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Speedcast files plan of reorganisation and disclosure statement outlining clear path to emergence from Chapter 11

Speedcast Files Plan of Reorganization and Disclosure Statement Outlining Clear Path to Emergence from Chapter 11

Terms include a $500 Million equity investment and a reduction in secured debt of $634 million

Speedcast International Limited (ASX:SDA) today announced that it has filed a Plan of Reorganization and Disclosure Statement outlining the terms for its financial restructuring under chapter 11 of the United States Bankruptcy Code. The documents set out a clear and defined timeline for creditors to submit their votes in advance of a Plan confirmation hearing anticipated in December 2020. The Company expects to emerge in the first quarter of 2021, after receiving final regulatory approvals and customary closing conditions outlined in the Plan.

Upon emergence, the terms of the Plan would provide Speedcast with a new $500 million equity investment, led by affiliates of Centerbridge Partners, L.P., and a reduction of all of the $634 million senior secured debt of the Company. The Plan has received the unanimous support of Speedcast’s Board of Directors and has the support of the Official Committee of Unsecured Creditors, which has issued a letter recommending that all unsecured creditors vote to accept the Plan.

The Company and its Board of Directors are confident the current Plan represents the best opportunity to position Speedcast for long-term success, while maximizing value for its creditors and other stakeholders. As part of the Plan process, the Company and its creditors can also consider any higher and better Plan proposed prior to the Plan confirmation hearing.

The Plan provides for a cash payment to holders of secured claims. A number of the company’s trade vendors are crucial to its future, and the Plan provides these crucial trade vendors with a partial cash payment on account of their unsecured claims.

Unsecured creditors generally will share in recoveries from a litigation trust. As previously indicated, the Plan does not contemplate any recovery for existing shareholders, and existing shareholders would no longer have an equity interest in the reorganized Speedcast Group following its emergence from chapter 11.

Speedcast first announced its decision to recapitalize its business through voluntary Chapter 11 proceedings on April 23, 2020.

Speedcast is advised by Weil, Gotshal & Manges LLP as global legal counsel and Herbert Smith Freehills as co-counsel. Michael Healy of FTI Consulting, Inc. is Speedcast’s Chief Restructuring Officer, and FTI Consulting, Inc. is Speedcast’s financial and operational advisor. Moelis Australia Advisory Pty Ltd and Moelis & Company LLC are Speedcast’s investment bankers. KCC is Speedcast’s claims and noticing agent. Centerbridge is advised by Wachtell, Lipton, Rosen & Katz.

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