![]() Exide Technologies Public-Side DIP Lender Presentation September 30, 2014 Exhibit 99.1 |
![]() 2 Disclaimer This presentation may contain certain statements that may be deemed “forward-looking statements” as defined in the U.S. Private Securities Litigation Reform Act of 1995. All statements that address activities, events or developments that we intend, expect, plan, project, believe or anticipate will or may occur in the future are forward-looking statements. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. The Company undertakes no obligation to update or revise any forward-looking statements. Examples of forward-looking statements include, but are not limited to (a) projections of revenues, cost of raw materials, income or loss, earnings or loss per share, capital expenditures, growth prospects, dividends, the effect of currency translations, capital structure, and other financial items, (b) statements of plans and objectives of the Company or its management or Board of Directors, including the introduction of new products, or estimates or predictions of actions by customers, suppliers, competitors or regulating authorities, (c) statements of future economic performance, (d) statements regarding liquidity and (e) statements of assumptions, such as the prevailing weather conditions in the Company’s market areas, underlying other statements and statements about the Company or its business, and (f) statements regarding tax and liquidity impacts from asset sales and restructuring activities. Factors that could cause actual results to differ materially from these forward looking statements include, but are not limited to, the following general factors such as: (i) the ability of the Company to develop, prosecute, confirm and consummate the Chapter 11 plan of reorganization, (ii) the potential adverse impact of the Chapter 11 filing on the Company's liquidity and operations and the risks associated with operating businesses under Chapter 11 protection, (iii) the ability of the Company to comply with the terms of the DIP financing facility, (iv) the Company's ability to obtain additional financing, (v) the Company's ability to retain key management and employees, (vi) customer response to the Chapter 11 filing, (vii) the risk factors or uncertainties listed from time to time in the Company's filings with the Securities and Exchange Commission (including, without limitation, those risk factors described in the Company’s fiscal 2014 Form 10-K for the fiscal year ended March 31, 2014) and with the U.S. Bankruptcy Court in connection with the Company's Chapter 11 filing, (viii) the fact that lead, a major constituent in most of the Company’s products, experiences significant fluctuations in market price and is a hazardous material that may give rise to costly environmental and safety claims, (ix) the Company’s ability to implement and fund business strategies based on current liquidity, (x) the Company’s ability to realize anticipated efficiencies and avoid additional unanticipated costs related to its restructuring activities, (xi) the cyclical nature of the industries in which the Company operates and the impact of current adverse economic conditions on those industries, (xii) unseasonable weather (warm winters and cool summers) which adversely affects demand for automotive and some industrial batteries, (xiii) the Company’s substantial debt and debt service requirements which may restrict the Company’s operational and financial flexibility, as well as imposing significant interest and financing costs, (xiv) the litigation proceedings to which the Company is subject, the results of which could have a material adverse effect on the Company and its business, (xv) the realization of the tax benefits of the Company’s net operating loss carry forwards, which is dependent upon future taxable income, (xvi) competitiveness of the battery markets in the Americas and Europe, (xvii) risks involved in foreign operations such as disruption of markets, changes in import and export laws, currency restrictions, currency exchange rate fluctuations and possible terrorist attacks against U.S. interests, (xviii) the ability to acquire goods and services and/or fulfill later needs at budgeted costs, (xix) general economic conditions, (xx) the Company’s ability to successfully pass along increased material costs to its customers, (xxi) recently adopted U.S. lead emissions standards and the implementation of such standards by applicable states, and (xxii) the Company’s ability to resume operations at its Vernon, California recycling facility. |
![]() 3 I. Chapter 11 Process Update II. DIP Amendment Request III. Q&A Agenda |
![]() 4 Introduction Exide Technologies (“Exide” or the “Company”) appreciates the opportunity to meet with public-side DIP lenders to provide an update on its Chapter 11 process and discuss the DIP amendment request Since the July DIP lender call, certain developments have materialized that delayed the Company’s plan of reorganization (“POR”) process Inventory overstatement at Canon Hollow Increased financial demands from California regulators related to the Vernon, CA facility permit process and remediation activities Recently announced DOJ/EPA inquiry in connection with Vernon The Company has made progress to resolve these issues but is unlikely to satisfy the Plan Support Agreement (“PSA”) condition for DIP maturity extension by October 12 Conversations with regulators and POR negotiations with the Unofficial Committee of Senior Secured Noteholders (“UNC”) continue Exide is hopeful that it will reach agreement in the near-term on a POR term sheet supported by the UNC The Company will also begin to explore other strategic alternatives as outlined by the amendment Provides assurance of clear exit paths for the Chapter 11 case Given the current situation, the Company is requesting certain amendments to its DIP facilities to provide for the time and flexibility necessary to pursue restructuring strategies to maximize value |
![]() 5 Dual-Track Timeline Set forth below is the timeline and key dates associated with the Company’s contemplated dual-track restructuring strategy POR negotiations and sale process preparation/launch January 15, 2015 Court approval of stalking horse bid procedures November 17, 2014 Sign PSA or begin sale process/distribute marketing materials January 15, 2015 Court approval of Disclosure Statement March 10, 2015 Confirmation of an acceptable POR March 31, 2015 Plan effectiveness March 10, 2015 Court approval of sale March 31, 2015 Sale consummation December 23, 2014 Signed stalking horse agreement September 24, 2014 DIP lender meeting |
![]() 6 I. Chapter 11 Process Update II. DIP Amendment Request III. Q&A Agenda |
![]() 7 Maturity Date March 31, 2015 (5¹/2 month extension) (1) Financial Covenants Remove minimum EBITDA covenant Minimum liquidity covenant: $50 million ($15 million increase) Minimum US liquidity covenant: $25 million (new provision) US liquidity defined as US cash plus excess availability Maximum capital expenditures based on schedule below with no carry-over (new provision): Negative Covenants Permitted asset sale basket of $25 million removed with exception for Nox credit sale process recently approved by the Court Tighten permitted debt baskets Milestones Signed PSA or initiation of sale process – 11/17/2014 If POR process pursued: Disclosure Statement approval – 1/15/2015 Confirmation – 3/10/2015 If sale process pursued: Signed stalking horse agreement – 12/23/2014 Stalking horse agreement/bid procedures approved – 1/15/2015 Sale approved – 3/10/2015 Other ABL Lenders extend with the following proposed modifications: Revolver commitment reduced to $200 million ($25 million reduction) Ability to exercise remedies at the direction of Required Revolver Lenders (instead of Required Lenders) in effect under certain circumstances if POR not delivered in accordance with adjusted milestones Cash anti-hoarding provision Refreshed field exam and inventory appraisal update by 9/30 Termination of the delivered stalking horse agreement shall be an event of default Pricing: Amendment Fee 75 bps Timing Signature pages due by 5 p.m. New York time on Friday, October 3 Level $35 million $12.5 million Quarter-ending 12/31/2014 Each month thereafter Period DIP Amendment Request (1) Initial maturity extension through November 4, 2014, with full maturity extension conditioned on court approval of the pricing components of the amendment, which will be retroactively effective upon court approval. (2) Payable on full commitment amount at 12/31/14. Drawn Undrawn Duration Fee (2) Existing L+325 bps 50 bps N/A Post amendment L+400 bps 100 bps N/A After 12/31/14 L+450 bps 150 bps 50 bps rd |
![]() 8 Closing Remarks Well-defined process in place with clear path to consummation of Chapter 11 case Continued support of DIP lenders is critical to positive outcome More time and flexibility needed to bridge to POR or organized sale process Would avoid significant risk to all stakeholders in unmanaged scenario |
![]() 9 I. Chapter 11 Process Update II. DIP Amendment Request III. Q&A Agenda |