Business Context and Reporting Period
Company: Southern California Edison Company (SCE)
Filing Type: Form 8-K (Current Report)
Date of Report: February 11, 2026
Event: Entry into a Material Definitive Agreement (Term Loan Credit Agreement).
Key Financial Metrics and Debt Structure
- New Debt Facility: Term Loan Credit Agreement for up to $300 million.
- Maturity Date: March 11, 2027.
- Interest Rate: Term SOFR + 1.00% or Base Rate + 0.0%.
- Prepayment Terms: Allowed in whole or in part at any time without premium or penalty.
- Financial Covenant: Consolidated total indebtedness to consolidated capital ratio must not exceed 0.65 to 1.0 at the end of each quarter.
- Existing Facilities: Lenders are also parties to SCE's $3.35 billion revolving credit facility and its parent Edison International's $1.5 billion revolving credit facility.
Note: This filing does not provide specific values for revenue, profit, cash flow, margins, or total liquidity positions.
Material Changes and Use of Proceeds
The primary material change is the establishment of the new $300 million term loan facility. SCE intends to use the proceeds for:
- General corporate purposes.
- Working capital needs.
- Potential repayment of existing debt.
Outlook, Risks, and Contingencies
Management Commentary: The agreement includes customary representations, warranties, covenants, and events of default. The filing notes that lenders have historically provided and may continue to provide investment banking and commercial banking services to SCE and its affiliates for customary compensation.
Risks: Compliance with the financial covenant (indebtedness to capital ratio) is a key contingency. Failure to maintain the required ratio could trigger an event of default.
Key Facts for Investor Verification
- Verify the current consolidated total indebtedness to consolidated capital ratio to ensure compliance with the new 0.65 to 1.0 covenant.
- Confirm the specific allocation of the $300 million proceeds between working capital and debt repayment.
- Review the full text of the Term Loan Agreement (Exhibit 10.1) for detailed covenants and events of default.
- Monitor interest rate exposure given the variable rate structure (SOFR + margin).