Fiscal board extends offer to certain lenders for joining debt adjustment plan

By The Star Staff

The Financial Oversight and Management Board for Puerto Rico has extended to holders of certain government loans certain offers if they agree to join the debt adjustment plan that would restructure some $35 billion in central government debt.

These loan holders will be able to obtain certain restriction fees if they agree to join the debt deal by Aug. 13, according to a filing to the municipal markets and a press release issued by the oversight board on Monday. While it varies, the debt deal’s restriction fee is in the form of an allowed administrative claim, payable in cash, at the time of consummation of the plan.

“The plan support agreement (PSA) restriction fee associated with the Commonwealth amended and restated plan support agreement is available to beneficial owners of GO (General Obligation) bonds, PBA (Public Buildings Authority) bonds, and PRIFA BANs (Puerto Rico Infrastructure Financing Authority bond anticipation notes),” the oversight board said in the filing.

Bonds or loans that are not listed in an amended notice to holders of uninsured bonds per an Electronic Municipal Market Access (EMMA) notice filed July 27 or the notice to holders of uninsured bonds per an EMMA notice filed July 30, and that are not primarily or secondarily insured by a monoline, are eligible to receive the PSA restriction fee, though such bonds or loans will not be required to participate in the tender and exchange.

A separate EMMA notice was posted that included instructions for holders of certain applicable claims to send joinder agreements in lieu of participating in the tender and exchange, the oversight board said.

Those applicable bonds/loans are as follows:

First, Savings Notes for Economic Cooperation with Puerto Rico (“Notas de Ahorro”) or savings notes issued by the commonwealth government pursuant to Act No. 7 of the Puerto Rico Legislature, the payment of which is backed by the full faith and credit of the commonwealth, in the aggregate original principal amount of $2.8 million.

Second, a GSA Helicopter Loan or a loan extended pursuant to that certain Credit Agreement, dated as of Dec. 26, 2013, between the General Services Administration of the commonwealth and Scotiabank de Puerto Rico as of the commonwealth Title III petition date, in the outstanding principal amount of $23.7 million.

Third are certain Treasury Department loans identified as Loan ID: 20001721500100347; Loan ID: 20001721500100348; Loan ID: 20001721500100353 and Loan ID: 20001721500100356.

Another eligible loan is from the Port of the Americas Authority Bond or as of the commonwealth Title III petition date, in the outstanding principal amount of $225.5 million.

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