1081316--3/3/2006--MIDAMERICAN_ENERGY_HOLDINGS_CO

related topics

{debt, indebtedness, cash}

{operation, natural, condition}

{gas, price, oil}

{operation, international, foreign}

{investment, property, distribution}

{cost, contract, operation}

{cost, regulation, environmental}

{financial, litigation, operation}

{loan, real, estate}

{customer, product, revenue}

{acquisition, growth, future}

MEHC is a holding company that depends on distributions from its subsidiaries and joint ventures to meet its needs. The Company is substantially leveraged, the terms of MEHC s senior and subordinated debt do not restrict its ability or its subsidiaries ability to incur additional indebtedness that could have an adverse impact on the Company s financial condition and MEHC s senior and subordinated debt is structurally subordinated to the indebtedness of its subsidiaries. MEHC s majority stockholder, Berkshire Hathaway, could exercise control over the Company in a manner that would benefit Berkshire Hathaway to the detriment of the Company s creditors. The Company s growth has been achieved, in significant part, through strategic acquisitions, and additional acquisitions may not be successful. The Company is actively pursuing, developing and constructing new or expanded facilities, the completion and expected cost of which is subject to significant risk. MEHC s subsidiaries are subject to certain operating uncertainties which may adversely affect the Company s financial position, results of operation and ability to service MEHC s senior and subordinated debt. Acts of sabotage and terrorism aimed at the Company s facilities, the facilities of the Company s fuel suppliers or customers, or at regional transmission facilities could adversely affect the Company s business. The Company is subject to energy regulation, legislation and political risks and changes in regulations and rates or legislative developments may adversely affect the Company s business, financial condition, results of operations and ability to service MEHC s senior and subordinated debt. The Company is subject to environmental, health, safety and other laws and regulations which may adversely impact the Company. One of MEHC s indirect wholly owned subsidiaries, MidAmerican Energy, is subject to the unique risks associated with nuclear generation. Increased competition resulting from legislative, regulatory and restructuring efforts could have a significant financial impact on the Company and its utility subsidiaries and consequently decrease the Company s revenue. A significant decrease in demand for natural gas in the markets served by the Company s subsidiaries pipeline and distribution systems would significantly decrease the Company s revenue and thereby adversely affect the Company s business, financial condition, results of operations and ability to service its obligations. Cyclical fluctuations in the residential real estate brokerage and mortgage businesses could adversely affect HomeServices. Failure of the Company s significant power purchasers, pipeline customers and British retail suppliers to pay amounts due under their contracts or other commitments could reduce the Company s revenues materially. The Company s utility and non-utility energy businesses are subject to power and fuel price fluctuations, other weather risks, commodity price risks and credit risks that could adversely affect the Company s results of operations. The Company has significant operations outside the United States which may be subject to increased risk because of the economic or political conditions of the country in which they operate. The Company faces exchange rate risk.

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1081316--3/3/2006--MIDAMERICAN_ENERGY_HOLDINGS_CO_/NEW/