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Final Order has been signed authorizing the sale to SG INVESTMENT AMERICA, INC for $13M, although Linden Blue offered $15.3M. I have not dove into the differences why SG prevailed, but maybe related to the DIP financing.

https://cases.stretto.com/public/x32...0000000142.pdf

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You are right, very odd. I thought highest bidder would get it. Should be interesting to learn what happened.

Let’s hope they keep building planes

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Thanks Marcus I read through that just a few moment ago before you posted it and saw the final bid from SG was $15.54M (Page 61 of 170)
and Linden Blue's was $15.29M (Page 91 of 170)

Their initial Stalking horse bid was $13M which was noted high up in the court document.

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Bret thanks for sorting that out, makes more sense. As you pointed out the price was revised in the "Amendment No 1 to Asset Purchase Agreement".

Going through the Assumed Contracts section (starting on Page 128) I see thirteen Aircraft Purchase Agreements and six Aircraft Operating Agreements listed. Not clear why they were selected. For everyone else I assume the Limited Warranty and the Operating Agreements will not transfer to the new entity.

I asked ICON CEO Jerry Meyer if SG Investment America plans to issue any statement with their future plans to Icon plane owners now that they have been deemed the highest bidder and he responded "ICON's management team is in active communication with them and we will let you know as soon as we have any relevant information."

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Marcus I noticed that too. The only thing I can think of is those were the only contracts with 1 year warranty's still valid at the time of declaring BK I don't think they delivered more than 13 last year.

I lost part of my warranty on my Pitts engine many years ago after Thielert who purchased Superior Airparts shortly before I bought my engine went BK about 2 years later. I would have expected all contracts would have been wiped clean but guess not

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Looking at the list, I am on it (oddly lists me and not my LLC). Is that good or bad to be on the list for "Aircraft Operating Agreements" for cure amount of $0?

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Did you sign the purchase agreement under your LLC or personally? What your airplane is registered under could be different.

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Buyer is my LLC , but I signed.

Not being a lawyer, I have no clue what "cured"means in contract terms.

I do see names of employees I know, so I assume those are their hiring contracts, but not sure.

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AOPA has a pretty good writeup on the bankruptcy status.

https://www.aopa.org/news-and-media/all-news/2024/june/20/court-approves-icon-aircraft-sale

Minority shareholders including company founder Kirk Hawkins, who sued Icon's majority owner, Pudong Science and Technology Investment Co. Ltd., in Delaware state court in 2021 challenging an alleged "expropriation of … intellectual property in aircraft design, aircraft manufacturing, and advanced carbon-fiber structures manufacturing to China," withdrew an objection to the sale. Attorney Sean Mitchell, representing those shareholders, told the court June 18 that revisions to the sale agreement preserve his clients' rights to continue to pursue their claims, and that negotiations between those parties are ongoing. He added that if those negotiations fail to produce an agreement, his clients may return to the bankruptcy court seeking an order allowing them to proceed with pre-petition claims.

So the derivative litigation was not dismissed as part of the Chapter 11. Will be interesting to see how those negotiations go.

"We don't have a week to reopen the auction and try this again for what we don't imagine is a significant additional amount of money," Persons said. "The debtors burn, on average, upwards of $750,000 to $850,000 a week right now, and liquidity is extremely tight. We forecast that we would run out of liquidity by the end of the first week of July. Any further delay in closing past the July 2 date is simply unsustainable for the debtors at this time."

According to published reports, SG Investment America is owned by a 160-year-old German manufacturer of sewing machines, Dürkopp Adler GmbH, which is, in turn, owned by ShangGong Group of Shanghai, China, which also makes sewing machines.

Will be nice if SG Investment America will present their plans for the owners.

Court documents show that one of Icon's largest creditors has been repaid: East West Bank of El Monte, California, which loaned the company more than $60 million at various times prior to the bankruptcy filing, has been repaid those secured claims and its counsel withdrew from the proceedings.

Need to look into this. Where did those funds come from?

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That seems to be a really high weekly burn rate for ICON. They would have to sell 9 ICONs a month to sustain that.

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I’m gonna be honest, it a bit surreal seeing all these numbers in a public space. You now have a little insight into why they went BK. The question you should ask is why the company/people that has the majority share of the company filed for bankruptcy just to buy it back for$ 15.54 million when the burn rate is that high and the sells that low?

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I’m gonna be honest, it a bit surreal seeing all these numbers in a public space. You now have a little insight into why they went BK. The question you should ask is why the company/people that has the majority share of the company filed for bankruptcy just to buy it back for$ 15.54 million when the burn rate is that high and the sells that low?

Yep, that is a good question. I wonder if the silence to owners is due to SG needing to first put up the money to know they will be the new owners of ICON, or if Linden Blue wins.
If ICON continues, it will really need to do a Tesla and leave CA for a state with no state income tax and wacky state manufacturing laws.

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Haha. No mid west state will be cheaper than Tijuana Mexico where 90% of the aircraft is manufactured.

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Haha. No mid west state will be cheaper than Tijuana Mexico where 90% of the aircraft is manufactured.

Agree, keep Tiajuana, just the corporate office and final assembly. Money still passes through CA, so CA taxes apply.

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Need to look into this. Where did those funds come from?

Here is the letter where East West withdrew from the case, but I have not seen information on the payment.

https://cases.stretto.com/public/x32...0000000146.pdf

I also came across this Liquidation analysis:
https://cases.stretto.com/public/x32...0000000103.pdf

As expected the DIP loan gets repaid first, leaving very little for the Unsecured Liabilities. I wonder if the bulk of the Short Term customer deposits are the early deposit holders?

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Another news article in AvWeb

https://www.avweb.com/aviation-news/...id-bankruptcy/

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Here is an AI summary and transcript of the final hearing:

Case: ICON Aircraft, Inc., Case No. 24-10703

Participants:
- Judge
- Sean Beach (Debtors' Counsel, Young Conaway Stargatt & Taylor)
- Charles Persons (Debtors' Counsel, Sidley Austin)
- Nathan Elner (Sidley Austin)
- Ashley Jacobs (Young Conaway Stargatt & Taylor)
- Neil Gupta (SSG Partners)
- Sean Mitchell (Paul, Weiss, Rifkind, Wharton & Garrison, Derivative Litigation Plaintiffs)
- Bill Smelko (SG Investment America, Inc.)

Key Points:
1. Sale Motion: The primary agenda item was the sale of ICON Aircraft's assets. Another item on the agenda had already been resolved by the court.
2. Auction and Bids:
- Initial Auction: The auction took place at Sidley Austin's offices. SG Investment America (DA) initially bid $13 million without bid protections. Lyndon Blue submitted a qualified bid of $13.29 million.
- Auction Outcome: DA's final bid was $15.54 million. Lyndon Blue's backup bid was $15.29 million. Post-auction, DA agreed to pay within five business days and take possession within four business days, regardless of Chinese regulatory approval.
3. Subsequent Bids: Lyndon Blue expressed interest in improving his bid, eventually offering $15.79 million. DA matched this bid but indicated they could not go higher without six additional days for preparation.
4. Final Decision: Due to the debtors' liquidity issues and the need for a timely sale, DA's $15.79 million bid was accepted. The sale order was to be entered promptly, with necessary documentation adjustments.
5. Derivative Litigation: Sean Mitchell confirmed that modifications to the sale order ensured that estate claims were preserved, and the litigation could continue unaffected by the sale.
6. Cure Objection: A cure objection by VALIA IP was resolved, and the stipulation was filed and set for the judge's approval.

Conclusion: The judge approved the sale to DA for $15.79 million, recognizing the debtors' efforts to maximize asset value and manage liquidity constraints. The court appreciated the parties' hard work and perseverance.

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Good morning. We're here re ICON AIRCRAFT, Inc., which is case number 24-10703. Mr. Beach.

Sean Beach: Good morning, Your Honor. For the record, Sean Beach from Young Conaway Stargatt & Taylor on behalf of the debtors. Your Honor, thank you, as always, for making time for us today. As you're aware, the primary item on the agenda today is with respect to the sale of substantially all of the companiys that are listed on the agenda today is the sale There was another item on the agenda, item number 2, which, Your Honor, has already entered that order, so we're here today on the sale motion.

There has been some action over the last couple days, which Mr. Persons will walk through with, Your Honor, but we do believe we are here with, if not a fully consensual hearing, a largely consensual hearing today. We'll see if that sticks, but that's where we stand at the moment. Okay.

Your Honor, with me today are Charles Persons and Nathan Elner from Sidley Austin, and my colleague Ashley Jacobs from Young Conaway. Also in the courtroom with us today is Mr. Neil Gupta with SSG Partners, who is a declarant with respect to the sale today.

Judge: Terrific.

Sean Beach: With that, Your Honor, I'll cede the podium to Mr. Persons.

Judge: Okay. Thank you, Mr. Beach. Mr. Persons.

Charles Persons: Good morning, Your Honor. Charles Persons of Sidley Austin on behalf of the debtors.

As Mr. Beach noted, we will turn to docket number 83, the debtors' sale motion. Your Honor, my expectation upon arriving yesterday in Delaware was that after what could only be described as a successful auction and the help of various parties working diligently to resolve the formal and informal objections to the sale, that we would arrive this morning to a hearing where Mr. Elner would quickly walk you through what would mostly be described as a formality. However, at 4 p.m. yesterday, we received word that our proposed backup bidder from the auction, Mr. Lyndon Blue, was possibly interested in making an additional bid, and thus began a scramble that went on all last evening and well into the morning and brings us to where we are at the moment, which, as Mr. Beach stated, I believe, is a fully resolved sale order, hopefully without much contention this morning.

Nonetheless, because of the additional bid, the additional movement by the parties, I think it makes sense, Your Honor, to walk you through what happened yesterday and probably, therefore, to begin by backtracking to discuss the details of the initial auction that took place last Thursday. We will move on to, ultimately, Your Honor, you will hear that SG Investment America, who I will refer to as DA in this hearing, in our original stalking horse bid, has indeed been determined to be the highest and best overall bid for the debtors' assets and, therefore, why the debtors will respectfully request you enter the sale order as filed, although we will need to attach an updated APA, Your Honor. So as Your Honor is aware, the debtors approached the deadline last Monday, June 10th, with DA acting as the stalking horse for the purchase of the debtors' assets at a price of $13.0 million.

As Your Honor may also recall, there were no bid protections associated with the DA bid. In advance of the bid deadline, the debtors received a bid for Mr. Lyndon Blue, which the debtors later determined to be a qualified bid. That bid was for $13.29 million and for all assets.

With the exception of adding two additional executory contracts to the excluded assets list and the removal of any conditions requiring Chinese regulatory approval, as had been in the DA bid, the bids were effectively apples to apples. Thereafter, the debtors were able to go back to DA and for reasons related to the Chinese regulatory approval process that I won't pretend to fully understand, added an amendment to the original APA without actually changing the APA itself. Doing so, as we understood it, would require the approval process begin over again. So, it's actually an amendment to the APA that makes the changes to the original APA.

Judge: By approval process, you mean the Chinese approval process?

Charles Persons: Yes, Your Honor. Excuse me. The Chinese approval process. Yes. That amendment limited the impact, among other things, limited the impact that regulatory approval, Chinese regulatory approval would have on timing of a potential transfer of the assets by stating that DA would transfer the full amount of its purchase price within five business days of the entry of the sale order.

This is a very valuable change from the debtor's standpoint, Your Honor, as this company remains cash flow negative, something that we will discuss again here in a moment. DA also indicated at that time that it intended to top Mr. Blue's bid, but would do so at the auction. Also valuable to the debtors, Your Honor, was the second qualified bid inviting the full auction, which was held at Sidley's offices in New York this past Thursday.

Both bidders agreed on the record that they would increase their deposits to 10% of whatever their final bid price would be, and agreed to act as the backup bidder if they were ultimately not selected as the successful bidder. Mr. Blue's $13.29 million bid was declared the opening bid. The parties then engaged in what I can only describe as the most brisk 363 auction in my 17 years of doing this.

Within the next 10 minutes or so, nine additional bids came in, resulting in a proposed purchase price by DA of $15.54 million, in and of itself a nearly 20% increase over the original stocking force bid. Mr. Blue's backup bid of $15.29 million was selected as the backup bidder's second best bid. Critically, Your Honor, following the statement by Mr. Blue's representative that he would not be bidding further, the debtors left the auction open on the record, but proceeded to finalize documents with DA around the new purchase price.

The auction also allowed the debtors to obtain one more critical item from DA in the discussions following the auction, Your Honor. Specifically, DA agreed that it would not only pay the full purchase price within five business days, as it had agreed to prior to the auction, but it would take possession of the assets and assume the liabilities within four business days of the payment of the purchase price, regardless of whether Chinese regulatory approval had been met by that date. That means the debtors would be able to significantly stem the outflow of cash otherwise needed to continue its operations on a day-to-day basis by, at worst, July 2nd date.

If DA were not able to take and assume the liabilities by July 2nd, Mr. Blue's backup bid would be required to close within five business days himself. There is also an outside date, Your Honor, with respect to both bids, although it only necessarily applies to Mr. Blue's likely at this point, whereby Mr. Blue will remain the backup bidder until September 15th, should Chinese regulatory approval not remain in place. Debtors are also aware, Your Honor, that Mr. Blue's representatives reached out to DA following the auction to make a separate proposal that might have resulted in a greater return to the estate, and this foreshadows some of what happened yesterday.

That proposal by Mr. Blue was effectively offered to purchase the debtors' U.S. assets and permit DA to have exclusive rights to license the debtors' IP in China. At this time, Fei Ren, the debtors' DIP lender, has a non-exclusive license to use the debtors' IP in China. Nonetheless, we understand, Your Honor, that DA chose not to continue to engage in that, although my understanding is they left open the possibility of further discussions down the road on that front.

Following discussions with Mr. Fitzgerald, who, as the debtors' special committee member, has the sole authority to authorize the sale of the debtors' assets in this Chapter 11 process, the debtors filed a notice of successful bidder at Docket 278 this past Friday. The notice did state that DA was, quote, the successful bidder at the auction, and the bid was highest and best, which at the time was true. The procedures required us, of course, to file the notice of successful bidder.

It also described Mr. Blue as the next highest bidder. However, as I mentioned before, Your Honor, the auction was on the record left open with respect to the process itself. All of this leads to yesterday's flurry of activity.

At around 4 p.m., the debtors received word that Mr. Blue was interested in improving his bid. There was an initial offer made by e-mail, so in writing to Mr. Gupta. However, Your Honor, it took us a number of hours to narrow down and fully understand exactly what the actual bid was.

Specifically, in the meantime, Your Honor, Mr. Gupta informed Mr. Blue that we were not interested in a further back-and-forth among the parties at 250k a pop. And so, if he were interested in truly providing a topping bid of some kind, we were asking for his, quote, best and final offer. Last night, around 9 p.m., the debtors received what Mr. Blue represented was his best and final offer, which is actually two separate offers, Your Honor.

First, they would match the bid of DA at $15.54 million, but exclude all of the seller's registered intellectual property in China. Second, the second option, Your Honor, was that the debtors would, excuse me, that Mr. Blue would raise his bid by $250,000 above the DA bid to $15.79 million, effectively a topping bid.

$15.79 is another $250,000 increment. Correct, Your Honor, another $250,000. Despite the late hour, we spoke thereafter with counsel for DA, Mr. Smalko, who is here in the room.

Given the time zone constraints DA finds itself under as a German company, we understood we were making an exceptional request for his client to attempt to respond to the subsequent bid. Nonetheless, with back and forth as late as 2.30 a.m. last night, Mr. Smalko is still working with the debtors and working to try to find either a resolution, subsequent bid, or to determine how we were going to move forward today. Again, as I'm happy to say, I believe we have reached a resolution at this point, thanks to the hard work of the DA team and Mr. Smalko and his team.

First and foremost, I will say, Your Honor, that Mr. Smalko did reserve his right at the time with respect to whether or not the debtors were improper in accepting the subsequent bid in the way that they did. I believe that has been resolved on the basis of what we plan to go forward with today, Your Honor. But to the extent this remains an issue, the debtors would note that the procedures do allow, specifically state that upon an order of the court, debtors can consider any subsequent bid, even if the auction is quote-unquote closed, although the debtors do not believe it was closed.

After further discussions this morning, Your Honor, we heard from Mr. Smalko that DA was not interested in splitting the assets with Mr. Blue, the same response that they gave following the auction on Thursday. We're not interested in bidding solely on the debtors' registered intellectual property in China. They would, however, raise their bid for all assets to match Mr. Blue's bid at $15.79 million.

And when I finish here in a moment, I would ask Mr. Smalko to go ahead and confirm that on the record, although we do have an email response indicating that as well. Crucially, Mr. Smalko also made the debtors aware that DA would not be able to raise its bid beyond $15.79 million or respond to any further offers or subsequent bids that Mr. Blue might try to make unless they had upwards of six additional days to prepare themselves for a further auction. Unfortunately, Your Honor, the debtors simply don't have that kind of time.

We don't have a week to reopen the auction and try this again for what we don't imagine is a significant additional amount of money. The debtors burn on average $750,000 to $850,000 a week right now, and liquidity is extremely tight. We forecast that we would run out of liquidity by the end of the first week of July.

Any further delay in closing past the July 2nd date is simply unsustainable for the debtors at this time. Additionally, I would say, Your Honor, that certainty regarding the debtors' ability to transfer the assets and assumed liabilities to DA is critical, and DA provides the certainty that the debtors are looking for on that front. The debtors met with a special committee this morning to discuss the revised bids with Mr. Blue and Mr. DA, and following careful consideration has determined that the $15.79 million bid by DA for all assets should be the highest and overall best bid for the debtors at this time.

As Your Honor is aware, the debtors' duty is to maximize value for all the assets. Sometimes that makes the situation a little bit difficult, and sometimes we have to spring to respond at the last moment. We do think there is value in the process that happened yesterday, in addition to simply the $250,000. We know for certain now, based on the representations of Mr. Blue, that that list is final and best bid. We believe, therefore, this is the final and the best bid that the debtors can get for these assets. And so with that, Your Honor, we are determined to close the auction and respectfully request that you enter the order today.

I'll allow others to speak, and then we will proffer, in addition to moving into evidence, the two declarations of Mr. Gupta that are on file. We will, if it is acceptable to Your Honor, proffer additional testimony from Mr. Gupta. And he is, as noted, in the courtroom and available to answer questions.

Judge: Okay. I understand this update was extremely helpful. I hope that however this comes out, after this is done, everyone in this courtroom can get some rest. But I am now happy to hear from other parties and interests who would like to be heard. Thank you. Thank you, Mr. Persons.

Sean Mitchell: Good morning, Your Honor. Sean Mitchell from Paul, Weiss, Rifkind, Wharton & Garrison on behalf of the Derivative Litigation Plaintiffs. First, I'd like to inform the Court that we've worked with the debtors to modify the sale order, which I think was filed at Docket Number 261, to resolve our outstanding issues solely with respect to the sale order.

The changes reflected in this revised sale order ensure that no estate claims were sold, released, or otherwise impacted by the sale before Your Honor today. These changes appear throughout the revised sale order, and the overarching protections have been added in paragraphs 34 and 35. In addition to ensuring that estate causes of action are preserved, the modifications to the sale order constrain some of the findings of fact and relief granted to more appropriately suit the unique facts of this case and this posture that we find ourselves in.

Specifically, the findings regarding the insider status of the stalking horse bidder have been appropriately limited to exclude its affiliates. And findings with respect to the good faith actions of the parties involved in sale transactions have been limited to apply solely to actions taken pursuant to the bidding procedures, specifically excluding the conduct at issue in the derivative litigation. So, while we've resolved our issues with respect to the sale order, our clients, of course, are disappointed that the company has been driven to this point.

The unfortunate reality is that much of the value of this company was lost in the years prior to the sale and to these Chapter 11 cases by virtue of the conduct which is at the heart of the derivative litigation. But we are where we are today. The question is then, how do we move forward? To that end, we've been in discussions with the debtors with respect to the disposition of the derivative claims.

However, depending on how these negotiations proceed, we may be back to Your Honor in the coming weeks seeking a comfort order to confirm that, to the extent necessary, the automatic stay is modified to permit the continued pre-petition prosecution of the derivative litigation. Of course, in that instance, we'd also have associated plan objections to ensure continued prosecution of the claims. Your Honor, thank you for the time.

Judge: All right. So, as I understand where you are, right, what we're here on is an order, a motion seeking an order authorizing the sale of the business assets. And what you're saying is as to that sale process, you don't have issues. Correct. That you're satisfied that the order is revised doesn't prejudice your rights with respect to the litigation, the derivative litigation, whether the order you might be seeking is a comfort order or is actually affirmatively seeking stay relief is a thing we can address if and when we get there. But that's not before me today. So, from your perspective, there's no objection to the entry of the form of sale order as proposed. Do I have that mostly right?

Sean Mitchell: That's correct.

Judge: Okay. Very well. Thank you very much.

Bill Smelko: Good morning, Your Honor. My name is Bill Smelko. I'm an attorney in California. Please don't hold that against me. I'm here with Mr. Miller who brought bail money just in case.

My client principal is on the phone and I am here to confirm that Mr. Persons' representations are accurate, that my client, SG Investment America, Inc., will purchase the assets under the terms of the sale order for $15.79 million, cash within five days of the approval of entry of the order, five working days of the approval of the order. And if you have any questions, Your Honor, I can answer those questions, I hope. But the buyer is ready, willing, and able to perform under the order as lodged by the debtor.And we appreciate all of the efforts of the debtor, Mr. Gupta, its counsel, to get this done. And I would appreciate the sleep on the airplane. Thank you, Your Honor.

Judge: Thank you, Mr. Smelko. Any other party in interest wish to be heard with respect to the motion? Okay. If not, Mr. Persons, you suggested you would want to clean up the evidentiary record?

Charles Persons: Yes, Your Honor. So first and foremost, Your Honor, on the docket are two declarations from Mr. Gupta, the first at docket entry number 84 and the second at docket number 279. We would ask first and foremost that both of those declarations be entered into evidence.

Judge: Okay. Is there any party in interest that would like to be heard with respect to the introduction to evidence of the Gupta declarations that are DI 84 and 279? Seeing none, those will be admitted. I guess I should ask, is there any party in interest that wishes to cross-examine Mr. Gupta with respect to the matters set forth in the declarations? Okay. Seeing none, Mr. Persons, you can proceed.

Charles Persons: Thank you, Your Honor. Again, Your Honor, to supplement the record, given the late-breaking news from yesterday, we would offer a proffer of Mr. Gupta, incorporating, of course, the previous two declarations and the evidence therein. If Mr. Gupta were to take the stand, Your Honor, he would testify truthfully with respect to the fact that there are two bids, two bids were received yesterday, or two offers, potential offers were received yesterday from Mr. Blue on June 17, 2024, that those two offers were for either $15.79 million for all of the assets or $15.54 million with the exclusion of the Chinese IP assets, that Mr. Blue affirmed that was his best and final offer with respect to these assets and this auction process.

Mr. Gupta would further testify, Your Honor, that the DA bid came in this morning of $15.79 million, that that was discussed with the Special Committee and that the Special Committee approved the sale to SG Investment America, Inc. at the price of $15.79 million. Further testify, Your Honor, that DA indicated to debtors professionals last night that it would require them six additional days to improve further any additional bids and that timing is of the essence for the debtors, Your Honor, and that the burn rate for the company, Your Honor, is too great at this point in time to allow for that kind of time to lapse.

Additionally, the subsequent new bids are in the best interest of the debtors, their estates, and their creditors. The successful bid of $15.79 million to DA is the highest or otherwise best offer available for the assets and results in the best available recoveries for the debtors' creditors. And the backup bid submitted by Mr. Blue is the second highest and best otherwise available offer.

And our understanding, Your Honor, is that that second highest and best available offer is also $15.79 million cash. I believe Mr. Gupta would testify that the stalking horse purchaser, SSG, the debtors, Mr. Blue, and the debtors' other professionals acted in good faith throughout this process and that the debtors are not aware that the SG Investment America, Inc., Your Honor, is not an insider with respect to the debtors as a newly formed entity that will be taking on these assets.

Judge: Slow down. Sorry. That sentence, the number of negatives confused me. So you're not aware that they are an insider. Are you prepared to represent that?

Charles Persons: The debtors represent that so far upon information available to it that SG Investment America, Inc., is not an insider of the debtors.

Judge: And let's slow down. So I take it that is part of the proffer of Mr. Gupta's testimony, right?

Charles Persons: That is, Your Honor. Okay. That was a request to be one of the requests of the informal objection of the U.S. trustee was to put that on the record.

Judge: I understood. So let me pause there. Is there anything further that you want to proffer from Mr. Gupta by way of testimony?

Charles Persons: Do not believe so, Your Honor.

Judge: Okay. So let me pause there and ask, is there any party and interest that objects to the court admitting into evidence the proffer as if that were Mr. Gupta's live testimony before the court? Okay. Seeing none, the proffer will be accepted. Anything else by way of argument or evidence?

Charles Persons: No, Your Honor.

Judge: Okay. Just to be clear, is there any party and interest that would like the opportunity to be heard with respect to the approval of the sale of the debtor's assets to, I guess, the company that has been referred to as DA on the terms as described this morning? So seeing none, I have, I guess, reviewed the form of order. I am satisfied by the evidence presented that the debtors have run an appropriate process, have soundly exercised their business judgment and that the sale is in the best interest of creditors in the estate. And I'm happy to enter the order as proposed, authorizing the sale. I appreciate that it sounds like you need to get a finalized form of APA to be attached as an exhibit to the order. Is that where we are?

Charles Persons: That's correct, Your Honor, but it should just involve changing the number.

Judge: Well, I guess I appreciate under the circumstances that there's times of the essence. So we want to make sure that we get that order. So I guess, is it fair to say that order will be uploaded today and that we can get that entered upon being uploaded?

Charles Persons: Yes, Your Honor.

Judge: Okay. And I take it from no concern about the court entering the order upon being uploaded. Okay. So I'm happy to enter that order. We look forward to it coming through and we'll get it entered promptly. Anything else that we should... I take it there's nothing else on the agenda for today in light of the order having been entered on the lift stay earlier, right?

Charles Persons: I believe that's correct, Your Honor.

Judge: Okay. Is there any other way in which the court can be helpful to the parties while we're here? Yeah.

Charles Persons: So we do, Your Honor... Actually, Ms. Jacobs, do you want to handle exactly where we're on the stipulation? There's one item, Your Honor, which I believe is sitting with you, but I'll let Ms. Jacobs give you the details.

Ashley Jacobs: Good morning, Your Honor. For the record, Ashley Jacobs of YYoung Conaway Stargatt & Taylor on behalf of the debtors. Your Honor, there was a cure objection filed by VALIA IP. It was listed as item B on the agenda. We have listed it as adjourned for today. We wanted to update, Your Honor, that we did reach a resolution with VALIA and we filed a stipulation at docket number 292 this morning resolving that cure issue. Got it.

Judge: Okay. Is that filed with certification for me to enter?

Ashley Jacobs: Correct, Your Honor.

Judge: Okay. Then I will review it and absent some concerns striking me, we'll go ahead and enter the order approving the stipulation.

Ashley Jacobs: Thank you very much, Your Honor. Thank you.

Judge: Okay. With that, is there anything further to be addressed today, Mr. Persons?

Charles Persons: Nothing for the debtors, Your Honor. Thank you very much.

Judge: Okay. While we're here, is there any other parting interests that would like to be heard with respect to anything that I should know? Okay. If not, let me... Look, I appreciate that sale hearings like this after auction processes that run into the wee hours takes a toll on all parties and interests. So, I appreciate everyone's perseverance and patience. We will go ahead and get that order entered. I do very much encourage everyone to get the appropriate amount of rest.

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So the bigger question is what happens next, assuming the closing happens on July 1st? We haven't seen any plans from SG Investment America.

- Are they going to keep ICON business as going?
- If so, how long are they willing to fund the cashflow negative operation?
- What changes to operations should we expect?

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So the bigger question is what happens next, assuming the closing happens on July 1st? We haven't seen any plans from SG Investment America.

- Are they going to keep ICON business as going?
- If so, how long are they willing to fund the cashflow negative operation?
- What changes to operations should we expect?

My concerns as well.

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I am going to presume that they will keep a small sales and support staff in the US (CA for now, then probably TX) and Tampa FL and gradually move ops away. I am not sure if Moving the fab away from MX will have any short-term benefits. They could very well open a second facility with more efficient Pre-Preg tooling in MLC for their asian customers.

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How we all feel right now….
https://youtube.com/shorts/tLCDpp9F0...xzFWF8Sk6HDCI3

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Good one! Especially for those that only recently got the plane, and perhaps had to pull strings to even make it happen.

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That would be me. Went from no plane or thought of getting anytime soon, and 2weeks later over Christmas I started a business and now own a plane. Now that plane is back from Leaseback, I due to open Flying School next month after Annual is done (which originally ICON was paying for but I wonder what happens if the wheels come off?)

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That would be. Went from no plane or thought of getting anytime soon, and 2weeks later over Christmas I started a business and now own a plane. Now that plane is back from Leaseback, I due to open Flying School next month after Annual is done (which originally ICON was paying for but I wonder what happens if the wheels come off?)

At this point, we keep our fingers crossed.

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New filing just dropped. The closing occurred today, with some complications in transferring employees to the new entity due to health insurance. So they are asking for some employees to remain with old ICON under a "transition services agreement" with new ICON for the month of July.

https://cases.stretto.com/public/x32...0000000141.pdf

Pursuant to the terms of the APA, the Purchaser took possession of the Purchased Assets and assumed the Assumed Liabilities (each as defined in the APA) on June 26, 2024 (the “Transfer Date”). The Purchaser and the Debtors initially expected the transfer of certain employees of the Debtors to the Purchaser in connection therewith. However, due to unforeseen circumstances, the Purchaser was unable to transfer the employment of certain employees to at-will employment with the Purchaser as of the Transfer Date (the “Transitioning Employees”). As a result, the Debtors and the Purchaser negotiated the terms of the TSA, which contemplates that the Purchaser will obtain services from the Transitioning Employees during the month of July 2024 while the Purchaser works to transition employment of the Transitioning Employees. The term of the TSA commences on July 1, 2024. Through the TSA Motion, the Debtors request that the Court enter an order approving the TSA and authorizing the Debtors’ entry into the TSA.

Specifically, certain logistics are necessary to ensure that the Transitioning Employees have adequate insurance and health coverage following transfer to the Purchaser, and the process of establishing these logistics was not able to be completed prior to the Transfer Date. The TSA will provide the Purchaser with access to the Transitioning Employees, who have substantial knowledge of the Debtors’ business and operations, and is critical to facilitate the seamless transition of the business to the Purchaser while the Purchaser works to transition such individuals to at-will employment with the Purchaser. Moreover, the term of the TSA commences on July 1, 2024.

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Thanks again for the update Marcus. Is that a good sign, that they’re keeping some employees? Possibly bring Icon back to life?

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Hopefully we will get an update from new owners of their vision and plan. Some staff employees have apparently already gotten their permanent pink slips. It’s a tough time for everyone.

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A copy of the Transition Services Agreement was just filed:

https://cases.stretto.com/public/x32...0000000029.pdf

It covers the following employees

EMPLOYEES
1. Hank Blair
2. Mandy Chung
3. Theodore Coldren
4. Noah Collins
5. Rodolfo Henrique Correa
6. Jason Courtney
7. Anthony Curley
8. Bryan Duran
9. Kristen Eckman
10. Jake Fenton
11. Karina Hamilton
12. Jason (Xiaosong) Huang
13. Noel Hurtado
14. George Jones
15. Gaelan Kamin
16. Christopher Mack
17. Dexter Manalili
18. Daniel Mertesdorf
19. Andrew Mesias
20. Maria Odena
21. Kavita Pahuja
22. Melchor Pananganan
23. Randy Penning
24. Byron Pittman
25. William Rodenbeck
26. Austin Rodriguez
27. Ryan Sims
28. Sean Stamps
29. Samuel Striplin
30. Devon Woodruff

The contractors list is TBD.

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Not seeing Jerry, Andy Jackson, and MOST of the sales people. Scott R seems to be the only surviving sales person. Super pumped we still have Mandy!

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Also today the Derivative Litigation group filed a new motion, ChatGPT summarized below:

The motion revolves around ICON Aircraft, Inc. and its affiliates, who have filed for Chapter 11 bankruptcy. The Derivative Litigation Plaintiffs, equity holders in ICON, are seeking to lift the automatic stay imposed by the bankruptcy filing to continue their lawsuit in the Delaware Chancery Court.

The derivative claims in the case against ICON Aircraft, Inc. include the following:

1. Breaches of Fiduciary Duty: The PDSTI Defendants, who are affiliated with ICON, are alleged to have violated their fiduciary duties to the company and its shareholders. These duties include acting in the best interests of the company and its stakeholders.

2. Unjust Enrichment: The Defendants are accused of benefiting financially at the expense of ICON and its minority shareholders through improper actions and decisions that favored their interests over those of the company.

3. Aiding and Abetting: Certain PDSTI Defendants allegedly assisted others in breaching their fiduciary duties, facilitating actions that harmed ICON and its shareholders.

The Plaintiffs argue that these claims have a high likelihood of success, as they have already survived motions to dismiss in the Delaware Chancery Court. They believe that allowing them to continue prosecuting these claims will potentially recover value for ICON's estate and its stakeholders, and that the Debtors (ICON) are currently unable or unwilling to pursue these claims effectively themselves due to conflicts of interest and limited resources.

https://cases.stretto.com/public/x32...0000000027.pdf

More details:

The motion is filed by the Derivative Litigation Plaintiffs, who are equity holders in ICON Aircraft, Inc., seeking court approval to continue prosecuting their claims against the PDSTI Defendants in the Delaware Chancery Court. These claims involve breaches of fiduciary duty, unjust enrichment, and aiding and abetting breaches of fiduciary duty. The Plaintiffs argue that the Debtors (ICON and affiliated companies) will not be prejudiced by this action and that it will benefit the estate. The motion highlights the history of the case, including previous court decisions supporting the Plaintiffs' claims, and emphasizes the need for an independent and thorough prosecution of these claims outside of the bankruptcy proceedings.

Here are the key details:

1. Relief Requested: The Plaintiffs are asking for relief from the automatic stay under section 362(d) of the Bankruptcy Code to continue their derivative claims in the Chancery Court. They believe this will not prejudice the Debtors or their estates and will potentially benefit the estates if successful.

2. Claims and Defendants: The claims include breaches of fiduciary duty, unjust enrichment, and aiding and abetting against the PDSTI Defendants, who have been involved in mismanagement and misconduct affecting ICON.

3. Background: The Plaintiffs filed their initial complaint in February 2022, which survived motions to dismiss in the Chancery Court. The Debtors filed for bankruptcy in April 2024, which stayed the litigation.

4. Argument for Continuation: The Plaintiffs argue that they are well-positioned to continue the litigation, having invested significant time and resources. They assert that the claims are strong and have a high likelihood of success, as indicated by the Chancery Court’s rulings.

5. Lack of Prejudice to Debtors: The motion argues that continuing the litigation will not harm the Debtors, as the Plaintiffs will bear the costs. Successful litigation would benefit the estate by potentially increasing recoveries for creditors and equity holders.

6. Judicial Economy: Continuing the litigation in the Chancery Court is presented as the most efficient path forward, avoiding duplication of efforts and conserving judicial resources.

7. Debtors' Conduct: The motion criticizes the Debtors for their handling of the bankruptcy and their reluctance to pursue the claims against PDSTI, suggesting that the Plaintiffs are the more appropriate parties to continue the litigation.

8. Hearing Date: The motion is set for a hearing on July 12, 2024, with objections due by July 3, 2024.

The motion seeks to ensure that the derivative claims are vigorously prosecuted, potentially recovering value for the ICON estate that might otherwise be lost.