Electronics Production | August 19, 2009

Thomson signs restructuring agreement with majority of Senior Creditors

French consumer electronics company Thomson SA has signed a restructuring agreement withh a majority of it’s senior creditors. On 15 June 2009 Thomson entered into a waiver and forbearance agreement in respect of the 6.05% Senior Notes, Series A due 2009.
Pursuant to the Waiver Agreement it was agreed between Thomson and a sufficient number of holders to bind all holders of the 6.05% Series A Notes (being all such holders), and in a form that bound all holders of the 6.05% Series A Notes, that the date for the payment of principal in an amount equal to USD 72,500,000 under the 6.05% Series A Notes be deferred from 17 June 2009 until 25 July 2009; and the 6.05% Series A Notes were held at such time by more than three holders that were not affiliates of each other.

• Key Features of the Restructuring Agreement
— Reduction of current gross senior debt of €2,839 million by 45%, or €1,289 million, to a sustainable reinstated gross senior debt amount of €1,550 million

— Conversion of €1,289 million of existing senior debt into: (a) newly issued shares for an equivalent of €350 million through a rights issue; (b) notes redeemable in shares (Obligations Remboursables en actions, “ORA”) for an equivalent of €639 million; and (c) Disposal Proceeds Notes (“DPN”) for an equivalent of up to €300 million

— Thomson existing shareholders to be offered to participate in the capital restructuring through: (a) ability to subscribe to the €350 million rights issue, fully backstopped by creditors; and (b) opportunity to subscribe to ORAs for an amount of €75 million (out of the total €639 million) on the same terms as creditors

— Thomson’s existing shareholders able to retain up to 52%, but no less than 15% of the Company’s share capital depending on the rights issue take-up and ORA subscription

— Company liquidity needs addressed through ability to keep €400 million of cash on balance sheet at closing, adjusted for seasonality, and flexibility to put in place new receivables-backed working capital facilities of up to €150 million


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