UNITED STATES BANKRUPTCY COURT EASTERN DISTRICT of VIRGINIA RICHMOND DIVISION ) in Re: ) Chapter 11 ) INTELSAT S.A., Et Al.,1 )
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Case 20-32299-KLP Doc 313 Filed 06/09/20 Entered 06/09/20 23:04:04 Desc Main Document Page 1 of 90 Brian S. Lennon (pro hac vice pending) C. Thomas Ebel (VSB No. 18637) Matthew Freimuth (pro hac vice pending) W. Ashley Burgess (VSB No. 67998) Benjamin P. McCallen (pro hac vice pending) Eric C. Howlett (VSB No. 82237) WILLKIE FARR & GALLAGHER LLP Klementina V. Pavlova (VSB No. 92942) 787 Seventh Avenue SANDS ANDERSON PC New York, New York 10019 P.O. Box 1998 Telephone: (212) 728-8000 Richmond, Virginia 23218-1998 Facsimile: (212) 728-8111 Telephone: (804) 648-1636 Facsimile: (804) 783-7291 Proposed Co-Counsel to the Special Committee Proposed Co-Counsel to the Special Committee of Intelsat Connect Finance S.A. of Intelsat Connect Finance S.A. UNITED STATES BANKRUPTCY COURT EASTERN DISTRICT OF VIRGINIA RICHMOND DIVISION ) In re: ) Chapter 11 ) INTELSAT S.A., et al.,1 ) Case No. 20-32299 (KLP) ) Debtors. ) (Jointly Administered) ) APPLICATION OF INTELSAT CONNECT FINANCE S.A. TO RETAIN ANKURA CONSULTING GROUP, LLC AS FINANCIAL ADVISOR TO THE SPECIAL COMMITTEE OF INTELSAT CONNECT FINANCE S.A. EFFECTIVE AS OF JUNE 1, 2020 Intelsat Connect Finance S.A. (“Intelsat Connect”), one of the above-captioned debtors and debtors in possession (the “Debtors”), respectfully states as follows in support of this application (this “Application”):2 1 Due to the large number of Debtors in these chapter 11 cases, for which joint administration has been granted, a complete list of the Debtor entities and the last four digits of their federal tax identification numbers is not provided herein. A complete list may be obtained on the website of the Debtors’ claims and noticing agent at https://cases.stretto.com/intelsat. The location of the Debtors’ service address is: 7900 Tysons One Place, McLean, VA 22102. 2 The detailed description of the Debtors and their business, and the facts and circumstances supporting the Debtors’ chapter 11 cases, are set forth in greater detail in the Declaration of David Tolley, Executive Vice President, Chief Financial Officer, and Co-Restructuring Officer of Intelsat S.A., in Support of Debtors’ Chapter 11 Petitions and First Day Motions [Docket No. 6] (the “First Day Declaration”), filed contemporaneously with the Debtors’ voluntary petitions for relief filed under chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”) on May 13, 2020 (the “Petition Date”). Capitalized terms used but not otherwise defined in this Application shall have the meanings ascribed to them in the First Day Declaration or as later defined herein, as applicable. Case 20-32299-KLP Doc 313 Filed 06/09/20 Entered 06/09/20 23:04:04 Desc Main Document Page 2 of 90 Relief Requested 1. By this Application, Intelsat Connect requests the authority, pursuant to sections 327 and 328 of the Bankruptcy Code to retain and employ Ankura Consulting Group, LLC (“Ankura”) effective as of June 1, 2020 (the “Engagement Date”) to serve as financial advisors to the special committee of the board of directors of Intelsat Connect (the “Special Committee”). 2. Intelsat Connect requests that the Court approve the retention and employment of Ankura in accordance with the terms and conditions set forth in the engagement letter between Intelsat Connect, the Special Committee and Ankura, dated June 1, 2020, a copy of which is annexed hereto as Exhibit 1 (the “Engagement Letter”) to the proposed form of order granting the relief requested herein attached to the Application as Exhibit A (the “Proposed Order”). Pursuant to the terms and conditions of the Engagement Letter, Ankura will provide financial advisory services, and the professionals retained pursuant to the Engagement Letter (the “Ankura Professionals”) will report solely to the Special Committee. 3. In support of this Application, Intelsat Connect submits the declaration of Philip J. Gund, which is annexed hereto as Exhibit B (the “Gund Declaration”). Jurisdiction and Venue 4. The United States Bankruptcy Court for the Eastern District of Virginia (the “Court”) has jurisdiction over this matter pursuant to 28 U.S.C. §§ 157 and 1334 and the Standing Order of Reference from the United States District Court for the Eastern District of Virginia, dated August 15, 1984. Intelsat Connect confirms its consent, pursuant to rule 7008 of the Bankruptcy Rules, to the entry of a final order by the Court in connection with this Application to the extent that it is later determined that the Court, absent consent of the parties, cannot enter - 2 - Case 20-32299-KLP Doc 313 Filed 06/09/20 Entered 06/09/20 23:04:04 Desc Main Document Page 3 of 90 final orders or judgments in connection herewith consistent with Article III of the United States Constitution. 5. Venue is proper in this district pursuant to 28 U.S.C. §§ 1408 and 1409. 6. The bases for the relief requested herein are sections 327(a) and 328(a) of the Bankruptcy Code, Bankruptcy Rules 2014(a) and 2016(a), and rules 2014-1 and 2016-1 of the Local Rules of the United States Bankruptcy Court for the Eastern District of Virginia (the “Local Bankruptcy Rules”). Background 7. The Debtors (together with their non-Debtor affiliates, the “Company”) operate one of the world’s largest satellite services businesses, providing a critical layer in the global communications infrastructure. As the foundational architects of satellite technology, the Company operates the largest satellite fleet and connectivity infrastructure in the world. 8. Through its global and extra-terrestrial network of satellites and teleports, the Company provides diversified communications services to the world’s leading media companies, fixed and wireless telecommunications operators, data networking service providers for enterprise and mobile applications in the air and on the seas, multinational corporations and internet service providers in the most challenging and remote locations across the globe. The Company is also the leading provider of commercial satellite communication services to the U.S. government and other select military organizations and their contractors. The Company’s administrative headquarters are in McLean, Virginia, and the Company has extensive operations spanning across the United States, Europe, South America, Africa, the Middle East, and Asia. 9. On the Petition Date, the Debtors filed voluntary petitions for relief under chapter 11 of the Bankruptcy Code. The Debtors are operating their business and managing their properties as debtors in possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. - 3 - Case 20-32299-KLP Doc 313 Filed 06/09/20 Entered 06/09/20 23:04:04 Desc Main Document Page 4 of 90 On May 15, 2020, the Court entered an order granting procedural consolidation and joint administration of these chapter 11 cases pursuant to Bankruptcy Rule 1015(b). The Ankura Professionals 10. Pursuant to the resolutions of the board of directors of Intelsat Connect (the “Board of Directors”) dated March 27, 2020 (the “Resolutions”), two disinterested directors (the “Disinterested Directors”) were appointed to the Board of Directors and the Special Committee was established. The Disinterested Directors were appointed to the Special Committee effective April 1, 2020, and constitute the sole members of the Special Committee. 11. The Special Committee has been delegated certain authority, which includes: (a) the tasks of reviewing, negotiating, evaluating, and approving strategic transactions (a “Transaction”); and (b) certain rights, authority, and powers in connection with matters pertaining to a Transaction in which the Special Committee determines in whole or in part may result in Conflict Matters, as defined in the Resolutions (the “Conflict Matters”). The Special Committee’s work in connection with any and all Conflict Matters and in connection with reviewing Transactions (collectively, the “Independent Analysis”) remains open and will continue during the pendency of these chapter 11 cases. To assist the Special Committee in fulfilling its duties under the Resolutions and conducting the Independent Analysis, Intelsat Connect seeks to retain Ankura pursuant to the Engagement Letter, to render independent financial advisory services at the sole direction of the Special Committee. 12. In consideration of the size and complexity of their business, as well as the exigencies of the circumstances, Intelsat Connect and Special Committee have determined that the services of experienced financial advisors will substantially enhance their attempts to maximize the value of the Intelsat Connect estate. The Ankura Professionals are well qualified to act on the - 4 - Case 20-32299-KLP Doc 313 Filed 06/09/20 Entered 06/09/20 23:04:04 Desc Main Document Page 5 of 90 Special Committee’s behalf, given their extensive knowledge and expertise with respect to chapter 11 proceedings. 13. Ankura is a business advisory and expert services firm whose professionals have significant experience in providing bankruptcy crisis management and consulting, and special financial advisory services. Ankura’s professionals have provided strategic advice to debtors in numerous chapter 11 cases of similar size and complexity as these chapter 11 cases. Ankura has provided restructuring or crisis management services in numerous bankruptcy cases, including: In re High Ridge Brands Co., Case No. 19-12689 (BLS) (Bankr. D. Del. Dec. 18, 2019); In re Emerge Energy Services LP, Case No. 19-11563 (KBO) (Bankr. D. Del. July 15, 2019); In re Payless Holdings LLC, Case No. 19-40883-659 (Bankr. E.D.M.O. Feb. 18, 2019); In re Trident Holding Company, LLC., Case No. 19-10384 (SHL) (Bankr. S.D.N.Y. Feb. 10, 2019); In re Fallbrook Technologies Inc., Case No. 18-10384 (MFW) (Bankr. D. Del. Feb. 26, 2018); In re SunEdison, Inc., Case No. 16-10992 (SMB) (Bankr. S.D.N.Y. Aug. 11, 2016). 14. The Ankura Professionals specialize in interim management, restructuring advisory, turnaround consulting, operational due diligence, creditor advisory services, forensic accounting, and performance improvement.