What did PG&E Corporation sell in this offering?

PG&E Corporation sold 28,000,000 shares of 6.000% Series A Mandatory Convertible Preferred Stock, no par value, with an initial liquidation preference of $50.00 per share. The underwriters also exercised in full their option to purchase an additional 4,200,000 shares.

How much do the preferred shares pay and when?

Dividends accrue at an annual rate of 6.000% on the $50.00 liquidation preference, payable when, as and if declared on March 1, June 1, September 1 and December 1 each year, starting March 1, 2025 and ending December 1, 2027. Dividends may be paid in cash, in common stock subject to certain limitations, or a combination of both.

When and how will the preferred stock convert into common stock?

Unless converted earlier, each preferred share automatically converts on or around December 1, 2027 into between 1.9465 and 2.4331 common shares, based on the 20-trading-day volume weighted average price of the common stock ending before that date. Holders may convert earlier, outside a fundamental change conversion period, at the minimum rate of 1.9465 shares per preferred share, subject to anti-dilution adjustments.

How does the preferred stock rank in a liquidation?

In a voluntary or involuntary liquidation, holders are entitled to $50.00 per share plus accumulated and unpaid dividends, paid after creditors and any senior stock and before any distribution to junior stock, including common stock.

Are there restrictions on common stock dividends or buybacks while the preferred is outstanding?

Yes. Subject to certain exceptions, no dividend may be paid on common stock or other junior stock, and no common or junior or parity stock may be repurchased or redeemed by PG&E Corporation or its subsidiaries, unless all accumulated and unpaid preferred dividends have been declared and paid or set aside.

PCG 8-K: Material Agreements, Shareholder Matters & More

01—Abstract

Summary

Summary of the 8-K filed December 5, 2024. Cited figures are marked; the original filing is the authoritative source.

PG&E Corporation filed this Form 8-K to report the completed offering of 6.000%^a Series A Mandatory Convertible Preferred Stock.

The company agreed on December 2, 2024 to sell 28,000,000 shares with an initial liquidation preference of $50.00^b per share, and the underwriters exercised their option in full on December 3, 2024 to buy an additional 4,200,000 shares. The offering closed on December 5, 2024, and was made under a Form S-3 shelf registration statement (File No. 333-277286) filed February 22, 2024. The preferred stock pays cumulative dividends at an annual rate of 6.000% on the $50.00 liquidation preference, when, as and if declared by the board, payable quarterly on March 1, June 1, September 1 and December 1, starting March 1, 2025.

Dividends may be paid in cash, in common stock subject to limitations, or in a combination. While preferred shares remain outstanding, no common dividends or repurchases may be made unless accumulated preferred dividends have been paid or set aside. Each preferred share will mandatorily convert on or around December 1, 2027 into between 1.9465 and 2.4331 shares of common stock, with the exact rate determined by the volume weighted average price of the common stock over a 20-trading-day period.

Holders may convert earlier at the minimum rate of 1.9465 shares, subject to adjustments. On liquidation, holders receive $50.00^c per share plus accumulated unpaid dividends, ranking ahead of common stock. The Certificate of Determination was filed with the California Secretary of State and became effective December 5, 2024.

02—Key points

Key Highlights

Issued 28,000,000 shares of 6.000% Series A Mandatory Convertible Preferred Stock at a $50.00 initial liquidation preference, with the underwriters' 4,200,000-share over-allotment option exercised in full on December 3, 2024.
Offering closed December 5, 2024, sold under a Form S-3 shelf registration statement filed February 22, 2024.
Preferred dividends are cumulative at 6.000% annually, payable quarterly on March 1, June 1, September 1 and December 1, beginning March 1, 2025, and may be paid in cash or common stock.
Mandatory conversion on or around December 1, 2027 into between 1.9465 and 2.4331 common shares per preferred share, based on a 20-trading-day VWAP; holders may convert earlier at a minimum rate of 1.9465.
Preferred holders rank ahead of common stock in liquidation, receiving $50.00 per share plus accumulated unpaid dividends.
While preferred shares are outstanding, common dividends and junior stock repurchases are restricted unless accumulated preferred dividends are paid or set aside.
Certificate of Determination establishing the preferred terms was filed with the California Secretary of State and became effective December 5, 2024.

03—Questions

Frequently Asked Questions

What did PG&E Corporation sell in this offering?
PG&E Corporation sold 28,000,000 shares of 6.000% Series A Mandatory Convertible Preferred Stock, no par value, with an initial liquidation preference of $50.00 per share. The underwriters also exercised in full their option to purchase an additional 4,200,000 shares.
How much do the preferred shares pay and when?
Dividends accrue at an annual rate of 6.000% on the $50.00 liquidation preference, payable when, as and if declared on March 1, June 1, September 1 and December 1 each year, starting March 1, 2025 and ending December 1, 2027. Dividends may be paid in cash, in common stock subject to certain limitations, or a combination of both.
When and how will the preferred stock convert into common stock?
Unless converted earlier, each preferred share automatically converts on or around December 1, 2027 into between 1.9465 and 2.4331 common shares, based on the 20-trading-day volume weighted average price of the common stock ending before that date. Holders may convert earlier, outside a fundamental change conversion period, at the minimum rate of 1.9465 shares per preferred share, subject to anti-dilution adjustments.
How does the preferred stock rank in a liquidation?
In a voluntary or involuntary liquidation, holders are entitled to $50.00 per share plus accumulated and unpaid dividends, paid after creditors and any senior stock and before any distribution to junior stock, including common stock.
Are there restrictions on common stock dividends or buybacks while the preferred is outstanding?
Yes. Subject to certain exceptions, no dividend may be paid on common stock or other junior stock, and no common or junior or parity stock may be repurchased or redeemed by PG&E Corporation or its subsidiaries, unless all accumulated and unpaid preferred dividends have been declared and paid or set aside.

04—Continue

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