Subject to the terms and conditions in the underwriting agreement among us, PG&E and the underwriters, for whom Goldman Sachs & Co. LLC and Citigroup Global Markets Inc. are acting as representative, we have agreed to sell to the underwriters, and the underwriters have severally agreed to purchase, the principal amount of the bonds listed opposite each underwriter’s name below:
| | | | | | | | | | | | |
Underwriter | | Tranche A-1 | | | Tranche A-2 | | | Tranche A-3 | |
Goldman Sachs & Co. LLC | | $ | 119,758,000 | | | $ | 72,140,000 | | | $ | 195,284,000 | |
Citigroup Global Markets Inc. | | $ | 93,145,000 | | | $ | 56,109,000 | | | $ | 151,887,000 | |
Barclays Capital Inc. | | $ | 13,306,000 | | | $ | 8,015,000 | | | $ | 21,698,000 | |
Academy Securities, Inc. | | $ | 13,306,000 | | | $ | 8,015,000 | | | $ | 21,698,000 | |
CastleOak Securities, L.P. | | $ | 13,306,000 | | | $ | 8,015,000 | | | $ | 21,698,000 | |
Siebert Williams Shank & Co., LLC | | $ | 13,306,000 | | | $ | 8,015,000 | | | $ | 21,698,000 | |
Total | | $ | 266,127,000 | | | $ | 160,309,000 | | | $ | 433,963,000 | |
The underwriters may allow, and dealers may reallow, a discount not to exceed the percentage listed below for each tranche:
| | | | | | | | |
| | | Selling Concession | | | Reallowance Discount | |
Tranche A-1 | | | 0.240 | % | | | 0.120 | % |
Tranche A-2 | | | 0.240 | % | | | 0.120 | % |
Tranche A-3 | | | 0.240 | % | | | 0.120 | % |
After the initial public offering, the public offering prices, selling concessions and reallowance discounts may change.
WEIGHTED AVERAGE LIFE SENSITIVITY
| | | | | | | | | | | | | | | | |
| | | Expected Weighted
Average Life (Years) | | | -5%
(2.87 Standard
Deviations from Mean) | | -15%
(11.16 Standard
Deviations from Mean) |
| Tranche | | WAL (yrs) | | | Change (days)* | | WAL (yrs) | | | Change (days)* |
A-1 | | | 4.99 | | | | 4.99 | | | 0 | | | 4.99 | | | 0 |
A-2 | | | 11.99 | | | | 11.99 | | | 0 | | | 11.99 | | | 0 |
A-3 | | | 19.93 | | | | 19.93 | | | 0 | | | 19.93 | | | 0 |
| * | Number is rounded to whole days |
Assumptions
For the purposes of preparing the above chart, the following assumptions, among others, have been made: (i) in relation to the initial forecast, the forecast error stays constant over the life of the bonds and is equal to an overestimate of electricity consumption of 5% (2.87 standard deviations from mean) or 15% (11.16 standard deviations from mean), (ii) the servicer makes timely and accurate submissions to true-up the fixed recovery charges annually, (iii) consumer write-off rates are held constant at 0.34% for all FRC consumer classes, (iv) PG&E remits fixed recovery charges on average 40 days after such charges are billed, (v) operating expenses are equal to projections, (vi) there is no acceleration of the final maturity date of the bonds, (vii) a permanent loss of all consumers has not occurred, and (viii) the issuance date of the bonds is November 12, 2021. There can be no assurance that the weighted average lives of the bonds will be as shown.
Pacific Gas and Electric Company and the Issuing Entity have filed a registration statement (including a prospectus) with the Securities and Exchange Commission (“SEC”) for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents Pacific Gas and Electric Company and the Issuing Entity have filed with the SEC as exhibits to the registration statement for more complete information about the Issuing Entity and this offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, Pacific Gas and Electric Company, the Issuing Entity, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by calling Goldman Sachs & Co. LLC toll-free at 1-866-471-2526 or Citigroup Global Markets Inc. toll-free at 1-800-831-9146.
