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Ineos Group Holdings S.A ______________________________________________________________________ INEOS GROUP HOLDINGS S.A. 2013 ANNUAL REPORT ______________________________________________________________________ TABLE OF CONTENTS Page Certain Definitions and Presentation of Financial and Other Information ............................................................ ii Forward-Looking Statements .............................................................................................................................. vii Historical and Current Market and Industry Data ............................................................................................... viii Financial Information Included in this Annual Report .......................................................................................... ix Risk Factors ............................................................................................................................................................ 1 Selected Financial Information ............................................................................................................................. 30 Use of Non-GAAP Financial Measures ................................................................................................................ 32 Operating and Financial Review and Prospects .................................................................................................... 33 Business ................................................................................................................................................................ 56 Management ......................................................................................................................................................... 91 Principal Shareholders .......................................................................................................................................... 93 Certain Relationships and Related Party Transactions ......................................................................................... 94 Description of Certain Indebtedness ..................................................................................................................... 96 Glossary of Selected Terms ............................................................................................................................... G-1 Index to Extracted Financial Statements ............................................................................................................ F-1 i CERTAIN DEFINITIONS AND PRESENTATION OF FINANCIAL AND OTHER INFORMATION Unless indicated otherwise in this annual report or the context requires otherwise: • all references to “INEOS Group”, “INEOS”, “Group”, “we”, “us” or “our” are to INEOS Group Holdings S.A. and its consolidated subsidiaries; • all references to the “2016 IGH Notes Issuer”, “2018 IGH Notes Issuer”, “Parent” or “IGH” are to INEOS Group Holdings S.A. and not to any of its subsidiaries; • all references to “INEOS AG” are to INEOS AG, the ultimate parent of IGH, through its controlling interest in the voting share capital of IH; • all references to “INEOS Holdings” or “IHL” are to INEOS Holdings Limited, the direct parent company of the 2019 and 2020 Senior Secured Notes Issuer and an indirect wholly owned subsidiary of IGH; • all references to “INEOS Capital” are to INEOS Capital Limited or to INEOS Capital Partners; • all references to “IEL” are to INEOS Europe Limited, which is not part of the Group following the Refining Divestiture but is owned by the Entrepreneurial (Refining) Business JV; • all references to “IH” are to INEOS Holdings AG, an indirect parent company of the Issuer; • all references to “U.S. Borrower” are to INEOS US Finance LLC; • all references to the “2010 Senior Facilities Agreement” are to the multicurrency term and revolving facilities agreement, dated May 12, 2010, as subsequently amended, supplemented, varied or restated from time to time, made between, among others, IGL, IHL, certain subsidiaries of the Issuer, Barclays Bank PLC and certain lenders; • all references to the “2010 Senior Secured Credit Facilities” are to the facilities under the 2010 Senior Facilities Agreement, all of which were repaid in full on or before May 4, 2012; • all references to the “2015 Senior Secured Notes” are to the €300,000,000 aggregate principal 1 amount of 9 /4% Senior Secured Notes due 2015 and $570,000,000 aggregate principal amount of 9% Senior Secured Notes due 2015 issued pursuant to the 2015 Senior Secured Notes Indenture, which were redeemed in full on May 15, 2013; • all references to the “2015 Senior Secured Notes Indenture” are to the indenture dated May 12, 2010, between INEOS Finance plc, as issuer, the guarantors named therein, The Bank of New York Mellon, London Branch, as trustee, principal paying agent and transfer agent, The Bank of New York Mellon, as U.S. paying agent and transfer agent, The Bank of New York Mellon (Luxembourg) S.A., as registrar, Luxembourg paying agent and Luxembourg Transfer Agent, and Barclays Bank PLC, as security trustee, as supplemented by the supplemental indentures dated as of May 27, 2010, November 9, 2010, January 31, 2011, January 31, 2011, March 15, 2011, April 1, 2011, May 31, 2011 and August 13, 2012, pursuant to which the 2015 Senior Secured Notes were issued; • all references to the “2016 IGH Notes” and to the “2016 Notes” are to the €1,750,000,000 7 aggregate principal amount of 7 /8% Senior Notes due 2016 and $750,000,000 aggregate principal 1 amount of 8 /2% Senior Notes due 2016 issued pursuant to the 2016 IGH Notes Indenture, of 7 which €1,032,130,000 aggregate principal amount of the 7 /8% Senior Notes due 2016 is currently outstanding and which will be redeemed in full with the proceeds of the Offering; • all references to the “2016 IGH Notes Indenture” are to the indenture dated February 7, 2006, between the Issuer, as issuer, the guarantors named therein, The Bank of New York Mellon, as trustee, collateral agent, registrar and principal paying agent, and The Bank of New York Mellon (Luxembourg) S.A., as Luxembourg paying agent and Luxembourg transfer agent, as supplemented by supplemental indentures dated as of March 16, 2006, December 20, 2006, ii December 22, 2006, April 23, 2007, August 31, 2007, June 26, 2008, August 29, 2008, December 19, 2008, March 30, 2009, July 30, 2009, January 14, 2010, and April 6, 2010, May 12, 2010, November 9, 2010, January 31, 2011, January 31, 2011, March 15, 2011, April 1, 2011, May 31, 2011, August 13, 2012, September 1, 2013, December 19, 2013 and January 1, 2014, pursuant to which the 2016 IGH Notes were issued; • all references to the “2016 IGH Notes Proceeds Loans” are to the loans advanced under the loan agreement, dated February 7, 2006 (as amended and restated as of May 8, 2013) between the Issuer, as lender, and IHL, as borrower, pursuant to which the gross proceeds of the 2016 IGH Notes issuance were advanced to IHL, as amended or partially repaid from time to time, including the partial or full repayment thereof, on or about the Issue Date, from the proceeds of the New IGH Notes Proceeds Loans; • all references to the “2018 IGH Notes” and to the “2018 Notes” are to the €500,000,000 aggregate 1 principal amount of 6 /2% Senior Notes due 2018 and $678,000,000 aggregate principal amount of 1 6 /8% Senior Notes due 2018 issued pursuant to the 2018 IGH Notes Indenture; • all references to the “2018 IGH Notes Indenture” are to the indenture dated May 14, 2013, between the Issuer, as issuer, the guarantors named therein, The Bank of New York Mellon, London Branch, as trustee, collateral agent and principal paying agent, The Bank of New York Mellon (Luxembourg) S.A., as Luxembourg paying agent, registrar and Luxembourg transfer agent, and The Bank of New York Mellon as U.S. paying agent and transfer agent, as supplemented by the supplemental indentures dated as of June 5, 2013, September 1, 2013, January 1, 2014 and a fourth supplemental indenture to be dated on or before the Issue Date, pursuant to which the 2018 IGH Notes were issued; • all references to the “2018 IGH Notes Proceeds Loans” are to the loans advanced under the loan agreement, dated May 8, 2013, between the Issuer, as lender, and IHL, as borrower, pursuant to which the gross proceeds of the 2018 IGH Notes issuance were advanced to IHL, as amended or partially repaid from time to time; • all references to the “2019 and 2020 Senior Secured Notes Issuer” are to INEOS Finance plc; • all references to the “2019 Senior Secured Notes” and to the “2019 Notes” are to the €500,000,000 aggregate principal amount of Floating Rate Notes due 2019 and $1,000,000,000 3 aggregate principal amount of 8 /8% Senior Secured Notes due 2019 issued pursuant to the 2019 Senior Secured Notes Indenture; • all references to the “2019 Senior Secured Notes Indenture” are to the indenture dated February 10, 2012, among INEOS Finance plc, as issuer, the guarantors named therein, The Bank of New York Mellon, London Branch, as trustee, principal paying agent and transfer agent, The Bank of New York Mellon, as U.S. paying agent and transfer agent, The Bank of New York Mellon (Luxembourg) S.A., as registrar, Luxembourg paying agent and Luxembourg Transfer Agent, and Barclays Bank PLC, as security trustee, as supplemented by the supplemental indentures dated as of March 1, 2012, August 13, 2012, September 1, 2013, December 19, 2013 and January 1, 2014, pursuant to which the 2019 Senior Secured Notes were
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