Capital Restructuring Overview 13 th of April 2017
DISCLAIMER This presentation has been prepared by Frigoglass S.A.I.C. (the Company ) for informational purposes only. Neither the Company, its affiliates nor their respective directors, officers, employees or agents (the Company Group ) gives any representation or warranty, express or implied, as to the achievement or reasonableness of future projections, management targets, estimates, prospects, returns, business data or property described in this presentation, if any. This presentation does not constitute an offer, invitation or solicitation by any member of the Company Group to subscribe for or purchase or sell any securities or assets in the United States or in any other jurisdiction, nor any form of commitment or recommendation by any member of the Company Group. This presentation may contain forward-looking statements which are based on current expectations and assumptions about future events. All statements other than statements of historical fact included in this presentation, including, without limitation, statements regarding Frigoglass capital structure review, the implementation of its proposed capital restructuring, future financial position, capital expenditures, projected sales, costs and costs savings, if any, may be forward-looking statements. These forward-looking statements are subject, among other things, to business, economic and competitive uncertainties and contingencies, which relate to factors that are beyond Frigoglass ability to control or estimate precisely and that could cause actual results to differ materially from those expressed therein. In view of the above, you are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this document. Frigoglass does not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this announcement. With respect to the announced capital restructuring, there can be no assurance that this will be implemented as currently anticipated, or at all, and the anticipated reduction in Frigoglass indebtedness and improvement in its liquidity set out in this presentation may not be realised. For a more detailed description of the main risks and uncertainties that could cause actual results to differ materially from those expressed or implied by forward-looking statements, please refer to Main Risks and Uncertainties in the Board of Directors Report contained in the Company s annual and half year financial statements which can be found on the company s website at www.frigoglass.com. In view of the above, you are cautioned not to place undue reliance on these forward-looking statements. The Company Group does not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of these materials. The Company reserves the right to change such information without warning. No representation or warranty of any kind is made with respect to the accuracy or completeness of the financial projections or other forward-looking statements, any assumptions underlying them, the Company Group s future operations or the amount of any future income or loss. 2
Overview Frigoglass has reached an agreement with key stakeholders to put in place a long-term sustainable capital structure and source additional funding for its business allowing to retain its market leading position in the currently challenging market environment The transaction is the result of extensive consensual negotiations between the Company, its major shareholder, Boval S.A. ( Boval ), an ad hoc committee (the Ad Hoc Committee ) representing certain holders of the 8.25% senior notes due 2018 (the Existing Notes ) issued by Frigoglass Finance B.V., and Citibank, HSBC, Alpha Bank and Eurobank (collectively the Core Banks ) The transaction has support from Boval, the Ad Hoc Committee and 100% of the Core Banks through a lock-up agreement (1) Implementation of the transaction is expected to take around 3 to 4 months, including: Consent solicitation process to amend bond indenture and facilitate a UK Scheme of Arrangement (the Scheme ) Scheme to implement Existing Notes restructuring and contractual arrangements to implement restructuring of Core Banks facilities Rights issue to provide existing shareholders the opportunity to participate in the restructuring (the Rights Issue ) (2) Partial equitisation of Existing Notes and Core Banks facilities (mechanics pending to be defined and agreed upon) The transactions are inter-conditional and remain subject to customary conditions precedent and conditions subsequent including but not limited to: Approval of requisite majorities of Existing Notes Approvals of relevant UK court in relation to the Scheme Approval of the General Meeting of the Company and Greek authorities for the issuance of shares (1) Lock-up agreement contains standard voluntary and automatic termination provisions (including material adverse effect on the Group, completion of milestones etc.). Under the lock-up agreement the members of the Ad Hoc Committee have agreed to support the Restructuring with all Existing Notes held on the relevant dates (c. 39% as of the date hereof) and have agreed to lock-up Existing Notes held by them on 20 March 2017 (c. 32% of all Existing Notes) (2) A reverse share split and a share capital decrease may also be submitted for approval of the General Meeting 3
Key Transaction Elements Up to 142m gross debt deleveraging (1) Through the equitisation of 100% of the 30m term loan provided by Boval (the Boval Loan ) and the equitisation or repayment of up to 42% ( 105m) of the 250m outstanding principal amount of Existing Notes and up to 13% ( 11m) of the 82m bank debt provided by the Core Banks (the Existing Facilities ) (2) The agreement contemplates a discount (3) of 45m being applied on a pro rata basis to the Existing Notes and Existing Facilities to be equitised or repaid (1) 70m additional liquidity 30m equity contribution to be made in cash by Boval in Rights Issue 40m new debt to be provided by Core Banks and Noteholders who elect to participate in the First Lien New Money offer pursuant to the Scheme ( Funding Noteholders ) Proceeds to fund working capital, general corporate purposes and pay restructuring expenses and fees Significantly reduced interest cost Annual interest expense to reduce to around 13m (4) Extension of maturity profile by around 5 years Significant support from main shareholder Boval 60m equity contribution, 30m in new cash and 30m through equitisation of the Boval Loan Boval to retain equity stake in line with current stake (1) Before the 40m First Lien New Money. First Lien New Money, First Lien, Second Lien and Company s shares ( Parent Shares ) split between bank facilities and new notes dependent on participation of existing Noteholders in the First Lien New Money (see Allocation Overview page for more details). Shown figures reflect assumed participation of c. 32% of the Existing Notes, i.e. the lockedup Existing Notes of the Ad Hoc Committee who have committed to fund. In case of 100% Noteholder participation, gross debt deleveraging would be 136m, of which 95m Existing Notes and 11m Core Banks. (2) Depending on the participation of Noteholders in the First Lien New Money and of existing shareholders in the Rights Issue, repayment to be made from the Rights Issue proceeds (other than Boval s cash contribution) (3) Implementation details to be agreed among the parties to the Lock-Up Agreement (4) Excl. any interest on the new 40m first lien senior secured debt to be received as part of the restructuring (the First Lien New Money ), which will amount to 2m annually assuming fully drawn 4
Transaction Elements - Deleveraging Pre- Transaction (1) Post Transaction (2) Reinstated Equitised Deleveraging (4) Existing Notes 250m 145m 105m m 382 142 Core Banks 82m (5) 74m 7m 30 30 105 Boval Loan Other Bank 30m 21m - 21m 30m - 250 7 240 Total 382m 240m 142m 145 First Lien New Money Total Incl. First Lien New Money New Money / 40m (3) 382m 280m (3) 142m 82 (5) 21 21 PF 2016 Q4 Deleveraging Pro Forma "Other" Bank Core Banks Existing Notes Boval Loan 74 (1) Pro Forma Q4 2016 (2) First Lien New Money, First Lien, Second Lien and Parent Shares split between bank facilities and new notes dependent on participation of existing Noteholders in the First Lien New Money (see Allocation Overview page for more details). Shown figures reflect assumed participation of c. 32% of the Existing Notes, i.e. the locked-up Existing Notes of the Ad Hoc Committee who have committed to fund. In case of 100% Noteholder participation, 155m of Existing Notes and 71m of Core Banks existing facilities would be reinstated and 136m would be equitised, of which 95m Existing Notes and 11m Core Banks (3) Includes any undrawn portion of First Lien New Money (4) Excludes First Lien New Monet (5) Reflects repayment of 2.9m of debt 5
Key Elements Improved Liquidity Amount Providers Form Additional Liquidity Post-Transaction m New Equity 30m Boval Equity 40 70 First Lien New Money 40m Core Banks Funding Noteholders Partially First Lien New Money Notes Partially First Lien New Money RCF or Term Loan 30 Total 70m New Equity First Lien New Money Total New Liquidity 6
Key Elements Maturities (1) Pre-Transaction Post-Transaction m m 250 139 132 21 250 80 82 139 30 21 21 80 2017 2018 2019 2020 2021 2022 Boval Loan HoldCo & OpCo Core Banks OpCo "Other" Existing Notes 2017 2018 2019 2020 2021 2022 1st Lien (2) 2nd Lien (3) OpCo "Other" (1) Excludes First Lien New Money (2) Including First Lien Notes and First Lien Facilities (3) Including Second Lien Notes and Second Lien Facilities. First Lien New Money, First Lien, Second Lien and Parent Shares split between bank facilities and new notes dependent on participation of existing Noteholders in the First Lien New Money (see Allocation Overview page for more details). Shown figures reflect assumed participation of c. 32% of the Existing Notes, i.e. the locked-up Existing Notes of the Ad Hoc Committee who have committed to fund. In case of 100% Noteholder participation, reinstated 2 nd Lien would be 146m 7
Key Elements Reduced Cost of Interest Pre-Transaction Interest Post-Transaction Interest Post-Transaction (2) Existing Notes 8.25% 1 st Lien E/L + 4.25% 2 nd Lien 7.00% m 29 16 2 2 Core Banks 6.32% (1) 1st Lien E/L + 4.25% 2 nd Lien E/L + 3.25% 21 12 Boval Loan 6.75% / 2 13 Other Bank First Lien New Money 4.19% (1) 4.19% (1) / E/L + 4.25% 9 5 3 1 1 Pre-Transaction Interest Reduction Post-Transaction "Other" Bank Core Banks Existing Notes Boval Loan (1) Weighted average rate (2) Excluding any interest on the First Lien New Money, which will amount to 2m annually assuming fully drawn; Depends on the participation of existing Noteholders in the New Money First Lien 8
Illustrative Shareholding Pre-Transaction Post-Transaction 100% Take-up of Rights Boval 44% Free Float 56% Boval 44% Free Float 56% 6-month average market cap: 6m (1) 141m Equity ( 6m existing plus 135m rights issue consisting of 60m Boval plus 75m other shareholders) No Take-up of Rights (2) Core Banks 3% Free Float 3% Boval 47% Noteholders 47% 133m Equity ( 6m existing plus 60m Boval plus 67m equitised debt after discount) (1) Existing market cap is calculated on the basis of 6-month average share price as of 16 March 2017 of 0.121 (2) First Lien New Money split between bank facilities and new notes dependent on participation of existing Noteholders in the First Lien New Money (see Allocation Overview page for more details). Shown figures reflect assumed participation of c. 32% of the Existing Notes, i.e. the locked-up Existing Notes of the Ad Hoc Committee who have committed to fund. In case of 100% Noteholder participation, Boval shareholding: 49%; Noteholders shareholding: 43%; Core Banks shareholding: 5%; Free Float: 3% 9
Contacts For further information on Frigoglass, please visit our website at www.frigoglass.com or contact: John Stamatakos Investor Relations Manager jstamatakos@frigoglass.com +30 210 61 65 767 10
New Instrument Terms 11
Allocation Overview Existing Notes and Core Banks Existing Facilities will be reinstated in the form of either First Lien (pari passu with First Lien New Money ) or Second Lien Total of 120m First Lien (New Money and reinstated) Total of 139m of Second Lien (1) The allocation of the First Lien New Money, the First Lien and Second Lien reinstated debt and equity among the Noteholders and Core Banks will depend upon the participation of the Noteholders in the First Lien New Money offer in the Scheme All Noteholders will have an option in the Scheme to participate in the First Lien New Money pro-rata to their holdings of Existing Notes to the aggregate of Existing Notes and Core Banks Existing Facilities (i.e. 331.5m) Core Banks and the Ad Hoc Committee have underwritten to fund 40m New Money pro-rata to their existing debt holdings as of December 31, 2016 (adjusted for further repayments) (50.3%/49.7%) (2) To the extent any Noteholder does not elect to fund its pro-rata share, such share will be funded by the Core Banks and Ad Hoc Committee pro-rata Funding Noteholders For each 1,000 of First Lien New Money funded by a Noteholder, that Noteholder will be entitled to exchange 2,000 of principal amount of Existing Notes for 2,000 of First Lien reinstated notes ( Notes Roll-Up ) Remaining Existing Notes (after giving effect to Notes Roll-Up, if any) to be exchanged for 50% in Second Lien Notes and for 50% in Parent Shares (3) Non-Funding Noteholders Existing Notes claim will be exchanged 50% into Second Lien Notes and 50% into Parent Shares (3) Core Banks are treated similar to Funding Noteholders but their remaining debt claim is reinstated at 82.5% rather than 50% into Second Lien (with such Second Lien bearing reduced interest at 3.25% vs 7% of Second Lien Notes as a compensation for the higher reinstated level) (1) First Lien New Money split between bank facilities and new notes dependent on participation of existing Noteholders in the First Lien New Money. Shown figures reflect assumed participation of c. 32% of the Existing Notes, i.e. the locked-up Existing Notes of the Ad Hoc Committee who have committed to fund. In case of 100% Noteholder participation, the Second Lien amount would be 146m (2) Core Banks and members of the Ad Hoc Committee will receive 100 bps underwriting fee. Ad Hoc Committee s underwriting commitment is proportional to Existing Notes held as of December 31, 2016, c. 32% (3) The partial equitisation of Existing Notes and Existing Facilities will take effect after giving effect to a discount that will amount to an aggregate of 45m to be allocated pro rata to the amount of debt of Existing Notes and Core Banks Existing Facilities being equitised. Mechanics to implement the discount are to be agreed. To the extent that existing shareholders (other than Boval) take part in the Rights Issue, proceeds will be used to repay Existing Notes and Existing Facilities to be equitised reducing the amount of new Parent Shares subscribed by Noteholders and Core Banks, and to stay on the Company s balance sheet thereafter 12
First Lien Terms First Lien Facilities First Lien Notes (1) Providers Core Banks Funding Noteholders Amount Borrower/Issuer Maturity Interest Ranking Guarantors/ Security Financial Covenants 60.4m (2) (of which 20.1m new money) Senior secured obligations, pari passu among each other December 2021 E/L + 4.25% (Euribor/Libor floor of 0) 59.6m (2) (of which 19.9m new money) First ranking security. Comprehensive guarantee and security package including, but not limited to, fixed asset, bank account, trade receivable, intercompany receivable, real estate and share security subject to certain carve-outs for legal, cost benefit or local lender restrictions Guarantors should represent a minimum of 85% of Group s EBITDA and 75% of the Group s assets Minimum liquidity test: 20m on the last day of each week during 6 months prior to calculation date and projection of at least 20m on the last day of each week for the following 6 months Net / LTM EBITDA covenant, tested every 6 months: not to exceed 8.4x on December 31, 2017 and June 30, 2018, 6.0x on December 31, 2018, 6.3x on June 30, 2019, 5.1x on December 31, 2019, 5.6x on June 30, 2020, 4.7x on December 31, 2020 and 5.2x on June 30, 2021 Annual one-week clean down in November of each year starting in 2018 (and maintenance during such week of Minimum Cash Threshold of 40 million, less the amount of the First Lien New Money RCF) Equity cure: financial covenants capable of cure by means of cash injections (equity or subordinated shareholder debt) at any time (up to and including 20 business days after the latest date on which a compliance certificate has been delivered), subject to a maximum of 3 cures. Equity cure cannot be made in consecutive testing periods Frigoglass Finance B.V. Cross default on maintenance covenants and clean down of First Lien Facilities subject to intercreditor principles and include grace period of 20 business days (1) Form of Instrument: privately placed note. Company to make reasonable efforts to have notes issued in the Restructuring reviewed by rating agencies (2) Shown figures reflect no participation of any Existing Notes other than the locked-up Existing Notes of the Ad Hoc Committee in the First Lien New Money. In case of 100% Noteholder participation, First Lien New Money split would be 9.8MM by Core Banks and 30.2 MM by Funding Noteholders 13
First Lien Terms (Cont d) First Lien Facilities First Lien Notes (1) Use of Proceeds Other Key Terms (2) Support liquidity of the business and fund restructuring fees and expenses 2m amortisation to be paid every 6 months from March 2019; amortisation payment can be deferred for 6 months but if deferred next amortisation payment cannot be deferred (and drawstop on RCF utilisations until paid) Mandatory prepayment under certain circumstances, including change of control and disposals of assets. Other customary LMA-based covenants Most favoured nation for First Lien Notes and First Lien Facilities Capacity for further debt: Up to 9m first lien debt (if First Lien RCF less than 45m), of which 1.5m only for hedging; if First Lien RCF equal or higher than 45m, up to 7.5m first lien debt Up to 7.5m second lien Other working capital facilities at local subsidiaries: up to 30 million in Russia (e.g. Sberbank), up to 3.5m in India (e.g. Yes Bank) and up to 18m in Nigeria (e.g. Stanbic), of which 10m letters of credit only, and any refinancing thereof Additional financial indebtedness based on business needs if agreed with Core Banks and Ad Hoc Committee Amendments and waivers: First Lien Facilities subject to general 90% supermajority and requiring unanimous consent in certain circumstances First Lien Notes in line with Existing Notes but failure to reply in 14 calendar days will exclude holders notes from calculation First Lien Notes redeemable at par (no call protection) with minimum redemption amount ( 1m) First Lien Notes indenture will contain a cross-default provision with First Lien Facilities Voluntary prepayments under First Lien Facilities permitted with 5 business days notice and in minimum amount of 1m (subject to Intercreditor Agreement) Payment - 4m Governing Law English Law (1) Form of Instrument: privately placed note. Company to make reasonable efforts to have notes issued in the Restructuring reviewed by rating agencies (2) Legal documentation will also include certain reporting and information obligations for the Company and an undertaking to hive down certain contracts to the Dutch subsidiaries 14
Reinstated Second Lien Second Lien Facilities (1) Second Lien Notes (2) Providers Core Banks Noteholders Amount 34.0m (3) 105.1m (3) Borrower/Issuer Maturity Frigoglass Finance B.V. March 2022 Interest Ranking E/L + 3.25% (0% floor) 2 nd ranking indebtedness, junior to First Lien 7.00% (Fixed) Guarantors/ Security Second ranking security. Comprehensive guarantee and security package including, but not limited to, fixed asset, bank account, trade receivable, intercompany receivable, real estate and share security subject to certain carve-outs for legal, cost benefit or local lender restrictions Covenants Per First Lien Facilities but event of default for financial covenants or clean down subject to 20 business days grace period No financial covenants In line with Existing Notes with additional restrictions baskets as per First Lien Facilities subject to any senior headroom to be agreed Other Key Terms All amendments and waivers under the Second Lien Facilities will require unanimous consent Second Lien Notes redeemable at par (no call protection) with minimum redemption amount ( 1m) Governing Law English Law New York Law (1) Term and revolving credit facilities. RCF not to exceed 12.8m (2) Form of instrument: listed high yield bond (3) First Lien New Money split between bank facilities and new notes dependent on participation of existing Noteholders in the First Lien New Money. Shown figures reflect assumed participation of c. 32% of the Existing Notes, i.e. the locked-up Existing Notes of the Ad Hoc Committee who have committed to fund. In case of 100% participation, reinstated Second Lien would be split into 51.0m from Core Banks and 94.8m from Noteholders 15
Transaction Parameters Intercreditor First Lien enforcement rights subject to bespoke additional second lien protection and period of standstill Enforcement outside insolvency requires consent from both holders of over 50% of First Lien credit participations and holders of over 50% of First Lien Notes or, following notice and expiry of a 60 day consultation period, either holders of over 50% of First Lien credit participations or holders of over 50% of the First Lien Notes Prepayments to be applied pro rata between Notes and Banks in order of priority Payment restrictions, customary turnover, distressed disposal, and loss sharing provisions Enforcement of share security over shares in Frigoglass Industries Nigeria Limited, Beta Glass plc or Frigoinvest Holdings B.V. must be undertaken through a competitive sales process if certain conditions are met Governance Arrangements acceptable to creditors in relation to governance Accrued Interest to Closing No further cash payments until closing; interest to accrue post March 15, 2017 as if transaction had taken place on March 15, 2017; all interest accrued to be paid in cash at closing Fees Dual Listing 100bps underwriting fee on the uncommitted First Lien New Money 60bps total consent fee on outstanding amount of existing debt will be payable on closing of the Restructuring to creditors who consent within applicable time periods Post-closing dual listing of Parent Shares to be analysed 16