8-KMaterial AgreementsFinancial Events

EXELON CORP 8-K Report, Material Agreement (Nov 30, 2017)

Filed November 30, 2017For Securities:EXC

Summary

Exelon Corporation, through its indirect subsidiary ExGen Renewables IV, LLC, has successfully secured an $850 million senior secured term loan credit facility. This facility, established on November 28, 2017, with a maturity date of November 28, 2024, provides net proceeds of approximately $785 million. These funds are expected to be distributed to the sponsor, Exelon Generation Company, LLC, for general corporate purposes. The loan carries an interest rate based on LIBOR plus 3.00% or Base Rate plus 2.00%, payable quarterly. The financing is fully guaranteed by ExGen Renewables IV Holding, LLC and ExGen Renewables Holdings, LLC, and is secured by collateral owned by the loan parties. The terms include customary covenants and default provisions for the benefit of the lenders, as well as provisions for acceleration and mandatory prepayments under certain events. This facility represents a significant debt financing for Exelon's renewable energy segment.

Key Highlights

  • 1ExGen Renewables IV, LLC, an indirect subsidiary of Exelon, closed an $850 million senior secured term loan credit facility.
  • 2The facility was established on November 28, 2017, and is set to mature on November 28, 2024 (a 7-year term).
  • 3Net proceeds of approximately $785 million were received after deducting fees and expenses.
  • 4Proceeds are intended for general corporate purposes of the sponsor, Exelon Generation Company, LLC.
  • 5The loan bears interest at LIBOR + 3.00% or Base Rate + 2.00%.
  • 6Obligations are fully guaranteed by Holdings and ExGen Renewables Holdings, LLC.
  • 7The facility is secured by collateral owned by the loan parties.

Frequently Asked Questions

The net proceeds of approximately $785 million from this term loan are expected to be distributed to the sponsor, Exelon Generation Company, LLC, for its general corporate purposes. This indicates a need for liquidity or funding for broader corporate initiatives within Exelon.

The facility matures in seven years on November 28, 2024. Interest accrues at a rate of either LIBOR plus 3.00% or Base Rate plus 2.00%. Payments are due quarterly, with the principal due on the maturity date. The loan is senior secured and guaranteed by related entities.

The borrower is ExGen Renewables IV, LLC. The sponsor is Exelon Generation Company, LLC. Morgan Stanley Senior Funding, Inc. acts as the administrative agent, and Wilmington Trust, National Association serves as the depositary bank and collateral agent. The loan is also guaranteed by ExGen Renewables IV Holding, LLC and ExGen Renewables Holdings, LLC.

This filing indicates Exelon is raising substantial debt financing for its renewable energy subsidiary. While it provides immediate liquidity, it also increases the company's overall debt burden and future interest expense. Investors should monitor how these funds are utilized and the impact on leverage ratios and profitability.