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Weil, Gotshal & Manges LLP

767 Fifth Avenue

New York, NY 10153-0119

Exhibit A

Willkie Letter

Case: 19-30088 Doc# 4339-1 Filed: 10/21/19 Entered: 10/21/19 12:47:15 Page 1

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October 21, 2019 

VIA EMAIL 

Robert A. Julian 

Cecily A. Dumas 

Dennis F. Dunne 

Samuel A. Khalil 

Michael S. Stamer 

David H. Botter 

Baker & Hostetler LLP 

1160 Battery Street, Suite 100 

San Francisco, CA 94111 

Milbank LLP 

55 Hudson Yards 

New York, NY 10001 

Akin Gump Strauss Hauer & 

Feld LLP 

One Bryant Park 

New York, NY 10036 

Andrew I. Silfen 

Beth M. Brownstein 

Joseph H. Hunt 

Ruth A. Harvey 

Xavier Becerra 

Margarita Padilla 

Arent Fox LLP 

1301 Avenue of the Americas, 

42nd Floor 

New York, NY 10019 

P.O. Box 875 

Ben Franklin Station 

Washington, DC 20044-0875 

1515 Clay Street, 20th Floor 

P.O. Box 70550 

Oakland, CA 94612-0550 

Rebecca J. Winthrop Timothy S. Laffredi 

Norton Rose Fulbright US LLP 

555 South Flower Street, 41st

Floor 

Los Angeles, CA 90071 

United States Department of 

Justice 

Office of the U.S. Trustee 

450 Golden Gate Avenue, 

Suite 05-0153 

San Francisco, CA 94102 

Re: In re PG&E Corp. and Pacific Gas and Electric Company, Case No. 19-30088 (DM) 

Dear Counsel: 

We have reviewed your objections to the pending motion to approve the settlement of 

subrogation claims and associated restructuring support agreement between the PG&E 

Corporation and Pacific Gas and Electric Company (the “Debtors”) and the holders of 

subrogation claims (the “RSA”). In an effort to limit the issues in dispute ahead of this week’s 

hearing, the Ad Hoc Subrogation Group makes the following representations, which we 

understand to be consistent with the Debtors’ understanding of the RSA. With the following 

clarifications, we hope to address many of the concerns raised in your objections, and therefore 

significantly narrow the issues that need to argued before the Court: 

1. Plan Negotiations/Global Settlement: Consistent with Judge Montali’s stated desire to 

“facilitate negotiations for a global resolution and narrow the issues which are in 

787 Seventh Avenue

New York, NY 10019-6099 

Tel: 212 728 8000 

Fax: 212 728 8111 

Case: 19-30088 Doc# 4339-1 Filed: 10/21/19 Entered: 10/21/19 12:47:15 Page 2

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NEW YORK WASHINGTON HOUSTON PALO ALTO PARIS LONDON FRANKFURT BRUSSELS MILAN ROME 

legitimate dispute,”1 nothing in the RSA 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. In fact, the settlement of 

subrogation claims for $11 billion resolves one of the few remaining major open issues, 

and brings the cases one step closer to resolution.

2. Consequences of Insolvency: It was never the parties’ intention to require the Debtors to 

file a plan that would pay subrogation claimants $11 billion in cash on $11 billion of 

allowed claims if the Debtors are insolvent. Therefore, we are willing to clarify in an 

amendment to the RSA or the order approving the RSA, that if the Court determines the 

Debtors are insolvent, the Debtors will no longer be required to: 

a. file a plan that pays subrogation claimants $11 billion in cash on $11 billion of 

allowed claims; 

b. require that individual claimants in connection with a voluntary settlement release 

made whole claims per section 3(a)(iii) of the RSA for the portion of their 

allowed claims against the Debtors’ estates that are not fully satisfied under the 

revised plan; or 

c. pursue a plan or confirmation order with the finding set forth in section 3(a)(v)(A) 

of the RSA.2

If the Court determines the Debtors are insolvent and the Debtors file a revised plan that 

does not pay the subrogation claimants $11 billion in cash, the Consenting Creditors 

would be free to vote for or against any such revised plan. For the avoidance of doubt, 

subject to the right to terminate the RSA and seek a higher claim as provided in the RSA, 

the subrogation claims will continue to be allowed in the aggregate amount of $11 

billion. 

3. Releases: Three clarifications with respect to the releases referenced in section 3(a)(iii) 

of the RSA and Section 10.9(b) of the draft plan attached to the RSA: 

 

1

 Order Granting Joint Motion of the Official Committee of Tort Claimants and the Ad Hoc Committee of 

Senior Unsecured Noteholders to Terminate the Debtors’ Exclusive Periods Pursuant ot Section 1121(d)(1) 

of the Bankruptcy Code [Docket No. 4167]. 

2

 Section 3(a)(v)(A) of the RSA provides as follows: 

 Subject to the terms and conditions hereof, for the duration of the Support Period, the Company shall . . . 

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

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

substantially the form set forth below (the “Findings and Orders”): (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 preinsolvency proceeding settlement agreements or any post-insolvency settlement agreements, authorized by 

the court through an estimation process or otherwise allowed by the court.” 

Case: 19-30088 Doc# 4339-1 Filed: 10/21/19 Entered: 10/21/19 12:47:15 Page 3

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First. As previously communicated to counsel to the Official Committee of Tort 

Claimants (the "TCC") in person at the October 7 hearing, and in writing by letter 

dated October 8, the releases of subrogation claim holders are intended to 

narrowly address claims related to the bankruptcy and the Debtors' restructuring 

and any made whole claims that may be asserted relating to the 2017 and 2018 

wildfires by individual plaintiffs who elect to settle their claims against the 

Debtors or a post-effective date trust (individually or as a group). There is no 

intention to impose a release of ordinary-course insurance claims by insureds 

arising under their insurance policies. 

Second. The Ad Hoc Subrogation Group would support revising the Debtors' plan 

to require claimants to opt-in to releases, consistent with the Bondholders/TCC's 

plan, at least with respect to any release of subrogation claimants under the plan. 

Third. Per section 3(a)(iii) of the RSA, payments to individual holders of wildfire 

claims that settle their claims against the Debtors or a post-effective date trust 

(individually or as a group) will be conditioned on executing a release of any 

made whole claims against insurers and their assignees. Individual plaintiffs that 

litigate their claims to judgment will have no such requirement. We expect to 

work with the TCC to ensure the form release is drafted to narrowly address only 

its intended purpose. 

4. RSA Amendments: material RSA amendments will be noticed to the Court and parties in

interest with an opportunity to respond, to make sure any material adjustment to the

settlement passes muster under the applicable legal standard.

CC: Stephen Karotkin, Esq. 

Kevin Orsini, Esq. 

Ad Hoc Subrogation Group Steering Committee 

NEWYORK W\SIIINGTON IIOUSTON P\LCL\LTO P\RIS LONDON FR.\NKFURT BRUSSELS ill!L\N R OME Case: 19-30088 Doc# 4339-1 Filed: 10/21/19 Entered: 10/21/19 12:47:15 Page 4

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