KServicing - Plan Supplement as Filed — In re Kabbage, Inc. d/b/a KServicing, et al.

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EXHIBIT C
Wind Down Budget
Case 22-10951-CTG    Doc 561-3    Filed 02/21/23    Page 1 of 7

Wind Down Budget1

This schedule reflects the following: (1) a Wind Down Budget for the PPP Transfer
scenario where all loan servicing is transferred to an alternative servicer (the “Transfer Budget”)
and (2) a Wind Down Budget for the Post-Effective Date PPP Servicing scenario, where the
Debtors in their sole discretion, subject to Plan requirements, offer post-Effective Date servicing
(the “Servicing Budget” and together with the Transfer Budget, the “Wind Down Budgets”).
The Wind Down Budgets assume a Wind Down Officer is selected to effectuate the Wind Down
of the Debtors’ operations and pursue Causes of Action for the beneficiaries of the Wind Down
Estate.

The Wind Down Budgets include certain amounts for disputed claims and the actual
amounts of such claims may be higher or lower than the estimated disputed amount. The Wind
Down Budgets are preliminary and subject to further review and material revision and have been
prepared in good faith based on what the Debtors’ advisors believe are reasonable assumptions.
The Wind Down Budgets are subject to inherent risks and uncertainties and should be reviewed in
connection with the Disclosure Statement and the risk factors and assumptions set forth therein.
Many factors could cause actual results, performance or achievements to differ materially from
any future results, performance or achievements expressed or implied by these forward-looking
statements.
Transfer Budget
Assumptions
General
 The Transfer Budget assumes that the Debtors are not engaged in any
post-Effective Date loan servicing.
Timing
 The Transfer Budget assumes that a Wind Down will commence on
the Effective Date of the Plan, which is assumed to occur on or
around [March 31, 2023].
 The Transfer Budget assumes that an expedited corporate wind
down will last approximately four months, although the ultimate
length may vary in duration, and for the avoidance of doubt, the
Wind Down Estates will remain in existence for a sufficient time to
realize on the estate assets, including but not limited to, Causes of
Action.
Professional Fees
 The Transfer Budget does not reflect the professional Fee Escrow
Amount or amounts to be included therein.  The Fee Escrow Account
is assumed to be funded on or before the Effective Date and funds
held in the Fee Escrow Account shall not be considered property of
the Debtors’ estates or property of the Wind Down Estates and shall

1 Capitalized terms used herein but not otherwise defined shall have the meaning ascribed to them in the Amended
Joint Chapter 11 Plan of Liquidation of Kabbage, Inc. (d/b/a/ KServicing) and its Affiliated Debtors (as may be
amended, modified, or supplemented from time to time) (the “Plan”).
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be held in trust for estate-retained professionals, subject to Section
2.2 of the Plan.
 The post-Effective Date professional fee estimates reflected in the
Transfer Budget do not reflect a general unsecured claims
reconciliation or objection process.
Receipts
 Legacy Loan Portfolio: The Transfer Budget assumes the Wind
Down Estates will not be making collections from borrowers of
Legacy Loans during the Wind Down period because the Legacy
Loans are presumed to have been sold on or about the Effective Date.
Therefore, the Transfer Budget does not contemplate any potential
proceeds from the sale of the Legacy Loans.
 PPPLF Portfolio:  The Transfer Budget assumes the Wind Down
Estates will not receive collections on account of borrower payments
or remittances to the Partner Banks or Reserve Bank with the
exception of final remittances from any residual collections on
account of loans transferred as of the Effective Date.
Operating Expenses
 Includes payment of employees with a reduced workforce to account
for discontinued servicing and payment of fees to independent
contractors for limited staff as well as continued payment of rent and
utilities for the Debtors’ leased premises and information technology
related costs during the 4 month Wind Down period.
Non-Operating
Expenses
 Assumes renewal of certain policies with annual premiums paid on
expiration date, including director and officer insurance purchased in
the Wind Down period, as well as payment of taxes during the Wind
Down period.
 Payment of quarterly U.S. Trustee fees.
Professional Fees
 Assumes certain funding for Wind Down Officer services for three
years and fees for tax advisors and legal counsel solely on account
of effectuating corporate dissolution and preparation for final tax
returns.
 Assumes certain funding for the Wind Down Estates to pursue
Causes of Action.  In addition, Wind Down Officer may retain
counsel based on different fee arrangements, including on a
contingency fee basis, that may vary from the amounts listed
herein.

Case 22-10951-CTG    Doc 561-3    Filed 02/21/23    Page 3 of 7

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Transfer Budget 2
Wind Down Period
Week beg
4/1/2023
Week end
8/4/2023

Operating Expenses

Payroll & Benefits
$
(1,027)
Service Provider Fees
(827)
IT Software/IT Services
(644)
Other Opex3
(302)
Total Operating Expenses
$
(2,800)

Non-Operating Expenses

Professional Fees
$
(2,597)
Taxes
(220)
Insurance (Incl. Incremental D&O)
(84)
US Trustee Fees
(150)
Contract Cures
(100)
Wind Down Officer Related Costs
(1,200)
Litigation Advisors and Related Costs
(2,500)
Total Non-Operating Expenses
$
(6,851)

Wind Down and Litigation Reserves

Wind Down Contingency Reserves
$
(2,000)
Litigation Contingency Reserves
(1,500)
Total Wind Down and Litigation Reserves
$
(3,500)

Total Budgeted Expenses
$
(13,150)

2 The Transfer Budget does not reflect: (1) estimates on final collections from (a) legacy loan borrowers or (b)
collection agencies on account of the legacy loans or (2) amounts collected for the benefit of and passed onto the
Reserve Bank (on account of the Pledged PPPLF Loans), CB (on account of the CB PPP Loans), and CRB (on
account of the CRB PPP Loans).  The Transfer Budget assumes the Debtors will have sufficient cash on hand to
complete all necessary Wind Down activities captured in the Wind Down Budget.
3 Other Opex includes ordinary course consulting fees, and rent and utilities for the Debtors’ leased premises.
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Servicing Budget
Assumptions
General
 The Servicing Budget assumes that the Debtors continue to service
all or certain of the CB PPP Loans, CRB PPP Loans, and/or Pledged
PPPLF Loans on a post-Effective Date basis for three years,
corresponding with the maturity date of the outstanding loans.
Servicing costs may differ depending on how many of the foregoing
portfolios are serviced on a post-Effective Date basis.
 Any amounts on account of continued servicing of Pledged PPPLF
Loans, CRB PPP Loans, or CB PPP Loans, as applicable, shall be
funded by the payment of applicable Post-Effective Date Servicing
Costs.
Timing
 The Servicing Budget assumes that a Wind Down will commence on
the Effective Date of the Plan, which is assumed to occur on or
around March 31, 2023.
 The Servicing Budget assumes that a Wind Down will last through
January 30, 2026 although the ultimate length vary in duration
depending on payment, guarantee purchase, and/or loan forgiveness
of the CB PPP Loans, CRB PPP Loans, and/or the Pledged PPPLF
Loans.
Professional Fees
 The Servicing Budget does not reflect the professional Fee Escrow
Amount or amounts to be included therein.  The Fee Escrow Account
is assumed to be funded on or before the Effective Date and funds
held in the Fee Escrow Account shall not be considered property of
the Debtors’ estates or property of the Wind Down Estates and shall
be held in trust for estate-retained professionals.
 The post-Effective Date professional fee estimates reflected in the
Servicing Budget do not reflect a general unsecured claims
reconciliation or objection process.
Receipts
 Legacy Loan Portfolio: The Servicing Budget assumes the Wind
Down Estates will make collections from borrowers of Legacy Loans
for the duration of the Wind Down period.
 PPPLF Portfolio:  The Servicing Budget assumes the Wind Down
Estates will receive collections on account of borrower payments or
remittances to the Partner Banks or Reserve Bank for the duration of
the Wind Down period.
Operating Expenses
 Includes among other things: Payment of employee wages for non-
loan operation related functions, customer service and collection
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through the Wind Down and payment of employee wages for
functions related to loan operations with a reduced workforce
starting at the end of 2023 and a complete reduction by the end of
2024. Also includes payment of fees to independent contractors for
continued staff through 2024, fees for loan forgiveness processing,
fees paid pursuant to the Transition Services Agreement,
compensation for a member of the board of directors, and continued
costs associated with the servicing of the CB PPP Loans, CRB PPP
Loans, and/or Pledged PPPLF Loans.  The operating expenses also
include continued payment of rent and utilities for the Debtors’
leased premises and information technology related costs through the
Wind Down period.
Non-Operating
Expenses
 Assumes renewal of certain policies with annual premiums paid on
expiration date, including director and officer insurance purchased in
the Wind Down period, as well as payment of certain million in taxes
during the Wind Down period.
 Payment of quarterly U.S. Trustee fees.
Professional Fees
 Assumes monthly fees for a Wind Down Officer through the end of
the Wind Down, and fees and expenses for tax advisors and legal
counsel during the post Effective Date period.

Servicing Budget4
Wind Down Period
Week beg
4/1/2023
Week end
1/30/2026

Operating Expenses

Payroll & Benefits
$
(8,687)
Service Provider Fees
(8,578)
IT Software/IT Services
(10,370)
Board Fees
(600)
Other Opex5
(4,972)
Total Operating Expenses
$
(33,208)

4 The Servicing Budget does not reflect: (1) estimates on collections from (a) legacy loan borrowers or (b) collection
agencies on account of the legacy loans, (2) release of Celtic Bank restricted cash on account of the legacy loans
and (3) amounts collected for the benefit of and passed onto the Reserve Bank (on account of the Pledged PPPLF
Loans), CB (on account of the CB PPP Loans), and CRB (on account of the CRB PPP Loans).  The Servicing Budget
assumes the Debtors will have sufficient cash on hand to complete all necessary Wind Down activities captured in
the Wind Down Budget, provided that any amounts on account of continued servicing of Pledged PPPLF Loans,
CRB PPP Loans, or CB PPP Loans, as applicable, shall be funded by the payment of applicable Post-Effective Date
Servicing Costs.
5 Other Opex includes ordinary course consulting fees, and rent and utilities for the Debtors’ leased premises.
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Non-Operating Expenses

Professional Fees
$
(5,038)
Taxes
(500)
Insurance (Incl. Incremental D&O)
(263)
US Trustee Fees
(950)
Contract Cures
(500)
Wind Down Officer Related Costs
(1,200)
Litigation Advisors and Related Costs
(2,500)
Total Non-Operating Expenses
$
(10,951)

Wind Down and Litigation Reserves

Wind Down Contingency Reserves
$
(8,000)
Litigation Contingency Reserves
(1,500)
Total Wind Down and Litigation Reserves
$
(9,500)

Total Budgeted Expenses
$
(53,658)

Case 22-10951-CTG    Doc 561-3    Filed 02/21/23    Page 7 of 7

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