Pg 1 of 13 WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, New York 10153 Telephone: (212) 310-8000 Facsimile: (212) 310-8007 Gary T. Holtzer Robert J. Lemons Kelly DiBlasi Matthew P. Goren Attorneys for Debtors and Debtors in Possession UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ---------------------------------------------------------------x : In re : Chapter 11 : WAYPOINT LEASING : Case No. 18-13648 (SMB) HOLDINGS LTD., et al., : : (Jointly Administered) Debtors. : ---------------------------------------------------------------x NOTICE OF FILING CORRECTED EXHIBIT PLEASE TAKE NOTICE that, on February 11, 2019, Waypoint Leasing Holdings Ltd. and certain of its subsidiaries and affiliates, as debtors and debtors in possession (collectively, the Debtors ) in the above-captioned chapter 11 cases, filed the Debtors' Omnibus Reply in Support of Motion to Approve Sale of Substantially All Assets [ECF No. 407] (the Debtors Omnibus Reply ). 1 1 Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Debtors Omnibus Reply. WEIL:\96914736\2\79984.0004
Pg 2 of 13 PLEASE TAKE FURTHER NOTICE that due to a ministerial error, the Objection Summary, annexed as Exhibit A to the Debtors Omnibus Reply, did not include all pages to such exhibit. Attached hereto as Exhibit 1 is a complete Objection Summary. Dated: February 11, 2019 New York, New York /s/ Kelly DiBlasi WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, New York 10153 Telephone: (212) 310-8000 Facsimile: (212) 310-8007 Gary T. Holtzer Robert J. Lemons Kelly DiBlasi Matthew P. Goren Attorneys for Debtors and Debtors in Possession WEIL:\96914736\2\79984.0004
Pg 3 of 13 Exhibit 1 Objection Summary
Pg 4 of 13 OBJECTION SUMMARY 1 Responses to Limited Objections to Macquarie Sale No. 1. Bank of Utah, as WAC6 Administrative Agent [ECF No. 330] A. Allocation Methodology The WAC6 Administrative Agent states that it supports the Macquarie Sale but objects to the net book value methodology for funding the Winddown Account, the Fee Reserve Account, and for payment of sale transaction fees and other expenses. The objection asserts that such expenses should be allocated based on Macquarie s purchase price allocations. Reply and the Emergency Motion. 2. Ed Washecka [ECF No. 336] 3. SunTrust Bank, as WAC7 Administrative Agent [ECF No. 337] A. Waypoint Services Assets Mr. Washecka does not object to the Macquarie Sale, but states that to the extent any or all of Waypoint Leasing Services LLC s ( Waypoint Services ) assets are being sold to Macquarie, (i) the allocation of sale proceeds to such assets should be fair, transparent and disclosed, and (ii) such proceeds should be segregated and remain in trust for creditors of Waypoint Leasing Services LLC until a plan of reorganization or liquidation is filed or, in the alternative, until after the Debtors have filed their schedules and statements of financial affairs. A. Assumption /Holdback SunTrust states that it is supportive of the Macquarie Sale but has identified certain issues regarding the Supplemental Cure Notice and the Macquarie Sale Order, including with respect to the Holdback Amount. A. As set forth in the Supplemental Niemann Declaration, 2 Macquarie has not allocated any portion of its cash Base Purchase Price to the assets it is purchasing from Waypoint Services. The amount of Waypoint Services liabilities being assumed by Macquarie far exceeds the value of that entity s assets that Macquarie is purchasing. The assets of Waypoint Services being transferred to Macquarie as well as the liabilities of Waypoint Services being assumed by Macquarie are detailed in the Supplemental Niemann Declaration. A. With respect to issues regarding the Supplemental Cure Notice, the objection is resolved pursuant to an agreement with Macquarie, whereby Macquarie has agreed to pay certain cure costs, as set forth in a revised proposed Macquarie Sale Order. The 1 Capitalized terms shall have the meanings ascribed to such terms in the Reply. 2 See Supplemental Declaration of Matthew R. Niemann in Support of Proposed Order (I) Approving Purchase Agreement Among Debtors and Macquarie, (II) Authorizing Sale of Certain of Debtors Assets Free and Clear of Liens, Claims, Encumbrances, and Other Interests, (III) Authorizing Assumption and Assignment of Certain Executory Contracts and Unexpired Leases in Connection Therewith, and (IV) Granting Related Relief, filed contemporaneously herewith (the Supplemental Niemann Declaration ). 1
Pg 5 of 13 Responses to Limited Objections to Macquarie Sale No. Debtors response with respect to the Holdback Amount is set forth in the Reply. 4. WAC8 Noteholders [ECF No. 342] 5. Lombard North Central plc, Asset Financing and Leasing [ECF No. 343] 6. Sumitomo Mitsui Banking Corporation, Brussels Branch, as WAC12 Administrative Agent [ECF No. 345] 7. Glas Trust Company LLC, as WAC3 Administrative Agent A. DIP Objection The WAC8 Noteholders support the Macquarie Sale but argue that proceeds of their collateral should not be applied to repay the DIP Facility above its Maximum Intercompany Balance (as defined in the DIP Order). B. Holdback Objection The WAC8 Noteholders object to the proposed Holdback Amount as excessive. A. Allocation Methodology Lombard does not object to the Macquarie Sale, but objects to provisions of the Macquarie Sale Order regarding allocation of expenses. Lombard states that it has relied upon the net book value allocation method as previously agreed in the DIP Order and the Bidding Procedures Order. A. Allocation Methodology Sumitomo does not object to the Macquarie Sale, but objects to provisions of the Macquarie Sale Order regarding allocation of expenses. Sumitomo states that it has relied upon the netbook value allocation method as previously agreed in the DIP Order and Bidding Procedures Order and objects to any change in methodology to the extent it would modify the Exit Payment applicable to the Streamlined Credit Bid submitted by the WAC12 Administrative Agent. A. Allocation Methodology The WAC3 Administrative Agent joins the WAC6 Administrative Agent s statement in support of the Macquarie Sale but asserts that expenses should be allocated based on the Macquarie purchase price rather than net book value. Reply. B. The Debtors response is set forth in the Reply. Reply and the Emergency Motion. Reply and the Emergency Motion. Reply and the Emergency Motion. B. The Debtors response is set forth in the Reply. 2
Pg 6 of 13 Responses to Limited Objections to Macquarie Sale No. [ECF No. 346] B. Holdback Objection Glas requests the Court approve a lower Holdback Amount. 8. Milestone Aviation Group [ECF No. 347] A. Reservation of Rights Milestone reserves its rights to object to the Macquarie Sale while it confirms that the Debtors are not transferring title or interest of any engine owned by Milestone. A. The Debtors are not transferring title to any engine owned by Milestone. 9. 1st Source Bank [ECF No. 348] 10. Macquarie PF Inc., as WAC1 Administrative Agent [ECF No. 349] 11. Wells Fargo Bank, N.A., as WAC2 Agent [ECF No. 341] A. Allocation Methodology 1st Source Bank states that it does not oppose the Macquarie Sale, but asserts that expenses should be allocated based on Macquarie s purchase price allocations rather than a net book value basis. A. Allocation Methodology Macquarie PF Inc. joins the statements filed by the WAC6 Administrative Agent and the WAC3 Administrative Agent. Macquarie PF supports the Macquarie Sale, but asserts that expenses should be allocated based on Macquarie s purchase price allocations rather than a net book value basis. B. Holdback Macquarie PF Inc. joints the WAC3 Administrative Agent s objection to the Holdback Amount. A. Reservation of Rights The WAC2 Agent filed a statement to reserve all rights with respect to the allocation of costs and expenses of the Debtors estates to the extent that approval of the Macquarie Bid may have some precedential effect on the Credit Bid submitted by the WAC2 Administrative Agent (and the sale transaction contemplated thereby, the WAC2 Sale ). Reply and the Emergency Motion. Reply and the Emergency Motion. B. The Debtors response is set forth in the Reply. 3
Pg 7 of 13 1. CHC Leasing S.A.R.L., CHC Leasing (Ireland) DAC, CHC Helicopters (Barbados) SRL, CHC Helicopters (Barbados) Limited, and Heliworld Leasing Limited ( CHC ) Responses to Cure Objections A. CHC objects to certain cure amounts in connection with the assumption of their leases and states that it intends to confer with the Debtors to reach a consensual resolution of the issues prior to sale hearing by providing additional detail and explanation regarding their cure objections. [ECF No. 279] A. The Debtors, through their conflicts counsel, are in discussion with CHC to reach a consensual resolution of the cure objection. The Debtors intend to seek an adjournment of this matter. 2. OHI Finance II, S.A., Omni Helicopters International S.A., and Omni Taxi Aereo, S.A. ( OHI ) [ECF No. 281] 3. OHI Finance II, S.A., Omni Helicopters International, S.A., and Omni Taxi Aereo, S.A. ( OHI ) [ECF No. 318] A. OHI states it has provided security deposits of at least $3.6 million in the aggregate to the Debtors and seeks to condition the assumption and assignment of certain of its leases on the transfer of the security deposits to the assignee, among other things. A. OHI maintains that its has no objection to the Macquarie sale, the WAC2 sale, and WAC9 Sale, and the WAC12 Sale, as long as, among other things, the sale orders contain provisions to refund the security deposits (as applicable), the leases are assumed and assigned (or stay with the entity whose equity is being purchased), and nothing in the bankruptcy case, any sale order, nor the APA should change the provisions of the Lease (including governing law or forum-selection clauses). B. OHI also reserves all rights with respect to helicopter 2905 while OHI and the Debtors determine the disposition of this lease. A. The Debtors are in discussions with OHI regarding a consensual resolution to their objection, but as of the filing of the Reply, OHI s objection has not been fully resolved. A. The Debtors are in discussions with OHI regarding a consensual resolution to their objection, but as of the filing of the Reply, OHI s objection has not been fully resolved. 4
Pg 8 of 13 Responses to Cure Objections 4. 19 OKH, LLC [ECF No. 332] A. 19 OKH is the owner of commercial office building in Connecticut, to which Waypoint Leasing Services, LLC is a tenant of. 19 OKH states that the cure amount to assume the office lease is $3,557.55 and not $0 as listed by the Debtors A. The Debtors have resolved 19 OKH, LLC s objection by agreeing to make certain modifications to the cure schedule. 5. AgustaWestland Malaysia Sdn. Bhd. ( AWM ) [ECF No. 335] 6. CHC Leasing S.A.R.L., CHC Leasing (Ireland) DAC, CHC Helicopters (Barbados) SRL, CHC Helicopters (Barbados) Limited, and Heliworld Leasing Limited ( CHC ) [ECF No. 351] 7. NHV, A/S f/k/a Dancopter, A/S ( NHV ) [ECF No. 353] 8. Airbus Helicopters S.A.S. and Airbus Helicopters A. AWM objects to the assumption of its leases. AWM also notes that the Debtors owe AWM $256,500 for a support contract, but that the proposed cure amount of $298,809.30 is incorrect because it includes an amount that a third-party, Capstone, is responsible for paying under the amendments to the contract. A. CHC states that it does not object to the assumption and assignment of the CHC leases, but does object to the proposed cure amount for one of the storage contracts. CHC also objects to the extent the Debtors fail to satisfy any amounts that become due and owing prior to assumption, and to the extent the Debtors seek to assume CHC leases without assuming all related agreements and contracts. A. NHV states that the Debtors have listed a lease that NHV is a party to that will be assumed, as well as six PBH side letters that will be rejected and that have a cure amount set at $0.00. NHV argues that the lease and at least one of the side letters are a single integrated agreement, so that the Debtors must choose to assume both the lease and the side letter together, and so NHV objects to the attempt to assume only the lease without the accompanying PBH side letter. A. AH disputes the cure costs listed for the Airbus helicopter contracts, AH argues that it does not object to the assumption A. The Debtors have resolved AWM s objection by agreeing to make certain modifications to the cure schedule. A. The Debtors, through conflicts counsel, are in discussion with CHC to reach a consensual resolution. The Debtors intend to seek an adjournment of this matter. A. The Debtors are in discussions with NHV regarding a consensual resolution to their objection, but as of the filing of the Reply, NHV s objection has not been fully resolved. To the extent the Debtors cannot resolve the objection, the Debtors will request an adjournment. A. The Debtors are in discussions with AH regarding a consensual resolution to their objection, but as of the filing of the Reply, 5
Pg 9 of 13 Responses to Cure Objections and assignment of its contracts, but does object to the extent that the cure cost is deficient. Deutschland GmBH ( AH ) [ECF No. 354] B. AH also objects to the extent the Debtors seek to assume contracts without all related agreements or contracts, noting that the operative documents are part of a complex integrated framework. AH s objection has not been fully resolved. To the extent the Debtors cannot resolve the objection, the Debtors will request an adjournment. 6
Pg 10 of 13 1. Macquarie Rotocraft Leasing Holdings Limited ( Macquarie ) Responses to Limited Objection to WAC9 Sale A. Break Up Fee Macquarie requests that Lombard North Central PLC, in its capacity as the WAC9 Facility Agent and the sole WAC9 Lender (the WAC9 Credit Bidder ) include broader representations under the Equity and PPN Purchase Agreement, dated as of January 25, 2019 (the WAC9 EPA ) to cover the full break-up fee protections granted to Macquarie and to name Macquarie as a third party beneficiary of such provision. (See Macquarie s proposed changes to Sections 5.09 and 12.09 of the WAC9 EPA, attached as Exhibit A to Macquarie s limited objection.) [ECF No. 339] B. NDA Rights Macquarie objects to certain restrictions and limitations set forth in the Credit Bid Documents on the NDA Rights (as defined in Macquarie s Limited Objection) being acquired by Macquarie, including the inclusion of (a) broad good-faith purchaser findings in the Debtors Proposed Sale Order, and (b) broad releases provided under the WAC9 EPA and Proposed Sale Order, and requests additional protections (in the form of representations from the WAC9 Credit Bidder regarding those NDA Rights. (See Macquarie s proposed new language in Section 5.10 and proposed modifications to Sections 12.09 and 12.24 of the WAC9 EPA, attached as Exhibit A to Macquarie s limited objection, and proposed changes set forth in paragraph J of the Proposed Sale Order, attached as Exhibit B to Macquarie s limited objection, and corresponding cross references.) C. Scope of Releases Macquarie objects to breadth of the release granted by the Debtors to the WAC9 Credit Bidder and its Representatives, including any potential release of any servicer or other thirdparty competitor and good faith findings that this Court is being asked to approve with respect to the credit bid transaction. (See Macquarie s proposed changes to Section 12.24 of the WAC9 EPA, attached as Exhibit A to Macquarie s limited objection, and proposed changes set A. Subject to the Court s approval of the WAC9 EPA, the Debtors are bound to the current terms of the WAC9 EPA; however, the Debtors are amenable to the changes to the WAC9 EPA if agreed between Macquarie and the WAC9 Credit Bidder or if the Court determines that such changes are necessary. B. Subject to the Court s approval of the WAC9 EPA, the Debtors are bound to the current terms of the WAC9 EPA. Except as set forth in Response C below, the Debtors are amenable to the changes to the WAC9 EPA and the Debtors Proposed Sale Order if agreed between Macquarie and the WAC9 Credit Bidder or if the Court determines that such changes are necessary. C. Subject to the Court s approval of the WAC9 EPA, the Debtors are bound to the current terms of the WAC9 EPA. With respect to any releases given by the Debtors to the WAC9 Credit Bidder and the other Buyer Releasing Affiliates (as defined in the WAC9 EPA), the Debtors are amenable to the changes to the WAC9 EPA and the Debtors Proposed Sale Order if agreed between Macquarie and the WAC9 Credit Bidder or if the Court determines that such changes are necessary. The Debtors reject Macquarie s proposal to limit the scope of releases being granted by the WAC9 Credit Bidder or any other Buyer Releasing Party to the Debtors and its Seller Affiliates (as defined in the WAC9 EPA) in all respects, unless Macquarie is willing to assume and indemnify the Debtors and the Seller Affiliates for such liabilities under the Macquarie APA. 7
Pg 11 of 13 Responses to Limited Objection to WAC9 Sale forth in Section 27 of the Debtors Proposed Sale Order, attached as Exhibit B to Macquarie s limited objection.) D. Third Party Beneficiary Rights Macquarie seeks third party beneficiary rights with respect to the representations contained in Section 5.09 of the WAC9 EPA and any other provisions therein that preserve rights with respect to violations of any NDAs to which the Debtor is a party (to the extent such violations affect the assets and business that Macquarie is purchasing). (See Macquarie s proposed changes to Section 12.09 of the WAC9 EPA, attached as Exhibit A to Macquarie s limited objection.) D. Subject to the Court s approval of the WAC9 EPA, the Debtors are bound to the current terms of the WAC9 EPA; however, the Debtors are amenable to the changes to the WAC9 EPA if agreed between Macquarie and the WAC 9 Credit Bidder or if the Court determines that such changes are necessary. 8
Pg 12 of 13 1. Macquarie Rotocraft Leasing Holdings Limited ( Macquarie ) Responses to Limited Objection to WAC12 Sale A. Break Up Fee Macquarie requests that Sumitomo Mitsui Banking Corporation, Brussels Branch and Sumitomo Mitsui Banking Corporation Europe Limited, each acting as WAC Facility Agents for the WAC12 Lenders (the WAC12 Credit Bidder ) include broader representations under the Credit Bid Equity Purchase Agreement, dated as of February 1, 2019 (the WAC12 EPA ) to cover the full break-up fee protections granted to Macquarie and to name Macquarie as a third party beneficiary of such provision. (See Macquarie s proposed changes to Sections 5.09 and 12.09 of the WAC12 EPA, attached as Exhibit A to Macquarie s limited objection.) [ECF No. 340] B. NDA Rights Macquarie objects to certain restrictions and limitations set forth in the Credit Bid Documents on the NDA Rights (as defined in Macquarie s Limited Objection) being acquired by Macquarie, including the inclusion of (a) broad goodfaith purchaser findings in the Debtors Proposed Sale Order, and (b) broad releases provided under the WAC12 EPA and Proposed Sale Order, and requests additional protections (in the form of representations from the WAC12 Credit Bidder regarding those NDA Rights. (See Macquarie s proposed new language in Section 5.10 and proposed modifications to Sections 12.09 and 12.24 of the WAC12 EPA, attached as Exhibit A to Macquarie s limited objection, and proposed changes set forth in paragraph J of the Proposed Sale Order, attached as Exhibit B to Macquarie s limited objection, and corresponding cross references.) C. Scope of Releases Macquarie objects to breadth of the release granted by the Debtors to the WAC12 Credit Bidder and its Representatives, including any potential release of any This objection has been resolved pursuant to certain revisions incorporated in the Proposed Sale Order and additional representations made in a supplemental declaration on behalf of the buyer. 9
Pg 13 of 13 Responses to Limited Objection to WAC12 Sale servicer or other third-party competitor and good faith findings that this Court is being asked to approve with respect to the credit bid transaction. (See Macquarie s proposed changes to Section 12.24 of the WAC12 EPA, attached as Exhibit A to Macquarie s limited objection, and proposed changes set forth in Section 27 of the Debtors Proposed Sale Order, attached as Exhibit B to Macquarie s limited objection.) D. Third Party Beneficiary Rights Macquarie seeks third party beneficiary rights with respect to the representations contained in Section 5.09 of the WAC12 EPA and any other provisions therein that preserve rights with respect to violations of any NDAs to which the Debtor is a party (to the extent such violations affect the assets and business that Macquarie is purchasing). (See Macquarie s proposed changes to Section 12.09 of the WAC12 EPA, attached as Exhibit A to Macquarie s limited objection.) 10