Tiscali 2014 Annual Report Download - page 105

Annual financial report as at 31 December 2014
Date
File Name
Status
Page
-
Annual Report as at 31
December 2014
105
Restructuring Agreements
On 23 December 2014, Tiscali UK, in the capacity of borrower, entered into - together with the
Company and its subsidiaries Tiscali Italia S.p.A., Tiscali International B.V., Tiscali Financial Services
S.A. and Veesible S.r.l., in the capacity of guarantors (the “Guarantors”), with the Senior Financiers -
the Restructuring Agreements, aimed at the restructuring of the senior debt of the Tiscali Group
deriving from the Group Facilities Agreement entered into on 2 July 2009.
The Restructuring Agreements envisage that the debt subject to restructuring, amounting to around
EUR 140 million, as of the date of entering into the restructuring, is divided up into the following credit
facilities:
 Facility A1, vis-à-vis all the Funds, for an amount totalling around EUR 42.44 million, to be
repaid by 30 November 2015;
 Facility A2, likewise vis-à-vis all the Funds, for an amount totalling around EUR 42.44 million,
to be repaid in six-monthly instalments, the last of which falling due on 30 September 2017;
 Facility B, vis-à-vis Intesa, for an amount totalling around EUR 55.14 million, to be repaid in
six-monthly instalments, the last of which falling due on 30 September 2017.
It must also be disclosed that, as per the Restructuring Agreements, the liquidity deriving from the
Share Capital Increase transaction described in the section “Assessment of the business as a going-
concern and future outlook” will be used in full to repay Facility A1, without prejudice to the possibility
for the Company, assessing other forms of funding, to proceed with the repayment of any residual
portion of these credit facility by means of recourse to additional share capital increases and/or to
negotiate with the Senior Financiers the possible conversion into equity, upon the initiative of the
Company and subordinate to the occurrence of certain specific conditions.
Interest
In accordance with the Restructuring Agreements, Tiscali UK shall have to pay interest to the Senior
Financiers at a fixed rate as per the matters indicated below:
 in relation to Facility A1: (i) 6.5% per annum for 2014; (ii) 7.5% per annum for 2015;
 in relation to Facility A2: (i) 6.5% per annum for 2014; (ii) 7.5% per annum for 2015; (iii) 9%
per annum for 2016; (iv) 10% per annum for 2017;
 in relation to Facility B: (i) 6.5% per annum for 2014; (ii) 7.5% per annum for 2015; (iii) 9% per
annum for 2016; (iv) 10% per annum for 2017;
The first interest period will mature on 31 March 2015, after which each interest period shall have a
six-month duration.
Financial covenants
As is common practice in this type of agreement, the Restructuring Agreements envisage the
observance by the companies party to the same of financial requisites (“financial covenants”) on a
consolidated basis, defined on the basis of the Tiscali Business Plan and related to the Debt Service
Cover Ratio (as defined in the Restructuring Agreements), the net indebtedness/EBITDA and the
EBITDA/net interest ratios.
The following table shows the levels of said financial covenants envisaged by the Restructuring
Agreements with reference to 31 December 2015 and 31 December 2016.