| ITEM 2.03. | CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT. |
As previously reported, on January 28, 2022, Oncor Electric Delivery Company LLC (“Oncor”) entered into a Term Loan Credit Agreement (the “Term Loan Agreement”) among Oncor, as borrower, the lenders listed therein (the “Lenders”), PNC Bank, National Association (“PNC”), as administrative agent for the Lenders and as a Lender, and the other financial institutions party thereto. The Term Loan Agreement, which matures on April 29, 2023, provides for a term loan credit facility in an aggregate principal amount of $1.3 billion. Oncor may borrow up to the full amount of the term loan credit facility in up to four borrowings, which may be made, at Oncor’s option, at any time before April 28, 2022. Oncor previously borrowed $400 million on January 28, 2022 and $600 million on February 28, 2022 under the Term Loan Agreement.
On March 28, 2022, Oncor borrowed an additional $185 million under the Term Loan Agreement. As a result, Oncor has borrowed $1.185 billion aggregate principal amount of the $1.3 billion aggregate principal amount available under the Term Loan Agreement. Oncor used the proceeds for general corporate purposes, including repayment of outstanding commercial paper notes. Loans under the Term Loan Agreement bear interest, at Oncor’s option, at either (i) an adjusted term secured overnight financing rate (“SOFR”) (calculated based on one-month term SOFR as of a specified date, plus an adjustment of 0.10% (the “SOFR Adjustment”)) plus a spread of 0.575%, (ii) an adjusted daily simple SOFR (calculated based on daily simple SOFR as of a specified date, plus the SOFR Adjustment) plus a spread of 0.575%, or (iii) for any day, at a rate equal to the greatest of: (1) the prime rate publicly announced by PNC on such date, (2) the federal funds effective rate on such date plus 0.50%, and (3) daily simple SOFR on such date, plus 1%.
Additional details regarding the Term Loan Agreement are contained in Item 1.01 and Item 2.03 of Oncor’s Current Report on Form 8-K filed with the Securities and Exchange Commission on January 28, 2022 (“Prior 8-K”) and are incorporated herein by reference. The foregoing discussion of the terms of the Term Loan Agreement is not complete and is subject to, and qualified in its entirety by reference to, the Term Loan Agreement filed as Exhibit 10.1 to the Prior 8-K.
