PG&E 2010 Annual Report Download - page 81

CREDIT FACILITIES AND SHORT-TERM BORROWINGS
The following table summarizes PG&E Corporation’s and the Utility’s borrowings on outstanding credit facilities at
December 31, 2010:
(in millions) Termination Date Facility Limit
Letters
of Credit
Outstanding Cash Borrowings
Commercial
Paper
Backup Availability
PG&E Corporation February 2012 $ 187 (1) $ – $ – N/A $ 187
Utility February 2012 1,940 (2) 329 – $ 603 1,008
Utility February 2012 750 (3) N/A – – 750
Total credit facilities $ 2,877 $ 329 $ – $ 603 $ 1,945
(1) Includes a $87 million sublimit for letters of credit and a $100 million commitment for “swingline” loans, defined as loans that are made available
on a same-day basis and are repayable in full within 30 days.
(2) Includes a $921 million sublimit for letters of credit and a $200 million commitment for swingline loans.
(3) Includes a $75 million commitment for swingline loans.
PG&E CORPORATION
Revolvingcredit facility
PG&E Corporation has a $187 million revolving credit
facility with a syndicate of lenders that expires on
February 26, 2012. Borrowings under the revolving credit
facility and letters of credit may be used for working
capital and other corporate purposes. PG&E Corporation
can, at any time, repay amounts outstanding in whole or
in part. At PG&E Corporation’s request and at the sole
discretion of each lender, the revolving credit facility may
be extended for additional periods. PG&E Corporation
has the right to increase, in one or more requests given no
more than once a year, the aggregate facility by up to
$100 million, provided that certain conditions are met.
The fees and interest rates that PG&E Corporation pays
under the revolving credit facility vary depending on the
Utility’s unsecured debt ratings issued by Standard &
Poor’s (“S&P”) ratings service and Moody’s Investors
Service (“Moody’s”).
The revolving credit facility includes usual and
customary covenants for credit facilities of this type,
including covenants limiting liens, mergers, sales of all or
substantially all of PG&E Corporation’s assets, and other
fundamental changes. In general, the covenants,
representations, and events of default mirror those in the
Utility’s revolving credit facility, discussed below. In
addition, the revolving credit facility requires that PG&E
Corporation maintain a ratio of total consolidated debt to
total consolidated capitalization of at most 65% and that
PG&E Corporation own, directly or indirectly, at least
80% of the common stock and at least 70% of the voting
securities of the Utility. At December 31, 2010, PG&E
Corporation met both of these tests.
UTILITY
Revolvingcredit facilities
The Utility has a $1.9 billion revolving credit facility with
a syndicate of lenders that expires on February 26, 2012.
Borrowings under the revolving credit facility and letters
of credit are used primarily for liquidity and to provide
credit enhancements to counterparties for natural gas and
energy procurement transactions.
On June 8, 2010, the Utility entered into a $750
million unsecured revolving credit agreement with a
syndicate of lenders. Of the total credit capacity, $500
million was used to replace the $500 million Floating
Rate Senior Notes that matured on June 10, 2010. The
aggregate facility of $750 million includes a $75 million
commitment for swingline loans, or loans that are made
available on a same-day basis and are repayable in full
within 30 days. The Utility can, at any time, repay
amounts outstanding in whole or in part. The credit
agreement expires on February 26, 2012, unless extended
for additional periods at the Utility’s request and at the
sole discretion of each lender.
Borrowings under the credit agreement (other than
swingline loans) will bear interest based, at the Utility’s
election, at (1) London Interbank Offered Rate (“LIBOR”)
plus an applicable margin or (2) the base rate, which will
equal the higher of the (i) administrative agent’s
announced base rate, (ii) 0.5% above the federal funds
rate, or (iii) the one-month LIBOR plus an applicable
margin. Interest is payable quarterly in arrears, or earlier
for loans with shorter interest periods. The Utility also
will pay a facility fee on the total commitments of the
lenders under the credit agreement. The applicable
margin for LIBOR loans and the facility fee will be based
on the Utility’s senior unsecured, non-credit enhanced
debt ratings issued by S&P and Moody’s. Facility fees are
payable quarterly in arrears.
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