Primary Energy Recycling Corporation Announces Update on Refinancing

    OAK BROOK, IL, June 22 /CNW/ - Primary Energy Recycling Corporation (TSX:
PRI.UN) (the "Company") is pleased to announce today that the Company has
signed a term sheet with anchor lenders to refinance its US$135 million term
loan facility (the "Credit Facility"). The term sheet provides for a new
senior secured term loan facility with a principal amount sufficient to repay
the Credit Facility (the "Proposed Facility"). The Proposed Facility would
require quarterly scheduled amortization payments, a quarterly cash sweep of
excess cash flow and mandatory prepayments of net cash proceeds from asset
sales that would be expected to result in the substantial de-leveraging of the
Company over the term of the Proposed Facility. The Proposed Facility would be
guaranteed by all of the Company's subsidiaries and secured by a pledge of
substantially all of the Company's and its subsidiaries' assets. The anchor
lenders, which includes the Company's financial advisor, Credit Suisse
Securities (USA) LLC, or their respective affiliates, are expected to be
co-lead arrangers of the Proposed Facility. The Company intends to work
diligently towards obtaining financing commitments from the anchor lenders and
additional lenders and negotiating definitive loan documentation for the
Proposed Facility over the coming weeks; however, there can be no assurance
that the Company will be able to secure such commitments on the terms
described in this press release or at all.
    A critical condition required to refinance the Credit Facility is the
successful completion of the previously announced conversion of all of the
Company's outstanding 11.75% subordinated notes into newly issued common
shares of the Company (the "Recapitalization"). Holders of the Company's
subordinated notes and common shares will be asked to approve the
Recapitalization at a meeting of the Company's securityholders expected to be
held in late July. The Recapitalization will also be subject to approval by
the Supreme Court of British Columbia. Further details of the Recapitalization
will be provided in an information circular expected to be distributed to the
Company's shareholders and noteholders in late June or early July.
    The Credit Facility expires on August 24, 2009. Failure to approve the
proposed Recapitalization and refinance or extend the Credit Facility on or
prior to maturity will cause the Company to be in default of the Credit

    Forward-Looking Statements

    Certain statements in this press release are "forward looking
statements", which reflect the expectations of management regarding
refinancing of the Credit Facility, the Recapitalization, future growth,
results of operations, performance and business prospects and opportunities of
the Company. Such forward looking statements reflect current expectations
regarding future events and operating performance and speak only as of the
date of this press release. 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. A number of factors could cause actual results to differ materially
from the results discussed in the forward looking statements. Although the
forward looking statements contained in this press 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. Some of the risks, uncertainties and other
factors include the Company's ability to secure commitments to refinance the
Credit Facility on acceptable terms or at all, the successful completion of
the Recapitalization and refinancing of the Credit Facility and the factors
discussed in the Company's public filings available on SEDAR at
These forward-looking statements are made as of the date of this press release
and, except as required by applicable securities laws, the Company assumes no
obligation to update or revise them to reflect new events or circumstances.

    About Primary Energy Recycling Corporation

    The Company owns a majority interest in Primary Energy. Primary Energy,
headquartered in Oak Brook, Illinois, indirectly owns and operates four
recycled energy projects and a 50 per cent interest in a pulverized coal
facility (collectively, the "Projects"). The Projects have a combined
electrical generating capacity of 283 megawatts and a combined steam
generating capacity of 1.8 MMlbs/hour. Primary Energy creates value for its
customers by capturing and recycling waste energy from industrial and electric
generation processes and converting it into reliable and economical
electricity and thermal energy for its customers' use. For more information,
please see

For further information:

For further information: V. Michael Alverson, Chief Financial Officer,
Primary Energy Recycling Corporation, (630) 371-0639,

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Primary Energy Recycling Corporation

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