CHC GROUP LTD. (OTCMKTS:HELIQ) Files An 8-K Bankruptcy or Receivership

CHC GROUP LTD. (OTCMKTS:HELIQ) Files An 8-K Bankruptcy or Receivership

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Item 1.03 Bankruptcy or Receivership.

As previously reported, on May 5, 2016, CHC Group Ltd. (the
Company) and certain of its subsidiaries
(together with the Company, the Debtors) filed
voluntary petitions in the United States Bankruptcy Court for the
Northern District of Texas (the Bankruptcy
Court
), seeking relief under Chapter 11 of Title 11 of
the United States Code (the Bankruptcy Code). As
previously reported, on November 11, 2016, the Debtors filed
their joint chapter 11 plan and the related disclosure statement
with the Bankruptcy Court and on December 5, 2016, the Debtors
filed an amended joint chapter 11 plan and a related revised
disclosure statement with the Bankruptcy Court.

On December 19, 2016, the Debtors filed a second amended joint
chapter 11 plan, as amended by third amended joint chapter 11
plan filed on February 8, 2017 and as further amended by fourth
amended joint chapter 11 plan filed on February 15, 2017 (as
amended, the Plan).

On January 22, 2017, the Company filed a plan supplement (the
Plan Supplement) with the Bankruptcy Court as
contemplated by the Plan. A First Amendment to the Plan
Supplement was filed with the Bankruptcy Court on February 8,
2017. A hearing on confirmation of the Plan was held on February
13 and 14, 2017, at the conclusion of which the Bankruptcy Court
requested additional briefing from the parties regarding
arguments by certain plan objectors. The Company reached a
settlement with plan objector ECN Aviation Capital on February
28, 2017, upon which ECN Aviation Capital changed its vote from
rejecting to accepting the Plan.

Confirmation of Plan

At a hearing on March 3, 2017, the Bankruptcy Court approved the
Debtors settlement with ECN Aviation Capital, overruled all
remaining plan objections and entered an order confirming the
Plan (the Confirmation Order). A copy of the
Confirmation Order, with a copy of the Plan as confirmed attached
thereto, is attached as Exhibit 2.1 to this Current Report on
Form 8-K and is incorporated herein by reference. A copy of the
press release announcing the confirmation of the Plan is attached
as Exhibit 99.1 to this Current Report on Form 8-K.

Summary of Plan

The following is a summary of the transactions that will occur on
the Effective Date to the Plan. This summary only highlights
certain of the substantive provisions of the Plan and is not
intended to be a complete description of, or a substitute for a
full and complete reading of, the Plan. This summary is qualified
in its entirety by reference to the full text of the Plan. Any
capitalized term not herein defined shall have the meaning
ascribed to such term in the Plan.

to the Plan, on the Effective Date:

The Exit Revolving Credit Facility Documents necessary to
effectuate the treatment of the Revolving Credit Agreement
Claims shall be executed and delivered, and the Reorganized
Debtors shall be authorized to execute, deliver and enter
into the Exit Revolving Credit Facility Documents.
The Amended and Restated ABL Credit Facility Documents shall
be executed and delivered.
Reorganized CHC will issue the New Membership Interests,
other than the New Membership Interests to be issued
following the Effective Date in accordance with the
Confirmation Order.
Reorganized Debtors and the New Second Lien Convertible Notes
Indenture Trustee will enter into the New Second Lien
Convertible Notes Indenture substantially in the form
contained in the Plan Supplement and Reorganized CHC and the
co-issuer under the New Second Lien Convertible Notes
Indenture will issue the New Second Lien Convertible Notes
for an aggregate subscription price of $300 million.
The Reorganized Debtors and the New Unsecured Notes Indenture
Trustee will enter into the New Unsecured Notes Indenture
substantially in the form contained in the Plan Supplement,
and the New Unsecured Notes will also be issued following the
Effective Date in accordance with the Confirmation Order.

Reorganized CHC and all the holders of the New Membership
Interests then outstanding shall be deemed to be parties to
the Reorganized CHC Operating Agreement.
Except as expressly provided therein, all notes, instruments,
certificates evidencing debt of, or Interests in, the
Debtors, including the Revolving Credit Agreement, the ABL
Credit Agreement, the Senior Secured Notes, the Senior
Secured Notes Indenture, the Unsecured Notes, the Unsecured
Notes Indenture, the Existing CHC Interests, and all options
and other entitlements to purchase and/or receive Existing
CHC Interests, shall be deemed surrendered and cancelled and
obligations of the Debtors thereunder shall be discharged;
provided, however that any surrender and/or
cancellation of the notes, instruments and certificates
evidencing debt of, or Interests in, the Debtors shall only
be with respect to the Debtors and Reorganized Debtors and
shall not alter the rights or obligations of any parties
other than the Debtors or their non-debtor affiliates
vis–vis one another with respect to such agreement.

Item 3.03 Material Modification to Rights of Security
Holders.

As provided in the Plan, except as expressly provided therein, on
the Effective Date, all notes, instruments, certificates
evidencing debt of, or Interests in, the Debtors, including the
Revolving Credit Agreement, the ABL Credit Agreement, the Senior
Secured Notes, the Senior Secured Notes Indenture, the Unsecured
Notes, the Unsecured Notes Indenture, the Existing CHC Interests,
and all options and other entitlements to purchase and/or receive
Existing CHC Interests, shall be deemed surrendered and cancelled
and obligations of the Debtors thereunder shall be discharged.

Item 5.02 Departure of Directors or Certain Officers;
Election of Directors; Appointment of Certain Officers;
Compensatory Arrangements of Certain Officers.

As provided in the Plan, Reorganized CHC will have a new board of
managers made up of five members who will be appointed on the
Effective Date, one of whom will be the chief executive officer
of Reorganized CHC, Karl Fessenden.

Cautionary Note Regarding Forward-Looking Statements

This Form 8-K, accompanying exhibits, and other statements that
we may make, contain forward-looking statements. Forward-looking
statements are statements that are not historical facts and
include statements about our expectations for the timing of the
effective date of the Plan, our future financial condition and
future business plans and expectations, the effect of, and our
expectations with respect to, the operation of our business,
adequacy of financial resources and commitments and operating
expectations following our emergence from Chapter 11. Such
forward-looking statements are based upon the current beliefs and
expectations of our management, but are subject to risks and
uncertainties, which could cause actual results and/or the timing
of events to differ materially from those set forth in the
forward-looking statements, including, among others: our ability
to implement the Plan as confirmed by the Bankruptcy Court; our
ability to operate profitably after emerging from Chapter 11 will
depend on increasing our revenue, lowering our costs, and
obtaining sufficient financing or other capital to operate
successfully; we have substantial liquidity needs and may not be
able to obtain any equity or debt financings in the capital
markets on terms that are attractive or at all in the event that
the cash proceeds from the issuance and sale of second-lien
convertible notes to the rights offering under the Plan, together
with the additional asset based financing commitments from The
Milestone Aviation Group Limited and its affiliates, are
insufficient to meet our liquidity needs ; we may be subject to
claims that remain disputed even after emergency from Chapter 11
or will not be discharged in the Chapter 11 proceedings; we have
rejected and abandoned a significant portion of our helicopter
fleet through our Chapter 11 proceedings, which may result in an
inability to quickly respond to new opportunities and a
significant loss of market share and profit margins; our
consolidated financial statements going forward will be prepared
on the basis of fresh-start accounting and thus may not be
comparable with our historical consolidated financial statements;
we have a history of net losses; our substantial level of
indebtedness, operating lease commitments, purchase and other
commitments could materially adversely affect our ability to
fulfill our obligations under our debt agreements, our ability to
react to changes in our business and our ability to incur
additional debt to fund future needs; all flights with the
aircraft type H225 and AS332 L2 have been temporarily grounded
which may cause a material and adverse impact to our financial
viability; operating helicopters involves a degree of inherent
risk and we are exposed to the risk of losses from safety
incidents; if we are unable to mitigate potential losses through
a robust safety management and insurance coverage program, our
financial condition would be jeopardized in the event of a safety
or other hazardous incident; failure to maintain standards of
acceptable safety performance could have an adverse impact on our
ability to attract and retain customers and could adversely
impact our reputation, operations and financial performance; our
operations are largely dependent upon the level of activity in
the offshore oil and gas industry; the oil and gas industries on
which we are largely dependent are suffering through a severe
downturn, resulting in significant negative impact on demand for
our services, and no assurance can be given that the downturn
will not continue to be prolonged; many of the markets in which
we operate are highly competitive, and if we are unable to
effectively compete, it may result in a loss of market share or a
decrease in revenue or profit margins; we rely on a limited
number of large offshore helicopter support contracts with a
limited number of customers. If any of these are terminated early
or not renewed, our revenues could decline; negative publicity
may adversely impact us; our fixed operating expenses and
long-term contracts with customers could adversely affect our
business under certain circumstances; we depend on a small number
of helicopter manufacturers and any safety issues can severely
limit our ability to continue operating helicopters already in
our fleet; we depend on a limited number of third-party suppliers
for helicopter parts and subcontract services; restructuring of
our operations and organizational structure may lead to
significant costs; our business requires substantial capital
expenditures, lease and working capital financing, which we are
currently blocked from accessing through the capital markets and
banks. Any further deterioration of current industry or business
conditions or the capital and banking markets generally could
adversely impact our business, financial condition and results of
operations; we rely on the secondary used helicopter market to
dispose of our older helicopters and parts due to our ongoing
fleet modernization efforts; our operations are subject to
extensive regulations which could increase our costs and
adversely affect us; our maintenance, repair and overhaul (MRO)
business, Heli-One, could suffer if licenses issued by original
equipment manufacturers (OEMs) and/or governmental authorities
are not renewed or we cannot obtain additional licenses; we
derive significant revenue from non-wholly owned variable
interest entities. If we are unable to maintain good relations
with the other owners of such non-wholly owned entities, our
business, financial condition or results of operations could be
adversely affected; our operations may suffer due to political,
regulatory, commercial and economic uncertainty; our business in
countries with a history of corruption and transactions with
foreign governments increases the compliance risks associated
with our international activities; we are subject to extensive
federal, state, local and foreign environmental, health and
safety laws, rules, regulations and ordinances that could have an
adverse impact on our business; we are subject to many different
forms of taxation in various jurisdictions throughout the world,
which could lead to disagreements with tax authorities regarding
the application of tax laws; the offshore helicopter services
industry is cyclical; we are exposed to foreign currency risks;
our failure to hedge exposure to fluctuations in foreign currency
exchange rates effectively could unfavorably affect our financial
performance; we are exposed to credit risks; our customers may
seek to shift risk to us; if oil and gas companies undertake cost
reduction methods, there may be an adverse effect on our
business; reductions in spending on helicopter services by
government agencies could lead to modifications of search and
rescue (SAR) and emergency medical services (EMS) contract terms
or delays in receiving payments, which could adversely impact our
business, financial condition and results of operations; failure
to develop or implement new technologies and disruption to our
systems could affect our results of operations; we rely on
information technology, and if we are unable to protect against
service interruptions, data corruption, cyber-based attacks or
network security breaches, our operations could be disrupted and
our business could be negatively affected; the loss of key
personnel could affect our growth and future success; labor
problems could adversely affect us; if the assets in our defined
benefit pension plans are not sufficient to meet the plans’
obligations, we could be required to make substantial cash
contributions and our liquidity could be adversely affected;
adverse results of legal proceedings could materially and
adversely affect our business, financial condition or results of
operations; upon the effective date of the plan, the issued and
outstanding ordinary shares of CHC will have no value we have not
paid dividends on our ordinary shares historically and may not
pay any cash distributions on our common units in the future; and
other risks and uncertainties detailed from time to time in our
filings with the Securities and Exchange Commission, including
the Company’s Annual Report on Form 10-K for the year ended
April 30, 2016. The Company’s filings with the Securities and
Exchange Commission are available at www.sec.gov. You are urged
to consider these factors carefully in evaluating the
forward-looking statements herein and are cautioned not to place
undue reliance on such forward-looking statements, which are
qualified in their entirety by this cautionary statement. The
forward-looking statements speak only as of the date on which
they are made and the Company undertakes no obligation to
publicly update such forward-looking statements to reflect
subsequent events or circumstances. No assurances can be given
that our emergence from Chapter 11 will ultimately be successful
or that we will succeed in strengthening our balance sheet or
increase our financial flexibility. Should one or more of these
risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual outcomes may vary materially
from those indicated.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

2.1

Order of the Bankruptcy Court, dated March 3, 2017,
confirming the Fourth Amended Joint Chapter 11 Plan of CHC
Group Ltd. and its Affiliated Debtors

99.1 Press Release


About CHC GROUP LTD. (OTCMKTS:HELIQ)

CHC Group Ltd., formerly FR Horizon Holding (Cayman) Inc., is a commercial operator of helicopters. The Company operates through two segments: Helicopter Services and Heli-One. The Helicopter Services segment consists of flying operations in the North Sea, the Americas, the Asia Pacific region and the Africa-Euro Asia region, primarily serving its offshore oil and gas customers, in addition to providing search and rescue (SAR), and emergency medical services (EMS) to government agencies, and oil and gas customers. The Heli-One segment includes helicopter maintenance, repair and overhaul (MRO) facilities in Norway, Poland, Canada and the United States, providing services for its fleet and for its external customer base in Europe, Asia and North America. Its MRO services include maintenance outsourcing solutions, engineering services and logistics support. The Heli-One operations have facilities in Delta, British Columbia; Stavanger, Norway; Fort Collins, Colorado, and Rzeszow, Poland.

CHC GROUP LTD. (OTCMKTS:HELIQ) Recent Trading Information

CHC GROUP LTD. (OTCMKTS:HELIQ) closed its last trading session up +0.053 at 0.373 with shares trading hands.

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