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Struggling helicopter co. hires GE exec as general counsel amid bankruptcy, litigation
Houston-based Bristow Group Inc., which filed for bankruptcy protection in May and is facing investor lawsuits, has hired a new in-house lawyer.
COMPANIES IN THIS ARTICLE
Bristow Group Inc.
Houston, TX
Airlines/Aviation
$1.4BRevenue
4,058Employees
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By
Olivia Pulsinelli and
Chris Mathews – Houston Business Journal
Jul 8, 2019, 2:44pm EDT
Houston-based Bristow Group Inc.,
which filed for bankruptcy protection in May and is facing some related legal issues, has hired a new in-house lawyer.
Victoria Lazar has been appointed senior vice president, general counsel and corporate secretary,
the Houston-based helicopter company announced July 1. She previously spent more than 11 years with Boston-based General Electric Co. (NYSE: GE) in Houston, most recently as general counsel of mergers and acquisitions. She also was associate general counsel for GE Oil & Gas and led the merger with Houston-based Baker Hughes Inc. to form Baker Hughes, A GE Company (NYSE: GE).
Before GE, Lazar served in various roles at Electronic Data Systems Corp., now DXC Technology, from 1996 to 2008, and she was an associate at Houston-based Baker Botts LLP from 1990 to 1996. She has a J.D. from the University of Chicago Law School and a Bachelor of Arts in government from Cornell University.
It was not immediately clear whom Lazar is replacing. According to documents filed with the U.S. Securities and Exchange Commission,
Timothy J. Knapppreviously held those roles from September 2017 until at least early August 2018.
"Victoria's extensive experience in mergers and acquisitions, market transactions and integrations will be an asset to Bristow as we emerge from our financial restructuring and look to address some of the industry's biggest challenges like market consolidation, diversification and market oversupply,"
L. Don Miller, president and CEO of Bristow, said in the release.
The change comes at a challenging time for Bristow, though the company has been making progress in some areas. The company listed total assets of $2.86 billion and total debts of nearly $1.89 billion, as well as between 1,000 and 5,000 creditors, when it filed for Chapter 11 bankruptcy protection in May. The New York Stock Exchange
began the process to delist Bristow's common stock just days later.
When the Chapter 11 filing was announced, Bristow said it had entered into a restructuring support agreement with “the overwhelming majority” of the parent company’s senior secured noteholders.
On June 28, the company announced it entered into an amended and restated agreement with certain secured and unsecured noteholders, who have also reached an updated agreement to fund a new $150 million debtor-in-possession facility. Both agreements are subject to the approval of the bankruptcy court.
"We have successfully brought together holders of both our secured notes and our unsecured notes to achieve a meaningful milestone in our reorganization, and one that positions Bristow for a timely emergence from Chapter 11," Miller said in the June 28 press release. "Upon completion of this recapitalization, we will have a much stronger balance sheet with significantly lower debt levels and improved liquidity."
However, Bristow is also involved in securities litigation and other legal matters, the company recently disclosed in some financial reports filed with the SEC. One complaint filed on June 9 with the Delaware District Court alleges that Bristow executives, board directors and former executives acted in concert with one another to allow “a course of conduct by omission and commission that was designed to and did mislead the investment public,” according to the original complaint. Plaintiffs allege that a number of statements from Bristow in press releases and public filings were materially false. The complaint goes on to claim that the director defendants “either knew or should have known of the false and misleading statements that were issued on [Bristow’s] behalf and took no steps in a good faith effort to prevent or remedy that situation.”
The complaint also alleges that Bristow's board of director defendants wasted corporate assets by, among other actions, paying excessive compensation, bonuses, termination payments and awarding self-interested stock options to certain executive officers and directors. On May 3, Bristow
issued over $2 million in executive retention payments to nine employees. Miller received a retention payment of $945,000, according to a May 7 SEC filing.
An activist investor initiated a proxy battle in April over similar issues. Wisconsin-based Global Value Investment Corp., an investment research and advisory firm and the beneficial owner of 245,940 shares of Bristow’s common stock, nominated four candidates to Bristow’s board of directors and called for the immediate resignation of four current board members.
In a public letter, GVIC listed many issues of concern, including Miller’s promotion from CFO to CEO on March 1. GVIC’s letter claims Bristow’s debt grew 53.4 percent during Miller’s tenure as CFO, which also included the planned $560 million acquisition of Oregon-based Columbia Helicopters Inc.,
which was called off in February.
Additionally, GVIC said it was concerned about the company's "inability to remedy its previously reported material weakness in internal controls over financial reporting,
yet another delay in filing the Form 10-Q for the period ended Dec. 31, 2018, and the decision to delay an interest payment" that was due in April.
Since GVIC's April letter,
Bristow has filed some of the overdue financial reports with the SEC. However,
in a June 17 filing with the SEC, Bristow said that it would be unable to file its annual report for the fiscal year ended March 31, 2019. The company intends to file its most recent annual report “as soon as practicable” after a July 10 bankruptcy court hearing to retain KPMG LLP as Bristow’s independent auditor.
Meanwhile, Bristow
announced in a May 31 press release that it had signed a five-year contract with British energy giant BP PLC (NYSE: BP) to support its North Sea operations. Bristow will service the region through bases in Aberdeen and Sumburgh, Scotland, according to the press release. That contract commenced on May 13.
For the bankruptcy process, Baker Botts LLP and Wachtell, Lipton, Rosen & Katz are serving as Bristow's legal counsel, and Alvarez & Marsal is serving as the company's restructuring adviser. Houlihan Lokey is serving as financial adviser to Bristow.
Davis Polk & Wardwell LLP is serving as legal counsel and PJT Partners is serving as financial adviser to certain holders of the secured notes. Kirkland & Ellis LLP is serving as legal counsel to certain holders of the unsecured notes, and Ducera Partners LLC and Seabury Corporate Advisors LLC are serving as financial advisers to those noteholders.