DocuSign Envelope ID: 5C44EE2E-7E3B-4D26-AA1D-EBC1FECBO83A
3 LATAM
Mrs,
ESSENTIAL FACT
LATAM AIRLINES GROUP S.A.
Registration of Securities Registry No. 306
Santiago, May 11, 2022
Solange Berstein Jáuregui
Chairman
Financial Market Commission
Av. Libertador Bernardo O’Higgins 1449
Santiago
Ref.: Communicates ESSENTIAL FACT
Dear Sir or Madam:
In accordance with the provisions of Article 9 and the second paragraph of Article 10% of the Securities Market Law, and General Rule No. 30, duly authorized, I hereby inform the following ESSENTIAL FACT of LATAM Airlines Group S.A. (“LATAM” or the “Company”), registration Securities Registry No. 306:
1. As a result of the mediation process currently underway in the context of the reorganization and financing plan (the “Reorganization Plan” or the “Plan”) proposed by LATAM and certain of its direct and indirect subsidiaries (together with LATAM, the “Debtors”) in their reorganization proceedings in the United States of America (the “Chapter 11 Proceeding”) before the Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”) under the rules set forth in Chapter 11 of Title 11 of the United States Code, (i) Debtors; (ii) the group of LATAM creditors represented by Evercore (the “Supporting Creditors”), Delta Air Lines, Inc, Qatar Airways Investment (UK) Ltd., the Cueto group (collectively, the “Supporting Shareholders”, and together with the Supporting Creditors, the “Supporting Parties”); (iii) the Eblen group; (iv) Banco del Estado de Chile (“Banco Estado”) as representatives of the holders of Chilean bonds issued by LATAM; (v) certain holders of such Chilean bonds (the “Chilean Bondholders”); and (vi) the Committee of Valista Creditors (the “UCC”) of the Chapter 11 Proceeding reached an agreement that resolves (y) objections to the Plan and challenges to orders issued by the Bankruptcy Court, filed by Banco Estado; and (Z) objections to the Plan and other bankruptcy actions, filed by the UCC.
This agreement further paves the way to the Plan’s confirmation hearing scheduled for May 17-18, and adds support to the Society’s Consensual Plan by further paving the way for a successful emergence. At the same time, it allows Chilean bondholders to increase their recovery under the Plan as well as provide financing commitments under the support agreements entered into between the Debtors and the Supporting Creditors (the “Creditor Support Agreement”) in support of the Reorganization Plan.
3. The main terms of this agreement are as follows:
to. The treatment accorded to Class 5 creditors of the Plan is modified. Under the original Plan, creditors of this class could choose to participate in the New Class A Convertible Bonds or the New Class C Convertible Bonds, depending on whether or not they chose to contribute new funds. Creditors who opted for the New Class A Convertible Bonds would receive these bonds in payment of
Link to file in CMFChile: https://www.cmfchile.cl/sitio/aplic/serdoc/ver_sgd.php?s567=50772418545298783dfe327b5ba701b2VFdwQmVVMXFRVEZOUkVVMFRrUkJOVTEzUFQwPQ==&secuencia=-1&t=1682376108
