Execution Version

THIS AGREEMENT IS NOT, AND SHALL NOT BE DEEMED, A SOLICITATION

FOR CONSENTS TO ANY CHAPTER 11 PLAN OF REORGANIZATION

PURSUANT TO SECTIONS 1125 AND 1126 OF THE BANKRUPTCY CODE OR A

SOLICITATION TO TENDER OR EXCHANGE ANY CLAIMS OR INTERESTS.

EACH CONSENTING CREDITOR’S VOTE ON THE PLAN SHALL NOT BE

SOLICITED UNLESS AND UNTIL SUCH CONSENTING CREDITOR HAS

RECEIVED A DISCLOSURE STATEMENT AND RELATED BALLOT(S), AS

APPROVED BY THE BANKRUPTCY COURT.

SECOND AMENDED AND RESTATED RESTRUCTURING SUPPORT AGREEMENT

This Second Amended and Restated Restructuring Support Agreement (as

amended, supplemented, or otherwise modified from time to time in accordance with the terms

hereof, this “Agreement”) dated as of November 1[●], 2019, is entered into by and among the

following parties: (i) PG&E Corporation and Pacific Gas and Electric Company, as debtors and

debtors in possession (each, a “Debtor” and collectively, the “Company” or the “Debtors”) in the

Chapter 11 Cases (as defined below), and (ii) each of the undersigned creditors party hereto from

time to time solely in each such creditor’s capacity as a holder of Subrogation Claims (as defined

below) (including Transferees and Joining Parties (each as defined below), collectively the

“Consenting Creditors”), and this Agreement shall not be binding on any such holder in its

capacity as the holder of any claim or interest other than a Subrogation Claim. The Company and

the Consenting Creditors are referred to herein as the “Parties” and each individually as a “Party.”

RECITALS:

WHEREAS, on January 29, 2019, (the “Petition Date”), the Debtors commenced

voluntary cases (the “Chapter 11 Cases”) under chapter 11 of title 11 of the United States Code

(the “Bankruptcy Code”) in the United States Bankruptcy Court for the Northern District of

California (the “Bankruptcy Court”), which Chapter 11 Cases have been consolidated by order of

the Bankruptcy Court for procedural purposes only and are being jointly administered under case

number 19-30088 (DM);

WHEREAS, as of the date hereof, the Consenting Creditors have asserted certain

Subrogation Claims against the Company;

WHEREAS, before the date hereof, the Parties and their representatives have

engaged in arms’ length, good-faith negotiations regarding a settlement of the Subrogation Claims

against the Company on the terms set forth herein, including the allowance of Subrogation Claims

at the Allowed Subrogation Claim Amount (each as defined below), which allowance will survive

termination of this Agreement in certain circumstances, as expressly set forth herein, and the

treatment of the Subrogation Claims with the Aggregate Subrogation Recovery (as defined

below) on the Effective Date of the Plan (each as defined below) (the “Settlement”);

WHEREAS, the Parties have agreed to take certain actions in support of the

Settlement on the terms and conditions set forth in this Agreement; and

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 1

of 33
32188712.10

WHEREAS, the Parties desire to express to each other their mutual support and

commitment with respect to the Settlement, the Plan, and the other matters discussed hereunder.

NOW, THEREFORE, in consideration of the promises and the mutual covenants

and agreements set forth herein, and for other good and valuable consideration, the receipt and

sufficiency of which are hereby acknowledged, and incorporating and affirming the accuracy of

the Recitals stated above, the Parties, intending to be legally bound, agree as follows:

1. DEFINITIONS; RULES OF CONSTRUCTION.

(a) Definitions. The following terms shall have the following definitions:

“A.B. 1054” means California Assembly Bill No. 1054, approved by the Governor

on July 12, 2019.

“Ad Hoc Subrogation Group” means that certain ad hoc group of holders of

Subrogation Claims, each in their capacities as such, represented by Willkie Farr & Gallagher

LLP, Diemer & Wei LLP and Rothschild & Co US Inc., the members of which are disclosed in

that certain Verified Statement of the Ad Hoc Group of Subrogation Claim Holders Pursuant to

Bankruptcy Rule 2019 [Dkt. No. 971] as such statement may be amended from time to time.

“Ad Hoc Professionals” means (i) Willkie Farr & Gallagher LLP, (ii) Rothschild &

Co. US Inc., (iii) Diemer & Wei LLP, (iv) Kekst and Company Incorporated d/b/a Kekst CNC,

and (v) Wilson Public Affairs.

“Agreement” has the meaning set forth in the preamble hereof.

“Aggregate Subrogation Recovery” means the payment of $11 billion in full in

cash (subject to replacing a portion of the cash with Non-Cash Recovery in accordance with

Section 3(a)(ix) hereof) to a trust to be established pursuant to the Plan for the benefit of holders

of Subrogation Claims.

“Allowance Termination Notice” has the meaning set forth in Section 5(d) hereof.

“Allowed Subrogation Claim Amount” has the meaning set forth in in Section 4

hereof.

“Alternative Restructuring” has the meaning set forth in Section 2(a)(iii).

“Bankruptcy Code” has the meaning set forth in the recitals hereof.

“Bankruptcy Court” has the meaning set forth in the recitals hereof.

“Bankruptcy Rules” means the Federal Rules of Bankruptcy Procedure as

promulgated by the United States Supreme Court under section 2075 of title 28 of the United

States Code, applicable to the Chapter 11 Cases, and any Local Rules of the Bankruptcy Court.

- 2 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 2

of 33
32188712.10

“Business Day” means any day other than Saturday, Sunday, and any day that is a

legal holiday or a day on which banking institutions in New York, New York are authorized by

law or other governmental action to close.

“Chapter 11 Cases” has the meaning set forth in the recitals hereof.

“Claim” has the meaning ascribed to such term under section 101(5) of the

Bankruptcy Code.

“Company” has the meaning set forth in the preamble hereof.

“Confidential Claims Information” has the meaning set forth in Section 3(a)(vii)

hereof.

“Confirmation Order” means an order entered by the Bankruptcy Court confirming

the Plan.

“Consenting Creditors” has the meaning set forth in the preamble hereof.

“Creditor Insolvency Termination” has the meaning set forth in Section 5(c)

hereof.

 “Creditor Termination Event” has the meaning set forth in Section 5(d) hereof.

“Debtor Termination Event” has the meaning set forth in Section 5(e) hereof.

“Debtor Insolvency Termination” has the meaning set forth in Section 5(c)

hereof.

“Debtors” has the meaning set forth in the preamble hereof.

“Definitive Documents” means (i) the Plan and the Confirmation Order, (ii) the

Disclosure Statement and the Disclosure Statement Order, (iii) the Plan Supplement, (iv) the RSA

Approval Order, (v) any motions or pleadings filed by the Debtors in the Chapter 11 Cases

seeking approval or confirmation of the foregoing, and (vi) any exhibits, appendices, or schedules

contemplated by the foregoing clause (i) – (v).

“Disclosure Statement” means the Debtors’ disclosure statement, including any

exhibits, appendices, or ballots attached thereto or contemplated thereby, and any procedures

related to the solicitation of votes to accept or reject the Plan, in each case, as amended,

supplemented, or otherwise modified from time to time in accordance with the terms hereof.

“Disclosure Statement Order” means an order entered by the Bankruptcy Court

approving the Disclosure Statement and related solicitation materials, including with respect to

Section 2(a)(ii) hereof.

“Effective Date” means the effective date of the Plan or an Insolvent Plan.

- 3 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 3

of 33
32188712.10

“Estimation Proceedings” means any court proceedings related to the estimation or

allowance of IP Claims (in the aggregate) (whether in the Bankruptcy Court, California state

court, Federal District Court or any other forum, including any state court proceedings related to

the Tubbs Fire), including the pending wildfire claims estimation proceeding before the Hon.

James Donato in the Northern District of California, Case No. 19-cv-05257-JD, and the pending

coordination proceeding in the Superior Court of the State of California for the County of San

Francisco before the Hon. Teri L. Jackson, the California North Bay Fire Cases JCCP 4955.

“Findings and Orders” has the meaning set forth in Section 3(a)(v) hereof.

“Insolvency TerminationDetermination” has the meaning set forth in Section

5(c) hereof.

“Insolvent Plan” has the meaning set forth in Section 3(a)(i) hereof.

“IP Claims” means any Wildfire Claim that is not a Public Entities Wildfire Claim,

a Subrogation Claim or any Wildfire Claim asserted by any Governmental Unit (as defined in

section 101(27) of the Bankruptcy Code).

“Joinder” has the meaning set forth in Section 26 hereof.

“Joining Party” has the meaning set forth in Section 26 hereof.

“Non-Cash Recovery” has the meaning set forth in Section 3(a)(ix) hereof.

“Paid Claims” as such term is used herein, means payments and legally recoverable

expenses made to or on behalf of insureds in connection with the Wildfires and the insuring

agreement between a holder of Subrogation Claims (or an insurer from whom such holder directly

or indirectly acquired Subrogation Claims) and its insured, but not including payments of any

personal injury or death claims, non-recoverable expenses (including deductibles voluntarily

refunded), damages unrelated to the Wildfires and/or arising from the insurer’s negligence or bad

faith. For the avoidance of doubt, Paid Claims shall also include payments and recoverable

expenses made by a Claimholder to or for the benefit of insureds in connection with Wildfires

required by California law as a result of an insurer’s insolvency.

“Parties” has the meaning set forth in the preamble hereof.

“Person” has the meaning ascribed to such term under section 101(41) of the

Bankruptcy Code.

“Petition Date” has the meaning set forth in the recitals hereof.

“Plan” means the Debtors’ joint chapter 11 plan of reorganization, as such may be

amended, supplemented, or modified from time to time in accordance with Section 9 hereof. The

draft of the Plan attached hereto as Exhibit A incorporates the terms of the Settlement and

otherwise does not adversely affect the Settlement or the rights of the Parties hereto. The

Debtors shall file the Plan with the Bankruptcy Court in the form attached no later than November

- 4 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 4

of 33
32188712.10

4, 2019, which Plan, date, or deadline may be amended, modified, or extended by agreement of

the Parties pursuant to Section 9 herein. For the avoidance of doubt, the Plan and the applicable

Definitive Documents shall incorporate the terms of the Settlement including any conditions

thereto, and shall not otherwise adversely affect the Settlement, or the rights of the Parties to this

Agreement. For the further avoidance of doubt, references to the Plan herein shall not include an

Insolvent Plan.

“Plan Supplement” means the supplement to the Plan to be filed in the Chapter 11

Cases, that includes forms of certain documents effectuating the transaction contemplated in the

Plan and shall be filed with the Bankruptcy Court no later than fourteen (14) days prior to the

deadline set to file objections to the confirmation of the Plan.

“Public Entities Wildfire Claim” means any Wildfire Claim against the Debtors held

by any of the Public Entities (as defined in the Plan), including any Claim pleaded or asserted or

that could have been pleaded or asserted by the Public Entities based on the factual allegations set

forth in the Public Entities Operative Complaints (as defined in the Plan) or that were filed or

could be filed by the Public Entities in connection with the Chapter 11 Cases whether arising

under California law or any other applicable law of the United States (state or federal) or any

other jurisdiction, in each case whether such claims are absolute or contingent, direct or indirect,

known or unknown, foreseen or unforeseen, in contract, tort or in equity, under any theory of

law.

“Requisite Consenting Creditors” means, as of any time of determination,

Consenting Creditors holding at least 66 2/3% of RSA Claims (measured by dollar amount).

“Reserved Claims” means projected payments relating to Subrogation Claims

reserved but not paid, as of the date of measurement.

“RSA Approval Order” means the order, in form and substance reasonably

acceptable to the Debtors and the Requisite Consenting Creditors, approving the Debtors’ entry

into this Agreement, which shall (i) be entered by the Bankruptcy Court no later than the RSA

Deadline, and (ii) allow the Subrogation Claims in the aggregate allowed amount of $11 billion

pursuant to Bankruptcy Rule 9019 as provided herein.

“RSA Claims” means Subrogation Claims held by Consenting Creditors.

“RSA Deadline” means November 14December 6, 2019, which date may be

amended or extended by agreement of the Debtors and the Requisite Consenting Creditors

pursuant to Section 9 herein.

“Settlement” has the meaning set forth in the recitals hereof.

“Settlement Payment Condition” has the meaning set forth in Section 3(a)(iii)

hereof.

“Subrogation Claims” means all claims (as such term is defined in section 101(5)

of the Bankruptcy Code) against the Debtors related to or in any way arising from the Wildfires

- 5 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 5

of 33
32188712.10

that arise from subrogation (whether such subrogation is contractual, equitable or statutory),

assignment (whether such assignment is contractual, equitable or statutory), or otherwise in

connection with payments made or to be made by the applicable insurer to insured tort victims,

and whether arising as a matter of state or federal law, including Section 509 of the Bankruptcy

Code, including attorneys’ fees and interest, and shall include Paid Claims and Reserved Claims.

For the avoidance of doubt, Subrogation Claims shall not include the claims of any Governmental

Unit (as defined in section 101(27) of the Bankruptcy Code) and any such claims shall not be the

subject of, or compromised under, this Agreement.

“Support Period” means the period commencing on the date the conditions set

forth in Section 27 herein have been satisfied and ending on the earlier of (i) termination of this

Agreement in accordance with Section 5 hereof, and (ii) the Effective Date.

“Transfer” has the meaning set forth in Section 7(a) hereto.

“Transferee” has the meaning set forth in Section 7(a) hereto.

“Wildfire Claims” means Claims against the Debtors resulting from or in any way

relating to the Wildfires.

“Wildfires” means the wildfires listed on Schedule 1 hereto.

(b) Rules of Construction. Each reference in this Agreement to “this

Agreement”, “hereunder”, “hereof”, “herein”, or words of like import shall mean and be a

reference to this Agreement. Including shall mean “including without limitation.” Additionally,

for all references to written notices or other writings described herein, electronic mail to the

Parties as set forth in Section 18 shall be sufficient. When a reference is made in this Agreement

to a Section, Exhibit, or Schedule, such reference shall be to a Section, Exhibit, or Schedule,

respectively, of or attached to this Agreement unless otherwise indicated. Unless the context of

this Agreement otherwise requires, (i) words using the singular or plural number also include the

plural or singular number, respectively, (ii) the words “include,” “includes” and “including” when

used herein shall be deemed in each case to be followed by the words “without limitation,” and

(iii) the word “or” shall not be exclusive and shall be read to mean “and/or.” The Parties agree

that they have been represented by legal counsel during the negotiation and execution of this

Agreement and, therefore, waive the application of any law, regulation, holding, or rule of

construction providing that ambiguities in an agreement or other document shall be construed

against the party drafting such agreement or document.

2. COMMITMENT OF THE CONSENTING CREDITORS.

(a) Affirmative Covenants. Subject to the terms and conditions hereof, for the

duration of the Support Period, each Consenting Creditor shall:

(i) Support and cooperate with the Debtors to obtain confirmation of

the Plan, provided that, notwithstanding anything to the contrary herein, nothing in

this Agreement shall be deemed to (A) create an obligation to (1) take any actions

outside the Chapter 11 Cases, or in the Chapter 11 Cases unrelated to the

- 6 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 6

of 33
32188712.10

treatment of Subrogation Claims, (2) take actions inconsistent with any legal or

contractual obligation or duty that the Consenting Creditor reasonably believes

that it has under the law, or (3) assist the Company in connection with any

regulatory or legislative action, or (B) limit the right of a Consenting Creditor to

object to a provision of the Plan unrelated to the Settlement or implementation of

the Settlement, which objection shall be limited and not seek to preclude or delay

confirmation of the Plan;

(ii) timely vote or cause to be voted (when solicited to do so in

accordance with this Agreement after receipt of a Disclosure Statement approved

by the Bankruptcy Court and by the applicable deadline for doing so) all of its

RSA Claims to accept the Plan, and not to change or withdraw such vote (or cause

or direct such vote to be changed or withdrawn) prior to the voting deadline to

accept or reject the Plan; provided that such vote may, upon written notice to the

Debtors and the other Parties, be revoked (and, upon such revocation, deemed

void ab initio) by any Consenting Creditor at any time following the expiration of

the Support Period with respect to such Consenting Creditor, provided further that

if the Court determines the Debtors are insolventmake an Insolvency

Determination and the Debtors file an Insolvent Plan, the Consenting Creditors

shall be free to vote for or against such Insolvent Plan, object to confirmation of

(and/or solicitation of votes for) such Insolvent Plan on any grounds, and,

subject to the Consenting Creditors’ rights to terminate the RSA and seek a higher

claim amount as set forth below, the Subrogation Claims will continue to be

allowed in the Allowed Subrogation Claim Amount;

(iii) timely vote (or cause to be voted) its RSA Claims against any plan,

plan proposal, restructuring proposal, offer of dissolution, winding up, liquidation,

sale or disposition, reorganization, merger or restructuring of the Company other

than the Plan (each, an “Alternative Restructuring”), provided that if the Court

determines the Debtors are insolventmake an Insolvency Determination and

the Debtors file an Insolvent Plan, the Consenting Creditors shall be free to vote

for or against any Alternative Restructuring, including an Insolvent Plan;

(iv) cooperate in good faith with respect to any subpoena served on the

holders of the RSA Claims or their counsel (whether prior to or after the

effectiveness of this Agreement) in connection with or related to Estimation

Proceedings; and

(v) enter into a joint stipulation with the Debtors in any Estimation

Proceedings that (A) informs the relevant court that the Debtors are no longer

moving to estimate the Subrogation Claims and (B) withdraws the Consenting

Creditors and the Ad Hoc Professionals from any such proceeding (as applicable),

without prejudice, when the RSA Approval Order is entered by the Bankruptcy

Court.

- 7 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 7

of 33
32188712.10

(b) Negative Covenants. Subject to the terms and conditions hereof, for the

duration of the Support Period, each Consenting Creditor shall not:

(i) delay, impede, or take any other action to interfere with the

acceptance or implementation of the Plan, including to vote any RSA Claims to

reject, the Plan; provided that (A) objecting to a provision of the Plan unrelated to

the Settlement or implementation of the Settlement (which objection shall be

limited and not seek to preclude or delay confirmation of the Plan), and

(B) participating in any ordinary course governmental processes in a manner

unrelated to the treatment of Subrogation Claims and the terms of the Settlement,

in each case, shall not be deemed to delay, impede, or interfere with confirmation

of the Plan; provided that taking any action under either clause (A) or (B) of this

Section 2(b)(i) shall not in any way be a basis for a Consenting Creditor to not

vote RSA Claims to accept the Plan (it being agreed by the Debtors that the vote

of a Consenting Creditor to accept the Plan shall not be deemed to waive or

otherwise limit its right to object to a provision of the Plan under clause (A) of this

Section 2(b)(i));

(ii) subject to the proviso in Section 2(a)(iii) hereof as to voting,

directly or indirectly, file, propose, support, solicit, assist, encourage, or participate

in the formulation of or vote for any Alternative Restructuring or settlement of the

Subrogation Claims other than as set forth herein, provided that nothing herein

precludes the Debtors and the Ad Hoc Subrogation Group from negotiating

together with any other creditor constituencies or participating in mediation to

achieve global consensus;

(iii) take any action to delay, impede, or contest any Estimation

Proceedings; or

(iv) directly or indirectly, encourage any entity to undertake any action

prohibited by this Section 2(b).

Nothing in this Agreement shall prohibit any Consenting Creditor from (A) taking any action with

regard to any Claims or interests it holds that are not RSA Claims, (B) appearing as a party-ininterest in any matter arising in the Chapter 11 Cases, and (C) taking or directing any action to be

taken relating to maintenance, protection, preservation or defense of any Claims and interests;

provided that, in each case, any such action is not inconsistent with such Consenting Creditor’s

obligations hereunder; and nothing in this Agreement shall prohibit any Consenting Creditor from

(X) enforcing any right, remedy, condition, consent, or approval requirement under this

Agreement or any Definitive Documents, or (Y) taking any action to oppose any Alternative

Restructuring. For the avoidance of doubt, notwithstanding the foregoing sentence, nothing in

this Agreement shall prohibit any Consenting Creditor from taking any action with regard to any

administrative expense claims that it holds against the Debtors, or the Debtors from taking any

action with respect thereto.

- 8 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 8

of 33
32188712.10

3. COVENANTS OF THE COMPANY.

(a) Affirmative Covenants of the Company. Subject to the terms and

conditions hereof, for the duration of the Support Period, the Company shall:

(i) use commercially reasonable efforts to propose and pursue the Plan

and seek the entry of a Confirmation Order, which incorporate the terms of the

Settlement including any conditions thereto (including all of the terms hereof

relating to the treatment of, and distributions on Subrogation Claims and the

Aggregate Subrogation Recovery), provided that if the Bankruptcy Court

determines the Debtors are insolventmake an Insolvency Determination, the

Debtors may file a revised plan that does not pay subrogation claimants $11 billion

in cash on $11 billion of allowed claims, provided, however, that such revised

plan shall not subordinate the class of Subrogation Claims to the class of IP

Claims (an “Insolvent Plan”);

(ii) use commercially reasonable efforts to support, implement, and

complete the Settlement and all transactions contemplated under this Agreement,

including incorporating the Settlement into the applicable Definitive Documents;

(iii) upon entry into any settlement with any holder or holders of IP

Claims that fixes the amount or terms for satisfaction of an IP Claim, including

with respect to rights against a post-Effective Date trust established for the

resolution and payment of such Claims, require, as a condition to payment or other

distribution to or for the benefit of such holder pursuant to such settlement or

other agreement, that the holder of the IP Claim contemporaneously execute and

deliver a release and waiver of any potential made-whole claims against present

and former holders of Subrogation Claims substantially in the form attached hereto

as Exhibit B (the “Settlement Payment Condition”), provided that the

Confirmation Order shall deem each holder of a Subrogation Claim that is a

beneficiary of a release and waiver of made-whole claims executed by a holder of

an IP Claim as set forth herein to have released such holder of an IP Claim from

any claim to such holder’s recovery from the Debtors on account of such settled IP

Claim; provided further that if the Bankruptcy Court determines the Debtors

are insolventmake an Insolvency Determination, the Debtors will no longer be

required to condition payments or other distributions pursuant to such a settlement

on the holder of the IP Claim contemporaneously executing a release of made

whole claims for the portion of their allowed claims against the Debtors’ estates

that are not fully satisfied under the revised plan;

(iv) use commercially reasonable best efforts to seek confirmation of the

Plan on or prior to automatic termination of this Agreement pursuant to Section

5(b) hereof);

(v) propose and pursue the Plan and seek entry of a Confirmation

Order that contain (and any plan and confirmation order pursued by the Debtors

- 9 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 9

of 33
32188712.10

shall contain) the following provisions, findings and orders, as applicable in

substantially the form set forth below (the “Findings and Orders”), provided that, if

the Bankruptcy Court determines the Debtors are insolventmake an

Insolvency Determination, the Debtors will not be required to pursue a plan or

confirmation order with the finding set forth in Section 3(a)(v)(A) below:

(A) the Bankruptcy Court “has determined that the resolution of

the insolvency proceeding provides funding or establishes reserves for,

provides for assumption of, or otherwise provides for satisfying any

prepetition wildfire claims asserted against the electrical corporation in the

insolvency proceeding in the amounts agreed upon in any pre-insolvency

proceeding settlement agreements or any post-insolvency settlement

agreements, authorized by the court through an estimation process or

otherwise allowed by the court;” and

(B) any settlement or other agreement with any holder or

holders of an IP Claim that fixes the amount or terms for satisfaction of an

IP Claim, including with a post-Effective Date trust established for the

resolution and payment of such claims, shall contain the Settlement

Payment Condition, subject to the provisos of Section 3(a)(iii);

(vi) use commercially reasonable efforts to promptly notify or update

counsel to the Ad Hoc Subrogation Group upon becoming aware of any of the

following occurrences: (A) a Creditor Termination Event has occurred, or (B) any

event that would reasonably be expected to materially impede or prevent

implementation of the Settlement;

(vii) unless the Company obtains the prior written consent of a

Consenting Creditor: (A) use the information regarding any Subrogation Claims

owned at any time by such Consenting Creditor (the “Confidential Claims

Information”) solely in connection with this Agreement (including any disputes

relating thereto); and (B) except as required by law, rule, or regulation or by order

of a court, including the Bankruptcy Court, or as requested or required by the

Securities and Exchange Commission or by any other federal or state regulatory,

judicial, governmental, or supervisory authority or body, keep the Confidential

Claims Information strictly confidential and not disclose the Confidential Claims

Information to any other Person. In the event that the Company is required (by

law, rule, regulation, deposition, interrogatories, requests for information or

documents in legal or administrative proceedings, subpoena, civil investigative

demand or other similar process, or by any governmental, judicial, regulatory, or

supervisory body) to disclose the Confidential Claims Information or the contents

thereof, the Company shall, to the extent legally permissible, provide affected

Consenting Creditors with prompt notice of any such request or requirement so

that such Consenting Creditors may seek a protective order or other appropriate

remedy and/or waive compliance with the provisions of this section at such

Consenting Creditor’s sole cost and expense. In no event shall this Agreement be

- 10 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 10

of 33
32188712.10

construed to impose on a Consenting Creditor an obligation to disclose the price

for or terms pursuant to which it acquired or disposed of any Subrogation Claim.

The Company’s obligations under this section shall survive termination of this

Agreement;

(viii) (A) pay the reasonable documented and contractual fees of the Ad

Hoc Professionals invoiced following entry of the RSA Approval Order on a

monthly basis promptly following receipt of summary invoices; and (B) on the

Effective Date, pay or reimburse the members of the Ad Hoc Subrogation Group

for the reasonable, documented and contractual professional fees and expenses

invoiced through entry of the RSA Approval Order by the Ad Hoc Professionals

up to an aggregate amount of $55 million (which cap shall apply to fees and

expenses invoiced before and after entry of the RSA Approval Order and which

shall include success fees, transaction fees or similar fees);

(ix) negotiate in good faith to provide each holder of Subrogation

Claims the opportunity to receive on account of its Subrogation Claim any equity

distribution (other than a rights offering) offered under the Plan on the same terms

and at the same valuation as offered to any holder of an unsecured claim

(including, an unsecured IP Claim or unsecured IP Claims as a class) in satisfaction

of the Allowed Subrogation Claim in lieu of cash (the “Non-Cash Recovery”);

(x) enter into a joint stipulation with the Consenting Creditors in any

Estimation Proceedings that (A) informs the relevant court that the Debtors are no

longer moving to estimate the Subrogation Claims and (B) withdraws the

Consenting Creditors and the Ad Hoc Professionals from any such proceeding (as

applicable) without prejudice when the RSA Approval Order is entered by the

Bankruptcy Court; and

(xi) cause each of its direct and indirect subsidiaries, whether a Party to

this Agreement or not, to comply with the terms of this Agreement as if such entity

were a Debtor entity party hereto.

(b) Negative Covenants of the Company. Subject to the terms and conditions

hereof, for the duration of the Support Period, the Company shall not, directly or indirectly:

(i) propose, pursue, or support any Plan or Confirmation Order that

does not incorporate the terms of the Settlement, including the Findings and

Orders, and is not otherwise consistent with the terms hereof (except for an

Insolvent Plan if the Bankruptcy Court determines the Debtors are

insolventmake an Insolvency Determination);

(ii) propose, support, solicit, encourage, or participate in any chapter

11 plan or settlement of the Subrogation Claims other than as set forth herein

- 11 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 11

of 33
32188712.10

(except for an Insolvent Plan if the Bankruptcy Court determines the Debtors

are insolventmake an Insolvency Determination);

(iii) enter into any settlement with any party or include any provisions in

a Plan or Confirmation Order that (A) incorporates any priority of payments or

waterfall provision that prioritizes recoveries on any other non-priority unsecured

claims ahead of Subrogation Claims, (B) otherwise materially impairs the Debtors’

ability to pay the Aggregate Subrogation Recovery in cash on the Effective Date,

or (C) expressly reserves the right of any holder of IP Claims to pursue madewhole claims against holders of Subrogation Claims;

(iv) directly or indirectly, take any actions, or fail to take any actions,

where such taking or failing to take actions would be, in either case, (A)

inconsistent with this Agreement or (B) otherwise inconsistent with, or reasonably

expected to prevent, interfere with, delay or impede the implementation or

consummation of, the Plan or the Settlement; or

(v) directly or indirectly, encourage any entity to undertake any action

prohibited by this Section 3(b).

4. ALLOWED SUBROGATION CLAIM AMOUNT. The Parties agree to settle

the Subrogation Claims for an aggregate allowed claim amount of $11 billion pursuant to

Bankruptcy Rule 9019 (the “Allowed Subrogation Claim Amount”). The Allowed Subrogation

Claim Amount, shall be binding in the Chapter 11 Cases, and shall survive termination of this

Agreement, except as otherwise expressly provided in this Agreement. Notwithstanding the

allowance of Subrogation Claims as provided herein, the right of the Ad Hoc Subrogation Group

to object to proofs of claim filed by individual holders of Subrogation Claims that are not parties

to this Agreement shall be expressly reserved. At any time the Allowed Subrogation Claim

Amount remains binding pursuant to the terms hereof, whether prior to or subsequent to the

termination of this Agreement, absent the consent of the Requisite Consenting Creditors, the

Debtors shall not (a) settle any Subrogation Claims, including with respect to the allowed amount

of such Claim, or (b) object to any Subrogation Claim.

5. TERMINATION.

(a) Individual Consenting Creditor Termination. Any individual holder of

Subrogation Claims shall be entitled to terminate this Agreement as to itself if the Aggregate

Subrogation Recovery is modified.

(b) Automatic Termination: This Agreement will terminate automatically if, (i)

the Plan is not confirmed by June 30, 2020 (or such later date as may be authorized by any

amendment to A.B. 1054), or (ii) the Effective Date does not occur prior to December 31, 2020

(or six months following the deadline for confirmation of the Plan if such deadline is extended by

any amendment to A.B. 1054); provided, the deadlines set forth in items (i) and (ii) of the

foregoing may be extended by mutual written consent of the Debtors and Consenting Creditors

holding at least 51% of the dollar amount of the RSA Claims then party to this Agreement. For

- 12 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 12

of 33
32188712.10

the avoidance of doubt, following a termination pursuant to this Section 5(b) the Allowed

Subrogation Claim Amount shall be binding in the Chapter 11 Cases, and shall survive termination

of this Agreement.

(c) Insolvency Termination.

(i) The Requisite Consenting Creditors may terminate this Agreement

if, upon the advice of the Ad Hoc Professionals (after consultation with the

Debtors’ professionals), they reasonably determine in good faith at any time prior

to confirmation of the Plan, that the Debtors are (i) insolvent (whether as a result

of judicial findings arising from the Estimation Proceedings, litigation related to the

IP Claims, the incurrence of post-petition wildfire liabilities, or otherwise), or (ii)

unable to raise sufficient capital to pay the Aggregate Subrogation Recovery in

cash and any agreed upon Non-Cash Recovery on the Effective Date; provided

that the Debtors shall retain the right to promptly contest any such determination

with the dispute to be determined by the Bankruptcy Court whose determination

shall be binding for purposes of this Agreement. If the Requisite Consenting

Creditors elect to terminate this Agreement following either of the foregoing

determinations, subject to the Bankruptcy Court’s ruling if such determination is

disputed by the Debtors, (ana “Creditor Insolvency Termination”) then the

Allowed Subrogation Claim Amount shall no longer be binding in the Chapter 11

Cases, and the holders of Subrogation Claims, the Debtors and other parties in

interest shall have all rights reserved, including with respect to the amount, future

allowability and treatment of all Subrogation Claims.

(ii) The Debtors may terminate this Agreement if, upon the advice

of the Debtors’ professionals (after consultation with the Ad Hoc

Professionals), the Debtors reasonably determine in good faith at any time

prior to confirmation of the Plan, that the Debtors are insolvent for all

purposes in the Chapter 11 Cases as of the time such determination is made

(whether as a result of judicial findings arising from the Estimation

Proceedings, litigation related to the IP Claims, the incurrence of postpetition wildfire liabilities or otherwise) (such determination, subject to the

Requisite Consenting Creditors’ right to promptly contest any such

determination with the dispute to be determined by the Bankruptcy Court

whose determination shall be binding for purposes of this Agreement, an

“Insolvency Determination”). If the Debtors make an Insolvency

Determination and elect to terminate this Agreement (a “Debtor Insolvency

Termination”), the Allowed Subrogation Claim Amount shall be binding in

the Chapter 11 Cases, and shall survive termination of this Agreement unless

the Requisite Consenting Creditors elect to pursue a higher claim amount as

set forth below.

(d) Requisite Consenting Creditors Termination Events. The Requisite

Consenting Creditors may terminate this Agreement, in each case, upon delivery of written notice

- 13 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 13

of 33
32188712.10

to the Company at any time after the occurrence of or during the continuation of any of the

following events (each, a “Creditor Termination Event”):

(i) the breach by the Company of any of its obligations,

representations, warranties, or covenants set forth in this Agreement;

(ii) The Debtors at any time either (A) fail to propose and pursue a

Plan and Confirmation Order that contain the terms of the Settlement, including

the Findings and Orders, and are otherwise consistent with the terms hereof, or (B)

propose, pursue or support or announce in writing or in court an intention to

propose, pursue or support a Plan or Confirmation Order inconsistent with the

terms of the Settlement, the Findings and Orders, or the terms hereof;

(iii) The Plan proposed and pursued by the Debtors does not treat the

IP Claims consistent with the provisions of A.B. 1054;

(iv) The Bankruptcy Court allows a plan proponent other than the

Debtors to commence soliciting votes on a plan other than the Plan incorporating

the Settlement, and the Debtors have not already solicited, or are not

simultaneously soliciting, votes on the Plan incorporating the Settlement;

(v) The Bankruptcy Court confirms a plan other than the Plan

incorporating the Settlement;

(vi) The Plan is, or is modified to be, inconsistent with the Settlement;

(vii) The issuance, promulgation, or enactment by any governmental

entity, including any regulatory or licensing authority or court of competent

jurisdiction (including, without limitation, an order of the Bankruptcy Court which

has not been stayed), of any statute, regulation, ruling or order declaring the Plan

or any material portion thereof (in each case, to the extent it relates to the

Settlement or the terms hereof) to be unenforceable or enjoining or otherwise

restricting the consummation of any material portion of the Plan (to the extent it

relates to the Settlement) or the Settlement, and such ruling, judgment, or order

has not been stayed, reversed, or vacated, within fifteen (15) calendar days after

issuance;

(viii) a trustee under section 1104 of the Bankruptcy Code or an

examiner with expanded powers shall have been appointed in the Chapter 11

Cases; or

(ix) an order for relief under chapter 7 of the Bankruptcy Code shall

have been entered in the Chapter 11 Cases, or the Chapter 11 Cases shall have

been dismissed, in each case by order of the Bankruptcy Court.

Notwithstanding the foregoing, the Debtors shall have ten (10) days from the receipt of any such

written notice of termination from the Requisite Consenting Creditors specifying the purported

- 14 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 14

of 33
32188712.10

default or Creditor Termination Event to cure any purported default or Creditor Termination

Event under this section and no termination of this Agreement shall be effective unless and until

the expiration of such ten (10) day period without such purported default or Creditor Termination

Event being waived or cured, provided that such ten (10) day period shall not be applicable to the

extent passage of such period would materially impair the rights of Consenting Creditors to object

to, vote against, or appear in Court with respect to the Plan, which actions shall be permitted

following written notice of termination from the Requisite Consenting Creditors only if the

deadline to object to or vote on the Plan, or a court hearing on the Plan, occurs within such ten

(10) day period. The Requisite Consenting Creditors may elect to pursue a higher claim amount

by written notice to the Debtors of such election within ten (10) days of (a) termination following

a Creditor Termination Event, or (b) a Debtor Insolvency Termination (the “Allowance

Termination Notice”). Following the delivery of an Allowance Termination Notice, the Allowed

Subrogation Claim Amount shall no longer be binding in the Chapter 11 Cases, and the holders of

Subrogation Claims, the Debtors and other parties in interest shall have all rights reserved,

including with respect to the amount, future allowability and treatment of all Subrogation Claims.

(e) Debtors Termination. The Debtors may terminate this Agreement by

written notice to the Ad Hoc Professionals upon (each, a “Debtor Termination Event”):

(i) the breach by Consenting Creditors holding at least 5% of the RSA

Claims then party to this Agreement (measured either by dollar amount or number

of holders) of any of their undertakings, obligations, representations, warranties, or

covenants set forth in this Agreement and thereafter the Allowed Subrogation

Claim Amount shall no longer be binding in the Chapter 11 Cases, and the holders

of Subrogation Claims, the Debtors and other parties in interest shall have all rights

reserved, including with respect to the amount, future allowability and treatment of

all Subrogation Claims; or

(ii) (A) The Bankruptcy Court confirms a plan other than the Plan

incorporating the Settlement, or (B) the issuance, promulgation, or enactment by

any governmental entity, including any regulatory or licensing authority or court of

competent jurisdiction (including, without limitation, an order of the Bankruptcy

Court which has not been stayed), of any statute, regulation, ruling or order

declaring the Plan or any material portion thereof (in each case, to the extent it

relates to the Settlement or the terms hereof) to be unenforceable or enjoining or

otherwise restricting the consummation of any material portion of the Plan (to the

extent it relates to the Settlement) or the Settlement, and such ruling, judgment, or

order has not been stayed, reversed, or vacated, within fifteen (15) calendar days

after issuance. For the avoidance of doubt, following a termination pursuant to

this Section 5(e)(ii), unless otherwise ordered by a court of competent jurisdiction

or governmental entity, the Allowed Subrogation Claim Amount shall be binding in

the Chapter 11 Cases, and shall survive such termination of this Agreement,

subject to the right of the Requisite Consenting Creditors to deliver an Allowance

Termination Notice as set forth above.

- 15 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 15

of 33
32188712.10

Notwithstanding the foregoing, the Consenting Creditors shall have ten (10) days from the receipt

of any such written notice of termination from the Debtors specifying the purported default or

Debtor Termination Event to cure any purported default or Debtor Termination Event under this

section and no termination of this Agreement shall be effective unless and until the expiration of

such ten (10) day period without such purported default or Debtor Termination Event being

waived or cured. The Debtor Termination Event set forth in Section 5(e)(i) shall be deemed

cured if, ten (10) days after receipt of the termination notice, non-breaching Consenting Creditors

then party to this Agreement (A) hold at least 95% of the RSA Claims (in dollar amount), and (B)

out number RSA Claim holders breaching this Agreement by a ratio of 19-1.

(f) Termination Generally.

(i) No Party may terminate this Agreement based on an event caused

by such Party’s own failure to perform or comply in all material respects with the

terms and conditions of this Agreement (unless such failure to perform or comply

arises as a result of another Party’s actions or inactions).

(ii) Upon termination of this Agreement in accordance with this Section

5, all Parties shall be released from any prospective commitments, undertakings,

and agreements under or related to this Agreement other than obligations under

this Agreement which by their terms expressly survive termination.

(iii) For the avoidance of doubt, (A) termination of this Agreement shall

not relieve any Party of any liability on account of any breach hereof, including any

breach of covenants, and the Parties may pursue remedies at law or in equity, (B)

without limiting the foregoing, termination does not relieve any Consenting

Creditor from liability to any other Consenting Creditor for any intentional or

knowing breach hereof, (C) notwithstanding anything herein to the contrary, the

delivery of the Allowance Termination Notice to the Debtors shall not be required

upon the occurrence of ana Creditor Insolvency Termination in order for the

holders of RSA Claims, the Debtors or other parties in interest to exercise all of

their respective rights, including with respect to the amount, future allowability and

treatment of all Subrogation Claims, and (D) absent the delivery of an Allowance

Termination Notice, the occurrence of ana Creditor Insolvency Termination, or

termination by the Debtors of this Agreement in accordance with Section 5(e)(i)

hereof, the Allowed Subrogation Claim Amount, and each holder’s share thereof,

shall remain an allowed claim and binding in these Chapter 11 Cases even if a

Debtor is in breach of this Agreement.

6. MUTUAL REPRESENTATIONS, WARRANTIES.

Each of the Parties, severally and not jointly, represents and warrants to each other Party that the

following statements are true, correct, and complete as of the date hereof (or, if later, the date

that such Party first became or becomes a Party) but, solely with respect to the Company, subject

- 16 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 16

of 33
32188712.10

to any limitations or approvals arising from, or required by, the commencement of the Chapter 11

Cases:

(a) it is validly existing and in good standing under the laws of the state of its

organization, and this Agreement is a legal, valid, and binding obligation of such Party,

enforceable against it in accordance with its terms, except as enforcement may be limited by

bankruptcy, insolvency, reorganization, moratorium, or other similar laws relating to or limiting

creditors’ rights generally or by equitable principles relating to enforceability;

(b) except as expressly provided in this Agreement or as may be required for

disclosure by the Securities and Exchange Commission, no material consent or approval of, or any

registration or filing with, any governmental authority or regulatory body is required for it to carry

out the Settlement contemplated by, and perform its obligations under, this Agreement;

(c) except as expressly provided in this Agreement, it has all requisite

organizational power and authority to enter into this Agreement and to carry out the Settlement

contemplated by, and perform its obligations under, this Agreement;

(d) the execution and delivery by it of this Agreement, and the performance of

its obligations hereunder, have been duly authorized by all necessary organizational action on its

part;

(e) it has been represented by counsel in connection with this Agreement and

the transactions contemplated by this Agreement; and

(f) the execution, delivery, and performance by such Party of this Agreement

does not and will not (i) violate any provision of law, rule, or regulation applicable to it or any of

its subsidiaries or its charter or bylaws (or other similar governing documents) or those of any of

its subsidiaries, (ii) conflict with, result in a breach of, or constitute (with or without notice or

lapse of time or both) a default under any material debt for borrowed money to which it or any of

its subsidiaries is a party, or (iii) violate any order, writ, injunction, decree, statute, rule, or

regulation.

7. TRANSFER OF CLAIMS

(a) Each Consenting Creditor agrees that it shall not sell, assign, grant,

transfer, convey, hypothecate or otherwise dispose of (each, a “Transfer”) any RSA Claims now

owned or hereafter acquired, or any option thereon or any right or interest (voting or otherwise)

in any or all of its RSA Claims, except to a party that (i) is a Consenting Creditor, or (ii), as a

condition subsequent to the effectiveness of any such Transfer, executes and delivers a Transfer

Agreement in the form attached hereto as Exhibit C to counsel to the Ad Hoc Subrogation

Group, the Company, and to Weil, Gotshal & Manges LLP no more than five (5) Business Days

after the settlement of the relevant Transfer (a “Transferee”), and any such RSA Claim

automatically shall be deemed to be subject to the terms of this Agreement. With respect to any

Transfers effectuated in accordance with clause (ii) above, (A) such Transferee shall be deemed to

- 17 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 17

of 33
32188712.10

be a Consenting Creditor for purposes of this Agreement, and (B) the Company shall be deemed

to have acknowledged such Transfer.

(b) This Agreement shall in no way be construed to preclude any Consenting

Creditor from acquiring additional Subrogation Claims against the Company; provided, that,

(i) any such additional Subrogation Claims automatically shall be deemed to be RSA Claims and

shall be subject to all of the terms of this Agreement and (ii) each such Consenting Creditor

agrees that such additional RSA Claims shall be subject to this Agreement.

(c) Any Transfer of RSA Claims that does not comply with this Section 7 shall

be deemed null and void ab initio in all respects and without further action by any Party.

(d) Notwithstanding anything herein to the contrary, to the extent that a

Consenting Creditor effects the Transfer of all of its Subrogation Claims in accordance with this

Agreement, including, for the avoidance of doubt, in accordance with the foregoing portion of

this Section 7, such Consenting Creditor shall cease to be a Party to this Agreement in all respects

and shall have no further obligations hereunder.

8. COOPERATION. Each Party hereby covenants and agrees to cooperate

with each other in good faith in connection with, and shall exercise commercially reasonable

efforts with respect to the pursuit, approval, negotiation, execution, delivery, and implementation

of the Settlement and the Plan, subject to the same provisos contained in Sections 2(a)(i) and 2(b)

of this Agreement. The Company shall use commercially reasonable efforts to provide counsel for

the Ad Hoc Subrogation Group drafts of all motions, applications, and other substantive pleadings

(including Plan and/or Disclosure Statement amendments) the Company intends to file with the

Bankruptcy Court to implement the Settlement (or that could reasonably be expected to affect

implementation of the Settlement) at least three (3) calendar days before the date when the

Company intends to file such pleading, unless such advance notice is impossible or impracticable

under the circumstances, in which case the Company shall use commercially reasonable efforts to

notify telephonically or by electronic mail counsel to the Ad Hoc Subrogation Group to advise

them as such and, in any event, shall provide such drafts as soon as reasonably practicable.

9. AMENDMENTS. Unless otherwise specifically provided herein, no

amendment, modification, waiver, or other supplement of the terms of this Agreement or Sections

4.6, 4.19, 6.4, 6.5, 6.6 or 10.9 of the Plan (to the extent such Sections impact Subrogation Claims

or holders of Subrogation Claims), and any defined terms used or operative documents referenced

therein, shall be valid unless such amendment, modification, waiver, or other supplement is in

writing and has been signed by the Company and the Requisite Consenting Creditors; provided,

however, that (a) any amendment to this Agreement to (i) the defined term “Requisite Consenting

Creditors” and any defined term used in that definition, (ii) the defined term “RSA Approval

Order,” (iii) Section 5(a) hereof and any defined term used in that Section, (iv) the conditions to

the effectiveness of this Agreement set forth in Section 27, and (v) this Section 9, shall require the

written consent of the Company and each Consenting Creditor, (b) any amendment to this

Agreement that disproportionately affects any Consenting Creditor or modifies any Consenting

Creditor’s obligations under Sections 2 or 8 hereof shall require the written consent of such

Consenting Creditor, and (c) so long as the Plan and the Definitive Documents incorporate the

- 18 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 18

of 33
32188712.10

terms of the Settlement, including the Findings and Orders, and do not adversely affect the

Settlement or the rights of the Parties under this Agreement no consent of any Consenting

Creditor shall be required to amend or otherwise modify the terms of the Plan or any other

Definitive Document subject to the first sentence of this Section 9, and provided that Section

10.10 of the Plan shall not be deemed to authorize the subordination of Subrogation Claims.

Notwithstanding anything herein to the contrary, any material modifications or amendments to

this Agreement shall be subject to Bankruptcy Court approval on not less than fivetwenty-one

(521) Business Daysdays’ notice, subject to the right of any Party to move for shortened

notice.

10. ENTIRE AGREEMENT. This Agreement constitutes the entire

agreement of the Parties with respect to the subject matter of this Agreement, and supersedes all

other prior negotiations, agreements and understandings, whether written or oral, among the

Parties with respect to the subject matter of this Agreement; provided, however, that any

confidentiality agreement executed by any Consenting Creditor or Ad Hoc Professionals shall

survive this Agreement and shall continue to be in full force and effect in accordance with their

terms.

11. SURVIVAL OF AGREEMENT. Notwithstanding the termination of

this Agreement, the agreements and obligations of the Parties that expressly survive termination

by their terms and those in Sections 10 through 27 (and any defined terms used in any such

Sections) shall survive such termination and shall continue in full force and effect in accordance

with the terms hereof, and any liability of a Party for failure to comply with the terms of this

Agreement shall survive termination.

12. NO WAIVER OF PARTICIPATION AND PRESERVATION OF

RIGHTS. Except as specifically provided in Sections 4 and 5 with respect to the Allowed

Subrogation Claim Amount, if the transactions contemplated herein are not consummated, or

following the occurrence of the termination of this Agreement with respect to all Parties, nothing

herein shall be construed as a waiver by any Party of any or all of such Party’s rights, remedies,

claims, and defenses and the Parties expressly reserve any and all of their respective rights,

remedies, claims and defenses.

13. COUNTERPARTS. This Agreement may be executed in several

counterparts, each of which shall be deemed to be an original, and all of which together shall be

deemed to be one and the same agreement. Execution copies of this Agreement may be delivered

by electronic mail in portable document format (pdf.), facsimile or otherwise, which shall be

deemed to be an original for the purposes of this paragraph.

14. HEADINGS. The headings of the Sections, paragraphs, and subsections

of this Agreement are inserted for convenience only and shall not affect the interpretation hereof

or, for any purpose, be deemed a part of this Agreement.

15. RELATIONSHIP AMONG PARTIES. Notwithstanding anything

herein to the contrary, the duties and obligations of the Consenting Creditors under this

Agreement shall be several, not joint. No Consenting Creditor shall, as a result of its entering into

- 19 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 19

of 33
32188712.10

and performing its obligations under this Agreement, be deemed to be part of a “group” (as that

term is used in section 13(d) of the Securities Exchange Act of 1934, as amended, and the rules

and regulations promulgated thereunder) with any of the other Consenting Creditors. It is

understood and agreed that no Consenting Creditor has any duty of trust or confidence in any

kind or form with any other Consenting Creditor, and, except as expressly provided in this

Agreement, there are no commitments among or between them. No prior history, pattern, or

practice of sharing confidences among or between the Consenting Creditors shall in any way

affect or negate this understanding and agreement.

16. REMEDIES. It is understood and agreed by the Parties that, without

limiting any other remedies available at law or equity, money damages would be an insufficient

remedy for any breach of this Agreement by any Party and each non-breaching Party (including

non-breaching Consenting Creditors, if the breaching Party is another Consenting Creditor) shall

be entitled to specific performance and injunctive or other equitable relief as a remedy of any such

breach, including, without limitation, an order of the Bankruptcy Court or other court of

competent jurisdiction requiring any Party to comply promptly with any of its obligations

hereunder, without the necessity of proving the inadequacy of money damages as a remedy. Each

of the Parties hereby waives any defense that a remedy at law is adequate and any requirement to

post bond or other security in connection with actions instituted for injunctive relief, specific

performance, or other equitable remedies.

17. JURY TRIAL, GOVERNING LAW AND DISPUTE RESOLUTION.

(a) This Agreement shall be construed and enforced in accordance with, and

the rights of the parties shall be governed by, the law of the State of New York and applicable

federal law, without giving effect to the conflicts of law principles thereof.

(b) Each Party irrevocably agrees that any legal action, suit or proceeding

arising out of or relating to this Agreement brought by any party or its successors or assigns shall

be brought and determined in the Bankruptcy Court and each Party hereby irrevocably submits to

the exclusive jurisdiction of the Bankruptcy Court and, if the Bankruptcy Court does not have (or

abstains from) jurisdiction, Courts of the State of California and of the United States District

Court of the Northern District of California, and any appellate court from any thereof, for itself

and with respect to its property, generally and unconditionally, with regard to any such

proceeding arising out of or relating to this Agreement. Each Party further agrees that notice as

provided herein shall constitute sufficient service of process and the Parties further waive any

argument that such service is insufficient. Each Party hereby irrevocably and unconditionally

waives, and agrees not to assert, by way of motion or as a defense, counterclaim or otherwise, in

any proceeding arising out of or relating to this Agreement, (i) any claim that it is not personally

subject to the jurisdiction of the Bankruptcy Court as described herein for any reason, (ii) that it

or its property is exempt or immune from jurisdiction of such court or from any legal process

commenced in such court (whether through service of notice, attachment prior to judgment,

attachment in aid of execution of judgment, execution of judgment or otherwise) and (iii) that (A)

the proceeding in such court is brought in an inconvenient forum, (B) the venue of such

- 20 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 20

of 33
32188712.10

proceeding is improper or (C) this Agreement, or the subject matter hereof, may not be enforced

in or by such court.

(c) EACH PARTY HEREBY WAIVES, TO THE FULLEST EXTENT

PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY

JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT

OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS

CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY

OTHER THEORY). EACH PARTY (I) CERTIFIES THAT NO REPRESENTATIVE,

AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,

EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE

EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND

(II) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HAVE BEEN

INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS,

THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

18. NOTICES. All notices hereunder shall be deemed given if in writing and

delivered, if contemporaneously sent by electronic mail, facsimile, courier or by certified mail

(return receipt requested) to the following addresses and facsimile numbers:

PG&E Corporation

77 Beale Street

San Francisco, CA 94105

Attention: Janet Loduca (j1lc@pge.com)

With a copy to:

Weil, Gotshal & Manges LLP 767 Fifth Avenue

New York, NY 10153

Attention: Stephen Karotkin, Jessica Liou, and Matthew Goren

(stephen.karotkin@weil.com, jessica.liou@weil.com, matthew.goren@weil.com)

- and -

Cravath, Swaine & Moore LLP 825 8th Avenue

New York, NY 10019

Attention: Kevin Orsini and Paul Zumbro (korsini@cravath.com,

pzumbro@cravath.com)

If to a Consenting Creditor, to the address set forth beneath such creditor’s

signature block, and, if to a member of the Ad Hoc Subrogation Group, with a

copy to:

Willkie Farr & Gallagher LLP

787 Seventh Avenue

New York, NY 10019

- 21 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 21

of 33
32188712.10

Attention: Matthew A. Feldman, Joseph G. Minias, and Daniel I. Forman

(mfeldman@willkie.com, jminias@willkie.com, and dforman@willkie.com)

For the avoidance of doubt when written notice or approval from Requisite Consenting Creditors

is required by this Agreement, electronic mail from Requisite Consenting Creditors’ counsel to

Company’s counsel shall be sufficient. Any notice given by mail or courier shall be effective when

received. Any notice given by facsimile or electronic mail shall be effective upon oral, machine or

electronic mail (as applicable) confirmation of transmission.

19. NO ASSIGNMENTS; THIRD-PARTY BENEFICIARIES. Except as

expressly provided herein, this Agreement may not be assigned by any Party. The terms and

provisions of this Agreement are intended solely for the benefit of the Parties hereto and their

respective successors, and it is not the intention of the Parties to confer third-party beneficiary

rights upon any other Person.

20. [RESERVED].

21. SETTLEMENT DISCUSSIONS. This Agreement is part of a proposed

settlement of matters that could otherwise be the subject of litigation among the Parties hereto.

Nothing herein shall be deemed an admission of any kind. Pursuant to Federal Rule of Evidence

408 and any applicable state rules of evidence, this Agreement and all negotiations relating thereto

shall not be admissible into evidence in any proceeding other than to prove the existence of this

Agreement or in a proceeding to enforce the terms of this Agreement.

22. GOOD-FAITH COOPERATION; FURTHER ASSURANCES.

Subject to the terms and conditions hereof, the Parties shall take such action as may be reasonably

necessary or reasonably requested by the other Party to carry out the purposes and intent of this

Agreement.

23. QUALIFICATION ON CONSENTING CREDITOR

REPRESENTATIONS. The Parties acknowledge that all representations, warranties,

covenants, and other agreements made by any Consenting Creditor are made solely in such

creditor’s capacity as a holder of Subrogation Claims. The Parties further acknowledge that all

representations, warranties, covenants, and other agreements made by any Consenting Creditor

that is a separately managed account of an investment manager are being made only with respect

to the Claims managed by such investment manager (in the amount identified on the signature

pages hereto), and shall not apply to (or be deemed to be made in relation to) any Claims that may

be beneficially owned by such Consenting Creditor that are not held through accounts managed

by such investment manager.

24. PUBLICITY. The Company shall use commercially reasonable efforts to

submit drafts to the Ad Hoc Professionals of any press releases and public documents that

constitute disclosure of the existence or terms of this Agreement or any amendment to the terms

of this Agreement at least three (3) Business Days prior to making any such disclosure, and shall

- 22 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 22

of 33
32188712.10

afford them a reasonable opportunity under the circumstances to comment on such documents

and disclosures and shall incorporate any such reasonable comments in good faith.

25. SEVERABILITY. If any provision of this Agreement, or the application

of any such provision to any person or entity or circumstance, shall be held invalid or

unenforceable in whole or in part, such invalidity or unenforceability shall attach only to such

provision or part thereof and the remaining part of such provision hereof and this Agreement shall

continue in full force and effect so long as the economic or legal substance of the transactions

contemplated hereby is not affected in any manner materially adverse to any Party. Upon any

such determination of invalidity, the Parties shall negotiate in good faith to modify this Agreement

so as to effect the original intent of the Parties as closely as possible in a reasonably acceptable

manner in order that the transactions contemplated hereby are consummated as originally

contemplated to the greatest extent possible.

26. ADDITIONAL CONSENTING CREDITORS. Any holder of

Subrogation Claims may at any time become a party to this Agreement as a Consenting Creditor

(a “Joining Party”) by executing a joinder agreement (the “Joinder”) substantially in the form

attached as Exhibit D hereto, pursuant to which such Joining Party represents and warrants to the

Company and the other Consenting Creditors that it agrees to be bound by the terms of this

Agreement as a Consenting Creditor hereunder.

27. EFFECTIVENESS OF THE RESTRUCTURING SUPPORT

AGREEMENT.

Except as set forth in the immediately succeeding sentence, this Agreement shall be

effective and binding on all Parties upon (a) execution and delivery of signature pages to the

Company of Consenting Creditors holding, as reflected on the signature pages hereto, at least

70% in dollar amount of all Subrogation Claims, including at least 70% of the dollar amount of

all Subrogation Claims and more than 50% in number of holders for each of the asterisked

Northern California wildfires listed in Schedule 1 hereto, and (b) entry of the RSA Approval

Order. Upon execution of this Agreement by such Consenting Creditors and the Debtors until the

earlier of entry of the RSA Approval Order and the RSA Deadline, the Debtors shall proceed in

good faith to seek Bankruptcy Court approval of this Agreement and the Parties shall not, directly

or indirectly, propose, file, support, solicit, encourage or participate in any chapter 11 plan or

settlement of the Subrogation Claims other than as set forth herein. This Agreement shall be null

and void, and of no further force or effect, if the RSA Approval Order is not entered by the RSA

Deadline.

[Signature Pages Follow]

- 23 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 23

of 33
32188712.10

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the

date first written above.

PG&E CORPORATION

By:

Name: 

Title:

Telephone:

Facsimile:

PACIFIC GAS AND ELECTRIC COMPANY

By:

Name: 

Title:

Telephone:

Facsimile:

- 24 -

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 24

of 33
CONSENTING CREDITOR:

By:

Name:

Title:

Telephone:

Facsimile:

Subrogation Claims (Including Paid and Reserved Claims): $_______________________

NOTICE ADDRESS:

Attention:

Facsimile:

E-mail:

Signature Page to Restructuring Support Agreement

3473341.2 Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 25

of 33
Schedule 1

1. 2017 North Bay Wildfires

a. 37

b. Atlas*

c. Blue

d. Cascade/LaPorte Complex*

e. Cherokee*

f. Honey*

g. Lobo*

h. Maacama

i. McCourtney*

j. Nuns Complex (including Adobe, Norrbom, Nuns, Partrick, Pressley,

Pythian/Oakmont)*

k. Pocket*

l. Point*

m. Redwood/Potter Valley Complex*

n. Sullivan

o. Sulphur*

p. Tubbs*

2. 2018 Camp Fire*

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 26

of 33
Exhibit A

Plan

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 27

of 33
Exhibit B

Form of Release

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 28

of 33
Exhibit C

Transfer Agreement

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 29

of 33
3473341.2

TRANSFER AGREEMENT

The undersigned (together with its affiliates, the “Transferee”) (a) hereby acknowledges

that it has read and understands the Restructuring Support Agreement, dated as of

 2019 (the “Agreement”),1

 by and among the Company and each of the

Consenting Creditors party thereto, (b) desires to acquire the Claims described below (the

“Transferred Claims”) from one of the Consenting Creditors (the “Transferor”), (c) agrees to

abide by and join any allocation agreement previously entered into by and among the Consenting

Creditors, and (d) hereby irrevocably agrees that it and its affiliates shall be bound by the terms

and conditions of the Agreement to the same extent Transferor was thereby bound with respect to

the Transferred Claims, and it and its affiliates shall be deemed a Consenting Creditor for all

purposes under the Agreement.

The Transferee hereby specifically and irrevocably agrees (i) to be bound by the terms

and conditions of the Agreement, (ii) to be bound by the vote of the Transferor if cast prior to the

effectiveness of the transfer of the Transferred Claims, except as otherwise provided in the

Agreement and (iii) that each of the Parties shall be an express third-party beneficiary of this

Transfer Agreement and shall have the same recourse against the Transferee under the Agreement

as such Party would have had against the Transferor with respect to the Transferred Claims.

TRANSFEREE

___________________________________

By:

Name:

Title:

Subrogation Claims:

$

Notice Address:

Attn:

Fax:

Email:

1

 Capitalized terms used but not defined herein have the meanings ascribed to such terms in the Agreement.

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 30

of 33
Exhibit D

Joinder

3473341.2

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 31

of 33
3473341.2

JOINDER

The undersigned (together with its affiliates, the “Joining Party”) (a) hereby

acknowledges that it has read and understands the Restructuring Support Agreement, dated as of

 2019 (the “Agreement”),1 by and among the Company and each of the

Consenting Creditors party thereto, (b) desires to join and hereby irrevocably agrees that it and its

affiliates shall be bound by the terms and conditions of the Agreement in all respects, and it and its

affiliates shall be deemed a Consenting Creditor for all purposes under the Agreement, and (c)

agrees to abide by and join any allocation agreement previously entered into by and among the

Consenting Creditors.

JOINING PARTY

___________________________________

By:

Name:

Title:

Subrogation Claims

$

Notice Address:

Attn:

Fax:

Email:

1

 Capitalized terms used but not defined herein have the meanings ascribed to such terms in the Agreement.

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 32

of 33
Summary report:

Litéra® Change-Pro TDC 10.1.0.300 Document comparison done on

12/2/2019 12:05:20 PM

Style name: Standard

Intelligent Table Comparison: Active

Original DMS: iw://NYCDMS/NewYork/29767812/45

Modified DMS: iw://NYCDMS/NewYork/32188712/10

Changes:

Add 30

Delete 27

Move From 0

Move To 0

Table Insert 0

Table Delete 0

Table moves to 0

Table moves from 0

Embedded Graphics (Visio, ChemDraw, Images etc.) 0

Embedded Excel 0

Format changes 0

Total Changes: 57

Case: 19-30088 Doc# 4921-2 Filed: 12/02/19 Entered: 12/02/19 11:31:05 Page 33

of 33