LATAM announces reorganization under Chapter protection 11

LATAM Airlines Group S.A. and its subsidiaries announce the entry into the reorganization processón under protectionón of the Capeíleakage 11 of the USA.

The respective subsidiaries in Chile, Perú, Colombia, Ecuador and the United States began, the dífrom today, un proceso voluntario de reorganizationión and restructuringóyour debt under protectionón of the Capeíleakage 11 from the USA. with the support of the Cueto and Amaro families, y Qatar Airways, two of the group's largest shareholders.

In light of the unprecedented impact that COVID-19 has generated on the global aviation industry,ón, este proceso de reorganizationón provides LATAM with an opportunity to work with the group's creditors, and other interested parties, to reduce your debt and obtain new sources of financing, dágiving you the tools to transform the group according to this new reality.

El proceso de reorganizationófinancial information of the Capíleakage 11 is a legal framework under which LATAM and its subsidiaries canán resize its operations and adapt them to the new demand environment and reorganize its financial balances, allowéndoles re-emerge as businesses más ágiles, resilient and sustainable. LATAM and its subsidiaries continueán flying throughout the process.

The group has secured the financial support of its shareholders, including the Cueto and Amaro families, who have a relationshipón long-standing relationship with the group and Qatar Airways, who will inject USD $900 million in additional financing under a debtor-in-possession structureón (DIP, Debtor in Possession). These partners have a deep understanding of the industry, the group and its challengesíthe operatives. Your support demonstrates your trust in LATAM, its subsidiaries and its long-term sustainability. To the extent permitted by law, the group isá ready to welcome shareholders interested in participating in this process to provide additional financing. Además, at the time of the requestón, the group hasíat approximately USD $1.3 billion available.

LATAM and its subsidiaries alsoén isán holding talks with the respective governments of Chile, Brazil, Colombia y Perú to seek support to access additional financing, protect jobs, to the extent possible and minimize disruptionón of its operations.

The group continueá adaptáing and responding to the COVID-19 pandemic, there it isá actively preparing to welcome customers once travel restrictions are lifted and demand picks up, guaranteeing the más violas isásafety standards for passengers and crewón that characterize LATAM.

LATAM followá flying

how will we remember, weeks agoás, Avianca Holdings realizedó the same ad and this geneó great concernón in airline passengersínea, but it is important to indicate that this process, does not imply a closure or liquidationón of the aerolínea, precisely, seeks to avoid this process.

The LATAM group isá committed to preserving the continuity of your business while you reorganize. Particularly with respect to employees, customers, providers, business partners and the local communities where it operates.

• LATAM Airlines Group S.A. and its subsidiaries continueán operating passenger and cargo flights, subject to demand for their services and travel restrictions.
• be honoredán all current and future passages, así like travel vouchers, miles and frequent flyer benefits and políflexibility ethics.
• Group employees followán receiving their salaries and benefits, themselvesún the ts stipulate itéterms of their employment agreements.
• Suppliers receiveán your payments on time and in due form for all goods and services delivered from the 26 May 2020 on and throughout this process.
• Travel agencies and other business partners will not be seenán affected nor willán disruptions in their interactionón con el grupo LATAM.

Having carefully considered all options, LATAM confíin which the reorganization processón under the Capíleakage 11 is the best way forward to meet the group's objectives, while allowing an administrationón of your fleet and managing your debt, that in its greatestía is located in the United States. It should be noted that this process is completely different from the concept of bankruptcy, bankruptcy or liquidationón. LATAM takes advantage of the protectionón special of this process to pay your employees, fulfill their obligations, pay suppliers crítics and perform any other operationón usual of your business, as the group works with the Court and your creditors to resolve your case. The group's management team will continueá leading LATAM throughés de este proceso de reorganizationón y transformationón, under the protectionón of the Capeíleakage 11.

These provisions únicas del proceso de reorganización of the Capeíleakage 11 to allowán that the group minimizes disruption to the business and protects the interests of interested parties, while restructuring      its financial balance to re-emerge as an Aerol groupíneas más ágil, resilient and sustainable.

Entities included in the request:  

• Chile: LATAM Airlines Group S.A. and some other entities incorporated in Chile areán included in the Cap requestíleakage 11. Spaghettién requestán a recognition process in Chilean courts to ensure that the process under Capíleakage 11 be duly accredited and implemented, which to offerá aún greater protectionón to LATAM businesses.
• Colombia: LATAM Airlines Colombia and other entities incorporated in Colombia areán included in the Cap requestíleakage 11. Spaghettién requestán a recognition process before the Superintendence of Companies of Colombia to ensure that the process under Capíleakage 11 be duly accredited and implemented, which to offerá aún greater protectionón to LATAM businesses.
• Perú: LATAM Airlines Perú and other entities incorporated in Peruú Eastán included in the Cap requestíleakage 11 and alsoéto beán submitting an application for a “Proceso Preventivo de Reorganización” before INDECOPI, to theí ensure that these businesses areén aún más protected from any actionóadverse reaction on the part of creditors.
• Ecuador: LATAM Airlines is Ecuadorá included in Cap's applicationíleakage 11.
• USA: Group operating entities incorporated in the United States, excluding vehiclesíprop assesóspecial sites (“special purpose vehicles”) of the LATAM group isán included in the Cap requestíleakage 11.

Entities not included in the application: 

• Argentina, Brazil and Paraguay: LATAM entities in Argentina, Brazil and Paraguay are notán included in the Cap requestíleakage 11. LATAM entities in Brazil continueútalks with the Brazilian governmentñor regarding the next steps, seeking financial support for the group's operations in Brazil.

It is important to stress that, regardless of whether it isán included in the application or not, all the friendsñíace of the group continueán operating as travel restrictions and demand allow.