Case 24-10628-KBO Doc 531-1 Filed 07/15/24 Page 1 of 7
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`EXHIBIT 1
`Settlement Agreement
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`RLF1 31141621v.1
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`Case 24-10628-KBO Doc 531-1 Filed 07/15/24 Page 2 of 7
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`WOM S.A., et. al.
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`SETTLEMENT TERM SHEET
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`June 21, 2024
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`TERMS
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`Parties
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`Settlement
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`Pending Matters
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`• The debtors in the above-captioned chapter 11 cases (the “Debtors”)
`• The official committee of unsecured creditors appointed in the above-captioned
`chapter 11 cases (the “Committee”)
`• Ad Hoc Group of WOM Noteholders (the “Ad Hoc Group”)
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`Each of the Parties hereto represents that the applicable undersigned signatory is duly
`authorized to execute this Settlement Term Sheet on such Party’s behalf.
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`This settlement term sheet (the “Settlement Term Sheet”) describes the terms of the
`settlement (the “Settlement”) that, subject to Court approval, resolves, among other
`things, the Motion of the Ad Hoc Group of WOM Noteholders for an Order Dismissing
`the Debtors’ Chapter 11 Cases Under Sections 305(a) and 1112(b) of the Bankruptcy
`Code and for Lack of Jurisdiction, or, in the Alternative, Appointing a Chapter 11 Trustee
`[D.I. 143] (the “Motion to Dismiss”) filed by the Ad Hoc Group, and all objections filed
`by the Ad Hoc Group in these Chapter 11 Cases at Docket Numbers 252, 253 (the
`“Foreign Vendor Objection”), 260, 331, 332, and 358 (together with the Foreign
`Vendor Objection, the “Pending Objections”).
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`The Settlement will be subject to approval of the Bankruptcy Court under Rule 9019 of
`the Federal Rules of Bankruptcy Procedure. The Parties will work in good faith to obtain
`approval of the Settlement as expeditiously as possible, but in no event later than July 15,
`2024 (as may be extended from time to time by agreement of the Ad Hoc Group (the
`“Settlement Termination Date”), through one or more orders of the Bankruptcy Court
`(such order, the “Settlement Order”).
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`The Ad Hoc Group agrees to withdraw (i) on a final basis, each of the Pending Objections
`other than the Foreign Vendor Objection, as of the date hereof, provided that the orders
`granting the motions that are subject to the Pending Objections shall contain the
`Reservation of Rights Language1 and (ii) on a final basis, the Foreign Vendor Objection
`and, with prejudice, the Motion to Dismiss immediately upon payment by the Debtors of
`the Ad Hoc Group Professional Fees in accordance with this Settlement Term Sheet.
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`1 The “Reservation of Rights Language” is (as conformed for the applicable Final Order, including, without limitation, the
`addition of the DIP Agent to clause (ii)) is as follows:
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`Notwithstanding anything else herein, this Final Order is without prejudice to (i) the Ad Hoc Group’s motion
`to dismiss these Chapter 11 Cases [Docket No. 143] (the “Motion to Dismiss”), (ii) any rights and defenses
`of the Debtors, or any rights, defenses, or claims of the Ad Hoc Group of WOM Bondholders or the
`Committee, with respect to the Motion to Dismiss are fully preserved and reserved, and (iii) no party may
`rely on entry of this Final Order as grounds for denial of the Motion to Dismiss.
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`RLF1 31130727v.2
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`Bidding Procedures
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`The Debtors shall file with the Bankruptcy Court a Third Interim Order (I) Authorizing
`the Debtors to (A) Pay Foreign Vendor Claims, Interconnection Claims, and Refund
`Claims and (B) Continue Other Customer Programs and (II) Granting Related Relief
`promptly following execution of this Settlement Term Sheet, which shall define the
`“Interim Cap” as an aggregate amount not to exceed $52.5 million.
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`The hearing on the Motion to Dismiss shall be rescheduled for July 19, 2024 (the
`“Rescheduled MTD Hearing”) or as otherwise agreed in writing by the Parties, subject
`to the Bankruptcy Court’s availability. Upon entry of the Settlement Order and the
`confirmation by the Special Committee that the reasonable and documented Ad Hoc
`Group Professional Fees shall be paid by the Debtors, the Rescheduled MTD Hearing
`shall be continued for seven (7) days to allow for such payment and upon payment by the
`Debtors of the Ad Hoc Group Professional Fees, the Rescheduled MTD Hearing shall be
`cancelled. Unless otherwise agreed by the Parties hereto, if by the Settlement
`Termination Date, the Settlement Order has not been entered and the Special Committee
`has not confirmed that the Ad Hoc Group Professional Fees shall be paid, then the
`Rescheduled MTD Hearing will go forward as scheduled.
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`Subject to approval of the Bankruptcy Court, the Debtors will conduct the marketing
`process described in the Motion for Entry of an Order (I)(A) Approving Bidding
`Procedures, (B) Scheduling Certain Dates with Respect Thereto, (C) Approving the Form
`and Manner of Notice Thereof, (D) Authorizing the Designation of a Stalking Horse
`Bidder, (E) Scheduling a Transaction Hearing, and (F) Approving Procedures for the
`Assumption and Assignment of Executory Contracts and Unexpired Leases and (II)
`Granting Related Relief [D.I. 365] (the “Bidding Procedures Motion”),2 with the goal
`of maximizing the present value of the Debtors’ assets for the benefit of the Debtors, their
`estates and their creditors.
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`The Special Committee will, in evaluating Qualified Bids, consider all relevant factors,
`including (without limitation) execution risk, the form(s) of consideration constituting
`such Qualified Bids, the marketability of such consideration and the present value of such
`consideration at market rates under prevailing market conditions.
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`The members of the Ad Hoc Group may participate in the marketing process as Potential
`Bidders and the Debtors will act in good faith to afford the Ad Hoc Group’s professionals
`that are subject to confidentiality agreements the time and opportunity to conduct due
`diligence as set forth in the Bidding Procedures, including giving such professionals
`access to the same due diligence materials provided to Acceptable Bidders. The Debtors
`shall provide members of the Ad Hoc Group who wish to participate in the marketing
`process a summarized version of the due diligence materials, consistent with customary
`market practice regarding the level of detail provided in such summary materials;
`provided that such members of the Ad Hoc Group shall have executed one or more
`confidentiality agreements that are subject to disclosure requirements prior to the receipt
`thereof.
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`The members of the Ad Hoc Group and their professionals shall be permitted to discuss
`the terms of any Bid with any Potential Bidder (such discussion, a “Joint Bid
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`2 Capitalized terms used and not otherwise defined in this section shall have the meanings ascribed to such terms in the Bidding
`Procedures Motion.
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`RLF1 31130727v.2
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`Related Party
`Claims
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`AHG Professional
`Fees
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`Discussion”) no earlier than two (2) Business Days3 following the provision of written
`notice (which may be an email) to counsel to the Special Committee (acting on behalf of
`the Debtors); provided that the Special Committee shall be afforded the opportunity to
`consult on and object in writing (which may be an email) within such two (2) Business
`Day period to any Joint Bid Discussion; provided, further that, in the event the Special
`Committee raises (whether formally or informally) an objection in writing (which may
`be an email) within such two (2) Business Day period to any Joint Bid Discussion (x) the
`Ad Hoc Group shall be entitled to seek an emergency hearing before this Court as soon
`as the Court’s availability permits to rule on whether such Joint Bid Discussion would be
`appropriate and (y) none of the members of the Ad Hoc Group nor their professionals
`shall be permitted to have a Joint Bid Discussion until the Special Committee consents
`(in writing) thereto or such Joint Bid Discussion is approved by the Bankruptcy Court.
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`The Debtors agree that any chapter 11 plan that they file will provide that, on the effective
`date of such plan, any and all claims and causes of action of the Debtors’ estates, the
`review, investigation, and analysis of which has been delegated to the Special Committee,
`shall be placed into a trust for the benefit of the Debtors’ estates, except for any such
`claims and causes of action that (a) have been settled by the Special Committee or (b) the
`Special Committee determines should not be pursued.
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`In consideration for the Ad Hoc Group’s agreement to withdraw the Motion to Dismiss
`and the Pending Objections, the Debtors agree to pay, subject to the approval of the
`Bankruptcy Court, the reasonable and documented fees and expenses of the Ad Hoc
`Group’s professionals (listed below),4 incurred as of the date of entry of the Settlement
`Order (including such amounts arising prior to the date of filing of the Debtor’s chapter
`11 cases, but excluding any (i) fees and expenses incurred by the Ad Hoc Group’s
`professionals incurred in connection with further prosecution of the Motion to Dismiss
`and the Foreign Vendor Motion from and after June 21, 2024 through the date of entry of
`the Settlement Order and (ii) prospective success fees, transaction fees or similar fees of
`Ducera Partners LLC (“Ducera”)):
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`- Dechert LLP;
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`- Ducera;
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`- Bofill Mir Abogados;
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`- Young Conaway Stargatt & Taylor, LLP; and
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`- Werb & Sullivan (collectively, the “Ad Hoc Group Professional Fees”).
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`The Ad Hoc Group shall not be required to file fee applications or comply with the U.S.
`Trustee Guidelines with respect to the Ad Hoc Group Professional Fees. Invoices for Ad
`Hoc Group Professional Fees shall be in the form of invoice summaries for professional
`fees and categorized expenses, and such invoice summary shall not be required to contain
`time entries, but shall include a general, brief description of the nature of the matters for
`which services were performed, and which may be redacted or modified to the extent
`necessary to delete any information subject to the attorney-client privilege, any work
`product doctrine, privilege or protection, common interest doctrine privilege or
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`“Business Day” shall mean any day (other than a Saturday or Sunday) on which banks are open for business in New York City
`and Santiago, Chile.
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`4 The Debtors understand that such fees are approximately USD10 million as of the date hereof.
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`RLF1 31130727v.2
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`protection, any other evidentiary privilege or protection recognized under applicable law,
`or any other confidential information, and the provision of such invoices shall not
`constitute any waiver of the attorney-client privilege, work product doctrine, privilege or
`protection, common interest doctrine privilege or protection, or any other evidentiary
`privilege or protection recognized under applicable law.
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`The Ad Hoc Group shall retain all rights to submit one or more applications for the
`approval of the Ad Hoc Group Professional Fees and expenses of the Ad Hoc Group’s
`advisors not paid pursuant to the Settlement under section 503(b)(3) and (4) of the
`Bankruptcy Code. In the event the Bankruptcy Court requires the Ad Hoc Group to
`submit such applications for reimbursement of the Ad Hoc Group Professional Fees, the
`Debtors and the Committee will represent to the Bankruptcy Court in writing that the Ad
`Hoc Group made a substantial contribution on account of this Settlement.
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`Rothschild Retention The Parties agree that the Ad Hoc Group’s Objection to the Debtors’ Application for
`Entry of an Order Authorizing the Employment and Retention of Rothschild & Co. US
`Inc. and Asesorias Financieras RP Spa as Financial Advisors and Investment Bankers to
`the Debtors Nunc Pro Tunc to the Petition Date and Waiving Certain Information
`Requirements Pursuant to Local Rule 2016-2 [Docket No. 164] is resolved by the
`inclusion of (i) the Reservation of Rights Language and (ii) agreed language in paragraph
`22 of the revised Order Authorizing the Employment and Retention of Rothschild & Co.
`US Inc. and Asesorias Financieras RP Spa as Financial Advisors and Investment Bankers
`to the Debtors Nunc Pro Tunc to the Petition Date and Waiving Certain Information
`Requirements Pursuant to Local Rule 2016-2 .
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`Amendment
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`Execution;
`Effectiveness
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`This Settlement Term Sheet may not be amended other than by a writing duly executed
`by or on behalf of each Party hereto.
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`This Settlement Term Sheet may be executed in counterparts (and by different parties
`hereto on different counterparts), each of which shall constitute an original, but all of
`which when taken together shall constitute a single contract.
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`Subject to approval of the Bankruptcy Court, this Settlement Term Sheet shall become
`effective when counsel to the Debtors has received counterparts executed by an
`authorized signatory on behalf of each of the Parties hereto that, when taken together,
`bear the signatures of each of the other Parties hereto, and thereafter shall be binding upon
`and inure to the benefit of each of the Parties hereto and their respective successors and
`assigns.
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`Any signature to this Settlement Term Sheet may be delivered by facsimile, electronic
`mail (including pdf) or any electronic signature complying with the U.S. federal ESIGN
`Act of 2000 or the New York Electronic Signature and Records Act or other transmission
`method and any counterpart so delivered shall be deemed to have been duly and validly
`delivered and be valid and effective for all purposes to the fullest extent permitted by
`applicable law. For the avoidance of any doubt, the foregoing also applies to any
`amendment, supplement or extension of this Settlement Term Sheet.
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`[Signature Pages Follow]
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`RLF1 31130727v.2
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`Case 24-10628-KBO Doc 531-1 Filed 07/15/24 Page 6 of 7
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`Dated: June 21, 2024
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`/s/ John H. Knight
`RICHARDS, LAYTON & FINGER, P.A.
`John H. Knight (No. 3848)
`Amanda R. Steele (No. 5530)
`Brendan J. Schlauch (No. 6115)
`Alexander R. Steiger (No. 7139)
`One Rodney Square
`920 North King Street
`Wilmington, Delaware 19801
`Telephone: (302) 651-7700
`Email: knight@rlf.com
`steele@rlf.com
`schlauch@rlf.com
`steiger@rlf.com
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`WHITE & CASE LLP
`John K. Cunningham (admitted pro hac vice)
`Richard S. Kebrdle (admitted pro hac vice)
`Southeast Financial Center
`200 South Biscayne Boulevard, Suite 4900
`Miami, Florida 33131
`Telephone: (305) 371-2700
`Email: jcunningham@whitecase.com
` rkebrdle@whitecase.com
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`Philip M. Abelson (admitted pro hac vice)
`Andrew Zatz (admitted pro hac vice)
`Samuel P. Hershey (admitted pro hac vice)
`Andrea Amulic (admitted pro hac vice)
`Lilian Marques (admitted pro hac vice)
`Claire Tuffey (admitted pro hac vice)
`1221 Avenue of the Americas
`New York, NY 10020
`Telephone: (212) 819-8200
`Email: philip.abelson@whitecase.com
` azatz@whitecase.com
` sam.hershey@whitecase.com
`ricardo.pasianotto@whitecase.com
`andrea.amulic@whitecase.com
`lilian.marques@whitecase.com
`claire.tuffey@whitecase.com
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`Co-Counsel to Debtors and Debtors-in-Possession
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`RLF1 31130727v.2
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`/s/ Robert F. Poppiti, Jr.
`Robert S. Brady (No. 2847)
`Robert F. Poppiti, Jr. (No. 5052)
`YOUNG CONAWAY STARGATT & TAYLOR, LLP
`1000 North King Street
`Wilmington, Delaware 19801
`Telephone: (302) 571-6600 Facsimile: (302) 571-1253
`rbrady@ycst.com
`rpoppiti@ycst.com
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`-and-
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`Allan S. Brilliant (admitted pro hac vice)
`Stephen M. Wolpert (admitted pro hac vice)
`Isaac D. Stevens (admitted pro hac vice)
`DECHERT LLP
`1095 Avenue of the Americas
`New York, NY 10036
`Telephone: (212) 698-3500
`Facsimile: (212) 698-3599
`allan.brilliant@dechert.com
`stephen.wolpert@dechert.com
`isaac.stevens@dechert.com
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`Michael S. Doluisio (admitted pro hac vice)
`Stuart T. Steinberg (admitted pro hac vice)
`DECHERT LLP
`Cira Centre
`2929 Arch Street
`Philadelphia, PA 19104
`Telephone: (215) 994-4000 Facsimile: (215) 994-2222
`michael.doluisio@dechert.com
`stuart.steinberg@dechert.com
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`Matthew F. Williams (admitted pro hac vice)
`DECHERT LLP
`45 Fremont Street, 26th Floor
`San Francisco, CA 94105
`Telephone: (415) 262-4500 Facsimile: (415) 262-4555
`matthew.williams@dechert.com
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`Counsel to the Ad Hoc Group of WOM Noteholders
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`Case 24-10628-KBO Doc 531-1 Filed 07/15/24 Page 7 of 7
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`/s/ David R. Hurst
`David R. Hurst (No. 3743)
`MCDERMOTT WILL & EMERY LLP
`The Brandywine Building
`1000 N. West Street, Suite 1400
`Wilmington, Delaware 19801
`(302) 485-3900
`dhurst@mwe.com
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`-and-
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`Brett H. Miller
`Todd M. Goren
`Craig A. Damast
`James H. Burbage
`WILLKIE FARR & GALLAGHER LLP
`787 Seventh Avenue
`New York, New York 10019
`(212) 728-8000
`bmiller@willkie.com
`tgoren@willkie.com
`cdamast@willkie.com
`jburbage@willkie.com
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`Counsel for the Official Committee
`of Unsecured Creditors
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`RLF1 31130727v.2
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