Exhibit 10.3

Execution Version

JPMORGAN CHASE BANK, N.A.
383 Madison Avenue
New York, NY 10179
 
BANK OF AMERICA, N.A.
BofA SECURITIES, INC.
One Bryant Park
New York, NY 10036
 
BARCLAYS
745 Seventh Avenue
New York, NY 10019
 
CITIGROUP GLOBAL MARKETS INC.
388 Greenwich Street
New York, NY 10013
 
GOLDMAN SACHS BANK USA
GOLDMAN SACHS LENDING PARTNERS LLC
200 West Street
New York, NY 10282
 
BNP PARIBAS
787 Seventh Avenue
New York, New York 10019
CREDIT SUISSE AG, CAYMAN ISLANDS
BRANCH
Eleven Madison Avenue
New York, New York 10010
 
MORGAN STANLEY BANK, N.A.
1585 Broadway
New York, New York 10036
 
MUFG UNION BANK, N.A.
1221 Avenue of the Americas
New York, NY 10020
 
WELLS FARGO BANK, NATIONAL
ASSOCIATION
550 S Tryon St.
Charlotte, NC 28202
 
MIZUHO BANK, LTD.
1251 Avenue of the Americas
New York, NY 10020
 
 

PERSONAL AND CONFIDENTIAL

December 20, 2019

PG&E Corporation
Pacific Gas and Electric Company
77 Beale Street
P.O. Box 77000
San Francisco, California 94177
Attention:          Nicholas M. Bijur

Pacific Gas and Electric Company
Amendment No. 2 to Commitment Letter

Ladies and Gentlemen:

Reference is made to that certain Commitment Letter, dated as of October 4, 2019
(together with the annexes thereto, as supplemented by that certain Joinder
Letter dated as of October 28, 2019, that certain Amendment No. 1 to Commitment
Letter dated as of November 18, 2019, that certain Joinder Letter dated as of
December 2, 2019 and as further amended from time to time in accordance with the
terms thereof, the “Commitment Letter”), between PG&E Corporation, a California
corporation (or

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any domestic entity formed to hold all of the assets of PG&E Corporation upon
emergence from bankruptcy) (“PG&E”), Pacific Gas and Electric Company, a
California corporation (the “Utility”) (together with any domestic entity formed
to hold all of the assets of the Utility upon emergence from bankruptcy, the
“Borrower” and together with PG&E, the “Debtors” or “you”), JPMorgan Chase Bank,
N.A. (“JPMorgan”), Bank of America, N.A. (“BANA”), BofA Securities, Inc. (or any
of its designated affiliates, “BofA”, and together with BANA, “Bank of
America”), Barclays Bank PLC (“Barclays”), Citigroup Global Markets Inc. on
behalf of Citi (as defined below), Goldman Sachs Bank USA (“GS Bank”) and
Goldman Sachs Lending Partners LLC (“GSLP”, and together with GS Bank, “Goldman
Sachs”) (JPMorgan, Bank of America, Barclays, Citi and Goldman Sachs,
collectively, the “Initial Commitment Parties”) and BNP Paribas (“BNP”), Credit
Suisse AG, Cayman Islands Branch (“Credit Suisse”), Morgan Stanley Bank, N.A.
(“Morgan Stanley”), MUFG Union Bank, N.A. (“MUFG”), Wells Fargo Bank, National
Association (“Wells Fargo”) and Mizuho Bank, Ltd. (“Mizuho”, collectively with
BNP, Credit Suisse, Morgan Stanley, MUFG, Wells Fargo and the Initial Commitment
Parties, the “Commitment Parties” , “we” or “us”), regarding a $27,350 million
senior secured bridge facility defined therein as the Facility and the related
transactions described therein. “Citi” shall mean Citigroup Global Markets Inc.,
Citibank N.A., Citicorp USA, Inc., Citicorp North America, Inc. and/or any of
their affiliates as any of them shall determine to be appropriate to provide the
services contemplated herein. Capitalized terms used but not defined herein are
used with the meanings assigned to them in the Commitment Letter.

Each party to this Amendment No. 2 to Commitment Letter (this “Amendment”)
hereby agrees that the Commitment Letter is hereby amended to delete the
stricken text (indicated textually in the same manner as the following
example: stricken text) and to add the double-underlined text (indicated
textually in the same manner as the following example: double-underlined text)
as set forth in Schedule I hereto. The Commitment Letter shall be deemed to be
replaced in its entirely by the Commitment Letter modified to reflect the terms
set forth in Schedule I hereto, and each person party hereto as a Commitment
Party shall be the sole Commitment Parties under the Commitment Letter on the
date hereof after giving effect to this Amendment, and shall have and hereby
reaffirm their commitments under the Commitment Letter set forth in Schedule II
to the Commitment Letter, subject to the terms and conditions set forth in the
Commitment Letter as amended by this Amendment.

Each party hereto agrees to maintain the confidentiality of this Amendment and
the terms hereof, subject to the confidentiality provisions contained in the
Commitment Letter. The provisions of the third paragraph of Section 9 of the
Commitment Letter are incorporated herein, mutatis mutandis, as if the
references to the Commitment Letter were to this Amendment. Each of the parties
hereto (for itself and its affiliates) (a) waives, to the fullest extent it may
legally and effectively do so, any objection that it may now or hereafter have
to the laying of venue of any suit, action or proceeding arising out of or
relating to the Commitment Letter, this Amendment, or the transactions
contemplated thereby or hereby, in any such New York State court or in any such
Federal court and (b) waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such court.

Except as specifically amended by this Amendment, the Commitment Letter shall
remain in full force and effect. This Amendment shall be construed in connection
with and form part of the Commitment Letter, and any reference to the Commitment
Letter shall be deemed to be a reference to the Commitment Letter as amended by
this Amendment. Neither this Amendment nor the Commitment Letter (including the
attachments hereto and thereto) may be amended or any term or provision hereof
or thereof waived or modified except by an instrument in writing signed by each
of the parties hereto. This Amendment may be executed in any number of
counterparts, each of which when executed will be an original, and all of which,
when taken together, will constitute one agreement. Delivery of an executed

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counterpart of a signature page to this Amendment by telecopier, facsimile or
other electronic transmission (e.g., “pdf” or “tif”) shall be effective as
delivery of a manually executed counterpart thereof.

[Remainder of page intentionally left blank]

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We are pleased to have been given the opportunity to assist you in connection
with the financing for the Transactions.

  Very truly yours,           JPMORGAN CHASE BANK, N.A.          

By:
/s/ Sandeep S. Parihar       Name:  Sandeep S. Parihar       Title:  Executive
Director          

[Signature Page to Amendment No. 2 to Commitment Letter (Utility)]

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  BofA SECURITIES, INC.          

By:
/s/ B. Timothy Keller       Name:  B. Timothy Keller       Title:  Managing
Director          

  BANK OF AMERICA, N.A.          

By:
/s/ Maggie Halleland       Name:  Maggie Halleland       Title:  Vice President
         

[Signature Page to Amendment No. 2 to Commitment Letter (Utility)]

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  BARCLAYS BANK PLC          

By:
/s/ Sydney G. Dennis       Name:  Sydney G. Dennis       Title:  Director      
   

[Signature Page to Amendment No. 2 to Commitment Letter (Utility)]

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  CITIGROUP GLOBAL MARKETS INC.          

By:
/s/ Richard D. Rivera       Name:  Richard D. Rivera       Title:  Authorized
Signatory          

[Signature Page to Amendment No. 2 to Commitment Letter (Utility)]

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  GOLDMAN SACHS BANK USA          

By:
/s/ Charles D. Johnston       Name:  Charles D. Johnston       Title:
 Authorized Signatory          

  GOLDMAN SACHS LENDING PARTNERS LLC          

By:
/s/ Charles D. Johnston       Name:  Charles D. Johnston       Title:
 Authorized Signatory          

[Signature Page to Amendment No. 2 to Commitment Letter (Utility)]

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  BNP PARIBAS          

By:
/s/ Dennis O’Meara       Name:  Dennis O’Meara       Title:  Managing Director  
       

By:
/s/ Ravina Advani       Name:  Ravina Advani       Title:  Managing Director    
     

[Signature Page to Amendment No. 2 to Commitment Letter (Utility)]

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  CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH          

By:
/s/ Mikhail Faybusovich       Name:  Mikhail Faybusovich       Title:
 Authorized Signatory          

By:
/s/ SoVonna Day-Goins       Name:  SoVonna Day-Goins       Title:  Authorized
Signatory          

[Signature Page to Amendment No. 2 to Commitment Letter (Utility)]

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  MORGAN STANLEY BANK, N.A.          

By:
/s/ Mrinalini MacDonough       Name:  Mrinalini MacDonough       Title:
 Authorized Signatory          

[Signature Page to Amendment No. 2 to Commitment Letter (Utility)]

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  MUFG UNION BANK, N.A.          

By:
/s/ Viet-Linh Fujitaki       Name:  Viet-Linh Fujitaki       Title:  Vice
President          

[Signature Page to Amendment No. 2 to Commitment Letter (Utility)]

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  WELLS FARGO BANK, NATIONAL ASSOCIATION          

By:
/s/ Gregory R Gredvig       Name:  Gregory R Gredvig       Title:  Director    
     

[Signature Page to Amendment No. 2 to Commitment Letter (Utility)]

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  MIZUHO BANK, LTD.          

By:
/s/ Raymond Ventura       Name:  Raymond Ventura       Title:  Managing Director
         

[Signature Page to Amendment No. 2 to Commitment Letter (Utility)]

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ACCEPTED AND AGREED AS OF
THE DATE FIRST WRITTEN ABOVE:       PG&E CORPORATION        
By:
/s/ Nicholas M. Bijur     Name:  Nicholas M. Bijur     Title:  Vice President
and Treasurer        

PACIFIC GAS AND ELECTRIC COMPANY        
By:
/s/ Nicholas M. Bijur     Name  Nicholas M. Bijur     Title  Vice President and
Treasurer        

[Signature Page to Amendment No. 2 to Commitment Letter (Utility)]

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SCHEDULE I

[Attached]

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Execution Version

JPMORGAN CHASE BANK, N.A.
383 Madison Avenue
New York, NY 10179
 
BANK OF AMERICA, N.A.
BofA SECURITIES, INC.
One Bryant Park
New York, NY 10036
 
BARCLAYS
745 Seventh Avenue
New York, NY 10019
 
CITIGROUP GLOBAL MARKETS INC.
388 Greenwich Street
New York, NY 10013
 
GOLDMAN SACHS BANK USA
GOLDMAN SACHS LENDING PARTNERS LLC
200 West Street
New York, NY 10282
 
 

PERSONAL AND CONFIDENTIAL

October 4, 2019

PG&E Corporation
Pacific Gas and Electric Company
77 Beale Street
P.O. Box 77000
San Francisco, California 94177
Attention:          Nicholas M. Bijur

Pacific Gas and Electric Company
Commitment Letter

Ladies and Gentlemen:

Reference is hereby made to (i) the Chapter 11 bankruptcy cases, jointly
administered under lead case number 19-30088 (the “Chapter 11 Cases”), currently
pending before the United States Bankruptcy Court for the Northern District of
California (the “Bankruptcy Court”), in which PG&E Corporation, a California
corporation (or any domestic entity formed to hold all of the assets of PG&E
upon emergence from bankruptcy) (“PG&E”), and Pacific Gas and Electric Company,
a California corporation (the “Utility”) (together with any domestic entity
formed to hold all of the assets of the Utility upon emergence from bankruptcy,
the “Borrower” and together with PG&E, the “Debtors” or “you”), are debtors and
debtors in possession and (ii) the first amendedjoint Chapter 11 plan of
reorganization filed by the Debtors and the shareholder proponents with the
Bankruptcy Court on September 23December 12, 2019 at ECF No. 39665101 (as may be
further amended, modified or otherwise changed in accordance with this
Commitment Letter, the “Plan”) to implement the terms and conditions of the
reorganization of the Debtors as provided therein. Capitalized terms used and
not defined in this letter (together with Annexes A and B hereto, this
“Commitment Letter”) have the meanings assigned to them in Annexes A and B
hereto as the context may require. JPMorgan, Bank of America, N.A. (“BANA”),
BofA Securities, Inc. (or any of its designated affiliates, “BofA”, and together
with BANA, “Bank of America”), Barclays Bank PLC (“Barclays”), Citigroup Global
Markets Inc. on behalf of Citi (as defined below), Goldman Sachs Bank USA (“GS
Bank”), Goldman Sachs Lending Partners LLC (“GSLP”, and together with GS Bank,
“Goldman Sachs”) and any other Lenders that become parties to this Commitment
Letter as additional “Commitment Parties” as provided in Section 3 hereof
(including those entities listed in

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Schedule I attached hereto) are referred to herein, collectively, as the
“Commitment Parties,” “we” or “us.”

You have informed us that, in connection with the consummation of the
transactions contemplated by the Plan, the Borrower intends to (a) enter into a
new revolving credit facility in an aggregate committed amount of $3,500 million
(the “Revolving Credit Facility”) and (b) issue senior secured notes pursuant to
a registered public offering or Rule 144A or other private placement (the
“Notes”). In connection therewith, the Borrower desires to enter into a $27,350
million senior secured bridge loan facility (the “Facility”) having the terms
and subject to the conditions set forth herein and in the Annexes hereto, to be
available in the event that the Notes are not issued on or prior to the Closing
Date (as defined in Annex A) for any reason.

The transactions described in the preceding paragraphs are collectively referred
to herein as the “Transactions.”

For purposes of this Commitment Letter, “Citi” shall mean Citigroup Global
Markets Inc., Citibank N.A., Citicorp USA, Inc., Citicorp North America, Inc.
and/or any of their affiliates as any of them shall determine to be appropriate
to provide the services contemplated herein.

1.          Commitments; Titles and Roles.

(a) (i) Each of JPMorgan, BofA, Barclays, Citi and GS Bank is pleased to confirm
its agreement to act, and you hereby appoint each of JPMorgan, BofA, Barclays,
Citi and GS Bank to act, as a joint lead arranger and joint bookrunner (in such
capacities, the “Arrangers”) and, except in the case of JPMorgan, co-syndication
agent in connection with the Facility and (ii) each other Commitment Party
accepts, on its own behalf or on behalf of its designated affiliate, the
title(s) agreed to by the Borrower in writing and set forth adjacent to its name
on Schedule I attached hereto under the heading “Title(s)”; (b) JPMorgan is
pleased to confirm its agreement to act, and you hereby appoint JPMorgan to act,
as administrative agent and collateral agent (the “Administrative Agent”) for
the Facility; and (c) each of JPMorgan, BANA, Barclays, Citi, GSLP and GS Bank
(in such capacity, the “Initial Lenders”) and each other Commitment Party is
pleased to commit, and hereby commits, on a several and not joint basis, to
provide the Borrower 20%, 20%, 20%, 20%, 11.042047532% and 8.957952468%,
respectively,a portion of the aggregate principal amount of the Facility equal
to the principal amount set forth adjacent to its name on Schedule II attached
hereto under the heading “Commitment” on the terms contained in this Commitment
Letter and subject to the conditions expressly set forth in Annex B hereto;
provided that the amount of the Facility shall be automatically reduced as
provided under “Mandatory Prepayments and Commitment Reductions” in Annex A
hereto with any such reduction to be applied pro rata among the Initial Lenders.
It is further agreed that JPMorgan will appear on the top left (and the
Arrangers, other than JPMorgan, will appear in alphabetical order immediately to
the right thereof) of the cover page of any marketing materials for the Facility
and will hold the roles and responsibilities conventionally understood to be
associated with such name placement. Our fees for our commitment and for
services related to the Facility are set forth in a separate fee letter (the
“Fee Letter”) entered into by you and the Commitment Parties on the date hereof.
It is agreed that no other agents, co-agents, arrangers, co-arrangers or
bookrunners will be appointed and no other titles will be awarded in connection
with the Facility, and no compensation will be paid in order to obtain such
person’s commitment to participate in the Facility (other than the compensation
expressly contemplated by this Commitment Letter and the Fee Letter) in
connection with the Facility, unless the Arrangers and you shall so agree;
provided, however, that you may award agent (other than administrative agent and
co-syndication agent) and similar titles to any additional Commitment Party that
becomes a Commitment Party hereunder in accordance with the second paragraph of
Section 3 hereof;

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provided, further, for the avoidance of doubt, no additional Commitment Party
shall receive a bookrunner title.

You agree that JPMorgan may perform its responsibilities hereunder through its
affiliate, J.P. Morgan Securities LLC.

2.          Conditions Precedent.

Notwithstanding anything to the contrary in this Commitment Letter, the Fee
Letter or any other agreement or other undertaking concerning the financing of
the Transactions, (a) the Commitment Parties’ commitments and agreements
hereunder with respect to the Facility are subject solely to the satisfaction or
waiver of the conditions expressly set forth in Annex B hereto and (b) the terms
of the Facility Documentation shall be in a form such that they do not impair
the availability of the Facility on the Closing Date if the conditions described
in the immediately preceding clause (a) are satisfied.

3.          Syndication.

The Arrangers reserve the right, in accordance with the provisions of this
Section 3, prior to or after the Closing Date, to syndicate the Facility to the
Lenders (as defined in Annex A). The syndication of the Facility, including
determinations as to the timing of offers to prospective Lenders, the selection
of Lenders, the acceptance and final allocation of commitments, the awarding of
titles or roles to any Lenders and the amounts offered and the compensation
provided to each Lender from the amounts to be paid to the Arrangers pursuant to
the terms of this Commitment Letter and the Fee Letter, will be conducted by the
Arrangers in consultation with the Borrower. Notwithstanding the foregoing,
during the period commencing on the date hereof and ending November 20, 2019
(the “Initial Syndication Period”), the Facility will be syndicated only to
those financial institutions approved by you in writing prior to the date hereof
or other financial institutions as may be approved by you in your sole
discretion (such financial institutions, collectively, the “Approved Lenders”).
Following the Initial Syndication Period, if and for so long as a Successful
Syndication (as defined in the Fee Letter) has not been achieved, the
syndication of the Facility shall be conducted by the Arrangers in consultation
with the Borrower. Following the achievement of a Successful Syndication of the
Facility, further assignments and commitments shall be in accordance with the
section captioned “Assignments and Participations” in the Term Sheet attached
hereto as Annex A.

The aggregate commitments of the Commitment Parties with respect to the Facility
shall be reduced dollar-for-dollar (and on a pro rata basis) by the amount of
each commitment for the Facility received from additional Lenders selected in
accordance with the preceding paragraph to the extent such Lender becomes (a)
party to this Commitment Letter as an additional “Commitment Party” pursuant to
a customary joinder agreement or other documentation reasonably satisfactory to
the Arrangers and you (each, a “Joinder Agreement”) or (b) party to the Facility
Documentation as a Lender; provided that any reduction of Goldman Sachs’s
commitments under the Facility in accordance with the previous sentence or as a
result of a reduction of the overall commitments of GSLP and GS Bank, each in
its capacity as an Initial Lender, pursuant to the terms of this Commitment
Letter shall be allocated between GSLP’s and GS Bank’s respective commitments as
determined by GSLP and GS Bank in their sole discretion. Notwithstanding the
Arrangers’ right to syndicate the Facility and receive commitments with respect
thereto, and except as provided in the immediately preceding sentence, (i) no
Commitment Party shall be relieved, released or novated from its obligations
hereunder (including its obligation to fund the Facility on the Closing Date) in
connection with any syndication, assignment or participation of the Facility,
including its commitment in respect thereof, until after the initial funding of
the Facility

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on the Closing Date has occurred, (ii) no assignment or novation shall become
effective with respect to all or any portion of the Commitment Parties’
commitments in respect of the Facility until the initial funding of the
Facility on the Closing Date and (iii) unless you otherwise agree in writing,
each Commitment Party shall retain exclusive control over all rights and
obligations with respect to its commitments in respect of the Facility,
including all rights with respect to consents, modifications, supplements,
waivers and amendments, until the initial funding of the Facility on the Closing
Date has occurred.

To facilitate an orderly and successful syndication of the Facility, you agree
that, until the earlier of (a) the achievement of a Successful Syndication (as
defined in the Fee Letter) and (b) 60 days following the Closing Date (such
earlier date, the “Syndication Date”), PG&E and the Borrower will not syndicate
or issue, attempt to syndicate or issue or announce the syndication or issuance
of any competing debt facility or any debt or equity security (other than common
equity) of PG&E, the Borrower or any of their respective subsidiaries that would
reasonably be expected to materially impair the primary syndication of the
Facility, in each case without the prior written consent of the Arrangers (such
consent not to be unreasonably withheld, delayed or conditioned), other than (i)
the Facility, (ii) the Notes, (iii) the Revolving Credit Facility, (iv)
incremental facilities under the Borrower’s current debtor-in-possession credit
agreement or any new debtor-in-possession facilities, in either case that are to
be paid in full in cash at emergence from the Chapter 11 Cases, (v)
securitization securities or facilities contemplated by the Plan, (vi)
ordinary-course purchase money indebtedness, facility and equipment financings,
other debt incurred in the ordinary course of business for capital expenditures
and working capital purposes, financial leases or capital lease obligations,
overdraft protection, ordinary course letter of credit facilities, hedging and
cash management, and similar obligations, (vii) roll-over, “take-back” or
reinstated debt that may be contemplated by the Plan and (viii) common and
preferred equity issued in accordance with the Plan in satisfaction of claims.

Without limiting your obligations to assist with the syndication efforts as set
forth herein, it is understood that the Initial Lender’s commitmentCommitment
Parties’ commitments hereunder isare not conditioned upon the syndication of, or
receipt of commitments in respect of, the Facility and in no event shall the
commencement or successful completion of syndication of the Facility constitute
a condition to the availability of the Facility on the Closing Date.

Until the Syndication Date, you agree to actively assist the Arrangers in
achieving a syndication satisfactory to you and us. Such assistance shall
include (a) your use of commercially reasonable efforts to ensure that the
Arrangers’ syndication efforts benefit from your and your affiliates’ existing
lending relationships, (b) your using commercially reasonable efforts to assist
in the preparation of one or more information packages for the Facility in form
and substance customary for transactions of this type regarding the business,
operations, financial projections and prospects of the Borrower (after giving
effect to the Transactions) (collectively, the “Confidential Information
Memorandum”), (c) your using commercially reasonable efforts to obtain, as
promptly as practicable prior to the launch of the syndication of the Facility,
a Public Debt Rating for the Borrower from each of Moody’s Investor Services,
Inc. (“Moody’s”) and Standard & Poor’s Financial Services LLC (“S&P”), in each
case giving effect to the Transactions, (d) your executing and delivering one or
more Joinder Agreements delivered to you in respect of prospective Lenders which
are selected in accordance with the provisions of this Section 3, as soon as
reasonably practicable following commencement of syndication of the Facility,
(e) the presentation of one or more customary information packages for the
Facility in format and content reasonably satisfactory to the Arrangers
(collectively, the “Lender Presentation”) in a reasonable number of meetings at
reasonable times and locations mutually agreed upon and (f) arranging for direct
contact between senior management and representatives, with appropriate
seniority and expertise, of the Borrower with prospective Lenders and
participation of such persons in a reasonable number of meetings at reasonable
times and locations mutually agreed upon. In connection with the Arrangers’
syndication efforts, you shall not be required to provide information the
disclosure of which would violate any (i) attorney-client privilege (and you
shall not be required to waive any such privilege), (ii) law, rule or regulation
applicable to the Borrower or its affiliates or (iii) obligation of
confidentiality from a third

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person is a party thereto, whether or not such Proceedings are brought by you,
your equity holders, affiliates, creditors or any other person, and to reimburse
each indemnified person upon demand for reasonable, documented and invoiced
out-of-pocket legal expenses of one primary firm of counsel, one regulatory
counsel and one special bankruptcy counsel for all such indemnified persons,
taken as a whole, and, if necessary, of a single firm of local counsel in each
appropriate jurisdiction (which may include a single firm of special counsel
acting in multiple jurisdictions) for all such indemnified persons, taken as a
whole (and, in the case of an actual or perceived conflict of interest where the
indemnified person affected by such conflict informs you of such conflict and
thereafter retains its own counsel, of another firm of counsel for such affected
indemnified person and, if necessary, of one regulatory counsel, one special
bankruptcy counsel and a single firm of local counsel in each appropriate
jurisdiction (which may include a single firm of special counsel acting in
multiple jurisdictions) for such affected indemnified person) (the foregoing,
the “Counsel Limitation”) or other reasonable, documented and invoiced
out-of-pocket expenses incurred in connection with investigating or defending
any of the foregoing; provided that the foregoing indemnity will not, as to any
indemnified person, apply to losses, claims, damages, liabilities or related
expenses to the extent they are found by a final, non-appealable judgment of a
court of competent jurisdiction to (i) have arisen or resulted from the willful
misconduct, bad faith or gross negligence of such indemnified person, (ii) have
resulted from a claim brought by you or any of your subsidiaries against such
indemnified person for material breach of such indemnified person’s obligations
hereunder or (iii) have not resulted from an act or omission by you or any of
your affiliates and have been brought by an indemnified person against any other
indemnified person (other than any claims against any Commitment Party in its
capacity or in fulfilling its role as an arranger or agent or any similar role
hereunder, except to the extent such acts or omissions are determined by a court
of competent jurisdiction by a final and non-appealable judgment to have
constituted the gross negligence, bad faith or willful misconduct of such
indemnified party in such capacity), and (b) to reimburse the Commitment Parties
and their respective affiliates on demand for all out-of-pocket expenses
(including due diligence expenses, syndication expenses, travel expenses, and
reasonable fees, charges and disbursements of counsel) incurred in connection
with the Facility and any related documentation (including this Commitment
Letter, the Fee Letter and the definitive documentation relating to the
Facility) or the administration, amendment, modification or waiver thereof. You
acknowledge that we may receive a benefit, including without limitation, a
discount, credit or other accommodation, from any of such counsel based on the
fees such counsel may receive on account of their relationship with us
including, without limitation, fees paid pursuant hereto. None of the
indemnified persons or you shall have any liability for any special, indirect,
consequential or punitive damages in connection with activities related to the
Facility or the Transactions; provided that nothing contained in this sentence
shall limit your indemnity and reimbursement obligations to the extent set forth
in this paragraph.

No indemnified person shall be liable for any damages arising from the use by
others of Information or other materials obtained through electronic,
telecommunications or other information transmission systems, including an
Platform or otherwise via the internet, and you agree, to the extent permitted
by applicable law, to not assert any claims against any indemnified person with
respect to the foregoing.

You shall not, without the prior written consent of an indemnified person (which
consent shall not be unreasonably withheld, conditioned or delayed), effect any
settlement of any pending or threatened Proceedings in respect of which
indemnity could have been sought hereunder by such indemnified person unless
such settlement (a) such settlement includes an unconditional release of such
indemnified person in form and substance reasonably satisfactory to such
indemnified person from all liability on claims that are the subject matter of
such Proceedings and (b) does not include any statement as to or any admission
of fault, culpability or a failure to act by or on behalf of any indemnified
person or any injunctive relief or other non-monetary remedy. You acknowledge
that any failure to comply with your obligations under the preceding sentence
may cause irreparable harm to the Commitment Parties and the other indemnified
persons. You shall not be liable for any settlement of any Proceeding if the
amount of such settlement

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from the rights and obligations of the parties pursuant to this Commitment
Letter, and none of such rights and obligations under such other agreements
shall be affected by any Commitment Party’s performance or lack of performance
of services hereunder. You hereby agree that each Commitment Party may render
its services under this Commitment Letter notwithstanding any actual or
potential conflict of interest presented by the foregoing, and you agree that
you will not claim any conflict of interest relating to the relationship among
such Commitment Party and you and your affiliates in connection with the
commitments and services contemplated hereby, on the one hand, and the exercise
by any Commitment Party or any of its affiliates of any of their rights and
duties under any credit agreement or other agreement (including the Funded Debt
Documents and the DIP Facility Credit Agreement) on the other hand.

In addition, please note that the Commitment Entities do not provide accounting,
tax or legal advice.

9.          Miscellaneous.

Neither this Commitment Letter nor the Fee Letter may be amended or any term or
provision hereof or thereof waived or otherwise modified except by an instrument
in writing signed by each of the parties hereto or thereto, as applicable, and
any term or provision hereof or thereof may be amended or waived only by a
written agreement executed and delivered by all parties hereto or thereto.

The provisions set forth under Sections 3, 4, 5, 7 and 8 hereof (in each case
other than any provision therein that expressly terminates upon execution of the
Facility Documentation), this Section 9 and the provisions of the Fee Letter
will remain in full force and effect regardless of whether the Facility
Documentation is executed and delivered, except that the provisions of Sections
3 and 4 shall not survive if the commitments and undertakings of the Commitment
Parties are terminated prior to the effectiveness of the Facility; provided that
(x) the foregoing provisions in this paragraph (other than with respect to the
provisions set forth in the Fee Letter and under Sections 7, 8 and this Section
9 hereof, which will remain in full force and effect notwithstanding the
expiration or termination of this Commitment Letter or the Commitment Parties’
respective commitments and agreements hereunder) shall be superseded in each
case, to the extent covered thereby, by the applicable provisions contained in
the Facility Documentation upon execution thereof and thereafter shall have no
further force and effect and (y) the provisions of Sections 3 and 4 shall
terminate on the Syndication Date (or, in the case of the second paragraph of
Section 4, the Closing Date if later).

Each of the parties hereto (for itself and its affiliates) agrees that any suit
or proceeding arising in respect of this Commitment Letter or the Commitment
Parties’ commitments or agreements hereunder or the Fee Letter will be tried
exclusively in (i) subject to clause (ii)(B), until the Effective Date (as
defined in the Plan) of the Plan, the Bankruptcy Court and (ii)(A) thereafter or
(B) if the Bankruptcy Court refuses to accept, or the Bankruptcy Court or any
appellate court from the Bankruptcy Court determines in a final, non-appealable
order that the Bankruptcy Court does not have, jurisdiction, any Federal court
of the United States of America sitting in the Borough of Manhattan or, if that
court does not have subject matter jurisdiction, in any state court located in
the City and County of New York, and each party hereby submits to the exclusive
jurisdiction of, and to venue in, such court. Any right to trial by jury with
respect to any action or proceeding arising in connection with or as a result of
either the Commitment Parties’ commitments or agreements or any matter referred
to in this Commitment Letter or the Fee Letter is hereby waived by the parties
hereto (to the fullest extent permitted by applicable law). Each of the parties
hereto (for itself and its affiliates) agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Service of any process, summons, notice or document by registered mail or
overnight courier addressed to any of the parties hereto at the addresses above
shall be effective

12

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service of process against such party for any suit, action or proceeding brought
in any such court. This Commitment Letter and the Fee Letter and any claim,
controversy or dispute arising hereunder or thereunder will be governed by and
construed in accordance with the laws of the State of New York without regard to
principles of conflicts of laws.

10.          PATRIOT Act Notification.

The Commitment Parties hereby notify the Borrower that pursuant to the
requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the “Patriot Act”) and the requirements of 31 C.F.R. §
1010.230 (the “Beneficial Ownership Regulation”) the Commitment Parties and each
Lender may be required to obtain, verify and record information that identifies
the Borrower, which information includes the name and address of the Borrower
and other information that will allow the Commitment Parties and each Lender to
identify the Borrower in accordance with the Patriot Act and the Beneficial
Ownership Regulation. This notice is given in accordance with the requirements
of the Patriot Act and is effective for the Commitment Parties and each Lender.

11.          Acceptance and Termination.

Each of the parties hereto agrees that this Commitment Letter is a binding and
enforceable agreement with respect to subject matter contained herein, including
an agreement to negotiate in good faith the Facility Documentation by the
parties hereto in a manner consistent with this Commitment Letter, it being
acknowledged and agreed that the commitments provided hereunder by the
Commitment Parties are subject to the conditions expressly set forth in Annex B
hereto.

This Commitment Letter may be executed in any number of counterparts, each of
which when executed will be an original, and all of which, when taken together,
will constitute one agreement. Delivery of an executed counterpart of a
signature page of this Commitment Letter by facsimile transmission or other
electronic transmission (e.g., “pdf” or “tif”) will be effective as delivery of
a manually executed counterpart hereof. This Commitment Letter and the Fee
Letter are the only agreements that have been entered into among the parties
hereto with respect to the Facility and set forth the entire understanding of
the parties with respect thereto and supersede any prior written or oral
agreements among the parties hereto with respect to the Facility.

The Commitment Parties’ commitments and agreements hereunder will terminate upon
the first to occur of (i) the execution and delivery of the Facility
Documentation by each of the parties thereto, (ii) the Effective Date of the
Plan without using the loans under the Facility, (iii) 11:59 p.m., New York City
time, on (A) June 30, 2020, if the Confirmation Order has not been entered prior
to such time or (B) August 29, 2020, if the Closing Date has not occurred prior
to such time, (iv)(A) the Plan or the Approval Order is amended or modified or
any condition contained therein waived, in a manner that is adverse to the
Commitment Parties in their capacities as such, in either case without the
consent of (I) prior to the date that an additional “Commitment Party” becomes
party to this Commitment Letter pursuant to a Joinder Agreement, the Commitment
Parties party hereto on the date hereof (the “Initial Commitment Parties”) and
(II) thereafter, the Administrative Agent and the Commitment Parties holding 66
2/3% of the commitments hereunder in respect of the Facility (clauses (I) and
(II), collectively, the “the “Required Commitment Parties”) (such consent not to
be unreasonably withheld, conditioned or delayed; provided that modifications to
the Plan solely as a result of an increase in roll-over, “take-back” or
reinstatement of any existing debt of the Debtors shall be deemed not to be
adverse to the Commitment Parties for the purposes of this clause (A)), (B) any
Plan Supplement or any Plan Document (each as defined in the Plan) that is
adverse to the interests of the Commitment Parties in their capacities as such
is filed or finalized without the consent of the Required Commitment Parties
(such consent not to be unreasonably withheld, conditioned or delayed), (v) the
Chapter 11 Case with respect to any Debtor is

13

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dismissed or converted to a proceeding under chapter 7 of the Bankruptcy Code,
(vi) a trustee or examiner with enlarged powers (having powers beyond those set
forth in section 1106(a)(3) and 1106(a)(4) of the Bankruptcy Code) is appointed
with respect to any of the Debtors, (vii) there is in effect an order of a
governmental authority of competent jurisdiction permanently restraining,
enjoining or otherwise prohibiting the consummation of any of the transactions
contemplated by the Plan, or any law, statute, rule, regulation or ordinance is
adopted that makes consummation of the transactions contemplated by the Plan
illegal or otherwise prohibited; (viii) the Bankruptcy Court shall not have
entered an order approving the relief requested in the motion filed with the
Bankruptcy Court authorizing the Borrower’s entry into and performance under
this Commitment Letter, the Fee Letter and any related engagement letter (the
“Approval Order”), in form and substance reasonably satisfactory to the
Commitment Parties, on or before December 20, 2019January 31, 2020; (ix) the
Debtors’ aggregate liability with respect to WildfireFire Claims (as defined in
the Plan) is determined (whether (A) by the Bankruptcy Court (or the District
Court to which the reference has been partially withdrawn for estimation
purposes), (B) pursuant to an agreement between the Debtors and the holders of
Wildfire ClaimsFire Claims that is subject to an order of the Bankruptcy Court
approving such agreement, or (C) through a combination thereof) to exceed
$18.925.5 billion (the “WildfireFire Claims Cap”); provided, however, that for
purposes of this clause (ix), (1) any Wildfire Claim that the California Public
Utilities Commission has approved or agreed to approve for recovery or pass
through by the Utility shall not count in determining the Wildfire Claims Cap
and (2) the Wildfire Claims Cap shall be increased by an amount equal to the
amount of Wildfire Claims consisting of professional fees that the Bankruptcy
Court (or the District Court to which the reference has been partially withdrawn
for estimation purposes) determines to be reasonable; (x) (A) the occurrence of
one or more wildfires within PG&E’s service area after the Petition Date (as
defined in the Plan) and prior to January 1, 2020 that is asserted by any person
to arise out of the Debtors’ activities and that destroys or damages more than
500 dwellings or commercial structures (“Structures”); provided, however, that
any notice of termination under this clause (x)(A) must be given on or before
January 15, 2020the entry of the Approval Order, or (B) the occurrence of one or
more wildfires on or after January 1, 2020 destroying or damaging at least 500
Structures within PG&E’s service area at a time when the portion of PG&E’s
system at the location of such wildfire was not successfully de-energized; (xi)
the Debtors shall not have received at least $14,00012,000 million of equity
commitments by November 7,December 24, 2019 on terms reasonably satisfactory to
the Commitment Parties, (xii) since June 30, 2019, a Material Adverse Effect
shall have occurred; (xiii) the Debtors have failed to perform any of their
obligations set forth in this Commitment Letter, which failure to perform (A)
would give rise to the failure of the condition set forth in paragraph 1(a) or
1(d) on Annex B hereto and (B) is incapable of being cured or, if capable of
being cured by June 30, 2020, the Debtors have not cured within 10 calendar days
following receipt by the Debtors of written notice of such failure to perform
from the Commitment Parties holding a majority of the commitments in respect of
the Facility, (xiv) to the extent that there is a similar termination event
under the BCLs as of the applicable date of determination, if at any time after
the first day of the Confirmation Hearing (as defined in the Plan), either (A)
asserted Administrative Expense Claims (as defined in the Plan) exceed $250
million (excluding all ordinary course Administrative Expense Claims,
Professional Fee Claims, and Disallowed Administrative Expense Claims and the
portion of an Administrative Expense Claim that is covered by insurance (in each
case, as defined in the Plan) and including for the avoidance of doubt, any such
expenses or claims with respect to the Facility) and (collectively, the
“Excluded Administrative Expense Claims”)) or (B) the Debtors have reserved for
and/or paid more than $250 million in the aggregate for Administrative Expense
Claims, excluding the Excluded Administrative Expense Claims, (xv) on or prior
to June 30, 2020, the Borrower shall not have received from the California
Public Utilities Commission (the “CPUC”) all necessary approvals, authorizations
and final orders to implement the Plan, and to participate in the Go-Forward
Wildfire Fund (as defined in the Plan), including (iA) provisions pertaining to
authorized return on equity and regulated capital structure, (iiB) a disposition
of proposals for certain potential changes to PG&E’s corporate structure and
authorizations for the Utility to operate as a utility, (iiiC) resolution of
claims for monetary fines or penalties under the California Public Utilities
Code for

14

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conduct prior to the Petition Date and (ivD) approval (or exemption from
approval) of the financing structure and the securities to be issued under the
Plan, (xvi) if at any time the Bankruptcy Court determines that the Debtors are
insolvent and (xvii) the Plan, any Plan Supplement or any Plan Document is
amended, modified or changed, in each case without the consent of the Required
Commitment Parties to include a process for transferring the license and
operating assets of the Utility to the State of California or a third party (a
“Transfer”) or PG&E effects a Transfer other than pursuant to the Plan; (the
earliest date in clauses (ii) through (xvxvii) being the “Commitment Termination
Date”); provided that the termination of any commitment pursuant to this
sentence does not prejudice your rights and remedies in respect of any breach of
this Commitment Letter. You will have the right to terminate this Commitment
Letter in the event that the Debtor’s exclusive periods to file and solicit
acceptances of a plan of reorganization are terminated or modified.

Please confirm that the foregoing is in accordance with your understanding by
signing and returning to JPMorgan an executed copy of this Commitment Letter,
together, if not previously executed and delivered, with an executed copy of the
Fee Letter, on or before 11:59 p.m., New York City time, on October 11, 2019,
whereupon this Commitment Letter and the Fee Letter will become binding
agreements between us. This offer will terminate on such date if this Commitment
Letter and the Fee Letter have not been signed and returned as described in the
preceding sentence. We look forward to working with you on this transaction.

[Remainder of page intentionally left blank]

15

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Schedule I

Titles

Commitment Party (or its designated affiliate)
 
Title(s)
BNP Paribas
 
Joint Lead Arranger and Co-
Documentation Agent
Credit Suisse AG, Cayman Islands Branch
 
Joint Lead Arranger and Co-
Documentation Agent
Morgan Stanley Bank, N.A.
 
Joint Lead Arranger and Co-
Documentation Agent
MUFG Union Bank, N.A.
 
Joint Lead Arranger and Co-
Documentation Agent
Wells Fargo Bank, National Association
 
Joint Lead Arranger and Co-
Documentation Agent
Mizuho Bank, Ltd.
 
Joint Lead Arranger and Co-
Documentation Agent

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Schedule II

Commitments

 
Commitment Party
 
 
Commitment
 
JPMorgan Chase Bank, N.A.
 
 
$4,582,972,973.00
 
Bank of America, N.A.
 
 
$4,582,972,972.98
 
Barclays Bank PLC
 
$4,582,972,972.98
 
Citi
 
 
$4,582,972,972.98
 
Goldman Sachs Lending Partners LLC
 
 
$2,132,972,972.98
 
Goldman Sachs Bank USA
 
 
$2,450,000,000.00
 
BNP Paribas
 
 
$739,189,189.18
 
Credit Suisse AG, Cayman Islands Branch
 
 
$739,189,189.18
 
Morgan Stanley Bank, N.A.
 
 
$739,189,189.18
 
MUFG Union Bank, N.A.
 
 
$739,189,189.18
 
Wells Fargo Bank, National Association
 
 
$739,189,189.18
 

--------------------------------------------------------------------------------

Mizuho Bank, Ltd.
 
 
$739,189,189.18
 
Total:
 
 
$27,350,000,000.00
 
 

--------------------------------------------------------------------------------

A-3

 
any Qualifying Bank Financing of PG&E;
     
provided, however, that until such time as the Backstop Commitments (as defined
in those certain Chapter 11 Plan Backstop Commitment Letters (the “BCLs”), as in
effect on the date hereofDecember 20, 2019) have been reduced to $0, except as
contemplated by the proviso to the Excluded Debt definition below, the
commitments in respect of the Facility shall not be reduced by any cash proceeds
from any Additional Capital Source (as defined in the BCLs, as in effect on the
date hereofDecember 20, 2019) to the extent that such cash proceeds also reduce
the Backstop Commitments.
     
Mandatory prepayments or reductions under clause (a) and (b) above, or the
proviso to the Excluded Debt definition below, may be applied, at the option of
the Borrower, either to prepay loans or reduce commitments under the Facility
and that certain senior unsecured bridge facility of PG&E described in the
commitment letter dated as of the date hereof among PG&E, the Borrower, JPMorgan
and the other “Commitment Parties” party thereto (such facility, the “PG&E
Facility”), provided that (i) the Borrower may not prepay loans or reduce
commitments under the Facility without prepaying or reducing the PG&E Facility
on a pro rata basis and (ii) Net Cash Proceeds of any Notes issued by the
Borrower shall be applied to prepay loans or reduce commitments under the
Facility before being applied to prepay or reduce the PG&E Facility. The
application of Net Cash Proceeds received by the Utility to prepay or reduce the
PG&E Facility shall be subject to requisite regulatory approvals (and such Net
Cash Proceeds shall be applied to prepay or reduce the Facility to the extent
not permitted to be applied to prepay or reduce the PG&E Facility). For the
avoidance of doubt, each dollar from a mandatory prepayment or reduction event
described under this heading shall be applied to reduce either (but not both) of
the commitments under the Facility or the commitments under the PG&E Facility,
or to prepay either (but not both) the loans under the Facility or the loans
under the PG&E Facility, in each case in accordance with the terms described
under this heading.
     
Furthermore, the obligations of the Commitment Parties to fund on the Closing
Date in respect of the Facility under the Commitment Letter or under the
Facility Documentation (as applicable) shall be automatically and permanently
reduced, without penalty or premium and on a dollar-for-dollar basis, by
(without duplication of any of the clauses above) the aggregate principal amount
of any roll-over, “take-back” or reinstated debt (the “Surviving Debt”) of the
Borrower or its subsidiaries.
     
“Net Cash Proceeds” shall mean:
     
(a) with respect to a sale or other disposition of any assets of the Borrower,
PG&E or any of their respective subsidiaries, the excess,

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A-5

 
up to an aggregate amount not to exceed the amount of the revolving commitments
in effect thereunder on the date of the Commitment Letter, (v) incremental
facilities under the DIP Facility Credit Agreement (or refinancings thereof) or
any new debtor-in-possession facilities, in either case that are to be paid in
full in cash at emergence from the Chapter 11 Cases, (vi) securitization
securities or facilities contemplated by the Plan,, and (vii) issuances of debt
by PG&E in a principal amount not to exceed $7,000 million and debt or unfunded
commitments under a revolving credit facility to be entered into by PG&E in an
amount not to exceed $500 million, in each case as contemplated by the Plan;
provided that, notwithstanding the foregoing, if (A) the aggregate principal
amount of Specified Debt issued or incurred by the Borrower or its subsidiaries
plus the aggregate principal amount of Excluded Debt issued or incurred by the
Borrower or its subsidiaries pursuant to clause (iv), (v) or (vi) plus the
principal amount of Surviving Debt of the Borrower or its subsidiaries exceeds
$30,000 million, or (B) the aggregate principal amount of Specified Debt issued
or incurred by PG&E plus the aggregate principal amount of Excluded Debt issued
or incurred by PG&E pursuant to clause (vi) or (vii) plus the principal amount
of Surviving Debt of PG&E exceeds $7,000 million, then in either case the
commitments with respect to the Facility shall be reduced, or the loans under
the Facility shall be prepaid, by an equivalent amount (for the avoidance of
doubt, until such commitments or the aggregate principal amount of such loans,
in either case, equal zero).
 
     
“Excluded Equity Offerings” shall mean (i) issuances pursuant to employee
compensation plans, employee benefit plans, employee based incentive plans or
arrangements, employee stock purchase plans, dividend reinvestment plans and
retirement plans or issued as compensation to officers and/or non-employee
directors or upon conversion or exercise of outstanding options or other equity
awards, (ii) issuances of directors’ qualifying shares and/or other nominal
amounts required to be held by persons other than PG&E, the Borrower and their
respective subsidiaries under applicable law, (iii) issuances to or by the
Borrower or any subsidiary of the Borrower to PG&E, the Borrower or any other
subsidiary of the Borrower (including in connection with existing joint venture
arrangements), (iv) any equity issued pursuant to the Plan in an aggregate
amount not to exceed $14,00012,000 million and (v) additional exceptions to be
agreed.
     
“Qualifying Bank Financing” shall mean a committed but unfunded bank or other
credit facility for the incurrence of debt for borrowed money by PG&E or the
Borrower that has become effective for the purposes of financing the
Transactions (excluding, for the avoidance of doubt, the Facility), subject to
conditions to funding that are, in the written determination of the Borrower, no
less favorable to the Borrower than the conditions to the funding of

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A-6

 
the Facility set forth herein.
 
In addition, with respect to any Included Securitization Transaction, (x) if the
proceeds of such Included Securitization Transaction are received, or
commitments with respect thereto are entered into, on or prior to the Closing
Date, such proceeds or committed amounts shall be applied as set forth under
“Closing Date Securitization Waterfall” below and (y) if the proceeds of such
Included Securitization Transaction are received after the Closing Date, then,
without duplication of any reduction pursuant to clause (x) above, such proceeds
shall be applied to prepay the PG&E Facility to the maximum extent permitted by
applicable law and regulatory approvals and thereafter shall be applied to
prepay the Facility.
 
“Included Securitization Transaction” shall mean any securitization transaction
of PG&E, the Borrower or its Subsidiaries other than any non-recourse
pass-through securitization transaction contemplated by A.B. 1054, 2019 Assemb.
(Cal. 2019) (for the avoidance of doubt, non-recourse pass-through
securitization transactions shall not include any securitization all or a
portion of which is, directly or indirectly, credited, rebated or otherwise paid
to customers).
 
“Fire Victim Trust Securitization” shall mean a tax benefits securitization all
or a portion of the proceeds of which will be utilized to finance the Fire
Victim Trust contemplated by (and as defined in) the Plan.

 
In addition, the aggregate commitments in respect of the Facility shall be
permanently reduced to zero on the Commitment Termination Date.
 
The Borrower shall provide the Administrative Agent with prompt written notice
of any mandatory prepayment or commitment reduction being required hereunder.
 
Amounts borrowed under the Facility that are repaid or prepaid may not be
reborrowed.
Closing Date Securitization Waterfall:
 
On or prior to the Closing Date, the proceeds of all Included Securitization
Transactions shall be applied as follows (the “Closing Date Securitization
Waterfall”):
 
First, to the extent constituting proceeds of a Fire Victim Trust
Securitization, to finance the Fire Victim Trust as contemplated by the Plan, up
to $1,350 million;

Second, to reduce commitments under the PG&E Facility on a dollar-for-dollar
basis in accordance with the Mandatory Prepayments and Commitment Reductions
section above, up to $2,000 million;

--------------------------------------------------------------------------------

A-7

 
Third, to be deposited as cash on the balance sheet of PG&E, the Borrower or its
Subsidiaries on the Closing Date, up to $650 million;

Fourth, at the Borrower’s election, in lieu of (and to reduce) the minimum
equity requirement (and the intended use of proceeds thereof) as specified in
clause 14 of Annex B, up to $4,000 million;
 
Thereafter, as the Borrower shall direct (but, for the avoidance of doubt, with
no further reduction to the minimum equity requirement, as specified in clause
14 of Annex B).
Voluntary Prepayments and
Reductions in Commitments:
 
Prepayments of borrowings under the Facility will be permitted at any time, in
whole or in part and in minimum principal amounts to be agreed upon, without
premium or penalty, subject to reimbursement of the Lenders’ redeployment costs
in the case of a prepayment of Adjusted LIBOR borrowings other than on the last
day of the relevant interest period. The Borrower may voluntarily reduce
unutilized portions of the commitments under the Facility at any time without
penalty.
 
Amounts borrowed under the Facility that are repaid or prepaid may not be
reborrowed.
Documentation:
 
The making of the loans under the Facility will be governed by definitive loan
and related agreements and documentation (collectively, the “Facility
Documentation” and the principles set forth in this paragraph, the
“Documentation Principles”) to be negotiated in good faith, which will be based
on the Borrower’s Second Amended and Restated Credit Agreement, dated as of
April 27, 2015, among the Borrower, the financial institutions from time to time
party thereto and Citibank, N.A., as administrative agent (as amended from time
to time prior to the date hereof, the “Pre-Petition Credit Agreement”). The
Facility Documentation will contain only those representations and warranties,
affirmative and negative covenants, mandatory prepayments and commitment
reductions, and events of default expressly set forth in the Commitment Letter
(including this Annex A). The Facility Documentation shall include modifications
to the Pre-Petition Credit Agreement (a) as are necessary to reflect the terms
set forth in the Commitment Letter (including this Annex A) and the Fee Letter,
(b) to reflect any changes in law or accounting standards since the date of the
Pre-Petition Credit Agreement, (c) to reflect the operational or administrative
requirements of the Administrative Agent and operational requirements of the
Borrower and its subsidiaries, (d) to reflect the nature of the Facility as a
bridge facility, (e) to reflect the Borrower’s pro forma capital structure, (f)
to reflect certain provisions in the DIP Facility Credit Agreement to be agreed
and (g)
 

--------------------------------------------------------------------------------

ANNEX A-1

Interest Rates:
The interest rates under the Facility will be, at the option of the Borrower,
(a) Adjusted LIBO Rate plus the Applicable Adjusted LIBO Rate Margin (each as
defined below) or (b) ABR (as defined below) plus the Applicable Adjusted LIBO
Rate Margin minus 1.00% (but in any event not less than 0.00%).
     
The Borrower may elect interest periods of 1, 2, 3 or 6 months for Adjusted LIBO
Rate borrowings. Calculation of interest shall be on the basis of the actual
number of days elapsed in a year of 360 days (or 365 or 366 days, as the case
may be, in the case of ABR loans based on the prime rate) and interest shall be
paid in arrears (i) at the end of each interest period and no less frequently
than quarterly, in the case of Adjusted LIBO Rate advances, and (ii) quarterly,
in the case of ABR advances.
     
“ABR” is the Alternate Base Rate, which is the greatest of (i) the Prime Rate,
(ii) the NYFRB Rate from time to time plus 0.5% and (iii) the Adjusted LIBO Rate
for a one month interest period on the applicable date plus 1%.
 
     
“Adjusted LIBO Rate” means the LIBO Rate, as adjusted for statutory reserve
requirements for eurocurrency liabilities.
 
 
“Interpolated Rate” means, at any time, for any interest period, the rate per
annum (rounded to the same number of decimal places as the LIBO Screen Rate)
determined by the Administrative Agent (which determination shall be conclusive
and binding absent manifest error) to be equal to the rate that results from
interpolating on a linear basis between: (a) the LIBO Screen Rate for the
longest period (for which the LIBO Screen Rate is available for the applicable
currency) that is shorter than the Impacted Interest Period; and (b) the LIBO
Screen Rate for the shortest period (for which that LIBO Screen Rate is
available for the applicable currency)) that exceeds the Impacted Interest
Period, in each case, at such time; provided that if any Interpolated Rate as so
determined would be less than zero, such rate shall be deemed to be zero for the
purposes of the Facility Documentation.
     
“LIBO Rate” means, with respect to any EurocurrencyEurodollar borrowing for any
applicable currency and for any interest period, the LIBO Screen Rate at
approximately 11:00 a.m., London time, two business days prior to the
commencement of such interest period; provided that if the LIBO Screen Rate
shall not be available at such time for such interest period (an “Impacted
Interest Period”) with respect to the

--------------------------------------------------------------------------------

B-1-2

 
applicable currency then the LIBO Rate shall be the Interpolated Rate.
     
“LIBO Screen Rate” means, for any day and time, with respect to any
EurocurrencyEurodollar borrowing for any applicable currency and for any
interest period, the London interbank offered rate as administered by ICE
Benchmark Administration (or any other Person that takes over the administration
of such rate) for the relevant currency for a period equal in length to such
interest period as displayed on such day and time on pages LIBOR01 or LIBOR02 of
the Reuters screen that displays such rate (or, in the event such rate does not
appear on a Reuters page or screen, on any successor or substitute page on such
screen that displays such rate, or on the appropriate page of such other
information service that publishes such rate from time to time as selected by
the Administrative Agent in its reasonable discretion); provided that if the
LIBO Screen Rate as so determined would be less than zero, such rate shall be
deemed to zero for the purposes of calculating such rate.
     
“NYFRB” means the Federal Reserve Bank of New York.
     
“NYFRB Rate” means, for any day, the greater of (i) the Federal Funds Effective
Rate in effect on such day and (ii) the Overnight Bank Funding Rate in effect on
such day (or for any day that is not a business day, for the immediately
preceding business day); provided that if none of such rates are published for
any day that is a business day, the term “NYFRB Rate” means the rate quoted for
such day for a federal funds transaction at 11:00 a.m., New York City time, on
such day received by the Administrative Agent from a federal funds broker of
recognized standing selected by it; provided, further, that if any of the
aforesaid rates as so determined would be less than zero, such rate shall be
deemed to be zero for purposes of the Facility Documentation.
     
“Overnight Bank Funding Rate” means, for any day, the rate comprised of both
overnight federal funds and overnight eurodollar borrowings by U.S.-managed
banking offices of depository institutions, as such composite rate shall be
determined by the NYFRB as set forth on its public website from time to time,
and published on the next succeeding business day by the NYFRB as an overnight
bank funding rate.
     
“Prime Rate” means the rate of interest last quoted by The Wall Street Journal
as the “Prime Rate” in the U.S.

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ANNEX B

$27,350 Million Senior Secured 364-Day Facility
Conditions3

The borrowing under the Facility shall be subject to the satisfaction or waiver
by the Commitment Parties of the following conditions:

1.          (a) The Bankruptcy Court shall have entered (x) the Approval Order
and (y) a confirmation order confirming the Plan with respect to the Debtors in
form and substance reasonably satisfactory to the Required Commitment Parties
(the “Confirmation Order”) by no later than June 30, 2020, each of which shall
(i) not be stayed, (ii) be in full force and effect, (iii) be final and
non-appealable, and (iv) not have been reversed, vacated, amended, supplemented,
or otherwise modified in a manner adverse to the interests of the Commitment
Parties without the consent of the Required Commitment Parties (such consent not
to be unreasonably withheld, conditioned or delayed; provided modifications to
the Plan solely as a result of an increase in roll-over, “take-back” or
reinstatement of any existing debt of the Debtors shall be deemed not to be
adverse to the Commitment Parties for the purposes of this clause (iv)), (b)
none of the Plan, the Confirmation Order or the Approval Order shall have been
amended or modified or any condition contained therein waived, in either case
without the consent of the Required Commitment Parties (such consent not to be
unreasonably withheld, conditioned or delayed), (c) the Plan shall have become
effective in accordance with its terms no later than 60 days after the entry of
the Confirmation Order, and all conditions precedent to the effectiveness of the
Plan shall have been, or substantially contemporaneously with the closing under
the Facility, will be, satisfied or waived (to the extent adverse to their
interests, with the prior consent of the Required Commitment Parties (such
consent not to be unreasonably withheld, conditioned or delayed)), (d) the
transactions as described and defined in the Plan to occur upon the Effective
Date of the Plan shall have been consummated, or substantially concurrently with
the closing of the Facility will be consummated, on the Closing Date, (e) the
Debtors shall be in compliance in all material respects with the Confirmation
Order and (f) all documents necessary to implement the Plan and the financings
and distributions contemplated thereunder shall have been executed (each, to the
extent of which shall either (x) not be adverse to theirthe interests, of the
Commitment Parties or (y) be in form and substance reasonably acceptable to the
Required Commitment Parties).

2.          (x) The Arrangers shall have received (a) U.S. GAAP audited
consolidated balance sheets and related consolidated statements of income and
comprehensive income, of shareholders’ equity and of cash flows of the Borrower
and its subsidiaries for the three most recent fiscal years ended at least 60
days prior to the Closing Date and (b) U.S. GAAP unaudited consolidated balance
sheets and related consolidated statements of income and comprehensive income,
of shareholders’ equity and of cash flows of the Borrower and its subsidiaries
for each subsequent fiscal quarter ended at least 40 days before the Closing
Date (other than the last fiscal quarter of any fiscal year); provided that in
each case the financial statements required to be delivered by this paragraph
2(x) shall meet the requirements of Regulation S-X under the Securities Act, and
all other accounting rules and regulations of the SEC promulgated thereunder
applicable to a registration statement on Form S-1, in all material respects.
The Arrangers hereby acknowledgesacknowledge receipt of the financial statements
of the Utility in the foregoing clause (a) for the fiscal years ended December
31, 2018, December 31, 2017 and December 31, 2016, and in the foregoing clause
(b) for the fiscal quarters ended June 30, 2019 and March 31, 2019. The
Borrower’s filing of any required audited financial statements with respect to
the Borrower on Form 10-K or required unaudited financial statements with
respect to the Borrower on Form 10-Q, in each case, will satisfy the
requirements under clauses (a) or (b), as applicable, of this paragraph.

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3 All capitalized terms used but not defined herein have the meanings given to
them in the Commitment Letter to which this Annex B is attached, including Annex
A thereto.

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B-3

respect to any real property that constitutes Collateral, the Commitment Parties
shall be satisfied that flood insurance due diligence and flood insurance
compliance has been completed.

10.          The Borrower shall have received investment grade senior secured
debt ratings of (i) in the case of Moody’s, Baa3 or better and (ii) in the case
of S&P, BBB- or better and in each case, with a stable or better outlook.

11.          Total PG&E weighted average earning rate base (including electric
generation, electric transmission, electric distribution, gas distribution, gas
transmission and storage) for estimated 2021 as approved by the California
Public Utilities Commission (the “CPUC”) shall be no less than 95% of $48
billion.

12.          Since June 30, 2019, no result, occurrence, fact, change, event,
effect, violation, penalty, inaccuracy or circumstance (whether or not
constituting a breach of a representation, warranty or covenant set forth in the
Plan) that, individually or in the aggregate with any such other results,
occurrences, facts, changes, events, effects, violations, penalties,
inaccuracies, or circumstances, (i) would have or would reasonably be expected
to have a material adverse effect on the business, operations, assets,
liabilities, capitalization, financial performance, financial condition or
results of operations, in each case, of the Debtors, taken as a whole, or (ii)
would reasonably be expected to prevent or materially delay the ability of the
Debtors to consummate the transactions contemplated by this Commitment Letter or
the Plan or perform their obligations hereunder or thereunder, including their
obligations under the Facility or the PG&E Facility (each a “Material Adverse
Effect”) shall have occurred; provided, however, that none of the following
results, occurrences, facts, changes, events, effects, violations, penalties,
inaccuracies or circumstances shall constitute or be taken into account in
determining whether a Material Adverse Effect has occurred, is continuing or
would reasonably be expected to occur: (A) the filing of the Chapter 11 Cases,
and the fact that the Debtors are operating in bankruptcy, (B) results,
occurrences, facts, changes, events, violations, inaccuracies or circumstances
affecting (1) the electric or gas utility businesses in the United States
generally or (2) the economy, credit, financial, capital or commodity markets,
in the United States or elsewhere in the world, including changes in interest
rates, monetary policy or inflation, (C) changes or prospective changes in law
(other than any law or regulation of California or the United States that is
applicable to any electrical utility) or in GAAP or accounting standards, or any
changes or prospective changes in the interpretation or enforcement of any of
the foregoing, (D) any decline in the market price, or change in trading volume,
of any securities of the Debtors, (E) any failure to meet any internal or public
projections, forecasts, guidance, estimates, milestones, credit ratings, budgets
or internal or published financial or operating predictions of revenue,
earnings, cash flow or cash position, (F) any wildfire occurring after the
Petition Date and prior to January 1, 2020, and (G) one or more wildfires,
occurring on or after January 1, 2020, that destroys or damages fewer than 500
Structures in the aggregate (it being understood that (I) the exceptions in
clauses (D) and (E) shall not prevent or otherwise affect a determination that
the underlying cause of any such change, decline or failure referred to therein
is a Material Adverse Effect, and (II) a Material Adverse Effect shall include
the occurrence of one or more wildfires on or after January 1, 2020 destroying
or damaging at least 500 Structures within PG&E’s service area at a time when
the portion of PG&E’s system at the location of such wildfire was not
successfully de-energized.

13.          The Debtors’ aggregate liability with respect to WildfireFire
Claims shall be determined (whether (i) by the Bankruptcy Court (or the District
Court to which the reference has been partially withdrawn for estimation
purposes), (ii) pursuant to an agreement between the Debtors and the holders of
WildfireFire Claims, or (iii) through a combination thereof) not to exceed the
Wildfire Claims Cap; provided, however, that for purposes of this paragraph 13,
(A) any Wildfire Claim that the CPUC has approved or agreed to approve for
recovery or pass through by the Utility shall not count in determining the
Wildfire Claims Cap and (B) the Wildfire Claims Cap shall be increased by an
amount equal to the

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B-4

amount of Wildfire Claims consisting of professional fees that the Bankruptcy
Court (or the District Court to which the reference has been partially withdrawn
for estimation purposes) determines to be reasonable.Fire Claims Cap.

14.          PG&E shall have received at least $14,00012,000 million of proceeds
from the issuance of equity, on terms acceptable to each Commitment Party in its
sole discretion, provided that (i) up to $2,000 million of such proceeds shall
be permitted to come from the proceeds of preferred equity, or equity-linked
securities or securitizations issued by PG&E or the Utility, so long as such
issuance could not reasonably be expected to negatively impact cash
distributions to PG&E or distributions that will be available to service debt at
PG&E. and (ii) such amount may be reduced by up to $4,000 million from the
proceeds of any Included Securitization Transaction on terms reasonably
satisfactory to the Commitment Parties subject to compliance with the Closing
Date Securitization Waterfall set forth in Annex A. The economic benefit of the
net operating loss carryforwards and other tax attributes of PG&E, the Borrower
or its subsidiaries shall not have been transferred (pursuant to a tax
monetization transaction or otherwise) except on terms that could not reasonably
be expected to negatively impact the cash flows of PG&E, the Borrower or its
subsidiaries as determined by the Arrangers in their sole discretion.

15.          The Utility has both (i) elected, and received Bankruptcy Court
approval, to participate in the Go-Forward Wildfire Fund (as defined in the
Plan) and (ii) satisfied the other conditions to participation in the Go-Forward
Wildfire Fund set forth in the Wildfire Legislation (as defined in the Plan).

16.          PG&E shall own directly 100% of the common stock of the Borrower.

17.          No order of a governmental authority of competent jurisdiction
restraining, enjoining or otherwise prohibiting the consummation or funding of
any transactions contemplated by the Plan shall have been received by the
Debtors, and no law, statute, rule, regulation or ordinance shall have been
adopted that makes the consummation or funding of any transactions contemplated
by the Plan illegal or otherwise prohibited. The Borrower shall have delivered
to the Arrangers a financial model satisfactory to the Arrangers reflecting
sources and uses and capital structure, together with a certification by the
Borrower that such financial model demonstrates compliance with all regulatory
requirements (including all CPUC approvals).

18.          One or more investment banks reasonably satisfactory to the
Commitment Parties shall have been engaged to publicly sell or privately place
the Notes for the purpose of reducing, replacing or refinancing the Facility.