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  • Writer's pictureThe San Juan Daily Star

Judge approves PREPA’s debt disclosure statement


U.S. District Judge Laura Taylor Swain

By The Star Staff


U.S. District Judge Laura Taylor Swain has approved the Puerto Rico Electric Power Authority’s (PREPA) disclosure statement, moving the process closer to the confirmation of the utility’s heatedly debated debt adjustment plan.


In a Nov. 17 ruling, the judge said the disclosure statement, which contains an explanation in laymen’s terms of the debt adjustment plan, contains adequate information within the meaning of Section 1125 of the Bankruptcy Code, and no other or further information is necessary for purposes of soliciting acceptances and rejections of the Fifth Modified Third Amended Plan. Hearings to confirm the debt adjustment plan are slated for March 2024.


The judge also said the ballot forms are consistent with official bankruptcy forms and adequately address the particular needs of the Title III case, and are appropriate for the relevant classes of claims entitled under the Fifth Modified Third Amended Plan.


The ballots to vote to accept or reject the debt adjustment plan need only be provided to: Assured Guaranty Corp. and Assured Guaranty Municipal Corp.; Assured Insured Bonds & Interest Rate Swap Secured Claims in Class 4 and Assured Insured Bonds & Interest Rate Swap Unsecured Claims in Class 5; Syncora Guarantee Inc. on account of Syncora Insured Bonds Secured Claims in Class 6 and Syncora Insured Bonds Unsecured Claims in Class 7; National Public Finance Guarantee Corp. on account of National Insured Bonds Secured Claims in Class 8 and National Insured Bonds Unsecured Claims in Class 9; and Holders of Claims in Class 1 consisting of the first Settlement Bondholder Claims; Class 2 consisting of uninsured bondholder secured Claims; Class 3 comprising uninsured bondholder claims; Class 10, which are pension claims; Class 11 or Fuel Line Loan lenders; Class 12, which are general unsecured Claims; Class 13, the Vitol Claims; and Class 16, which are federal claims.


The beneficial owners of PREPA Revenue Bonds insured by National shall be entitled to receive an election notice and make an election with respect to the form of distribution pursuant to the Fifth Modified Third Amended Plan. Beneficial Owners of PREPA Revenue Bonds insured by Assured or Syncora will be entitled to receive a notice of nonvoting status informing them that Assured or Syncora will be entitled to vote to approve or reject the Fifth Modified Third Amended Plan.


Ballots need not be provided to the holders of claims in Class 14, composed of the ordinary course customer claims; Class 15, which are Eminent Domain/Inverse Condemnation Claims; and Class 17, which are convenience claims because the holders of those claims are unimpaired.

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