DocuSign Envelope ID: 648FE90F-06E8-4B13-8274-750547E24386
3 LATAM
ESSENTIAL FACT
LATAM AIRLINES GROUP S.A.
Registration of Securities Registry No. 306
Santiago, October 26, 2022
Mrs.
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 report the following ESSENTIAL FACT of LATAM Airlines Group S.A. (“LATAM” or the “Company”), registration Securities Registry No. 306:
1. As previously reported, the Company intends that the effective date (the “Effective Date”) of its reorganization and financing plan (the “Reorganization Plan”) that has been approved and confirmed in its reorganization proceeding in the United States of America (the “Chapter 11 Proceeding”) under the rules set forth in Chapter 11 of Title 11 of the United States Code, occurs on November 3, 2022. Accordingly, on the Effective Date the Company, together with its various subsidiaries that are party to the Chapter 11 Proceeding, will emerge from it.
2. In relation to the above:
to. The Company contemplates that (i) the 73,809,875,794 new payment shares, registered in the Securities Registry of the Commission for the Financial Market (“CMF”); (ii) the portion of the 1,257,002,540 bonds convertible into Series G shares that have been subscribed, (iii) the 1,372,839,695 bonds convertible into Series H shares; (iv) the 6,863,427,289 bonds convertible into Series I shares, all registered in the Securities Registry of the CMF (collectively, the bonds referred to in subparagraphs (ii), (iii) and (iv) foregoing, the “Convertible Bonds”); and (v) the portion of the 3,818,042 new corporate bonds not convertible into Series F shares that have been subscribed, also registered in the Securities Registry of the CMF, are delivered to their respective subscribers on the Effective Date.
b. The conversion periods of the Convertible Bonds will take effect from the Effective Date, under the terms and conditions contemplated in the respective issuance agreements. It is recalled that holders of Convertible Bonds who wish to exercise their conversion option must do so in accordance with the procedure established for this purpose in the respective issuance contract, by written communication addressed to LATAM, to the email address [email protected] with the subject “Convertible Bond Conversion Request”, according to the format attached as Annex Three to the issuance contract. For convenience, a copy of this format is available in https://www.latamairlinesgroup.net/es/news-releases/news-release-details/informacion-sobre-proceso-de-conversion-de-bonos-convertibles.
As reported in an essential event dated May 11, 2022, valista creditors who have elected to receive Series G convertible notes and Series I convertible notes will be entitled to receive a one-time additional cash payment (the “Additional Cash Distribution”) determined based on the difference between the Company’s EBITDAR contemplated in its original business plan and the Company’s actual EBITDAR between on January 1, 2022 and whichever date is 15 days before the departure of Chapter 11 Procedure. Such Additional Cash Distribution will be paid as of the Effective Date.
The gross amount of such Additional Cash Distribution will ultimately be US$250 million, and must be deducted from it (i) commissions payable to the supporting parties to the Reorganization Plan under their respective support agreements as reported by essential fact dated October 11, 2022, for extending the deadline of such agreements until November 30, 2022; and (ii) certain cash payments to be made by the Company with the support of bearing creditors in the context of Chapter 11 Proceedings. Considering these adjustments, the amount to be distributed as Additional Cash Distribution will be approximately US$175 million.
3. As soon as the Effective Date occurs, the Board of Directors shall convene an Extraordinary Shareholders’ Meeting to proceed with the total renewal of the Company’s Board of Directors, in the terms provided for in the Fourth Transitory Article of the Company’s bylaws.
Yours sincerely yours,
DocuSigned by:
LODErTO O
Robetó Alo MÍ:
General Manager
LATAM Airlines Group S.A.
Link to file in CMFChile: https://www.cmfchile.cl/sitio/aplic/serdoc/ver_sgd.php?s567=815f005c2db416892031ec5f9b1cb298VFdwQmVVMXFSWGROUkZGNFRWUm5NVTUzUFQwPQ==&secuencia=-1&t=1682376108
