Stoneway Capital Corporation and Mezzanine Lenders Enter into an Amended and Restated Restructuring Support Agreement with Ad Hoc Group of Noteholders to Effect the Restructuring of Existing Notes

NEW YORK, March 15, 2021 /PRNewswire/ -- Stoneway Capital Corporation ("Stoneway," and together with its subsidiaries and parent entities, the "Company") and an ad hoc group of note holders (the "Consenting Holders") holding a substantial majority of 10.000% Senior Secured Notes due 2027 (the "Existing Notes") issued by Stoneway have agreed to amend and restate the previously disclosed restructuring support agreement, dated as of September 21, 2020, as amended on November 20, 2020 (together with the Restructuring Term Sheet included as an exhibit thereto, the "Existing Restructuring Support Agreement"), entered into in connection with the Company's proposed restructuring transaction (the "Transaction") to be implemented pursuant to a corporate plan of arrangement (as amended and as may be further amended, the "Plan") under the Canada Business Corporations Act ("CBCA").

The Restructuring Support Agreement

The terms and conditions of the Existing Restructuring Support Agreement have been amended and restated pursuant to an Amended and Restated Restructuring Support Agreement (the "Amended and Restated Restructuring Support Agreement") to reflect the following changes:

• The Voting Deadline, Plan Approval Date and the Restructuring Effective Date (each, as defined in the Amended and Restated Restructuring Support Agreement) have been modified as follows:
• Voting Deadline: (x) March 31, 2021 or (y) if applicable, in accordance with an Implementation Schedule (as defined in the Amended and Restated Restructuring Support Agreement) setting forth the required milestones pursuant to which the Transaction shall be implemented.
• Plan Approval Date: (x) March 31, 2021 or (y) if applicable, in accordance with an Implementation Schedule setting forth the required milestones pursuant to which the Transaction shall be implemented.
• Restructuring Effective Date: (x) March 31, 2021 (from December 14, 2020) or (y) if applicable, in accordance with an Implementation Schedule setting forth the required milestones pursuant to which the Transaction shall be implemented.
• Certain covenants under the heading "Additional Covenants of the Credit Parties" have been added, including, among others, with respect to: (i) the Company delivering prompt written notice to the Consenting Holders upon receipt of (a) any written notice regarding any legal proceeding commenced or pursued against the Company relating to or involving or that may otherwise adversely affect the operations of the power plants or (b) any written notices regarding the Matheu power plant or the Company's application for permits in connection with a noise remediation plan relating to the Matheu power plant (the "Matheu Plan") or any other permit necessary to operate any of the Company's power plants at full capacity; and (ii) the ability of advisors to the Consenting Holders to participate in certain meetings with governmental authorities in connection with the Transaction, the Matheu Plan or ongoing litigation relating to the Company's Matheu and Lujan power plants.
• Certain termination events under the heading "Termination Events" have been added, including (i) automatic termination of the agreement on March 31, 2021, which date may be extended to May 14, 2021 in the sole and absolute discretion of a majority of the holders of the Existing Notes; (ii) subject to certain exceptions, termination by a majority of the holders of the Existing Notes in the event that any governmental authority grants a permanent order or decision preventing the Company from operating any of the plants at full capacity; or (iii) any governmental authority issues a permanent order that prevents the Matheu Plan from being implemented.
• Upon termination of the agreement pursuant to its terms, the parties have agreed or consented, as applicable, to the immediate lifting of the stay of proceedings described in the interim order of the CBCA Proceedings (as defined below).

Noteholder's Meeting and Final Order Hearing

The Company will provide further details with respect to the timing of the meeting of holders of Existing Notes (the "Noteholder's Meeting") to consider and vote on the Plan, and the timing of the hearing before the Ontario Superior Court of Justice (Commercial List) (the "Court") to seek a court order approving the Plan, in a subsequent press release once such details become available.

Important Note

The consummation of the Plan is subject to the satisfaction of the closing conditions set forth in the Restructuring Support Agreement and remains subject, among other things, to the approval of the Court pursuant to a final order.

The Amended and Restated Restructuring Support Agreement is not an offer or acceptance with respect to any securities or a solicitation to purchase any securities or an acceptance of a plan of organization or acuerdo preventivo extrajudicial proposed in connection with any insolvency proceeding and any such offer or solicitation will comply with all applicable securities laws and any other applicable law. 

About Stoneway

The Company's principal business is the construction, ownership and operation of power generation facilities located in Argentina.

FORWARD LOOKING STATEMENTS: Certain information contained in this press release may contain forward looking statements within the meaning of applicable securities laws. The use of any of the words "continue", "plan", "propose", "would", "will", "believe", "expect", "position", "anticipate", "improve", "enhance" and similar expressions are intended to identify forward-looking statements. More particularly and without limitation, this document contains forward-looking statements concerning: key terms of the Transaction; the expected process and timing for implementing the Transaction; the holding and timing of, and matters to be considered at, the Noteholders' Meeting as well as with respect to voting at the Noteholders' Meeting; the deadlines for submitting proxies and voting instructions; the scheduling of the Noteholders' Meeting; and the matters to be considered at and voted on the Noteholders' Meeting; the relief to be sought in by the Company in its proceedings under the CBCA (the "CBCA Proceedings") in respect of the Plan; the completion of the Transaction, including with respect to obtaining any necessary approvals and satisfying any conditions and the expected timing thereof; the public posting of materials and information related to the Transaction; and the effect of the Transaction.

Forward-looking statements necessarily involve risks, including, without limitation, risks associated with the ability of the Company to implement the Transaction on the terms described in this press release and in previous announcements, the ability of Stoneway to receive all necessary court, third party and stakeholder approvals in order to complete the Transaction; the matters to be considered and voted on at the Noteholders' Meeting; the ability of the Company to operate in the ordinary course during the CBCA Proceedings, including with respect to satisfying obligations to service providers, suppliers, contractors and employees; the ability of the Company to continue as a going concern; the ability of the Company to continue to realize its assets and discharge its liabilities and commitments; the Company's future liquidity position and access to capital to fund ongoing operations and obligations (including debt obligations); and the ability of the Company to stabilize its business and financial condition.

Although the Company bases its forward-looking statements on assumptions believed to be reasonable when made, they are not guarantees of future performance and actual results of operations, financial condition and liquidity, and developments in the industry in which the Company operates, may differ materially from any such information and statements in this news release. Other unknown or unpredictable factors also could harm the Company's future results. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included in this news release are made only as at the date hereof. The Company does not intend, and does not assume any obligation, to update these forward-looking statements, except as required by law.

SOURCE Stoneway Capital Corporation