Company: PCG-PB
Filing Date: 2025-02-13
Form Type: 10-K
Source: 0001004980-25-000010
Chunk: 281

Company: PG&E Corp
Filing Date: 2025-02-13
Form: 10-K
Item: Item 1A
Chunk 281
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 an “ownership change,” such net operating loss carryforwards and other tax attributes may be subject to certain limitations.  In general, an ownership change occurs if the aggregate value of the stock ownership of certain shareholders (generally five percent shareholders, applying certain look-through and aggregation rules) increases by more than 50% over such shareholders’ lowest percentage ownership during the testing period (generally three years).

As of the date of this report, it is more likely than not that PG&E Corporation has not undergone an ownership change and its net operating loss carryforwards and other tax attributes are not limited by Section 382 of the IRC.  However, whether PG&E Corporation underwent an ownership change as a result of the transactions in PG&E Corporation’s equity that occurred pursuant to the Plan or in combination with other changes in the ownership of PG&E Corporation’s equity depends on several factors outside PG&E Corporation’s control and the application of certain laws that are uncertain in several respects.  Accordingly, the IRS may successfully assert that PG&E Corporation has undergone an ownership change pursuant to the Plan.  If the IRS successfully asserts that PG&E Corporation did undergo, or PG&E Corporation otherwise does undergo, an ownership change, the limitation on its net operating loss carryforwards and other tax attributes under Section 382 of the IRC could be material to PG&E Corporation’s and the Utility’s financial condition, results of operations, liquidity, and cash flows.

In particular, limitations imposed on PG&E Corporation’s ability to utilize net operating loss carryforwards or other tax attributes could cause U.S. federal and California income taxes to be paid earlier than would be paid if such limitations were not in effect and could cause such net operating loss carryforwards or other tax attributes to expire unused, in each case reducing or eliminating the benefit of such net operating loss carryforwards and other tax attributes. Further, PG&E Corporation’s ability to utilize its net operating loss carryforwards is critical to PG&E Corporation’s and the Utility’s commitment to make certain operating and capital expenditures.  Failure to obtain alternative sources of capital could have a material adverse effect on PG&E Corporation and the Utility and the value of PG&E Corporation capital stock.

PG&E Corporation is a holding company and relies on dividends, distributions, and other payments, advances, and transfers of funds from the Utility to pay dividends on its capital stock and meet its obligations.

PG&E Corporation conducts its operations primarily through its subsidiary, the Utility, and substantially all of PG&E Corporation’s consolidated assets are held by the Utility.