PureCycle Technologies reaches agreement in principle to buy Ironton bonds

PureCycle Technologies announced that PureCycle: Ohio has reached an agreement in principle with holders of a majority of the Southern Ohio Port Authority Exempt Facility Revenue Bonds, Tax-Exempt Series 2020A, of which $219,550,000 principal amount is outstanding, to purchase for cash, at a purchase price equal to $1,030 per $1,000 principal amount of Bonds purchased. In addition to the Majority Holders, additional holders of the Series 2020A Bonds may participate in the Purchase. Holders of the Series 2020A Bonds that participate in the Purchase will be required to consent to certain proposed amendments to the bond documents governing the Series 2020A Bonds and closing of the Purchase will require that no less than Majority Holders participate in the Purchase and provide their Consents. The Proposed Amendments will eliminate certain restrictive covenants and events of default contained in the bond documents governing the Series 2020A Bonds that are permitted to be eliminated with the consent of the Majority Holders. The Consents will become effective upon closing of the Purchase. In addition to the Purchase of the Series 2020A Bonds, PCO may purchase Southern Ohio Port Authority Subordinate Exempt Facility Revenue Bonds, Tax-Exempt Series 2020B, of which $20,000,000 principal amount is outstanding, and Southern Ohio Port Authority Subordinate Exempt Facility Revenue Bonds, Taxable Series 2020C of which $10,000,000 principal amount is outstanding for which Consents shall also be required to the extent such Bonds are purchased. The Purchase Price is calculated in part to compensate the Sellers for default interest accruing from January 2, 2023 through December 31, 2023, and any other accrued and unpaid interest on the Bonds from, and including, the most recent interest payment date up to the closing date of the Purchase. The Purchase Price does not include any default or penalty interest accruing from January 1, 2024, that may otherwise be owed and Holders that participate in the Purchase will waive their respective right to such default or penalty interest. The Proposed Amendments to the Indenture of Trust, dated as of October 1, 2020, between Southern Ohio Port Authority and UMB Bank, N.A., as trustee and the Loan Agreement by and between the Issuer and PCO, dated as of October 1, 2020 are expected to include, but are not limited to, the following: Elimination of certain restrictive covenants and events of default contained in the Indenture and the Loan Agreement and other transaction documents that are permitted to be eliminated with the consent of the Majority Holders; and Release of funds on deposit in accounts in the Trust Estate in an amount proportionate to the percentage of the aggregate principal amount of the Bonds that Sellers submit for Purchase, which released funds will be used by PCO to effectuate the Purchase. The Purchase is intended to allow the Company to provide additional flexibility in completing commissioning activities at the Ironton Facility. The Company expects to fund the Purchase with those Trust Estate funds released under the Proposed Amendments together with available cash on hand. The Purchase will not occur unless the Majority Holders participate in the Purchase and provide Consents to the Proposed Amendments. The Purchase is expected to close no later than February 15, 2024.