Item 7.01 Regulation FD Disclosure.
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
Amended Plan
On December 19, 2016, the Debtors filed
a second amended joint chapter 11 plan (the “
Amended Plan
”). The Amended Plan, among other things, reflects
revisions to the section of the plan dealing with the cancellation of certain of the Debtors’ existing agreements and the
provision of a new exit revolving facility with the Debtors’ existing revolving credit facility lenders. A copy of the Amended
Plan is filed herewith as
Exhibit 99.1
and incorporated herein by reference, and the foregoing description is qualified
in its entirety by reference to the Amended Plan.
Revised Proposed Disclosure Statement
On December 19, 2016, the Debtors filed
a second revised proposed disclosure statement (the “
Revised Proposed Disclosure Statement
”) with the Bankruptcy
Court. The Revised Proposed Disclosure Statement includes, among other things, revision reflecting the agreed material terms of
the exit revolving credit facility and certain other changes reflecting recent developments in the Chapter 11 Cases. A copy of
the Revised Proposed Disclosure Statement is filed herewith as
Exhibit 99.2
and incorporated herein by reference, and the
foregoing description is qualified in its entirety by reference to the Revised Proposed Disclosure Statement.
In accordance with General Instruction
B.2 to Form 8-K, the information provided under this Item 7.01 shall be deemed to be “furnished” and shall not be deemed
to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to
the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933,
as amended.
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 and execution of our restructuring 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 during the pendency of our court proceedings.
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: we filed for protection under Chapter 11 of the Bankruptcy Code and are subject
to risks and uncertainties; our ability to implement the Plan and to obtain Bankruptcy Court approval with respect to motions in
the Chapter 11 proceedings prosecuted from time to; operating under Chapter 11 may restrict our ability to pursue our business
strategies; our employees face considerable uncertainty due to the Chapter 11 proceedings; we may suffer from a protracted restructuring;
our ability to emerge from Chapter 11 and operate profitably thereafter 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, due to our
current Chapter 11 proceedings, may not be able to obtain any equity or debt financings in the capital markets for the foreseeable
future; we may be subject to claims that will not be discharged in the Chapter 11 proceedings; our restructuring efforts through
the Chapter 11 proceedings may be expensive, take resources and distract management; we are in the process of rejecting and abandoning
a significant portion of our helicopter fleet through 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 have been
prepared assuming that we will continue as a going concern, our independent registered public accounting firm has raised substantial
doubts about our ability to continue as a going concern, and we have not included any adjustments that might result from the outcome
of this uncertainty; 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, the capital and banking markets or a prolonged period in Chapter 11 proceedings 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;
in the event we are or become treated as a passive foreign investment company, or PFIC, for U.S. federal income tax purposes, our
U.S. shareholders could be subject to adverse U.S. federal income tax consequences; we are controlled by a shareholder group, which
might have interests that conflict with ours or the interests of our other shareholders; due to our Chapter 11 bankruptcy proceedings,
our ordinary shares may have no value and any investment in our shares is highly speculative; the market for our ordinary shares
historically has experienced significant price and volume fluctuations; we have not paid dividends on our ordinary shares historically
and may not pay any cash dividends on our ordinary or preferred shares for the foreseeable future; pursuant to the terms of the
preferred shares, which rank senior to our ordinary shares, we are required to pay regular cash dividends or issue shares in respect
of amounts accrued as dividends on the preferred shares, and we may be required under certain circumstances to repurchase the preferred
shares; we are currently unable to pay such obligations while we are in Chapter 11 proceedings and are likely not to pay any cash
dividends for the foreseeable future; our preferred shares have rights, preferences and privileges that are not held by, and are
preferential to the rights of, holders of our ordinary shares. Such preferential rights could adversely affect our liquidity and
financial condition, and may result in the interests of the holders of our preferred shares differing from those of the holders
of our ordinary shares; we are a holding company and, accordingly, are dependent upon distributions from our subsidiaries to generate
the funds necessary to meet our financial obligations and pay dividends; the requirements of being a public company may strain
our resources and distract our management; provisions of our articles of association and Cayman Islands corporate law may discourage
or prevent an acquisition of us which could adversely affect the value of our ordinary shares; our organizational documents contain
a variety of anti-takeover provisions that could delay, deter or prevent a change in control; shareholder rights under Cayman Islands
law may differ materially from shareholder rights in the United States, which could adversely affect the ability of us and our
shareholders to protect our and their interests; as a shareholder, you might have difficulty obtaining or enforcing a judgment
against us because we are incorporated under the laws of the Cayman Islands; our major investors, Clayton, Dubilier & Rice
and First Reserve Management, L.P., may compete with us, and our articles of association contain a provision that expressly permits
our non-employee directors to compete with us; 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 efforts to effectively reorganize
under Chapter 11 of the Bankruptcy Code 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.