Euro Disney Affirms July 31, 2004 as Final Approval Date for all Lenders of
Memorandum of Agreement Marne-la-Vallée, June 29, 2004 - Euro Disney S.C.A. announced today that the
requisite number of lenders has approved an extension of the current debt
covenant waivers to July 31, 2004, to allow all of the lenders sufficient time
to review and approve the Memorandum of Agreement ("MOA") that was signed by
the Company, The Walt Disney Company ("TWDC") and Caisse des Dépôts et
Consignations ("CDC") and approved by the Steering Committee of the Company's
other lenders on June 8, 2004.
Under the plan contemplated by the MOA, the Company would obtain liquidity for
sustaining its business as well as capital for investing in new park
attractions as part of its long-term growth strategy.
Subject to final approval by all of the lenders, the terms of the MOA would
provide for: the deferral and subsequent conversion into subordinated long-term
borrowings of both Euro 110 million principal outstanding on the existing line of
credit from TWDC and Euro 58 million of deferred interest payable to the CDC; the
deferral of approximately Euro 300 million of principal payments on senior debt
for 3.5 years; elimination of the Company's current security deposit
requirement in favour of its senior lenders and the disbursement of the current
deposit balance of Euro 100 million as a debt prepayment to such lenders; the
annual deferral of Euro 25 million of management fees and royalties payable to
TWDC for fiscal years 2005 through 2009; and annual conditional deferrals,
based upon the Company's operating results, of up to Euro 25 million of management
fees and royalties payable to TWDC for fiscal years 2007 through 2014, and up
to Euro 22.5 million of CDC loan interest payments for fiscal years 2005 through
2014. The deferrals and conditional deferrals of amounts owed to TWDC and the
CDC cannot be paid earlier than 2017.
In addition, the Company would obtain a new ten-year Euro 150 million line of
credit from TWDC for seasonal liquidity requirements, reducing to Euro 100 million
after five years. The MOA additionally provides for converting Euro 290 million of
payments pursuant to leases from TWDC into a minority equity position in a
subsidiary that would hold substantially all of the Company's assets and
liabilities.
The MOA also provides for a Euro 250 million equity rights offering (*), to which
TWDC has committed to subscribe for Euro100 million with the remainder
underwritten by a group of financial institutions. The MOA would also require
TWDC to beneficially own at least 39% of the issued and outstanding shares of
the Company until December 31, 2016.
The MOA is subject to certain conditions, including: approvals by all of the
lenders by July 31, 2004; regulatory authorisations; approvals of the
reorganisation and the rights offering by the Company's shareholders (which
TWDC has agreed to vote affirmatively); completion of final documentation; and
the successful implementation of the rights offering by no later than March 31,
2005.
In the event that such conditions are not met, and absent a subsequent waiver
or other agreement, TWDC and the Company's lenders would be able to demand
payments for amounts owed, which the Company would not be able to satisfy.
André Lacroix, Chairman and Chief Executive Officer, said: "We are pleased that we can report progress towards the successful resolution
of the Company's financial situation, and now aim for completion of the next
step - the approval by all of the lenders of the Memorandum of Agreement by
July 31, 2004. This next step is required in order to enable us to execute our
strategy of adding exciting new rides and attractions to fuel long-term
growth." Corporate Communication Investor Relations Philippe Marie Sandra Picard-Ramé Tel: +331 64 74 59 50 Tel: +331 64 74 56 28 Fax: +331 64 74 59 69 Fax: +331 64 74 56 36 e-mail:philippe.marie@disney.come-mail:sandra.picard@disney.com See www.eurodisney.com for a copy of the MOA and other Financial Information Code ISIN: FR0000125874 Code Reuters: EDL.PA Sicovam: 12 587 Code Bloomberg: EDL FP Euro Disney S.C.A. and its subsidiaries operate the Disneyland Resort Paris
which includes: Disneyland Park, Walt Disney Studios Park, seven themed hotels
with approximately 5,800 rooms (excluding 1,576 additional third-party rooms
located on the site), two convention centres, Disney Village, a dining,
shopping and entertainment centre, and a 27-hole golf facility. The Group's
operating activities also include the management and development of the
2,000-hectare site, which currently includes approximately 1,000 hectares of
undeveloped land. Euro Disney S.C.A.'s shares trade in Paris (SRD), London and
Brussels.
Management believes certain statements in this press release may constitute
"forward-looking statements" within the meaning of the U.S. Private Securities
Litigation Reform Act of 1995. These statements are made on the basis of
management's views and assumptions regarding future events and business
performance as of the time the statements are made. Actual results may differ
materially from those expressed or implied. Such differences may result from
actions taken by the Company, as well as from developments beyond the Company's
control, including changes in political or economic conditions. Other factors
that may affect results are identified in the Company's documents filed with
the U.S. Securities and Exchange Commission.
(*)An equity rights offering provides existing shareholders with transferable
rights to acquire additional shares at a specified offering price to the extent
of their percentage of ownership. If such rights are not exercised within a
specified time period, then the shares underlying such rights can be offered
for sale at the specified price in the open market.
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