LyondellBasell Reorganization Plan Confirmed by Bankruptcy Court

The United States Bankruptcy Court for the Southern District of New York confirmed LyondellBasell’s Plan of Reorganization on April 23, 2010. The Plan received broad-based support from virtually all creditor classes entitled to vote on the Plan. LyondellBasell affiliates currently in voluntary reorganization are projected to emerge from Chapter 11 protection on April 30, 2010.

"We are extremely proud to announce that in the short period of 15 months, LyondellBasell is poised to exit from Chapter 11," said Jim Gallogly, LyondellBasell’s Chief Executive Officer. "We are equally grateful to our creditors for the confidence they have expressed in our reorganization by voting overwhelmingly to support our plan, and to our customers and our suppliers for their support during this unprecedented period in our history.

"We emerge from Chapter 11 as a stronger company and business partner. Our industry-defining technologies, global reach and focus on operational excellence will provide LyondellBasell with a bright future," Gallogly said. "Through this reorganization we have solidly positioned the company to be an industry leader with a significantly improved balance sheet, excellent liquidity, a more efficient organizational structure, and a new management team."

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Sound Capitalization and Lower Debt
In conjunction with the emergence from Chapter 11, LyondellBasell raised $3.25 billion of first priority debt, including $2.25 billion and €375 million offerings of senior secured notes in a private placement and borrowings of $500 million under a senior term loan facility as part of its exit financing. The net proceeds from the sale of the notes, together with borrowings under the term loan, a new European securitization facility, and proceeds from a $2.8 billion rights offering, will be used to repay and replace certain existing debt, including debtor-in-possession credit facilities and an existing European securitization facility, and to make certain related payments.

Upon emergence from Chapter 11, the company expects to have approximately $7.2 billion of total consolidated debt and approximately $5.2 billion of net consolidated debt, including approximately $2 billion of cash and cash equivalents. There will also be approximately $2.4 billion of lending commitments under an asset backed lending facility in the U.S.and a European revolving trade accounts receivable securitization, of which approximately $1 billion will be undrawn at emergence. When LyondellBasell filed for Chapter 11, it had consolidated debt of approximately $24 billion.

"Our reorganization plan significantly de-levers our capital structure," Gallogly said.

New Publicly Traded Parent Company
As part of the reorganization a new parent holding company was formed, LyondellBasell Industries N.V., a public limited liability company incorporated in the Netherlands. LyondellBasell Industries AF S.C.A., a Luxembourg company which was the former parent holding company, will no longer be a part of LyondellBasell. LyondellBasell’s corporate seat will be Rotterdam, Netherlands, with administrative offices in Houston and Rotterdam.

LyondellBasell is arranging for the stock of the new parent company to be publicly traded on the New York Stock Exchange. The listing is currently projected for the third quarter 2010. Approximately 563.9 million shares of common stock will be issued under the Plan. This includes 300 million shares of Class A new common stock issued in exchange for allowed claims under the Plan. Approximately 263.9 million shares of Class B stock are being issued in connection with the rights offering.

Plan Distributions
Under the Plan, administrative and priority claims, as well as the new money debtor-in-possession (DIP) financing will receive payment in full. DIP roll-up lenders will be issued new notes in the same principal amount. Holders of senior secured claims will receive approximately 93 percent of the Class A shares of the new holding company in exchange for their claims. Most allowed general unsecured claims will receive a pro-rata distribution of cash and Class A shares under the terms of a settlement among LyondellBasell and its creditor constituencies. Holders of subordinated claims, securities claims and equity claims will not receive or retain any interest or property under the Plan of Reorganization.

The organizational structure of the company in North America will be simplified by the removal of 90 legal entities. The ultimate ownership of 49 of these entities (identified as Schedule III Debtors in the Plan) will be transferred to a new owner, the Millennium Custodial Trust, a trust established for the benefit of certain creditors, and these entities will no longer be part of LyondellBasell. In addition, certain real properties owned by the Debtors, including the Schedule III Debtors, will be transferred to the Environmental Custodial Trust which will own and remediate these properties. Any associated liabilities of the entities transferred to and ultimately owned by the Millennium Custodial Trust will be the responsibility of those entities and claims regarding those entities will be resolved solely using their assets and the assets of the trust. In total, $250 million of cash will be used to fund the two trusts, including approximately $80 million to the Millennium Custodial Trust and approximately $170 million to fund the Environmental Custodial Trust and to make certain direct payments to the Environmental Protection Agency and certain state environmental agencies.

Industry-Leading Company
LyondellBasell is the world’s third-largest independent chemical company with 2009 sales of $30.8 billion. The company manufactures products at 59 sites in 18 countries, including joint ventures. Approximately 54 percent of 2009 revenues were generated from sales in North America, 35 percent from sales in Europe and 11 percent from sales in the rest of the world. Key uses for LyondellBasell’s products include rigid and flexible packaging, transportation fuels, containers, plastic pipe, detergents, cosmetics, electronics, appliances, automotive parts, paints and coatings, furnishings, construction and building materials and other industrial and consumer goods applications.

LyondellBasell voluntarily filed to reorganize its U.S. operations and one of its European holding companies under Chapter 11 of the U.S. Bankruptcy Code on Jan. 6, 2009, in order to restructure the company’s debts. Additionally, LyondellBasell’s parent company and its general partner were voluntarily added to the Chapter 11 reorganization filing on April 24, 2009 to protect the holding companies against claims by certain financial and U.S. trade creditors. The company added 13 non-operating entities to the reorganization filing on May 8, 2009 for administrative purposes. The bankruptcy cases are being administered in the Southern District of New York in Manhattan.

More Information: www.lyondellbasell.com

LyondellBasell, Rotterdam, Netherlands

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