OAKLAND,
Calif., Nov. 29, 2023 /PRNewswire/ -- PG&E
Corporation (NYSE: PCG) announced today that it intends to offer,
subject to market and other conditions, $1.5
billion aggregate principal amount of Convertible Senior
Secured Notes due 2027 (the "Convertible Notes") in a private
placement under the Securities Act of 1933, as amended (the
"Securities Act"). PG&E Corporation also intends to grant
to the initial purchasers of the Convertible Notes an option to
purchase, for settlement within a 13-day period from, and
including, the date on which the Convertible Notes are first
issued, up to an additional $225
million aggregate principal amount of the Convertible
Notes.
PG&E Corporation intends to use the net proceeds from the
offering of the Convertible Notes to repay a portion of the loans
outstanding under its $2.75 billion
secured term loan credit agreement entered into in June 2020.
On November 24, 2023, borrowings
under the term loan credit agreement totaled approximately
$2.66 billion. Such borrowings
bear interest based at a floating rate (approximately 8.44% per
annum on November 24, 2023).
The term loan credit agreement matures on June 23, 2025, unless extended by PG&E
Corporation pursuant to its terms.
The Convertible Notes will be general senior secured obligations
of PG&E Corporation and will be secured on a first lien basis
by the pledge of PG&E Corporation's ownership interest in 100%
of the shares of common stock of its principal subsidiary, Pacific
Gas and Electric Company (the "Utility"), and any other shares of
common stock of the Utility obtained by PG&E Corporation in the
future and the certificates or instruments representing such shares
of common stock (collectively, "Collateral"), subject to certain
permitted liens. The Convertible Notes will not initially be
guaranteed by the Utility or any of PG&E Corporation's other
subsidiaries. The Convertible Notes will rank equal in right
of payment with all of PG&E Corporation's existing and future
senior obligations; will rank effectively junior to all of PG&E
Corporation's existing and future senior secured obligations that
are secured by assets other than the Collateral to the extent of
the value of such assets securing such obligations; will rank
effectively junior to all existing and future senior secured
obligations under PG&E Corporation's revolving credit facility
to the extent of the value of the Collateral (up to an amount not
to exceed $650 million), and equal
with all of PG&E Corporation's other existing and future senior
secured obligations to the extent secured by the Collateral; will
rank effectively senior to any of PG&E Corporation's existing
and future unsecured obligations to the extent of the value of the
Collateral; will rank senior in right of payment to all of PG&E
Corporation's future subordinated indebtedness; and will be
structurally subordinated to all indebtedness and other obligations
(including trade payables, other secured and unsecured indebtedness
and preferred stock obligations) of the Utility and all of PG&E
Corporation's other subsidiaries (other than any subsidiaries that
may become guarantors in the future).
The Convertible Notes will mature on December 1, 2027, unless earlier converted or
repurchased. Interest on the Convertible Notes will be paid
semiannually in arrears on June 1 and
December 1 of each year, beginning on
June 1, 2024. Prior to the close of
business on the business day immediately preceding September 1, 2027, the Convertible Notes will be
convertible only upon the occurrence of certain events and during
certain periods. On or after September 1,
2027, the Convertible Notes will be convertible by holders
at any time in whole or in part until the close of business on the
business day immediately preceding the maturity date. PG&E
Corporation will settle conversions of the Convertible Notes by
paying or delivering, as the case may be, cash, shares of PG&E
Corporation's common stock, no par value ("Common Stock"), or a
combination of cash and shares of Common Stock ("Combination
Settlement"), at its election. PG&E Corporation's current
intent and policy is to settle conversions through Combination
Settlement with a specified dollar amount (payable in cash) per
$1,000 principal amount of
Convertible Notes of $1,000. PG&E
Corporation may not redeem the Convertible Notes prior to the
maturity date. The final terms of the Convertible Notes, including
the interest rate, initial conversion rate and certain other terms
of the Convertible Notes, will be determined at the time of pricing
of the offering.
The offering is being made only to persons reasonably believed
to be qualified institutional buyers pursuant to Rule 144A under
the Securities Act. Any offers of the Convertible Notes will be
made only by means of a private offering memorandum. None of the
Convertible Notes or any shares of the Common Stock issuable upon
conversion of the Convertible Notes have been or are expected to be
registered under the Securities Act or any state securities laws
and, unless so registered, may not be offered or sold in
the United States or to U.S.
persons except pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the Securities Act
and applicable state securities laws.
This news release is for informational purposes only and does
not constitute an offer to sell or purchase, or the solicitation of
an offer to sell or purchase these securities, nor will there be
any sale of these securities in any state or other jurisdiction in
which such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such
state or other jurisdiction.
About PG&E Corporation
PG&E Corporation (NYSE: PCG) is a holding company
headquartered in Oakland,
California. It is the parent company of the Utility, an
energy company that serves 16 million Californians across a
70,000-square-mile service area in Northern and Central California.
Forward-Looking Statements
This news release contains forward-looking statements that are
not historical facts, including statements about the closing of the
offering of the Convertible Notes and the expected use of proceeds
from the offering. These statements are based on current
expectations and assumptions, which management believes are
reasonable, and on information currently available to management,
but are necessarily subject to various risks and uncertainties. In
addition to the risk that these assumptions prove to be inaccurate,
factors that could cause actual results to differ materially from
those contemplated by the forward-looking statements include
factors disclosed in PG&E Corporation's annual report on Form
10-K for the year ended December 31,
2022, its most recent quarterly report on Form 10-Q for the
quarter ended September 30, 2023, and
other reports filed with the SEC, which are available on the SEC's
website. PG&E Corporation undertakes no obligation to publicly
update or revise any forward-looking statements, whether due to new
information, future events or otherwise, except to the extent
required by law.
View original content to download
multimedia:https://www.prnewswire.com/news-releases/pge-corporation-announces-proposed-offering-of-1-5-billion-convertible-senior-secured-notes-due-2027-to-repay-portion-of-existing-term-loan-302000587.html
SOURCE PG&E Corporation