities at the time Outstanding under the Indenture a direction inconsistent
with such request and (e) the Trustee for 90 days after its receipt of such
notice from the Holder, request and offer of indemnity shall have failed to
institute any such proceeding. The foregoing shall not apply to certain suits
described in the Indenture, including any suit instituted by the Holder of this
Security for the enforcement of any payment of principal hereof or any premium
or interest hereon on or after the respective due dates expressed herein.
6. AMENDMENT AND WAIVER
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the Indenture or any
supplemental indenture or the rights and obligations of the Company and rights
of the Holders of the Securities of any series at any time by the Company and
the Trustee with the consent of the Holders of a majority in aggregate principal
amount of the Securities at the time Outstanding of each series to be affected.
The Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor on in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of (and
premium, if any) and interest, if any, on this Security at the times, place and
rate, and in the coin or currency, herein prescribed.
7. TRANSFER AND EXCHANGE; DENOMINATIONS
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in the Borough of Manhattan, The City of New
York, (which initially shall be the corporate trust office of the Trustee), duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Securities, of authorized denominations and for the same aggregate
principal amount, shall be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered
form, without coupons, in denominations of $1,000 and any integral multiple of
$1,000 in excess thereof. As provided in the Indenture and subject to certain
limitations therein set forth, Securities of this series are exchangeable for a
like aggregate principal amount of Securities of this series and of like tenor
of a different authorized denomination as requested by the Holder surrendering
the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
8. SUCCESSOR OBLIGORS
When a successor assumes all the obligations of its predecessor
under the Securities of this series and the Indenture in accordance with the
terms of the Indenture, the predecessor will be released from those obligations.
9. TRUSTEE DEALINGS WITH THE COMPANY
The Trustee under the Indenture, in its individual or any other
capacity, may become the owner or pledgee of Securities of this series and may
otherwise deal with the Company, its Subsidiaries or their respective Affiliates
as if it were not the Trustee.
10. NO RECOURSE AGAINST OTHERS
No stockholder, director, officer, employee, incorporator or
Affiliate of the Company shall have any liability for any obligation of the
Company under the Securities of this series or the Indenture or for any claim
based on, in respect of or by reason of, such obligations or their creation.
Each Holder of the Securities of this series by accepting a Security of this
series waives and releases all such liability. The waiver and release are part
of the consideration for the issuance of the Securities of this series.
11. AUTHENTICATION
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
12. CUSIP NUMBERS
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company will cause CUSIP numbers
to be printed on the Securities of this series as a convenience to the Holders
of the Securities of this series.
13. GOVERNING LAW
This Security shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to the principles
of conflict of laws thereof.
14. DEFINED TERMS
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
EXHIBIT B.1
FORM OF FACE OF RULE 144A GLOBAL SENIOR SECURED NOTE DUE 2009
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS HELD BY THE DEPOSITORY TRUST COMPANY
(THE "DEPOSITARY") OR A NOMINEE OF THE DEPOSITARY. THIS SECURITY IS EXCHANGEABLE
FOR SECURITIES HELD BY A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITARY TO
A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY
OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO
A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY) MAY BE MADE
EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS GLOBAL SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITARY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY DEFINITIVE SECURITY IS ISSUED IN THE NAME
OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITARY (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER
ENTITY AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL IN AS MUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
THIS SECURITY (OR ITS PREDECESSOR) HAS BEEN INITIALLY RESOLD
IN RELIANCE ON RULE 144A UNDER THE SECURITIES ACT AND SHALL BEAR THE FOLLOWING
LEGEND UNTIL REMOVABLE IN ACCORDANCE WITH ITS TERMS AND THE TERMS OF THE
INDENTURE. THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, THIS SECURITY MAY NOT
BE OFFERED OR SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION
OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY
NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A AND
REGULATION S THEREUNDER.
BY ITS ACQUISITION HEREOF, EACH OF THE HOLDER OF THIS SECURITY
AND ANY OWNERS OF INTERESTS HEREIN, FOR THE BENEFIT OF THE COMPANY, (1)
REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT), (2) AGREES THAT BEGINNING FROM THE LATER OF (X) THE
ORIGINAL ISSUE DATE OF THIS SECURITY OR (Y) THE LAST DATE ON WHICH THE COMPANY
OR ANY AFFILIATE THEREOF WAS THE BENEFICIAL OWNER OF THIS SECURITY (OR ANY
PREDECESSOR HEREOF) THROUGH THE TIME PERIOD REFERRED TO IN RULE 144(K) UNDER THE
SECURITIES ACT, IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT
(A) TO THE COMPANY OR ANY AFFILIATE THEREOF, (B) IN THE UNITED STATES TO A
PERSON WHOM THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (C) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (D) PURSUANT
TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, IN EACH OF CASES (A) TO (E) IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND (3) AGREES THAT
IT WILL, AND EACH SUBSEQUENT HOLDER WILL BE REQUIRED TO, DELIVER TO EACH PERSON
TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND ON THESE RESALE RESTRICTIONS.
UNLESS THE COMPANY DETERMINES OTHERWISE IN ACCORDANCE WITH
APPLICABLE LAW, THIS LEGEND WILL BE REMOVED BY THE COMPANY UPON REQUEST OF THE
HOLDER, AFTER THE EXPIRATION OF THE TIME PERIOD REFERRED TO IN RULE 144(K) UNDER
THE SECURITIES ACT BEGINNING FROM THE LATER OF (A) THE ORIGINAL ISSUE DATE OF
THIS SECURITY AND (B) THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE
THEREOF WAS THE BENEFICIAL OWNER OF THIS SECURITY (OR ANY PREDECESSOR HEREOF).
MIDAMERICAN FUNDING, LLC
6.339% Senior Secured Notes due 2009
$______________
No. ___ CUSIP No. 59562H AB 4
MIDAMERICAN FUNDING, LLC, a limited liability company
organized under the laws of Iowa (herein called the "Company," which term
includes any successor corporation or limited liability company under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to CEDE & Co., or registered assigns, the principal amount of [ ] Million
Dollars (such principal amount, as it may from time to time be adjusted by
endorsement on Schedule A hereto, is hereinafter referred to as the "Principal
Amount") on March 1, 2009, and to pay interest thereon from March 11, 1999, or
from the most recent Interest Payment Date to which interest has been paid or
duly provided for, semi-annually on March 1 and September 1 in each year,
commencing September 1, 1999 at the rate of 6.339% per annum, until the
Principal Amount hereof is paid or made available for payment; provided that any
Principal Amount and premium, and any such installment of interest, which is
overdue shall continue to bear interest at the aforesaid rate of 6.339% per
annum (to the extent that the payment of such interest shall be legally
enforceable) from the dates such amounts are due until they are paid or made
available for payment. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in such Indenture,
be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest, which shall be the February 15 or August 15 (whether or not a
Business Day), as the case may be, immediately preceding such Interest Payment
Date. Any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Person in whose name this Security (or one
or more Predecessor Securities) is registered on such Regular Record Date and
may be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in said Indenture. If an Illiquidity Event (as defined in the Registration
Rights Agreement) occurs, interest will accrue on this Security at a rate of
6.859%per annum from and including the date on which any such Illiquidity Event
shall occur, until but excluding the date on which all Illiquidity Events shall
cease to exist or shall otherwise have been cured; provided, however, that if
such Illiquidity Event has not ceased to exist or is not otherwise cured within
two years after the consummation of the MidAmerican Merger (as defined in the
Indenture), such increase in interest rate will become permanent.
Payment of the principal of (and premium, if any) and interest
on this Security shall be made at the office or agency of the Company maintained
for that purpose in the Borough of Manhattan, The City of New York, or at such
additional offices or agencies as the Company from time to time may designate
for such purpose, in such coin or currency of the United States of America as at
the time of payment is legal tender for the payment of public and private debts,
provided, however, that, at the option of the Company, payment of the interest
on this Security may be made only upon presentation and surrender hereof at any
such office or agency and, at the option of the Company, payment of interest may
be made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register. Payment of interest, if any, in
respect of this Security may also be made, in the case of a Holder of at least
U.S. $1,000,000 aggregate principal amount of Securities, by wire transfer to a
U.S. Dollar account maintained by the Holder with a bank in the United States;
provided that such Holder elects payment by wire transfer by giving written
notice to the Trustee or Paying Agent to such effect designating such account no
later than 15 days immediately preceding the relevant due date for payment (or
such other date as the Trustee may accept in its discretion).
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS
SECURITY SET FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL
PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
4
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
MIDAMERICAN FUNDING, LLC
By: _______________________________
Name:
Title:
Attest:
By:_________________
Name:
Title:
5
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein
and referred to in the within-mentioned Indenture.
IBJ WHITEHALL BANK & TRUST COMPANY
as Trustee
Dated:______________ By: ________________________________
Authorized Signatory
6
FORM OF REVERSE OF RULE 144A GLOBAL SENIOR SECURED NOTE DUE 2009
MIDAMERICAN FUNDING, LLC
6.339% Senior Secured Notes due 2009
1. GENERAL
This Security is one of a duly authorized issue of Securities
of the Company (herein called the "Securities"), issued and to be issued in one
or more series under an Indenture, dated as of March 11, 1999 (herein called the
"Original Indenture"), between the Company and IBJ Whitehall Bank & Trust
Company, as trustee (herein called the "Trustee," which term includes any
successor trustee under the Original Indenture), as supplemented by the First
Supplemental Indenture, dated as of March 11, 1999 (together with the Original
Indenture, the "Indenture") between the Company and the Trustee, to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Securities and of
the terms upon which the Securities are, and are to be, authenticated and
delivered. Terms defined in the Indenture which are not defined herein are used
with the meanings assigned to them in the Indenture. This Security is one of the
series designated on the face hereof, limited in aggregate principal amount to
$175,000,000.
2. OPTIONAL REDEMPTION
The Securities of this series will be redeemable in whole or in
part, at the option of the Company at any time, at a Redemption Price equal to
the greater of (i) 100% of the principal amount of the Securities of this series
being redeemed or (ii) the sum of the present values of the remaining scheduled
payments of principal of and interest on the Securities of this series being
redeemed discounted to the Redemption Date on a semiannual basis (assuming a
360-day year consisting of twelve 30-day months) at a discount rate equal to the
Treasury Yield plus 15 basis points, plus, for (i) or (ii) above, whichever is
applicable, accrued interest on the Securities of this series to the Redemption
Date.
"Treasury Yield" means, with respect to any Redemption Date,
the rate per annum equal to the semiannual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such Redemption Date.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the Securities of this series to be redeemed
that would be utilized, at the time of selection and in accordance with
customary financial practice, in pricing new issues of corpo-
rate debt securities of comparable maturity to the remaining term of the
Securities of this series.
"Comparable Treasury Price" means, with respect to any
Redemption Date, (i) the average of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
on the third Business Day in New York City preceding such Redemption Date, as
set forth in the daily statistical release (or any successor release) published
by the Federal Reserve Bank of New York and designated "Composite 3:30 p.m.
Quotations for U.S. Government Securities" or (ii) if such release (or any
successor release) is not published or does not contain such prices on such
Business Day, the Reference Treasury Dealer Quotation for such Redemption Date.
"Independent Investment Banker" means an investment banking
institution of international standing appointed by the Company.
"Reference Treasury Dealer" means a primary U.S. Government
securities dealer in New York City appointed by the Company.
"Reference Treasury Dealer Quotation" means, with respect to
the Reference Treasury Dealer and any Redemption Date, the average, as
determined by the Company, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount
and quoted in writing to the Company by such Reference Treasury Dealer at 5:00
p.m. on the third Business Day in New York City preceding such Redemption Date).
Notice of redemption pursuant to this paragraph 2 shall be
given as provided for in the Indenture not less than 30 days nor more than 60
days prior to the Redemption Date.
If fewer than all the Securities of this series are to be
redeemed, selection of Securities of this series for redemption will be made by
the Trustee in any manner the Trustee deems fair and appropriate.
The Trustee may conclusively rely on an Officers' Certificate
setting forth the calculation of the Redemption Price, which Officers'
Certificate shall be delivered to the Trustee prior to the Redemption Date.
Unless the Company defaults in payment of the Redemption Price,
from and after the Redemption Date, the Securities of this series or portions
thereof called for redemption will cease to bear interest, and the Holders
thereof will have no right in respect of such Securities of this series except
the right to receive the Redemption Price thereof.
In the event of redemption of this Security in part only, the
Trustee will reduce the Principal Amount hereof by endorsement on Schedule A
hereto such that the Princi-
pal Amount shown on Schedule A after such endorsement will reflect only the
unredeemed portion hereof.
3. MANDATORY REDEMPTION
In the event that (i) the MidAmerican Merger is not
consummated on or prior to September 7, 1999 or (ii) CalEnergy elects to abandon
the MidAmerican Merger, or the MidAmerican Merger Agreement is terminated, in
either case, on or prior to September 7, 1999, for any reason, the Company shall
redeem all the Securities on the Mandatory Redemption Date, in cash at a
redemption price (the "Mandatory Redemption Price") equal to the aggregate
principal amount thereof plus accrued and unpaid interest thereon to the earlier
of (a) September 27, 1999, in the event that the MidAmerican Merger is not
consummated on or prior to September 7, 1999 or (b) the 20th day (or if such day
is not a Business Day, the first Business Day thereafter) following the
occurrence of an event described in (ii) above (such earlier date being referred
to herein as the "Mandatory Redemption Date").
Notice of Redemption pursuant to this paragraph 3 shall be
given as provided for in the Indenture promptly after the occurrence of the
event triggering such mandatory redemption.
Unless the Company defaults in payment of the Mandatory
Redemption Price, from and after the Mandatory Redemption Date, the Securities
of this series will cease to bear interest, and the Holders thereof will have no
right in respect of such Securities of this series except the right to receive
the Mandatory Redemption Price thereof.
4. DEFEASANCE
The Indenture contains provisions for defeasance of (a) the
entire indebtedness of this Security and (b) certain restrictive covenants upon
compliance by the Company with certain conditions set forth therein.
5. DEFAULTS AND REMEDIES
If an Event of Default with respect to Securities of this
series shall occur and be continuing, the principal of the Securities of
this series may be declared due and payable in the manner and with the effect
provided in the Indenture. At any time after such declaration of acceleration
with respect to Securities of this series has been made, but before a judgment
or decree for payment of money has been obtained by the Trustee as provided in
the Indenture, if all Events of Default with respect to Securities of this
series have been cured or waived (other than the non-payment of principal of the
Securities of this series which has become due solely by reason of such
declaration of acceleration) then and in every such case, the Holders of a
majority in aggregate principal amount of the Outstanding securities under the
Indenture may, by written notice to the Company and to the Trustee, rescind and
annul
such declaration and its consequences on behalf of all of the Holders, but no
such recision or annulment shall extend to or affect any subsequent default or
impair any right consequent thereon.
As provided in and subject to the provisions of the Indenture,
the Holder of this Security shall not have the right to institute any
proceeding, judicial or otherwise, with respect to the Indenture, or for the
appointment of a receiver, or trustee or for any other remedy thereunder, unless
(a) such Holder shall have previously given the Trustee written notice of a
continuing Event of Default with respect to the Securities, (b) the Holders of
not less than 33% or a majority, as applicable, in principal amount of the
Securities at the time Outstanding under the Indenture shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee, (c) such Holder shall have offered the Trustee indemnity
satisfactory to the Trustee against the costs, expenses and liabilities to be
incurred in compliance with such request, (d) the Trustee shall not have
received from the Holders of a majority in principal amount of Securities at the
time Outstanding under the Indenture a direction inconsistent with such request
and (e) the Trustee for 90 days after its receipt of such notice from the
Holder, request and offer of indemnity shall have failed to institute any such
proceeding. The foregoing shall not apply to certain suits described in the
Indenture, including any suit instituted by the Holder of this Security for the
enforcement of any payment of principal hereof or any premium or interest hereon
on or after the respective due dates expressed herein.
6. AMENDMENT AND WAIVER
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the Indenture or any
supplemental indenture or the rights and obligations of the Company and rights
of the Holders of the Securities of any series at any time by the Company and
the Trustee with the consent of the Holders of a majority in aggregate principal
amount of the Securities at the time Outstanding of each series to be affected.
The Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor on in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of (and
premium, if any) and interest, if any, on this Security at the times, place and
rate, and in the coin or currency, herein prescribed.
7. TRANSFER AND EXCHANGE; DENOMINATIONS
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of a Security of the series of which this
Security is a part is registrable in the Security Register, upon surrender of
this Security for registration of transfer at the office or agency of the
Company in the Borough of Manhattan, The City of New York, (which initially
shall be the corporate trust office of the Trustee), duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities,
of authorized denominations and for the same aggregate principal amount, shall
be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered
form, without coupons, in denominations of $1,000 and any integral multiple
thereof. As provided in the Indenture and subject to certain limitations therein
set forth, Securities of this series are exchangeable for a like aggregate
principal amount of Securities of this series and of like tenor of a different
authorized denomination as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
8. SUCCESSOR OBLIGORS
When a successor assumes all the obligations of its
predecessor under the Securities of this series and the Indenture in accordance
with the terms of the Indenture, the predecessor will be released from those
obligations.
9. TRUSTEE DEALINGS WITH THE COMPANY
The Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Securities of this series and
may otherwise deal with the Company, its Subsidiaries or their respective
Affiliates as if it were not the Trustee.
10. NO RECOURSE AGAINST OTHERS
No stockholder, director, officer, employee, incorporator or
Affiliate of the Company shall have any liability for any obligation of the
Company under the Securities of this series or the Indenture or for any claim
based on, in respect of or by reason of, such obligations or their creation.
Each Holder of the Securities of this series by accepting a Security of this
series waives and releases all such liability. The waiver and release are part
of the consideration for the issuance of the Securities of this series.
11. AUTHENTICATION
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
12. CUSIP NUMBERS
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company will cause CUSIP numbers
to be printed on the Securities of this series as a convenience to the Holders
of the Securities of this series.
13. GOVERNING LAW
This Security shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to the principles
of conflict of laws thereof.
14. DEFINED TERMS
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
SCHEDULE A
SCHEDULE OF ADJUSTMENTS
Initial Principal Amount: U.S. $
Notation made
Principal on behalf of
Date Principal Principal Amount the Security
adjustment amount amount following Exchange
made increase decrease adjustment Agent/Registrar
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EXHIBIT B.2
FORM OF FACE OF REGULATION S GLOBAL SENIOR SECURED NOTE DUE 2009
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS HELD BY THE DEPOSITORY TRUST COMPANY
(THE "DEPOSITARY") OR A NOMINEE OF THE DEPOSITARY. THIS SECURITY IS EXCHANGEABLE
FOR SECURITIES HELD BY A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITARY TO
A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY
OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO
A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY) MAY BE MADE
EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS GLOBAL SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITARY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY DEFINITIVE SECURITY IS ISSUED IN THE NAME
OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITARY (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER
ENTITY AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL IN AS MUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
THIS SECURITY (OR ITS PREDECESSOR) HAS BEEN ISSUED IN RELIANCE
ON REGULATION S UNDER THE SECURITIES ACT AND SHALL BEAR THE FOLLOWING LEGEND
UNTIL REMOVABLE IN ACCORDANCE WITH ITS TERMS AND THE TERMS OF THE INDENTURE.
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT
FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), AND, ACCORDINGLY, THIS SECURITY MAY NOT BE OFFERED OR
SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY
NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A AND
REGULATION S THEREUNDER.
BY ITS ACQUISITION HEREOF, EACH OF THE HOLDER OF THIS SECURITY
AND ANY OWNERS OF INTERESTS HEREIN, FOR THE BENEFIT OF THE COMPANY, (1)
REPRESENTS THAT IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN
OFFSHORE TRANSACTION, (2) AGREES THAT BEGINNING FROM THE LATER OF (X) THE
ORIGINAL ISSUE DATE OF THIS SECURITY OR (Y) THE LAST DATE ON WHICH THE COMPANY
OR ANY AFFILIATE THEREOF WAS THE BENEFICIAL OWNER OF THIS SECURITY (OR ANY
PREDECESSOR HEREOF) THROUGH THE TIME PERIOD REFERRED TO IN RULE 144(K) UNDER THE
SECURITIES ACT, IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT
(A) TO THE COMPANY OR ANY AFFILIATE THEREOF, (B) IN THE UNITED STATES TO A
PERSON WHOM THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (C) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (D) PURSUANT
TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, IN EACH OF CASES (A) TO (E) IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND (3) AGREES THAT
IT WILL, AND EACH SUBSEQUENT HOLDER WILL BE REQUIRED TO, DELIVER TO EACH PERSON
TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND ON THESE RESALE RESTRICTIONS.
THE RIGHTS ATTACHED TO THIS REGULATION S TEMPORARY GLOBAL
SECURITY, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR
DEFINITIVE SECURITIES, ARE AS SPECIFIED IN THE INDENTURE.
PRIOR TO THE COMMENCEMENT OF THE REGISTERED EXCHANGE OFFER OR
THE EFFECTIVENESS OF THE SHELF REGISTRATION STATEMENT, TRANSFERS OF INTERESTS IN
THIS REGULATION S GLOBAL SECURITY TO U.S. PERSONS SHALL BE LIMITED TO TRANSFERS
TO QUALIFIED INSTITUTIONAL BUYERS PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT.
UNLESS THE COMPANY DETERMINES OTHERWISE IN ACCORDANCE WITH
APPLICABLE LAW, THIS LEGEND WILL BE REMOVED BY THE COMPANY FOLLOWING THE
EXPIRATION OF 40 CONSECUTIVE DAYS BEGINNING ON AND INCLUDING THE LATER OF (A)
THE DAY ON WHICH INTERESTS IN THIS SECURITY ARE OFFERED TO PERSONS OTHER THAN
DISTRIBUTORS (AS DEFINED IN REGULATION S) AND (B) THE ORIGINAL ISSUE DATE OF
THIS SECURITY. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES"
AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE
SECURITIES ACT.
MIDAMERICAN FUNDING, LLC
6.339% Senior Secured Notes due 2009
No. ____ $____________
ISIN No. US59562 HAH 12
MIDAMERICAN FUNDING, LLC, a limited liability company
organized under the laws of Iowa (herein called the "Company," which term
includes any successor corporation or limited liability company under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to CEDE & Co., or registered assigns, the principal amount of [ ] Million
Dollars (such principal amount, as it may from time to time be adjusted by
endorsement on Schedule A hereto, is hereinafter referred to as the "Principal
Amount") on March 1, 2009, and to pay interest thereon from March 11, 1999, or
from the most recent Interest Payment Date to which interest has been paid or
duly provided for, semi-annually on March 1 and September 1 in each year,
commencing September 1, 1999 at the rate of 6.339% per annum, until the
Principal Amount hereof is paid or made available for payment; provided that any
Principal Amount and premium, and any such installment of interest, which is
overdue shall continue to bear interest at the aforesaid rate of 6.339% per
annum (to the extent that the payment of such interest shall be legally
enforceable) from the dates such amounts are due until they are paid or made
available for payment. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in such Indenture,
be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest, which shall be the February 15 or August 15 (whether or not a
Business Day), as the case may be, immediately preceding such Interest Payment
Date. Any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Person in whose name this Security (or one
or more Predecessor Securities) is registered on such Regular Record Date and
may be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in said Indenture. If an Illiquidity Event (as defined in the Registration
Rights Agreement) occurs, interest will accrue on this Security at a rate of
6.839 per annum from and including the date on which any such Illiquidity Event
shall occur, until but excluding the date on which all Illiquidity Events shall
cease to exist or shall otherwise have been cured; provided, however, that if
such Illiquidity Event has not ceased to exist or is not otherwise cured within
two years after the consummation of the MidAmerican Merger (as defined in the
Indenture), such increase in interest rate will become permanent.
Payment of the principal of (and premium, if any) and interest
on this Security shall be made at the office or agency of the Company maintained
for that purpose in the Borough of Manhattan, The City of New York, or at such
additional offices or agencies as the Company from time to time may designate
for such purpose, in such coin or currency of the United States of America as at
the time of payment is legal tender for the payment of public and private debts,
provided, however, that, at the option of the Company, payment of the interest
on this Security may be made only upon presentation and surrender hereof at any
such office or agency and, at the option of the Company, payment of interest may
be made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register. Payment of interest, if any, in
respect of this Security may also be made, in the case of a Holder of at least
U.S. $1,000,000 aggregate principal amount of Securities, by wire transfer to a
U.S. Dollar account maintained by the Holder with a bank in the United States;
provided that such Holder elects payment by wire transfer by giving written
notice to the Trustee or Paying Agent to such effect designating such account no
later than 15 days immediately preceding the relevant due date for payment (or
such other date as the Trustee may accept in its discretion).
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS
SECURITY SET FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL
PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
MIDAMERICAN FUNDING, LLC
By: ________________________________
Name:
Title:
Attest:
By:__________________
Name:
Title:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein
and referred to in the within-mentioned Indenture.
IBJ WHITEHALL BANK & TRUST COMPANY
as Trustee
Dated:______________ By: ________________________________
Authorized Signatory
FORM OF REVERSE OF REGULATION S GLOBAL SENIOR SECURED NOTE DUE 2009
MIDAMERICAN FUNDING, LLC
6.339% Senior Secured Notes due 2009
1. GENERAL
This Security is one of a duly authorized issue of securities
of the Company (herein called the "Securities"), issued and to be issued in one
or more series under an Indenture, dated as of March 11, 1999 (herein called the
"Original Indenture"), between the Company and IBJ Whitehall Bank & Trust
Company as trustee (herein called the "Trustee," which term includes any
successor trustee under the Original Indenture), as supplemented by the First
Supplemental Indenture, dated as of March 11, 1999 (together with the Original
Indenture, the "Indenture") between the Company and the Trustee, to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Securities and of
the terms upon which the Securities are, and are to be, authenticated and
delivered. Terms defined in the Indenture which are not defined herein are used
with the meanings assigned to them in the Indenture. This Security is one of the
series designated on the face hereof, limited in aggregate principal amount to
$175,000,000.
2. OPTIONAL REDEMPTION
The Securities of this series will be redeemable in whole or in
part, at the option of the Company at any time, at a Redemption Price equal to
the greater of (i) 100% of the principal amount of the Securities of this series
being redeemed or (ii) the sum of the present values of the remaining scheduled
payments of principal of and interest on the Securities of this series being
redeemed discounted to the Redemption Date on a semiannual basis (assuming a
360-day year consisting of twelve 30-day months) at a discount rate equal to the
Treasury Yield plus 15 basis points, plus, for (i) or (ii) above, whichever is
applicable, accrued interest on the Securities of this series to the Redemption
Date.
"Treasury Yield" means, with respect to any Redemption Date,
the rate per annum equal to the semiannual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such Redemption Date.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the Securities of this series to be redeemed
that would be utilized, at the time of selection and in accordance with
customary financial practice, in pricing new issues of corporate debt securities
of comparable maturity to the remaining term of the Securities of this series.
"Comparable Treasury Price" means, with respect to any
Redemption Date, (i) the average of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
on the third Business Day in New York City preceding such Redemption Date, as
set forth in the daily statistical release (or any successor release) published
by the Federal Reserve Bank of New York and designated "Composite 3:30 p.m.
Quotations for U.S. Government Securities" or (ii) if such release (or any
successor release) is not published or does not contain such prices on such
Business Day, the Reference Treasury Dealer Quotation for such Redemption Date.
"Independent Investment Banker" means an investment banking
institution of international standing appointed by the Company.
"Reference Treasury Dealer" means a primary U.S. Government
securities dealer in New York City appointed by the Company.
. "Reference Treasury Dealer Quotation" means, with respect to
the Reference Treasury Dealer and any Redemption Date, the average, as
determined by the Company, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount
and quoted in writing to the Company by such Reference Treasury Dealer at 5:00
p.m. on the third Business Day in New York City preceding such Redemption Date).
Notice of redemption pursuant to this paragraph 2 shall be
given as provided for in the Indenture not less than 30 days nor more than 60
days prior to the Redemption Date.
If fewer than all the Securities of this series are to be
redeemed, selection of Securities of this series for redemption will be made by
the Trustee in any manner the Trustee deems fair and appropriate.
The Trustee may conclusively rely on an Officers' Certificate
setting forth the calculation of the Redemption Price, which Officers'
Certificate shall be delivered to the Trustee prior to the Redemption Date.
Unless the Company defaults in payment of the Redemption Price,
from and after the Redemption Date, the Securities of this series or portions
thereof called for redemption will cease to bear interest, and the Holders
thereof will have no right in respect of such Securities of this series except
the right to receive the Redemption Price thereof.
In the event of redemption of this Security in part only, the
Trustee will reduce the Principal Amount hereof by endorsement on Schedule A
hereto such that the Principal Amount shown on Schedule A after such endorsement
will reflect only the unredeemed portion hereof.
3. MANDATORY REDEMPTION
In the event that (i) the MidAmerican Merger is not
consummated on or prior to September 7, 1999 or (ii) CalEnergy elects to abandon
the MidAmerican Merger, or the MidAmerican Merger Agreement is terminated, in
either case, on or prior to September 7, 1999, for any reason, the Company shall
redeem all the Securities on the Mandatory Redemption Date, in cash at a
redemption price (the "Mandatory Redemption Price") equal to the aggregate
principal amount thereof plus accrued and unpaid interest thereon to the earlier
of (a) September 27, 1999, in the event that the MidAmerican Merger is not
consummated on or prior to September 7, 1999 or (b) the 20th day (or if such day
is not a Business Day, the first Business Day thereafter) following the
occurrence of an event described in (ii) above (such earlier date being referred
to herein as the "Mandatory Redemption Date").
Notice of Redemption pursuant to this paragraph 3 shall be
given as provided for in the Indenture promptly after the occurrence of the
event triggering such mandatory redemption.
Unless the Company defaults in payment of the Mandatory
Redemption Price, from and after the Mandatory Redemption Date, the Securities
of this series will cease to bear interest, and the Holders thereof will have no
right in respect of such Securities of this series except the right to receive
the Mandatory Redemption Price thereof.
4. DEFEASANCE
The Indenture contains provisions for defeasance of (a) the
entire indebtedness of this Security and (b) certain restrictive covenants upon
compliance by the Company with certain conditions set forth therein.
5. DEFAULTS AND REMEDIES
If an Event of Default with respect to Securities of this
series shall occur and be continuing, the principal of the Securities of this
series may be declared due and payable in the manner and with the effect
provided in the Indenture. At any time after such declaration of acceleration
with respect to Securities of this series has been made, but before a judgment
or decree for payment of money has been obtained by the Trustee as provided in
the Indenture, if all Events of Default with respect to Securities of this
series have been cured or waived (other than the non-payment of principal of the
Securities of this series which has become due solely by reason of such
declaration of acceleration) then and in every such case, the Holders of a
majority in aggregate principal amount of the Outstanding securities under the
Indenture may, by written notice to the Company and to the Trustee, rescind and
annul such declaration and its consequences on behalf of all of the Holders, but
no such recision or annulment shall extend to or affect any subsequent default
or impair any right consequent thereon.
As provided in and subject to the provisions of the Indenture,
the Holder of this Security shall not have the right to institute any
proceeding, judicial or otherwise, with respect to
the Indenture, or for the appointment of a receiver, or trustee or for any other
remedy thereunder, unless (a) such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
securities, (b) the Holders of not less than 33% or a majority, as applicable,
in principal amount of the Securities at the time Outstanding under the
Indenture shall have made written request to the Trustee to institute
proceedings in respect of such Event of Default as Trustee, (c) such Holder
shall have offered the Trustee indemnity satisfactory to the Trustee against the
costs, expenses and liabilities to be incurred in compliance with such request,
(d) the Trustee shall not have received from the Holders of a majority in
principal amount of Securities at the time Outstanding under the Indenture a
direction inconsistent with such request and (e) the Trustee for 90 days after
its receipt of such notice from the Holder, request and offer of indemnity shall
have failed to institute any such proceeding. The foregoing shall not apply to
certain suits described in the Indenture, including any suit instituted by the
Holder of this Security for the enforcement of any payment of principal hereof
or any premium or interest hereon on or after the respective due dates expressed
herein.
6. AMENDMENT AND WAIVER
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the Indenture or any
supplemental indenture or the rights and obligations of the Company and rights
of the Holders of the Securities of any series at any time by the Company and
the Trustee with the consent of the Holders of a majority in aggregate principal
amount of the Securities at the time Outstanding of each series to be affected.
The Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor on in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of (and
premium, if any) and interest, if any, on this Security at the times, place and
rate, and in the coin or currency, herein prescribed.
7. TRANSFER AND EXCHANGE; DENOMINATIONS
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of a Security of the series of which this
Security is a part is registrable in the Security Register, upon surrender of
this Security for registration of transfer at the office or agency of the
Company in the Borough of Manhattan, The City of New York, (which initially
shall be the corporate trust office of the Trustee), duly endorsed by, or
accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar duly
executed by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities, of authorized denominations and for the
same aggregate principal amount, shall be issued to the designated transferee or
transferees.
The Securities of this series are issuable only in registered
form, without coupons, in denominations of $1,000 and any integral multiple
thereof. As provided in the Indenture and subject to certain limitations therein
set forth, Securities of this series are exchangeable for a like aggregate
principal amount of Securities of this series and of like tenor of a different
authorized denomination as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
8. SUCCESSOR OBLIGORS
When a successor assumes all the obligations of its predecessor
under the Securities of this series and the Indenture in accordance with the
terms of the Indenture, the predecessor will be released from those obligations.
9. TRUSTEE DEALINGS WITH THE COMPANY
The Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Securities of this series and
may otherwise deal with the Company, its Subsidiaries or their respective
Affiliates as if it were not the Trustee.
10. NO RECOURSE AGAINST OTHERS
No stockholder, director, officer, employee, incorporator or
Affiliate of the Company shall have any liability for any obligation of the
Company under the Securities of this series or the Indenture or for any claim
based on, in respect of or by reason of, such obligations or their creation.
Each Holder of the Securities of this series by accepting a Security of this
series waives and releases all such liability. The waiver and release are part
of the consideration for the issuance of the Securities of this series.
11. AUTHENTICATION
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
12. ISIN NUMBER AND COMMON CODE
This Security will bear an ISIN number and a Common Code. No
representation is made as to the accuracy of such numbers as printed on the
Securities of this series and reliance may be placed only on the other
identification numbers printed hereon.
13. GOVERNING LAW
This Security shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to the principles
of conflict of laws thereof.
14. DEFINED TERMS
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
SCHEDULE A
SCHEDULE OF ADJUSTMENTS
Initial Principal Amount: U.S. $
Notation made
Principal on behalf of
Date Principal Principal Amount the Security
adjustment amount amount following Exchange
made increase decrease adjustment Agent/Registrar
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EXHIBIT B.3
FORM OF FACE OF RESTRICTED DEFINITIVE SENIOR SECURED NOTE DUE 2009
THIS SECURITY HAS BEEN INITIALLY RESOLD TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" (AS DESCRIBED BY RULE 501(a)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT) AND SHALL BEAR THE FOLLOWING LEGEND UNTIL REMOVABLE IN
ACCORDANCE WITH ITS TERMS AND THE TERMS OF THE INDENTURE. THIS SECURITY (OR ITS
PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, THIS SECURITY MAY NOT BE OFFERED OR SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM.
BY ITS ACQUISITION HEREOF, EACH OF THE HOLDER OF THIS SECURITY
AND ANY OWNERS OF INTERESTS HEREIN, FOR THE BENEFIT OF THE COMPANY, (1)
REPRESENTS THAT IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" DESCRIBED BY RULE
501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT, (2) AGREES THAT BEGINNING
FROM THE LATER OF (X) THE ORIGINAL ISSUE DATE OF THIS SECURITY OR (Y) THE LAST
DATE ON WHICH THE COMPANY OR ANY AFFILIATE THEREOF WAS THE BENEFICIAL OWNER OF
THIS SECURITY (OR ANY PREDECESSOR HEREOF) THROUGH THE TIME PERIOD REFERRED TO IN
RULE 144(K) UNDER THE SECURITIES ACT, IT WILL NOT RESELL OR OTHERWISE TRANSFER
THIS SECURITY EXCEPT (A) TO THE COMPANY OR ANY AFFILIATE THEREOF, (B) IN THE
UNITED STATES TO A PERSON WHOM THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (C) OUTSIDE THE UNITED STATES
IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT,
(D) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED
BY RULE 144 THEREUNDER (IF AVAILABLE) OR (E) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (A) TO (E) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES
AND (3) AGREES THAT IT WILL, AND EACH SUBSEQUENT HOLDER WILL BE REQUIRED TO,
DELIVER TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND ON THESE RESALE RESTRICTIONS.
UNLESS THE COMPANY DETERMINES OTHERWISE IN ACCORDANCE WITH
APPLICABLE LAW, THIS LEGEND WILL BE REMOVED BY THE COMPANY UPON REQUEST OF THE
HOLDER, AFTER THE EXPIRATION OF THE TIME PERIOD
REFERRED TO IN RULE 144(K) UNDER THE SECURITIES ACT BEGINNING FROM THE LATER OF
(A) THE ORIGINAL ISSUE DATE OF THIS SECURITY AND (B) THE LAST DATE ON WHICH THE
COMPANY OR ANY AFFILIATE THEREOF WAS THE BENEFICIAL OWNER OF THIS SECURITY (OR
ANY PREDECESSOR HEREOF).
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO
THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH
TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH
THE FOREGOING RESTRICTIONS.
MIDAMERICAN FUNDING, LLC
6.339% Senior Secured Notes due 2009
No. ____ $____________
CUSIP No. 59562H AE 8
MIDAMERICAN FUNDING, LLC., a limited liability company
organized under the laws of Iowa (herein called the "Company," which term
includes any successor corporation or limited liability company under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to ______, or registered assigns, the principal amount of [ ] Million Dollars
(the "Principal Amount") on March 1, 2009, and to pay interest thereon from
March 11, 1999, or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, semi-annually on March 1 and September 1 in
each year, commencing September 1, 1999 at the rate of 6.339% per annum, until
the Principal Amount hereof is paid or made available for payment; provided that
any Principal Amount and premium, and any such installment of interest, which is
overdue shall continue to bear interest at the aforesaid rate of 6.339% per
annum (to the extent that the payment of such interest shall be legally
enforceable) from the dates such amounts are due until they are paid or made
available for payment. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in such Indenture,
be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest, which shall be the February 15 or August 15 (whether or not a
Business Day), as the case may be, immediately preceding such Interest Payment
Date. Any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Person in whose name this Security (or one
or more Predecessor Securities) is registered on such Regular Record Date and
may be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in said Indenture. If an Illiquidity Event (as defined in the Registration
Rights Agreement) occurs, interest will accrue on this Security at a rate of
6.839%per annum from and including the date on which any such Illiquidity Event
shall occur, until but excluding the date on which all Illiquidity Events shall
cease to exist or shall otherwise have been cured, provided, however, that if
such Illiquidity Event has not ceased to exist or is not otherwise cured within
two years after the consummation of the MidAmerican Merger (as defined in the
Indenture), such increase in interest rate will become permanent.
Payment of the principal of (and premium, if any) and interest
on this Security shall be made at the office or agency of the Company maintained
for that purpose in the Borough
of Manhattan, The City of New York, or at such additional offices or agencies as
the Company from time to time may designate for such purpose, in such coin or
currency of the United States of America as at the time of payment is legal
tender for the payment of public and private debts, provided, however, that, at
the option of the Company, payment of the interest on this Security may be made
only upon presentation and surrender hereof at any such office or agency and, at
the option of the Company, payment of interest may be made by check mailed to
the address of the Person entitled thereto as such address shall appear in the
Security Register. Payment of interest, if any, in respect of this Security may
also be made, in the case of a Holder of at least U.S. $1,000,000 aggregate
principal amount of Securities, by wire transfer to a U.S. Dollar account
maintained by the Holder with a bank in the United States; provided that such
Holder elects payment by wire transfer by giving written notice to the Trustee
or Paying Agent to such effect designating such account no later than 15 days
immediately preceding the relevant due date for payment (or such other date as
the Trustee may accept in its discretion).
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS
SECURITY SET FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL
PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
MIDAMERICAN FUNDING, LLC
By: ________________________________
Name:
Title:
Attest:
By:________________
Name:
Title:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein
and referred to in the within-mentioned Indenture.
IBJ WHITEHALL BANK & TRUST COMPANY
as Trustee
Dated:______________ By: ________________________________
Authorized Signatory
FORM OF REVERSE OF RESTRICTED DEFINITIVE SENIOR SECURED NOTE DUE 2009
MIDAMERICAN FUNDING, LLC
6.339% Senior Secured Notes due 2009
1. GENERAL
This Security is one of a duly authorized issue of securities
of the Company (herein called the "Securities"), issued and to be issued in one
or more series under an Indenture, dated as of March 11, 1999 (herein called the
"Original Indenture"), between the Company and IBJ Whitehall Bank & Trust
Company as trustee (herein called the "Trustee," which term includes any
successor trustee under the Original Indenture), as supplemented by the First
Supplemental Indenture, dated as of March 11, 1999 (together with the Original
Indenture, the "Indenture") between the Company and the Trustee, to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Securities and of
the terms upon which the Securities are, and are to be, authenticated and
delivered. Terms defined in the Indenture which are not defined herein are used
with the meanings assigned to them in the Indenture. This Security is one of the
series designated on the face hereof, limited in aggregate principal amount to
$175,000,000.
2. OPTIONAL REDEMPTION
The Securities of this series will be redeemable in whole or in
part, at the option of the Company at any time, at a Redemption Price equal to
the greater of (i) 100% of the principal amount of the Securities of this series
being redeemed or (ii) the sum of the present values of the remaining scheduled
payments of principal of and interest on the Securities of this series being
redeemed discounted to the Redemption Date on a semiannual basis (assuming a
360-day year consisting of twelve 30-day months) at a discount rate equal to the
Treasury Yield plus 15 basis points, plus, for (i) or (ii) above, whichever is
applicable, accrued interest on the Securities of this series to the Redemption
Date.
"Treasury Yield" means, with respect to any Redemption Date,
the rate per annum equal to the semiannual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such Redemption Date.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the Securities of this series to be redeemed
that would be utilized, at the time of selection and in accordance with
customary financial practice, in pricing new issues of corporate debt securities
of comparable maturity to the remaining term of the Securities of this series.
"Comparable Treasury Price" means, with respect to any
Redemption Date, (i) the average of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
on the third Business Day in New York City preceding such Redemption Date, as
set forth in the daily statistical release (or any successor release) published
by the Federal Reserve Bank of New York and designated "Composite 3:30 p.m.
Quotations for U.S. Government Securities" or (ii) if such release (or any
successor release) is not published or does not contain such prices on such
Business Day, the Reference Treasury Dealer Quotation for such Redemption Date.
"Independent Investment Banker" means an investment banking
institution of international standing appointed by the Company.
"Reference Treasury Dealer" means a primary U.S. Government
securities dealer in New York City appointed by the Company.
"Reference Treasury Dealer Quotation" means, with respect to
the Reference Treasury Dealer and any Redemption Date, the average, as
determined by the Company, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount
and quoted in writing to the Company by such Reference Treasury Dealer at 5:00
p.m. on the third Business Day in New York City preceding such Redemption Date).
Notice of redemption pursuant to this paragraph 2 shall be
given as provided for in the Indenture not less than 30 days nor more than 60
days prior to the Redemption Date.
If fewer than all the Securities of this series are to be
redeemed, selection of Securities of this series for redemption will be made by
the Trustee in any manner the Trustee deems fair and appropriate.
The Trustee may conclusively rely on an Officers' Certificate
setting forth the calculation of the Redemption Price, which Officers'
Certificate shall be delivered to the Trustee prior to the Redemption Date.
Unless the Company defaults in payment of the Redemption Price,
from and after the Redemption Date, the Securities of this series or portions
thereof called for redemption will cease to bear interest, and the Holders
thereof will have no right in respect of such Securities of this series except
the right to receive the Redemption Price thereof.
3. MANDATORY REDEMPTION
In the event that (i) the MidAmerican Merger is not consummated
on or prior to September 7, 1999 or (ii) CalEnergy elects to abandon the
MidAmerican Merger, or the MidAmerican Merger Agreement is terminated, in either
case, on or prior to September 7, 1999, for any reason, the Company shall redeem
all the Securities on the Mandatory Redemption Date, in
cash at a redemption price (the "Mandatory Redemption Price") equal to the
aggregate principal amount thereof plus accrued and unpaid interest thereon to
the earlier of (a) September 27, 1999, in the event that the MidAmerican Merger
is not consummated on or prior to September 7, 1999 or (b) the 20th day (or if
such day is not a Business Day, the first Business Day thereafter) following the
occurrence of an event described in (ii) above (such earlier date being referred
to herein as the "Mandatory Redemption Date").
Notice of Redemption pursuant to this paragraph 3 shall be
given as provided for in the Indenture promptly after the occurrence of the
event triggering such mandatory redemption.
Unless the Company defaults in payment of the Mandatory
Redemption Price, from and after the Mandatory Redemption Date, the Securities
of this series will cease to bear interest, and the Holders thereof will have no
right in respect of such Securities of this series except the right to receive
the Mandatory Redemption Price thereof.
4. DEFEASANCE
The Indenture contains provisions for defeasance of (a) the
entire indebtedness of this Security and (b) certain restrictive covenants upon
compliance by the Company with certain conditions set forth therein.
5. DEFAULTS AND REMEDIES
If an Event of Default with respect to Securities of this
series shall occur and be continuing, the principal of the Securities of this
series may be declared due and payable in the manner and with the effect
provided in the Indenture. At any time after such declaration of acceleration
with respect to Securities of this series has been made, but before a judgment
or decree for payment of money has been obtained by the Trustee as provided in
the Indenture, if all Events of Default with respect to Securities of this
series have been cured or waived (other than the non-payment of principal of the
Securities of this series which has become due solely by reason of such
declaration of acceleration) then and in every such case, the Holders of a
majority in aggregate principal amount of the Outstanding securities under the
Indenture may, by written notice to the Company and to the Trustee, rescind and
annul such declaration and its consequences on behalf of all of the Holders, but
no such recision or annulment shall extend to or affect any subsequent default
or impair any right consequent thereon.
As provided in and subject to the provisions of the Indenture,
the Holder of this Security shall not have the right to institute any
proceeding, judicial or otherwise, with respect to the Indenture, or for the
appointment of a receiver, or trustee or for any other remedy thereunder, unless
(a) such Holder shall have previously given the Trustee written notice of a
continuing Event of Default with respect to the Securities, (b) the Holders of
not less than 33% or a majority, as applicable, in principal amount of the
Securities at the time Outstanding under the Inden-
ture shall have made written request to the Trustee to institute proceedings in
respect of such Event of Default as Trustee, (c) such Holder shall have offered
the Trustee indemnity satisfactory to the Trustee against the costs, expenses
and liabilities to be incurred in compliance with such request, (d) the Trustee
shall not have received from the Holders of a majority in principal amount of
Securities at the time Outstanding under the Indenture a direction inconsistent
with such request and (e) the Trustee for 90 days after its receipt of such
notice from the Holder, request and offer of indemnity shall have failed to
institute any such proceeding. The foregoing shall not apply to certain suits
described in the Indenture, including any suit instituted by the Holder of this
Security for the enforcement of any payment of principal hereof or any premium
or interest hereon on or after the respective due dates expressed herein.
6. AMENDMENT AND WAIVER
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the Indenture or any
supplemental indenture or the rights and obligations of the Company and rights
of the Holders of the Securities of any series at any time by the Company and
the Trustee with the consent of the Holders of a majority in aggregate principal
amount of the Securities at the time Outstanding of each series to be affected.
The Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor on in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of (and
premium, if any) and interest, if any, on this Security at the times, place and
rate, and in the coin or currency, herein prescribed.
7. TRANSFER AND EXCHANGE; DENOMINATIONS
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in the Borough of Manhattan, The City of New
York, (which initially shall be the corporate trust office of the Trustee), duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Securities, of authorized denominations and for the same aggregate
principal amount, shall be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered
form, without coupons, in denominations of $1,000 and any integral multiple of
$1,000 in excess thereof. As provided in the Indenture and subject to certain
limitations therein set forth, Securities of this series are exchangeable for a
like aggregate principal amount of Securities of this series and of like tenor
of a different authorized denomination as requested by the Holder surrendering
the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
8. SUCCESSOR OBLIGORS
When a successor assumes all the obligations of its predecessor
under the Securities of this series and the Indenture in accordance with the
terms of the Indenture, the predecessor will be released from those obligations.
9. TRUSTEE DEALINGS WITH THE COMPANY
The Trustee under the Indenture, in its individual or any other
capacity, may become the owner or pledgee of Securities of this series and may
otherwise deal with the Company, its Subsidiaries or their respective Affiliates
as if it were not the Trustee.
10. NO RECOURSE AGAINST OTHERS
No stockholder, director, officer, employee, incorporator or
Affiliate of the Company shall have any liability for any obligation of the
Company under the Securities of this series or the Indenture or for any claim
based on, in respect of or by reason of, such obligations or their creation.
Each Holder of the Securities of this series by accepting a Security of this
series waives and releases all such liability. The waiver and release are part
of the consideration for the issuance of the Securities of this series.
11. AUTHENTICATION
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
12. CUSIP NUMBERS
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company will cause CUSIP numbers
to be printed on the Securities of this series as a convenience to the Holders
of the Securities of this series.
13. GOVERNING LAW
This Security shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to the principles
of conflict of laws thereof.
14. DEFINED TERMS
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
EXHIBIT C.1
FORM OF FACE OF RULE 144A GLOBAL SENIOR SECURED BOND DUE 2029
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS HELD BY THE DEPOSITORY TRUST COMPANY
(THE "DEPOSITARY") OR A NOMINEE OF THE DEPOSITARY. THIS SECURITY IS EXCHANGEABLE
FOR SECURITIES HELD BY A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITARY TO
A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY
OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO
A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY) MAY BE MADE
EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS GLOBAL SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITARY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY DEFINITIVE SECURITY IS ISSUED IN THE NAME
OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITARY (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER
ENTITY AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL IN AS MUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
THIS SECURITY (OR ITS PREDECESSOR) HAS BEEN INITIALLY RESOLD
IN RELIANCE ON RULE 144A UNDER THE SECURITIES ACT AND SHALL BEAR THE FOLLOWING
LEGEND UNTIL REMOVABLE IN ACCORDANCE WITH ITS TERMS AND THE TERMS OF THE
INDENTURE. THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, THIS SECURITY MAY NOT
BE OFFERED OR SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION
OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY
NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A AND
REGULATION S THEREUNDER.
1
BY ITS ACQUISITION HEREOF, EACH OF THE HOLDER OF THIS SECURITY
AND ANY OWNERS OF INTERESTS HEREIN, FOR THE BENEFIT OF THE COMPANY, (1)
REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT), (2) AGREES THAT BEGINNING FROM THE LATER OF (X) THE
ORIGINAL ISSUE DATE OF THIS SECURITY OR (Y) THE LAST DATE ON WHICH THE COMPANY
OR ANY AFFILIATE THEREOF WAS THE BENEFICIAL OWNER OF THIS SECURITY (OR ANY
PREDECESSOR HEREOF) THROUGH THE TIME PERIOD REFERRED TO IN RULE 144(K) UNDER THE
SECURITIES ACT, IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT
(A) TO THE COMPANY OR ANY AFFILIATE THEREOF, (B) IN THE UNITED STATES TO A
PERSON WHOM THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (C) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (D) PURSUANT
TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, IN EACH OF CASES (A) TO (E) IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND (3) AGREES THAT
IT WILL, AND EACH SUBSEQUENT HOLDER WILL BE REQUIRED TO, DELIVER TO EACH PERSON
TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND ON THESE RESALE RESTRICTIONS.
UNLESS THE COMPANY DETERMINES OTHERWISE IN ACCORDANCE WITH
APPLICABLE LAW, THIS LEGEND WILL BE REMOVED BY THE COMPANY UPON REQUEST OF THE
HOLDER, AFTER THE EXPIRATION OF THE TIME PERIOD REFERRED TO IN RULE 144(K) UNDER
THE SECURITIES ACT BEGINNING FROM THE LATER OF (A) THE ORIGINAL ISSUE DATE OF
THIS SECURITY AND (B) THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE
THEREOF WAS THE BENEFICIAL OWNER OF THIS SECURITY (OR ANY PREDECESSOR HEREOF).
2
MIDAMERICAN FUNDING, LLC
6.927% Senior Secured Bonds due 2029
$_______________
No.____ CUSIP No. 59562H AC 2
MIDAMERICAN FUNDING, LLC, a limited liability company
organized under the laws of Iowa (herein called the "Company," which term
includes any successor corporation or limited liability company under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to CEDE & Co., or registered assigns, the principal amount of [ ] Million
Dollars (such principal amount, as it may from time to time be adjusted by
endorsement on Schedule A hereto, is hereinafter referred to as the "Principal
Amount") on March 1, 2029, and to pay interest thereon from March 11, 1999, or
from the most recent Interest Payment Date to which interest has been paid or
duly provided for, semi-annually on March 1 and September 1 in each year,
commencing September 1, 1999 at the rate of 6.927% per annum, until the
Principal Amount hereof is paid or made available for payment; provided that any
Principal Amount and premium, and any such installment of interest, which is
overdue shall continue to bear interest at the aforesaid rate of 6.927% per
annum (to the extent that the payment of such interest shall be legally
enforceable) from the dates such amounts are due until they are paid or made
available for payment. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in such Indenture,
be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest, which shall be the February 15 or August 15 (whether or not a
Business Day), as the case may be, immediately preceding such Interest Payment
Date. Any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Person in whose name this Security (or one
or more Predecessor Securities) is registered on such Regular Record Date and
may be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in said Indenture. If an Illiquidity Event (as defined in the Registration
Rights Agreement) occurs, interest will accrue on this Security at a rate of
7.427%per annum from and including the date on which any such Illiquidity Event
shall occur, until but excluding the date on which all Illiquidity Events shall
cease to exist or shall otherwise have been cured; provided, however, that if
such Illiquidity Event has not ceased to exist or is not otherwise cured within
two years after the consummation of the MidAmerican Merger (as defined in the
Indenture), such increase in interest rate will become permanent.
3
Payment of the principal of (and premium, if any) and interest
on this Security shall be made at the office or agency of the Company maintained
for that purpose in the Borough of Manhattan, The City of New York, or at such
additional offices or agencies as the Company from time to time may designate
for such purpose, in such coin or currency of the United States of America as at
the time of payment is legal tender for the payment of public and private debts,
provided, however, that, at the option of the Company, payment of the interest
on this Security may be made only upon presentation and surrender hereof at any
such office or agency and, at the option of the Company, payment of interest may
be made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register. Payment of interest, if any, in
respect of this Security may also be made, in the case of a Holder of at least
U.S. $1,000,000 aggregate principal amount of Securities, by wire transfer to a
U.S. Dollar account maintained by the Holder with a bank in the United States;
provided that such Holder elects payment by wire transfer by giving written
notice to the Trustee or Paying Agent to such effect designating such account no
later than 15 days immediately preceding the relevant due date for payment (or
such other date as the Trustee may accept in its discretion).
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS
SECURITY SET FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL
PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
4
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
MIDAMERICAN FUNDING, LLC
By: ________________________________
Name:
Title:
Attest:
By: __________________________
Name:
Title:
5
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein
and referred to in the within-mentioned Indenture.
IBJ WHITEHALL BANK & TRUST COMPANY
as Trustee
Dated:______________ By: ________________________________
Authorized Signatory
6
FORM OF REVERSE OF RULE 144A GLOBAL SENIOR SECURED BOND DUE 2029
MIDAMERICAN FUNDING, LLC
6.927% Senior Secured Bonds due 2029
1. GENERAL
This Security is one of a duly authorized issue of Securities
of the Company (herein called the "Securities"), issued and to be issued in one
or more series under an Indenture, dated as of March 11, 1999 (herein called the
"Original Indenture"), between the Company and IBJ Whitehall Bank & Trust
Company, as trustee (herein called the "Trustee," which term includes any
successor trustee under the Original Indenture), as supplemented by the First
Supplemental Indenture, dated as of March 11, 1999 (together with the Original
Indenture, the "Indenture") between the Company and the Trustee, to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Securities and of
the terms upon which the Securities are, and are to be, authenticated and
delivered. Terms defined in the Indenture which are not defined herein are used
with the meanings assigned to them in the Indenture. This Security is one of the
series designated on the face hereof, limited in aggregate principal amount to
$325,000,000.
2. OPTIONAL REDEMPTION
The Securities of this series will be redeemable in whole or in
part, at the option of the Company at any time, at a Redemption Price equal to
the greater of (i) 100% of the principal amount of the Securities of this series
being redeemed or (ii) the sum of the present values of the remaining scheduled
payments of principal of and interest on the Securities of this series being
redeemed discounted to the Redemption Date on a semiannual basis (assuming a
360-day year consisting of twelve 30-day months) at a discount rate equal to the
Treasury Yield plus 25 basis points, plus, for (i) or (ii) above, whichever is
applicable, accrued interest on the Securities of this series to the Redemption
Date.
"Treasury Yield" means, with respect to any Redemption Date,
the rate per annum equal to the semiannual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such Redemption Date.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the Securities of this series to be redeemed
that would be utilized, at the time of selection and in accordance with
customary financial practice, in pricing new issues of corpo-
rate debt securities of comparable maturity to the remaining term of the
Securities of this series.
"Comparable Treasury Price" means, with respect to any
Redemption Date, (i) the average of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
on the third Business Day in New York City preceding such Redemption Date, as
set forth in the daily statistical release (or any successor release) published
by the Federal Reserve Bank of New York and designated "Composite 3:30 p.m.
Quotations for U.S. Government Securities" or (ii) if such release (or any
successor release) is not published or does not contain such prices on such
Business Day, the Reference Treasury Dealer Quotation for such Redemption Date.
"Independent Investment Banker" means an investment banking
institution of international standing appointed by the Company.
"Reference Treasury Dealer" means a primary U.S. Government
securities dealer in New York City appointed by the Company.
"Reference Treasury Dealer Quotation" means, with respect to
the Reference Treasury Dealer and any Redemption Date, the average, as
determined by the Company, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount
and quoted in writing to the Company by such Reference Treasury Dealer at 5:00
p.m. on the third Business Day in New York City preceding such Redemption Date).
Notice of redemption pursuant to this paragraph 2 shall be
given as provided for in the Indenture not less than 30 days nor more than 60
days prior to the Redemption Date.
If fewer than all the Securities of this series are to be
redeemed, selection of Securities of this series for redemption will be made by
the Trustee in any manner the Trustee deems fair and appropriate.
The Trustee may conclusively rely on an Officers' Certificate
setting forth the calculation of the Redemption Price, which Officers'
Certificate shall be delivered to the Trustee prior to the Redemption Date.
Unless the Company defaults in payment of the Redemption Price,
from and after the Redemption Date, the Securities of this series or portions
thereof called for redemption will cease to bear interest, and the Holders
thereof will have no right in respect of such Securities of this series except
the right to receive the Redemption Price thereof.
In the event of redemption of this Security in part only, the
Trustee will reduce the Principal Amount hereof by endorsement on Schedule A
hereto such that the Princi-
pal Amount shown on Schedule A after such endorsement will reflect only the
unredeemed portion hereof.
3. MANDATORY REDEMPTION
In the event that (i) the MidAmerican Merger is not
consummated on or prior to September 7, 1999 or (ii) CalEnergy elects to abandon
the MidAmerican Merger, or the MidAmerican Merger Agreement is terminated, in
either case, on or prior to September 7, 1999, for any reason, the Company shall
redeem all the Securities on the Mandatory Redemption Date, in cash at a
redemption price (the "Mandatory Redemption Price") equal to the aggregate
principal amount thereof plus accrued and unpaid interest thereon to the earlier
of (a) September 27, 1999, in the event that the MidAmerican Merger is not
consummated on or prior to September 7, 1999 or (b) the 20th day (or if such day
is not a Business Day, the first Business Day thereafter) following the
occurrence of an event described in (ii) above (such earlier date being referred
to herein as the "Mandatory Redemption Date").
Notice of Redemption pursuant to this paragraph 3 shall be
given as provided for in the Indenture promptly after the occurrence of the
event triggering such mandatory redemption.
Unless the Company defaults in payment of the Mandatory
Redemption Price, from and after the Mandatory Redemption Date, the Securities
of this series will cease to bear interest, and the Holders thereof will have no
right in respect of such Securities of this series except the right to receive
the Mandatory Redemption Price thereof.
4. DEFEASANCE
The Indenture contains provisions for defeasance of (a) the
entire indebtedness of this Security and (b) certain restrictive covenants upon
compliance by the Company with certain conditions set forth therein.
5. DEFAULTS AND REMEDIES
If an Event of Default with respect to Securities of this
series shall occur and be continuing, the principal of the Securities of this
series may be declared due and payable in the manner and with the effect
provided in the Indenture. At any time after such declaration of acceleration
with respect to Securities of this series has been made, but before a judgment
or decree for payment of money has been obtained by the Trustee as provided in
the Indenture, if all Events of Default with respect to Securities of this
series have been cured or waived (other than the non-payment of principal of the
Securities of this series which has become due solely by reason of such
declaration of acceleration) then and in every such case, the Holders of a
majority in aggregate principal amount of the Outstanding securities under the
Indenture may, by written notice to the Company and to the Trustee, rescind and
annul
such declaration and its consequences on behalf of all of the Holders, but no
such recision or annulment shall extend to or affect any subsequent default or
impair any right consequent thereon.
As provided in and subject to the provisions of the Indenture,
the Holder of this Security shall not have the right to institute any
proceeding, judicial or otherwise, with respect to the Indenture, or for the
appointment of a receiver, or trustee or for any other remedy thereunder, unless
(a) such Holder shall have previously given the Trustee written notice of a
continuing Event of Default with respect to the Securities, (b) the Holders of
not less than 33% or a majority, as applicable, in principal amount of the
Securities at the time Outstanding under the Indenture shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee, (c) such Holder shall have offered the Trustee indemnity
satisfactory to the Trustee against the costs, expenses and liabilities to be
incurred in compliance with such request, (d) the Trustee shall not have
received from the Holders of a majority in principal amount of Securities at the
time Outstanding under the Indenture a direction inconsistent with such request
and (e) the Trustee for 90 days after its receipt of such notice from the
Holder, request and offer of indemnity shall have failed to institute any such
proceeding. The foregoing shall not apply to certain suits described in the
Indenture, including any suit instituted by the Holder of this Security for the
enforcement of any payment of principal hereof or any premium or interest hereon
on or after the respective due dates expressed herein.
6. AMENDMENT AND WAIVER
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the Indenture or any
supplemental indenture or the rights and obligations of the Company and rights
of the Holders of the Securities of any series at any time by the Company and
the Trustee with the consent of the Holders of a majority in aggregate principal
amount of the Securities at the time Outstanding of each series to be affected.
The Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor on in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of (and
premium, if any) and interest, if any, on this Security at the times, place and
rate, and in the coin or currency, herein prescribed.
7. TRANSFER AND EXCHANGE; DENOMINATIONS
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of a Security of the series of which this
Security is a part is registrable in the Security Register, upon surrender of
this Security for registration of transfer at the office or agency of the
Company in the Borough of Manhattan, The City of New York, (which initially
shall be the corporate trust office of the Trustee), duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities,
of authorized denominations and for the same aggregate principal amount, shall
be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered
form, without coupons, in denominations of $1,000 and any integral multiple
thereof. As provided in the Indenture and subject to certain limitations therein
set forth, Securities of this series are exchangeable for a like aggregate
principal amount of Securities of this series and of like tenor of a different
authorized denomination as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
8. SUCCESSOR OBLIGORS
When a successor assumes all the obligations of its
predecessor under the Securities of this series and the Indenture in accordance
with the terms of the Indenture, the predecessor will be released from those
obligations.
9. TRUSTEE DEALINGS WITH THE COMPANY
The Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Securities of this series and
may otherwise deal with the Company, its Subsidiaries or their respective
Affiliates as if it were not the Trustee.
10. NO RECOURSE AGAINST OTHERS
No stockholder, director, officer, employee, incorporator or
Affiliate of the Company shall have any liability for any obligation of the
Company under the Securities of this series or the Indenture or for any claim
based on, in respect of or by reason of, such obligations or their creation.
Each Holder of the Securities of this series by accepting a Security of this
series waives and releases all such liability. The waiver and release are part
of the consideration for the issuance of the Securities of this series.
11. AUTHENTICATION
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
12. CUSIP NUMBERS
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company will cause CUSIP numbers
to be printed on the Securities of this series as a convenience to the Holders
of the Securities of this series.
13. GOVERNING LAW
This Security shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to the principles
of conflict of laws thereof.
14. DEFINED TERMS
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
SCHEDULE A
SCHEDULE OF ADJUSTMENTS
Initial Principal Amount: U.S. $
Notation made
Principal on behalf of
Date Principal Principal Amount the Security
adjustment amount amount following Exchange
made increase decrease adjustment Agent/Registrar
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EXHIBIT C.2
FORM OF FACE OF REGULATION S GLOBAL SENIOR SECURED BOND DUE 2029
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS HELD BY THE DEPOSITORY TRUST COMPANY
(THE "DEPOSITARY") OR A NOMINEE OF THE DEPOSITARY. THIS SECURITY IS EXCHANGEABLE
FOR SECURITIES HELD BY A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITARY TO
A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY
OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO
A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY) MAY BE MADE
EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS GLOBAL SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITARY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY DEFINITIVE SECURITY IS ISSUED IN THE NAME
OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITARY (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER
ENTITY AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL IN AS MUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
THIS SECURITY (OR ITS PREDECESSOR) HAS BEEN ISSUED IN RELIANCE
ON REGULATION S UNDER THE SECURITIES ACT AND SHALL BEAR THE FOLLOWING LEGEND
UNTIL REMOVABLE IN ACCORDANCE WITH ITS TERMS AND THE TERMS OF THE INDENTURE.
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT
FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), AND, ACCORDINGLY, THIS SECURITY MAY NOT BE OFFERED OR
SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY
NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A AND
REGULATION S THEREUNDER.
BY ITS ACQUISITION HEREOF, EACH OF THE HOLDER OF THIS SECURITY
AND ANY OWNERS OF INTERESTS HEREIN, FOR THE BENEFIT OF THE COMPANY, (1)
REPRESENTS THAT IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN
OFFSHORE TRANSACTION, (2) AGREES THAT BEGINNING FROM THE LATER OF (X) THE
ORIGINAL ISSUE DATE OF THIS SECURITY OR (Y) THE LAST DATE ON WHICH THE COMPANY
OR ANY AFFILIATE THEREOF WAS THE BENEFICIAL OWNER OF THIS SECURITY (OR ANY
PREDECESSOR HEREOF) THROUGH THE TIME PERIOD REFERRED TO IN RULE 144(K) UNDER THE
SECURITIES ACT, IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT
(A) TO THE COMPANY OR ANY AFFILIATE THEREOF, (B) IN THE UNITED STATES TO A
PERSON WHOM THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (C) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (D) PURSUANT
TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, IN EACH OF CASES (A) TO (E) IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND (3) AGREES THAT
IT WILL, AND EACH SUBSEQUENT HOLDER WILL BE REQUIRED TO, DELIVER TO EACH PERSON
TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND ON THESE RESALE RESTRICTIONS.
THE RIGHTS ATTACHED TO THIS REGULATION S TEMPORARY GLOBAL
SECURITY, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR
DEFINITIVE SECURITIES, ARE AS SPECIFIED IN THE INDENTURE.
PRIOR TO THE COMMENCEMENT OF THE REGISTERED EXCHANGE OFFER OR
THE EFFECTIVENESS OF THE SHELF REGISTRATION STATEMENT, TRANSFERS OF INTERESTS IN
THIS REGULATION S GLOBAL SECURITY TO U.S. PERSONS SHALL BE LIMITED TO TRANSFERS
TO QUALIFIED INSTITUTIONAL BUYERS PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT.
UNLESS THE COMPANY DETERMINES OTHERWISE IN ACCORDANCE WITH
APPLICABLE LAW, THIS LEGEND WILL BE REMOVED BY THE COMPANY FOLLOWING THE
EXPIRATION OF 40 CONSECUTIVE DAYS BEGINNING ON AND INCLUDING THE LATER OF (A)
THE DAY ON WHICH INTERESTS IN THIS SECURITY ARE OFFERED TO PERSONS OTHER THAN
DISTRIBUTORS (AS DEFINED IN REGULATION S) AND (B) THE ORIGINAL ISSUE DATE OF
THIS SECURITY. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES"
AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE
SECURITIES ACT.
MIDAMERICAN FUNDING, LLC
6.927% Senior Secured Bonds due 2029
No. ____ $____________
ISIN No. US59562H AJ 77
MIDAMERICAN FUNDING, LLC., a limited liability company
organized under the laws of Iowa (herein called the "Company," which term
includes any successor corporation or limited liability company under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to CEDE & Co., or registered assigns, the principal amount of [ ] Million
Dollars (such principal amount, as it may from time to time be adjusted by
endorsement on Schedule A hereto, is hereinafter referred to as the "Principal
Amount") on March 1, 2029, and to pay interest thereon from March 11, 1999, or
from the most recent Interest Payment Date to which interest has been paid or
duly provided for, semi-annually on March 1 and September 1 in each year,
commencing September 1, 1999 at the rate of 6.927% per annum, until the
Principal Amount hereof is paid or made available for payment; provided that any
Principal Amount and premium, and any such installment of interest, which is
overdue shall continue to bear interest at the aforesaid rate of 6.927% per
annum (to the extent that the payment of such interest shall be legally
enforceable) from the dates such amounts are due until they are paid or made
available for payment. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in such Indenture,
be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest, which shall be the February 15 or August 15 (whether or not a
Business Day), as the case may be, immediately preceding such Interest Payment
Date. Any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Person in whose name this Security (or one
or more Predecessor Securities) is registered on such Regular Record Date and
may be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in said Indenture. If an Illiquidity Event (as defined in the Registration
Rights Agreement) occurs, interest will accrue on this Security at a rate of
7.427%per annum from and including the date on which any such Illiquidity Event
shall occur, until but excluding the date on which all Illiquidity Events shall
cease to exist or shall otherwise have been cured; provided, however, that if
such Illiquidity Event has not ceased to exist or is not otherwise cured within
two years after the consummation of the MidAmerican Merger (as defined in the
Indenture), such increase in interest rate will become permanent.
Payment of the principal of (and premium, if any) and interest
on this Security shall be made at the office or agency of the Company maintained
for that purpose in the Borough of Manhattan, The City of New York, or at such
additional offices or agencies as the Company from time to time may designate
for such purpose, in such coin or currency of the United States of America as at
the time of payment is legal tender for the payment of public and private debts,
provided, however, that, at the option of the Company, payment of the interest
on this Security may be made only upon presentation and surrender hereof at any
such office or agency and, at the option of the Company, payment of interest may
be made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register. Payment of interest, if any, in
respect of this Security may also be made, in the case of a Holder of at least
U.S. $1,000,000 aggregate principal amount of Securities, by wire transfer to a
U.S. Dollar account maintained by the Holder with a bank in the United States;
provided that such Holder elects payment by wire transfer by giving written
notice to the Trustee or Paying Agent to such effect designating such account no
later than 15 days immediately preceding the relevant due date for payment (or
such other date as the Trustee may accept in its discretion).
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS
SECURITY SET FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL
PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
MIDAMERICAN FUNDING, LLC
By:_________________________
Name:
Title:
Attest:
By: ____________________-
Name:
Title:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein
and referred to in the within-mentioned Indenture.
IBJ WHITEHALL BANK & TRUST COMPANY
as Trustee
Dated:______________ By: ________________________________
Authorized Signatory
FORM OF REVERSE OF REGULATION S GLOBAL SENIOR SECURED BOND DUE 2029
MIDAMERICAN FUNDING, LLC
6.927% Senior Secured Bonds due 2029
1. GENERAL
This Security is one of a duly authorized issue of securities
of the Company (herein called the "Securities"), issued and to be issued in one
or more series under an Indenture, dated as of March 11, 1999 (herein called the
"Original Indenture"), between the Company and IBJ Whitehall Bank & Trust
Company as trustee (herein called the "Trustee," which term includes any
successor trustee under the Original Indenture), as supplemented by the First
Supplemental Indenture, dated as of March 11, 1999 (together with the Original
Indenture, the "Indenture") between the Company and the Trustee, to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Securities and of
the terms upon which the Securities are, and are to be, authenticated and
delivered. Terms defined in the Indenture which are not defined herein are used
with the meanings assigned to them in the Indenture. This Security is one of the
series designated on the face hereof, limited in aggregate principal amount to
$325,000,000.
2. OPTIONAL REDEMPTION
The Securities of this series will be redeemable in whole or in
part, at the option of the Company at any time, at a Redemption Price equal to
the greater of (i) 100% of the principal amount of the Securities of this series
being redeemed or (ii) the sum of the present values of the remaining scheduled
payments of principal of and interest on the Securities of this series being
redeemed discounted to the Redemption Date on a semiannual basis (assuming a
360-day year consisting of twelve 30-day months) at a discount rate equal to the
Treasury Yield plus 25 basis points, plus, for (i) or (ii) above, whichever is
applicable, accrued interest on the Securities of this series to the Redemption
Date.
"Treasury Yield" means, with respect to any Redemption Date,
the rate per annum equal to the semiannual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such Redemption Date.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the Securities of this series to be redeemed
that would be utilized, at the time of selection and in accordance with
customary financial practice, in pricing new issues of corporate debt securities
of comparable maturity to the remaining term of the Securities of this series.
"Comparable Treasury Price" means, with respect to any
Redemption Date, (i) the average of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
on the third Business Day in New York City preceding such Redemption Date, as
set forth in the daily statistical release (or any successor release) published
by the Federal Reserve Bank of New York and designated "Composite 3:30 p.m.
Quotations for U.S. Government Securities" or (ii) if such release (or any
successor release) is not published or does not contain such prices on such
Business Day, the Reference Treasury Dealer Quotation for such Redemption Date.
"Independent Investment Banker" means an investment banking
institution of international standing appointed by the Company.
"Reference Treasury Dealer" means a primary U.S. Government
securities dealer in New York City appointed by the Company.
"Reference Treasury Dealer Quotation" means, with respect to
the Reference Treasury Dealer and any Redemption Date, the average, as
determined by the Company, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount
and quoted in writing to the Company by such Reference Treasury Dealer at 5:00
p.m. on the third Business Day in New York City preceding such Redemption Date).
Notice of redemption pursuant to this paragraph 2 shall be
given as provided for in the Indenture not less than 30 days nor more than 60
days prior to the Redemption Date.
If fewer than all the Securities of this series are to be
redeemed, selection of Securities of this series for redemption will be made by
the Trustee in any manner the Trustee deems fair and appropriate.
The Trustee may conclusively rely on an Officers' Certificate
setting forth the calculation of the Redemption Price, which Officers'
Certificate shall be delivered to the Trustee prior to the Redemption Date.
Unless the Company defaults in payment of the Redemption Price,
from and after the Redemption Date, the Securities of this series or portions
thereof called for redemption will cease to bear interest,
and the Holders thereof will have no right in respect of such Securities of this
series except the right to receive the Redemption Price thereof.
In the event of redemption of this Security in part only, the
Trustee will reduce the Principal Amount hereof by endorsement on Schedule A
hereto such that the Principal Amount shown on Schedule A after such endorsement
will reflect only the unredeemed portion hereof.
3. MANDATORY REDEMPTION
In the event that (i) the MidAmerican Merger is not
consummated on or prior to September 7, 1999 or (ii) CalEnergy elects to abandon
the MidAmerican Merger, or the MidAmerican Merger Agreement is terminated, in
either case, on or prior to September 7, 1999, for any reason, the Company shall
redeem all the Securities on the Mandatory Redemption Date, in cash at a
redemption price (the "Mandatory Redemption Price") equal to the aggregate
principal amount thereof plus accrued and unpaid interest thereon to the earlier
of (a) September 27, 1999, in the event that the MidAmerican Merger is not
consummated on or prior to September 7, 1999 or (b) the 20th day (or if such day
is not a Business Day, the first Business Day thereafter) following the
occurrence of an event described in (ii) above (such earlier date being referred
to herein as the "Mandatory Redemption Date").
Notice of Redemption pursuant to this paragraph 3 shall be
given as provided for in the Indenture promptly after the occurrence of the
event triggering such mandatory redemption.
Unless the Company defaults in payment of the Mandatory
Redemption Price, from and after the Mandatory Redemption Date, the Securities
of this series will cease to bear interest, and the Holders thereof will have no
right in respect of such Securities of this series except the right to receive
the Mandatory Redemption Price thereof.
4. DEFEASANCE
The Indenture contains provisions for defeasance of (a) the
entire indebtedness of this Security and (b) certain restrictive covenants upon
compliance by the Company with certain conditions set forth therein.
5. DEFAULTS AND REMEDIES
If an Event of Default with respect to Securities of this
series shall occur and be continuing, the principal of the Securities of this
series may be declared due and payable in the manner and with the effect
provided in the Indenture. At any time after such declaration of acceleration
with respect to Securities of this series has been made, but before a judgment
or decree for payment of money has been obtained by the Trustee as provided in
the Indenture, if all Events of Default with respect to Securities of this
series have been cured or waived (other than the non-payment of principal of the
Securities of this series which has become due solely by reason of such
declaration of acceleration) then and in every such case, the Holders of a
majority in aggregate principal amount of the Outstanding securities under the
Indenture may, by written notice to the Company and to the Trustee, rescind and
annul such declaration and its consequences on behalf of all of the Holders, but
no such recision or annulment shall extend to or affect any subsequent default
or impair any right consequent thereon.
As provided in and subject to the provisions of the Indenture,
the Holder of this Security shall not have the right to institute any
proceeding, judicial or otherwise, with respect to
the Indenture, or for the appointment of a receiver, or trustee or for any other
remedy thereunder, unless (a) such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
securities, (b) the Holders of not less than 33% or a majority, as applicable,
in principal amount of the Securities at the time Outstanding under the
Indenture shall have made written request to the Trustee to institute
proceedings in respect of such Event of Default as Trustee, (c) such Holder
shall have offered the Trustee indemnity satisfactory to the Trustee against the
costs, expenses and liabilities to be incurred in compliance with such request,
(d) the Trustee shall not have received from the Holders of a majority in
principal amount of Securities at the time Outstanding under the Indenture a
direction inconsistent with such request and (e) the Trustee for 90 days after
its receipt of such notice from the Holder, request and offer of indemnity shall
have failed to institute any such proceeding. The foregoing shall not apply to
certain suits described in the Indenture, including any suit instituted by the
Holder of this Security for the enforcement of any payment of principal hereof
or any premium or interest hereon on or after the respective due dates expressed
herein.
6. AMENDMENT AND WAIVER
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the Indenture or any
supplemental indenture or the rights and obligations of the Company and rights
of the Holders of the Securities of any series at any time by the Company and
the Trustee with the consent of the Holders of a majority in aggregate principal
amount of the Securities at the time Outstanding of each series to be affected.
The Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor on in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of (and
premium, if any) and interest, if any, on this Security at the times, place and
rate, and in the coin or currency, herein prescribed.
7. TRANSFER AND EXCHANGE; DENOMINATIONS
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of a Security of the series of which this
Security is a part is registrable in the Security Register, upon surrender of
this Security for registration of transfer at the office or agency of the
Company in the Borough of Manhattan, The City of New York, (which initially
shall be the corporate trust office of the Trustee), duly endorsed by, or
accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar duly
executed by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities, of authorized denominations and for the
same aggregate principal amount, shall be issued to the designated transferee or
transferees.
The Securities of this series are issuable only in registered
form, without coupons, in denominations of $1,000 and any integral multiple
thereof. As provided in the Indenture and subject to certain limitations therein
set forth, Securities of this series are exchangeable for a like aggregate
principal amount of Securities of this series and of like tenor of a different
authorized denomination as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
8. SUCCESSOR OBLIGORS
When a successor assumes all the obligations of its predecessor
under the Securities of this series and the Indenture in accordance with the
terms of the Indenture, the predecessor will be released from those obligations.
9. TRUSTEE DEALINGS WITH THE COMPANY
The Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Securities of this series and
may otherwise deal with the Company, its Subsidiaries or their respective
Affiliates as if it were not the Trustee.
10. NO RECOURSE AGAINST OTHERS
No stockholder, director, officer, employee, incorporator or
Affiliate of the Company shall have any liability for any obligation of the
Company under the Securities of this series or the Indenture or for any claim
based on, in respect of or by reason of, such obligations or their creation.
Each Holder of the Securities of this series by accepting a Security of this
series waives and releases all such liability. The waiver and release are part
of the consideration for the issuance of the Securities of this series.
11. AUTHENTICATION
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
12. ISIN NUMBER AND COMMON CODE
This Security will bear an ISIN number and a Common Code. No
representation is made as to the accuracy of such numbers as printed on the
Securities of this series and reliance may be placed only on the other
identification numbers printed hereon.
13. GOVERNING LAW
This Security shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to the principles
of conflict of laws thereof.
14. DEFINED TERMS
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
SCHEDULE A
SCHEDULE OF ADJUSTMENTS
Initial Principal Amount: U.S. $
Notation made
Principal on behalf of
Date Principal Principal Amount the Security
adjustment amount amount following Exchange
made increase decrease adjustment Agent/Registrar
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EXHIBIT C.3
FORM OF FACE OF RESTRICTED DEFINITIVE SENIOR SECURED BOND DUE 2029
THIS SECURITY HAS BEEN INITIALLY RESOLD TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" (AS DESCRIBED BY RULE 501(a)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT) AND SHALL BEAR THE FOLLOWING LEGEND UNTIL REMOVABLE IN
ACCORDANCE WITH ITS TERMS AND THE TERMS OF THE INDENTURE. THIS SECURITY (OR ITS
PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, THIS SECURITY MAY NOT BE OFFERED OR SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM.
BY ITS ACQUISITION HEREOF, EACH OF THE HOLDER OF THIS SECURITY
AND ANY OWNERS OF INTERESTS HEREIN, FOR THE BENEFIT OF THE COMPANY, (1)
REPRESENTS THAT IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" DESCRIBED BY RULE
501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT, (2) AGREES THAT BEGINNING
FROM THE LATER OF (X) THE ORIGINAL ISSUE DATE OF THIS SECURITY OR (Y) THE LAST
DATE ON WHICH THE COMPANY OR ANY AFFILIATE THEREOF WAS THE BENEFICIAL OWNER OF
THIS SECURITY (OR ANY PREDECESSOR HEREOF) THROUGH THE TIME PERIOD REFERRED TO IN
RULE 144(K) UNDER THE SECURITIES ACT, IT WILL NOT RESELL OR OTHERWISE TRANSFER
THIS SECURITY EXCEPT (A) TO THE COMPANY OR ANY AFFILIATE THEREOF, (B) IN THE
UNITED STATES TO A PERSON WHOM THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (C) OUTSIDE THE UNITED STATES
IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT,
(D) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED
BY RULE 144 THEREUNDER (IF AVAILABLE) OR (E) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (A) TO (E) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES
AND (3) AGREES THAT IT WILL, AND EACH SUBSEQUENT HOLDER WILL BE REQUIRED TO,
DELIVER TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND ON THESE RESALE RESTRICTIONS.
UNLESS THE COMPANY DETERMINES OTHERWISE IN ACCORDANCE WITH
APPLICABLE LAW, THIS LEGEND WILL BE REMOVED BY THE COMPANY
UPON REQUEST OF THE HOLDER, AFTER THE EXPIRATION OF THE TIME PERIOD REFERRED TO
IN RULE 144(K) UNDER THE SECURITIES ACT BEGINNING FROM THE LATER OF (A) THE
ORIGINAL ISSUE DATE OF THIS SECURITY AND (B) THE LAST DATE ON WHICH THE COMPANY
OR ANY AFFILIATE THEREOF WAS THE BENEFICIAL OWNER OF THIS SECURITY (OR ANY
PREDECESSOR HEREOF).
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO
THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH
TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH
THE FOREGOING RESTRICTIONS.
MIDAMERICAN FUNDING, LLC
6.927% Senior Secured Bonds due 2029
No. ____ $____________
CUSIP No. 59562H AF 5
MIDAMERICAN FUNDING, LLC, a limited liability company
organized under the laws of Iowa (herein called the "Company," which term
includes any successor corporation or limited liability company under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to ______, or registered assigns, the principal amount of [ ] Million Dollars
(the "Principal Amount") on March 1, 2029, and to pay interest thereon from
March 11, 1999, or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, semi-annually on March 1 and September 1 in
each year, commencing September 1, 1999 at the rate of 6.927% per annum, until
the Principal Amount hereof is paid or made available for payment; provided that
any Principal Amount and premium, and any such installment of interest, which is
overdue shall continue to bear interest at the aforesaid rate of 6.927% per
annum (to the extent that the payment of such interest shall be legally
enforceable) from the dates such amounts are due until they are paid or made
available for payment. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in such Indenture,
be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest, which shall be the February 15 or August 15 (whether or not a
Business Day), as the case may be, immediately preceding such Interest Payment
Date. Any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Person in whose name this Security (or one
or more Predecessor Securities) is registered on such Regular Record Date and
may be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in said Indenture. If an Illiquidity Event (as defined in the Registration
Rights Agreement) occurs, interest will accrue on this Security at a rate of
7.427%per annum from and including the date on which any such Illiquidity Event
shall occur, until but excluding the date on which all Illiquidity Events shall
cease to exist or shall otherwise have been cured, provided, however, that if
such Illiquidity Event has not ceased to exist or is not otherwise cured within
two years after the consummation of the MidAmerican Merger (as defined in the
Indenture), such increase in interest rate will become permanent.
Payment of the principal of (and premium, if any) and interest
on this Security shall be made at the office or agency of the Company maintained
for that purpose in the Borough
of Manhattan, The City of New York, or at such additional offices or agencies as
the Company from time to time may designate for such purpose, in such coin or
currency of the United States of America as at the time of payment is legal
tender for the payment of public and private debts, provided, however, that, at
the option of the Company, payment of the interest on this Security may be made
only upon presentation and surrender hereof at any such office or agency and, at
the option of the Company, payment of interest may be made by check mailed to
the address of the Person entitled thereto as such address shall appear in the
Security Register. Payment of interest, if any, in respect of this Security may
also be made, in the case of a Holder of at least U.S. $1,000,000 aggregate
principal amount of Securities, by wire transfer to a U.S. Dollar account
maintained by the Holder with a bank in the United States; provided that such
Holder elects payment by wire transfer by giving written notice to the Trustee
or Paying Agent to such effect designating such account no later than 15 days
immediately preceding the relevant due date for payment (or such other date as
the Trustee may accept in its discretion).
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS
SECURITY SET FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL
PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
MIDAMERICAN FUNDING, LLC
By: ________________________________
Name:
Title:
Attest:
By:_______________
Name:
Title:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein
and referred to in the within-mentioned Indenture.
IBJ WHITEHALL BANK & TRUST COMPANY
as Trustee
Dated:______________ By: ________________________________
Authorized Signatory
FORM OF REVERSE OF RESTRICTED DEFINITIVE SENIOR SECURED BOND DUE 2029
MIDAMERICAN FUNDING, LLC
6.927% Senior Secured Bonds due 2029
1. GENERAL
This Security is one of a duly authorized issue of securities
of the Company (herein called the "Securities"), issued and to be issued in one
or more series under an Indenture, dated as of March 11, 1999 (herein called the
"Original Indenture"), between the Company and IBJ Whitehall Bank & Trust
Company as trustee (herein called the "Trustee," which term includes any
successor trustee under the Original Indenture), as supplemented by the First
Supplemental Indenture, dated as of March 11, 1999 (together with the Original
Indenture, the "Indenture") between the Company and the Trustee, to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Securities and of
the terms upon which the Securities are, and are to be, authenticated and
delivered. Terms defined in the Indenture which are not defined herein are used
with the meanings assigned to them in the Indenture. This Security is one of the
series designated on the face hereof, limited in aggregate principal amount to
$325,000,000.
2. OPTIONAL REDEMPTION
The Securities of this series will be redeemable in whole or in
part, at the option of the Company at any time, at a Redemption Price equal to
the greater of (i) 100% of the principal amount of the Securities of this series
being redeemed or (ii) the sum of the present values of the remaining scheduled
payments of principal of and interest on the Securities of this series being
redeemed discounted to the Redemption Date on a semiannual basis (assuming a
360-day year consisting of twelve 30-day months) at a discount rate equal to the
Treasury Yield plus 25 basis points, plus, for (i) or (ii) above, whichever is
applicable, accrued interest on the Securities of this series to the Redemption
Date.
"Treasury Yield" means, with respect to any Redemption Date,
the rate per annum equal to the semiannual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such Redemption Date.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the Securities of this series to be redeemed
that would be utilized, at the time of selection and in
accordance with customary financial practice, in pricing new issues of corporate
debt securities of comparable maturity to the remaining term of the Securities
of this series.
"Comparable Treasury Price" means, with respect to any
Redemption Date, (i) the average of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
on the third Business Day in New York City preceding such Redemption Date, as
set forth in the daily statistical release (or any successor release) published
by the Federal Reserve Bank of New York and designated "Composite 3:30 p.m.
Quotations for U.S. Government Securities" or (ii) if such release (or any
successor release) is not published or does not contain such prices on such
Business Day, the Reference Treasury Dealer Quotation for such Redemption Date.
"Independent Investment Banker" means an investment banking
institution of international standing appointed by the Company.
"Reference Treasury Dealer" means a primary U.S. Government
securities dealer in New York City appointed by the Company.
"Reference Treasury Dealer Quotation" means, with respect to
the Reference Treasury Dealer and any Redemption Date, the average, as
determined by the Company, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount
and quoted in writing to the Company by such Reference Treasury Dealer at 5:00
p.m. on the third Business Day in New York City preceding such Redemption Date).
Notice of redemption pursuant to this paragraph 2 shall be
given as provided for in the Indenture not less than 30 days nor more than 60
days prior to the Redemption Date.
If fewer than all the Securities of this series are to be
redeemed, selection of Securities of this series for redemption will be made by
the Trustee in any manner the Trustee deems fair and appropriate.
The Trustee may conclusively rely on an Officers' Certificate
setting forth the calculation of the Redemption Price, which Officers'
Certificate shall be delivered to the Trustee prior to the Redemption Date.
Unless the Company defaults in payment of the Redemption
Price, from and after the Redemption Date, the Securities of this series or
portions thereof called for redemption will cease to bear interest, and the
Holders thereof will have no right in respect of such Securities of this series
except the right to receive the Redemption Price thereof.
3. MANDATORY REDEMPTION
In the event that (i) the MidAmerican Merger is not consummated
on or prior to September 7, 1999 or (ii) CalEnergy elects to abandon the
MidAmerican Merger, or the MidAmerican Merger Agreement is terminated, in either
case, on or prior to September 7, 1999, for any reason, the Company shall redeem
all the Securities on the Mandatory Redemption Date, in cash at a redemption
price (the "Mandatory Redemption Price") equal to the aggregate principal amount
thereof plus accrued and unpaid interest thereon to the earlier of (a) September
27, 1999, in the event that the MidAmerican Merger is not consummated on or
prior to September 7, 1999 or (b) the 20th day (or if such day is not a Business
Day, the first Business Day thereafter) following the occurrence of an event
described in (ii) above (such earlier date being referred to herein as the
"Mandatory Redemption Date").
Notice of Redemption pursuant to this paragraph 3 shall be
given as provided for in the Indenture promptly after the occurrence of the
event triggering such mandatory redemption.
Unless the Company defaults in payment of the Mandatory
Redemption Price, from and after the Mandatory Redemption Date, the Securities
of this series will cease to bear interest, and the Holders thereof will have no
right in respect of such Securities of this series except the right to receive
the Mandatory Redemption Price thereof.
4. DEFEASANCE
The Indenture contains provisions for defeasance of (a) the
entire indebtedness of this Security and (b) certain restrictive covenants upon
compliance by the Company with certain conditions set forth therein.
5. DEFAULTS AND REMEDIES
If an Event of Default with respect to Securities of this
series shall occur and be continuing, the principal of the Securities of this
series may be declared due and payable in the manner and with the effect
provided in the Indenture. At any time after such declaration of acceleration
with respect to Securities of this series has been made, but before a judgment
or decree for payment of money has been obtained by the Trustee as provided in
the Indenture, if all Events of Default with respect to Securities of this
series have been cured or waived (other than the non-payment of principal of the
Securities of this series which has become due solely by reason of such
declaration of acceleration) then and in every such case, the Holders of a
majority in aggregate principal amount of the Outstanding securities under the
Indenture may, by written notice to the Company and to the Trustee, rescind and
annul such declaration and its consequences on behalf of all of the Holders, but
no such recision or annulment shall extend to or affect any subsequent default
or impair any right consequent thereon.
As provided in and subject to the provisions of the Indenture,
the Holder of this Security shall not have the right to institute any
proceeding, judicial or otherwise, with respect to
the Indenture, or for the appointment of a receiver, or trustee or for any other
remedy thereunder, unless (a) such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Securities, (b) the Holders of not less than 33% or a majority, as applicable,
in principal amount of the Securities at the time Outstanding under the
Indenture shall have made written request to the Trustee to institute
proceedings in respect of such Event of Default as Trustee, (c) such Holder
shall have offered the Trustee indemnity satisfactory to the Trustee against the
costs, expenses and liabilities to be incurred in compliance with such request,
(d) the Trustee shall not have received from the Holders of a majority in
principal amount of Securities at the time Outstanding under the Indenture a
direction inconsistent with such request and (e) the Trustee for 90 days after
its receipt of such notice from the Holder, request and offer of indemnity shall
have failed to institute any such proceeding. The foregoing shall not apply to
certain suits described in the Indenture, including any suit instituted by the
Holder of this Security for the enforcement of any payment of principal hereof
or any premium or interest hereon on or after the respective due dates expressed
herein.
6. AMENDMENT AND WAIVER
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the Indenture or any
supplemental indenture or the rights and obligations of the Company and rights
of the Holders of the Securities of any series at any time by the Company and
the Trustee with the consent of the Holders of a majority in aggregate principal
amount of the Securities at the time Outstanding of each series to be affected.
The Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor on in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of (and
premium, if any) and interest, if any, on this Security at the times, place and
rate, and in the coin or currency, herein prescribed.
7. TRANSFER AND EXCHANGE; DENOMINATIONS
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in the Borough of Manhattan, The City of New
York, (which initially shall be the corporate trust office of the Trustee), duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Com-
▇▇▇▇ and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities,
of authorized denominations and for the same aggregate principal amount, shall
be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered
form, without coupons, in denominations of $1,000 and any integral multiple of
$1,000 in excess thereof. As provided in the Indenture and subject to certain
limitations therein set forth, Securities of this series are exchangeable for a
like aggregate principal amount of Securities of this series and of like tenor
of a different authorized denomination as requested by the Holder surrendering
the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
8. SUCCESSOR OBLIGORS
When a successor assumes all the obligations of its predecessor
under the Securities of this series and the Indenture in accordance with the
terms of the Indenture, the predecessor will be released from those obligations.
9. TRUSTEE DEALINGS WITH THE COMPANY
The Trustee under the Indenture, in its individual or any other
capacity, may become the owner or pledgee of Securities of this series and may
otherwise deal with the Company, its Subsidiaries or their respective Affiliates
as if it were not the Trustee.
10. NO RECOURSE AGAINST OTHERS
No stockholder, director, officer, employee, incorporator or
Affiliate of the Company shall have any liability for any obligation of the
Company under the Securities of this series or the Indenture or for any claim
based on, in respect of or by reason of, such obligations or their creation.
Each Holder of the Securities of this series by accepting a Security of this
series waives and releases all such liability. The waiver and release are part
of the consideration for the issuance of the Securities of this series.
11. AUTHENTICATION
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
12. CUSIP NUMBERS
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company will cause CUSIP numbers
to be printed on the Securities of this series as a convenience to the Holders
of the Securities of this series.
13. GOVERNING LAW
This Security shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to the principles
of conflict of laws thereof.
14. DEFINED TERMS
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture. 88.