Eros Media 26 Regulatory News (ERO1)

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION (EU) 596/2014 AS IT FORMS PART OF UK DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018, AS AMENDED (THE "UK MARKET ABUSE REGULATION").

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO OR TO ANY PERSON LOCATED OR RESIDENT IN ANY JURISDICTION WHERE IT IS UNLAWFUL TO RELEASE, PUBLISH OR DISTRIBUTE THIS ANNOUNCEMENT.

EROS MEDIA WORLD PLC(formerly, EROS STX GLOBAL CORPORATION)

ANNOUNCES REPURCHASE AND CONSENT SOLICITATION IN RESPECT OF ITS£50,000,000 8.50 PER CENT. UNSECURED BONDS DUE 2023

(the "Bonds")(ISIN: XS1112834608)

8 March 2023

Eros Media World PLC (formerly, Eros STX Global Corporation) (incorporated as a limited company and registered in the Isle of Man under the Companies Act 2006 (Isle of Man) with company number 007466V) (the "Company") today announces the launch of (i) a Repurchase and (ii) a Consent Solicitation (each as defined below) in respect of the Bonds on the terms set out in the repurchase and consent solicitation memorandum in respect of the Bonds (the "Repurchase and Consent Solicitation Memorandum") dated today's date and prepared by the Company.

Capitalised terms used but not defined herein shall have the same meanings as in the Repurchase and Consent Solicitation Memorandum.

Details of the Consent Solicitation

The Company has today invited holders of the Bonds:

(a) to offer for repurchase on 15 April 2023 up to £25,000,000 in aggregate nominal amount of the Bonds for cash (the "Repurchase") at the Purchase Price specified below; and

(b) to approve certain modifications (as further described in the Repurchase and Consent Solicitation Memorandum) to (i) the terms and conditions of the Bonds (the "Conditions") contained within the trust deed dated 15 October 2014 as supplemented by a first supplemental trust deed dated 10 April 2017 and a second supplemental trust deed dated 20 September 2021, each between the Company and U.S. Bank Trustees Limited as Trustee (together, the "Trust Deed"), (ii) the Trust Deed and (iii) the agency agreement dated 15 October 2014 made between, inter alios, the Company and the Trustee relating to the Bonds, as previously supplemented by a supplemental agency agreement dated 20 September 2021 between, inter alios, the Company and the Trustee in relation to the Bonds (together the "Agency Agreement"), and the waiver of the breach of certain provisions of the Conditions and of the Trust Deed and any related Event of Default or Potential Event of Default; and to approve the appointment of a new trustee to replace U.S. Bank Trustees Limited as Trustee (and waiver of any actual or potential breach of related provisions of the Trust Deed), all as further described in the Repurchase and Consent Solicitation Memorandum (the "Consent Solicitation", and together with the Repurchase, each an "Invitation" and together the "Invitations") for approval by Extraordinary Resolution at a meeting of Bondholders (such meeting being the "Meeting").

This announcement does not contain details of the full terms and conditions of the Repurchase and the Consent Solicitation, which are contained in the Repurchase and Consent Solicitation Memorandum. Holders of the Bonds may obtain a copy of the Repurchase and Consent Solicitation Memorandum from Kroll Issuer Services Limited, who is acting as Tender, Tabulation and Information Agent in connection with the Repurchase and the Consent Solicitation and whose contact details are set out at the end of this announcement.

Holders of the Bonds are advised to carefully read the Repurchase and Consent Solicitation Memorandum and are reminded that the below is a summary only of the terms of the Consent Solicitation.

Details of the Bonds

1 For the avoidance of doubt, all Bondholders (including any Bondholders whose Bonds are accepted for repurchase in the Repurchase) shall receive the interest payment falling to be paid on 17 April 2023 (15 April 2023 being a Saturday).

2 Bondholders whose Bonds are accepted for repurchase in the Repurchase will receive the Purchase Price but will not receive any interest for the period from (and including) 15 April 2023 to the Payment Date (which is expected to be no later than 21 April 2023). 

3 Bondholders who submit (and do not revoke) either (i) valid Repurchase Instructions, or (ii) valid Voting Instructions (voting for the Extraordinary Resolution), in each case which are received by the Tender, Tabulation and Information Agent on or before the Final Deadline, will be eligible to receive the Consent Fee if the Extraordinary Resolution is passed and the Proposals are implemented.

The Meeting

A notice (the "Notice") convening the Meeting to be held at 10.00 a.m. (London time) on 30 March 2023 via teleconference has been given to Bondholders in accordance with the Trust Deed on the date of this announcement. At the Meeting, Bondholders will be invited to consider and, if thought fit, pass an extraordinary resolution (the "Extraordinary Resolution") to approve the Proposals as more fully described in the Notice.

The quorum required for the Meeting is two or more persons present holding or representing not less than 75 per cent. in aggregate nominal amount of the Bonds for the time being outstanding. To be passed, the Extraordinary Resolution requires a majority in favour of at least 75 per cent. of the votes cast in respect of the Extraordinary Resolution at the Meeting. If passed, the Extraordinary Resolution shall be binding on all Bondholders, whether present or not present at the Meeting and whether or not voting.

The implementation of the Extraordinary Resolution, if passed, is conditional on the Company not having previously terminated the Consent Solicitation in accordance with the provisions for such termination set out in the Repurchase and Consent Solicitation Memorandum under the heading "Amendment and Termination".

Under the Trust Deed, subject to all other provisions therein, the Trustee may prescribe such further regulations regarding the holding of meetings of Bondholders and attendance and voting at them as the Trustee may in its sole discretion determine. For the purpose of the Meeting, the Trustee has prescribed certain virtual meeting guidelines and regulations.

The Meeting will be held via teleconference using a platform hosted by the chairman of the Meeting to allow attendees to participate electronically. Details for accessing the Meeting (or any adjourned Meeting) will be made available to proxies who have been duly appointed under a block voting instruction, or to holders of voting certificates issued, in accordance with the procedures set out in the Repurchase and Consent Solicitation Memorandum. Such proxies and holders of voting certificates will be contacted by the Tender, Tabulation and Information Agent (whose contact details are set out in the Repurchase and Consent Solicitation Memorandum) at least 24 hours before the Meeting in order to ensure that they are provided with the necessary information for attending and communicating their votes during the Meeting via teleconference.

Participating in the Repurchase

To participate in the Repurchase, a holder of the Bonds should deliver, or arrange to have delivered on its behalf, via the relevant Clearing System and in accordance with the requirements of such Clearing System, a valid Repurchase Instruction to be received by the Tender, Tabulation and Information Agent by 4.00 p.m. (London time) on 27 March 2023 (the "Final Deadline").

By participating in the Repurchase through the submission of valid Repurchase Instructions at or prior to the Final Deadline, such Bondholders will automatically instruct the Tender, Tabulation and Information Agent to arrange for the appointment of one or more representatives of the Tender, Tabulation and Information Agent as a proxy to vote in favour of the Extraordinary Resolution at the Meeting (or any adjourned Meeting).

Bondholders who submit (and do not validly revoke) Repurchase Instructions before the Final Deadline will be deemed to have voted in favour of the Extraordinary Resolution, and accordingly will be eligible to receive the Consent Fee (as defined herein) (even if not all of the Bonds in respect of which a Repurchase Instruction is given are accepted for repurchase by the Company). It is not possible to submit a Repurchase Instruction and vote against the Extraordinary Resolution.

The Company will not accept offers of Bonds for repurchase (or pay the Consent Fee) if the Extraordinary Resolution is not passed and the Proposals are not implemented.

The Company proposes to repurchase in cash up to £25,000,000 in aggregate nominal amount of Bonds offered for repurchase in the Repurchase. As at the date of this announcement, the Company expects to repurchase not less than £15,000,000 in aggregate nominal amount of the Bonds, but the Company reserves the right to determine, in its sole discretion, the aggregate nominal of Bonds to be repurchased depending on (among other things) the aggregate nominal amount of the Bonds that are offered for repurchase. The Company shall give notice of the aggregate nominal amount of the Bonds to be repurchased (the "Repurchase Total") as soon as practicable after the Final Deadline. If the aggregate nominal amount of Bonds offered for repurchase is greater than the Repurchase Total, the Company shall scale back all acceptances received on a pro rata basis.

Participating in the Consent Solicitation

To participate in the Consent Solicitation, a holder of the Bonds should deliver, or arrange to have delivered on its behalf, via the relevant Clearing System and in accordance with the requirements of such Clearing System, a valid Voting Instruction, to be received by the Tender, Tabulation and Information Agent by the Final Deadline.

Any Bondholder may be eligible, on the terms and conditions set out in the Repurchase and Consent Solicitation Memorandum, to the extent permitted by applicable laws and regulations, to receive an amount of £0.50 per £100 in nominal amount of the Bonds in respect of which the relevant Bondholder submits a Voting Instruction voting for the Extraordinary Resolution in accordance with the procedure described below and in the Repurchase and Consent Solicitation Memorandum (the "Consent Fee").

To be eligible for the Consent Fee, such Voting Instructions must be received by the Tender, Tabulation and Information Agent from Bondholders on or before the Final Deadline. Voting Instructions must be submitted in respect of a minimum principal amount of the Bonds of no less than £100, being the minimum denomination of the Bonds.

Holders of the Bonds that do not deliver a Repurchase Instruction or Voting Instruction in accordance with the preceding paragraphs, but who wish to attend and vote at the Meeting in person or to be represented or otherwise to vote at the Meeting, must make the necessary arrangements in accordance with the Notice and the Meeting Provisions (as defined in the Repurchase and Consent Solicitation Memorandum) by the Final Deadline. Such holders will not be eligible to receive the Consent Fee.

Payment of the Consent Fee is subject to (i) the delivery of a valid Voting Instruction in respect of the Extraordinary Resolution to the Tender, Tabulation and Information Agent on or before the Final Deadline, (ii) such Voting Instruction not being revoked (in the limited circumstances in which such revocation is permitted described in "Amendment and Termination - Consent Solicitation Revocation Rights" in the Repurchase and Consent Solicitation Memorandum), (iii) the Extraordinary Resolution being duly passed and the Proposals implemented and (iv) the Company not having previously terminated the Consent Solicitation or the Proposals in accordance with the provisions for such termination set out in "Amendment and Termination" in the Repurchase and Consent Solicitation Memorandum.

Repurchase Instructions and Voting Instructions will be irrevocable except in the limited circumstances described in the Repurchase and Consent Solicitation Memorandum under the heading "Amendment and Termination".

Indicative timetable for the Offers

Set out below are the indicative timetables applicable to the Repurchase and the Consent Solicitation. The Principal Timetable applies where the Meeting is quorate on the date on which it is first held, and the Alternative Timetable applies where the Meeting is not quorate on the date on which it is first held and is therefore adjourned. Bondholders should note that these timetables will depend, among other things, on timely receipt (and non-revocation) of instructions, the right of the Company to extend, re-open, amend and/or terminate the Repurchase or the Consent Solicitation (other than the terms of the Extraordinary Resolution) as described in the Repurchase and Consent Solicitation Memorandum not being exercised, and the passing of the Extraordinary Resolution at either the first Meeting or (if applicable) any adjourned Meeting. Accordingly, the actual timetable may differ significantly from either of the timetables below.

Principal Timetable

The following timetable assumes that the Meeting is quorate on the date on which it is first held.

Alternative Timetable

The following table sets out the timetable as from 30 March 2023 if the Meeting is not quorate on the date on which it is first held and, accordingly, it is adjourned.

Bondholders are advised to check with any bank, securities broker or other intermediary or nominee institution (including through CDIs in CREST) through which they hold Bonds whether such intermediary would require to receive instructions to participate in the Consent Solicitation before the deadlines specified above. The deadlines set by any such nominee, CREST and each Clearing System for the submission of Repurchase Instructions or Voting Instructions will also be earlier than the relevant deadlines above.

Rationale for and background to the Repurchase and the Consent Solicitation

On 20 September 2021, the Company (then known as Eros STX Global Corporation) obtained consent from the requisite majority of Bondholders to extend the maturity date of the Bonds to 15 April 2023, in order to give the Company sufficient time to access additional liquidity to fund its operations and to allow it to continue trading as a going concern while its film business, particularly in India, recovered from the COVID-19 pandemic. The Company also obtained Bondholder consent to certain other waivers, including in relation to the timing of provision to the Trustee of copies of its annual financial statements for the year ended 31 March 2021 and financial statements for the six months ended 30 September 2021. As part of the consent process, the rate of interest on the Bonds was increased from 6.50 per cent. per annum to 8.50 per cent. per annum.

On 7 December 2021, the Company entered into a definitive agreement to sell its STX Entertainment subsidiary ("STX Entertainment") to an affiliate of The Najafi Companies ("Najafi"), with Najafi acquiring all issued and outstanding shares of common stock of a parent entity of STX Entertainment and repaying an outstanding senior credit facility of STX Entertainment (the "Senior Credit Facility"). The sale of STX Entertainment to Najafi and repayment of the Senior Credit Facility and other subordinated credit facilities were completed on 25 April 2022. Following the sale of STX Entertainment, the Company was renamed "Eros Media World PLC" on 25 May 2022.

The sale of STX Entertainment was necessary to enable the Company to pursue its long-term strategy and to maximise long-term value for its shareholders, but it has left a legacy of complex financial reporting and other transition issues. While the Company has been diligently working to address such issues, the remaining transition and financial reporting issues have caused a delay in the Company's timely filing of annual and semi-annual reports and other reporting obligations. This has also had a significant impact on the financial position of the Company, which the Company has been working hard to improve ever since.

Ongoing impact of the COVID-19 outbreak on the Company

The COVID-19 outbreak caused significant disruptions to the Company's global operations by restraining the production and distribution of film content, particularly in the Company's primary market of India. The pandemic affected how film content was distributed to various distribution channels due to the closure of cinemas in the United States, India and international territories. There was, however, an increase in streaming and digital licensing revenue for the Company's films due to the closure of cinemas.

As measures to mitigate the spread of COVID-19 have eased or been removed in most countries, the Company is working on a business transformation, recognising the growth in digital businesses driven by the pandemic and emergence of technologies such as blockchain and non-fungible tokens ("NFT"). The number of online video users in India has grown to over 500 million users in 2022, with a 52 per cent. increase in time spent as compared to pre-pandemic levels. Going forward, the Company will be focused on leveraging the value of its content library (one of the world's largest Indian language film libraries with over 3,000 titles), monetising the library to meet the demand for content across streamers, cable and satellite companies and resurgent theatrical window in India. The Company will also continue to focus on direct-to-customer relationships through its Eros Now streaming platform, with a view of improving overall penetration and distribution of Eros Now as a service to further regions in India, and migrating existing subscribers to higher average revenue per user (ARPU) plans. This business transformation will take time to implement fully.

Rationale for the Invitations

As part of the Company's efforts to optimise its debt structure and cost of capital, the Company is offering to repurchase for cash up to £25,000,000 nominal amount of Bonds at the Purchase Price on 15 April 2023 as further described below, using cash made available from the realisation of contracted receivables due from the Company's subsidiaries.

The Company is also inviting Bondholders to approve (1) the Company making certain modifications to (i) the terms and conditions of the Bonds (the "Conditions") contained within the Trust Deed, (ii) the Trust Deed and (iii) the Agency Agreement, (2) the waiver of the breach of certain provisions of the Conditions and of the Trust Deed and any related Event of Default or Potential Event of Default and (3) the appointment of a new trust corporation to replace U.S. Bank Trustees Limited as Trustee (and waiver of any actual or potential breach of related provisions of the Trust Deed).

The Company is offering the Consent Fee to any Bondholder that either (i) offers its Bonds for repurchase in the Repurchase (even if not all of the Bonds in respect of which a Repurchase Instruction is given are accepted for repurchase by the Company), or (ii) votes in favour of the Extraordinary Resolution in the Consent Solicitation. Bondholders who vote against the Extraordinary Resolution, or abstain from voting on the Extraordinary Resolution, or fail to submit Repurchase Instructions or Voting Instructions, or who submit but then validly revoke Repurchase Instructions or Voting Instructions, will not be eligible to receive the Consent Fee. The Consent Fee will only be payable if the Extraordinary Resolution is passed and the Proposals are implemented.

1. Extension of the maturity of the Bonds and increase in rate of interest payable on the Bonds

The Company is proposing to extend the maturity of the Bonds to enable it to access the liquidity that is required to fund its operations and allow it to continue its business transformation following the COVID-19 pandemic and the sale of STX Entertainment.

The Company is also offering an increase in the rate of interest payable on the Bonds from 8.50 per cent. to 9.00 per cent. per annum.

2. Introduction of new covenant restricting Eros International Media Limited (India) from incurring or maintaining indebtedness in excess of the Debt Limit

The Company is proposing the introduction of an additional covenant restricting Eros International Media Limited (India), one of its biggest subsidiaries, from, for so long as any Bonds remaining outstanding, having indebtedness outstanding in excess of the Debt Limit. The "Debt Limit" means (i) in the period from (and including) 15 April 2023 to (but excluding) 31 March 2024, £40,000,000; and (ii) at any time on or after 31 March 2024, £15,000,000.

3. Waiver of requirement to provide financial statements for the year ended 31 March 2022 by 31 July 2022, to provide financial statements for the six months ended 30 September 2022 by 30 November 2022, to provide financial statements for the year ended 31 March 2023 by 31 July 2023 and to provide financial statements for the six months ended 30 September 2023 by 30 November 2023

The Company is proposing a waiver of:

1) any Event of Default resulting from the failure to provide to the Trustee copies of:

a) its annual financial statements for the year ended 31 March 2023 (the "2023 Audited Financial Statements") within four months after the end of its financial year (i.e. by 31 July 2023); and

b) its financial statements for the six months ended 30 September 2023 (the "H1 2024 Financial Statements") within two months after 30 September 2023 (i.e. by 30 November 2023),

as well as

2) any prior or ongoing Event of Default resulting from its failure to complete and provide the Trustee with (a) its 2021 Audited Financial Statements by 31 July 2021, (b) its H1 2022 Financial Statements by 30 November 2021, (c) its annual financial statements for the year ended 31 March 2022 (the "2022 Audited Financial Statements") by 31 July 2022, and (d) its financial statements for the six months ended 30 September 2022 (the "H1 2023 Financial Statements") by 30 November 2022,

provided that copies of the 2021 Audited Financial Statements, the 2022 Audited Financial Statements, the 2023 Audited Financial Statements and the H1 2024 Financial Statements are furnished to the Trustee by 30 June 2023, 30 September 2023, 31 December 2023 and 31 March 2024, respectively (each, a "Relevant Deadline").

The Company's financial year ends on 31 March in each year. The terms and conditions of the Bonds require the Company to deliver to the Trustee copies of (i) its annual financial statements within four months after the end of the financial year, i.e. by 31 July in each year, and (ii) its interim financial statements for the six months ended 30 September in each year within 2 months after that date, i.e. by 30 November in each year.

The Company had previously not satisfied (and had received a waiver from the Bondholders from satisfying) this requirement in respect of its 2021 Audited Financial Statements and its H1 2022 Financial Statements.

The Company announced on 25 April 2022 that it has completed the sale of STX Entertainment, which has resulted in complex financial reporting and transition issues, leading to a delay in completing its financial audits. The Company has worked diligently to resolve such issues, and has engaged with its new auditors to complete and publish the 2022 Audited Financial Statements as soon as practicable. This may also impact on the Company's ability to complete and provide the Trustee with the 2023 Audited Financial Statements by the deadline imposed by the terms and conditions of the Bonds.

The Company is therefore proposing a waiver of any Event of Default resulting from the failure to provide copies of the 2023 Audited Financial Statements and the H1 2024 Financial Statements by the deadlines specified above, as well as any prior or ongoing Event of Default resulting from its failure to provide the Trustee with the 2021 Audited Financial Statements, the H1 2022 Financial Statements, the 2022 Audited Financial Statements and the H1 2023 Financial Statements, provided that copies of the 2021 Audited Financial Statements, the 2022 Audited Financial Statements, the 2023 Audited Financial Statements and the H1 2024 Financial Statements are provided to the Trustee by the Relevant Deadline. The Company does not currently publish any other interim financial statements.

4. Waiver of an Event of Default relating to the Company's failure to add its Subsidiary, Eros Worldwide FZE, as a Subsidiary Guarantor in respect of the Bonds in accordance with the requirements of the Conditions (provided that it is added as a Subsidiary Guarantor by no later than 30 June 2024)

The Company is also proposing a waiver of any Event of Default under Condition 8(b) (Breach of Other Obligations), and any related breach of the Trust Deed, arising as a result of its failure to add its Subsidiary, Eros Worldwide FZE, as a Subsidiary Guarantor in accordance with the requirements of the Trust Deed and Condition 2(c) (Addition of Subsidiary Guarantors).

Condition 2(c) requires, in summary, that a Subsidiary of the Company which becomes a borrower, or provides a guarantee or indemnity in respect of, certain indebtedness must unconditionally and irrevocably guarantee, on a joint and several basis, the due payment of all sums expressed to be payable by the Company under the Trust Deed, the Bonds and the Coupons.

The Company, together with its Subsidiaries Eros Network Limited and Eros International USA Inc., has been a guarantor under an overdraft facility provided by the Bank of India (the "Bank of India Facility") to its Subsidiary Eros International Limited since before the Bonds were first issued. In May 2020, the Company's Subsidiary, Eros Worldwide FZE, was added as a guarantor in respect of the Bank of India Facility. At that point in time the Company was very busy dealing with the merger of STX Entertainment and inadvertently failed to comply with its obligation to add this Subsidiary as a Subsidiary Guarantor, or to notify the Trustee of the same, as required by Condition 2(c) (Addition of Subsidiary Guarantors). The Company is now proposing to add this Subsidiary as a Subsidiary Guarantor, pursuant to and as required by Condition 2(c) (Addition of Subsidiary Guarantors), by no later than 30 June 2023, and accordingly is proposing a waiver of any Event of Default under Condition 8(b) (Breach of Other Obligations), and any related breach of the Trust Deed, for having failed to do so previously (including its failure to notify the Trustee of the same), provided that this Subsidiary is added as a Subsidiary Guarantor, pursuant to and as required by Condition 2(c) (Addition of Subsidiary Guarantors), by no later than 30 June 2023.

5. Waiver of an Event of Default and a Potential Event of Default in connection with a default under a Subsidiary's financing agreement

The Company is also proposing a waiver of an Event of Default under Condition 8(c) (Cross-Default), as well as any Events of Default under Conditions 8(d) (Enforcement Proceedings) and 8(e) (Security Enforced), and any related breach of the Trust Deed, in each case arising (or which may arise) as a result of a repayment default in respect of the Bank of India Facility.

On 15 February 2023, Eros International Limited entered into administration following a repayment default under the Bank of India Facility. While this repayment default and administration has triggered a cross-default scenario under Condition 8(c) and a Potential Event of Default under Conditions 8(d) and 8(e), the Company and Eros International Limited are actively working with the relevant parties to remedy this Event of Default and to ensure that the Potential Events of Default do not become Events of Default. The Company will give notice to Bondholders as soon as practicable after agreement has been reached with the relevant parties (both to reschedule the Bank of India Facility, and to return the control of Eros International Limited to its board of directors). Accordingly, in order to give the Company time to remedy these matters the Company is proposing a waiver of an Event of Default under Condition 8(c) (Cross-default), as well as any Event of Default that has arisen or may arise under Conditions 8(d) (Enforcement Proceedings) and 8(e) (Security Enforced), and any related breach of the Trust Deed, as a result of the relevant repayment default.

6. Waiver of breach of financial covenants

The Company is also proposing a continued waiver of the requirement to comply with the covenants set out in Condition 3(b) (Financial Covenant (Leverage Ratio)) and Condition 3(c) (Financial Covenant (Fixed Charge Cover Ratio)) (together, the "Financial Covenants") until 31 March 2024.

Due to the continued delay in finalisation of the 2021 Audited Financial Statements and the 2022 Audited Financial Statements as well as the expected delay in the finalisation of the 2023 Audited Financial Statements, as described above, the Company is currently unable to confirm compliance with the Financial Covenants. Furthermore, due to the impact of the COVID-19 pandemic and the sale of STX Entertainment on the restatement of the Company's financials and the Company's financial position, the Company anticipates that, even if it were able to test compliance with the Financial Covenants upon the publication of the 2022 Audited Financial Statements or the 2023 Audited Financial Statements, it would be in breach of the Financial Covenants when the 2022 Audited Financial Statements or the 2023 Audited Financial Statements are published. The Company anticipates that it may be unable to comply with the Financial Covenants until the publication of the Company's 2024 Audited Financial Statements.

Accordingly, the Company is proposing a waiver of any breach of the Financial Covenants (and any resultant Event of Default or Potential Event of Default) until 31 March 2024.

7. Replacement of Trustee

In light of a change in business operations within the Trustee, the Trustee has informed the Company of its wish to resign as Trustee for the Bonds. The Company is currently in the process of onboarding and appointing a replacement trustee, which is expected to occur on or before 15 April 2023. Accordingly, the Company is seeking the approval of Bondholders to the appointment of a trustee corporation to replace U.S. Bank Trustees Limited as trustee for the Bondholders. As the appointment process is ongoing as at the date of this Repurchase and Consent Solicitation Memorandum and is not expected to be completed until after the Meeting, the Company is unable to confirm to the Bondholders of the identity of the replacement trustee at this time. As such, the Company is also seeking a waiver of any actual or potential breach of Clause 14.1 of the Trust Deed relating to Bondholders approving the appointment of a specific new trustee. The Company will give notice to Bondholders of the formal appointment of the replacement trustee in accordance with the provisions of the Trust Deed.

Other Developments

Undertaking to create security

To enhance value for Bondholders, the Company is proposing, as a separate and ancillary matter (not forming part of the Proposals) that it will, by no later than 30 June 2023 (the "Security Deadline"), procure the creation of security (the "Security") over certain intellectual property and other intangible rights (the "Secured Assets") described in the Repurchase and Consent Solicitation Memorandum and held by its wholly-owned subsidiary, Eros Worldwide FZE, for the benefit of the Trustee (acting as security trustee) on behalf of the Bondholders. Once created, the Security will remain in place for so long as any Bond remains outstanding, save that the Company (or Eros Worldwide FZE) shall be permitted to dispose of all or any part of the Secured Assets (and release the Security accordingly) provided that at least 50% of the net proceeds of any such disposal are used to repay the Bonds (either in full or in part, as the case may be).

The Company is working with its advisers to make arrangements for the creation of the Security by no later than the Security Deadline, and will give notice to the Bondholders by RNS and by delivery of a notice to the Clearing Systems once the Security has been created.

General

Details of how to participate in the Repurchase and the Consent Solicitation are set out in the Repurchase and Consent Solicitation Memorandum. Bondholders may obtain a copy of the Repurchase and Consent Solicitation Memorandum by contacting the Tender, Tabulation and Information Agent, the contact details of whom are set out below.

Notices throughout the Repurchase and Consent Solicitation will be published in accordance with the Trust Deed and all applicable rules and regulations as follows:

(a) a notice in Euroclear Bank SA/NV and Clearstream Banking S.A. for communication to Direct Participants; and/or

(b) an announcement released on the RNS service of the London Stock Exchange, and by any other means as the Company may, in its absolute discretion, consider appropriate.

Disclaimer

The Repurchase and Consent Solicitation Memorandum contains important information which should be read carefully before any decision is made in respect of the Offers.

If you are in any doubt as to the action you should take, you are recommended to seek your own financial advice, including in respect of tax consequences, immediately from your stockbroker, bank manager, solicitor, accountant or other independent financial adviser authorised under the Financial Services and Markets Act 2000 as amended (if you are in the United Kingdom) or from another appropriately authorised independent adviser (if you are not).

Before making a decision with respect to the Repurchase and/or the Consent Solicitation, Bondholders should carefully consider all of the information in the Repurchase and Consent Solicitation Memorandum and, in particular, the risk factors described therein.

No person is authorised in connection with the Repurchase or the Consent Solicitation to give any information or to make any representation not contained in the Repurchase and Consent Solicitation Memorandum, and any such information or representation must not be relied on as having been authorised by or on behalf of the Company, the Trustee, the Tender, Tabulation and Information Agent or the Principal Paying Agent or any of their respective affiliates. None of the Tender, Tabulation and Information Agent, the Trustee or the Principal Paying Agent or their respective affiliates has separately verified the information contained herein. Accordingly, no representation, warranty or undertaking, express or implied, is made and no responsibility nor liability is accepted by the Trustee, the Tender, Tabulation and Information Agent or the Principal Paying Agent or any of their respective affiliates as to the accuracy or completeness of the information contained in the Repurchase and Consent Solicitation Memorandum or any other information provided by it in connection with the Repurchase and/or the Consent Solicitation.

The Company has retained Kroll Issuer Services Limited to serve as Tender, Tabulation and Information Agent with respect to the Repurchase and the Consent Solicitation. At any time, the Tabulation Agent may trade Bonds for their own accounts or for the accounts of customers and, accordingly, may have a long or short position in the Bonds.

None of the Trustee, the Tender, Tabulation and Information Agent or the Principal Paying Agent or any of their respective directors, employees and affiliates assume any responsibility for the accuracy or completeness of the information concerning the Repurchase, the Consent Solicitation, the Extraordinary Resolution, the Company or any of its affiliates or the Bonds in the Repurchase and Consent Solicitation Memorandum or for any failure by any of them to disclose events that may have occurred and may affect the significance or accuracy of such information and the terms of any amendment to the Repurchase and/or the Consent Solicitation.

None of the Company, the Trustee, the Tender, Tabulation and Information Agent, the Principal Paying Agent or any director, officer, employee, agent or affiliate of any such persons are acting for any Bondholder, or will be responsible to any Bondholder for providing any protections which would be afforded to its clients or for providing advice in relation to the Repurchase, the Consent Solicitation or the Extraordinary Resolution, and accordingly none of the Company, the Trustee, the Tender, Tabulation and Information Agent, the Principal Paying Agent or any director, officer, employee, agent or affiliate of any such persons, make any recommendation whether Bondholders should participate in the Repurchase or the Consent Solicitation or otherwise participate at any Meeting and none of the Trustee, the Tender, Tabulation and Information Agent, the Principal Paying Agent or any director, officer, employee, agent or affiliate of any such persons, make any representation whatsoever regarding the Repurchase or the Consent Solicitation.

The distribution of the Repurchase and Consent Solicitation Memorandum in certain jurisdictions may be restricted by law. Persons into whose possession the Repurchase and Consent Solicitation Memorandum comes must inform themselves about and observe any such restrictions.

Questions and requests for assistance in connection with the Consent Solicitation may be directed to the Company:

Questions and requests for assistance in connection with the delivery of Repurchase Instructions or Voting Instructions may be directed to the Tender, Tabulation and Information Agent:

This announcement is released by Eros Media World PLC and contains inside information for the purposes of Article 7 of the UK Market Abuse Regulation, encompassing information relating to the Repurchase and the Consent Solicitation described above. For the purposes of the UK Market Abuse Regulation, this announcement is made by the Investor Relations team at Eros Media World PLC.