Atlantic Power drops debentureholder meeting, waives needed approval

Chicago, April 29 – Atlantic Power Corp. and wholly owned subsidiary Atlantic Power LP canceled the meeting of holders of its 6% series E convertible subordinated debentures that was to be held on April 29, according to a press release.

Previously, holders of the convertibles were needed to close the acquisition transaction by Atlantic Power, Atlantic Power Preferred Equity Ltd., Atlantic Power LP and certain affiliates of infrastructure funds managed by I Squared Capital Advisors (US) LLC.

However, the buyers and the parties have mutually waived the condition that holders approve the transaction.

The closing date is now set for May 14.

On the closing date, Atlantic power intends to defease all of the convertibles.

Separately, any noteholder who wants to convert their convertibles during the 10 trading days prior to the closing and ending 30 calendar days following the delivery of the change-of-control notice under the indenture, will be entitled to receive the make-whole premium.

The make-whole conversion period is expected to open on April 30 and close on June 14.

The make-whole premium will be established 11 trading days before the closing date and will be based on the Canadian dollar to U.S. dollar exchange rate.

With a C$1.24 to $1.00 exchange rate, the make-whole premium would be 36.0962 common shares per C$1,000 debenture. This would mean that each debenture converted would result in a conversion ratio of around 274.1914 common shares for each C$1,000 debenture.

Convertible holders converting their debentures before the 4 p.m. ET on the third day before the closing will participate in the acquisition as a common shareholder and will receive $3.03 per underlying common share with interest up to the date of the conversion.

If closing occurs, Atlantic Power expects to delist the convertible debentures from the Toronto Stock Exchange and the common shares from the Toronto Stock Exchange and the New York Stock Exchange.

If converted after the deadline, holders will be entitled to receive a cash amount equal to the Canadian dollar equivalent of $3.03 in lieu of each common share previously issuable on a conversion, including any common shares otherwise issuable on account of the make-whole premium if converted within the make-whole conversion period, representing approximately C$3.76 per underlying common share if the exchange rate is the same as above, plus interest.

Except as otherwise provided in the indenture, any convertibles outstanding following the expiration of the make-whole period will continue to receive interest at a rate of 6% per year, payable semiannually, and the repayment of principal upon the redemption of the convertibles. Following the defeasance, the convertibles will be redeemed at par on Jan. 31, 2023.

The transaction remains subject to the satisfaction or waiver of certain conditions, including third-part consents and other customary closing conditions.

Questions should be directed to RBC Dominion Securities (877 381-2099, liability.management@rbccm.com) or to Kingsdale Advisors (866 229-8263, 416 867-2272, contactus@kingsdaleadvisors.com).

Dedham, Mass.-based Atlantic Power owns and operates a fleet of power generation assets.

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