MODIFICATIONS TO D.02-11-030
All changes are shown in "strikethrough" (a) for deletions and "underscored" (a) for additions.
E. Interest-rate Swaps, Caps, and Collars
We order that in connection with the Amended Plan, PG&E may, with authority under § 701, enter into interest rate hedges interest rate swaps, caps and collars for long-term debt pursuant to this decision. [footnote 12] PG&E shall comply with all record keeping and reporting requirements pertaining to these financial instruments as were adopted by the Commission in D.93-06-082. PG&E shall comply with all record keeping and reporting requirements pertaining to these financial instruments as were adopted by the Commission in D.93-06-082. The authority to enter into interest rate hedges is effective upon issuance of this decision, and encompasses interest rate hedges for long-term debt to implement any plan of reorganization approved by the Bankruptcy Court and shall be negotiated jointly by PG&E with the concurrence of the Commission's Financing Team.
1. The Commission has modified its Original Plan and is now sponsoring the Amended Plan of Reorganization jointly with the Official Unsecured Creditors' Committee. In addition to the Commission Amended Plan, there are two other Plans of Reorganization pending before the Bankruptcy Court in PG&E's Chapter 11 proceeding.
2. The Commission's Plan currently requires up to $9.5 billion or less in new long-term debt and in proceeds from the sale of new preferred stock. The other two plans similarly would require new long-term debt to be issued in similar amounts to the Commission's Plan.
10. The proposed financing of any Bankruptcy Court approved plan the Amended Plan needs the flexibility derived from authority under § 701 to arrange financing that would have PG&E enter into interest-rate hedges swaps, caps, and collars for long-term debt issued pursuant to this decision. The Commission granted PG&E similar authority under § 701 in D.95-09-023, D.93-06-082, D.92-06-031, and D.88-04-063.
Change to Conclusion of Law 8 (b) and Addition of 8(g)
8. The following exemptions or allowances are reasonable, consistent with Commission precedent, and should be granted:
(b) The need for authority under § 701 to enter into interest-rate hedges swaps, caps, and collars for long-term debt issued pursuant to this decision decisions in this proceeding.
(g) To exempt interest rate hedges entered into to finance a bankruptcy Court approved plan from any volumetric restriction or limit that may otherwise apply as a result of another Commission decision.
Changes to Ordering Paragraph 5
Pursuant to Pub. Util. Code § 701, PG&E, only with the concurrence of the Commission's Financing Team, is authorized to enter interest rate hedges into interest-(including without limit other than in this decision, interest rate swaps, caps, and collars, floors, forwards, forward swaps, options, puts and calls) for debt issued pursuant to this decision to implement any Bankruptcy Court approved plan. PG&E shall comply with all record keeping and reporting requirements pertaining to these financial instruments that were adopted by the Commission in Decision (D.) 93-06-082. The interest rate hedges and interest-rate swaps authorized herein shall not be considered as additional debt for the purpose of determining the amount of long-term debt issued by PG&E.
(END OF APPENDIX A)
