Central Plains Energy Project Announces Consent Solicitation for its Gas Project Revenue Bonds, Series 2007A and Series 2007B

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SOURCE Central Plains Energy Project

NEW YORK, March 19, 2013 /PRNewswire/ -- Central Plains Energy Project ("CPEP") announced today that it is soliciting consent to certain amendments to the transaction from holders of its Gas Project Revenue Bonds, (Project No. 1) Series 2007A and Series 2007B (together with the Series 2007A Bonds, the "Series 2007 Bonds") on the terms and subject to the conditions set forth in the Consent Solicitation Statement dated March 18, 2013.

As more fully described in the Consent Solicitation Statement, the proposed amendments would permit CPEP to:

• Provide credit support for MBIA, Inc., as an investment agreement provider for the Working Capital Account of the Project Fund ($10,095,000), the Current Reserve Subaccount of the Debt Service Reserve Account ($21,630,000), and the Early Termination Reserve Subaccount of the Debt Service Reserve Subaccount ($6,235,000), by amending the Gas Supply Contracts between CPEP and the Project Participants, amending and restating the Receivables Purchase Agreement and amending the Goldman Sachs Guaranty, and by making corresponding amendments to the Indenture. 

• Amend and Restate the Gas Purchase Agreement between CPEP and J. Aron & Company, as gas supplier, to eliminate a seller default if The Goldman Sachs Group, Inc. fails to maintain a credit rating of "BBB-" or higher by Standard & Poor's or "Baa3" or higher by Moody's, or otherwise post credit support.

• Create a custodial arrangement with respect to the Commodity Swaps in order to mitigate CPEP's credit exposure to the Royal Bank of Scotland plc, as the commodity swap counterparty, and make corresponding amendments to the Commodity Swaps in connection therewith.

Adoption of the proposed amendments requires the consent of a majority in principal amount of the Series 2007 Bonds outstanding.   In addition to receiving such consent, the proposed amendments will become effective upon the satisfaction of certain conditions, including the Series 2007 Bonds receiving ratings of at least "A3" from Moody's, "A-" from S&P and "A-" from Fitch Ratings.   As of March 18, the Series 2007 Bonds are rated "B2" by Moody's, "B" by S&P and "A" by Fitch Ratings.

The consent solicitation will expire at 5:00 p.m., New York City time, on April 16, 2013, unless terminated, shortened or extended by CPEP.  Only holders of record of the Series 2007 Bonds as of 5:00 p.m., New York City time, on March 15, 2013, are eligible to deliver consents to the proposed amendments in the consent solicitation.

CPEP has retained RBC Capital Markets, LLC to act as Solicitation Agent in connection with the consent solicitation.  Questions about the consent solicitation may be directed to RBC Capital Markets, LLC at (855) 845-9469 (toll-free).  Copies of the Consent Solicitation Statement and related documents may be obtained from D.F. King & Co., the Information Agent and Tabulation Agent for the consent solicitation, at (800) 431-9645 (toll-free) or (212) 269-5550 (collect). 

This announcement is for informational purposes only and is not a solicitation of consents with respect to any securities.  This announcement shall not constitute an offer to buy or a solicitation of an offer to sell any Series 2007 Bonds.  The consent solicitation is being made solely on the terms and subject to the conditions set forth in the Consent Solicitation Statement and is not being made in any jurisdiction in which it is unlawful to solicit or grant consents.

CPEP is a separate legal entity and a public body corporate and politic (including a not-for-profit corporation) organized under the laws of the State of Nebraska and an instrumentality of its members pursuant to the provisions of the Nebraska Interlocal Cooperation Act, Chapter 13, Article 8, of the Nebraska Revised Statutes, as amended.  CPEP was created to enable its members to take joint and cooperative action with respect to the acquisition, transportation, storage and management of natural gas and related services and functions, including financing one or more natural gas projects.  CPEP sells the gas supply financed with the Series 2007 Bonds to the Metropolitan Utilities District of Omaha and the Municipal Gas Utility of the City of Cedar Falls, Iowa under Gas Supply Contracts that remain in effect through the term of the Gas Purchase Agreement. 

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