As previously disclosed, on June 15, 2022, Revlon, Inc. (“Revlon”) and certain subsidiaries, including Revlon Consumer Products Corporation (“Products Corporation” and together with Revlon, the “Company”) (the Chapter 11 filing entities collectively, the “Debtors”), filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code (the “Bankruptcy Code”) in the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”). The cases (the “Chapter 11 Cases”) are being administered under the caption In re Revlon, Inc., et al. (Case No. 22-10760 (DSJ)). The Debtors continue to operate their businesses as “debtors-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and orders of the Bankruptcy Court.

Also, as previously disclosed, on December 19, 2022, Revlon, Products Corporation, and certain of Revlon’s other direct and indirect subsidiaries entered into a Restructuring Support Agreement (the “RSA”) with certain of the Company’s prepetition lenders under the previously disclosed 2020 BrandCo Credit Agreement and the Official Committee of Unsecured Creditors in the Debtors’ Chapter 11 Cases regarding restructuring transactions (such transactions, collectively, the “Restructuring”) pursuant to a Chapter 11 plan of reorganization on the terms and conditions set forth in the RSA.

Also, as previously disclosed, on December 22, 2022, the Debtors filed a proposed Joint Chapter 11 Plan of Reorganization of the Debtors (the “Proposed Plan”) and a related proposed form of Disclosure Statement (the “Proposed Disclosure Statement”) with the Bankruptcy Court. The Proposed Plan is intended to implement the previously disclosed Restructuring contemplated by the RSA. The Proposed Plan and the related Proposed Disclosure Statement describe, among other things, the Proposed Plan; the Restructuring contemplated by the RSA; the events leading to the Chapter 11 Cases; certain events that have occurred or are anticipated to occur during the Chapter 11 Cases, including the anticipated solicitation of votes to approve the Proposed Plan from certain of the Debtors’ creditors and certain other aspects of the Restructuring.

Backstop Commitment Agreement

Pursuant to the RSA and the Proposed Plan, the Debtors shall conduct an equity rights offering (the “Equity Rights Offering”) at an aggregate amount of $650 million (the “Aggregate Rights Offering Amount”), subject to the Excess Liquidity Cutback (as defined below), at a 30% discount to Plan Equity Value (as defined in the Proposed Plan). As set forth in the RSA and the Proposed Plan, 70% of the Aggregate Rights Offering Amount (or $455 million, subject to the Excess Liquidity Cutback) (the “Subscription Amount”) will be raised by soliciting commitments from Eligible Holders (as defined in the rights offering procedures with respect to the Equity Rights Offering), while 30% (or $195 million, subject to the Excess Liquidity Cutback) (the “Direct Allocation Amount”) will be reserved for purchase by the Equity Commitment Parties (as defined below). As contemplated by the RSA, on January 17, 2023, the Debtors entered into an agreement (the “Backstop Commitment Agreement”) with certain of the Consenting BrandCo Lenders under the RSA (the “Equity Commitment Parties”), pursuant to which each of the Equity Commitment Parties has agreed to backstop, severally and not jointly and subject to the terms and conditions in the Backstop Commitment Agreement, the Aggregate Rights Offering Amount (collectively, the “Backstop Commitment”). The Backstop Commitment Agreement provides that (i) each of the Equity Commitment Parties will, subject to the terms and conditions in the Backstop Commitment Agreement, purchase its agreed percentage (the “Backstop Commitment Percentage”) of the New Common Stock (as defined in the Proposed Plan) representing the unsubscribed portion of the Subscription Amount, (ii) each of the Equity Commitment Parties will, subject to the terms and conditions in the Backstop Commitment Agreement, purchase its agreed percentage (the “Direct Allocation Percentage”) of the New Common Stock representing the Direct Allocation Amount, and (iii) each of the Equity Commitment Parties will, subject to the terms and conditions in the Backstop Commitment Agreement, subscribe for, and at the Closing purchase, the New Common Stock offered to such Equity Commitment Party in connection with the Equity Rights Offering.  As consideration for entering into the Backstop Commitment Agreement, each Equity Commitment Party will receive, upon the closing of the Equity Rights Offering, its Backstop Commitment Percentage of a 12.5% commitment premium on the $650 million aggregate amount of the initial funding commitments, which amount shall be payable in the form of New Common Stock at a 30% discount to Plan Equity Value (the “Equity Commitment Premium”).

To the extent that, as of the Closing Date (as defined under the Backstop Commitment Agreement), the sum of (i) unrestricted cash and cash equivalents of the loan parties under the First Lien Exit Facilities (as defined in the Proposed Plan) and (ii) undrawn availability under the Exit ABL Facility (as defined under the Proposed Plan) (excluding the effect of any temporarily increased advance rates under the Exit ABL Facility (as defined under the Proposed Plan) that will not remain in effect through the maturity date of such facility), exceeds $285.0 million (such excess, “Excess Liquidity”), then such Excess Liquidity will be applied, on a dollar for dollar basis, first, in an amount of up to $12.0 million to pay the Debt Commitment Premium and Funding Discount (as each is defined below) (on a ratable basis) in cash; second, to reduce the aggregate amount of the Equity Rights Offering on a dollar for dollar basis to not less than $625 million; third, to reduce the amount of the Incremental New Money Facility on a dollar for dollar basis such that the aggregate amount of the First Lien Exit Facilities (as defined in the Proposed Plan) is no less than $1.275 billion; and fourth, 50% of any remaining Excess Liquidity to further reduce the amount of the Incremental New Money Facility and 50% of any remaining Excess Liquidity to further reduce the amount of the Equity Rights Offering (collectively, the “Excess Liquidity Cutback”).

The Backstop Commitment Agreement may be terminated (a) by the Debtors (i) if the RSA is terminated as to the Debtors in accordance with its terms, (ii) if any Debtor Termination Event (as defined in the RSA) occurs (subject to certain exceptions), (iii) if the Bankruptcy Court denies entry of an order approving the Debtors’ entry into the Backstop Commitment Agreement, or if such order or any order confirming the Debtors’ chapter 11 plan of reorganization is reversed, dismissed, vacated or reconsidered, (iv) as to any Equity Commitment Party, if it materially breaches its obligations under the Backstop Commitment Agreement or the RSA and does not cure such breach or is replaced by the other Equity Commitment Parties after notice, (v) if the closing of the Equity Rights Offering does not occur by April 17, 2023, (vi) if the Debtors do not receive the Aggregate Rights Offering Amount (as such amount is adjusted pursuant to the Excess Liquidity provisions in the RSA) pursuant to the Equity Rights Offering and the Backstop Commitment Agreement, or (vii) if any applicable law or final non-appealable order shall have been enacted, adopted or issued by a governmental authority prohibiting the implementation of the Debtors’ chapter 11 plan of reorganization, the Equity Rights Offering or the transactions contemplated by the Backstop Commitment Agreement, the Debt Commitment Letter (as defined below) or the other Definitive Documents (as defined in the RSA) (a “Governmental Order Termination”), and (b) by Equity Commitment Parties that, in the aggregate, hold a majority of the Backstop Commitments under the Backstop Commitment Agreement (the “Required Equity Commitment Parties”), (i) if the RSA is terminated as to the Debtors in accordance with its terms (subject to certain exceptions), (ii) if any Consenting BrandCo Lender Termination Event (as defined in the RSA) occurs (subject to certain exceptions and assuming that such termination events are exercisable by the Required Equity Commitment Parties), (iii) if the Bankruptcy Court has not entered or denies entry of an order approving the Debtors’ entry into the Backstop Commitment Agreement on or prior to February 14, 2023 or the entry of an order confirming the Debtors’ chapter 11 plan of reorganization on or prior to April 3, 2023, or if any of such orders are reversed, dismissed, vacated or reconsidered, (iv) if the closing of the Equity Rights Offering does not occur by April 17, 2023, (v) if the Debtors breach the terms of the Backstop Commitment Agreement and are therefore unable to satisfy certain of the conditions precedent to the closing of the Equity Rights Offering, (v) if since September 30, 2022, there shall have occurred an event, development, occurrence or change that, individually or in the aggregate, has had or would reasonably be expected to have a Material Adverse Effect (as defined in the Backstop Commitment Agreement) (an “MAE Termination”), or (vi) if a Governmental Order Termination occurs.

If the Backstop Commitment Agreement is terminated (a) by the Debtors (i) upon the exercise of their Fiduciary Out (as defined in the Backstop Commitment Agreement) or acceptance or pursuit of an Alternative Restructuring Proposal (as defined in the Proposed Plan) that is not an Acceptable Alternative Transaction (as defined in the Proposed Plan) (subject to the terms and conditions set forth in section 9.02 of the RSA or 7.1 of the Backstop Commitment Agreement), (ii) upon the occurrence of a Debtor Termination Event (other than pursuant to a Specified Debtor RSA Termination Right (as defined in the Backstop Commitment Agreement), or (iii) if the closing of the Equity Rights Offering does not occur by April 17, 2023 (or such later date as agreed by the Debtors) and if the Required Equity Commitment Parties either have extended or indicated in writing that they would be willing to extend their Backstop Commitments beyond such date of termination, (b) by the Required Equity Commitment Parties (i) upon the occurrence of a Consenting BrandCo Lender Termination Event (other than pursuant to a Specified Lender RSA Termination Right (as defined in the Backstop Commitment Agreement)), (ii) upon the material breach of the Backstop Commitment Agreement by the Debtors, or (iii) if the closing of the Equity Rights Offering does not occur by a date after April 17, 2023 reasonably acceptable to each of the Debtors and the Required Equity Commitment Parties, or (c) by either the Debtors or the Required Equity Commitment Parties (i) upon the termination of the RSA as to the Debtors (other than pursuant to a Specified RSA Termination Right (as defined in the Backstop Commitment Agreement)), or (ii) if the order approving the Debtors’ entry into the Backstop Commitment Agreement or any order confirming the Debtors’ chapter 11 plan of reorganization is reversed, dismissed, vacated or reconsidered or if a Government Order Termination occurs, in each case of this clause (ii) unless such termination occurs as a result of an action or failure of an Equity Commitment Party to take an action required under the RSA or the Backstop Commitment Agreement, then in each case of clauses (a), (b) and (c), the Equity Commitment Parties shall be entitled to receive a premium in the aggregate amount of $81.25 million, representing 12.5% of the $650 million aggregate amount of their initial funding commitments, payable in cash pro rata in accordance with their percentage of the Backstop Commitment (the “Equity Termination Premium”).  Under no circumstances may the Equity Commitment Parties receive both the Equity Termination Premium and the Equity Commitment Premium.

The Backstop Commitment Agreement also provides that the Equity Commitment Parties shall be entitled to (i) payment for the reimbursement of certain reasonable and documented costs and expenses incurred in connection with the Backstop Commitment Agreement (the “Equity Expense Reimbursements”) and (ii) indemnification by the Debtors, including the payment of contribution and reimbursement of claims for certain losses, claims, damages, liabilities, costs, and expenses arising out of or in connection with the Equity Rights Offering or the Backstop Commitment Agreement (the “Equity Indemnification Obligations”), subject to the terms and conditions of the Backstop Commitment Agreement.

None of the Equity Commitment Premium, the Equity Termination Premium, the Equity Expense Reimbursements or the Equity Indemnification Obligations shall be payable to any (a) Equity Commitment Party in default of its obligations under the Backstop Commitment Premium or (b) Equity Commitment Party whose breach of the Backstop Commitment Agreement caused its termination.

Debt Commitment Letter

As contemplated by the RSA, on January 17, 2023, the Debtors entered into an agreement (the “Debt Commitment Letter”) with certain of the Consenting BrandCo Lenders under the RSA (the “Debt Commitment Parties”), pursuant to which the Debt Commitment Parties committed to fund up to $200 million in net cash proceeds to the Debtors in connection with new a senior secured first lien term loan facility (the “Incremental New Money Facility”).  As consideration for entering into the Debt Commitment Letter, the Debt Commitment Parties will receive a premium of 3.00% on their $200 million funding commitment payable in-kind as additional loans added to the principal amount of the Incremental New Money Facility (the “Debt Commitment Premium”). The Debt Commitment Letter may be terminated (a) by the Debtors, (i) if the RSA is terminated as to the Debtors in accordance with its terms, (ii) if any Debtor Termination Event (as defined in the RSA) occurs (subject to certain exceptions), (iii) if the Bankruptcy Court denies entry of an order approving the Debtors’ entry into the Debt Commitment Letter, or if such order or any order confirming the Debtors’ chapter 11 plan of reorganization is reversed, dismissed, vacated or reconsidered, (iv) as to any Debt Commitment Party, if it materially breaches its obligations under the Debt Commitment Letter or the RSA and does not cure such breach after notice or is replaced by the other Debt Commitment Parties, (v) if the closing of the Incremental New Money Facility does not occur by April 17, 2023, (vi) if the Debt Commitment Parties are obligated to fund the Incremental New Money Facility and the Debtors do not receive the full $200 million funding amount pursuant to the Debt Commitment Letter (as such amount is adjusted pursuant to the Excess Liquidity provisions in the RSA), or (vii) if a Governmental Order Termination occurs, and (b) by Debt Commitment Parties that, in the aggregate, hold a majority of the commitments under the Debt Commitment Letter (the “Required Debt Commitment Parties”), (i) if the RSA is terminated as to the Debtors in accordance with its terms (subject to certain exceptions), (ii) if any Consenting BrandCo Lender Termination Event (as defined in the RSA) occurs (subject to certain exceptions and assuming that such termination events are exercisable by the Required Debt Commitment Parties), (iii) if the Bankruptcy Court has not entered or denies entry of an order approving the Debtors’ entry into the Debt Commitment Letter on or prior to February 14, 2023 or the entry of an order confirming the Debtors’ chapter 11 plan of reorganization on or prior to April 3, 2023, or if any of such orders, including the Confirmation Order, is reversed, dismissed, vacated or reconsidered, (iv) if the closing of the Incremental New Money Facility does not occur by April 17, 2023 (which date may be waived or extended with the consent of the Required Debt Commitment Parties up to June 17, 2023), (v) if an MAE Termination occurs, or (vi) if a Governmental Order Termination occurs.