Click here to close now.


News Feed Item

PREPA Reaches Agreements with Creditors

SAN JUAN, Puerto Rico, Aug. 14, 2014 /PRNewswire-USNewswire/ -- The Puerto Rico Electric Power Authority ("PREPA") today announced that discussions with its creditors have resulted in agreements that provide PREPA with a consensual path forward to improve its operations and financial situation.

Insurers and bondholders controlling more than 60 percent of PREPA's outstanding bonds have entered into contractual arrangements and agreed to amend the existing bond documents to provide PREPA with liquidity and time to work with its creditors to develop a plan to achieve a restructuring of its business.

The insurers and bondholders who signed the agreements, including those that have commenced litigation against the Debt Enforcement and Recovery Act, have agreed that they will not exercise remedies against PREPA during the term of these agreements.  During this period, PREPA will continue to make required debt service payments in full.

The banks that provide revolving lines of credit used to pay for purchased power, fuel and other expenses have agreed to extend until March 31, 2015 their previously announced agreements to not exercise remedies as a result of certain credit downgrades and other events. These agreements allow PREPA to continue to delay certain payments that were due to these lenders in July and August, respectively, until March 31, 2015. During this period, the banks will receive interest payments on these amounts.

The contractual agreements with PREPA's insurers, bondholders and banks will go into effect immediately and an amendment to the existing bond documents, which will provide PREPA the ability to use approximately $280 million held in its construction fund for payment of current expenses and capital improvements, will become effective later this month. The additional liquidity will assist PREPA in its ongoing operations, while also keeping funds available for capital improvements that will help to facilitate cleaner and more efficient fuel delivery, enabling Puerto Rico to achieve the targets established in the Energy Reform Act.

As part of the new agreements, GDB has agreed that it will not exercise set off rights with respect to PREPA deposits and will not require PREPA to make principal or interest payments due under GDB loans.

"Today's announcement is an important milestone in the transformation of PREPA and gives us a clear line of sight to the future," said Harry Rodriguez, President of PREPA's Board of Directors. "PREPA is working hard to deliver with infrastructure improvements, better cost controls and improved service.  Today's agreements give us additional tools toward the creation of a more modern and self-sustaining PREPA for the future."

Juan F. Alicea Flores, executive director for PREPA, stated, "Today's agreements give PREPA the additional time and financial resources we need to reach a comprehensive solution that ensures our ability to provide a safe, reliable and efficient power supply to all Puerto Ricans for many years to come. It is the result of a lot of hard work by many people, and I want to thank all of our stakeholders for their contributions to this very positive outcome."

David H. Chafey, president of the Board of Directors of GDB, commented, "The Government Development Bank of Puerto Rico is pleased with  PREPA's ongoing efforts to become a self-sustaining business. The agreements announced today are important steps in the process of creating a stronger PREPA for the people of Puerto Rico."

As part of its agreements with the creditors group, PREPA has committed to complete a five-year business plan by December 15, 2014 and to appoint a chief restructuring officer (CRO) by September 8, 2014.  The CRO will work closely with Mr. Alicea and the rest of PREPA's Board and management team to accelerate PREPA's transformation, ensuring the utility is able to efficiently implement the changes necessary to achieve its financial and operating targets. Initial areas of focus are expected to include optimizing the generation, transmission and distribution of the Island's power supply, refining collection and expense management processes, and enhancing the overall quality of data collection and reporting.  Under the terms of the agreements announced today, PREPA must deliver a full debt restructuring plan by March 2, 2015.

"The additional insights and experiences the CRO will bring to PREPA will be important assets as we work to build a stronger utility for the future," Mr. Alicea added.

PREPA will file a notice on the Electronic Municipal Market Access (EMMA) system outlining the key terms of its agreements with the creditor groups. PREPA agreed to make these disclosures under confidentiality agreements it signed with certain of its creditors in conjunction with the ongoing discussions. The notice will be filed today and includes additional information about the agreements and PREPA.

SOURCE Puerto Rico Electric Power Authority

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
Interested in leveraging automation technologies and a cloud architecture to make developers more productive? Learn how PaaS can benefit your organization to help you streamline your application development, allow you to use existing infrastructure and improve operational efficiencies. Begin charting your path to PaaS with OpenShift Enterprise.
Decisions about budgets and resources are often made without IT even having a seat at the table. As technologist we understand the value of DevOps - but do your business counterparts? If they don't, your DevOps initiatives could lose funding before they start. In her session at DevOps Summit, Jeanne Morain, Strategist / Author at iSpeak Cloud, LLC, will provide insights on how to bridge the gap between business and technology leaders. Attendees will learn prescriptive guidance on balancing wor...
Organizations already struggle with the simple collection of data resulting from the proliferation of IoT, lacking the right infrastructure to manage it. They can't only rely on the cloud to collect and utilize this data because many applications still require dedicated infrastructure for security, redundancy, performance, etc. In his session at 17th Cloud Expo, Emil Sayegh, CEO of Codero Hosting, will discuss how in order to resolve the inherent issues, companies need to combine dedicated a...
The modern software development landscape consists of best practices and tools that allow teams to deliver software in a near-continuous manner. By adopting a culture of automation, measurement and sharing, the time to ship code has been greatly reduced, allowing for shorter release cycles and quicker feedback from customers and users. Still, with all of these tools and methods, how can teams stay on top of what is taking place across their infrastructure and codebase? Hopping between services a...
For almost two decades, businesses have discovered great opportunities to engage with customers and even expand revenue through digital systems, including web and mobile applications. Yet, even now, the conversation between the business and the technologists that deliver these systems is strained, in large part due to misaligned objectives. In his session at DevOps Summit, James Urquhart, Senior Vice President of Performance Analytics at SOASTA, Inc., will discuss how measuring user outcomes –...
Clearly the way forward is to move to cloud be it bare metal, VMs or containers. One aspect of the current public clouds that is slowing this cloud migration is cloud lock-in. Every cloud vendor is trying to make it very difficult to move out once a customer has chosen their cloud. In his session at 17th Cloud Expo, Naveen Nimmu, CEO of Clouber, Inc., will advocate that making the inter-cloud migration as simple as changing airlines would help the entire industry to quickly adopt the cloud wit...
While testing is often ignored when it comes to DevOps - it could be the most important aspect of achieving true DevOps success. Without rethinking automated testing from the ground-up, the entire DevOps productivity gain cannot be realized. Large tech companies build their own rapid test automation that runs in minutes across functional, performance, security and other tests. In his session at DevOps Summit, Kevin Surace, CEO of Appvance, will discuss how we learn from these real-world succe...
SYS-CON Events announced today that VividCortex, the monitoring solution for the modern data system, will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. The database is the heart of most applications, but it’s also the part that’s hardest to scale, monitor, and optimize even as it’s growing 50% year over year. VividCortex is the first unified suite of database monitoring tools specifically desi...
Apps and devices shouldn't stop working when there's limited or no network connectivity. Learn how to bring data stored in a cloud database to the edge of the network (and back again) whenever an Internet connection is available. In his session at 17th Cloud Expo, Bradley Holt, Developer Advocate at IBM Cloud Data Services, will demonstrate techniques for replicating cloud databases with devices in order to build offline-first mobile or Internet of Things (IoT) apps that can provide a better, ...
“All our customers are looking at the cloud ecosystem as an important part of their overall product strategy. Some see it evolve as a multi-cloud / hybrid cloud strategy, while others are embracing all forms of cloud offerings like PaaS, IaaS and SaaS in their solutions,” noted Suhas Joshi, Vice President – Technology, at Harbinger Group, in this exclusive Q&A with Cloud Expo Conference Chair Roger Strukhoff.
SYS-CON Events announced today that Agema Systems will exhibit at the 17th International Cloud Expo®, which will take place on November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Agema Systems is the leading provider of critical white-box rack solutions to data centers through the major integrators and value added distribution channels.
SYS-CON Events announced today that Cloud Raxak has been named “Media & Session Sponsor” of SYS-CON's 17th Cloud Expo, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Raxak Protect automates security compliance across private and public clouds. Using the SaaS tool or managed service, developers can deploy cloud apps quickly, cost-effectively, and without error.
DevOps is gaining traction in the federal government – and for good reasons. Heightened user expectations are pushing IT organizations to accelerate application development and support more innovation. At the same time, budgetary constraints require that agencies find ways to decrease the cost of developing, maintaining, and running applications. IT now faces a daunting task: do more and react faster than ever before – all with fewer resources.
SYS-CON Events announced today that ProfitBricks, the provider of painless cloud infrastructure, will exhibit at SYS-CON's 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. ProfitBricks is the IaaS provider that offers a painless cloud experience for all IT users, with no learning curve. ProfitBricks boasts flexible cloud servers and networking, an integrated Data Center Designer tool for visual control over the...
SYS-CON Events announced today that Key Information Systems, Inc. (KeyInfo), a leading cloud and infrastructure provider offering integrated solutions to enterprises, will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Key Information Systems is a leading regional systems integrator with world-class compute, storage and networking solutions and professional services for the most advanced softwa...