Kleopatra Finco - Chapter 11 Plan / RSA Terms

RSA Terms

Overview

• On November 4, 2025, the Debtors entered into a Restructuring Support Agreement (the “RSA”) with the Consenting Senior Creditors, the CastleKnight Funds, and the SVP Funds.
  • Support for the RSA includes holders of over two-thirds of the First Lien Claims and over two-thirds of the Second Lien Claims.
• The RSA contemplates a restructuring pursuant to a Chapter 11 Plan that preserves value for stakeholders and avoids value-destructive litigation. Key components of the agreement include:
  • Equitization: Consenting First Lien Secured Creditors agreed to equitize their secured claims to facilitate reorganization.
  • Liquidity and Forbearance: Required First Lien holders provided crucial forbearances regarding defaults under the Senior Facilities Agreement and First Lien Secured Notes Indenture, alongside Prepetition Bridge Financing and a DIP Facility to fund operations and restructuring costs.

Plan Classification and Voting

• The Plan designates Class 3 (First Lien Claims) and Class 4 (Second Lien Claims) as the only Voting Classes.
  • As evidenced by the Voting Report, each Voting Class voted to accept the Plan with respect to each Debtor.
• The treatment of other classes is as follows:
  • Deemed to Accept: Class 1 (Other Secured Claims), Class 2 (Other Priority Claims), and Class 5 (General Unsecured Claims) are Unimpaired and conclusively presumed to accept the Plan.
  • Deemed to Reject: Class 8 (Section 510(b) Claims) and Class 9 (KH2 Equity Interests and KPA Equity Interests) are Impaired and deemed to reject the Plan.

Financing and Liquidity

• DIP Facility: Provided by the DIP Lenders and DIP Agent to fund the Chapter 11 Cases through emergence.
  • Upon the Effective Date, the Debtors are authorized to pay all DIP Fees and Expenses without further court order.
• Exit Facility: On the Effective Date, the Reorganized Debtors shall enter into the Exit Facility.
  • Confirmation of the Plan constitutes approval of the facility and deems all related liens as legal, valid, binding, automatically perfected, first-priority, and non-avoidable.
• Factoring Program: The Plan authorizes the continuation of the Factoring Program and the reinstatement of Allowed Factoring Claims.
  • Transfers of receivables under the program are deemed non-recourse true sales for fair consideration and are not subject to avoidance or recharacterization.

Restructuring Transactions and New Equity

• Cancellation of Debt: Subject to the effectiveness of the Exit Facility, all notes and instruments evidencing Claims—including the First Lien Secured Notes Indenture, Second Lien Secured Notes Indenture, and Senior Facilities Agreement—shall be cancelled on the Effective Date.
• New Equity Issuance: New Kleo Holdco or Reorganized KH2 (the “New Equity Issuer”) will issue New Equity Interests without the need for further corporate action.
  • A Shareholders Agreement, consistent with the Governance Term Sheet filed in the Plan Supplement, will govern the new interests.
• Holding Period Trust: The Debtors may establish a trust to hold New Equity Interests for 18 months following the Effective Date for parties failing to deliver Share Delivery Documents.
  • If the required documentation is not delivered upon the expiration of the 18-month period, the applicable New Equity Interests will be forfeited.

Releases

• The Plan includes a Debtor Release applicable to parties who affirmatively supported the Plan, as well as a Third-Party Release with an opt-out mechanism.
• Exclusions and Opt-Outs:
  • BlackRock: Related Parties of BlackRock Consenting Creditors are not deemed Releasing Parties unless such Related Party individually signed the RSA.
  • Kenvue: Kenvue Brands LLC and its affiliates (collectively, “Kenvue”) are deemed to have opted out of the Third-Party Release and shall not be considered Releasing Parties.