Tiscali 2014 Annual Report Download - page 134

Annual financial report as at 31 December 2014
Date
File Name
Status
Page
-
Annual Report as at 31
December 2014
134
The negotiations with the Senior Financiers continued until presentation by the Company, in 2014, of a
preliminary and non-binding proposal concerning, amongst other aspects, a recapitalisation of the
Group, a partial rescheduling of the debt and a reset of the financial covenants envisaged by the GFA.
Subsequent to presentation of this proposal, which received the general consent of the Senior
Financiers, a multi-stage negotiation process was commenced, on the outcome of which the Tiscali
Group:
 on 17 December 2014, approved the business plan (“Business Plan”) and obtained, on 23
December 2014, the related asseveration carried out by a professional appointed as per
Article 67.3, letter d) of the Italian Bankruptcy Law;
 on 22 December 2014, accepted the offer made by a leading Italian real estate fund relating to
the transfer of the leasing agreement concerning the property Sa Illetta where the Group’s
headquarters are located (the “Leasing Agreement”), which may be finalised between the
parties on verification of specific conditions which must take place by 31 March 2015. The
agreements relating to this transaction envisage, among other aspects, that the Tiscali Group
continue to use the Sa Illetta property under market conditions; furthermore, if the disposal
transaction should not be completed by 15 April 2015, the leasing companies involved have
agreed to: (i) redefine the repayment plan; (ii) not avail themselves, until 30 April 2015, of any
of the remedies envisaged in accordance with the Leasing Agreement;
 on 23 December 2014, entered into - with the Senior Financiers - a financial debt restructuring
agreement pursuant to the GFA (Restructuring Agreements”), for the purpose of achieving,
amongst other things: (i) a partial rescheduling of the debt as per the GFA (which, as of that
date, amounted to around EUR 140 million); as well as (ii) a redefinition of the financial
covenants, for the purpose of bringing them in line with the Business Plan. Specifically, in
short the afore-mentioned agreements envisage:
o the division of the entire debt vis-à-vis the Senior Financiers, amounting to around
EUR 140 million as of the date of entering into the Restructuring Agreements, into
three separate credit facilities: (i) Facility A1, for an amount of around EUR 42.4
million, to be repaid by 30 November 2015, primarily by means of the use of the
proceeds of any share capital increases of the Company; (ii) Facility A2, for an
amount of around EUR 42.4 million, to be repaid in six-monthly instalments, the last of
which falling due on 30 September 2017; (iii) Facility B, for an amount of around EUR
55 million, to be repaid in six-monthly instalments, the last of which falling due on 30
September 2017;
o in the event of early repayment of Facility A1, the possibility of benefiting from a
discount of up to 10% on the face value of the debt repaid, in relation to the
repayment timescales;
o the possibility for the Company, assessing other forms of funding, to resort to
additional share capital increases and to negotiate with the financiers in accordance
with Facility A1 possible conversion into equity - upon the initiative of said Company
and subordinate to the occurrence of certain specific conditions - of the residual
portion of this credit facility;
o an interest rate of 6.5% for 2014, 7.5% for 2015, 9% for 2016 and 10% for 2017;
o financial covenants in line with the performances of the Tiscali Group envisaged in the
Business Plan.
 on 24 December 2014, established an agreement with Société Générale relating to the
subscription by the latter of a share capital increase against payment for a maximum of
1,000,000,000 ordinary Tiscali shares, lacking par value, with exclusion of the purchase option
pursuant to Article 2441.5 of the Italian Civil Code (“Share Capital Increase”). The agreement