01—Abstract
Summary
Summary of the 8-K filed September 24, 2025. Cited figures are marked; the original filing is the authoritative source.
On September 24, 2025, Pacific Gas and Electric Company (the "Utility") entered into a $500,000,000a Term Loan Credit Agreement with several lenders and Wells Fargo Bank, National Association, as administrative agent, and borrowed the full amount the same day.
The loans mature on September 23, 2026. Borrowings bear interest at either Term SOFR plus an applicable margin of 1.25%b, or the alternative base rate plus an applicable margin of 0.25%, at the Utility's election. The Utility's obligations under the facility are secured by a first mortgage bond issued under a Thirtieth Supplemental Indenture to the Mortgage Indenture.
The bond is secured by a first lien on substantially all of the Utility's real property and certain tangible personal property related to its facilities, subject to exceptions, and ranks pari passu with its other first mortgage bonds. The Credit Agreement contains customary covenants limiting liens, sale and leaseback transactions, fundamental changes, swap agreements and modifications to the Mortgage Indenture, and requires a ratio of total consolidated debt to consolidated capitalization of no greater than 65% at each fiscal quarter end. The agreement includes customary events of default, including cross-defaults to specified other debt of the Utility or its significant subsidiaries exceeding $200 millionc.
Upon a default, the administrative agent may, with required lender consent (or at required lenders' request, must), accelerate amounts outstanding; insolvency, bankruptcy or receivership events cause automatic acceleration. The filing is a short notice, with the full agreement and the indenture supplement filed as Exhibits 10.1 and 4.1.
02—Key points
Key Highlights
- Pacific Gas and Electric Company borrowed the full $500,000,000 under a Term Loan Credit Agreement on September 24, 2025.
- The loans mature on September 23, 2026, a one-year term.
- Interest is Term SOFR plus 1.25%, or the alternative base rate plus 0.25%, at the Utility's election.
- The facility is secured by a first mortgage bond with a first lien on substantially all of the Utility's real property and certain tangible personal property, ranking pari passu with its other first mortgage bonds.
- A maximum total consolidated debt to consolidated capitalization ratio of 65% is required at each fiscal quarter end.
- Cross-default provisions apply to specified other debt of the Utility or its significant subsidiaries exceeding $200 million.
- The collateral bond was issued under a Thirtieth Supplemental Indenture to the Mortgage Indenture with The Bank of New York Mellon Trust Company, N.A., as trustee.
03—Questions
Frequently Asked Questions
How much did PG&E's utility subsidiary borrow and when does it mature?
Pacific Gas and Electric Company borrowed the entire $500,000,000 under the Credit Agreement on September 24, 2025. The loans mature on September 23, 2026.
What interest rate applies to the borrowings?
The Utility may elect either Term SOFR plus an applicable margin of 1.25%, or the alternative base rate plus an applicable margin of 0.25%.
What collateral secures the loan?
The obligations are secured by a first mortgage bond issued under the Thirtieth Supplemental Indenture, which is secured by a first lien on substantially all of the Utility's real property and certain tangible personal property related to its facilities, subject to certain exceptions. The bond ranks pari passu with the Utility's other first mortgage bonds.
What financial covenant and restrictions does the agreement include?
The agreement requires a ratio of total consolidated debt to consolidated capitalization of no greater than 65% at the end of each fiscal quarter. It also limits, with certain exceptions, liens, sale and leaseback transactions, fundamental changes, entering into swap agreements, and modifications to the Mortgage Indenture.
When could the lenders accelerate the debt?
In a default, including cross-defaults on specified other debt of the Utility or significant subsidiaries exceeding $200 million, the administrative agent may, with required lender consent (or must, upon required lender request), declare outstanding amounts and accrued interest immediately payable. Insolvency, bankruptcy or receivership events make amounts payable immediately.
04—Continue