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RLF1 28111662v.1
Exhibit A
Proposed Order
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RLF1 28111662v.1
UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE
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In re
:
Chapter 11
:
KABBAGE, INC. d/b/a KSERVICING et al.,
:
Case No. 22-10951 (CTG)
:
:
(Jointly Administered)
Debtors.1
:
------------------------------------------------------------ x
Re: Docket No. ____
ORDER AUTHORIZING DEBTORS TO EMPLOY
PROFESSIONALS USED IN ORDINARY COURSE OF BUSINESS
Upon the motion, dated October 17, 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”), pursuant to sections 105(a), 327, and 330 of the
Bankruptcy Code for entry of an order authorizing the Debtors to employ Ordinary Course
Professionals, effective as of the Petition Date, without the submission of separate employment
applications or the issuance of separate retention orders for each professional, all as more fully set
forth in the Motion; and upon consideration of the First Day Declaration; 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 entered by 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 this Court pursuant to 28 U.S.C. §§ 1408 and 1409; and due and proper notice of the
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.
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Motion having been 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 this Court
having reviewed the Motion; and upon any hearing held on the Motion; and all objections, if any,
to the Motion having been withdrawn, resolved, or overruled; and this 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 in the best interests of the Debtors,
their estates, creditors, and all parties in interest; and upon all of the proceedings had before this
Court and after due deliberation and sufficient cause appearing therefor,
IT IS HEREBY ORDERED THAT
1.
The Motion is granted as set forth herein.
2.
The Debtors are authorized, but not directed, pursuant to sections 105(a),
327, and 330 of the Bankruptcy Code, to retain, employ, and compensate the Ordinary Course
Professionals listed on Exhibit 1 annexed hereto in accordance with the following OCP
Procedures, effective as of the Petition Date:
a.
Pursuant to sections 105(a), 327, and 330 of the Bankruptcy Code, the
Debtors shall be authorized to employ the Ordinary Course Professionals
listed on Exhibit 1 annexed to this Order in accordance with these OCP
Procedures, effective as of the Petition Date.
b.
Each Ordinary Course Professional shall provide the Debtors’ attorneys
within 30 days after the later of (i) the date of entry of this Order or (ii) the
date on which the Ordinary Course Professional commences rendering
services for the Debtors, with a declaration, substantially in the form
annexed as Exhibit 2 hereto (the “OCP Declaration”).
c.
The Debtors’ attorneys shall file the OCP Declaration with the Court and
serve a copy upon (i) Richard L. Schepacarter, Office of the United States
Trustee (Richard.Schepacarter@usdoj.gov), (ii) Rosa Sierra-Fox, Office of
the United States Trustee (Rosa.Sierra-Fox@usdoj.gov), and (iii) counsel
for the Creditors’ Committee, if any (collectively, the “Reviewing
Parties”).
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d.
The Reviewing Parties shall have 14 days after service of the OCP
Declaration (the “Objection Deadline”) to serve upon the Debtors, the
other Reviewing Parties, and the relevant Ordinary Course Professional a
written objection to the retention, employment, or compensation of the
Ordinary Course Professional based on the contents of the OCP Declaration
(an “Objection”).
e.
If no Objection is served by the Objection Deadline, the retention,
employment, and compensation of the Ordinary Course Professional shall
be deemed approved pursuant to section 327 of the Bankruptcy Code
without the need for a hearing and without further order of this Court;
provided, however, that if an Objection is served by the Objection Deadline
and such Objection cannot be resolved within 20 calendar days, the Debtors
shall schedule the matter for a hearing before this Court on the next
regularly-scheduled hearing date or such other date otherwise agreeable to
the Ordinary Course Professional, the Debtors, and the objecting party.
f.
The Debtors may seek to retain additional Ordinary Course Professionals
throughout these cases by (i) including each additional Ordinary Course
Professional on a supplement to Exhibit 1 hereto that is filed with this Court
and served on the Reviewing Parties and (ii) having such additional
Ordinary Course Professional comply with the OCP Procedures. The
approved retention of the additional Ordinary Course Professional(s) will
be effective as of the expiration of the Objection Deadline or, if a timely
Objection is filed, upon resolution of such objection.
g.
Once an Ordinary Course Professional is retained in accordance with these
OCP Procedures, the Debtors may pay such Ordinary Course Professional
100% of the fees and 100% of the expenses incurred, upon the submission
to, and approval by, the Debtors of an appropriate invoice setting forth in
reasonable detail the nature of the services rendered and the expenses
actually incurred (without prejudice to the Debtors’ right to dispute any such
invoices); provided, however, that the Ordinary Course Professional’s total
compensation and reimbursement shall not exceed $50,000 per month on
average over any three-month period on a rolling basis (the “Monthly Fee
Cap”).
h.
In the event that an Ordinary Course Professional’s fees and expenses
exceed the Monthly Fee Cap for any month during these chapter 11 cases,
but the Debtors believe the Ordinary Course Professional should not
otherwise be required to follow the payment procedure applicable to the
formally retained professionals, the Debtors may seek the agreement of the
Reviewing Parties to a higher cap for any such Ordinary Course
Professional. If the Debtors are able to obtain such agreement of the
Reviewing Parties, the agreement would be evidenced by the filing of a
notice of increased Monthly Fee Cap (the “Cap Increase Notice”), and the
increased Monthly Fee Cap shall be deemed approved upon the filing of
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such Cap Increase Notice, without further action by this Court. Absent such
an agreement of the Reviewing Parties, if the Monthly Fee Cap is exceeded,
such Ordinary Course Professional must file a fee application
(a “Fee Application”) and apply for allowance of the full amount of its
compensation and reimbursement for the applicable time period in
compliance with sections 330 and 331 of the Bankruptcy Code and the
applicable provisions of the Bankruptcy Rules, the Local Rules, and, subject
to the OCP Procedures, any other procedures and orders of this Court. The
U.S. Trustee reserves the right to request that any Ordinary Course
Professional that is regularly exceeding the Monthly Fee Cap be the subject
of a retention application pursuant to section 327 of the Bankruptcy Code.
Any such Ordinary Course Professional that is an attorney shall make a
reasonable effort to comply with the U.S. Trustee’s requests for information
and disclosures as set forth in the Guidelines for Reviewing Applications for
Compensation and Reimbursement of Expenses Filed under 11 U.S.C.
§ 330 by Attorneys in Larger Chapter 11 Cases (effective as of November
1, 2013) in connection with such Fee Application and/or retention
application.
i.
Each Fee Application shall be served upon the Reviewing Parties. The
Reviewing Parties shall then have 15 days to object to the Fee Application.
If, after 15 days, no Objection is filed, the fees and expenses requested in
the Fee Application shall be deemed approved, and the Ordinary Course
Professional may be paid 100% of its fees and expenses without the need
for further action from such Ordinary Course Professional.
j.
At three-month intervals during the pendency of these chapter 11 cases
(each, a “Quarter”), beginning with the Quarter ending December 31,
2022, the Debtors shall file with this Court and serve on the Reviewing
Parties, no later than 30 days after the last day of such Quarter, a statement
that shall include the following information for each Ordinary Course
Professional: (i) the name of the Ordinary Course Professional, (ii) the
amounts invoiced and paid as compensation for services rendered and
reimbursement of expenses incurred by that Ordinary Course Professional
during the reported Quarter broken down by month, (iii) the aggregate
amount of postpetition payments made to that Ordinary Course Professional
to date, and (iv) a general description of the services rendered by that
Ordinary Course Professional.
3.
Entry of this Order and approval of the OCP Procedures does not affect the
Debtors’ ability to (i) dispute any invoice submitted by an Ordinary Course Professional or
(ii) retain additional Ordinary Course Professionals from time to time as needed, in accordance
with the OCP Procedures, and the Debtors reserve all of their rights with respect thereto.
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4.
The monetary caps set forth in the OCP Procedures are without prejudice to
the Debtors’ ability to request that this Court increase the terms of such caps at a later time.
5.
The form of OCP Declaration is approved.
6.
Nothing contained in the Motion or this Order nor any payment made
pursuant to the authority granted by this Order is intended to be or shall be construed as (i) an
admission as to the validity of any claim against the Debtors, (ii) a waiver of the Debtors’ or any
appropriate party in interest’s rights to dispute the amount of, basis for, or validity of any claim
against the Debtors, (iii) a waiver of any claims or causes of action which may exist against any
creditor or interest holder, or (iv) an approval, assumption, adoption, or rejection of any agreement,
contract, lease, program, or policy between the Debtors and any third party under section 365 of
the Bankruptcy Code.
7.
All time periods referenced in this Order shall be calculated in accordance
with Bankruptcy Rule 9006(a).
8.
The Debtors are authorized to take all actions necessary or appropriate to
effectuate the relief granted in this Order.
9.
This Court shall retain jurisdiction to hear and determine all matters arising
from or related to the implementation, interpretation, or enforcement of this Order.
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Exhibit 1
List of Ordinary Course Professionals
Name
Address
General Description
Alston & Bird LLP
950 F Street NW
Washington, D.C. 20004
Litigation counsel
Davis Polk & Wardwell LLP
901 15th Street, NW
Washington, D.C. 20005
Government investigations counsel
Dentons US LLP
1221 6th Avenue
New York, New York 10020
Litigation counsel
McGuireWoods LLP
1250 6th Avenue
New York, New York 10020
Regulatory counsel
Thomas E. Austin, Jr. LLC
2625 Piedmont Road, N.E. Suite 56-330
Atlanta, Georgia 30324
Litigation counsel
Windham Brannon, LLC
3630 Peachtree Road NE #600
Atlanta, GA 30326
Tax and accounting advisors
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Exhibit 2
OCP Declaration
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RLF1 28111662v.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)
------------------------------------------------------------ x
DECLARATION AND DISCLOSURE STATEMENT OF ______________________,
ON BEHALF OF
I, _______________, hereby declare, pursuant to section 1746 of title 28 of the
United States Code, that the following is true to the best of my knowledge, information, and
belief:
1.
I am a [insert title] of [firm] located at [street, city, state, zip code]
(the “Firm”).
2.
This declaration (the “Declaration”) is submitted in accordance with the
Order Pursuant to 11 U.S.C. §§ 105(a), 327, and 330 Authorizing Debtors to Employ
Professionals Used in Ordinary Course of Business [Docket No. ___] (the “OCP Order”).
Capitalized terms used herein but not otherwise defined herein shall have the meanings ascribed
to such terms in the OCP Order.
3.
Kabbage, Inc. d/b/a KServicing and its debtor affiliates, as debtors and
debtors in possession (collectively, the “Debtors”), have requested that the Firm provide
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.
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[description of type of services] services to the Debtors, and the Firm has consented to provide
such services.
4.
The Firm may have performed services in the past and may perform services
in the future, in matters unrelated to these chapter 11 cases, for persons who are parties in interest
in the Debtors’ chapter 11 cases. As part of its customary practice, the Firm is retained in cases,
proceedings, and transactions involving many different parties, some of whom may represent or
be claimants or employees of the Debtors, or other parties-in-interest in these chapter 11 cases.
The Firm does not perform services for any such person in connection with these chapter 11 cases.
In addition, the Firm does not have any relationship with any such person, its attorneys, or
accountants that would be adverse to the Debtors or their estates [with respect to the matters on
which the Firm is to be retained.]2
5.
Neither I, nor any principal of, or professional employed by the Firm has
agreed to share or will share any portion of the compensation to be received from the Debtors with
any other person other than the principals and regular employees of the Firm.
6.
Neither I, nor any principal of, or professional employed by the Firm,
insofar as I have been able to ascertain, holds or represents any interest adverse to the Debtors or
their estates, [with respect to the matters on which the Firm is to be retained.]3
7.
The Debtors owe the Firm $________ for prepetition services, the payment
of which is subject to the limitations contained in the Bankruptcy Code. [FOR NON-LEGAL
SERVICES FIRMS ONLY ADD: The Firm has agreed to waive all unpaid amounts for prepetition
services.]
2 This clause shall only be included if the Ordinary Course Professional is an attorney.
3 This clause shall only be included if the Ordinary Course Professional is an attorney.
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8.
As of the Petition Date, the Firm [was/was not] party to an agreement for
indemnification with the Debtors. [A copy of such agreement is attached as Exhibit A to this
Declaration.]
9.
The Firm is conducting further inquiries regarding its retention by any
creditors of the Debtors, and upon conclusion of that inquiry, or at any time during the period of
its employment, if the Firm should discover any facts bearing on the matters described herein, the
Firm will supplement the information contained in this Declaration.
I declare under penalty of perjury that the foregoing is true and correct.
Executed on:
, 2022
By:
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