Editoria e Media
Technicolor Creative Studios: Progressing towards delivering its recovery plan
CORPORATE PRESS RELEASE
Technicolor Creative Studios
Progressing towards delivering its recovery plan
PARIS (FRANCE) , April 3 , 202 3 – Technicolor Creative Studios (Euronext Paris: TCHCS) (the “ Company ”) announces today an update of the implementation of its refinancing.
Caroline Parot, Chief Executive Officer of Technicolor Creative Studios, said: “ Reaching an agreement on the refinancing of Technicolor Creative Studios has been pivotal in establishing the foundations of our long-term growth. I am delighted that the process is progressing well with the execution of a conciliation protocol in line with the established schedule. We are extremely grateful for the confidence and support of our key creditors and shareholders, as we strive to achieve Technicolor Creative Studios' full value potential. I would also like to thank all the teams for the great work they have done so far and are preparing to do throughout the year. Their talent, creativity, and dedication are the reasons why our Company is trusted by so many in the industry .”
A NEW CHAPTER FOR REBOUND WITH THE EXECUTION OF THE CONCILIATION PROTOCOL
Following the agreement in principle reached on March 8, 2023, Technicolor Creative Studios is pleased to announce (i) the execution on March 27, 2023 of a conciliation protocol (the “ Conciliation Protocol ”) by its lenders and shareholders showing their support in the rebound of the Company and (ii) its approval by a judgment of the Commercial Court of Paris dated March 29, 2023 which puts an end to the conciliation procedure opened on January 20, 2023.
In accordance with the terms of the agreement in principle dated March 8, 2023, the Conciliation Protocol provides that the refinancing will include (i) a new money financing in aggregate principal amount, net of original issue discount and underwriting fee, equal to c.€170 million and (ii) the reinstatement of the existing indebtedness (the “ Refinancing ”).
The implementation of the Refinancing pursuant to the terms of the Conciliation Protocol is detailed hereafter .
The implementation of the Refinancing will be subject to approval by the general meeting (expected to be held during the second quarter of 2023) and to the visa of the Autorité des Marchés Financiers under applicable regulation.
The impact of these transactions on the Company's share capital is described in Appendix I.
The Conciliation Protocol provides that the governance of the Company will be set up as follow:
The implementation of the Restructuring will be subject to certain conditions precedent which include the following key points
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WARNING / FORWARD LOOKING STATEMENTS
This press release contains certain statements that constitute "forward-looking statements", including but not limited to statements that are predictions of or indicate future events, trends, plans or objectives, based on certain assumptions or which do not directly relate to historical or current facts. Such forward-looking statements are based on management's current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from the future results expressed, forecasted, or implied by such forward-looking statements.
Investors' attention is drawn to the risk factors relating to Technicolor Creative Studios described in Chapter 3 of the prospectus prepare in connection with the admission of TCS shares to trading on the regulated market of Euronext, approved by the AMF on August 1, 2022 under number 22-331,which is available free of charge and upon request at the company's registered office, 8-10 rue du Renard, 75004 Paris, France, or on the websites of the AMF ( https://www.amf-france.org ), and Technicolor Creative Studios ( https://www.technicolorcreative.com/investors/ .
This press release does not contain or constitute an offer of securities for sale or an invitation to invest in securities in France, the United States or any other jurisdiction.
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ABOUT TECHNICOLOR CREATIVE STUDIOS
Technicolor Creative Studios shares are admitted to trading on the regulated market of Euronext Paris (TCHCS)
Technicolor Creative Studios is a creative technology company providing world-class production expertise driven by one purpose: The realization of ambitious and extraordinary ideas. Home to a network of award-winning studios, MPC, The Mill, Mikros Animation and Technicolor Games, we inspire creative companies across the world to produce their most iconic work.
Our global teams of artists and technologists partner with the creative community across film, television, animation, gaming, brand experience and advertising to bring the universal art of storytelling to audiences everywhere.
www.technicolorcreative.com
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Investor Relations Contact:
investor.relations@technicolor.com
Corporate press:
Image 7: Technicolorcreative@image7.fr
APPENDIX I – ILLUSTRATIVE PRO-FORMA EQUITY OWNERSHIP
The transactions would have the following impacts on the share capital:
Appendix II – Indicative Terms & Conditions of instruments and reinstated debt under the Conciliation Protocol
The amounts set out below are net of Initial Issue Discount and underwriting fees.
These €30 million bonds notes have the following features: 31 July 2023 maturity, cash coupon interest of 0.75%, redemption (including early redemption and redemption at maturity) premium of €1,25 million in case of absence of refinancing through the Convertible Notes, super senior ranking (on a pari passu basis with the first tranche super senior credit facility and the reinstated super senior RCF) from date of the drawdown early April.
The first tranche super senior credit facility and the second tranche of super senior credit facility are together being referred to as the “New Money Credit Facility”.
The strike of those warrants is expected to be 0.01€ per TCS share after a share capital reduction by way of reduction of the nominal value of each TCS share which will be proposed to the general meeting as part of the operations.
Such conversion may occur on a voluntary basis at any time or on a mandatory basis, with mandatory conversion
occurring if the enterprise value of the Company exceeds €1.2 billion or the EBITDAal exceeds €150,000,000, in
each case, based on valuation methodology and mechanics to be agreed.
The “PF Fully Diluted Share Capital”.
Upon completion of the debt to equity, the First Lien Facility lenders will hold 65.67% of the Company's share capital (44%of the PF Fully Diluted Share Capital) as set forth in Appendix I.
The Company has been informed that the valuation work requested by the President of the Commercial Court as part of the conciliation proceedings from Ledouble, acting as independent valuator, concluded that the enterprise value of the Company is set between € 510 and 600 million.
Excluding the Equity First Tranche Refinancing.
Non-Call 2 means that during the first two years after the first drawdown, in case of early redemption, TCS would have to pay an indemnity equal to the total amount of interest which would have accrued on the amount which is prepaid from the early redemption date until the expiry date of the two-year period following the First Drawdown.
« 103 for the following 12 months » means that in case of early redemption in the course of the third year, TCS would have to pay an indemnity equal to 3% of the relevant amount being prepaid.
As from the second drawdown of the New Money Credit Facility and the issue of the Convertible Notes.
As from the second drawdown of the New Money Credit Facility and the issue of the Convertible Notes.
As from the second drawdown of the New Money Credit Facility and the issue of the Convertible Notes.
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