Atlantic Power Corporation Announces Launch by Atlantic Power Limited Partnership of Syndication of New Senior Secured Credit

    Atlantic Power Corporation Announces Launch by Atlantic Power Limited
      Partnership of Syndication of New Senior Secured Credit Facilities

PR Newswire

BOSTON, Jan. 30, 2014

BOSTON, Jan. 30, 2014 /PRNewswire/ -- Atlantic Power Corporation (TSX: ATP;
NYSE: AT) (the "Company"), today announced that, as part of the Company's
ongoing plans to address its upcoming debt maturities and improve its
financial flexibility, Atlantic Power Limited Partnership ("APLP"), a
wholly-owned indirect subsidiary of the Company, launched the syndication of
new senior secured credit facilities, comprising up to $600 million in
aggregate principal amount of senior secured term loan facilities and up to
$200 million in aggregate principal amount of senior secured revolving credit
facilities (collectively, the "new credit facilities"). The Company and its
subsidiaries expect to use the new credit facilities to:

  oreplace the Company's existing US$150M senior secured revolving credit
  ofund the optional prepayment or redemption of certain outstanding debt
    securities issued by subsidiaries of the Company referred to below;
  oprovide for ongoing working capital needs of APLP and its subsidiaries;
  osupport APLP's and its subsidiaries' collateral support obligations to
    contract counterparties;
  oprovide for general corporate purposes of APLP and its subsidiaries;
  o(subject to certain limitations) provide for ongoing working capital
    needs, general corporate purposes, and collateral support obligations to
    contract counterparties of Atlantic Power Generation, Inc. ("APGI"),
    another wholly-owned subsidiary of the Company;
  ofund a debt service reserve, and pay transaction costs and expenses; and
  o(upon closing) make a distribution to the Company from remaining proceeds
    of the term loans, which the Company may use for any corporate purpose,
    including, in the discretion of the Company, additional debt reduction
    which may, taking into account available funds, market conditions and
    other relevant factors, include steps to repurchase or redeem, by means of
    a tender offer or otherwise, a portion of the Company's 9.0% senior
    unsecured notes due 2018 (the "9.0% Notes").

The Company will optionally prepay or redeem in whole, at a price equal to par
plus accrued interest and applicable make-whole premium, the following debt
securities of its subsidiaries using funds that will be available under the
new credit facilities:

  othe $190,000,000 aggregate principal amount outstanding of 5.9% Senior
    Notes due 2014 issued by Curtis Palmer LLC; and
  othe $150,000,000 aggregate principal amount outstanding of 5.87% Senior
    Guaranteed Notes, Series A, due 2015 and the $75,000,000 aggregate
    principal amount outstanding of 5.97% Senior Guaranteed Notes, Series B,
    due 2017 issued by Atlantic Power (US) GP.

The early prepayment of the Atlantic Power (US) GP securities was facilitated
by the Company's recent successful consent solicitation under which one
hundred percent of the noteholders approved the issuer's solicitation of a
waiver of the prepayment notice provisions of the Note Purchase Agreement
governing such securities.

As previously disclosed in the Company's Quarterly Report on Form 10-Q for the
quarter ended September 30, 2013, the Company indicated that by the third
quarter of 2014, it may trigger certain restrictions on its ability to make
dividend payments as a result of failing the fixed charge coverage ratio
included in the restricted payments covenant of the indenture governing the
9.0% Notes, which must be at least 1.75 to 1.00, measured on a rolling four
quarter basis, including after giving effect to certain pro forma adjustments.
The Company currently believes that primarily due to the aggregate impact of
the make-whole payment and charges for unamortized debt discount and fee
expenses associated with the early prepayment or redemption of securities
described above (all of which will be reflected as charges to the Company's
2014 first quarter results), the Company will fail to meet the fixed charge
coverage ratio as early as late February. As a consequence, further dividend
payments, which are paid at the discretion of the Company's board of
directors, in the aggregate cannot exceed the covenant's "basket" provision of
the greater of $50 million and 2% of consolidated net assets (approximately
$68 million at September 30, 2013) until such time that the fixed charge
coverage ratio were to be satisfied.

The Company's existing senior secured credit facilities (the "existing
revolving credit facilities") contain certain guaranties, which will be
terminated in connection with the termination of the existing revolving credit
facilities. In addition, the terms of the Company's 9.0% Notes provide that
the guarantors of such existing revolving credit facilities guarantee the 9.0%
Notes. As a result, upon termination of the existing revolving credit
facilities and the related guaranties, the guaranties under the 9.0% Notes
will be cancelled and the guarantors of the 9.0% Notes will be released from
all of their obligations under such guaranties.

The new credit facilities will be secured by a pledge of the equity interests
in APLP and its subsidiary guarantors, guaranties from the APLP subsidiary
guarantors, a pledge of certain material contracts and certain mortgages over
material real estate rights, an assignment of all revenues, funds and accounts
of APLP and its subsidiary guarantors, and certain other assets. The new
credit facilities will not be otherwise guaranteed or secured by the Company
or any of its subsidiaries (other than the APLP subsidiary guarantors).

APLP's existing $210 million aggregate principal amount of 5.95% Medium Term
Notes due June 23, 2036 (the "MTNs") prohibit APLP (subject to certain
exceptions) from granting liens over any of its assets (and those of its
material subsidiaries) to secure any indebtedness, unless the MTNs are secured
equally and ratably with such other indebtedness. Accordingly, in connection
with the execution of the new credit facilities, APLP will grant an equal and
ratable security interest in the collateral package securing the new credit
facilities in favor of the trustee for the benefit of the holders of the MTNs.

The closing of the new credit facilities is subject to syndication, the
conclusion of negotiations, execution of final documentation, receipt of
requisite approvals and satisfaction of customary closing conditions. There
can be no assurance that APLP will be successful in its syndication efforts or
that APLP will be able to enter into the new credit facilities.

The Company has appointed Goldman Sachs Lending Partners LLC and Bank of
America Merrill Lynch as joint lead arrangers for the new credit facilities.

Subject to the conclusion of negotiations and execution of definitive
documentation, the following is a summary of certain anticipated terms of the
new credit facilities.

The new credit facilities will require APLP and its subsidiary guarantors to
maintain a leverage ratio of total debt to adjusted EBITDA, and an interest
coverage ratio of adjusted EBITDA to cash interest expense. In addition, the
new credit facilities will include customary restrictions and limitations on
APLP's and its subsidiary guarantors' ability to (i) incur additional
indebtedness, (ii) grant liens on any of their assets, (iii) change their
conduct of business or enter into mergers, consolidations, reorganizations, or
certain other corporate transactions, (iv) dispose of assets, (v) modify
material contractual obligations, (vi) enter into affiliate transactions,
(vii) incur capital expenditures, and (viii) make dividend payments or other
distributions, in each case subject to customary carve-outs and exceptions and
various negotiated thresholds.

If the Company experiences a change of control (as defined in the new credit
facilities), unless the Company elects to make a voluntary prepayment of the
term loans under the new credit facilities, it will be required to offer each
electing lender to prepay such lender's term loans under the new credit
facilities at a price equal to 101% of par.

The new credit facilities will also be subject to customary mandatory
prepayment provisions, including:

  ofrom proceeds of assets sales, insurance proceeds, and incurrence of
    indebtedness, in each case subject to applicable thresholds and customary
    carve-outs; and
  ousing 50% of excess cash flow from APLP.

Cautionary Note Regarding Forward-looking Statements

To the extent any statements made in this news release contain information
that is not historical, these statements are forward-looking statements within
the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and
Section 21E of the U.S. Securities Exchange Act of 1934, as amended and under
Canadian securities law (collectively, "forward-looking statements").

Certain statements in this news release may constitute "forward-looking
statements", which reflect the expectations of management regarding the future
growth, results of operations, performance and business prospects and
opportunities of our Company and our projects. These statements, which are
based on certain assumptions and describe our future plans, strategies and
expectations, can generally be identified by the use of the words "may,"
"will," "project," "continue," "believe," "intend," "anticipate," "expect" or
similar expressions that are predictions of or indicate future events or
trends and which do not relate solely to present or historical matters.
Examples of such statements in this press release include, but are not
limited, to statements with respect to the following:

  othe successful syndication, negotiation (including the definitive terms of
    relevant covenants) and execution of the new credit facilities;
  othe Company's general expectations regarding the use of proceeds;
  othe specific series of debt securities of the Company's subsidiaries to be
    redeemed or prepaid, if at all; and
  othe Company's potential compliance or non-compliance with the fixed charge
    coverage ratio in the indenture governing the Company's 9.0% Notes.

Forward-looking statements involve significant risks and uncertainties, should
not be read as guarantees of future performance or results, and will not
necessarily be accurate indications of whether or not or the times at or by
which such performance or results will be achieved. Please refer to the
factors discussed under "Risk Factors" in the Company's periodic reports as
filed with the Securities and Exchange Commission from time to time for a
detailed discussion of the risks and uncertainties affecting our Company.
Although the forward-looking statements contained in this news release are
based upon what are believed to be reasonable assumptions, investors cannot be
assured that actual results will be consistent with these forward-looking
statements, and the differences may be material. These forward-looking
statements are made as of the date of this news release and, except as
expressly required by applicable law, the Company assumes no obligation to
update or revise them to reflect new events or circumstances.

About Atlantic Power

Atlantic Power owns and operates a diverse fleet of power generation assets in
the United States and Canada. Atlantic Power's power generation projects sell
electricity to utilities and other large commercial customers largely under
long-term power purchase agreements, which seek to minimize exposure to
changes in commodity prices. Its power generation projects in operation have
an aggregate gross electric generation capacity of approximately 3,018 MW in
which its aggregate ownership interest is approximately 2,098 MW. Its current
portfolio consists of interests in twenty-nine operational power generation
projects across eleven states in the United States and two provinces in

Atlantic Power has a market capitalization of approximately $400 million and
trades on the New York Stock Exchange under the symbol AT and on the Toronto
Stock Exchange under the symbol ATP. For more information, please visit the
Company's website at or contact:

Atlantic Power Corporation
Amanda Wagemaker, Investor Relations
(617) 977-2700

Copies of financial data and other publicly filed documents are filed on SEDAR
at or on EDGAR at under "Atlantic Power
Corporation" or on the Company's website.

SOURCE Atlantic Power Corporation

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