UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 13D

Under the Securities Exchange Act of 1934

 

 

PG&E Corporation

(Name of Issuer)

Common Stock, no par value

(Title of Class of Securities)

69331C108

(CUSIP Number)

Steven Siegler

Redwood Capital Management, LLC

910 Sylvan Ave, Suite 130

Englewood Cliffs, New Jersey 07632

(201) 227-5040

(Name, Address and Telephone Number of Person

Authorized to Receive Notices and Communications)

March 8, 2019

(Date of Event Which Requires Filing of This Statement)

 

 

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box  ☐.

 

 

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See § 240.13d-7 for other parties to whom copies are to be sent.

 

 

 

*	The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

 

 

 

CUSIP No. 69331C108

Page 2 of 11 Pages

 

1		NAME OF REPORTING PERSON   Redwood Capital Management, LLC
2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (1) (a)  ☒        (b)  ☐
3		SEC USE ONLY
4		SOURCE OF FUNDS   AF
5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)   ☐
6		CITIZENSHIP OR PLACE OF ORGANIZATION   Delaware

NUMBER OF SHARES BENEFICIALLY   OWNED BY EACH REPORTING PERSON WITH				7		SOLE VOTING POWER   0
				8		SHARED VOTING POWER   14,200,197 (2)
				9		SOLE DISPOSITIVE POWER   0
				10		SHARED DISPOSITIVE POWER   14,200,197 (2)

11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON   14,200,197
12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES  ☐
13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)   2.69%
14		TYPE OF REPORTING PERSON   IA, OO

 

(1)	See Item 4.

(2)	See Item 5.

CUSIP No. 69331C108

Page 3 of 11 Pages

 

Item 1.

Security and Issuer.

This statement of beneficial ownership on Schedule 13D (this “Schedule 13D”) is filed on behalf of Redwood Capital Management, LLC, a Delaware limited liability company (the “Reporting Person”). This Schedule 13D relates to the shares of common stock, no par value (the “Shares”), of PG&E Corporation, a California corporation (the “Company”). The address of the principal executive offices of the Company is 77 Beale Street, P.O. Box 770000, San Francisco, California 94177.

 

Item 2.

Identity and Background.

 

(a)

This Schedule 13D is filed by the Reporting Person with respect to the Shares beneficially owned by it.

 

(b)

The address of the principal executive office of the Reporting Person is 910 Sylvan Ave, Suite 130, Englewood Cliffs, New Jersey 07632.

 

(c)

The principal business of the Reporting Person is providing investment management services to the private investment vehicles and accounts for which the Reporting Person serves as investment manager.

 

(d)

During the past five years, neither the Reporting Person nor any director, executive officer or controlling person of the Reporting Person has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

 

(e)

During the past five years, neither the Reporting Person nor any director, executive officer or controlling person of the Reporting Person has been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting, or mandating activities subject to, federal or state securities laws or a finding of any violation with respect to such laws.

As described in Item 4, the Reporting Person may be deemed to be a member of a group for the purposes of Section 13(d)(3) of Securities Exchange Act of 1934 (the “Act”) comprised of the Reporting Person and the Other Shareholders (as defined in Item 4). Each of the Other Shareholders has agreed to file a separate statement of beneficial ownership on Schedule 13D pursuant to Rule 13d-1(k)(2) under the Act containing its required information. The Reporting Person assumes no responsibility for the information contained in such Schedule 13D’s filed by Other Shareholders. The Reporting Person expressly disclaims beneficial ownership of any securities beneficially owned or acquired by any Other Shareholder.

 

Item 3.

Source and Amount of Funds or Other Consideration.

The Shares reported herein as being beneficially owned by the Reporting Person were purchased using working capital of Redwood Drawdown Master Fund II, L.P. and Redwood Master Fund, Ltd. (collectively, the “Redwood Funds”) in open-market transactions. A total of $199.8 million was paid to acquire the Shares reported in this Schedule 13D, excluding brokerage commissions.

 

Item 4.

Purpose of Transaction.

The Reporting Person, solely through the Redwood Funds, beneficially owns 14,200,197 Shares, which represent 2.69% of the outstanding Shares based on published information. All Shares so owned by the Reporting Person were purchased and are beneficially owned for investment purposes.

CUSIP No. 69331C108

Page 4 of 11 Pages

 

The Company has publicly announced that it is conducting a process for the refreshment of its board of directors (the “Board”) and that it anticipates that a majority of the Board will be new independent directors prior to the Company’s 2019 annual meeting of shareholders. The Company has also publicly announced that it is conducting a process to identify a permanent CEO to lead the Company.

From time to time, representatives of the Reporting Person have conducted discussions with representatives of the Company and other parties with respect to the Company’s bankruptcy case and these processes. On March 8, 2019, the Reporting Person and two other shareholders, Knighthead Capital Management, LLC, a Delaware limited liability company, and Abrams Capital Management, L.P., a Delaware limited partnership (together, the “Other Shareholders”), had an initial joint conference call, together with financial advisers and counsel, to discuss the status of discussions with representatives of the Company regarding the Board refreshment and CEO selection processes. During their telephone conference, each of the Reporting Person and the Other Shareholders mutually agreed to act in concert to submit director candidate nominations to the Company if they collectively determined nominations to be appropriate.

On March 15, 2019, the Reporting Person entered into a letter agreement (the “Investor Agreement”), a copy of which is filed as Exhibit 99.1 hereto, with the Other Shareholders, in respect of the Company’s Board refreshment and CEO selection processes. This Investor Agreement memorialized the parties’ determination on March 8, 2019 that they expected to work in concert for what they expected to be a brief period in relation to these matters. Unless the Reporting Person withdraws from the Investor Agreement (which it may do at any time), the Reporting Person expects to act with respect to any such matter in accordance with the agreement or consensus of at least two of the three parties to the Investor Agreement. As such, the Reporting Person and the Other Shareholders may be deemed to constitute a group for purposes of Rule 13d-3 under the Act.

Based on information provided by the Other Shareholders, the Reporting Person believes that it and the Other Shareholders beneficially own in the aggregate 9.83% of the outstanding Shares as of the date of this Schedule 13D. Depending on the outcome of discussions with the Company, the Reporting Person (with or without one or both of the Other Shareholders) may submit proposed nominees for election to the Board under the Company’s director nomination bylaws, although it has not decided to do so as of the date of this Schedule 13D.

Except as set forth above, as of the date of this Schedule 13D, the Reporting Person and, to its knowledge, the Other Shareholders have no plans or proposals that relate to or would result in any matter referred in items (a) through (j) of Item 4 of Schedule 13D.

Depending on market conditions and other factors, including developments in the Company’s bankruptcy case, the Redwood Funds may sell Shares in the open market or in privately negotiated transactions or purchase or sell cash-settled derivatives, the value of which is measured by changes in trading prices of the Shares. The Investor Agreement prohibits purchases of additional Shares. Accordingly, such purchases by the Reporting Person would require the consent of at least two of the three parties to the Investor Agreement or would require the Reporting Person to withdraw therefrom.

The Reporting Person also reserves the sole right to vote the Shares it beneficially owns or to take any other action with respect to such Shares. The Reporting Person and each Other Shareholder have expressly represented and agreed that they have no other written or oral agreement or understanding with respect to the Shares and expressly reserve the right for any reason or no reason to act independently with respect to the Company or their investment in it. The Reporting Person reserves the right to change its plans and make any proposal, either alone or with others, at any time.

The Reporting Person presently expects to terminate the Investor Agreement upon the Company’s election of a refreshed Board and selection of a permanent CEO acceptable to the Reporting Person. The Reporting Person reserves the right to terminate the Investor Agreement earlier or later, and to take any other action, alone or with others.

CUSIP No. 69331C108

Page 5 of 11 Pages

 

Item 5.

Interest in Securities of the Issuer.

The aggregate percentage of Shares reported owned by the Reporting Person is based upon 527,561,429 Shares outstanding, as of February 22, 2019, which is the total number of Shares outstanding as reported in the Company’s Annual Report on Form 10-K filed with the SEC on February 28, 2019.

The Reporting Person may be deemed to share voting and investment power with (1) Redwood Drawdown Partners II, LLC, a Delaware limited liability company (“Redwood Partners”), (2) Redwood Capital Management Holdings, LP, a Delaware limited partnership (“Redwood Holdings LP”), (3) Redwood Capital Management Holdings GP, LLC, a Delaware limited liability company (“Redwood GP LLC”), (4) Little Mission Creek Corp., a New Jersey corporation (“Mission Creek”), and (5) Jonathan Kolatch (together with Redwood Partners, Redwood Holdings LP, Redwood GP LLC and Mission Creek, the “Controlling Persons”).

 

(a)

The business address of each of Redwood Partners, Redwood Holding LP and Redwood GP LLC is c/o Redwood Capital Management, LLC, 910 Sylvan Ave, Suite 130, Englewood Cliffs, New Jersey 07632. The address of each of Mission Creek and Mr. Kolatch is c/o Redwood Capital Management, LLC, 404 Washington Avenue, Suite 715, Miami Beach, Florida 33139.

 

(b)

Redwood Partners serves as the general partner of Redwood Drawdown Master Fund II, L.P. Redwood Holdings LP is the sole member of the Reporting Person. Redwood GP LLC serves as general partner of Redwood Holdings LP. Mission Creek is the managing member of Redwood GP LLC. Mr. Kolatch is the sole owner and director of Mission Creek.

 

(c)

None of the Controlling Persons has, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

 

(d)

None of the Controlling Persons has, during the last five years, been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

 

(e)

Mr. Kolatch is a citizen of the United States of America.

Shares reported herein for the Reporting Person represent Shares owned by the Redwood Funds for which the Reporting Person serves as investment manager. Shares reported herein for the Controlling Persons represent the above referenced shares reported for the Reporting Person.

 

(a)

As of the close of business on March 15, 2019, the Reporting Person and each of the Controlling Persons beneficially owned 14,200,197 Shares. Percentage: 2.69%

 

The Reporting Person also has sold put options covering an aggregate total of 100,000 Shares at a strike price of $12.00, which put options have an expiry date of April 18, 2019. Thus, the Reporting Person has no control over whether these options will be exercised and whether it will be required to purchase the Shares.

 

(b)

1. Sole power to vote or direct vote: 0

2. Shared power to vote or direct vote: 14,200,197

3. Sole power to dispose or direct the disposition: 0

4. Shared power to dispose or direct the disposition: 14,200,197

CUSIP No. 69331C108

Page 6 of 11 Pages

 

(c)

Transactions in the Shares by the Reporting Person, through the Redwood Funds, during the past 60 days are set forth in Schedule A and are incorporated herein by reference.

 

(d)

Except as described in Item 5 of this Schedule 13D, to the knowledge of the Reporting Person, no person other than the Reporting Person is known to have the right to receive, or the power to direct the receipt of dividends from, or proceeds from the sale of, the Shares beneficially owned by the Reporting Person.

 

(e)

Not applicable.

 

Item 6.

Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

Items 4 and 5 hereof are incorporated by reference in their entirety. Other than as described herein, there are no contracts, arrangements, understandings or relationships among the Reporting Person and the Other Shareholders, or between each of the foregoing and any other person, with respect to the securities of the Company.

 

Item 7.

Materials to be Filed as Exhibits.

 

99.1*

Investor Agreement, dated March 15, 2019, by and among Abrams Capital Management, L.P., Redwood Capital Management Holdings, LP and Knighthead Capital Management, LLC.

 

*	Filed herewith.

CUSIP No. 69331C108

Page 7 of 11 Pages

 

SIGNATURES

After reasonable inquiry and to the best of his knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct.

Dated: March 15, 2019

 

CUSIP No. 69331C108

Page 8 of 11 Pages

 

SCHEDULE A

Transactions in Shares During the Past 60 Days*

 

Number of Shares Purchased/(Sold)				Price ($)				Date of Purchase/Sale		Transacting Entity
	(11,530	)			17.5945			01/11/2019		Redwood Master Fund, Ltd
	100	**			37.7105			01/14/2019		Redwood Master Fund, Ltd
	62,805				8.5088			01/14/2019		Redwood Master Fund, Ltd
	94,206				9.1124			01/14/2019		Redwood Master Fund, Ltd
	125,609				9.1755			01/14/2019		Redwood Master Fund, Ltd
	157,007				9.1341			01/14/2019		Redwood Master Fund, Ltd
	157,008				9.2043			01/14/2019		Redwood Master Fund, Ltd
	157,009				9.2499			01/14/2019		Redwood Master Fund, Ltd
	157,010				9.1858			01/14/2019		Redwood Master Fund, Ltd
	251,211				8.8035			01/14/2019		Redwood Master Fund, Ltd
	148,789				8.80			1/14/2019		Redwood Drawdown Master Fund II, LP
	92,993				9.13			1/14/2019		Redwood Drawdown Master Fund II, LP
	92,992				9.20			1/14/2019		Redwood Drawdown Master Fund II, LP
	92,991				9.25			1/14/2019		Redwood Drawdown Master Fund II, LP
	55,794				9.11			1/14/2019		Redwood Drawdown Master Fund II, LP
	92,990				9.19			1/14/2019		Redwood Drawdown Master Fund II, LP
	74,391				9.18			1/14/2019		Redwood Drawdown Master Fund II, LP
	37,195				8.51			1/14/2019		Redwood Drawdown Master Fund II, LP
	16,027				6.4447			01/15/2019		Redwood Master Fund, Ltd
	19,802				6.0950			01/15/2019		Redwood Master Fund, Ltd
	96,626				6.2738			01/15/2019		Redwood Master Fund, Ltd
	128,312				6.5316			01/15/2019		Redwood Master Fund, Ltd
	256,618				6.4928			01/15/2019		Redwood Master Fund, Ltd
	280,639				6.7309			01/15/2019		Redwood Master Fund, Ltd
	365,688				6.3520			01/15/2019		Redwood Master Fund, Ltd
	53,374				6.27			1/15/2019		Redwood Drawdown Master Fund II, LP
	71,688				6.53			1/15/2019		Redwood Drawdown Master Fund II, LP
	204,312				6.35			1/15/2019		Redwood Drawdown Master Fund II, LP
	143,382				6.49			1/15/2019		Redwood Drawdown Master Fund II, LP
	156,808				6.73			1/15/2019		Redwood Drawdown Master Fund II, LP
	8,973				6.44			1/15/2019		Redwood Drawdown Master Fund II, LP
	17,327				6.7555			01/16/2019		Redwood Master Fund, Ltd
	64,281				6.3198			01/16/2019		Redwood Master Fund, Ltd
	160,703				6.7128			01/16/2019		Redwood Master Fund, Ltd

CUSIP No. 69331C108

Page 9 of 11 Pages

 

	160,703				6.5600			01/16/2019		Redwood Master Fund, Ltd
	160,703				6.6375			01/16/2019		Redwood Master Fund, Ltd
	162,513				7.0198			01/16/2019		Redwood Master Fund, Ltd
	321,407				6.6276			01/16/2019		Redwood Master Fund, Ltd
	35,719				6.32			1/16/2019		Redwood Drawdown Master Fund II, LP
	178,593				6.63			1/16/2019		Redwood Drawdown Master Fund II, LP
	89,297				6.64			1/16/2019		Redwood Drawdown Master Fund II, LP
	89,297				6.56			1/16/2019		Redwood Drawdown Master Fund II, LP
	89,297				6.71			1/16/2019		Redwood Drawdown Master Fund II, LP
	87,487				7.02			1/16/2019		Redwood Drawdown Master Fund II, LP
	(9,901	)			8.0069			01/17/2019		Redwood Master Fund, Ltd
	9,901				7.2985			01/17/2019		Redwood Master Fund, Ltd
	37,129				6.7222			01/17/2019		Redwood Master Fund, Ltd
	77,450				6.9655			01/17/2019		Redwood Master Fund, Ltd
	385,854				7.2067			01/17/2019		Redwood Master Fund, Ltd
	1,326,601				6.3600			01/17/2019		Redwood Master Fund, Ltd
	22,550				6.97			1/17/2019		Redwood Drawdown Master Fund II, LP
	114,146				7.21			1/17/2019		Redwood Drawdown Master Fund II, LP
	423,399				6.36			1/17/2019		Redwood Drawdown Master Fund II, LP
	11,100	**			41.6894			01/18/2019		Redwood Master Fund, Ltd
	34,654				7.0657			01/18/2019		Redwood Master Fund, Ltd
	36,472				6.4488			01/18/2019		Redwood Master Fund, Ltd
	39,604				6.8266			01/18/2019		Redwood Master Fund, Ltd
	62,800	**			35.5808			01/18/2019		Redwood Master Fund, Ltd
	80,238				6.6992			01/18/2019		Redwood Master Fund, Ltd
	102,120				7.0090			01/18/2019		Redwood Master Fund, Ltd
	231,000	**			7.6105			01/18/2019		Redwood Master Fund, Ltd
	240,400	**			37.1336			01/18/2019		Redwood Master Fund, Ltd
	13,528				6.45			1/18/2019		Redwood Drawdown Master Fund II, LP
	29,762				6.70			1/18/2019		Redwood Drawdown Master Fund II, LP
	37,880				7.01			1/18/2019		Redwood Drawdown Master Fund II, LP
	69,000	**			7.61			1/18/2019		Redwood Drawdown Master Fund II, LP
	(9,901	)			7.9327			01/22/2019		Redwood Master Fund, Ltd
	9,901				7.6143			01/22/2019		Redwood Master Fund, Ltd
	(55,446	)			13.6849			01/24/2019		Redwood Master Fund, Ltd
	(19,802	)			12.8113			01/24/2019		Redwood Master Fund, Ltd
	10,891				7.6713			01/24/2019		Redwood Master Fund, Ltd
	12,376				7.4359			01/24/2019		Redwood Master Fund, Ltd
	62,590				13.3667			01/24/2019		Redwood Master Fund, Ltd
	12,410				13.37			1/24/2019		Redwood Drawdown Master Fund II, LP
	(24,753	)			12.2559			01/25/2019		Redwood Master Fund, Ltd

CUSIP No. 69331C108

Page 10 of 11 Pages

 

	100,000				12.1999			01/25/2019		Redwood Master Fund, Ltd
	100,000				12.3942			01/25/2019		Redwood Master Fund, Ltd
	200,000				12.2509			01/25/2019		Redwood Master Fund, Ltd
	200,000				12.3921			01/25/2019		Redwood Master Fund, Ltd
	200,000				12.1718			01/25/2019		Redwood Master Fund, Ltd
	200,000				12.2857			01/25/2019		Redwood Master Fund, Ltd
	14,851				12.4513			01/28/2019		Redwood Master Fund, Ltd
	108,000				11.2098			01/28/2019		Redwood Master Fund, Ltd
	42,000				11.21			1/28/2019		Redwood Drawdown Master Fund II, LP
	(12,376)				13.7093			01/29/2019		Redwood Master Fund, Ltd
	24,753				11.2497			01/29/2019		Redwood Master Fund, Ltd
	53,250				13.7899			01/29/2019		Redwood Master Fund, Ltd
	76,697				13.8852			01/29/2019		Redwood Master Fund, Ltd
	163,300				13.5584			01/29/2019		Redwood Master Fund, Ltd
	66,700				13.56			1/29/2019		Redwood Drawdown Master Fund II, LP
	21,750				13.79			1/29/2019		Redwood Drawdown Master Fund II, LP
	31,327				13.89			1/29/2019		Redwood Drawdown Master Fund II, LP
	11,834				13.6655			01/30/2019		Redwood Master Fund, Ltd
	35,537				13.5641			01/30/2019		Redwood Master Fund, Ltd
	71,075				13.5099			01/30/2019		Redwood Master Fund, Ltd
	71,075				13.5769			01/30/2019		Redwood Master Fund, Ltd
	88,844				13.5469			01/30/2019		Redwood Master Fund, Ltd
	177,687				13.4905			01/30/2019		Redwood Master Fund, Ltd
	195,456				13.4324			01/30/2019		Redwood Master Fund, Ltd
	72,313				13.49			1/30/2019		Redwood Drawdown Master Fund II, LP
	28,925				13.51			1/30/2019		Redwood Drawdown Master Fund II, LP
	14,463				13.56			1/30/2019		Redwood Drawdown Master Fund II, LP
	28,925				13.58			1/30/2019		Redwood Drawdown Master Fund II, LP
	36,156				13.55			1/30/2019		Redwood Drawdown Master Fund II, LP
	79,544				13.43			1/30/2019		Redwood Drawdown Master Fund II, LP
	5,917				13.4935			01/31/2019		Redwood Master Fund, Ltd
	5,917				13.0964			02/01/2019		Redwood Master Fund, Ltd
	(2,901	)			13.0145			02/04/2019		Redwood Master Fund, Ltd
	8,798				12.9493			02/04/2019		Redwood Master Fund, Ltd
	11,793				14.4348			02/11/2019		Redwood Master Fund, Ltd
	(142,150	)			15.8008			02/13/2019		Redwood Master Fund, Ltd
	(117,753	)**			15.8618			02/13/2019		Redwood Master Fund, Ltd
	(47,922	)			15.86			2/13/2019		Redwood Drawdown Master Fund II, LP
	(57,850	)			15.80			2/13/2019		Redwood Drawdown Master Fund II, LP
	(71,075	)			15.5400			02/14/2019		Redwood Master Fund, Ltd
	(28,925	)			15.54			2/14/2019		Redwood Drawdown Master Fund II, LP

CUSIP No. 69331C108

Page 11 of 11 Pages

 

	(569	)			15.6400			02/15/2019		Redwood Master Fund, Ltd
	(231	)			15.64			2/15/2019		Redwood Drawdown Master Fund II, LP
	(426,449	)			16.5682			02/19/2019		Redwood Master Fund, Ltd
	(4,011	)			18.1699			02/19/2019		Redwood Master Fund, Ltd
	(173,551	)			16.57			2/19/2019		Redwood Drawdown Master Fund II, LP
	(4,011	)			18.0341			02/20/2019		Redwood Master Fund, Ltd
	(16,042	)			19.6148			02/21/2019		Redwood Master Fund, Ltd
	(16,042	)			19.6557			02/21/2019		Redwood Master Fund, Ltd
	(12,031	)			19.6523			02/21/2019		Redwood Master Fund, Ltd
	(100,000	)			19.51			2/21/2019		Redwood Drawdown Master Fund II, LP
	(13,400	)			19.88			2/22/2019		Redwood Drawdown Master Fund II, LP
	2,005				17.8464			02/27/2019		Redwood Master Fund, Ltd
	6,584				17.2354			02/28/2019		Redwood Master Fund, Ltd
	9,682				18.0409			03/04/2019		Redwood Master Fund, Ltd

 

*	Except as otherwise indicated, all transactions were open-market purchases effected through brokers.

**	Represents Shares underlying exchange-listed options sold short that were assigned.

Exhibit 99.1

March 15, 2019

Ladies and Gentlemen:

This memorializes the agreement (the “Agreement”) of the undersigned investment managers and/or advisers of shareholders (each, together with its managed funds and accounts and other affiliates, a “Party” and collectively the “Parties”) of PG&E Corp. (the “Company”), determination on March 8, 2019 to work in concert with respect to the Parties’ participation in the Company’s previously announced Board of Directors (the “Board”) refreshment and CEO selection processes, as follows:

(a)    Interest in Equity Securities. (i) Each Party represents and warrants to the other Parties that, as of the date of this Agreement, it beneficially owns (as that term is defined in SEC Rule 13d-3 (“Beneficial Ownership”)) the number of shares of equity securities, in each case, of the Company or Pacific Gas and Electric Company (“OpCo”) set forth on the signature page hereto. Each Party will as promptly as practicable, and in any event, within one day, notify the other Parties of any change in its Beneficial Ownership of equity securities of the Company or OpCo.

(ii)    Unless otherwise agreed by the other Parties, unless a Party has withdrawn from this Agreement pursuant to paragraph (g) or this Agreement has been terminated pursuant to paragraph (f), no Party will increase, and each Party will prevent any funds managed or controlled by it from increasing, its Beneficial Ownership of equity securities of the Company or OpCo; provided, however, that nothing herein prevents any Party or any of its managed or controlled funds from selling any debt or equity securities of the Company or OpCo currently held by such Party or its managed or controlled funds or entering into, purchasing or selling cash-settled derivatives relating to such securities so long as so doing is in compliance with law and such transactions do not result in any increase in the number of Company or OpCo voting securities Beneficially Owned by such Party.

(b)    Board and CEO Refreshment Processes. The Company has announced processes to appoint, prior to the Company’s 2019 annual shareholders meeting, a majority of new independent directors and to select a permanent CEO (the “Processes”). The Parties agree to collaborate in good faith in respect of the Processes and not knowingly take any position in respect of the Processes not supported by at least one of the other two Parties.

(c)    Voting. Each Party reserves the sole right to vote any equity securities of the Company or OpCo Beneficially Owned by it in such manner as it determines in its sole discretion.

(d)    Regulatory Filings. Each Party will individually make and be solely responsible for any filings or notifications as may be necessary under applicable law in connection with the entry into this Agreement and the performance of its obligations hereunder.

(e)    Costs. All fees and expenses (other than filing fees, if any) will be borne by the Parties according to each Party’s Pro Rata Share. A Party’s “Pro Rata Share” will be calculated as a fraction equal to one divided by the total number of Parties. In the event a Party withdraws from this Agreement pursuant to paragraph (g) or this Agreement is otherwise terminated pursuant to paragraph (f), such Party will cease to have any further obligation for its Pro Rata Share of fees and expenses as provided in this paragraph (e) incurred through the 15th of the month, if such written notice is delivered to the other Parties prior to such date, or through the end of the month if such written notice is delivered to the other Parties after the 15th of the month or this Agreement is terminated pursuant to paragraph (f).

(f)    Termination. The Parties presently expect to terminate this Agreement upon the appointment or election of new directors to the Board and selection of the Company’s chief executive officer pursuant to the Processes. This Agreement will terminate without further action upon the earliest to occur of (i) a date mutually agreed by at least two of the Parties and (ii) the date two of the three Parties have withdrawn from this Agreement pursuant to paragraph (g). No termination of this Agreement pursuant to this paragraph (f) will relieve any Party from liability for any prior breach by such Party or responsibility for payment of costs and expenses as provided in paragraph (e).

(g)    Withdrawal. Any Party may withdraw from its obligations hereunder and terminate this Agreement as to itself and its managed or controlled funds for any reason or for no reason upon written notice to the other Parties, provided that no withdrawal pursuant to this paragraph (g) will relieve any such Party from liability for any prior breach by such Party or responsibility for payment of costs and expenses as provided in paragraph (e).

(h)    Entire Agreement. This Agreement constitutes the entire agreement among the Parties with respect to the subject matter hereof and the Parties expressly represent and agree that, except for this Agreement, the Parties do not have any written or oral agreement or understanding with respect to the debt or equity securities of the Company or OpCo.

(i)    Miscellaneous. This Agreement (i) may be executed in two or more counterparts, each of which will be considered to be an original but all of which will be considered to be the same agreement, and (ii) will be governed by the laws of the State of New York without regard to the conflict of laws principles that would cause the laws of another State to apply. Any proceeding in respect of this Agreement may only be initiated in U.S. District Court in the Southern District of New York or, if such court declines to accept jurisdiction, a New York state court located in the Borough of Manhattan.

(j)    Notices. Notices must be in writing and will be deemed given hereunder when delivered personally or sent by email (receipt confirmed) to the notice persons identified on the signature page hereto.

 

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By signing below, each Party agrees to be bound pursuant to and in accordance with the terms of this Agreement.

 

[Signature page to Letter Agreement]

[Signature page to Letter Agreement]

[Signature page to Letter Agreement]