Assured Guaranty Withdraws Complaint Against PREPA
14 October 2017 - 10:08AM
Business Wire
Assured Guaranty Municipal Corp. and Assured Guaranty Corp., two
bond insurance subsidiaries of Assured Guaranty Ltd. (NYSE:AGO)
(together with its subsidiaries, Assured Guaranty or the Company),
have voluntarily withdrawn without prejudice their lawsuit seeking
the application by the Puerto Rico Electric Power Authority (PREPA)
of pledged revenues to the payment of its bonds. The complaint,
filed on August 7, 2017, asserted that PREPA's failure to remit
revenues in accordance with the terms of sections 902, 922(d), and
928 of the Bankruptcy Code (Special Revenues Provisions) and the
bond trust agreement violated the protections provided by the
Special Revenues Provisions and the Takings and Due Process Clauses
of the U.S. Constitution.
While the Company continues to believe that PREPA's failure to
apply its pledged revenues to the payment of its revenue bonds over
the past three years is inconsistent with the Special Revenues
Provisions and violates the U.S. Constitution, PREPA's focus right
now should be on restoration of the power grid damaged by Hurricane
Maria. This is not an appropriate time to be litigating these
issues while continued emergency efforts are needed to restore
electricity to the island’s residents and businesses. Given these
circumstances, Assured Guaranty, together with other PREPA
creditors, has voluntarily decided to withdraw its complaint
without prejudice at this time.
“We urge the Oversight Board and PREPA to take this opportunity
to work collaboratively with creditors, as we did previously, to
produce a comprehensive reconstruction plan that ensures power is
restored in Puerto Rico as soon as possible and that PREPA moves
forward with a workable long-term development plan consensually
with all stakeholders,” said Dominic Frederico, President and CEO
of Assured Guaranty.
Under applicable law, the Company is permitted to refile the
lawsuit. Should PREPA fail to resume timely payment of its bonds,
in accordance with the terms of the Special Revenues Provisions,
after restoration of the electric system, the Company will consider
refiling this lawsuit at an appropriate time.
Cautionary Statement Regarding Forward-Looking
Statements
Any forward-looking statements made in this press release
reflect Assured Guaranty’s current views with respect to future
events and are made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. Such statements
involve risks and uncertainties that may cause actual results to
differ materially from those set forth in these statements. These
risks and uncertainties include, but are not limited to, those
resulting from further adverse developments in Puerto Rico or at
any of its instrumentalities, litigation that has already been
initiated or may be initiated in the future, governmental or
legislative action or inaction by Puerto Rico or the United States
(including any actions taken by the Oversight Board), other risks
and uncertainties that have not been identified at this time,
management’s response to these factors, and other risk factors
identified in Assured Guaranty’s filings with the Securities and
Exchange Commission. Readers are cautioned not to place undue
reliance on these forward-looking statements, which are made as of
October 13, 2017. Assured Guaranty undertakes no obligation to
publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise, except
as required by law.
Assured Guaranty Ltd. is a publicly traded Bermuda-based holding
company. Its operating subsidiaries provide credit enhancement
products to the U.S. and international public finance,
infrastructure and structured finance markets. More information on
Assured Guaranty Ltd. and its subsidiaries can be found at
AssuredGuaranty.com.
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version on businesswire.com: http://www.businesswire.com/news/home/20171013005711/en/
Assured Guaranty Ltd.Robert Tucker, 212-339-0861Senior Managing
Director, Investor Relations and Corporate
Communicationsrtucker@agltd.comorMedia:Ashweeta Durani,
212-408-6042Vice President, Corporate
Communicationsadurani@agltd.com
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