Exhibit M

FUEL LINE LENDER PSA

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Exhibit M Page 1 of 32
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PUERTO RICO ELECTRIC POWER AUTHORITY 

NOTICE OF VOLUNTARY FILING 

FUEL LINE LENDER PLAN SUPPORT AND SETTLEMENT AGREEMENT

Pursuant to orders of the United States District Court for the District of Puerto Rico presiding 

over the debt restructuring case of the Puerto Rico Electric Power Authority (“PREPA”) under 

Title III of the Puerto Rico Oversight, Management, and Economic Stability Act, the Financial 

Oversight and Management Board for Puerto Rico (the “FOMB”) and the Puerto Rico Fiscal 

Agency and Financial Advisory Authority (“AAFAF”) entered into mediation regarding a potential 

settlement of, among other things, PREPA’s indebtedness under certain agreements pursuant 

to which PREPA was loaned funds to purchase fuel (the “Fuel Line Loans”) by certain parties 

(collectively, the “Fuel Line Lenders”). 

On December 1, 2022, the FOMB and the Fuel Line Lenders executed a Plan Support and 

Settlement Agreement (the “FLL PSA”). 

A copy of the FLL PSA is attached hereto as Exhibit A. 

Dated: December 1, 2022 

THIS NOTICE IS NOT AN OFFER WITH RESPECT TO ANY SECURITIES OR A SOLICITATION OF 

ACCEPTANCES OF A TITLE III PLAN WITHIN THE MEANING OF SECTION 1125 OF THE BANKRUPTCY 

CODE INCORPORATED INTO PROMESA SECTION 301. ANY SUCH OFFER OR SOLICITATION WILL 

COMPLY WITH ALL APPLICABLE SECURITIES LAWS AND PROVISIONS OF PROMESA.

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EXHIBIT A 

FLL PSA 

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EXECUTION VERSION

1

THIS PLAN SUPPORT AND SETTLEMENT AGREEMENT IS NOT AN OFFER WITH 

RESPECT TO ANY SECURITIES OR A SOLICITATION OF ACCEPTANCES OF A 

PLAN OF ADJUSTMENT FOR PURPOSES OF PROMESA, SECTIONS 1125 AND 1126 

OF THE BANKRUPTCY CODE OR OTHERWISE. ANY SUCH OFFER OR 

SOLICITATION WILL COMPLY WITH ALL APPLICABLE SECURITIES LAWS 

AND/OR PROVISIONS OF PROMESA AND THE BANKRUPTCY CODE. NOTHING 

CONTAINED IN THIS AGREEMENT SHALL BE AN ADMISSION OF FACT OR 

LIABILITY OR, UNTIL THE OCCURRENCE OF THE AGREEMENT EFFECTIVE 

DATE ON THE TERMS DESCRIBED HEREIN, DEEMED BINDING ON ANY OF THE 

PARTIES HERETO.

THIS PLAN SUPPORT AND SETTLEMENT AGREEMENT DOES NOT PURPORT TO 

SUMMARIZE ALL OF THE TERMS, CONDITIONS, REPRESENTATIONS, 

WARRANTIES, AND OTHER PROVISIONS WITH RESPECT TO THE 

TRANSACTIONS DESCRIBED HEREIN, WHICH TRANSACTIONS WILL BE 

SUBJECT TO THE COMPLETION OF DEFINITIVE DOCUMENTS INCORPORATING 

THE TERMS SET FORTH HEREIN AND THE CLOSING OF ANY TRANSACTION 

SHALL BE SUBJECT TO THE TERMS AND CONDITIONS SET FORTH IN SUCH 

DEFINITIVE DOCUMENTS AND THE APPROVAL RIGHTS OF THE PARTIES SET 

FORTH HEREIN AND IN SUCH DEFINITIVE DOCUMENTS.

PLAN SUPPORT AND SETTLEMENT AGREEMENT

This Plan Support and Settlement Agreement (together with the exhibits attached hereto, 

which include, without limitation, the Term Sheet (as defined herein) attached hereto as Exhibit 

A, as each may be amended, restated, supplemented, or otherwise modified from time to time in 

accordance with the terms hereof, the “Agreement”) dated as of December 1, 2022 is entered into 

by and among: (i) the Financial Oversight and Management Board for Puerto Rico (the “FOMB”), 

as Title III representative of the Puerto Rico Electric Power Authority (“PREPA”) and (ii) all of 

the holders of the Fuel Line Loans (as defined herein), as identified on Annex A, as such holders 

may change from time to time in accordance with Section 5(e) (collectively, the “Fuel Line 

Lenders”, and each individually, a “Fuel Line Lender”). This Agreement collectively refers to 

FOMB and the Fuel Line Lenders as the “Parties” and the FOMB and each Fuel Line Lender 

individually as a “Party.”

RECITALS

WHEREAS, PREPA is the borrower of $700,877,093.58 (the “FLL Prepetition Claim 

Amount”) in principal amount of loans and other financial accommodations (including interest 

accrued through July 2, 2017) pursuant to (i) the Credit Agreement dated May 4, 2012, by and 

among PREPA, Scotiabank de Puerto Rico, and certain lenders (as amended, amended and 

restated, supplemented or otherwise modified from time to time, the “Scotia Line”), and (ii) the 

Trade Finance Facility Agreement, dated July 20, 2012, by and between PREPA and Citibank, 

N.A. (as amended, amended and restated, supplemented or otherwise modified from time to time, 

the “Citi Line,” and together with the Scotia Line, the “Fuel Line Facilities,” and the loans and 

advances issued under each, collectively, the “Fuel Line Loans”). 

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WHEREAS, as of the date hereof, the total outstanding principal amount of Fuel Line 

Loans that are beneficially owned by each Fuel Line Lender is set forth on their respective 

signature pages hereto.

WHEREAS, on June 30, 2016, the Puerto Rico Oversight, Management, and Economic 

Stability Act was signed into law by the President of the United States (P.L. 114-187, 

“PROMESA”).

WHEREAS, PROMESA established the FOMB and provided the FOMB with certain 

powers over the finances and restructuring process with respect to the Commonwealth of Puerto 

Rico and its instrumentalities as provided for in PROMESA, and the FOMB has designated PREPA 

as a Covered Territorial Instrumentality (as defined in PROMESA).

WHEREAS, on July 2, 2017, the FOMB filed a Title III petition on behalf of PREPA (the 

“Title III Case”) with the United States District Court for the District of Puerto Rico (the “Title 

III Court”).

WHEREAS, the FOMB is the Title III representative of PREPA in the Title III Case 

pursuant to PROMESA section 315(b).

WHEREAS, on July 9, 2019, the Fuel Line Lenders filed a complaint and adversary 

proceeding [Adv. Pro. No. 19-00396] (the “Priority Litigation”) against the FOMB, PREPA, the 

Puerto Rico Fiscal Agency and Financial Advisory Authority (“AAFAF”), and U.S. Bank National 

Association, in its capacity as trustee for certain power revenue bonds and power revenue 

refunding bonds issued and outstanding pursuant to the Trust Agreement, dated as of January 1, 

1974, as amended, amended and restated, supplemented or otherwise modified from time to time, 

between PREPA and U.S. Bank National Association (the “Trust Agreement”), asserting, among 

other things, that the Fuel Line Loans constitute “Current Expenses” under the Trust Agreement 

and have priority over PREPA’s bondholders.

WHEREAS, the FOMB, PREPA, AAFAF, and other defendants in the Priority Litigation

filed motions to dismiss the Priority Litigation, which motions were terminated without prejudice 

on September 29, 2022 [Case No. 17-4780, ECF No. 3013].

WHEREAS, the Priority Litigation has been stayed since April 2, 2020.

WHEREAS, the Parties have engaged in good faith, arm’s-length negotiations regarding 

the (i) consensual resolution of the Priority Litigation and (ii) principal economic terms of a 

proposed restructuring of the Fuel Line Loans to be implemented in a manner to be mutually agreed 

upon as set forth in the Term Sheet and in this Agreement.

WHEREAS, the Parties desire to express to each other their mutual support and 

commitment with respect to a plan of adjustment for PREPA, including matters discussed in this 

Agreement.

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NOW, THEREFORE, in consideration of the covenants herein, each Party, intending to 

be legally bound hereby, agrees as follows:

Section 1. Agreement Effective Date. This Agreement shall become effective and binding on 

each Party immediately upon the execution and delivery of counterpart signatures to this 

Agreement by each of the FOMB and a majority in number of the Fuel Line Lenders, beneficially 

owning or controlling, in the aggregate, at least two-thirds of the FLL Prepetition Claim Amount

(the “Agreement Effective Date”).

Section 2. Settlement. In settlement of the Fuel Line Lenders’ asserted priority, rights and 

claims as set forth in the pleadings filed in the Priority Litigation and the Fuel Line Lenders’ Proofs 

of Claim,

1 the Parties agree that the PREPA Title III plan of adjustment, (a) initially filed by the 

FOMB after the date hereof and each amendment, amendment and restatement, restatement, 

supplement or modification thereto that is filed by the FOMB after the date hereof, and (b) that 

becomes effective, shall, in every case, incorporate the terms of the restructuring of the Fuel Line 

Loans set forth on the term sheet attached hereto as Exhibit A (the “Term Sheet,” and capitalized 

terms used but not otherwise defined herein shall have the meanings ascribed to them in the Term 

Sheet) and otherwise include terms and provisions (including, without limitation, conditions to 

effectiveness) reasonably satisfactory to the Fuel Line Lenders that beneficially own or control, in 

the aggregate, at least a majority in principal amount of the Fuel Line Loans beneficially owned 

or controlled, in the aggregate, by the Fuel Line Lenders at such time (the “Required Lenders”)

as supporting claimholders (collectively, the “Plan”). 

Section 3. Exhibits Incorporated by Reference. Each of the exhibits and schedules attached 

hereto is expressly incorporated herein and made a part of this Agreement, and all references to 

this Agreement shall include the exhibits. 

Section 4. Covenants of the Parties.

(a) Covenants of the FOMB. The FOMB shall take, and use its best efforts 

to cause PREPA to take, all actions necessary to obtain, and shall not encourage any other person 

to, take any action which would, or would reasonably be expected to, impede or preclude the filing 

of the Plan and a related disclosure statement (the “Disclosure Statement”), the approval of the 

Disclosure Statement and the entry of a confirmation order with respect to the Plan (the

“Confirmation Order”) and the consummation, implementation and administration of the Plan, 

including the execution and delivery of all definitive documents required to implement the Plan, 

including an indenture or trust agreement governing the New Bonds (the “Definitive 

Documents”), provided that the Disclosure Statement, the Plan (and its consummation, 

implementation and administration) and the other Definitive Documents are consistent with the 

terms herein. Such actions shall include, but not be limited to: (i) filing the Plan and Disclosure 

Statement, in form and substance consistent with this Agreement and reasonably acceptable to the 

FOMB and the Required Lenders, with the Title III Court by December 9, 2022 or any later date 

as ordered by the Title III Court, subject to any subsequent amendments not inconsistent with this 

Agreement and reasonably satisfactory to the Required Lenders; (ii) prosecuting, in a timely and 

 1

 The “Proofs of Claim” are the proofs of claim filed by the Fuel Line Lenders on account of the Fuel Line Loans and 

filed at proofs of claim nos. 44342, 44358, 44378, 44388, 45816, 44378, 45816.

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appropriate manner, the approval of the Disclosure Statement and proposed confirmation schedule 

contemplating a June 2023 confirmation hearing, and confirmation of the Plan; (iii) filing a 

Confirmation Order reasonably satisfactory to the Required Lenders; (iv) causing the effective 

date of the Plan (the “Plan Effective Date”) to occur on or before December 1, 2023; (v) causing

the Series A Bonds to be tax-exempt to the extent permitted by law (including seeking any 

appropriate no-action or clearance determination from the Internal Revenue Service); and (vi) 

refraining from directly or indirectly commencing or supporting (or continuing to prosecute) any 

action or proceeding (including in the Priority Litigation), or asserting any claim or objection,

against any of the Fuel Line Lenders challenging their asserted priority, rights and claims as set 

forth in the pleadings filed in the Priority Litigation and the Fuel Line Lenders’ Proofs of Claim.

2

The FOMB shall respond to reasonable requests from the advisors to the Fuel Line Lenders as to 

(x) the status and progress of the Title III Case, including, without limitation, progress in relation 

to the negotiations of the Plan and Definitive Documents and (y) the status of obtaining any 

necessary or desirable authorizations (including any consents) with respect to the Plan and 

Definitive Documents, from any competent judicial body, governmental authority, banking, 

taxation, supervisory or regulatory body. The FOMB as representative of PREPA in the Title III 

Case shall not agree that Reorganized PREPA will provide a recovery to any creditor under the 

Plan that prevents satisfaction of the Term Sheet. 

(b) Covenants of the Fuel Line Lenders. From and after the date hereof, 

provided that (i) this Agreement has not been terminated and (ii) none of the Disclosure Statement, 

the Plan or any of the Definitive Documents have been filed, amended or modified in a manner

adverse to the Fuel Line Lenders and inconsistent with the provisions hereof, each of the Fuel Line 

Lenders, shall: (A) support (I) approval of the Disclosure Statement in accordance with section 

1125 of the Bankruptcy Code, and (II) confirmation of the Plan in accordance with section 1129 

of the Bankruptcy Code; (B) subject to receipt of the Disclosure Statement and other solicitation 

materials in respect of the Plan, as approved by the Title III Court, timely vote, or cause to be 

voted, all their claims to accept the Plan, in accordance with applicable orders of the Title III Court 

 2 For the avoidance of doubt, nothing in this Agreement shall preclude the Fuel Line Lenders from asserting or 

defending their rights and claims — including as to their “Current Expense” priority status — in connection with Plan 

confirmation or in any adversary proceeding filed by any party (including Adv. Pro. No. 19-00391). The Fuel Line 

Lenders shall thus be entitled to make submissions to the Title III Court in support of confirmation of the Plan and in 

connection with Adv. Pro. No. 19-00391, including submissions supporting their position that PREPA bondholders 

have at most a “net” revenue lien and claim and that the Fuel Line Lenders have enforceable priority rights vis-à-vis 

the PREPA bondholders. Notwithstanding the foregoingwhile this Agreement remains effective and prior to the 

Termination Date, the Fuel Line Lenders shall not support Sistema de Retiro de los Empleados de la Autoridad de 

Energía Eléctrica (“SREAEE”) or any other third party in opposing confirmation of the Plan, or in seeking relief in 

Adv. Pro. No. 19-00405 or any appeal therefrom (or another adversary proceeding or appeal addressing the “Current 

Expense” priority status of the claims of SREAEE or any other third party), based on SREAEE’s asserted “Current 

Expense” priority status under the Trust Agreement, provided that: (1) the FOMB, as the representative of PREPA in 

the Title III Case, shall waive any and all arguments that any claims, causes of action or positions of the Fuel Line 

Lenders are affected by any decision or order entered in litigation with SREAEE or any third party regarding the 

“Current Expense” priority, based on doctrines of issue preclusion, claim preclusion, law of the case or any similar 

doctrine; and (2) if the Termination Date occurs, the FOMB, as the representative of PREPA in the Title III Case, 

shall cooperate with the Fuel Line Lenders to set an expedited litigation schedule for disputes relating to the Fuel Line 

Lenders’ “Current Expense” priority status to be heard on the merits, and to use reasonable best efforts to ensure that 

any appeals relating to the Fuel Line Lenders’ “Current Expense” or priority status are heard by or at the same time 

as appeals relating to SREAEE’s “Current Expense” priority status. For the avoidance of doubt, the commitments 

shall survive termination of this Agreement. 

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regarding solicitation of votes on the Plan, and not change or withdraw (or cause to be changed or 

withdrawn) any such accepting vote; and (C) following the Plan Effective Date, move to dismiss 

the Priority Litigation with prejudice.

(c) Mutual Covenants. Each of the Parties, severally and not jointly, 

covenants that:

(i) Subject to the terms and conditions hereof, such Party shall support, 

and otherwise not encourage any other person to take any action which would, 

or would reasonably be expected to, breach or be inconsistent with the terms 

herein or impede or preclude the filing of the Plan, the administration of the 

Title III Case, the approval of the Disclosure Statement, and the entry of the 

Confirmation Order and the consummation, implementation and administration 

of the Plan, including the execution and delivery of the Definitive Documents, 

provided that such Disclosure Statement, Confirmation Order and Plan (and its 

consummation, implementation and administration) and the other Definitive 

Documents are consistent with the terms herein and the Plan.

(ii) Such Party shall endeavor to avoid litigation of the Fuel Line 

Lenders’ priority prior to the Title III Court’s consideration of its settlement in 

the Plan.

(iii) Such Party will cooperate and negotiate with each other in good 

faith and exercise reasonable best efforts with respect to the pursuit, approval, 

negotiation, execution, delivery, and implementation of the Definitive 

Documents that effectuate the terms set forth in the Term Sheet consistent in all 

respects with this Agreement. 

(iv) Notwithstanding any other provision herein, this Agreement is not 

and shall not be deemed to be an offer with respect to any securities or 

solicitation of votes for the acceptance of a plan of adjustment for purposes of 

PROMESA, sections 1125 and 1126 of the Bankruptcy Code or otherwise.

(v) Any such offer or solicitation will be made only in compliance with 

all applicable securities laws and provisions of PROMESA and the Bankruptcy 

Code, and will not be solicited until the Title III Court has approved the 

Disclosure Statement and related solicitation materials, and such Disclosure 

Statement and solicitation materials have been transmitted to parties entitled to 

receive same.

Section 5. Transfer of Claims and Interests.

(a) For the period commencing as of the Agreement Effective Date until 

the termination of this Agreement as to any Fuel Line Lender pursuant to the terms hereof, such 

Fuel Line Lender shall not sell, assign, transfer, or otherwise pledge or dispose of (“Transfer”) 

any Fuel Line Loans beneficially owned by such Fuel Line Lender, or any participation, voting, 

consent or direction rights related to such Fuel Line Loans, or any replacement thereof with trust 

certificates identifiable by a unique CUSIP in accordance with Section 7, except such Transfer 

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may be made (i) if the transferee is a Fuel Line Lender at the time of the Transfer or (ii) if the 

transferee is not a Fuel Line Lender at the time of the Transfer, such transferee (a transferee 

pursuant to this clause (ii) or the immediately preceding clause (i), a “Qualified Transferee”) (x) 

enters into engagement letters with the Fuel Line Lenders’ advisors without deviation from the 

engagement terms already agreed with the existing Fuel Line Lenders, if not already a party 

thereto, and (y) delivers to counsel to the FOMB and counsel to the Fuel Line Lenders, at or prior 

to the consummation of the Transfer, the joinder attached hereto as Exhibit B, pursuant to which 

such transferee shall assume all rights (including, without limitation, the right to the 

Consummation Costs, but not the right to the Professional Fee Reimbursement) and obligations 

(including, without limitation, the obligation to pay its pro rata share of fees and expenses due 

under the Fuel Line Facilities) of such Fuel Line Lender transferor hereunder (and such transferee

if not already a Fuel Line Lender, shall also be a “Fuel Line Lender” hereunder). To the extent a 

Transfer violates the provisions of this section, the Transfer shall be void ab initio and the 

applicable Fuel Line Loans and the Fuel Line Lender attempting the Transfer of the Fuel Line 

Loans shall continue to remain subject to the terms of this Agreement. This Agreement shall in 

no way be construed to preclude any of the Fuel Line Lenders from acquiring additional Fuel Line 

Loans; provided that any such acquired Fuel Line Loans shall automatically and immediately upon 

acquisition by a Fuel Line Lender be deemed subject to all terms of this Agreement.

(b) Notwithstanding anything contained in this Agreement to the contrary, 

(i) a Fuel Line Lender may Transfer any right, title or interest in the Fuel Line Loans or any trust 

certificates identifiable by a unique CUSIP for which Fuel Line Loans are exchanged in accordance 

with Section 7 to a Qualified Marketmaker (as defined below), acting in its capacity as a Qualified 

Marketmaker, without the requirement that such Qualified Marketmaker be or become a Fuel Line 

Lender; provided that such Qualified Marketmaker subsequently Transfers such right, title or 

interest in the Fuel Line Loans to a Fuel Line Lender or a Qualified Transferee within the date that 

is thirty (30) days after such Qualified Marketmaker’s acquisition of such right, title or interest; 

and (ii) to the extent that a Fuel Line Lender is acting in its capacity as a Qualified Marketmaker, 

it may Transfer any right, title or interest in the Fuel Line Loans that the Qualified Marketmaker 

acquires from a holder of the Fuel Line Loans that is not a Fuel Line Lender without the 

requirement that the transferee be or become a Fuel Line Lender.

(c) “Qualified Marketmaker” means an entity that (i) holds itself out to 

the market as standing ready in the ordinary course of its business to purchase from customers and 

sell to customers debt securities such as the Fuel Line Loans or any trust certificates identifiable 

by a unique CUSIP for which Fuel Line Loans are exchanged in accordance with Section 7 or 

enter with customers into long and short positions in debt securities such as the Fuel Line Loans, 

in its capacity as a dealer or market maker in such Fuel Line Loans; (ii) is in fact regularly in the 

business of making a market in debt securities; and (iii) if transacting with respect to Fuel Line 

Loans or trust certificates identifiable by a unique CUSIP for which Fuel Line Loans are exchanged 

in accordance with Section 7, is registered with the Securities and Exchange Commission and 

Financial Institutions Regulatory Authority.

(d) Any disclosures by any Fuel Line Lender to any other Party of its 

holdings of Fuel Line Loans shall be treated as confidential information by such other Party unless 

such other Party receives such information through other means that are not subject to a duty of 

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confidentiality. The foregoing shall not prohibit the FOMB from disclosing the aggregate 

principal amount of Fuel Line Loans held by the Fuel Line Lenders collectively.

(e) The Fuel Line Lenders as of the date hereof are listed on Annex A

hereto, along with their current holdings of Fuel Line Loans under each of the Fuel Line Facilities. 

Fuel Line Lenders may be added or removed from this Agreement from to time to time, in 

accordance with the terms of this Agreement upon delivery by counsel to the Fuel Line Lenders

of a notice to the FOMB with an updated Annex A, and, in the case of the addition of a person to 

the Fuel Line Lenders who is not otherwise party to this Agreement, execution by such person of 

a joinder in the form of Exhibit B hereto and delivery of such joinder to counsel to the FOMB and 

counsel to the Fuel Line Lenders. 

(f) In furtherance of the foregoing, the FOMB shall take, and use its 

reasonable best efforts to cause PREPA to take, all actions necessary to consent to assignments of 

the Fuel Line Loans in accordance with the Fuel Line Facilities and this Section 5, as applicable. 

Section 6. Representations and Warranties.

6.01. Mutual Representations and Warranties. Each Party hereby, severally and not 

jointly, represents and warrants to the other Parties that the following statements are true and 

correct as of the date hereof (or in the case of a Qualified Transferee that is not a Fuel Line Lender 

as of the date hereof, the date such Qualified Transferee becomes a Fuel Line Lender):

(a) such Party has the legal right, power and authority to enter into this 

Agreement;

(b) such Party is duly organized and validly existing and in good standing 

under the laws of the jurisdiction of its organization with full power and authority to execute and 

deliver, and to perform and observe the terms and provisions of, this Agreement; and

(c) the execution, delivery, performance and observance of this Agreement 

by such Party (i) has been duly authorized by all necessary action on the part of such Party, does

not and will not conflict with, or result in a violation of, any law applicable to it, and does not 

require it to obtain any permit, consent, approval, order or authorization of, or provide notice to or 

make a filing with, any court, governmental or regulatory agency or authority or other person or 

entity that has not been obtained, provided or made, as applicable, (ii) except to the extent 

modified, stayed or otherwise excused by PROMESA, (A) with respect to the FOMB, does not 

contravene, or constitute a default under, any provision of applicable law or regulation or of any 

agreement, judgment, injunction, order, decree or other instrument binding on the FOMB, as 

applicable and (B) with respect to each Party, do not and will not violate, conflict with, or result 

in the breach of any provision of its organizational or governance documents and (iii) does not and 

will not result in any breach of, constitute a default (or event which with the giving of notice or 

lapse of time, or both, would become a default) under, require any consent under or give to others 

any rights of termination, amendment, acceleration, suspension, revocation or cancellation of, any 

note, bond, mortgage, indenture, contract, agreement, lease, sublease, license, permit, franchise or 

other instrument or arrangement to which it is a party, which would materially adversely affect its 

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ability to carry out its obligations under and otherwise observe this Agreement or cause the 

occurrence of a Termination Event.

6.02. Additional Representations of Fuel Line Lenders. Each Fuel Line Lender severally 

and not jointly represents, warrants, and covenants to each other Party that the following 

statements are true, correct, and complete as of the date of this Agreement (or in the case of a 

Qualified Transferee that is not a Fuel Line Lender as of the date hereof, the date such Qualified 

Transferee becomes a Fuel Line Lender) (each of which is a continuing representation, warranty, 

and covenant): that it beneficially owns or has investment management responsibility for accounts 

that beneficially own Fuel Line Loans in the principal amounts set forth on its respective signature 

page hereto or joinder to this Agreement in the form of Exhibit B (as applicable), which it would 

be entitled to vote in a plan solicitation, and that it has not sold, assigned, transferred, participated 

or otherwise pledged such Fuel Line Loans, or any voting, consent or direction rights related to 

such Fuel Line Loans, to any other person or entity, that would prevent or adversely affect in any 

way such Fuel Line Lender’s performance of its obligations contained in this Agreement at the 

time such obligations are required to be performed, in each case, except as permitted by Section 5 

of this Agreement.

Section 7. Conversion to Trust Certificates. The FOMB covenants to employ its reasonable 

best efforts to cause the exchange of the Fuel Line Loans beneficially owned by the Fuel Line 

Lenders for trust certificates identifiable by a unique CUSIP prior to January 31, 2023. Any such 

replacement trust certificates shall remain Fuel Line Loans for all purposes of this Agreement and 

any holder thereof shall be bound by all applicable provisions of this Agreement.

Section 8. Amendments and Waivers. The terms and conditions of this Agreement, including 

any exhibits, annexes or schedules to this Agreement, may not be waived, modified, amended, or 

supplemented without the written consent of (a) the FOMB and (b) the Fuel Line Lenders that 

beneficially own or control, in the aggregate, at least two-thirds in principal amount of the 

aggregate amount of the Fuel Line Loans outstanding under the Fuel Line Facilities at such time; 

provided that, (i) if any material provision of the Term Sheet (or the Plan incorporating the Term 

Sheet) or of Sections 5 or 9 of this Agreement is materially amended, modified, supplemented or 

waived without the written consent of a Fuel Line Lender in a manner materially adverse to such 

Fuel Line Lender, then such Fuel Line Lendershall have the right to withdraw from this Agreement 

in accordance with Section 9.02(d) hereof and (ii) that any waiver, modification, amendment or 

supplement to this Section 8 shall require the written consent of the FOMB and each Fuel Line 

Lender.

Section 9. Termination.

9.01. Mutual Consent. This Agreement may be terminated by the mutual consent of 

(a) the FOMB and (b) the Required Lenders. 

9.02. Termination Events. 

(a) This Agreement may be terminated by (x) the FOMB or (y) the 

Required Lenders, in each case upon five (5) business days’ prior written notice delivered to the 

other aforementioned Parties after the occurrence of any of the following events (each, a 

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“Termination Event”); provided, however, that this Agreement may be terminated solely by the 

Required Lenders (and not the FOMB) upon the occurrence of the Termination Event set forth in 

clauses (ii), (iv), (v), (vii), (xi), (xii), (xiii) and (xiv) below, solely by the FOMB (and not the Fuel 

Line Lenders) upon the occurrence of the Termination Event set forth in clauses (vi) and (viii) 

below, and solely by a non-breaching Party (and not the other Parties) upon the occurrence of the 

Termination Event set forth in clause (i) below:

(i) following the delivery of written notice thereof by a nonbreaching Party, the occurrence of a material breach by any of the Parties of any of its obligations, 

representations, warranties, covenants or commitments set forth in this Agreement that is either 

unable to be cured or is not cured within five (5) business days following the delivery of such 

notice; provided that the FOMB cannot terminate this Agreement under this Section 9.02(a)(i) so 

long as the non-breaching Fuel Line Lenders (A) are more than one-half in number of the Fuel 

Line Lenders, (B) beneficially own or control, in the aggregate, at least two-thirds of the FLL 

Prepetition Claim Amount, and (C) the breaching Fuel Line Lender(s) or its successors do not file 

or prosecute a confirmation objection or other litigation that could render the Plan unconfirmable;

(ii) the FOMB publicly disavows any of the terms set forth in this 

Agreement (including on the Term Sheet) or enters into, or publicly supports, a proposed 

transaction, disclosure statement, plan of adjustment, legislation, confirmation order or definitive 

documentation in connection therewith (by amendment or otherwise) materially inconsistent with 

such terms;

(iii) the dismissal of the Title III Case;

(iv) the determination by the FOMB (A) not to proceed with the 

transactions materially consistent with those contemplated by the Agreement or (B) to proceed 

with a transaction that would be materially inconsistent with the terms of, or the transactions 

contemplated by, this Agreement;

(v) the Plan Effective Date does not occur on or before December 1, 

2023;

(vi) the Fuel Line Lenders cease to collectively beneficially own or 

control, in the aggregate, at least two-thirds of the FLL Prepetition Claim Amount;

(vii) the FOMB directly or indirectly commences or supports (or 

continues to prosecute) any action or proceeding (including in the Priority Litigation), or asserts

any claim or objection, against any of the Fuel Line Lenders challenging their asserted priority, 

rights and claims as set forth in the pleadings filed in the Priority Litigation and the Fuel Line 

Lenders’ Proofs of Claim; provided, for the avoidance of doubt, any opposition by the FOMB to 

any priority asserted by SREAEE or any other entity shall not be a Termination Event; 

(viii) any of the Fuel Line Lenders continues or attempts to continue

the Priority Litigation against the FOMB or PREPA; 

(ix) the Title III Court enters an order (A) granting any relief that 

would impair the Parties’ ability to perform their respective obligations under this Agreement in 

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10

any material respect, including, without limitation, denying confirmation of the Plan or (B) that is

materially inconsistent with the Term Sheet; 

(x) the Title III Court approves either the Motion of the Ad Hoc 

Group of PREPA Bondholders, Assured Guaranty Corp., Assured Guaranty Municipal Corp., 

National Public Finance Guarantee Corporation, and Syncora Guarantee, Inc. to Dismiss 

PREPA’s Title III Case, or for Relief from the Automatic Stay to Enforce Their Right to a Receiver 

(Docket Entry No. 22291 in Case No. 17-3283 and Docket Entry No. 2973 in Case No. 17-4780)

or the Motion of the Ad Hoc Group of PREPA Bondholders, Assured Guaranty Corp., Assured 

Guaranty Municipal Corp., National Public Finance Guarantee Corporation, and Syncora 

Guarantee, Inc. for Authorization to File a Combined Motion to Dismiss PREPA’s Title III Case 

and Alternative Request for Relief from the Automatic Stay (Docket Entry No. 2971 in Case No. 

17-4780); 

(xi) the Puerto Rico Energy Bureau (“PREB”) denies the Transition 

Charge and the Title III Court does not require PREB to reverse its decision within sufficient time 

to allow the Plan Effective Date to occur on or before December 1, 2023; 

(xii) the Confirmation Order is reversed, dismissed, or vacated 

without the prior written consent of the Required Lenders and the Title III Court does not within 

ninety (90) days enter a revised order confirming the Plan reasonably acceptable to the FOMB and 

the Required Lenders; 

(xiii) the Disclosure Statement has not been approved on or before 

April 30, 2023; or

(xiv) the Confirmation Order has not been approved by the Title III 

Court on or before August 31, 2023.

(b) This Agreement shall automatically terminate on the Plan Effective 

Date.

(c) The date on which this Agreement is terminated in accordance with the 

provisions of Section 9.01, Section 9.02(a) or Section 9.02(b) shall be referred to as the 

“Termination Date”. On the Termination Date, the provisions of this Agreement shall terminate, 

except as otherwise provided in this Agreement, unless the FOMB and the Required Lenders

waive, in writing, the occurrence of the Termination Event giving rise to the occurrence of such 

Termination Date. Notwithstanding (1) any Transfer of Fuel Line Loans in accordance with this 

Agreement or (2) the termination of this Agreement in accordance with its terms, the agreements 

and obligations of the parties in Section 10 (other than Section 10.03) and any confidentiality 

agreement in place prior to the date hereof between the FOMB and any Fuel Line Lender shall 

survive such Transfer and/or termination and shall continue in full force and effect for the benefit 

of the Parties in accordance with the terms hereof and thereof.

(d) If any material provision of the Term Sheet (or the Plan incorporating 

the Term Sheet) or of Section 5 or this Section 9 is materially amended, modified, supplemented 

or waived without the written consent of a Fuel Line Lender in a manner materially adverse to 

such Fuel Line Lender, such Fuel Line Lender shall have the right to withdraw from this 

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Agreement within five (5) business days of receiving notice of such amendment, modification, 

supplement or waiver by delivering notice of such withdrawal to counsel to the FOMB and counsel 

to the Fuel Line Lenders. Such withdrawal shall be effective two (2) business days after delivery 

of such notice of withdrawal (to the extent such amendment or withdrawal are not rescinded), 

whereupon this Agreement shall terminate solely as to such Fuel Line Lender and such Fuel Line 

Lender shall no longer be a Party hereto.

(e) If at any time a Fuel Line Lender is no longer the beneficial owner of 

any Fuel Line Loans subject to this Agreement as a result of a Transfer that complies with Section 

5 hereof, then this Agreement shall terminate solely as to such Fuel Line Lender, and such Fuel 

Line Lender shall no longer be a Party hereto unless and until such Fuel Line Lender subsequently 

becomes a beneficial owner of any Fuel Line Loans whereupon it will automatically be deemed to 

be a Fuel Line Lender under this Agreement. 

(f) No Party may terminate this Agreement upon a Termination Event if 

such Termination Event is the result of such Party unreasonably failing to perform or comply in 

any material respect with the terms and conditions of this Agreement; provided, however, that 

nothing in this Section 9 shall relieve any Party of liability for any breach or non-performance of 

this Agreement occurring prior to the Termination Date.

Section 10. Miscellaneous.

10.01. Entire Agreement. This Agreement constitutes the entire agreement among the 

Parties with respect to the settlement of the Priority Litigation, the Plan, and the restructuring 

process contemplated herein and supersedes all prior oral or written agreements, statements, and 

acts among the Parties with respect thereto. Notwithstanding the forgoing, to the extent a Fuel 

Line Lender entered into a confidentiality agreement with the FOMB prior to the date hereof, the 

terms of such confidentiality agreement shall continue to apply and remain in full force and effect 

according to its terms, and this Agreement does not supersede any rights or obligations otherwise 

arising under such confidentiality agreements.

10.02. Only Express Releases. No Party waives or releases any rights except as expressly 

provided herein. 

10.03. Further Assurances. Subject to the other terms of this Agreement, the Parties agree 

to execute and deliver such other instruments and perform such acts, in addition to the matters 

specified herein, at their own expense, as may be reasonably appropriate or necessary, or as may 

be required by order of the Title III Court from time to time, to effectuate the terms of this 

Agreement.

10.04. Headings. The headings of all sections of this Agreement are inserted solely for 

the convenience of reference and are not a part of and are not intended to govern or limit any term 

or provision hereof. Headings may aid in interpretation solely to the extent not inconsistent with 

express provisions of this Agreement.

10.05. GOVERNING LAW; SUBMISSION TO JURISDICTION; SELECTION OF 

FORUM. THIS AGREEMENT IS TO BE GOVERNED BY AND CONSTRUED IN 

ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO 

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CONTRACTS MADE AND TO BE PERFORMED IN SUCH STATE, WITHOUT GIVING 

EFFECT TO ANY CONFLICT OF LAWS PRINCIPLES THEREOF THAT WOULD RESULT 

IN THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION. Each Party shall 

bring any action or proceeding in respect of any claim arising out of or related to this Agreement 

in the Title III Court (or court of proper appellate jurisdiction) (the “Chosen Court”), and solely 

in connection with claims arising under this Agreement: (a) irrevocably submits to the subject 

matter and personal jurisdiction of the Chosen Court; (b) waives any objection to laying venue in 

any such action or proceeding in the Chosen Court; and (c) waives any objection that the Chosen 

Court is an inconvenient forum or does not have jurisdiction over any Party hereto. If the Title III 

Court determines it lacks subject matter jurisdiction and the determination becomes final and no 

longer subject to appeal, the action shall be brought in the United States District Court for the 

Southern District of New York if it has subject matter jurisdiction, and otherwise brought in the 

New York Supreme Court in Manhattan.

10.06. Trial by Jury Waiver. EACH PARTY HERETO IRREVOCABLY WAIVES ANY 

AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF 

OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED 

HEREBY.

10.07. Execution of Agreement. This Agreement may be executed and delivered in any 

number of counterparts and by way of electronic signature and delivery, each such counterpart, 

when executed and delivered, shall be deemed an original, and all of which together shall constitute 

the same agreement. Except as expressly provided in this Agreement, each individual executing 

this Agreement on behalf of a Party has been duly authorized and empowered to execute and 

deliver this Agreement on behalf of said Party.

10.08. Rules of Construction. When a reference is made in this Agreement to a section or 

exhibit, such reference shall be to a section or exhibit, respectively, of or attached to this 

Agreement unless otherwise indicated. Unless the context of this Agreement otherwise requires, 

(a) words using the singular or plural number also include the plural or singular number, 

respectively, (b) the terms “hereof,” “herein,” “hereby” and derivative or similar words refer to 

this entire Agreement, (c) the words “include,” “includes” and “including” when used herein shall 

be deemed in each case to be followed by the words “without limitation,” and (d) the word “or” 

shall not be exclusive and shall be read to mean “and/or.” “Writing,” “written” and comparable 

terms refer to printing, typing and other means of reproducing words (including electronic media) 

in a visible form, and any requirement that any notice, consent or other information shall be 

provided “in writing” shall include email. Any reference to “business day” means any day, other 

than a Saturday, a Sunday or any other day on which banks located in New York, New York are 

closed for business as a result of federal, state or local holiday and any other reference to day 

means a calendar day. 

10.09. Interpretation; Representation by Counsel. This Agreement is the product of 

negotiations among the Parties and in the enforcement or interpretation hereof, is to be interpreted 

in a neutral manner, and any presumption with regard to interpretation for or against any Party by 

reason of that Party having drafted or caused to be drafted this Agreement, or any portion hereof, 

shall not be effective in regard to the interpretation hereof. The Parties were each represented by 

counsel during the negotiations and drafting of this Agreement and continue to be represented by 

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counsel and, therefore, waive the application of any law, regulation, holding or rule of construction 

(a) providing that ambiguities in an agreement or other document shall be construed against the 

party drafting such agreement or document or (b) any Party with a defense to the enforcement of 

the terms of this Agreement against such Party based upon lack of legal counsel.

10.10. Successors and Assigns; No Third Party Beneficiaries. This Agreement is intended 

to bind and inure to the benefit of the Parties and their respective successors and permitted assigns, 

as applicable. There are no third party beneficiaries under this Agreement, and the rights or 

obligations of any Party under this Agreement may not be assigned, delegated, or transferred to 

any other person or entity, except as permitted herein. 

10.11. Notices. All notices hereunder shall be deemed given if in writing and delivered 

by electronic mail, courier, or registered or certified mail (return receipt requested) (and if by any 

method other than electronic mail, then with a copy by electronic mail) to the following addresses 

(or at such other addresses as shall be specified by like notice):

(a) if to the FOMB, to:

Proskauer Rose LLP

11 Times Square 

New York, NY 10036

Attention: Martin Bienenstock, Paul V. Possinger, and Ehud Barak

Email: mbienenstock@proskauer.com; 

ppossinger@proskauer.com; ebarak@proskauer.com

(b) if to the Fuel Line Lenders, to:

Wachtell, Lipton, Rosen & Katz

51 West 52nd Street

New York, New York 10019

Attention: Richard Mason and Stephanie Marshak

Email: rgmason@wlrk.com; samarshak@wlrk.com

or such other address as may have been furnished by a Party to each of the other Parties by notice 

given in accordance with the requirements set forth above. Any notice given by delivery, mail 

(electronic or otherwise), or courier shall be effective when received. 

10.12. Independent Analysis. Each Party confirms its decision to execute this Agreement 

has been based upon its independent assessment of documents and information available to it, as 

it has deemed appropriate.

10.13. Waiver. Except as expressly provided herein, no Party shall be deemed to have 

waived any rights as a result of its entry into this Agreement, and, if this Agreement is terminated 

for any reason, the Parties fully reserve any and all of their rights. 

10.14. Relationship Among Parties. Notwithstanding anything herein to the contrary, 

(a) the agreements, representations, warranties, liabilities, duties, and obligations of the Parties 

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under this Agreement are, in all respects, several and not joint and several, (b) no Party shall have 

any responsibility by virtue of this Agreement for any trading by any other entity; (c) no prior 

history, pattern, or practice of sharing confidences among or between the Parties shall in any way 

affect or negate this Agreement; (d) the Parties hereto acknowledge this Agreement does not 

constitute an agreement, arrangement or understanding with respect to acting together for the 

purpose of acquiring, holding, voting or disposing of any securities of PREPA and the Parties do 

not constitute a “group” within the meaning of Rule 13d-5 under the Securities Exchange Act of 

1934, as amended; (e) none of the Parties shall have any fiduciary duty, any duty of trust or 

confidence in any form, or other duties or responsibilities in any kind or form to each other; and 

(f) no action taken by any Party pursuant to this Agreement shall be deemed to constitute or to 

create a presumption by any of the Parties that the Parties are in any way acting in concert or as 

such a “group.” 

10.15. Specific Performance. Each of the Parties acknowledges that money damages are 

an insufficient remedy for any breach of this Agreement by any Party and each non-breaching 

Party shall be entitled to seek specific performance and injunctive or other equitable relief as a 

remedy of any such breach of this Agreement, including, without limitation, an order of the Title 

III Court or such other court of competent jurisdiction requiring any Party to comply promptly 

with any of its obligations hereunder. Notwithstanding anything contained in this Agreement to 

the contrary, specific performance and injunctive or other similar relief and the right to terminate 

this Agreement in accordance with the terms and provisions hereof shall be the sole and exclusive 

remedies for any breach of this Agreement by any Party (or any other person) and no Party (or any 

other person) shall be entitled to monetary damages for any breach of any provision of this 

Agreement. For the avoidance of doubt, any consent right, termination right or withdrawal right 

provided to a Fuel Line Lender under this Agreement shall be cumulative to, and not in lieu of, 

any other consent right, termination right or withdrawal right provided to such Fuel Line Lender

hereunder. The Parties acknowledge and agree that the giving of notice of termination by any Fuel 

Line Lender in accordance with this Agreement shall not be a violation of the automatic stay; 

provided that nothing herein shall prejudice any rights to argue that the giving of notice of 

termination was not in accordance with the terms of this Agreement. 

10.16. Severability and Construction. If any provision of this Agreement shall be held by 

a court of competent jurisdiction to be illegal, invalid, or unenforceable, in whole or in part, the 

Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of 

the Parties as closely as possible in a reasonably acceptable manner in order that the transactions 

contemplated hereby are consummated as originally contemplated to the greatest extent possible

if the new agreement provides each Party with an economic outcome not materially adverse to its 

original economic outcome. If the same economics are not reconstructed without material change, 

this Agreement shall terminate with each Party restored to its rights upon entering into this 

Agreement.

10.17. Public Disclosure. Any public filing of this Agreement, with the Title III Court or 

otherwise, that includes executed signature pages to this Agreement shall include such signature 

pages only in redacted form with respect to the Fuel Line Loans held by each Fuel Line Lender. 

For the avoidance of doubt, nothing in this Agreement absolves the Fuel Line Lenders from their 

duties to comply with Bankruptcy Rule 2019 and the Case Management Order in the Title III Case. 

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10.18. Settlement Discussions. This Agreement is part of a proposed settlement of matters 

that could otherwise be the subject of litigation among the Parties. This Agreement is the product 

of the mediation ordered by the Title III Court on April 8, 2022, and all negotiations relating thereto 

are subject to the Order Establishing the Terms and Conditions of Mediation (Docket Entry No. 

2773 in Case No. 17-4780), as such order is amended, restated, supplemented, or otherwise 

modified from time to time. In addition, pursuant to Rule 408 of the Federal Rules of Evidence, 

any applicable state rules of evidence and any other applicable law, foreign or domestic, this 

Agreement and all negotiations relating thereto shall not be admissible into evidence in any 

proceeding other than a proceeding to enforce its terms.

[Remainder of page intentionally left blank.]

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[Signature Page to Plan Support and Settlement Agreement] 

IN WITNESS WHEREOF, the Parties have executed this Agreement on the day and 

year first above written.

Financial Oversight and Management Board for 

Puerto Rico 

By: 

Name:

Title:

Jaime A. El Koury

General Counsel

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[Signature Page to Plan Support and Settlement Agreement]

[FUEL LINE LENDERS’ SINGATURE PAGES REDACTED]

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Exhibit A

Term Sheet

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PLAN TERM SHEET

This Plan Term Sheet does not address all material terms that would be required in definitive documents and to 

consummate the transactions set forth in the Plan Support and Settlement Agreement (the “PSA” or the 

“Agreement”), to which this Plan Term Sheet is annexed, and this Plan Term Sheet, which terms shall be mutually 

agreed on by the Parties. Nothing in this Plan Term Sheet shall constitute a binding commitment of any Party or 

constitute an admission or representation of any fact or circumstance or an admission of any liability or waiver of 

any right or claim. Unless and until the execution of definitive documentation, the Parties shall retain their respective 

rights. If executed, the terms of such definitive documentation will control. This Plan Term Sheet is not (nor shall it 

be construed as) an offer with respect to any securities or solicitation of votes for the acceptance of a plan of 

adjustment for purposes of PROMESA, sections 1125 and 1126 of the Bankruptcy Code or otherwise. 

Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the PSA. 

CLAIM 

ALLOWANCE AND 

CLASSIFICATION

 The Fuel Line Lenders’ claims will be deemed allowed (not subject to 

challenge, objection or revocation) in the FLL Prepetition Claim 

Amount and will collectively be treated as one class of claims, distinct 

from all other classes of claims, without any distinction in treatment as 

between the claims arising under the Scotia Line and the Citi Line.

INTEREST 

ACCRUAL

 The Fuel Line Lenders shall be entitled to interest on the Series A

Bonds to be issued to them under the Plan at the Exchange Ratio 

below, the accrual of which shall commence upon the Agreement 

Effective Date and continue through the Plan Effective Date, at a rate 

of 6.0% per annum; provided, the amount of interest accrued prior to 

the Plan Effective Date shall not exceed one (1) year of accrual. The 

accrued interest hereunder shall be payable upon the Plan Effective 

Date in the form of additional Series A Bonds or cash, at the FOMB’s 

sole discretion.

EXCHANGE RATIO  84% of FLL Prepetition Claim Amount, to be paid in Series A Bonds.

NEW BONDS  Other than cash consideration paid on the Plan Effective Date, 

reorganized PREPA (“Reorganized PREPA”) shall issue on the Plan 

Effective Date to PREPA’s creditors only Series A Bonds, Series B

Bonds, or other bonds as long as such other bonds (a) are subordinate 

in principal payment priority to the Series A Bonds, (b) do not in any 

way affect the terms of the Series A Bonds as set forth in this Term 

Sheet, and (c) are not secured by any collateral not pledged as security 

for the Series A Bonds. 

TRANSITION 

CHARGE

 Transition Charge means a hybrid connection charge and volumetric 

charge to be added to customers’ bills to pay the New Bonds, in 

structure and amounts that do not change the Series A Bonds’ expected 

repayment date and expected weighted average life as set forth herein, 

and otherwise that are reasonably acceptable to the Required Lenders.

SERIES A BONDS  Series A Bonds, which will be issued only to the Fuel Line Lenders,

will have first priority of principal repayment following payment of 

accrued interest on all outstanding New Bonds.

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 If unpaid at the Series A Bonds’ Final Maturity, the Series A Bonds 

will remain outstanding until paid in full in cash, but will cease 

accruing interest as of the Series A Bonds’ Final Maturity.

SERIES B BONDS  Series B Bonds shall be distributed to (a) holders of Fuel Line Loans in 

an amount up to the Remaining Claims of the Fuel Line Lenders and 

on the satisfaction of the conditions set forth below under Treatment 

Protections and (b) other creditors of PREPA.

 No principal shall be paid on the Series B Bonds until the Series A

Bonds have been paid in full in cash. Thereafter, Series B Bonds shall 

receive 100% of the Transition Charge revenues, which shall be 

applied first to interest due and owing, and second to principal. 

 If unpaid at the Series B Bonds’ Final Maturity, the Series B Bonds 

will remain outstanding until paid in full in cash, but will cease 

accruing interest as of the Series B Bonds’ Final Maturity.

FINAL MATURITY  Series A Bonds: 15 year stated final maturity1 (5 year expected 

repayment; 3 year expected weighted average life).

 Series B Bonds: 50 year stated final maturity (35 year expected 

repayment).

Expected repayment periods are based on Fiscal Plan demand, 

customer data and rates included in the FOMB’s November 8, 2022 

proposal to the Fuel Line Lenders, subject to the Payment Waterfall.

COUPON  Series A Bonds: 6.00% cash interest

 Series B Bonds: 6.00% cash interest

TAX TREATMENT  Series A Bonds: Tax-exempt

 Series B Bonds: Tax-exempt

CALL 

PROTECTION

 Series A Bonds: Callable after 10 years at par

 Series B Bonds: Callable after 10 years at par

SECURITY  The New Bonds shall be secured by, and paid solely from, 

Reorganized PREPA’s net revenues, and the right to receive such net 

revenues, up to the amount of the Transition Charge revenues, in 

accordance with the Payment Waterfall. For the avoidance of doubt, 

the New Bonds’ liens and claims are not limited to the net revenues 

deposited in the Debt Service Fund. 

ACCOUNTS AND 

PAYMENT 

WATERFALL

 All revenues shall be deposited in the general fund held by 

Reorganized PREPA.

 1 Subject to modification based on agreed upon covenants and Transition Charge, to be negotiated among the Parties. 

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 On the first business day of each month, Reorganized PREPA shall 

apply amounts in the following order of priority (the “Payment 

Waterfall”):

- First, to the payment of Operating Expenses;2

- Second, to the payment of New Bond trustee fees and expenses not 

to exceed $100,000 per year;

- Third, to the Debt Service Fund (as defined below) up to the 

amount of the Transition Charge revenues (to be distributed in 

accordance with the provisions hereof);

- Fourth, to the payment of capital expenditures;

- Fifth, to the payment of subordinate debt (if any); and

- Sixth, for general corporate purposes. 

DEBT SERVICE

FUND 

 From and after the Plan Effective Date, until the New Bonds have been 

paid or satisfied in full in accordance with their terms, Reorganized 

PREPA shall deposit, in accordance with the Payment Waterfall, 

monies up to the amount of the Transition Charge revenues to the 

credit of the “Debt Service Fund” which shall be held by the New 

Bond trustee. Such monies deposited in the Debt Service Fund shall 

be applied, to the extent available, by the New Bond trustee:

- First, to the payment of stated interest due and payable on 

the New Bonds;

- Second, to the payment of principal on the Series A Bonds 

until repaid; and 

- Third, to the payment of principal on the Series B Bonds.

INTEREST RATE 

COVENANT

 Until the earlier of repayment of the Series A Bonds or the Final 

Maturity of the Series A Bonds, if, in any given year, the Transition 

Charge revenues deposited in the Debt Service Fund are insufficient to 

satisfy the interest due and owing on the New Bonds that fiscal year, 

Reorganized PREPA shall (and absent Reorganized PREPA’s action, 

the New Bond trustee or a receiver on behalf of the New Bonds shall) 

(a) exercise its powers to the fullest extent of the law to implement an 

 2 “Operating Expenses” shall mean Reorganized PREPA’s reasonable and necessary current expenses of maintaining, 

repairing and operating the system and shall include, without limiting the generality of the foregoing, all administrative 

expenses, insurance premiums, expenses of preliminary surveys not chargeable to capital expenditures, engineering 

expenses relating to operation and maintenance, legal expenses, any payment to pension, pension trust, or retirement 

funds, and all other expenses required to be paid by Reorganized PREPA under the provisions of the definitive 

documentation governing the New Bonds or by law, or permitted by standard practices for public utility systems, plus 

a reserve of up to two months of expenditures for the foregoing as reasonably estimated by Reorganized PREPA from 

time to time.

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increase in the Transition Charge sufficient to repay such interest due 

and payable on the New Bonds in the succeeding fiscal year and/or (b) 

initiate a rate case before PREB or any other proceeding to compel 

PREB to implement an increase in the Transition Charge sufficient to 

repay such interest due and payable on the New Bonds in the 

succeeding fiscal year (the “Interest Rate Covenant”).

PAYMENT 

DEFAULT

 There shall be no event of default on the New Bonds for failure to pay 

scheduled debt service prior to the Final Maturity, as applicable, so 

long as Reorganized PREPA (a) charges and employs its reasonable 

best efforts to collect revenues generated by the Transition Charge, and 

the full amount collected under the Transition Charge is deposited into 

the Debt Service Fund in accordance with the Payment Waterfall and 

(b) complies with the Interest Rate Covenant.

REMEDIES  Upon the occurrence of an event of default, the New Bond trustee’s 

sole remedies shall be to: (a) seek enforcement of Reorganized 

PREPA’s obligation to take reasonable measures to collect revenues 

generated by the Transition Charge and deposit such monies received 

into the Debt Service Fund in accordance with the Payment Waterfall,

and/or (b) prior to the Final Maturity, as applicable, at the request of 

25% or more of the Series A Bonds, enforce the Interest Rate 

Covenant. 

 The Plan and New Bond Indenture shall provide the “Right to 

Receivership Upon Default,” codified at 22 L.P.R.A. § 207, is 

preempted and waived. There shall be no right of acceleration under 

the New Bonds other than an acceleration in connection with an

insolvency proceeding (including under Title III of PROMESA).

 The FOMB shall use reasonable best efforts to obtain PREB approval 

and court ordered protections for the Interest Rate Covenant and 

Reorganized PREPA’s obligations to charge, collect, and pay 

Transition Charge revenues as provided herein. For the avoidance of 

doubt, reasonable best efforts with respect to the foregoing sentence 

includes incorporating such protections in the draft Confirmation 

Order filed with the Title III Court. 

TREATMENT 

PROTECTIONS

 If the FOMB and PREPA prevail in, or agree to a settlement of, the 

litigation against PREPA’s bondholders [Adv. Pro. No. 19-00391], and 

as a result there exist Series B Bonds to be issued under the Plan

available for distribution in excess of Series B Bonds allocated for 

initial treatment of claims, the Remaining Claim3 of the Fuel Line 

Lenders (which equals 16% of the FLL Prepetition Claim Amount)

will receive such excess Series B Bonds on a pro-rata basis with the 

 3

 “Remaining Claim” means, with respect to any allowed claim, the amount of such allowed claim that is unpaid, 

after subtracting from the total amount of the allowed claim, the treatment, if any, such holder has received on account 

of such allowed claim at the time the Remaining Claim is calculated.

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Exhibit M Page 26 of 32
Remaining Claims of unsecured creditors of PREPA (including the 

Remaining Claims of any class of settling bondholders and pension 

claims); provided the Fuel Line Lenders shall not receive New Bonds 

exceeding the FLL Prepetition Claim Amount except as provided 

below for Consummation Costs and Professional Fee Reimbursement, 

as applicable.

FEDERALLYDECLARED 

DISASTERS 

 In the event of a Federally-declared disaster as a result of a storm or 

other catastrophic event that disrupts Reorganized PREPA’s operations

such that Reorganized PREPA cannot collect Transition Charge 

revenue necessary to cover Operating Expenses and the debt service 

payable on the New Bonds for a given fiscal year, Reorganized PREPA 

may elect, in its sole discretion, to defer debt service on up to two (2) 

consecutive semi-annual debt service payments. 

 For the avoidance of doubt, if Reorganized PREPA exercises such 

election, interest on the New Bonds will continue to accrete until paid. 

All deferred principal and interest related to such Series A Bonds 

impacted by such election shall be paid on or before the earlier of the 

Series A Bonds’ Final Maturity or five (5) years after the end of such 

debt service deferral period.

DEFINITIVE 

DOCUMENTATION

 The New Bonds shall be documented under an indenture or trust 

agreement on the terms set forth in the Agreement and this Term 

Sheet and otherwise on terms customary for transactions of this type, 

as negotiated among the Fuel Line Lenders, the FOMB and other 

prospective holders of Series B Bonds pursuant to the Plan, as 

appropriate, which terms shall be reasonably acceptable to the FOMB 

and the Required Lenders. Without limiting the foregoing, the New 

Bonds, when issued, shall be subject to an “additional bonds test” to 

be agreed upon among the Parties in the Definitive Documents.

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CONSUMMATION 

COSTS AND 

PROFESSIONAL 

FEE 

REIMBURSEMENT

 In consideration for the Fuel Line Lenders’ assistance in formulating 

the plan of adjustment and to compensate for the reasonable fees and 

expenses incurred in negotiating and executing the Agreement, and 

definitively documenting such Agreement, the Fuel Line Lenders shall 

receive (a) consummation costs of $15 million and (b) reimbursement 

of up to $11 million in documented professional fees, payable upon the 

Plan Effective Date in the form of additional Series A Bonds or cash, 

at the FOMB’s sole discretion. The Consummation Costs will be 

payable pro rata to each Fuel Line Lender, including Qualified 

Transferees after they become Fuel Line Lenders in accordance with 

Section 5 of the Agreement. The Professional Fee Reimbursement will 

be allocated as follows: 10% to the Fuel Line Lender of record as of 

the Agreement Effective Date (party to the PSA as of the Agreement 

Effective Date) under the Citi Line and 90% to Fuel Line Lenders 

(party to the PSA as of the Agreement Effective Date) under the Scotia 

Line (and pro rata among such Fuel Line Lenders). For the avoidance 

of doubt, the Professional Fee Reimbursement will not be payable to 

Qualified Transferees. 

RELEASE  The Parties shall release each other to the maximum extent permitted 

by law. At the request of the FOMB, the Fuel Line Lenders shall

release any other party in interest that may be liable on account of the 

Fuel Line Loans.

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Exhibit B

Form of Joinder

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FORM OF JOINDER AGREEMENT

This Joinder Agreement (this “Joinder Agreement”) to the Plan Support and Settlement 

Agreement (as amended, supplemented or otherwise modified from time to time, the 

“Agreement”), dated as of December 1, 2022 by and among: (i) the Financial Oversight and 

Management Board for Puerto Rico (“FOMB”), as Title III representative of the Puerto Rico 

Electric Power Authority (“PREPA”), and (ii) all of the holders of Fuel Line Loans, as identified 

on Annex A thereto and party thereto, as such holders may change from time to time in accordance 

with Section 5(e) thereof (collectively, the “Fuel Line Lenders”), is executed and delivered by 

[____________________________________________] (the “Joining Fuel Line Lender”) as of 

_________, 202_. Each capitalized term used herein but not defined herein shall have the meaning 

set forth in the Agreement. 

1. Agreement to be Bound. The Joining Fuel Line Lender hereby agrees to be 

bound by all of the terms of the Agreement, including that the Joining Fuel Line Lender shall 

assume all rights (including, without limitation, the right to the Consummation Costs, but not the 

right to the Professional Fee Reimbursement) and obligations (including, without limitation, the 

obligation to pay its pro rata share of fees and expenses due under the Fuel Line Facilities) of a

Fuel Line Lender under the Agreement. The Joining Fuel Line Lender shall hereafter be deemed 

to be a “Fuel Line Lender” and a Party for all purposes under the Agreement, including for the 

avoidance of doubt with respect to any Fuel Line Loans held by the Joining Fuel Line Lender as 

of the date of this Joinder Agreement.

2. Representations and Warranties. With respect to the aggregate principal 

amount of Fuel Line Loans held by the Joining Fuel Line Lender, including upon consummation 

of Transfer of Fuel Line Loans to the Joining Fuel Line Lender, the Joining Fuel Line Lender 

hereby makes, as of the date hereof, the representations and warranties of the Fuel Line Lenders

set forth in Sections 6.01 and 6.02 of the Agreement to each of the other Parties to the Agreement.

3. Governing Law. Section 10.05 of the Agreement is incorporated by 

reference as if set forth fully herein, except that any references to “Agreement” shall be replaced 

with references to Joinder Agreement. 

* * * * *

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[Signature Page to Joinder to Preliminary RSA]

IN WITNESS WHEREOF, the Joining Fuel Line Lender has caused this Joinder 

Agreement to be executed as of the date set forth above. 

[NAME OF INSTITUTION]

By: 

Name: 

Title: 

Address:

Attention:

Email: 

Principal amount of Fuel Line Loans beneficially owned by the Joining Fuel Line Lender, or 

beneficially owned by accounts for which the Joining Fuel Line Lender has investment 

management responsibility, which it would be entitled to vote on in a plan solicitation: 

$___________ (total)

 $___________ (Citi Line)

 $___________ (Scotia Line)

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Annex A

List of Fuel Line Lenders

[REDACTED]

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