8-KMaterial AgreementsExhibits & Filings

EXELON CORP 8-K Report, Material Agreement (Aug 14, 2013)

Filed August 14, 2013For Securities:EXC

Summary

Exelon Corporation (Exelon) and its subsidiary Commonwealth Edison Company (ComEd) have entered into amendments to their respective revolving credit facilities. These amendments are designed to address the non-cash impact arising from the IRS's challenge to Exelon's 1999 federal income tax return regarding the sale of ComEd's fossil generating assets in a like-kind exchange. Specifically, the amendments will exclude this particular tax matter's non-cash effect from the calculation of the interest coverage ratio under these credit agreements. In addition to the tax-related amendments, Exelon and several of its other subsidiaries, including Exelon Generation Company, LLC, PECO Energy Company, and Baltimore Gas and Electric Company, have extended the maturity of their unsecured revolving credit facilities by one year, pushing the new maturity date to August 10, 2018. This provides continued access to these credit lines for a longer period.

Key Highlights

  • 1Amendments made to revolving credit facilities for Exelon Corporation and Commonwealth Edison Company.
  • 2Amendments address the IRS challenge regarding a 1999 like-kind exchange of ComEd's fossil generating assets.
  • 3The non-cash impact of the like-kind exchange tax matter is excluded from interest coverage ratio calculations.
  • 4Maturity dates for unsecured revolving credit facilities of Exelon, Exelon Generation, PECO Energy, and Baltimore Gas and Electric extended by one year.
  • 5New maturity date for extended credit facilities is August 10, 2018.
  • 6Total aggregate bank commitments for the extended facilities amount to $500 million (Exelon), $5.3 billion (Exelon Generation), $600 million (PECO), and $600 million (Baltimore Gas and Electric).

Frequently Asked Questions

The amendments aim to remove the non-cash financial impact of a dispute with the IRS concerning a 1999 tax transaction (like-kind exchange of fossil generating assets) from the calculation of the interest coverage ratio under their credit agreements. This is intended to prevent this specific tax issue from negatively affecting their compliance with credit facility covenants.

Exelon Corporation, Exelon Generation Company, LLC, PECO Energy Company, and Baltimore Gas and Electric Company had their unsecured revolving credit facilities extended.

The maturity dates for the specified unsecured revolving credit facilities have been extended by one year to August 10, 2018.

No, this filing does not indicate immediate financial distress. The amendments are proactive measures to manage the impact of a past tax issue on credit covenants and extend existing credit lines, which are common financial management activities for large corporations.