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Home Court filings Kservicing Bankruptcy Interim order — stock transfer restrictions (NOL protection) — In re KServicing

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Interim order — stock transfer restrictions (NOL protection) — In re KServicing

Record facts

CourtU.S. Bankruptcy Court for the District of Delaware
Filed2022-10-06

U.S. Bankruptcy Court for the District of Delaware · No. 22-10951 · Doc. 71 · 2022-10-06 · Docket on CourtListener

Summary

An interim order establishing notification procedures and approving restrictions on certain transfers of interests in the debtors, entered October 6, 2022 as Doc 71 in In re Kabbage, Inc. d/b/a KServicing, et al., Case No. 22-10951 (CTG), in the U.S. Bankruptcy Court for the District of Delaware. It grants on an interim basis the debtors' October 3, 2022 motion under sections 105(a) and 362 of the Bankruptcy Code to protect their Tax Attributes. The order approves Procedures governing trading in beneficial ownership of Common Stock, declares transfers in violation of them null and void ab initio, and approves notice forms annexed as exhibits. It sets a final hearing for November 7, 2022 at 1:00 p.m. with objections due October 31, 2022 at 4:00 p.m. The five-page order is signed by United States Bankruptcy Judge Craig T. Goldblatt.

Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used

Full text

RLF1 28023190v.1 
UNITED STATES BANKRUPTCY COURT 
DISTRICT OF DELAWARE 
------------------------------------------------------------ x 
 
In re 
: 
Chapter 11 
 
: 
 
KABBAGE, INC. d/b/a KSERVICING, et al., : 
Case No. 22-10951 (CTG) 
 
: 
 
 
: 
 
 
 
Debtors.1 
: 
: 
: 
(Jointly Administered) 
 
Ref. Docket No. 6  
------------------------------------------------------------ x 
 
 
INTERIM ORDER ESTABLISHING  
NOTIFICATION PROCEDURES AND APPROVING  
RESTRICTIONS ON CERTAIN TRANSFERS OF INTERESTS IN THE DEBTORS 
 
Upon the motion, dated October 3, 2022 (the “Motion”)2 of Kabbage, Inc. d/b/a 
KServicing and its debtor affiliates, as debtors and debtors in possession in the above-captioned 
Chapter 11 Cases (collectively, the “Debtors”), for entry of an order pursuant to sections 105(a) 
and 362 of the Bankruptcy Code authorizing the Debtors to establish procedures to protect the Tax 
Attributes, all as more fully set forth in the Motion; and this Court having jurisdiction to consider 
the Motion and the relief requested therein pursuant to 28 U.S.C. §§ 157 and 1334 and the 
Amended Standing Order of Reference from the United States District Court for the District of 
Delaware, dated February 29, 2012; and consideration of the Motion and the requested relief being 
a core proceeding pursuant to 28 U.S.C. § 157(b); and venue being proper before the Court 
pursuant to 28 U.S.C. §§ 1408 and 1409; and due and proper notice of the Motion having been 
                                                 
1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification 
number, as applicable are: Kabbage, Inc. d/b/a KServicing (3937); Kabbage Canada Holdings, LLC (N/A); Kabbage 
Asset Securitization LLC (N/A); Kabbage Asset Funding 2017-A LLC (4803); Kabbage Asset Funding 2019-A LLC 
(8973); and Kabbage Diameter, LLC (N/A).  Kabbage is a trademark of American Express used under license; 
Kabbage, Inc. d/b/a KServicing is not affiliated with American Express.  The Debtors’ mailing and service address is 
925B Peachtree Street NE, Suite 383, Atlanta, GA 30309. 
2 Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Motion. 
Case 22-10951-CTG    Doc 71    Filed 10/06/22    Page 1 of 5

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RLF1 28023190v.1 
provided; and such notice having been adequate and appropriate under the circumstances, and it 
appearing that no other or further notice need be provided; and the Court having held a hearing to 
consider the interim relief requested in the Motion (the “Hearing”); and upon the Motion, the First 
Day Declaration, and the record of the Hearing; and the Court having determined that the legal 
and factual bases set forth in the Motion establish just cause for the relief granted herein; and it 
appearing that the relief requested in the Motion is necessary to avoid immediate and irreparable 
harm to the Debtors and their estates, as contemplated by Bankruptcy Rule 6003; and upon all of 
the proceedings had before the Court; and after due deliberation and sufficient cause appearing 
therefor, 
IT IS HEREBY ORDERED THAT: 
1. 
The Motion is granted on an interim basis to the extent set forth herein. 
2. 
The provisions of this Interim Order shall be effective as of the Petition 
Date. 
3. 
The Debtors’ Tax Attributes are property of the Debtors’ estates and are 
protected by section 362(a) of the Bankruptcy Code. 
4. 
The restrictions, notification requirements, and other procedures annexed 
hereto as Exhibit 1 (the “Procedures”) are hereby approved and shall apply on or after the Petition 
Date to all trading and transfers in the beneficial ownership of Common Stock (including directly 
and indirectly, and including Options to acquire beneficial ownership of Common Stock), as 
provided therein; provided, that, the Debtors may, in their sole discretion, waive in writing, any 
and all restrictions, stays, and notification procedures set forth in the Procedures. 
5. 
Until further order of this Court to the contrary, any acquisition, disposition, 
or trading in the beneficial ownership of Common Stock (including directly and indirectly, and 
Case 22-10951-CTG    Doc 71    Filed 10/06/22    Page 2 of 5

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RLF1 28023190v.1 
including Options to acquire beneficial ownership of Common Stock) on or after the Petition Date 
in violation of the Stock Procedures shall be null and void ab initio pursuant to this Court’s 
equitable powers under section 105(a) of the Bankruptcy Code and as an act in violation of the 
automatic stay under section 362 of the Bankruptcy Code (other than, for the avoidance of doubt, 
the Disregarded Transfer Notice). 
6. 
Any person or Entity that acquires, disposes of, or trades in the beneficial 
ownership of Common Stock (including directly and indirectly, and including Options to acquire 
beneficial ownership of Common Stock) on or after the Petition Date in violation of this Interim 
Order or the Procedures or that otherwise fails to comply with their requirements shall be subject 
to such sanctions as this Court may consider appropriate pursuant to this Court’s equitable power 
under section 105(a) of the Bankruptcy Code. 
7. 
The notices substantially in the forms annexed hereto as Exhibit 2, 
Exhibit 3, and Exhibit 4 are hereby approved. 
8. 
Within five (5) business days of the entry of this Interim Order (or as soon 
as practicable thereafter), the Debtors shall serve the notice of this Interim Order (the “Notice of 
Interim Order”) substantially in the form annexed hereto as Exhibit 5, via first class mail and 
email or fax (of applicable), to (i) all parties that were served with notice of the Motion; and (ii) 
all registered holders of the Debtors’ debt and/or equity securities.  In addition, as soon as 
practicable after the entry of the Interim Order, the Debtors will publish the Notice of Interim 
Order once in the national edition of The New York Times.  In addition, the Debtors will post the 
Procedures to the website established by Omni Agent Solutions, Inc. for these Chapter 11 Cases 
(which website address shall be identified in the Notice of Interim Order), such notice being 
reasonably calculated to provide notice to all parties that may be affected by the Procedures, 
Case 22-10951-CTG    Doc 71    Filed 10/06/22    Page 3 of 5

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RLF1 28023190v.1 
whether known or unknown, and no further notice of the Procedures shall be necessary. 
9. 
Nothing herein shall preclude any person or Entity desirous of acquiring or 
transferring any beneficial ownership in Common Stock (including directly or indirectly, and 
including Options to acquire beneficial ownership of Common Stock) from requesting relief from 
this Interim Order from this Court, subject to the Debtors’ rights to oppose such relief. 
10. 
The relief granted in this Interim Order is intended solely to permit the 
Debtors to protect, preserve, and maximize the value of their Tax Attributes; accordingly, other 
than to the extent that this Interim Order expressly conditions or restricts trading in the beneficial 
ownership of Common Stock (including Options to acquire beneficial ownership of Common 
Stock), nothing in this Interim Order or in the Motion shall, or shall be deemed to, prejudice, 
impair, or otherwise alter or affect the rights of any holders of interests in the Debtors, including 
in connection with the treatment of any such interests under the Debtors’ chapter 11 plan or any 
applicable bankruptcy court order. 
11. 
Notwithstanding entry of this Interim Order, nothing herein shall create, nor 
is intended to create, any rights in favor of or enhance the status of any claim held by any party. 
12. 
The requirements set forth in this Interim Order are in addition to the 
requirements of applicable securities, corporate and other laws and do not excuse noncompliance 
therewith. 
13. 
Under the circumstances of these Chapter 11 Cases, notice of the Motion is 
adequate under Bankruptcy Rule 6004(a). 
14. 
The final hearing to consider the relief requested in the Motion shall be held 
on November 7, 2022 at 1:00 p.m. (Prevailing Eastern Time), and any objections or responses to 
the Motion shall be in writing, filed with the Court, and served on or prior to October 31, 2022 at 
Case 22-10951-CTG    Doc 71    Filed 10/06/22    Page 4 of 5

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RLF1 28023190v.1 
4:00 p.m. (Prevailing Eastern Time). 
15. 
The Debtors are authorized to take all action necessary or appropriate to 
effectuate the relief granted in this Interim Order. 
16. 
The Court shall retain jurisdiction to hear and determine all matters arising 
from or related to the implementation, interpretation, and/or enforcement of this Interim Order. 
Dated: October 6th, 2022 
Wilmington, Delaware
CRAIG T. GOLDBLATT 
UNITED STATES BANKRUPTCY JUDGE
Case 22-10951-CTG    Doc 71    Filed 10/06/22    Page 5 of 5

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archive.org
  1. Application to Retain and Employ Weil, Gotshal & Manges LLP as Debtors' Counsel — In re KServicingsame case · 2022-10-04
  2. Retention Application — Richards, Layton & Finger, P.A. as Co-Counsel — In re KServicingsame case · 2022-10-04
  3. Application to Retain Weil, Gotshal & Manges as Attorneys — In re Kabbage, Inc.same docket · 2022-10-05
  4. Kabbage - Notice of Revised Interim Cash Management Order, Doc. 62-1 — In re KServicing Wind Down Corp., et al.same docket · 2022-10-05
  5. Application to Retain AlixPartners as Financial Advisor — In re Kabbage, Inc. (KServicing)same docket · 2022-10-05
  6. Interim order — adequate assurance for utility providers — In re KServicing (Bankr. D. Del., 2022-10-06, 3)same docket · 2022-10-06
  7. Interim Order — Continue Servicing and Subservicing Activities — In re KServicingsame docket · 2022-10-06
  8. Order appointing claims and noticing agent (Omni Agent Solutions) — In re KServicingsame docket · 2022-10-06
  9. Interim order — payment of prepetition taxes and assessments — In re KServicingsame docket · 2022-10-06
  10. Order — consolidated creditor lists and special electronic noticing procedures for PPP borrowers — In re KServicingsame docket · 2022-10-06
  11. Interim order — continuation of insurance policies — In re KServicing (Bankr. D. Del., 2022-10-06, 2)same docket · 2022-10-06
  12. Motion of Debtors for Entry of Interimsame docket · 2022-10-06
  13. Interim order — payment of prepetition employee wages and benefits — In re KServicingsame docket · 2022-10-06
  14. Interim order — cash management system and bank accounts — In re KServicing (Bankr. D. Del., 2022-10-06, 1)same case · 2022-10-06
  15. Motion Of Debt, Doc. 84-1 — In re KServicing Wind Down Corp., et al.same docket · 2022-10-06
  16. First Day Hearing Transcript — In re KServicing (Bankr. D. Del.)same case · 2022-10-07
  17. Motion — Bar Dates for Proofs of Claim — In re KServicingsame case · 2022-10-11
  18. Motion — Interim Compensation Procedures for Retained Professionals — In re KServicingsame case · 2022-10-11
  19. Application to Employ Jones Day as Special Counsel — In re KServicing (Bankr. D. Del.)same case · 2022-10-14
  20. Motion — Authority to Employ Ordinary Course Professionals — In re KServicing (Bankr. D. Del.)same case · 2022-10-17

Part of: In re KServicing Wind Down Corp., et al. — U.S. Bankruptcy Court, D. Del. · U.S. Bankruptcy Court for the District of Delaware · Paycheck Protection Program (PPP) · Bankruptcies · Orders and opinions · 2022 · Court filings

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