Round 1: Braskem management and board

Cutoff: 17 August 2026. Verified means disclosed in a public filing. Reported means the 17 August Valor account based on unnamed sources. Inference means this agent's negotiating judgment.

1. Objective and alternative

The board's objective is to preserve the operating company, restore trade finance, protect enterprise value and reach a structure serviceable after petrochemical spreads normalize. Preserving the controllers' percentage is not an independent corporate objective.

The realistic alternative is not a clean return to the status quo. It is a short cure attempt followed by another liquidity event at the US$1.0B standby maturity. If creditor enforcement begins or trade finance contracts further, a prepared RJ becomes the defensive alternative. RJ is value-destructive because it can remove the LC and supplier-credit infrastructure needed to purchase feedstock.

2. Petrobras trade-credit proposal

The reported structure is the most executable form of Petrobras participation because it directly addresses the operating constraint and can be documented under an existing commercial relationship. It satisfies the liquidity part of burden-sharing only if all of the following are true:

• committed exposure of at least US$500M, with a target of US$750M;
• payment terms of up to 180 days, available on a revolving basis for at least three years;
• pricing no worse than SOFR plus 300bp to 400bp;
• no discretionary termination merely because an EJ is filed or a legacy bond default continues;
• first-priority security limited to the financed naphtha, resulting inventory, receivables and controlled proceeds; and
• availability begins with the plan-to-a-plan filing rather than final restructuring closing.

A US$250M cap is helpful but does not satisfy shareholder participation by itself. A US$950M cap could replace most of the required LC capacity, but the board should not assume the mathematical ceiling before it is committed. Supplier credit is not loss-absorbing capital, so IG4 and creditors still must provide junior or permanent funding.

3. Cure-and-continue

Curing approximately US$150M of July and August bond interest can prevent a payment default from becoming the immediate restructuring trigger if acceleration has not occurred. It does not replace US$572M of Q3 LC runoff or the US$1.0B December standby. Management will therefore offer a cure only as part of a documented bridge, not as an unconditional use of the remaining cash.

4. Opening package after the Valor report

1. File a plan-to-a-plan EJ before 24 August with one-third support, a 90-day negotiation period, no dividends or buybacks, weekly liquidity reporting, and restrictions on acquisitions and material asset sales.
2. Cure overdue bond interest at the earlier of a signed lock-up or effective interim EJ protection. No payment solely to remove negotiating pressure without a liquidity bridge.
3. Petrobras provides a US$750M revolving naphtha facility with up to 180-day terms for three years, SOFR plus 350bp, secured only by its working-capital pool.
4. LC banks commit US$750M for five years. Combined Petrobras and LC capacity is at least US$1.25B.
5. Extend the US$1.0B standby and 2028 bond by five years; extend 2029 to 2031 maturities by three years. Preserve the longest maturities.
6. For 24 months pay 4% cash interest with the remaining contractual coupon PIK. Thereafter pay the existing coupon plus 150bp.
7. IG4 contributes US$250M of subordinated, loss-absorbing funding. Creditors provide US$300M of new first-lien working-capital notes.
8. Creditors receive 12.5% fully diluted non-voting warrants, stepping to 20% if liquidity is below US$750M, annualized EBITDA is below US$2.0B, or PIK continues after 24 months.
9. No initial principal haircut. A contingent equitization of up to US$1.0B applies at the end of 2028 if net leverage remains above 5.0x.

5. First concession

• Petrobras cap reduced to US$500M, provided LC capacity increases to US$800M.
• Creditor warrants increase to 15%, stepping to 22.5%.
• Post-relief coupon increases by 200bp.
• Legacy debt receives a second lien on the working-capital pool after the Petrobras and new-money first lien, plus pledges of selected non-core shares.
• Excess cash above US$1.0B is swept 50% from 2029; 75% of qualifying asset-sale proceeds is swept.
• Creditors receive a board observer, a restructuring officer and consent rights over material debt, liens, acquisitions and asset sales.

6. Narrowest acceptable package

More than 25% immediate creditor ownership or blanket liens over the core crackers must be paired with material principal cancellation. Otherwise the package imposes RJ economics without reducing debt and may not be superior for the company.

7. Outcome probabilities

8. Fact that would most change the position

The binding Petrobras cap, duration, pricing and termination rights. A committed US$750M to US$950M revolving facility substantially reduces the separate LC need and makes a cure bridge credible. A discretionary US$250M facility does not.