Lumileds Announces Agreement with Required Lenders on Terms of Comprehensive Financial Restructuring to Accelerate Long-Term Growth

SAN JOSE, Calif.–(BUSINESS WIRE)–Lumileds Holding BV (“Lumileds” or the “Company”), a global leader in innovative lighting solutions, today announced that it has entered into a Restructuring Support Agreement (the “RSA” or the ” Agreement”) with its lenders holding a substantial majority of loans outstanding under its senior loan facility prior to petitioning for the terms of a comprehensive financial restructuring that would significantly reduce its leverage and strengthen its balance sheet by more than $1.3 billion, would accelerate Lumileds’ growth and enable new investments in innovation to pursue additional strategic opportunities by injecting up to $275 million in cash.

To effectively implement the deleveraging, a narrowly focused pre-packaged Chapter 11 plan (the “Plan”) involving only the U.S. and Dutch entities of Lumileds was launched in the U.S. Bankruptcy Court for the Southern District of New York (the “Court”). “). European, Asian and foreign subsidiaries and affiliates of Lumileds are not included in the filing and are not affected by the Chapter 11 process. process and expects to meet the requirements to confirm the Plan and exit Chapter 11 within approximately sixty days.

“Over the past few years, we have worked hard to transform our cost structure and innovation pipeline, allowing us to more effectively capitalize on future market trends as an industry leader. lighting,” said Matt Roney, CEO of Lumileds. “We have taken proactive steps to deleverage our balance sheet given the ongoing challenges posed by global supply constraints, COVID-related issues and the crisis in Ukraine. This recapitalization will allow us to further accelerate our efforts as a market-leading innovator within the specialty lighting industry. We believe the most effective and efficient way to achieve this is through a pre-packaged Chapter 11 process that will come with a significant increase in our liquidity position. We appreciate the support of our lenders, who recognize the long-term value and increased potential that Lumileds will create with a strengthened balance sheet.

AS PER USUAL

None of the Company’s business operations outside of the United States and the Netherlands are part of the Chapter 11 proceedings. continue to operate its business and facilities in the normal course without disrupting its customers, vendors, suppliers or employees. As part of these day one motions, the Company has sought court approval to continue to pay all valid amounts due to vendors and suppliers as they become due. In addition, the Company expects employees to continue to receive their regular salary and benefits without interruption.

“Our number one priority is to provide ground-breaking solutions in lighting, security and well-being,” added Mr. Roney. “This comprehensive liquidity and deleveraging solution will allow us to be an even more attractive and stronger partner as we continue to drive innovation in LED technology and bring new products and solutions to our customers. I would like to thank all of our valued employees, customers, vendors, suppliers and sponsors for their continued support.

TERMS AND CONDITIONS OF THE RESTRUCTURING SUPPORT AGREEMENT

Under the terms of the RSA, existing secured lenders must pledge to support and vote in favor of a transaction which, when executed, will reduce the company’s funded debt by approximately $1.3 billion from approximately $1.7 billion to $400 million, comprising repossession debt and post-petition loans, which will be combined into a 5-year exit facility.

RSA is also considering a commitment from some of its lenders of up to $275 million in debtor-in-possession (“DIP”) financing, available through the Chapter 11 process. Subject to court approval, the DIP financing, together with the Company’s available cash reserves and cash provided by operations, should provide sufficient liquidity for Lumileds to continue to meet its outstanding obligations, including all obligations to customers, vendors and suppliers, as well as wages, salaries and employee benefit programs.

More information about the Lumileds restructuring, including access to court documents, will be available at https://dm.epiq11.com/Lumileds or by contacting Epiq Corporate Restructuring, LLC, the Notice and Claims Agent. company at +1 800-497-9116 (for free domestic calls) and +1 503-520-4495 (for chargeable international calls) or by emailing [email protected]

Evercore acts as an investment banker for the Company; Paul, Weiss, Rifkind, Wharton & Garrison, LLP, and Latham & Watkins LLP are acting as corporate and restructuring counsel for Lumileds, and AlixPartners, LLP is acting as financial advisor. PJT Partners is acting as financial advisor to an ad hoc group of Lumileds lenders, and Gibson, Dunn & Crutcher LLP is acting as group legal advisor.

About Lumileds

Lumileds is a global leader in OEM and aftermarket automotive lighting and accessories, camera flashes for mobile devices, MicroLEDs and light sources for general lighting, horticulture and center centric lighting. the human. Our more than 7,000 employees operate in more than 30 countries and partner with our customers to provide unprecedented solutions in lighting, security and well-being. To learn more about our company and our solution portfolios, please visit https://lumileds.com.

Certain statements contained in this press release are forward-looking statements within the meaning of and made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act. of 1934, as amended. In addition, our management may, from time to time, make forward-looking oral statements. All statements, other than statements of historical fact, are forward-looking statements. Forward-looking statements can be identified by the words “believe”, “expect”, “anticipate”, “project”, “plan”, “estimate”, “may”, “will”, “could”, “should”. “, “seek” or “intend” and similar expressions. Forward-looking statements reflect our current expectations and assumptions regarding our business, the economy and other future events and conditions and are based on currently available financial, economic and competitive data and our current business plans. Actual results could vary materially depending on risks and uncertainties that may affect our operations, markets, services, prices and other factors. Although we believe that our assumptions are reasonable, we caution you against relying on forward-looking statements because it is very difficult to predict the impact of known factors and it is impossible for us to anticipate all factors that could affect our results. real. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, our ability to obtain bankruptcy court approval with respect to petitions filed in the matters Chapter 11 filings and the results of bankruptcy court rulings and Chapter 11 cases generally, the effectiveness of overall restructuring activities pursuant to Chapter 11 filings, and any additional strategies we may employ to manage our liquidity and our capital resources, actions and decisions of creditors, regulators and other third parties who have an interest in Chapter 11 matters, restrictions imposed on us due to the terms of any debtor credit facility in possession that we may enter into in connection with Chapter 11 cases and the restrictions imposed by the court of f ailite, the schedule for resolution and any impact of the network security incident, a weakening of global economic and financial conditions, interruptions in the supply or increase in the cost of raw materials, loss or difficulties in achieve further cost savings from our strategic initiatives, the impact of our significant indebtedness, our failure to meet financial covenants under our credit facilities or other indebtedness, pricing actions taken by our competitors that could affect our operating margins, changes in government regulations and related compliance and litigation costs, and other factors. All forward-looking statements are expressly qualified in their entirety by this cautionary statement. Forward-looking statements made by us speak only as of the date on which they are made. Factors or events that could cause our actual results to vary may arise from time to time. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as required by law.