Ascend Performance Materials - Chapter 11 Plan Terms

Plan Terms

Overview

• The Debtors filed the Fourth Amended Joint Chapter 11 Plan of Reorganization (the “Plan”) on Dec. 9, 2025, following the commencement of their Chapter 11 cases on April 21, 2025.
• The Plan incorporates settlements and restructuring transactions supported by an “Ad Hoc Group” comprised of DIP Term Loan Lenders, Bridge Lenders, and Term Loan Lenders.
• Upon the Effective Date, the Reorganized Debtors will emerge as a private company and will not be subject to SEC reporting requirements or listed on a national securities exchange.

DIP Financing Treatment

• DIP ABL Claims: Holders will receive full cash payment or, at the election of the applicable lender, roll their claims into the Exit ABL Facility via a cashless settlement.
  • Accrued interest and fees will be paid in cash on the Effective Date.
• DIP Term Loan Claims: In full satisfaction of their claims, holders will receive their pro rata share of:
  • The “DIP Equity Recovery,” representing 100% of the New Interests (minus the Ascend Interest Distribution), subject to dilution by the Management Incentive Plan and certain Exit Term Loan features.
  • Litigation Trust Class A Interests.
  • Rights to participate in the Debt Rights Offering.

Exit Financing & Rights Offering

• Exit ABL & Term Loan Facilities: The Reorganized Debtors are authorized to enter into new exit facilities, including an Exit Term Loan Facility with the following key terms:
  • Borrower: Reorganized Ascend, with guarantees from certain subsidiaries.
  • Interest Rate: 8.0% per annum, payable-in-kind (PIK).
  • Maturity: Five years from issuance, with no amortization and no financial covenants.
  • Conversion Feature: To the extent applicable, the facility may convert into 90% of the New Interests.
  • Additional Equity Commitment: Lenders provide a commitment to pay $75 million post-Effective Date for 21% of the New Interests (calculated as if the conversion feature were fully exercised).
• Debt Rights Offering: The Debtors commenced a $235 million offering open to eligible offerees.
  • The offering is fully backstopped by the Debt Backstop Parties (members of the Ad Hoc Group).
  • As consideration, the Backstop Parties will receive a premium equal to 10% of the backstopped amounts, payable as additional principal in the Exit Term Loan Facility.
• Takeback Debt: The Reorganized Debtors will issue specific takeback debt instruments with defined payment schedules:
  • 36th Street Financing: Matures June 1, 2029, with monthly payments escalating from $50,000 to $310,000 over the term.
  • Ansley Park Financing: Matures Nov. 1, 2033, with monthly payments increasing from $250,000 to approximately $548,000, plus a final balloon payment.
  • Citizens CoGen Financing: Matures July 1, 2031, secured by a first-priority lien on specific collateral. Terms include a principal payment holiday through Jan. 1, 2027, followed by quarterly payments and a final balloon payment of approximately $56.9 million.

Treatment of Claims & Interests

• Term Loan Claims: Holders will receive their pro rata share of Litigation Trust Class C Interests.
• General Unsecured Claims: Holders will receive their pro rata share of Litigation Trust Class D Interests.
  • Excluded Parties are prohibited from receiving distributions from Litigation Trust Assets.
• Go-Forward Vendor Claims: Holders will share in a recovery pool consisting of the lesser of $13.7 million or 25% of the cumulative allowed claims in this class.
• Interests in Ascend Parent: Holders will receive the “Ascend Interest Distribution,” equating to 0.3% of the New Interests, carved out from the recovery otherwise allocated to DIP Term Loan Claims.

Litigation Trust

• A Litigation Trust will be established to liquidate assets and reconcile claims, with no objective to continue trade or business operations.
• Trust Assets: The trust will hold “Permitted Litigation Claims,” defined as causes of action against Excluded Parties or other claims designated by the Special Committee with the consent of the Required DIP Term Loan Lenders.

Releases & Settlements

• The Plan incorporates several settlements, including the Committee Settlement, the MasTec Settlement, and the Novus Settlement, resolving disputes among the Debtors, the Committee, and various lenders and vendors.
• Releases: The Plan provides for standard Debtor and Third-Party Releases for "Released Parties," including the Debtors, Reorganized Debtors, DIP/ABL Lenders, the Ad Hoc Group, and the Committee.
• Excluded Parties: The "Sponsor," Rescar Companies, and other entities identified on a schedule are designated as "Excluded Parties."
  • Excluded Parties are not released under the Plan and are deemed to have opted out of the Third-Party Releases.

Management Incentive Plan

• On or after the Effective Date, the New Board will adopt a Management Incentive Plan (MIP).
• Grants under the MIP will ratably dilute all New Interests, including those issued under the DIP Equity Recovery and the Debt Rights Offering.