mew Doc 779 Filed 06/27/17 Entered 06/27/17 11:47:34 Main Document Pg 1 of 46

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1 Pg 1 of 46 Presentment Date and Time: July 11, 2017 at 10:00 a.m. (Eastern Time) Objection Deadline: July 10, 2017 at 2:00 p.m. (Eastern Time) Hearing Date and Time (Only if Objection Filed): July 25, 2017 at 11:00 a.m. (Eastern Time) WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, New York Telephone: (212) Facsimile: (212) Gary T. Holtzer Robert J. Lemons Garrett A. Fail Attorneys for Debtors and Debtors in Possession UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK x In re : Chapter 11 : WESTINGHOUSE ELECTRIC COMPANY : Case No (MEW) LLC, et al., : : : Debtors. 1 : (Jointly Administered) : x NOTICE OF PRESENTMENT FOR ENTRY OF AN ORDER AUTHORIZING WESTINGHOUSE ELECTRIC COMPANY LLC TO EMPLOY AND RETAIN MILBANK, TWEED, HADLEY & M c CLOY LLP AS SPECIAL COUNSEL TO THE U.S. AP1000 COMMITTEE OF THE BOARD OF DIRECTORS OF WESTINGHOUSE ELECTRIC COMPANY LLC EFFECTIVE AS OF MAY 4, The Debtors in these chapter 11 cases, along with the last four digits of each Debtor s federal tax identification number, if any, are: Westinghouse Electric Company LLC (0933), CE Nuclear Power International, Inc. (8833), Fauske and Associates LLC (8538), Field Services, LLC (2550), Nuclear Technology Solutions LLC (1921), PaR Nuclear Holding Co., Inc. (7944), PaR Nuclear, Inc. (6586), PCI Energy Services LLC (9100), Shaw Global Services, LLC (0436), Shaw Nuclear Services, Inc. (6250), Stone & Webster Asia Inc. (1348), Stone & Webster Construction Inc. (1673), Stone & Webster International Inc. (1586), Stone & Webster Services LLC (5448), Toshiba Nuclear Energy Holdings (UK) Limited (N/A), TSB Nuclear Energy Services Inc. (2348), WEC Carolina Energy Solutions, Inc. (8735), WEC Carolina Energy Solutions, LLC (2002), WEC Engineering Services Inc. (6759), WEC Equipment & Machining Solutions, LLC (3135), WEC Specialty LLC (N/A), WEC Welding and Machining, LLC (8771), WECTEC Contractors Inc. (4168), WECTEC Global Project Services Inc. (8572), WECTEC LLC (6222), WECTEC Staffing Services LLC (4135), Westinghouse Energy Systems LLC (0328), Westinghouse Industry Products International Company LLC (3909), Westinghouse International Technology LLC (N/A), and Westinghouse Technology Licensing Company LLC (5961). The Debtors principal offices are located at 1000 Westinghouse Drive, Cranberry Township, Pennsylvania WEIL:\ \4\

2 Pg 2 of 46 PLEASE TAKE NOTICE that on July 11, 2017 at 10:00 a.m. (Eastern Time), the undersigned will present the annexed Application of Westinghouse Electric Company LLC for Authority to Employ and Retain Milbank, Tweed, Hadley and M c Cloy LLP as Special Counsel to the U.S. AP1000 Committee of the Board of Directors of Westinghouse Electric Company LLC Effective as of May 4, 2017 to the Honorable Michael E. Wiles, in the United States Bankruptcy Court for the Southern District of New York, located at One Bowling Green, New York, New York, (the Bankruptcy Court ). PLEASE TAKE FURTHER NOTICE that any responses or objections (the Objections ) to the Application must be in writing, shall conform to the Federal Rules of Bankruptcy Procedure and the Local Bankruptcy Rules, and shall be filed with the Bankruptcy Court (a) by attorneys practicing in the Bankruptcy Court, including attorneys admitted pro hac vice, electronically in accordance with General Order M-399 (which can be found at and (b) by all other parties in interest, on a CD-ROM, in textsearchable portable document format (PDF) (with a hard copy delivered directly to Chambers), in accordance with the customary practices of the Bankruptcy Court and General Order M-399, to the extent applicable, and served in accordance with General Order M-399 and the Order Pursuant to 11 U.S.C. 105(a) and Fed. R. Bankr. P. 1015(c), 2002(m), and 9007 Implementing Certain Notice and Case Management Procedures [ECF No. 101] so as to be received no later than July 10, 2017 at 2 p.m. (Eastern Time) (the Objection Deadline ). 2 WEIL:\ \4\

3 Pg 3 of 46 PLEASE TAKE FURTHER NOTICE that if no Objections are timely filed and served with respect to Application, the Debtors may, on or after the Objection Deadline, submit to the Bankruptcy Court an order substantially in the form of the proposed order annexed to the Application, which order may be entered with no further notice or opportunity to be heard. Dated: June 27, 2017 New York, New York /s/ Robert J. Lemons Gary T. Holtzer Robert J. Lemons Garrett A. Fail WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, New York Telephone: (212) Facsimile: (212) gary.holtzer@weil.com robert.lemons@weil.com garrett.fail@weil.com Attorneys for Debtors and Debtors in Possession WEIL:\ \4\

4 Pg 4 of 46 WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, New York Telephone: (212) Facsimile: (212) Gary T. Holtzer Robert J. Lemons Garrett A. Fail Attorneys for Debtors and Debtors in Possession UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK x In re : Chapter 11 : WESTINGHOUSE ELECTRIC COMPANY : Case No (MEW) LLC, et al., : : : Debtors. 1 : (Jointly Administered) : x APPLICATION OF WESTINGHOUSE ELECTRIC COMPANY LLC PURSUANT TO 11 U.S.C. 327(e) AND 328(a), FED. R. BANKR. P. 2014(a) AND 2016, AND LOCAL RULE FOR AUTHORITY TO EMPLOY AND RETAIN MILBANK, TWEED, HADLEY & M c CLOY LLP AS SPECIAL COUNSEL TO THE U.S. AP1000 COMMITTEE OF THE BOARD OF DIRECTORS OF WESTINGHOUSE ELECTRIC COMPANY LLC, EFFECTIVE AS OF MAY 4, The Debtors in these chapter 11 cases, along with the last four digits of each Debtor s federal tax identification number, if any, are: Westinghouse Electric Company LLC (0933), CE Nuclear Power International, Inc. (8833), Fauske and Associates LLC (8538), Field Services, LLC (2550), Nuclear Technology Solutions LLC (1921), PaR Nuclear Holding Co., Inc. (7944), PaR Nuclear, Inc. (6586), PCI Energy Services LLC (9100), Shaw Global Services, LLC (0436), Shaw Nuclear Services, Inc. (6250), Stone & Webster Asia Inc. (1348), Stone & Webster Construction Inc. (1673), Stone & Webster International Inc. (1586), Stone & Webster Services LLC (5448), Toshiba Nuclear Energy Holdings (UK) Limited (N/A), TSB Nuclear Energy Services Inc. (2348), WEC Carolina Energy Solutions, Inc. (8735), WEC Carolina Energy Solutions, LLC (2002), WEC Engineering Services Inc. (6759), WEC Equipment & Machining Solutions, LLC (3135), WEC Specialty LLC (N/A), WEC Welding and Machining, LLC (8771), WECTEC Contractors Inc. (4168), WECTEC Global Project Services Inc. (8572), WECTEC LLC (6222), WECTEC Staffing Services LLC (4135), Westinghouse Energy Systems LLC (0328), Westinghouse Industry Products International Company LLC (3909), Westinghouse International Technology LLC (N/A), and Westinghouse Technology Licensing Company LLC (5961). The Debtors principal offices are located at 1000 Westinghouse Drive, Cranberry Township, Pennsylvania

5 Pg 5 of 46 TO THE HONORABLE MICHAEL E. WILES, UNITED STATES BANKRUPTCY JUDGE: Westinghouse Electric Company LLC (the Company ) and certain debtor affiliates, as debtors and debtors in possession in the above-captioned chapter 11 cases (collectively, the Debtors ), respectfully represent as follows in support of this application (the Application ). Background 1. On March 29, 2017 (the Petition Date ), each Debtor commenced with this Court a voluntary case under chapter 11 of title 11 of the United States Code (the Bankruptcy Code ). The Debtors are authorized to continue to operate their businesses and manage their properties as debtors in possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. No trustee or examiner has been appointed in these chapter 11 cases. 2. The Debtors chapter 11 cases are being jointly administered for procedural purposes only pursuant to Rule 1015(b) of the Federal Rules of Bankruptcy Procedure (the Bankruptcy Rules ). 3. On April 7, 2017, the United States Trustee for Region 2 appointed the Official Committee of Unsecured Creditors pursuant to section 1102 of the Bankruptcy Code. 4. Additional information regarding the Debtors business, capital structure, and the circumstances leading to the commencement of these chapter 11 cases is set forth in the Declaration of Lisa J. Donahue Pursuant to Rule of the Local Bankruptcy Rules for the Southern District of New York, sworn to and filed on the Petition Date [ECF No. 4]. 2

6 Pg 6 of 46 Jurisdiction 5. The Court has jurisdiction to consider this matter pursuant to 28 U.S.C. 157 and This is a core proceeding pursuant to 28 U.S.C. 157(b). Venue is proper before the Court pursuant to 28 U.S.C and Relief Requested 6. By this Application, pursuant to sections 327(e) and 328(a) the Bankruptcy Code, Bankruptcy Rules 2014(a) and 2016, and Rule of the Local Bankruptcy Rules for the Southern District of New York (the Local Rules ), the Debtors request authority to employ and retain Milbank, Tweed, Hadley & M c Cloy LLP ( Milbank ) as special counsel to the U.S. AP1000 Committee of the Company s Board of Directors (the Special Committee ), effective as of May 4, A proposed form of order granting the relief requested herein on a final basis is annexed hereto as Exhibit A (the Proposed Order ). 8. In support of this Application, the Debtors submit the declaration of Thomas R. Kreller, a partner in Milbank s Financial Restructuring Group, annexed hereto as Exhibit B (the Kreller Declaration ) and the declaration of Marc Beilinson, Chairman of the Special Committee, annexed hereto as Exhibit C (the Beilinson Declaration ). Appointment of the Special Committee 9. As the Court is aware, the principal issues that precipitated the Debtors filing of the chapter 11 cases were the financial and operational issues existing with respect to (a) certain AP1000 nuclear plants located in the State of Georgia (the Georgia Plants ) and in the State of South Carolina (the South Carolina Plants and, together with the Georgia Plants, the Projects ), (b) the Debtors role in the construction of the Projects, and (c) the existence of 3

7 Pg 7 of 46 certain guarantees issued by Toshiba Corporation, the parent company of Westinghouse Electric Company LLC ( Toshiba ), relating to the Projects. 10. The Company has a complex set of contractual rights and obligations related to the Projects. Toshiba, in turn, has its own rights and obligations under its guarantees of the Projects. Given the complexity and magnitude of these multi-party arrangements, it became clear that it would be in the best interests of the Company to form the Special Committee, comprised only of those directors having no prior affiliation with Toshiba. The purpose of the Special Committee is to (a) supervise, manage, monitor, and oversee the Company s ongoing day-to-day activities in connection with the Projects, including discussions and negotiations with the owners of the Projects (the Project Owners ); (b) consider, investigate, review, and evaluate the conditions under which the Projects may be continued or discontinued, including transactions related to either of the Projects; and (c) make such recommendations to the board of directors of the Company (the Board ) regarding such potential transactions as the Special Committee deemed appropriate (collectively, the Project- Related Tasks ). 11. The three independent directors who serve on the Special Committee are: (i) Mr. Wyatt Wachtel; (ii) Mr. William Transier; and (iii) Mr. Marc Beilinson. Mr. Beilinson chairs the Special Committee. None of the members of the Special Committee are affiliated with Toshiba. At a special meeting held on May 19, 2017, the Company s Board formally adopted resolutions (a) appointing the Special Committee; (b) delegating to the Special Committee the authority to perform the Project-Related Tasks; (c) authorizing the Special Committee to retain independent counsel, at the expense of the Debtors estates, to advise it in connection with the foregoing; and (d) designating Mr. Beilinson as chair. 4

8 Pg 8 of Given the urgency surrounding the Company s negotiations with the Project Owners, the activities of the Special Committee actually commenced prior to the Board s formal adoption of the May 19 th resolutions. Mr. Beilinson, in particular, was actively involved in Company discussions regarding the negotiations with the Project Owners even prior to the Petition Date. As negotiations progressed, the Board determined that the appointment of the Special Committee was an appropriate step in the exercise of its fiduciary duties. The Special Committee subsequently determined to retain Milbank as counsel to advise the Special Committee on matters within the scope of its duties. At the request of the directors, who now comprise the Special Committee, Milbank began providing those services to the independent directors on or around May 4, The Special Committee initially was formed to address the Project-Related Tasks. Given the complexity of the relationship between the Company and Toshiba, however, it is likely that other issues may arise for consideration and action by the Company s Board where the independent view of the Special Committee may likewise be appropriate. Accordingly, the Special Committee s engagement of Milbank expressly contemplates that Milbank s role as special counsel may expand as necessary to mirror any expansion in the activities of the Special Committee as and when the Board delegates any additional tasks to the Special Committee. Retention of Milbank A. Services to Be Provided by Milbank 14. Pursuant to section 327(e) of the Bankruptcy Code and subject to Court approval, the Company respectfully submits that it will be necessary to employ and retain Milbank to provide specific legal advice to the Special Committee in connection with the Project-Related Tasks, as well as, subject to the Board s delegation of additional matters or tasks, 5

9 Pg 9 of 46 such other services upon which the Special Committee and Milbank may mutually agree (the Delegated Tasks ). 15. Milbank possesses extensive knowledge and expertise in the areas of law relevant to these chapter 11 cases, and Milbank is well-qualified to represent the Special Committee. In selecting its counsel, the Special Committee sought counsel with a wide variety of experiences representing debtors and creditors in large chapter 11 cases and other debt-restructuring scenarios, as well as recognized expertise in the energy and project finance industries. Milbank has such experience, having represented a number of debtors and creditors in significant cases under chapter 11 of the Bankruptcy Code. 16. Specifically, Milbank s 50 plus financial restructuring attorneys worldwide have played significant roles in many large chapter 11 cases, including serving as court-approved counsel to the debtors and debtors in possession in the following cases of national significance, among others: In re Northshore Mainland Servs., Inc., Case No (KJC) (Bankr. D. Del.); In re Frederick s of Hollywood, Inc., Case No (KG) (Bankr. D. Del.); In re Eagle Bulk Shipping Inc., Case No (SHL) (Bankr. S.D.N.Y.); In re Outer Harbor Terminal, LLC, Case No (LSS) (Bankr. D. Del.); In re MACH Gen, LLC, Case No (MFW) (Bankr D. Del.); In re Circus and Eldorado Joint Venture, Case No (BTB) (Bankr. D. Nev.); In re LightSquared Inc., Case No (SCC) (Bankr. S.D.N.Y.); In re Real Mex Rests., Inc., Case No (BLS) (Bankr. D. Del); In re Claim Jumper Restaurants, LLC, Case No (KG) (Bankr. D. Del.); In re PCAA Parent, LLC, Case No (MFW) (Bankr. D. Del.); In re ProtoStar Ltd., Case No (MFW) (Bankr. D. Nev.); In re Station Casinos, Inc., Case No (GWZ) (Bankr. D. Nev.); In re Tubo de Pastejé, S.A. de C.V., Case No (KJC) (Bankr. D. Del.); In re 6

10 Pg 10 of 46 ProtoStar Ltd., Case No (MFW) (Bankr. D. Del.); J.L. French Auto. Castings, Inc., Case No (KG) (Bankr. D. Del.); In re Intermet Corp., Case No (KG) (Bankr. D. Del.); In re Alper Holdings USA, Inc., Case No (BRL) (Bankr. S.D.N.Y.). 17. Furthermore, Milbank has acknowledged expertise and extensive experience in matters relating to energy and project finance, including matters involving engineering, procurement, and construction ( EPC ) contracting for nuclear power plants, operations and maintenance of nuclear power plants, uranium enrichment projects and fuel supply issues, corporate finance, secured and unsecured lending transactions, derivatives transactions, project and structured finance, and securitizations, as well as the structuring and negotiation of commercial contracts (including, but not limited to, infrastructure and utilities agreements and construction) - all capabilities that will be important in assisting the Special Committee with the Delegated Tasks and enabling the Special Committee to function more efficiently and effectively. B. Disclosures Concerning Milbank s Connections to Parties in Interest 18. To the best of the Company s knowledge, information, and belief, based on and except as otherwise set forth in the Kreller Declaration, Milbank does not represent or hold any interest adverse to the Debtors or their estates with respect to any matters for which Milbank is being employed. The Kreller Declaration also sets forth, pursuant to Bankruptcy Rule 2014(a), to the best of Mr. Kreller s knowledge upon due inquiry, Milbank s connections with the Debtors, known creditors, other known parties in interest, their respective attorneys and accountants, the United States Trustee for Region 2, and any person employed in the Southern District of New York office of the United States Trustee. 7

11 Pg 11 of 46 C. Effective Date of Retention 19. The Company requests that Milbank s retention be approved effective as of May 4, 2017 the date Milbank began providing substantive services to the independent directors in connection with their eventual appointment to the Special Committee. Retention effective as of May 4, 2017 is appropriate in view of the nature and timing of the Special Committee s activities and its immediate and urgent need for the provision of legal services. D. Compensation of Milbank 20. Milbank intends to apply to the Court for payment of compensation and reimbursement of expenses in accordance with applicable provisions of the Bankruptcy Code, the Bankruptcy Rules, the Guidelines promulgated by the Office of the United States Trustee and the Local Rules and orders of this Court, and pursuant to any additional procedures that may be or have already been established by the Court in these chapter 11 cases. 21. Subject to the Court s approval, Milbank will be compensated by the Debtors estates at its standard hourly rates, which are based on the professionals level of experience, plus reimbursement of the actual and necessary expenses that Milbank incurs in accordance with the ordinary and customary rates which are in effect on the date the services are rendered. At present, the standard hourly rates charged by Milbank range from $1,015 to $1,395 for Partners, $1,015 to $1,215 for Counsel, $390 to $950 for Associates, and $195 to $345 for Legal Assistants. These hourly rates are subject to annual firm-wide adjustments in the ordinary course of Milbank s business, notice of which adjustments shall be provided to the Debtors, the Official Committee of Unsecured Creditors, and the United States Trustee. Milbank will maintain detailed, contemporaneous records of time and any necessary costs and expenses incurred in connection with the rendering of the legal services described above, and will be 8

12 Pg 12 of 46 reimbursed for such costs and expenses in conformity with the Guidelines promulgated by the United States Trustee as in effect in this District. E. Efforts to Avoid Duplication of Services 22. In addition to this Application, the Debtors have retained: (i) Weil, Gotshal & Manges, LLP, as lead global counsel for the Debtors; (ii) PJT Partners LP, as investment banker; (iii) AP Services, LLC, and Lisa Donahue as the Debtors Chief Transition and Development Officer; (iv) Kurtzman Carson Consultants LLC, as claims and noticing agent and administrative advisor; and (v) Togut, Segal & Segal LLP as counsel to Debtor Toshiba Nuclear Energy Holdings (UK) Limited. Debtors have also sought to retain K&L Gates as special counsel to the Debtors on certain matters. The Debtors may also file applications to employ additional professionals. Rather than resulting in any extra expense to the Debtors estates, it is anticipated that the efficient coordination of efforts of the Debtors attorneys and other professionals will greatly add to the progress and effective administration of these chapter 11 cases. The Debtors intend to carefully monitor and coordinate the efforts of all professionals retained by the Debtors in these chapter 11 cases, including any conflicts counsel, and will delineate their respective duties so as to prevent duplication of services whenever possible. Basis for Relief Requested 23. The Company respectfully requests that the Court authorize retention of Milbank as its attorneys pursuant to section 327(e) of the Bankruptcy Code, which provides that: 9

13 Pg 13 of U.S.C. 327(e). The trustee, with the court s approval, may employ, for a specified special purpose, other than to represent the trustee in conducting the case, a[] [firm] that has represented the debtor, if in the best interest of the estate, and if such [firm] does not represent or hold any interest adverse to the debtor or to the estate with respect to the matter on which such [firm] is to be employed. Fed. R. Bankr. P. 2014(a). 24. Bankruptcy Rule 2014(a) requires that an application for retention include: [S]pecific facts showing the necessity for the employment, the name of the [firm] to be employed, the reasons for the selection, the professional services to be rendered, any proposed arrangement for compensation, and, to the best of the applicant s knowledge, all of the [firm s] connections with the debtor, creditors, any other party in interest, their respective attorneys and accountants, the United States trustee, or any person employed in the office of the United States trustee. 25. Local Rule requires that an application state: S.D.N.Y. Bankr. L. R [S]pecific facts showing the reasonableness of the terms and conditions of the employment, including the terms of any retainer, hourly fee, or contingent fee arrangement. 26. The Company submits that for all the reasons stated above and in the Kreller Declaration, the retention of Milbank as counsel to the Special Committee is warranted and in the best interests of the Company. Accordingly, the Company respectfully requests that the retention of Milbank as counsel to the Special Committee be approved. Notice 27. Notice of this Application will be provided in accordance with the Order Pursuant to 11 U.S.C. 105(a) and Fed. R. Bankr. P. 1015(c), 2002(m), and 9007 Implementing Certain Notice and Case Management Procedures [ECF No. 101]. The Debtors submit that, in 10

14 Pg 14 of 46 view of the facts and circumstances, such notice is sufficient and no other or further notice need be provided. 28. No previous request for the relief sought herein has been made by the Debtors to this or any other Court. WHEREFORE the Company respectfully requests entry of the Proposed Order granting the relief requested herein and such other and further relief as the Court may deem just and appropriate. Dated: New York, New York June 27, 2017 WESTINGHOUSE ELECTRIC COMPANY LLC By: /s/lisa J. Donahue Name: Lisa J. Donahue Title: Chief Transition and Development Officer 11

15 Pg 15 of 46 Exhibit A Proposed Order

16 Pg 16 of 46 UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK x In re : Chapter 11 : WESTINGHOUSE ELECTRIC COMPANY : Case No (MEW) LLC, et al., : : : Debtors. 1 : (Jointly Administered) : x ORDER PURSUANT TO 327(e) AND 328(a), FED. R. BANKR. P. 2014(a) AND 2016, AND LOCAL RULE FOR AUTHORITY TO EMPLOY AND RETAIN MILBANK, TWEED, HADLEY & M c CLOY LLP AS SPECIAL COUNSEL TO THE U.S. AP1000 COMMITTEE OF THE BOARD OF DIRECTORS OF WESTINGHOUSE ELECTRIC COMPANY LLC, EFFECTIVE AS OF MAY 4, 2017 Upon the Application, dated June 27, 2017 (the Application ), of Westinghouse Electric Company LLC (the Company ) and certain debtor affiliates, as debtors and debtors in possession in the above-captioned chapter 11 cases (the Debtors ), pursuant to sections 327(e) and 328(a) of title 11 of the United States Code (the Bankruptcy Code ), Rules 2014(a) and 2016 of the Federal Rules of Bankruptcy Procedure (the Bankruptcy Rules ), and Rule of the Local Bankruptcy Rules for the Southern District of New York (the Local Rules ) for an order authorizing the employment and retention of Milbank, Tweed, Hadley & M c Cloy LLP 1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor s federal tax identification number, if any, are: Westinghouse Electric Company LLC (0933), CE Nuclear Power International, Inc. (8833), Fauske and Associates LLC (8538), Field Services, LLC (2550), Nuclear Technology Solutions LLC (1921), PaR Nuclear Holding Co., Inc. (7944), PaR Nuclear, Inc. (6586), PCI Energy Services LLC (9100), Shaw Global Services, LLC (0436), Shaw Nuclear Services, Inc. (6250), Stone & Webster Asia Inc. (1348), Stone & Webster Construction Inc. (1673), Stone & Webster International Inc. (1586), Stone & Webster Services LLC (5448), Toshiba Nuclear Energy Holdings (UK) Limited (N/A), TSB Nuclear Energy Services Inc. (2348), WEC Carolina Energy Solutions, Inc. (8735), WEC Carolina Energy Solutions, LLC (2002), WEC Engineering Services Inc. (6759), WEC Equipment & Machining Solutions, LLC (3135), WEC Specialty LLC (N/A), WEC Welding and Machining, LLC (8771), WECTEC Contractors Inc. (4168), WECTEC Global Project Services Inc. (8572), WECTEC LLC (6222), WECTEC Staffing Services LLC (4135), Westinghouse Energy Systems LLC (0328), Westinghouse Industry Products International Company LLC (3909), Westinghouse International Technology LLC (N/A), and Westinghouse Technology Licensing Company LLC (5961). The Debtors principal offices are located at 1000 Westinghouse Drive, Cranberry Township, Pennsylvania

17 Pg 17 of 46 ( Milbank ) as special counsel to the U.S. AP1000 Committee of the Board of Directors of Westinghouse Electric Company LLC (the Special Committee ), effective as of May 4, 2017, as more fully set forth in the Application; and upon the declaration of Thomas R. Kreller, a partner in Milbank s Financial Restructuring Group, annexed to the Application as Exhibit B (the Kreller Declaration ), and the declaration of Marc Beilinson, Chairman of the Special Committee, annexed to the Application as Exhibit C (the Beilinson Declaration ); and the Court being satisfied, based on representations made in the Application and the Kreller Declaration, that Milbank represents or holds no interests adverse to the Debtors or the Debtors estates with respect to the matters upon which Milbank is to be engaged; and the Court having jurisdiction to consider the Application and the relief requested therein in accordance with 28 U.S.C. 157(a) (b) and 1334(b) and the Amended Standing Order of Reference M-431, dated January 31, 2012 (Preska, C.J.); and consideration of the Application and the relief requested therein being a core proceeding pursuant to 28 U.S.C. 157(b); and venue being proper before this Court pursuant to 28 U.S.C and 1409; and notice of the Application having been given as provided in the Application, and such notice having been adequate and appropriate under the circumstances; and it appearing that no other or further notice of the Application need be provided; and the Court having found and determined that the relief sought in the Application and granted herein is in the best interests of the Debtors, their respective estates and creditors, and all parties in interest, and that the legal and factual bases set forth in the Application establish just cause for the relief granted herein; and after due deliberation and sufficient cause appearing therefor, IT IS HEREBY ORDERED THAT: 1. The Application is granted, effective as of May 4,

18 Pg 18 of Milbank s employment and retention by the Company as special counsel to the U.S. AP1000 Committee of the Board of Directors of Westinghouse Electric Company LLC is necessary and is in the best interests of the Debtors, their estates, their creditors, and other parties in interest, and Milbank s hourly rates for its paralegals and attorneys set forth in the Kreller Declaration are reasonable. 3. Pursuant to sections 327(e) and 328(a) of the Bankruptcy Code, Bankruptcy Rules 2014(a) and 2016, and Local Rule , the Company is authorized to employ and retain Milbank as counsel for the Special Committee, effective as of May 4, 2017, on the terms set forth in the Application. 4. Milbank shall be compensated for fees and reimbursed for reasonable and necessary expenses and shall file interim and final fee applications for allowance of its compensation and expenses pursuant to sections 330 and 331 of the Bankruptcy Code and in accordance with the Bankruptcy Rules, Local Bankruptcy Rule , the Amended Guidelines for Fees and Disbursements for Professionals in the Southern District of New York, dated January 29, 2013 and effective February 5, 2013, the Amended Order Establishing Procedures for Monthly Compensation and Reimbursement of Expenses of Professionals, dated December 21, 2010, and any other order of the Court. 5. In connection with any increases in Milbank s rates, as set forth in paragraph 21 of the Application, Milbank shall file a supplemental declaration with this Court and provide ten business days notice to the United States Trustee, the Official Committee of Unsecured Creditors, and the Debtors prior to filing a fee statement or fee application reflecting an increase in such rates. 3

19 Pg 19 of 46 enforceable upon its entry. this Order shall govern. 6. The terms and conditions of this order shall be immediately effective and 7. To the extent the Application is inconsistent with this Order, the terms of 8. The Court shall retain exclusive jurisdiction to hear and determine all matters arising from the implementation of this order. Dated: New York, New York, 2017 HONORABLE MICHAEL E. WILES UNITED STATES BANKRUPTCY JUDGE 4

20 Pg 20 of 46 Exhibit B Kreller Declaration

21 Pg 21 of 46 UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK x In re : Chapter 11 : WESTINGHOUSE ELECTRIC COMPANY : Case No (MEW) LLC, et al., : : : Debtors. 1 : (Jointly Administered) : x DECLARATION AND DISCLOSURE STATEMENT OF THOMAS R. KRELLER ON BEHALF OF MILBANK, TWEED, HADLEY & MC C LOY LLP PURSUANT TO 11 U.S.C. 327(e), 328(a), 329, AND 504 AND FED. R. BANKR. P. 2014(a) AND 2016 THOMAS R. KRELLER, under penalty of perjury, declares: 1. I am a partner in the Financial Restructuring Group of the firm of Milbank, Tweed, Hadley & M c Cloy LLP ( Milbank ), proposed special counsel to the U.S. AP1000 Committee of the Board of Directors (the Special Committee ) of Westinghouse Electric Company LLC (the Company ). 2. I submit this Declaration in support of the application submitted on the date hereof (the Application ), 2 of Westinghouse Electric Company LLC for authority to 1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor s federal tax identification number, if any, are: Westinghouse Electric Company LLC (0933), CE Nuclear Power International, Inc. (8833), Fauske and Associates LLC (8538), Field Services, LLC (2550), Nuclear Technology Solutions LLC (1921), PaR Nuclear Holding Co., Inc. (7944), PaR Nuclear, Inc. (6586), PCI Energy Services LLC (9100), Shaw Global Services, LLC (0436), Shaw Nuclear Services, Inc. (6250), Stone & Webster Asia Inc. (1348), Stone & Webster Construction Inc. (1673), Stone & Webster International Inc. (1586), Stone & Webster Services LLC (5448), Toshiba Nuclear Energy Holdings (UK) Limited (N/A), TSB Nuclear Energy Services Inc. (2348), WEC Carolina Energy Solutions, Inc. (8735), WEC Carolina Energy Solutions, LLC (2002), WEC Engineering Services Inc. (6759), WEC Equipment & Machining Solutions, LLC (3135), WEC Specialty LLC (N/A), WEC Welding and Machining, LLC (8771), WECTEC Contractors Inc. (4168), WECTEC Global Project Services Inc. (8572), WECTEC LLC (6222), WECTEC Staffing Services LLC (4135), Westinghouse Energy Systems LLC (0328), Westinghouse Industry Products International Company LLC (3909), Westinghouse International Technology LLC (N/A), and Westinghouse Technology Licensing Company LLC (5961). The Debtors principal offices are located at 1000 Westinghouse Drive, Cranberry Township, Pennsylvania

22 Pg 22 of 46 employ and retain Milbank as counsel to the Special Committee, effective as of May 4, 2017 in compliance with sections 327(e), 328(a), 329, and 504 of title 11 of the United States Code, 11 U.S.C (as amended, the Bankruptcy Code ), and to provide the disclosure required under Rules 2014(a) and 2016(b) of the Federal Rules of Bankruptcy Procedure (the Bankruptcy Rules ) and Rule of the Local Bankruptcy Rules for the Southern District of New York (the Local Rules ). 3. Unless otherwise stated in this Declaration, I have knowledge of the facts set forth herein and, if called as a witness, I would testify thereto. 3 Retention of Milbank 4. The principal issues that precipitated the Debtors filing of the chapter 11 cases were the financial and operational issues existing with respect to (a) certain AP1000 nuclear plants located in the State of Georgia (the Georgia Plants ) and in the State of South Carolina (the South Carolina Plants and, together with the Georgia Plants, the Projects ), (b) the Debtors role in the construction of the Projects, and (c) the existence of certain guarantees issued by Toshiba Corporation, the parent company of Westinghouse Electric Company LLC ( Toshiba ), relating to the Projects. 5. The Company has a complex set of contractual rights and obligations related to the Projects. Toshiba, in turn, has its own rights and obligations under its guarantees of the Projects. Given the complexity and magnitude of these multi-party arrangements, it became clear that it would be in the best interests of the Company to form the Special Committee, comprised only of those directors having no prior affiliation with Toshiba. The 2 Capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the Application. 3 Certain of the disclosures set forth herein relate to matters not within my personal knowledge, but rather within the personal knowledge of other attorneys and employees at Milbank, and are based on information provided by them to me following review of applicable Milbank books and records. 2

23 Pg 23 of 46 purpose of the Special Committee is to (a) supervise, manage, monitor, and oversee the Company s ongoing day-to-day activities in connection with the Projects, including discussions and negotiations with the owners of the Projects (the Project Owners ); (b) consider, investigate, review, and evaluate the conditions under which the Projects may be continued or discontinued, including transactions related to either of the Projects; and (c) make such recommendations to the board of directors of the Company (the Board ) regarding such potential transactions as the Special Committee deemed appropriate (collectively, the Project- Related Tasks ). 6. The three independent directors who serve on the Special Committee are: (i) Mr. Wyatt Wachtel; (ii) Mr. William Transier; and (iii) Mr. Marc Beilinson. Mr. Beilinson chairs the Special Committee. None of the members of the Special Committee are affiliated with Toshiba. At a special meeting held on May 19, 2017, the Company s Board formally adopted resolutions (a) appointing the Special Committee; (b) delegating to the Special Committee the authority to perform the Project-Related Tasks; (c) authorizing the Special Committee to retain independent counsel, at the expense of the Debtors estates, to advise it in connection with the foregoing; and (d) designating Mr. Beilinson as chair. 7. Given the urgency surrounding the Company s negotiations with the Project Owners, the activities of the Special Committee actually commenced prior to the Board s formal adoption of the May 19 th resolutions. Mr. Beilinson, in particular, was actively involved in Company discussions regarding the negotiations with the Project Owners even prior to the Petition Date. As negotiations progressed, the Board determined that the appointment of the Special Committee was an appropriate step in the exercise of its fiduciary duties. The Special Committee subsequently determined to retain Milbank as counsel to advise the Special 3

24 Pg 24 of 46 Committee on matters within the scope of its duties. At the request of the directors, who now comprise the Special Committee, Milbank began providing those services to the independent directors on or around May 4, The Special Committee initially was formed to address the Project-Related Tasks. Given the complexity of the relationship between the Company and Toshiba, however, it is likely that other issues may arise for consideration and action by the Company s Board where the independent view of the Special Committee may likewise be appropriate. Accordingly, the Special Committee s engagement of Milbank expressly contemplates that Milbank s role as special counsel may expand as necessary to mirror any expansion in the activities of the Special Committee as and when the Board delegates any additional tasks to the Special Committee. Qualifications of Milbank 9. Milbank is an international law firm with its principal office located at 28 Liberty Street, New York, New York 10005, and with other offices located in Washington, D.C.; Los Angeles; London; Frankfurt; Munich; Singapore; Hong Kong; Beijing; São Paulo; Seoul; and Tokyo. Milbank possesses extensive knowledge and expertise in the areas of law relevant to these chapter 11 cases, and Milbank is well qualified to represent the U.S. AP1000 Committee of the Board of Directors of Westinghouse Electric Company LLC. 10. Specifically, Milbank s fifty (50) plus financial restructuring attorneys worldwide have played significant roles in many large chapter 11 cases, including serving as court-approved counsel to the debtors and debtors in possession in the following cases of national significance, among others: In re Northshore Mainland Servs., Inc., Case No (KJC) (Bankr. D. Del.); In re Frederick s of Hollywood, Inc., Case No (KG) (Bankr. D. Del.); In re Eagle Bulk Shipping Inc., Case No (SHL) (Bankr. S.D.N.Y.); In re 4

25 Pg 25 of 46 Outer Harbor Terminal, LLC, Case No (LSS) (Bankr. D. Del.); In re MACH Gen, LLC, Case No (MFW) (Bankr D. Del.); In re Circus and Eldorado Joint Venture, Case No (BTB) (Bankr. D. Nev.); In re LightSquared Inc., Case No (SCC) (Bankr. S.D.N.Y.); In re Real Mex Rests., Inc., Case No (BLS) (Bankr. D. Del); In re Claim Jumper Restaurants, LLC, Case No (KG) (Bankr. D. Del.); In re PCAA Parent, LLC, Case No (MFW) (Bankr. D. Del.); In re ProtoStar Ltd., Case No (MFW) (Bankr. D. Nev.); In re Station Casinos, Inc., Case No (GWZ) (Bankr. D. Nev.); In re Tubo de Pastejé, S.A. de C.V., Case No (KJC) (Bankr. D. Del.); In re ProtoStar Ltd., Case No (MFW) (Bankr. D. Del.); J.L. French Auto. Castings, Inc., Case No (KG) (Bankr. D. Del.); In re Intermet Corp., Case No (KG) (Bankr. D. Del.); In re Alper Holdings USA, Inc., Case No (BRL) (Bankr. S.D.N.Y.). 11. Furthermore, Milbank has acknowledged expertise and extensive experience in matters relating to energy and project finance, including matters involving EPC contracting for nuclear power plants, operations and maintenance of nuclear power plants, uranium enrichment projects and fuel supply issues, corporate finance, secured and unsecured lending transactions, derivatives transactions, project and structured finance, and securitizations, as well as the structuring and negotiation of commercial contracts (including, but not limited to, infrastructure and utilities agreements and construction) - all capabilities that will be important in assisting the Special Committee with the Delegated Tasks and enabling the Special Committee to function more efficiently and effectively. Services to be Rendered 12. Milbank will provide legal advice to the Special Committee in connection with the Delegated Tasks. Specifically, Milbank s representation will consist of providing legal 5

26 Pg 26 of 46 services and advice to the Special Committee concerning the Debtors ongoing day-to-day activities in connection with the Projects, as well as such other projects as may be delegated to the Special Committee by the Board of Directors. 13. Subject to Court approval of the Application, Milbank is willing to serve as the Special Committee s counsel and to perform the services described above. Milbank also expects to work closely with the Company and its counsel to allocate responsibility for various tasks in order to avoid duplication of effort and to ensure the Delegated Tasks are performed as efficiently as possible. Subject to the delegation by the Board of additional matters or tasks, the Special Committee may, from time to time, request that Milbank undertake specific matters beyond the scope of the responsibilities set forth above. Milbank s engagement contemplates that Milbank may undertake any such specific matter as requested by the Special Committee. Disclosures Regarding Connections with Parties in Interest 14. Milbank does not represent and will not represent any entity other than the Special Committee in matters related to these chapter 11 cases. 15. To the best of my knowledge and except as otherwise set forth in this Declaration, the partners, counsel, associates and employees of Milbank: (i) do not have any connection with the Debtors, their known creditors, other known or potential parties in interest, their respective attorneys or accountants or other professionals, the U.S. Trustee or any person employed in such office of the U.S. Trustee, any United States Bankruptcy Judge or District Judge for the Southern District of New York or the Clerk of the Bankruptcy Court for the Southern District of New York or any person employed by the office of such Clerk; and (ii) do not represent any other entity having an adverse interest to the Debtors or their estates in connection with any matters on which Milbank seeks to be employed. 6

27 Pg 27 of In connection with its proposed retention by the Company as counsel to the Special Committee in these chapter 11 cases, at my direction, Milbank personnel searched the firm s client database to determine whether it had any relationships with (i) any of the parties set forth in the conflicts checklist provided by the Debtors restructuring counsel, Weil, Gotshal & Manges LLP, (the Debtors Retention Checklist ) and (ii) the names of other known or potential parties in interest based upon information provided to Milbank by the Debtors or information that was otherwise publicly available. A list of the categories of parties searched is attached hereto as Schedule At my direction, Milbank personnel also made a general inquiry to all partners and employees of the firm requesting disclosure of any relationship with (a) any Bankruptcy Judge or District Judge in the Southern District of New York, (b) anyone employed by the Office of the Clerk of the Bankruptcy Court for the Southern District of New York, or (c) any trustee, attorney or staff employed by the office of the U.S. Trustee. Additionally, Milbank personnel requested disclosure by all partners and employees, to the best of their knowledge, of any claims held against, or equity interest in, any of the Debtors and whether any Milbank employee is or was a director, officer or general partner of the Debtors or a relative of a director, officer or general partner of the Debtors. 18. To the extent that such searches indicated that Milbank or any of its partners or employees has or had a relationship with any such entity within the last two years, the identity of such entity, and Milbank s relationship therewith, are set forth on Schedule 2 attached hereto. 7

28 Pg 28 of To the best of my knowledge, during the two-year period prior to the date hereof, Milbank did not represent any of the Debtors or their respective officers or directors, including any of the members of the Special Committee, in any matters related to the Debtors. 20. With the exception of the Bank of Tokyo Mitsubishi, BNP Paribas, Citigroup, Deutsche Bank, Mitsui, and Santander (discussed separately below), no single client of Milbank listed on Schedule 2 accounted for more than 1% of Milbank s gross revenues for the years ending December 31, 2015 or December 31, For each of the years ending December 31, 2015 and December 31, 2016, each of the Bank of Tokyo Mitsubishi, BNP Paribas, Citigroup, Deutsche Bank, Mitsui, and Santander accounted for more than 1% but less than 2.25% of Milbank s gross revenue for such year. 21. Based upon the filings in these chapter 11 cases and the Debtors Retention Checklist, it appears that the Bank of Tokyo Mitsubishi, Banco Santander and Mitsui are Beneficiaries of Letters of Credit and Surety Bonds in these chapter 11 cases. It also appears that the Bank of Tokyo Mitsubishi, Banco Santander, BNP Paribas, Citigroup and Deutsche Bank are Financial Institutions (LC Banks) involved in these chapter 11 cases. BNP Paribas also appears to be a Financial Institution (Bank Accounts), Financial Institution (Swap Counterparty Banks) and Administrative Agent and Mitsui appears to be an Insurance and Surety Bond Provider in these chapter 11 cases. Milbank has not represented the Bank of Tokyo Mitsubishi, BNP Paribas, Citigroup, Deutsche Bank, Mitsui, or Santander in connection with any matters relating to the Debtors and does not, and will not, represent Bank of Tokyo Mitsubishi, BNP Paribas, Citigroup, Deutsche Bank, Mitsui, or Santander in any capacity in connection with these chapter 11 cases. 8

29 Pg 29 of From time to time, Milbank interacts with certain of the professional firms that have been or are proposed to be employed by the Debtors or other parties in these chapter 11 cases and that may be rendering advice to other parties in interest in these chapter 11 cases. In connection with unrelated matters, certain of the financial advisors and investment bankers who are or are proposed to be retained in these chapter 11 cases may have been retained by Milbank or Milbank s clients. These relationships with other professional firms are also identified on Schedule The Debtors have numerous relationships and creditors. Consequently, although every reasonable effort has been made to discover and eliminate the possibility of any connection or conflict, including the efforts outlined above, Milbank is unable to state with certainty which of its clients or such clients affiliated entities hold claims or otherwise are parties in interest in these chapter 11 cases. If Milbank discovers any information that is contrary or pertinent to the statements made herein, Milbank will promptly disclose such information to the Court on notice to such creditors and to the U.S. Trustee and such other creditors or other parties in interest as may be required under noticing procedures applicable in these chapter 11 cases. Professional Compensation 23. As of the date of this Declaration, Milbank has received no compensation for its work on behalf of the Special Committee. 24. Subject to the Court s approval, Milbank will be compensated at its standard hourly rates, which are based on the professionals level of experience, for its services to the Special Committee. At present, the standard hourly rates charged by Milbank range from $1,015 to $1,395 for Partners, $1,015 to $1,215 for Counsel, $390 to $950 for Associates, and 9

30 Pg 30 of 46 $195 to $345 for Legal Assistants. These hourly rates are subject to annual firm-wide adjustments in the ordinary course of Milbank s business, notice of which will be provided to the Debtors and the United States Trustee. Milbank will maintain detailed, contemporaneous records of time and any necessary costs and expenses incurred in connection with the rendering of the legal services described above, and will be reimbursed for such costs and expenses in conformity with the Guidelines promulgated by the United States Trustee as in effect in this District. 25. The hourly rates set forth herein are the firm s standard hourly rates for work of this nature. These rates are set at a level designed to compensate Milbank for the work of its attorneys and legal assistants and to cover fixed and routine overhead expenses. It is the firm s policy to charge its clients for all disbursements and expenses incurred in the rendition of services. These disbursements and expenses include, among other things, costs for telephone and facsimile charges, photocopying, travel, business meals, computerized research, messengers, couriers, postage, witness fees and other fees related to trials and hearings. 26. Milbank intends to apply to the Court for payment of compensation and reimbursement of expenses incurred as counsel to the Special Committee in accordance with applicable provisions of the Bankruptcy Code, the Bankruptcy Rules, the Local Rules, the Guidelines promulgated by the United States Trustee currently in effect for this District, and the orders of this Court, and pursuant to any additional procedures that may be established by the Court in these chapter 11 cases. 27. Other than as set forth above, there is no proposed arrangement between the Special Committee and Milbank for compensation to be paid in these chapter 11 cases. 10