CONFIDENTIAL OCTOBER 2025

D I S C U S S I O N M AT E R I A L S

Introduction to Restructuring
 CONFIDENTIAL INTRODUCTION TO RESTRUCTURING

I Fundamental Concepts
INTRODUCTION TO RESTRUCTURING I FUNDAMENTAL CONCEPTS

Classification
Debt is often a broader investment category than Equity. Each type of debt listed in the table below will be characterized by a particular risk/return
profile, which is the result of the combination of at least four different factors

Key Factors Capital Categories

Senior o first lien (incl. factoring, etc.)

Capacity to pay
Secured Second lien

Mezzanine (Old LBOs)

Debt Bond or unsecured loan

Collateral / Security
Unsecured PIK notes / Mezzanine

Vendor loan

Subordinated Loan / Bond

Ranking / Seniority
Hybrid Convertible Bond

Shareholder Loan
Equity
Preferred Shares
Covenants "Pure" Equity
Ordinary Shares

• These factors are obviously strongly interrelated: the greater the debtor's "capacity to pay" and the higher the priority level of the financing
compared to other debts on the balance sheet, the lower the yield of the financing, the covenants imposed, and the collateral required from the
debtor

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INTRODUCTION TO RESTRUCTURING I FUNDAMENTAL CONCEPTS

“Capacity to pay”
Moody’s S&P/fitch Long-Term Rating Definition Example
• Prime Grade: extremely robust ability to service interest and repay principal. Only a few companies get • Microsoft, J&J
Aaa AAA
this rating
Aa1 AA+ • High Grade: financial strength slightly lower than the previous rating category • Apple, Alphabet
Aa2 AA
Aa3 AA-

A1 A+ • Upper Medium Grade: solid ability to pay interest and principal, however subject to some risk in the • ENI, EssilorLuxottica
A2 A presence of negative events and macroeconomic crisis situations
A3 A-

Baa1 BBB+ • Medium Grade: adequate ability to service debt. In adverse market situations or in the presence of • Enel, GE, Stellantis, Intesa
Baa2 BBB negative events, the debtor may show financial weaknesses Sanpaolo
Baa3 BBB-

Ba1 BB+ • Speculative Grade: weak financial situation, with substantial default risks. Market uncertainties or • Webuild, Mundys
Ba2 BB adverse events can easily result in a deterioration in the ability to service debt
Ba3 BB-
The subsequent rating categories ('B', 'Caa', 'Ca' and 'C') are increasingly vulnerable (the C rating is the • Most corporate HY bond in
antechamber of failure). The creditor must constantly monitor the credit and take the necessary LBOs target a B rating at
precautions (covenants, collateral, etc.), since the debtor has a high risk of not being able to service interest issuance (e.g. Acqua e
and/or principal Sapone, CEME, Fedrigoni)
Rating category 'D': debtor officially in a state of insolvency

• In more quantitative terms, the capacity to pay can be identified by the combination of various ratios

Ebitda/
Debt / EBITDA Debt / Equity FFO / Debt
Interest

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INTRODUCTION TO RESTRUCTURING I FUNDAMENTAL CONCEPTS

Collateral
• Collateral, that is, the security in favor of the creditor, can take various forms (in Italy: mortgage, pledge, or lien – see Civil Code) and can involve a
wide range of the debtor's assets

TYPE OF COLLATERAL EXAMPLE KEY CHARACTERISTICS TYPE OF COLLATERAL FORM

Liquid • Cash • Limited construction costs • Pledge
• Tradable securities • Possession of the asset
FINANCIAL ASSETS • Trade receivables (receivable) transferred to the creditor

• Raw materials • Easily liquidated (commodity vs. • Pledge, lien

• Finished goods specialty)
INVENTORY • "Innovation" risk

• Cars, Transportation • Easily liquidated, if not • Pledge, lien

• Container specialized and on adequate
OTHER TANGIBLE ASSETS markets
• "Innovation" risk

• Sales areas • Importance of localization • Mortgage

• Factory • Adequacy of assessments
REAL ESTATE • Warehouses • Environmental issues
• Offices • High costs and construction
times
• Machinery and systems • High costs and construction • Any type (case by case)
• Land times
OTHER • Trademarks and patents • Adequacy of assessments
• Available counterparties?
Illiquid

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INTRODUCTION TO RESTRUCTURING I FUNDAMENTAL CONCEPTS

Subordination or “Ranking”
While determining the risk - and thus the return associated with a debt instrument - it is essential to understand its subordination relative to the rest
of the capital structure
• Subordination or "ranking" defines the order of priority in which a debt is repaid compared to others
• At least three different types of subordination can be distinguished:

LEGAL SUBORDINATION STRUCTURAL SUBORDINATION TEMPORAL SUBORDINATION

• The ranking of a specific instrument is • Subordination is determined by the structure • With equal structural and contractual ranking,
contractually established of the financing operation a de facto subordination can be determined
for the creditor whose repayment is
• A typical example consists of LBO financings • In particular, the "position" of the borrower
temporally postponed compared to other
that often consist of multiple tranches with within the group will be relevant
creditors
different seniority (e.g.: Senior tranche vs.
• The most typical case is that of HoldCo
subordinated/junior tranche) • Consider the typical case of a Term Loan A
financing, which by structure can only be
(amortizing) and a Term Loan B (Bullet) that
• The relationship between the different repaid if the OpCo's credit has been fully
are integral parts of the same financing
tranches or instruments is defined in an satisfied
contract
Intercreditor Agreement
• Despite TLA and TLB having the same
Holdco contractual ranking and the borrower being
HoldCo
HoldCo Lender the same, the TLA creditor will see a
Shareholder Financing progressive reduction in their risk thanks to
loan or new 100%
equity the periodic capital repayments received. The
OpCo TLB creditor, on the other hand, will remain
OpCo
Lenders exposed to 100% of the risk until maturity

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INTRODUCTION TO RESTRUCTURING I FUNDAMENTAL CONCEPTS

Covenants
• Covenants are constraints that creditors "impose" on the debtor. They have three main functions:

− Prevent the management of the debtor company from making choices that negatively affect the quality of the credit

− Protect the debtor's corporate assets from claims by other creditors and shareholders

− Monitor the financial and asset situation of the debtor

• Covenants can be of three types and have different gradations depending on the negotiating power of the parties:

NEGATIVES (PROHIBITIONS) POSITIVES (OBLIGATIONS) FINANCIALLY

• Along with obligations, they primarily serve the • Along with prohibitions, they primarily serve the • They primarily serve the monitoring function:
first two purposes described earlier: first two purposes described earlier: ---
--- --- • Financial leverage (Debt/EBITDA)
• Absolute restrictions or prohibitions on: • Informational obligations • Interest coverage (EBITDA/Interest)
− Extraordinary operations such as mergers • Compliance with laws and regular payment of • Debt service (Cash flow / [Interest +
and acquisitions taxes and duties Repayment])
− Spin-offs, demergers, and asset sales • Preservation of tangible and intangible assets • Maximum capital expenditure
− Incurrence of additional debt (including maintaining insurance coverage) • Etc.
− Remuneration of shareholders • Stability of the shareholder structure (or at least
− "Negative pledge" the main shareholders)

• "Maintenance Covenants": financial covenants regularly tested on a periodic basis

• "Incurrence Covenants": tested only in the event of specific occurrences, typically when the borrower seeks to incur additional debt
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INTRODUCTION TO RESTRUCTURING I FUNDAMENTAL CONCEPTS

Capital Structure: Summary

ILLUSTRATIVE TARGET
CAP STACK LAYERS RANKING SECURITY/COLLATERAL RECOVERY RATE
YIELD

Junior • Junior compared to all instruments

• 15-25% depending
COMMON EQUITY • Receives the residual value once all • N.a.
on strategies
creditors have been satisfied

PREFERRED EQUITY • Equity instrument with a preferential • N.M.

• N.a. • 15-20%
INSTRUMENTS economic component

• Quasi Equity, senior to preferred or

SHAREHOLDER LOANS • Chirograph • 12-15%
common equity instruments only

• Contractually and/or structurally

SUBORDINATED/ subordinated to Senior debt
• 10-15%
MEZZANINE DEBT • Senior vs. any equity/equity-like • On average, in the
instrument • Chirograph event of default,
• Can have a pledge on the shares credit recovery is
• Junior vs. 1st and 2nd Lien around 0-25%
SENIOR UNSECURED DEBT • 8-12%
• Senior to everything else

• Second lien guarantee on the same

SENIOR (SECURED)
• Junior vs. Senior Secured Debt assets placed as collateral for Senior • 5-10%
2ND LIEN DEBT • On average, in the
Secured creditors
event of default,
credit recovery is
• Debt secured by assets (shares,
SENIOR (SECURED) • Senior to any other debt/claim of the around 50-75%
receivables, current accounts, fixed • 3-5%
1ST LIEN DEBT company
assets, etc.)
Senior

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 INTRODUCTION TO RESTRUCTURING I FUNDAMENTAL CONCEPTS

How is the capital structure represented? There is only one way!

SUMMARY CAPITALIZATION TABLE

DRAWN BV BV TO MARKET MARKET INTEREST

@ 31-12-2024E EBITDA '24E PRICE VALUE RATE REPAYMENT MATURITY

Term Loan A 45.5 1.4x 67.5% 30.7 E+210bps Amortizing Jul-25

Term Loan B 74.9 2.3x 67.5% 50.5 E+260bps Bullet Jul-25
Term Loan C 60.0 1.8x 67.5% 40.5 E+310bps Bullet Jul-25
Term Loan F 31.3 1.0x 67.5% 21.1 E+210bps Bullet Jul-24
Secured
Revolving Facility G 40.0 1.2x 67.5% 27.0 E+210bps Bullet Jul-25
lines
Total Senior Debt 251.7 7.7x 169.9
Second Lien 30.0 0.9x 55.0% 16.5 E+510bps Bullet Jul-27
Mezzanine Debt 78.5 2.4x NA 78.5 E+475bps, PIK 500bps Bullet Jul-27
Total Pool 360.2 11.1x 264.9
Bilateral Facilities 17.2 0.5x NA 17.2 E+400bps - -
Leasing 0.8 0.0x NA 0.8 NA - -
Total Gross Debt 378.2 11.6x 282.9
Cash and Equivalents (13.3) (13.3)
Net Debt 364.9 11.2x 269.6
Financing Fees/IAS Adj. (7.4) (7.4)
Net Debt IAS 357.5 11.0x 262.2
Shareholder Loans 43.5
Shareholders' Equity 38.9
Total Capitalization 447.3
EBITDA 2024E 32.5

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 CONFIDENTIAL INTRODUCTION TO RESTRUCTURING

II Loan Agreements
INTRODUCTION TO RESTRUCTURING II LOAN AGREEMENTS

Basic elements
The loan agreement is generally signed by one or more banks with the debtor, but it includes clauses that regulate its potential assignment to other
creditors (banks or funds)
• For medium/large-sized transactions (exceeding €150/200m) that require international syndication (i.e., risk distribution and the 'sale' of the loan
to a wide audience of potential creditors), it has become common practice to negotiate loan agreements based on the more advanced and
standardized Anglo-Saxon regulations ('Loan Market Association' or 'LMA' Standards)

• A loan agreement consists of the following essential parts:

− Definitions (contract glossary)

− Mechanics of the loan

− Remuneration of the loan

− Borrower’s declarations (also known as “representations & warranties”)

− Covenants (negative, positive and financial)

− Events of default and related consequences

− Schedules & exhibits

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INTRODUCTION TO RESTRUCTURING II LOAN AGREEMENTS

Mechanics of the Loan

• Referring to a structured finance transaction with a senior loan, the contract defines the amount of the different tranches of the acquisition loan
and the revolving line, specifying their respective purposes

• It is used for the acquisition and refinancing of existing debt. Generally available only at the time of the acquisition,
Acquisition loan
any unused commitments at closing are revoked

• It serves the company's working capital needs. Typically, available for the entire duration of the financing, allowing
Revolving line
for multiple drawdowns and repayments

• Typically, there are three types of repayments

• Repayments according to the amortization schedules of each tranche of the acquisition loan. The repayment of
Contractual repayment tranche A is generally tied to a cash flow model (business plan). Tranches B and C are typically bullet or semi-bullet.
Usually, the revolving line is repaid at maturity
• Cases where it is contractually stipulated that credit lines are to be reduced in advance. The list of events includes
disposal of specific assets, capital increases following an IPO or the listing of debt securities, issuance of initially
Mandatory repayment unplanned high yield/mezzanine bonds, change in controlling shareholders
• The percentage of cash generated from such events that must be used to repay the debt is often a subject of
negotiation between the parties

• Voluntary repayment due to excess cash generated during the fiscal year. Except for the revolving line, early
Voluntary repayment
voluntary repayment permanently reduces the credit line

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INTRODUCTION TO RESTRUCTURING II LOAN AGREEMENTS

Remuneration
The remuneration of financing consists of two elements: compensation for financing risk (interest) and fees for services provided by the banks
• The interest rate typically consists of a base rate (Euribor or Libor) plus a spread aligned with the risk profile of each tranche

− Typically, the revolving line has a margin aligned with the debt tranche that provides for gradual repayment. The bullet tranche has a higher
cost

− The contract may include spread adjustments based on the company’s performance and leverage ratio (ratchet mechanism)

• The banks involved in the syndicate are compensated with fees depending on their commitment

Arrangement fee • Compensation to the arranging bank for organizing and managing the syndicate

• Compensates the banks for the risk they undertake in underwriting. It can be proportional to the subscribed share or
Underwriting fee
defined as a flat percentage

Agency fee • Compensates the agent bank, responsible for administering the operation

Commitment fee • A periodic fee for the unused part of committed credit line

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INTRODUCTION TO RESTRUCTURING II LOAN AGREEMENTS

Financial Covenants
In practice, to protect their credit, lenders impose certain covenants on the borrower, which are set out in the loan agreement
• Among financial covenants, the most common are the so-called "cash flow driven" covenants

Type of Covenant Methodology

• Interest Cover = EBITDA/net Interest Expenses
Interest Coverage
• Measures the ability to generate operating cash flow to cover the cost of debt
• Financial Leverage = Debt /EBITDA
Leverage • Assuming a constant EBITDA, this provides a theoretical measure of the number of years needed to repay debt
• A value above 2.5-3x generally indicates a «leveraged transaction»

Max Capital • Maximum annual amount the borrower can spend on Capex
Expenditure • Mechanisms of carry-back / carry-forward of Capex expenses relative to an allowable maximum may be applied
• Debt Service = Cash Flow / [Net Interest Expenses + Debt Repayment]
• This ratio should always be above 1; otherwise, the company is not generating enough cash to meet debt obligations
Debt service
• To fulfill obligations, the borrower must maintain this value above the negotiated threshold with lenders
• This covenant is generally used alongside the first two covenants

• The value of the covenants included in the loan agreement is usually calculated based on the business plan used by the borrower to obtain the
financing

• In line with plan values, the covenant is generally set with a margin (known as “Headroom”) of 20-35%, depending on the borrower’s situation,
plan riskiness, and credit quality

• Generally, at each testing date, the borrower must inform the lender of covenant compliance via a "Compliance Certificate"

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INTRODUCTION TO RESTRUCTURING II LOAN AGREEMENTS

Default and Consequences

• The borrower may default in various ways. Usually, a "Grace Period" is provided to remedy the default («Grace Period»)
Type of Default Description
Non-payment • The borrower fails to make the scheduled payment by the due date («Non-Payment»)

Misrepresentation • False statement, guarantee, or representation made in any document related to the financing («Misrepresentation»)

Financial Covenant
• Breach of one of the financial covenants («Breach of Covenants»)
Breach

Cross default • Default on a loan by a group company that triggers obligations under the financing agreement («Cross Default»)
• Inability of the borrower to meet its debts according to the terms specified in the contracts (commercial or financial)
Insolvency
(«Insolvency»)
• Occurrence of any event that, with reasonable probability, will be significantly averse to the business, assets, or
Material Adverse Effect
financial condition of the company

• The occurrence of any default ("event of default") allows the financing banks to:

− Demand immediate repayment of the amounts disbursed («Acceleration»)

− Cancel unused credit facilities granted to the borrower («Cancellation»)

− Enforce collateral, such as foreclosing on pledged shares or other real guarantees («Enforcement»)

− Transfer their credit to third parties (e.g., hedge funds) («Transfer»)

• During the grace period, the parties may reach an agreement to remedy the default. This opportunity requires the favorable opinion of most of the
financing banks. In cases of minor default due to non-structural causes, banks may consider issuing a waiver. In the case of structural default,
banks may consider restructuring the debt, modifying the repayment plan, or softening the covenants

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 CONFIDENTIAL INTRODUCTION TO RESTRUCTURING

III Restructuring Process

INTRODUCTION TO RESTRUCTURING III RESTRUCTURING PROCESS

Why Do Companies Need Financial Restructuring?

A company with a solid business model but financial issues can be “fixed,” BUT NOT VICE VERSA

Cash-flow mismatch (Debt servicing > Operating cash flows)

FRAUD
(e.g., Parmalat, Enron) Operational underperformance

Increase in operating costs

Financial constraints due to high leverage

OUTDATED OR WRONG BUSINESS MODEL
(e.g., Seat PG, Blockbuster, Kodak)
Extraordinary working capital swings

Limitation to capex and growth

Negative equity
EXCESSIVE LEVERAGE / LACK OF
LIQUIDITY
Breach of financial covenants

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INTRODUCTION TO RESTRUCTURING III RESTRUCTURING PROCESS

“Where The Value Breaks”?

• It is the fundamental question that creates the link between the asset side and the liability side of the balance sheet

• The state of financial distress generally implies a loss/impairment of value for the various stakeholders

• Understanding where value is positioned in relation to the capital structure is essential to identify which stakeholder will suffer the most and who
will be in the driving seat of the restructuring process (“fulcrum security”)

Where the value breaks Capital structure layers

Equity Junior Common Equity

Value breaking in the debt
Portion out of Equity
the money Preferred Shares

Unsecured Vendor / Shareholder Loan Quasi Equity

Debt
50%
Subordinated Junior Debt
recovery

Senior Unsecured

Secured Debt 100% Second Lien Senior Debt

recovery
Secured
Asset value/ Capital Structure at Senior
Fair Market value Book value

• Distressed credit investors are looking for debt that trades “below par” to buy the debt at a discount and profit from the company’s restructuring,
often converting the debt itself into equity (“loan-to-own”)

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INTRODUCTION TO RESTRUCTURING III RESTRUCTURING PROCESS

Many Stakeholders with Different Interests

COMPLEX STRUCTURE

• Multitude of stakeholders
• Multiple “external constituencies”
• Restrictions by law

INVESTORS & COMPETITORS

CREDITORS
• Could play the “white knight” • Preservation and recovery of the credit
• Take advantage of distress to maximize • Different risk appetite and expected
returns return
DISTRESSED COMPANY
• Passive vs. active creditors

MANAGEMENT SHAREHOLDERS

• Responsibility / duty of care • Keep ownership vs giving the keys

• Need to preserve going concern • Reputational risk
• Good money after bad money?

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INTRODUCTION TO RESTRUCTURING III RESTRUCTURING PROCESS

The Restructuring Process

• Generally, a restructuring process can be handled out-of-court or in-court, depending on specific circumstances

• In-court procedures, although they allow for a partial cram-down of dissenting creditors, are often more expensive and longer than processes
managed between the parties without involving the court

1 • Capital structure and debt sustainability • During the process…

ASSESS
OUTSTANDING • Covenant compliance & contracts
ISSUES
− Coaching to help managing the
• Business valuation – where the value “breaks”
company and its liquidity
2 • Preparation of the financial proposal

− Business plan & management actions − Frozen lines

INVESTORS
APPROACH
− Financial engineering

− Restructuring process − Tensions with suppliers

3
• Build consensus around the proposal
− Business slowdown
NEGOTIATIONS
• Manage different layers of creditors

• Finalize the proposal

− Free riders
4
• Voting
IMPLEMENTATION
• Validation under out-of-court/in-court proceedings − Bad noise in the street…

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INTRODUCTION TO RESTRUCTURING III RESTRUCTURING PROCESS

The Advisor’s Role…

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INTRODUCTION TO RESTRUCTURING III RESTRUCTURING PROCESS

The Advisor’s Role (Seriously…)

• Multiple parties
− Managers, employees, shareholders, board members, banks, funds, institutional investors, legal advisors,
HANDLE industrial advisors, regulators, Expert (under Italian Bankruptcy Law)
COMPLEXITIES
• Complex structures
− Several debt layers, intercreditor agreements, different securities/collateral

• Modelling and number crunching

FINANCIAL
• Financial simulations / sensitivities
ANALYSIS
• Assess alternatives

• Mediate conflicting interests and discourage “hold-outs”

INDEPENDENCE
• Play the devil’s advocate to explain how the various stakeholders think and work

• Know-how
EXPERIENCE • Creative thinking to address issues and find sensible solutions
• Handle time pressure

• Prepare managers to face the restructuring and to deal with lenders

COACHING
• Coach lenders committees to the Italian framework

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 CONFIDENTIAL INTRODUCTION TO RESTRUCTURING

IV Trevi Group Case Study

INTRODUCTION TO RESTRUCTURING IV CASE STUDY

Snapshot of Trevi Group at the Start of the Restructuring Process

Business Overview Financial Results

• Founded in 1957 in Reggio Emilia, Italy, Trevi Group (‘Trevi’ or the ‘Group’) is a
world leader in underground engineering for special foundations, tunnelling, soil (€m) 2013 2014 2015 2016 2017B
consolidation, and the manufacture and marketing of specialised machinery and
equipment for the sector Revenue 1,275.8 1,250.7 1,342.3 1,120.0 947.0
• The Group had two main divisions:
− Foundation Engineering: foundation engineering services EBITDA 143.8 126.4 8.9 76.0 1.0
− Oil and Gas: construction of drilling platforms
• Trevi Finanziaria Industriale is the holding company, consisting of four divisions: EBITDA % 11.3% 10.1% n.m. 6.8% n.a.
− Trevi S.p.A.: subsoil engineering
− Petreven S.p.A.: drilling services Net Results 13.8 24.4 (115.2) (84.0) (158.0)
− Soilmec S.p.A.: subsoil equipment
− Drillmec S.p.A.: drilling equipment Net Debt 443.6 379.6 420.2 440.0 566.0
• The Group operates in over 40 countries and has 6,569 employees
• The Group's shareholding structure consists of a 40% free float, Trevi Holding SE at Leverage 3.1x 3.0x n.m. 5.8x n.a.
33%, CDP Equity at 17%, and Polaris at 10%

Share Trends and Performance Summary

€ k
16 27/04/2017 15/05/2017 19/05/2017 07/10/2017 13/11/2017 1,000
14 Unexpected cancellation of Q1 2017 results below Standstill' request to major Cerved downgrades credit Postponement of the approval
Drillmec's contract in Bolivia expectations banks, signalling financial rating from B2.1 to C1.1 of the accounts to 3Q17 800
12 difficulties
10 27.8%
600
8
6 400
4
200
(62.4%)
2
- -
Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17
Volume TreviGroup FTSE MIB
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INTRODUCTION TO RESTRUCTURING IV CASE STUDY

Factors that Led to the Need for Recapitalisation

• In 2015, the Drillmec division recorded a loss of approximately €80m on an offshore

Maxi contract in the Gulf of Mexico due to unforeseen transportation and installation costs,
Depreciation resulting in a total impact of €90m on consolidated EBITDA
of Drillmec • In 2017, the Drillmec division was negatively impacted by the cancellation of a contract
in Bolivia and the drop in oil prices

• During 2017, there was a significant deterioration in results: pre-closing figures showed
Current estimated Revenues and EBITDA lower by approximately €170m and €50m compared
Financial to 2016, and an increase in Net Debt of over €125m, to €570m
Performance
• All divisions, except for Petreven, deteriorated significantly

Impact on • Pre-closing figures indicate an approximate €200m drop in equity, largely due to
NEED FOR CAPITAL
Net Assets Drillmec division's losses of around €280m
STRENGTHENING

Restatement of • The expected results for 2017 and the possible “restatement” of
Repurchase repurchase/leaseback agreements, together with the demands of the lending banks,
CRO Nomination
Agreements / have generated further nervousness and a climate of uncertainty among lenders,
Leases causing greater operational rigidity in the group's lines Appointment
Advisors
Financial
• The backlog for the Trevi division has significantly reduced compared to previous years, Legal
Backlog totaling €370m in 2017 versus €630m in 2016
Strategic
• Forecast for 2018 remains challenging in relation to order intake in 2017

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INTRODUCTION TO RESTRUCTURING IV CASE STUDY

Financial Manoeuvre Drafting Process

Analysis of Current Business Prospective Analysis (2017-2023)

Sensitivity Analysis
Benchmarking with Similar Companies
(company-specific and industry-trend)

Estimating the Capital and Financial Impacts of

Simulations on Different Hypotheses for the Potential Divestments of Oil & Gas Assets:
Financial Manoeuvre • Drillmec: oil drilling platforms
• Petreven: oil drilling services

Cash Flow Needs Analysis Bonding Lines Needs Analysis

IDENTIFICATION OF POTENTIAL FINANCIAL MANOEUVRE SCENARIOS TO BE SUBMITTED TO DIFFERENT SHAREHOLDERS

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INTRODUCTION TO RESTRUCTURING IV CASE STUDY

Snapshot of the Financial Manoeuvre Implemented as a Result of a Complex

Restructuring Process
The manoeuvre aims to achieve the reprivatisation and restructuring of the Group, estimated between €380m and €430m, based on
GOAL the level of market acceptance of the capital increase

✓ Capital increase through a cash offer for current shareholders amounting to €130m: €77.5m of this is guaranteed by
subscription commitments from institutional shareholders. The remaining portion, if not subscribed in the market option, will be
taken up by credit institutions through the conversion of credits into shares
MAIN ELEMENTS ✓ Conversion of credits into ordinary shares by credit institutions: conversion of €284m at a ratio of 4.5:1
OF ✓ New financing: disbursement of up to €41m, with €12m available during the interim period
THE MANOEUVRE ✓ Bonding lines: availability of approx. €200m, with €30m available in the interim period
✓ Minibond: refinancing and modification of the conditions of the residual bank debt and the bond loan
✓ Issuance of warrants: issuance of €164.8m of European-style warrants for existing shareholders, exercisable in the sixtieth
month, each warrant covering 933 Trevifin shares

Sale of Oil & Gas: divestment of the Drillmec and Petreven divisions to reduce Trevi's debt, with proceeds distributed according to
the following waterfall:
DIVESTMENTS ✓ Repayment of debt-like items (e.g., transaction costs)
AND ✓ Repayment of financial leasing
DEBT REPAYMENT ✓ Repayment of factoring debt for each company
✓ Repayment of derivative debt for each company (subject to Trevifin's assumption)
✓ Repayment of bank debt for each company

EXPECTED Expected financial ratio: the manoeuvre enables achieving a Net Debt/EBITDA and Net Debt/PN ratio of between 2.4-3.2x and 0.8-
RESULTS 1.4x respectively by 2020, depending on market participation

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INTRODUCTION TO RESTRUCTURING IV CASE STUDY

Impacts of the Maneuver on Group's Equity and Net Debt

Consolidated Equity
(€m)
Market 100% Market 0%
Capital Increase – Rights Issue (Cash) 130 77
Capital Increase – Rights Issue (Subscription Consortium) - 53
Subtotal Capital Increase – Rights Issue 130 130
Reserved Capital Increase 63 10
Total Capital Increase 193 140
Increase in Equity from Debt Conversion 221 221
Transaction Write-Off for Settlement and Credit 19 19
Total Equity Recapitalization 434 381
Consolidated Net Debt
Market 100% Market 0%
Estimated Gross Debt @ 31.12.2018 782 782
Conversion (284) (284)
Settlement and Write-Off (28) (28)
Repayment Related to the Divestment of Oil & Gas (97) (97)
New Financing(1) - 38
Pro-Forma Gross Debt @ 31.12.2018 373 411
Cash @ 31.12.2018 (89) (89)
Capital Increase in Cash (130) (77)
Disbursement for Settlement Transaction and Credit Write-Off 8 8
Cash Impact from Divestments of Oil & Gas(2) (4) (4)
New Financing(1) - (38)
Pro-Forma Net Debt @ 31.12.2018 158 211
Net Debt / EBITDA 2018 Pro forma 3.2x 4.2x
Net Debt / EBITDA 2019E 3.6x 4.5x
Net Debt / EBITDA 2020E 2.4x 3.2x
Note: (1) The amount of new financing is reduced by €14m of excess cash from the divestment of Petreven
(2) Includes €14m of proceeds from the divestment of Petreven, net of cash flow from the Oil & Gas division until closing in 2019 (equal to negative €10m) 28
INTRODUCTION TO RESTRUCTURING IV CASE STUDY

Focus on Capital Increase

Capital
• Amount of €130m to be subscribed in cash at €0.0001 per share (approx. 25% TERP discount(1)), offered in option to all shareholders
Increase
• Subscription commitment of €77.5m from institutional shareholders
Rights
• Subscription consortium for conversion of bank credits up to €236m into shares at a 4.5:1 ratio (share value €652.5m)
Issue
Reserved • Reserved capital increase towards banks through conversion of bank credits to TreviFin shares for €284m (adjusted based on consortium conversions in
Capital the capital increase in option) with a conversion ratio of 4.5:1 into ordinary shares, at the option capital increase price
Increase • Total conversion amount of €284.1m regardless of conversions performed by the consortium

(m) Market 100% Market 0% Warrant

As Is Number of shares at Issue 164.8 164.8
• Issuance of European-style
Capital Option Rights 164.8 164.8
warrants for existing Trevi
Increase in Option Ratio (x) 7,889x 7,889x
shareholders, exercisable only at
Option Shares from Option Capital Increase 1,300,000.0 1,300,000.0 60 months
Debt in Conversion 284.1 47.7
Reserved • Total warrants: 164.9, equal to
Conversion Ratio (x) 4.5x 4.5x
Capital the number of shares in
Equity from Conversion 63.1 10.6
Increase circulation
Shares Issued via Reserved Capital Increase 631,372.4 105,939.0
Number of Warrants 164.8 164.8 • Each warrant can subscribe 933
Exercise Ratio (x) 933x 933x compensatory shares at
Warrant-
Shares from Warrant Exercise 153,742.8 153,742.8 €0.00013, with a premium of
Based Capital
Bonus Share Exercise Ratio (x) 0.2x 0.2x 30% on the capital increase
Increase
Maximum Bonus Shares for Warrant Exercise 30,748.6 30,748.6 • If not exercised within 5 years, the
Total Shares from Warrant Exercise 184,491.3 184,491.3 right to 1 extra share every 5
Shareholder Type Shares (#m) Percentage Shares (#m) Percentage subscribed shares
Existing Shares as is 164.8 0.0% 164.8 0.0% • Maximum subscription amount:
Shareholders Shares from Warrants 184,491.3 8.7% 184,491.3 11.6% €20.0m
New Shares from Capital Increase in Option 1,300,000.0 61.4% 1,300,000.0 81.7% • Total shares upon expiry: 184.5m,
Shareholders Shares from Reserved Capital Increase 631,372.4 29.8% 105,939.0 6.7% including bonuses
Total Total Fully Diluted Shares 2,116,028.5 100.0% 1,590,595.1 100.0%

• The discount on TERP obtained in previous capital increases in option conducted in Italy over the last 5 years is above 30%
• As a result, for the current capital increase in option, a TERP discount of 25% applies (considering a share price of €0.26)

Note: (1) Based on a stock price of €0.26 29

INTRODUCTION TO RESTRUCTURING IV CASE STUDY

The Restructuring Process is the Result of a Complex Activity of Aligning the Interests of
Numerous Corporate Stakeholders, in Some Cases with Conflicting Objectives and Interests
The activity of the Chief Restructuring Officer (CRO) and the Group's advisors consists, in summary, of seeking a complex alignment of the interests of numerous
stakeholders through various phases of the debt restructuring process. If a perfect alignment of interests is not possible, the primary objective of the CRO is to
ensure business continuity in compliance with creditor parity and applicable regulations

Financial Creditors
Board of Directors
(and their advisors)

Key Shareholders Providers of New Financing

(and their potential shareholders) (external to current creditors)

CRO and
Parties Interested in Acquiring Advisors Independent Expert
Group Assets / Divisions (e.g. as per art. 57 CCII, former 182bis)
of the
Company

Board of Statutory Auditors Auditing Firm

Clients, Suppliers, and Other Consob, Borsa Italiana, and Other

Operational Stakeholders Bodies

30
INTRODUCTION TO RESTRUCTURING IV CASE STUDY

Focus Areas for the Board of Directors

1 Adequacy of the financial maneuver to restore debt levels in line with other operators in the
sector

2 Ensuring the availability of new financial resources (cash and credit lines)
necessary for the implementation of the industrial plan

3 Maintaining a negotiation approach suited to the status of a listed company,

respecting the interests of all involved stakeholders

Despite the highly dilutive capital increase, the inclusion of additional elements (warrants)
4 could allow, over time and upon the occurrence of certain events, a potential compensation for
existing shareholders

31
CONFIDENTIAL INTRODUCTION TO RESTRUCTURING

Q&A