Perpetual Energy Inc. announced that it has completed its previously announced arrangement involving the exchange of its 8.75% senior unsecured notes due January 23, 2022 (the "Old Notes") for new 8.75% secured third-lien notes due January 23, 2025 (the "New Notes") pursuant to a Court-approved plan of arrangement (the "Note Exchange Arrangement"). The New Notes have been issued under a new trust indenture that contains substantially the same terms as the Old Notes other than the New Notes are secured on a third-lien basis subordinate to the Company's senior indebtedness and allow for semi-annual interest payments to be paid either in cash, in additional New Notes (a "PIK Interest Payment"), or a combination thereof, at the Company's election. The Company has elected to make a PIK Interest Payment on the New Notes for the January 23, 2021 interest payment. Holders of New Notes will receive $43.75 per $1,000 principal amount of New Notes in a PIK Interest Payment, representing all accrued and unpaid interest outstanding from July 23, 2020 up to, but excluding, January 23, 2021, being the first interest payment of the New Notes, which, for greater certainty, such amount includes all accrued and unpaid interest on the Notes. The Note Exchange Arrangement is designed to strengthen the Company's overall financial position and maximize value for all stakeholders including noteholders and shareholders. In addition to providing the noteholders with security over the Company's assets, it is also anticipated to provide noteholders with greater certainty that the Company will continue to make regular semi-annual interest payments on the Notes and will be able to repay the New Notes when due. The Note Exchange Arrangement has not resulted in any dilution to the Company's shareholders as no shares were issued in connection with the Note Exchange Arrangement and shareholders continue to own the same number of shares, nor will the security granted under the New Notes negatively affect shareholders.