Le Lézard
Classified in: Business
Subject: RCN

Neuquén Ad-Hoc Secured Bondholder Committee Rejects Restructuring Proposal

NEW YORK, Aug. 14, 2020 /PRNewswire/ -- An Ad-Hoc Committee of Secured Bondholders (the "AHC") of the Province of Neuquén (the "Province"), which is comprised of institutional investors holding over 25% of the Province's outstanding US$338,231,240 Secured 8.625% Notes due 2028 (the "Secured Notes"), has been formed and categorically rejects the unilateral consent solicitation published by the Province on August 10, 2020 (the "Offer").

The Secured Notes have specialized terms and protections relative to the majority of public issuances. The Province assigned specified royalties to an Argentine Collateral Trust for the benefit of the Secured Notes. The assignment and financing structure insulated performance on the Secured Notes from the Province's finances. In short, the Province offered security in exchange for more attractive lending terms and the royalties pledged to the Argentine Collateral Trust have and continue to be sufficient to service the current and future payments due under the Secured Notes. As such, the AHC objects to the Offer and any attempt to reverse these bargained for protections, particularly at the very time they are most needed.

Separately, the AHC has reviewed the terms of the Offer and believes that, in addition to its punitive economic terms, the Offer needlessly eviscerates various contractual protections afforded to the Secured Noteholders, including emptying certain reserve accounts established for the benefit of holders and changing modification procedures for the Secured Notes in order to force Secured Noteholders to accept a potential non-consensual restatement of the notes' terms at a later date.

As a result, the AHC will not participate in the Offer or any unilateral exercise seeking permanent impairment of the Secured Notes' contractual rights and jeopardizing the validity of a reliable financing structure available in the Argentine market. The AHC remains open to a transparent and timely dialogue with the Province and its advisors on a good faith basis. 

Holders of the Notes wishing to understand their contractual rights in respect of the Secured Notes or receive further information about the AHC are encouraged to contact Chris Clark at Latham & Watkins LLP (chris.clark@lw.com).


SOURCE Neuquén Ad-Hoc Secured Bondholder Committee

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