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Home Source documents First Interim Fee Application of Kirkland & Ellis LLP — In re Vyaire Medical, Inc. (Bankr. D. Del.)

First Interim Fee Application of Kirkland & Ellis LLP — In re Vyaire Medical, Inc. (Bankr. D. Del.)

Date
2024-06-09

Summary

The First Interim Fee Application of Kirkland & Ellis LLP and Kirkland & Ellis International LLP, attorneys for the debtors, filed November 13, 2024 as Doc 742 in In re Vyaire Medical, Inc., et al., Case No. 24-11217 (BLS), in the U.S. Bankruptcy Court for the District of Delaware. It seeks $9,309,620.32 in compensation and $65,000.23 in expenses for the period from June 9, 2024 through August 31, 2024. The summary cover sheet lists prior monthly applications at Docket No. 489, Docket No. 604 and Docket No. 615, total compensation of $7,454,697.53 approved to date, and holdback fees of $1,854,922.79. It includes tables of hours and rates by attorney and paraprofessional, fees by project category, and an expense summary. The application closes by asking the court to award the fees and expenses and direct the debtors to pay them.

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

                Case 24-11217-BLS              Doc 742        Filed 11/13/24        Page 1 of 42




                        IN THE UNITED STATES BANKRUPTCY COURT
                             FOR THE DISTRICT OF DELAWARE

                                                        )
In re:                                                  )    Chapter 11
                                                        )
VYAIRE MEDICAL, INC., et al.,1                          )    Case No. 24-11217 (BLS)
                                                        )
                           Debtors.                     )    (Jointly Administered)
                                                        )

                   SUMMARY COVER SHEET TO THE FIRST
          INTERIM FEE APPLICATION OF KIRKLAND & ELLIS LLP AND
           KIRKLAND & ELLIS INTERNATIONAL LLP, ATTORNEYS FOR
         THE DEBTORS AND DEBTORS IN POSSESSION, FOR THE INTERIM
    FEE PERIOD FROM JUNE 9, 2024 THROUGH AND INCLUDING AUGUST 31, 2024
Name of Applicant:                                                 Kirkland & Ellis LLP

Authorized to Provide Professional Services to:                    Debtors and Debtors in Possession

Date of Retention:                                                 August 5, 2024 effective as of June 9, 2024

Interim Period for which Compensation and                          June 9, 2024 through August 31, 2024
Reimbursement is Sought:

Interim Amount of Compensation Sought                              $9,309,620.32
as Actual, Reasonable and Necessary:2

Interim Amount of Expense Reimbursement                            $65,000.23
Sought as Actual, Reasonable, and Necessary:

Amount of Holdback Fees Sought                                     $1,854,922.79
for Applicable Period:

Total Compensation Approved by                                     $7,454,697.53
Interim Order to Date:




1
     The last four digits of Debtor Vyaire Medical, Inc.’s federal tax identification number are 6495. A complete list
     of each of the Debtors in these chapter 11 cases and each such Debtor’s federal tax identification number may
     be obtained on the website of the Debtors’ claims and noticing agent at https://omniagentsolutions.com/Vyaire.
     The location of Debtor Vyaire Medical, Inc.’s principal place of business and the Debtors’ service address in
     these chapter 11 cases is 26125 North Riverwoods Boulevard, Mettawa, Illinois, USA 60045.
2
     For the avoidance of doubt, the interim amount of compensation and the amount of holdback fees sought
     include the reductions agreed upon with the Office of the United States Trustee (the “U.S. Trustee”).
                     Case 24-11217-BLS           Doc 742      Filed 11/13/24    Page 2 of 42




     This is a(n)      monthly _X_ interim ___ final application.

     This Fee Application includes approximately 23 hours and $25,000.00 in fees incurred in connection with
     the preparation of K&E Fee Applications.


                                                 Prior Applications

                                                         Requested                             Approved
  Date Filed;
                         Period Covered              Fees          Expenses          Fees               Expenses
  Docket No.

  8/30/2024
                      June 9, 2024 – June 30,    $1,875,844.00     $25,041.09    $1,875,844.00         $25,041.09
Docket No. 489
                               2024
  10/3/2024           July 1, 2024 – July 31,
                                                 $2,796,646.00     $33,951.83    $2,796,646.00         $33,951.83
Docket No. 604                 2024
  10/9/2024          August 1, 2024 – August
                                                 $2,794,772.80     $6,007.31     $2,782,207.53          $6,007.31
Docket No. 615               31, 2024
                     Total                       $7,467,262.80     $65,000.23    $7,454,697.53         $65,000.23


                        Summary of Hours by Attorney Billed In Interim Fee Period

                                                                   Hourly
                                                                                Hours Billed
   Attorney                                        Date of       Billing Rate                         Fees Billed
                    Position     Department                                       In this
    Name                                          Admission         In this                       In this Application
                                                                                Application
                                                                 Application
                                   ECEB -
  Rebecca H.
                    Associate     Executive          2017         1,199.62         22.10             $26,511.50
    Arnall
                                Compensation
   Cooper                        Corporate -
                    Associate                        2023          885.97          12.40             $10,986.00
   Barghols                        General
                                   ECEB –
  Wes Benter        Associate       Labor/           2019         1,575.00          0.50               $787.50
                                 Employment
                                Technology &
  Samantha
                    Associate         IP             2019         1,345.00          7.00              $9,415.00
   Bradley
                                 Transactions
  Chris Ceresa      Associate   Restructuring        2020         1,382.42        477.80             $660,521.00
Tiffani Chanroo     Associate   Restructuring        2021         1,319.21        328.20             $432,965.00
     Kenny
                    Associate    Restructuring       2023          907.69         150.00             $136,154.00
   Chiaghana
 Erica D. Clark     Associate   Restructuring        2019         1,595.00         104.90            $167,315.50
                                  ECEB -
  Dominique
                    Associate    Executive           2020         1,127.38          2.10              $2,367.50
   Collins
                                Compensation
   Georgia          Associate    Litigation -        2021         1,185.00          0.90              $1,066.50


                                                         2
                 Case 24-11217-BLS          Doc 742      Filed 11/13/24   Page 3 of 42




                                                             Hourly
                                                                          Hours Billed
  Attorney                                    Date of      Billing Rate                      Fees Billed
                Position    Department                                      In this
   Name                                      Admission        In this                    In this Application
                                                                          Application
                                                           Application
Cooper-Dervan                  General
  Joseph A.                  Litigation -
                Associate                      2021          1,210.21        12.10          $14,643.50
  D’Antonio                    General
 Jaina Desai    Associate   Restructuring      2023          937.86         519.60          $487,314.00
                            Technology &
   Shareen
                Associate         IP           2018          1,265.00         2.00           $2,530.00
   Dhillon
                             Transactions
                             Corporate -
  Luke Finn     Associate   M&A/Private        2021          1,345.00       249.80          $335,981.00
                                Equity
                            Technology &
  Justin M.
                Associate         IP           2022          1,081.81        93.70          $101,365.50
  Garfinkle
                             Transactions
Emanuel Goetz   Associate      Taxation        2024          744.82          87.80          $65,395.00
   Palmer
                Associate     Taxation         2023          965.54         172.60          $166,652.00
  Gunderson
 David Hackel   Associate   Restructuring      2023          1,009.02       155.90          $157,306.50
                             Corporate -
 Yoonie Han     Associate                      2019          1,456.08        27.70          $40,333.50
                            Debt Finance
    Liz Ji      Associate      Taxation        2021          1,225.21        28.70          $35,163.50
   Olivia                    Corporate -
                Associate                      2023          1,048.72        52.90          $55,477.50
  Kaufmann                    Healthcare
                               ECEB -
 Sooah Kim      Associate     Employee         2022          1,066.55        19.40          $20,691.00
                               Benefits
                             Corporate -
 Brian King     Associate                      2017          1,345.00         3.60           $4,842.00
                              Healthcare
                            Technology &
 Maggie Kate
                Associate         IP           2021          1,229.94        70.30          $86,464.50
    King
                             Transactions
   Sabrina
                Associate   Restructuring      2023          901.18         298.90          $269,363.50
 Lieberman
  Savannah                   Antitrust/
                Associate                      2023          1,146.00        13.00          $14,898.00
 Malnar-Cole                Competition
   Jennifer                 Litigation -
                Associate                      2022          1,037.50         6.00           $6,225.00
   Mancini                    General
 Rebecca J.
                Associate   Restructuring      2021          1,309.31       288.30          $377,475.50
   Marston
                             Corporate -
  Brandan
                Associate   M&A/Private        2021          1,345.00       118.30          $159,113.50
  Matthews
                               Equity
   Grant                     Corporate -
                Associate                      2023          815.00           2.00           $1,630.00
 McClernon                   Healthcare
  Ruan J.                    Corporate -
                Associate                      2022          1,059.47        96.60          $102,345.00
  Meintjes                   Healthcare


                                                   3
                  Case 24-11217-BLS           Doc 742      Filed 11/13/24   Page 4 of 42




                                                               Hourly
                                                                            Hours Billed
  Attorney                                      Date of      Billing Rate                      Fees Billed
                 Position     Department                                      In this
   Name                                        Admission        In this                    In this Application
                                                                            Application
                                                             Application
   Julienne                   Corporate -
                 Associate                       2023          822.66          16.70          $13,738.50
   Miranda                     General
                              Corporate -
 Jake Moeller    Associate                       2022          1,095.00         5.60           $6,132.00
                               General
   Michael
                              Corporate -
   William       Associate                       2022          978.60          10.00           $9,786.00
                               General
   Morgan
 Jai Mudhar      Associate   Restructuring       2020          1,324.56        27.40          $36,293.00
                              Corporate -
Trent Nachbar    Associate   M&A/Private         2022          1,228.10       151.10          $185,565.50
                                Equity
                              Corporate -
Dan O’Connor     Associate   M&A/Private         2021          1,323.73       235.10          $311,209.50
                                Equity
Sarah Osborne    Associate   Restructuring       2023          908.78         252.00          $229,012.00
 Carolin Paus    Associate   Restructuring       2023          679.15          64.40           $43,737.00
   D. Taylor                  Corporate -
                 Associate                       2023          975.00          29.30          $28,567.50
   Petersen                    General
Joseph Cermak                 Corporate -
                 Associate                       2022          1,011.50        26.30          $26,602.50
   Profancik                 Debt Finance
Joshua Raphael   Associate   Restructuring       2023          1,076.33       108.00          $116,244.00
Adrian Salmen    Associate   Restructuring       2021          1,202.51        80.80           $97,163.00
 Seth Sanders    Associate   Restructuring       2021          1,140.59       115.60          $131,852.00
    Florian
                 Associate     Taxation          2023          750.00           1.50           $1,125.00
   Schuette
                             Technology &
   Scottie
                 Associate         IP            2018          1,553.01       181.70          $282,181.50
 Shermetaro
                              Transactions
                             Technology &
 Daniel Shin     Associate         IP            2023          975.00          37.60          $36,660.00
                              Transactions
                              Litigation -
Noah Spector     Associate                       2021          1,184.29        77.40          $91,664.00
                                General
                             Environment -
Matt Swanson     Associate                       2021          1,329.00         3.50           $4,651.50
                             Transactional
  Kyle Nolan
                 Associate   Restructuring       2020          1,152.87       108.40          $124,971.00
    Trevett
 Josh Valletta   Associate    Restructuring      2023          975.00           0.30            $292.50
                             ECEB - Labor/
 Paul Vasiloff   Associate                       2021          1,315.26        15.60          $20,518.00
                              Employment
Donatus Wang     Associate    Restructuring      2022          924.13          55.50          $51,289.00
 Quin Wetzel     Associate    Restructuring      2023          892.82          106.50         $95,085.50
 Ann-Kathrin
                 Associate   Restructuring       2018          1,064.15        41.00          $43,630.00
   Ziegler
    Kon           Partner    Restructuring       2000          2,305.00        45.00          $103,725.00


                                                     4
                   Case 24-11217-BLS          Doc 742      Filed 11/13/24   Page 5 of 42




                                                               Hourly
                                                                            Hours Billed
  Attorney                                      Date of      Billing Rate                      Fees Billed
                  Position   Department                                       In this
   Name                                        Admission        In this                    In this Application
                                                                            Application
                                                             Application
Asimacopoulos
                               Antitrust/
 Marin Boney      Partner                        2008          1,885.00         2.50           $4,712.50
                              Competition
John G. Caruso    Partner     Real Estate        1992          2,115.00         8.60          $18,189.00
                              Corporate -
Adam Thomas
                  Partner    M&A/Private         2013          1,995.00        10.40          $20,748.00
Clifford, P.C.
                                 Equity
                             Technology &
  Bernadette
                  Partner          IP            2013          1,575.00        82.90          $130,567.50
   Coppola
                              Transactions
   Hannah
                  Partner    Restructuring       2015          1,595.00         6.50          $10,367.50
  Crawford
                               Antitrust/
 Sion Davies      Partner                        2016          1,575.00         5.10           $8,032.50
                              Competition
Tabitha J. De                 Litigation -
                  Partner                        2015          1,435.00       103.30          $148,235.50
   Paulo                        General
Anthony M.                    Corporate -
                  Partner                        2014          1,595.00        75.80          $120,901.00
  Del Rio                      Healthcare
Michael Ehret     Partner       Taxation         2001          1,895.00       153.60          $291,072.00
                             Technology &
Emma L. Flett     Partner          IP            2009          2,115.00         5.40          $11,421.00
                              Transactions
  Susan D.
                  Partner    Restructuring       1988          1,600.00         6.10           $9,760.00
   Golden
                              International
 Luci Hague       Partner                        2015          1,575.00         0.40            $630.00
                                  Trade
                               Corporate -
 Kate Hardey      Partner                        2003          1,995.00        49.00          $97,755.00
                               Healthcare
                               Corporate -
 Erik Hepler      Partner                        1990          2,115.00         0.20            $423.00
                             Debt Finance
   Andrew                      Corporate -
                  Partner                        2009          1,995.00         3.00           $5,985.00
Idrizovic, P.C.              Debt Finance
  Partha Kar      Partner    Restructuring       2002          2,305.00        19.10          $44,025.50
                               Litigation -
Sarah Kimmer      Partner                        2015          1,365.00         2.00           $2,730.00
                                 General
                             Technology &
Daniel Lewis,
                  Partner           IP           2008          1,910.00        31.70          $60,547.00
    P.C.
                              Transactions
   Mario                      International
                  Partner                        1997          2,400.00         0.20            $480.00
Mancuso, P.C.                     Trade
                               Corporate -
Sean McClay       Partner                        2018          1,575.00         8.50          $13,387.50
                             Debt Finance
Mark McKane,                   Litigation -
                  Partner                        1999          2,065.00         6.00          $12,390.00
    P.C.                         General
    Alisa         Partner      Litigation -      2015          1,595.00        52.90          $84,375.50


                                                     5
                    Case 24-11217-BLS          Doc 742      Filed 11/13/24   Page 6 of 42




                                                                Hourly
                                                                             Hours Billed
   Attorney                                      Date of      Billing Rate                      Fees Billed
                   Position    Department                                      In this
    Name                                        Admission        In this                    In this Application
                                                                             Application
                                                              Application
  Melekhina                     General
James Morgan       Partner      Taxation          2004          2,445.00         2.90           $7,090.50
  Mavnick
                   Partner      Taxation          2008          2,265.00         0.50           $1,132.50
   Nerwal
                                 ECEB -
  Maureen D.
                   Partner      Employee          1998          2,115.00        18.50          $39,127.50
   O’Brien
                                 Benefits
 Rakesh Patel      Partner       Taxation         2000          1,665.00         2.50           $4,162.50
  Evangelia                   ECEB - Labor/
                   Partner                        2016          1,575.00        26.10          $41,107.50
   Podaras                     Employment
                                 ECEB -
Scott D. Price,
                   Partner      Executive         1998          2,245.00         2.90           $6,510.50
     P.C.
                              Compensation
  William T.                    Litigation -
                   Partner                        2004          1,695.00         0.80           $1,356.00
     Pruitt                      General
Jay M. Ptashek,                 Corporate -
                   Partner                        1993          2,245.00         2.00           $4,490.00
     P.C.                      Debt Finance
                              ECEB - Labor/
  Risa Salins      Partner                        2002          2,115.00        21.10          $44,626.50
                               Employment
Yusuf Salloum      Partner     Restructuring      2018          1,595.00       157.20          $250,734.00
                                Corporate -
    Anna
                   Partner        Capital         2002          1,315.00         7.20           $9,468.00
  Schwander
                                 Markets
                              Technology &
  Noah Shier       Partner           IP           2017          1,575.00         9.50          $14,962.50
                               Transactions
                                Corporate -
Jessica H. Sicsu   Partner    M&A/Private         2002          1,745.00         0.70           $1,221.50
                                  Equity
Josh Sussberg,
                   Partner    Restructuring       2004          2,305.00         7.10          $16,365.50
     P.C.
Paul D. Tanaka,               Environment -
                   Partner                        2003          2,115.00        16.30          $34,474.50
     P.C.                     Transactional
  Michael D.                    Antitrust/
                   Partner                        2010          1,695.00         0.60           $1,017.00
    Thorpe                     Competition
                               Corporate -
  Steve Toth       Partner    M&A/Private         2005          1,820.00       332.50          $605,150.00
                                 Equity
    Sarah
                   Partner    Restructuring       2004          1,575.00         5.30           $8,347.50
  Ullathorne
   Nicholas
                   Partner      Taxation          2017          1,665.00       137.70          $229,270.50
   Warther
   Cristina
                   Partner    Restructuring       2005          1,665.00        21.50          $35,797.50
   Weidner
   Dennis          Partner     Corporate -        2008          2,025.00         1.50           $3,037.50


                                                      6
                      Case 24-11217-BLS           Doc 742        Filed 11/13/24       Page 7 of 42




                                                                      Hourly
                                                                                     Hours Billed
  Attorney                                           Date of        Billing Rate                               Fees Billed
                   Position      Department                                            In this
   Name                                             Admission          In this                             In this Application
                                                                                     Application
                                                                    Application
   Williams                          Healthcare
  Spencer A.
                      Partner    Restructuring            2013        1,685.00             281.70             $474,664.50
 Winters, P.C.
   Sara B.
                      Partner         Taxation            2003        2,445.00             69.60              $170,172.00
Zablotney, P.C.
                            Totals                                                        6,980.30           $9,146,016.00


                   Summary of Hours by Paraprofessionals Billed In Interim Fee Period

                                                               Hourly
                                                                            Hours Billed
       Professional                                          Billing Rate                                Fees Billed
                           Position       Department                          In this
          Name                                                  In this                              In this Application
                                                                            Application
                                                             Application
                            Junior         Litigation -
      Stephanie Choi                                             355.00            58.60                $20,803.00
                           Paralegal        General
         Georgia            Junior
                                          Restructuring          355.00            0.50                   $177.50
         Meadow            Paralegal
                                         Technology &
     Ashley Brittanie       Junior
                                               IP                355.00            0.70                   $248.50
         Miller            Paralegal
                                          Transactions
                            Junior
      Tanzila Zomo                        Restructuring          355.00            65.90                $23,394.50
                           Paralegal
                                         Technology &
      Lauren Austgen       Paralegal           IP                435.00            1.50                   $652.50
                                          Transactions
      Amy Donahue          Paralegal     Restructuring           525.00            38.20                $20,055.00
      Julia R. Foster      Paralegal     Restructuring           525.00            66.30                $34,807.50
                                          Litigation -
      Angela Leonard       Paralegal                             625.00            26.90                $16,812.50
                                            General
                                         Technology &
        Michelle L.
                           Paralegal           IP                625.00            51.00                $31,875.00
         Nowicki
                                          Transactions
       Robert Orren        Paralegal     Restructuring           625.00            0.50                   $312.50
                                          Corporate -
       Henry Rosas         Paralegal                             625.00            0.50                   $312.50
                                         Debt Finance
                                         Technology &
        Barbara M.
                           Paralegal           IP                435.00            3.80                  $1,653.00
          Siepka
                                          Transactions
                                         Technology &
       Hayley Smith        Paralegal           IP                625.00            2.00                  $1,250.00
                                          Transactions
                                         Technology &
       Rob Soneson         Paralegal                             625.00            10.00                 $6,250.00
                                               IP



                                                             7
                   Case 24-11217-BLS             Doc 742    Filed 11/13/24   Page 8 of 42




                                                          Hourly
                                                                       Hours Billed
   Professional                                         Billing Rate                      Fees Billed
                        Position       Department                        In this
      Name                                                 In this                    In this Application
                                                                       Application
                                                        Application
                                Transactions
      Michael Y.   Support       Conflicts
                                                            395.00        24.00           $9,480.00
        Chan        Staff         Analysis
       Matthew     Support       Conflicts
                                                            340.00         5.00           $1,700.00
       Cooper       Staff         Analysis
                   Support       Conflicts
  Marta Dudyan                                              340.00        25.00           $8,500.00
                    Staff         Analysis
  Shaun Patrick    Support      Presentation
                                                            495.00         4.30           $2,128.50
      Kelly         Staff         Design
                   Support       Conflicts
   Eric Nyberg                                              340.00        22.50           $7,650.00
                    Staff         Analysis
                Totals for Paraprofessionals                             407.20          $188,062.50


                               Interim Compensation By Project Category

Matter
                        Project Category Description                   Total Hours             Total Fees
Number
  4                           Chapter 11 Filing                           429.70              $468,189.00
  5                    Corporate & Governance Matters                     127.50              $142,227.00
  6            Disclosure Statement, Plan, and Confirmation               272.00              $280,303.00
  7                   DIP Financing and Cash Collateral                   281.70              $358,618.50
  8                           Cash Management                              4.60                $5,548.00
  9                         Automatic Stay Issues                          3.10                $3,069.50
               Asset Sales/Section 363 Issues: Use, Sale and
  10
                          Disposition of Property
                                                                         3,882.40            $5,242,847.00
  11               Executory Contracts and Unexpired Leases                70.70              $78,689.50
  12                         Business Operations                          103.20              $118,732.50
  13                        Claims Administration                          55.70              $58,921.50
  14                  Schedules and Statements (SOFAs)                     86.60              $104,485.00
  15               Creditor and Stakeholder Communications                 32.30              $32,215.50
  16               U.S. Trustee Matters and Communication                  31.90              $38,906.50
  17                                Hearings                               28.00              $39,653.00
  18                     Insurance and Surety Matters                       5.40               $5,713.00
  19                                Utilities                              17.10              $18,139.50
  20                               Tax Matters                            645.70              $946,173.00
  21                         Case Administration                          327.10              $327,834.00
  22                          Retention – K&E                             332.90              $314,096.00


                                                        8
         Case 24-11217-BLS           Doc 742    Filed 11/13/24   Page 9 of 42




Matter
            Project Category Description                  Total Hours            Total Fees
Number
  23            Retention – Non-K&E                          142.80              $152,778.50
  24               Vendor Matters                             54.80              $60,255.00
  25                    Litigation                           237.50              $256,302.50
  27             Non-Working Travel                           33.30              $46,201.50
  28         Creditors’ Committee Matters                    104.60              $118,611.00
  29         Employee and Labor Matters                       76.90              $115,569.00
                Total                                       7,387.50            $9,334,078.50




                                            9
                 Case 24-11217-BLS     Doc 742      Filed 11/13/24     Page 10 of 42




                                    Interim Expense Summary

                                                                        Unit Cost
             Expense                    Vendor (if any)                                 Amount
                                                                     (if applicable)
Third Party Telephone Charges                                                               $0
Standard Copies or Prints             Kirkland & Ellis LLP               $0.10           $467.70
Tabs/Indexes/Dividers                 Kirkland & Ellis LLP                                  $0
Color Copies or Prints                                                                  $1,161.60
Scanned Images                        Kirkland & Ellis LLP                                  $0
Local Transportation                                                                     $855.10
Travel Expense                                                                          $3,961.94
Airfare                                                                                 $4,803.29
Transportation to/from airport                                                         $1,904.94
Travel Meals                                                                             $369.65
Court Reporter Fee/Deposition                                                             $72.90
Filing Fees                                                                                 $0
Other Court Costs and Fees                                                             $32,208.66
Working Meals/K&E Only                                                                  $1,046.19
Outside Retrieval Service                                                               $2,357.56
Computer Database Research                                                             $1,940.62
Westlaw Research                                                                        $5,484.51
LexisNexis Research                                                                      $684.41
Overtime Transportation                                                                 $1,122.65
Overtime Meals - Attorney                                                              $1,063.78
Secretarial Overtime                  Kirkland & Ellis LLP                                  $0
Document Services Overtime            Kirkland & Ellis LLP                                  $0
Rental Expenses                                                                         $5,142.16
Overnight Delivery – Hard                                                                $242.67
Computer Database Research - Soft                                                        $109.90
Total                                                                                  $65,000.23




                                               10
                 Case 24-11217-BLS             Doc 742        Filed 11/13/24        Page 11 of 42




                         IN THE UNITED STATES BANKRUPTCY COURT
                              FOR THE DISTRICT OF DELAWARE

                                                         )
In re:                                                   )    Chapter 11
                                                         )
VYAIRE MEDICAL, INC., et al.,1                           )    Case No. 24-11217 (BLS)
                                                         )
                            Debtors.                     )    (Jointly Administered)
                                                         )

          FIRST INTERIM FEE APPLICATION OF KIRKLAND & ELLIS LLP
         AND KIRKLAND & ELLIS INTERNATIONAL LLP, ATTORNEYS FOR
    THE DEBTORS AND DEBTORS IN POSSESSION, FOR THE INTERIM FEE PERIOD
          FROM JUNE 9, 2024 THROUGH AND INCLUDING AUGUST 31, 2024

          Kirkland & Ellis LLP and Kirkland & Ellis International LLP (together, “K&E”),

attorneys for the above-captioned debtors and debtors in possession (collectively, the “Debtors”),

hereby submits its first interim fee application (the “Fee Application”) for allowance of

compensation for professional services provided in the amount of $9,309,620.32 and

reimbursement of actual and necessary expenses in the amount of $65,000.23 that K&E incurred

for the period from June 9, 2024 through August 31, 2024 (the “Fee Period”).2 In support of this

Fee Application, K&E submits the declaration of Spencer A. Winters, president of Spencer A.

Winters, P.C., a partner of K&E, (the “Winters Declaration”), which is attached hereto as



1
      The last four digits of Debtor Vyaire Medical, Inc.’s federal tax identification number are 6495. A complete list
      of each of the Debtors in these chapter 11 cases and each such Debtor’s federal tax identification number may
      be obtained on the website of the Debtors’ claims and noticing agent at https://omniagentsolutions.com/Vyaire.
      The location of Debtor Vyaire Medical, Inc.’s principal place of business and the Debtors’ service address in
      these chapter 11 cases is 26125 North Riverwoods Boulevard, Mettawa, Illinois, USA 60045.
2
      Capitalized terms used but not otherwise defined have the meaning ascribed to them in the Joint Chapter 11
      Plan of Vyaire Medical, Inc. and its Debtor Affiliates [Docket No. 581] (the “Plan”), the Motion of Debtors for
      Entry of an Order (I) Approving the Adequacy of the Disclosure Statement on an Interim and Final Basis,
      (II) Scheduling a Combined Disclosure Statement Approval and Plan Confirmation Hearing, (III) Approving
      the Solicitation and Notice Procedures, (IV) Approving the Combined Hearing Notice, and (V) Grating Related
      Relief [Docket No. 520] (the “Disclosure Statement Motion”) and the Disclosure Statement for the Joint
      Chapter 11 Plan of Vyaire Medical, Inc. and its Debtor Affiliates [Docket No. 582] (the “Disclosure
      Statement”), as applicable.
             Case 24-11217-BLS           Doc 742       Filed 11/13/24   Page 12 of 42




Exhibit A and incorporated by reference. In further support of this Fee Application, K&E

respectfully states as follows.

                                     Jurisdiction and Venue

       1.      The United States District Court for the District of Delaware has jurisdiction over

this matter pursuant to 28 U.S.C. § 1334, which was referred to the United States Bankruptcy

Court for the District of Delaware (the “Court”) under 28 U.S.C. § 157 and the Amended

Standing Order of Reference from the United States District Court for the District of Delaware,

dated February 29, 2012. The Debtors confirm their consent, pursuant to rule 9013-1(f) of the

Local Rules of Bankruptcy Practice and Procedure of the United States Bankruptcy Court for the

District of Delaware (the “Local Rules”), to the entry of a final order by the Court in connection

with this Fee Application to the extent that it is later determined that the Court, absent consent of

the parties, cannot enter final orders or judgments in connection herewith consistent with Article

III of the United States Constitution.

       2.      Venue is proper pursuant to 28 U.S.C. §§ 1408 and 1409.

       3.      The bases for the relief requested herein are sections 330 and 331 of title 11 of the

United States Code (the “Bankruptcy Code”), rule 2016 of the Federal Rules of Bankruptcy

Procedure (the “Bankruptcy Rules”), rule 2016 of the Local Rules, and the Order (I)

Establishing Procedures for Interim Compensation and Reimbursement of Expenses for Retained

Professionals and (II) Granting Related Relief [Docket No. 218] (the “Interim Compensation

Order”).

                                           Background

       4.      On June 9, 2024, (the “Petition Date”), Vyaire Medical, Inc. and certain of its

subsidiaries filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code. The

Debtors are operating their businesses and managing their properties as debtors-in-possession


                                                   2
             Case 24-11217-BLS          Doc 742       Filed 11/13/24    Page 13 of 42




pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. On June 11, 2024, the Court

entered an order [Docket No. 84] authorizing the joint administration and procedural

consolidation of the Debtors’ chapter 11 cases pursuant to Bankruptcy Rule 1015(b). No request

has been made for the appointment of a trustee or examiner in these chapter 11 cases. On

June 26, 2024, the United States Trustee for the District of Delaware (the “U.S. Trustee”)

appointed an official committee of unsecured creditors pursuant to section 1102 of the

Bankruptcy Code (the “Committee”) [Docket No. 121].

       5.      A description of the Debtors’ business, the reasons for commencing the chapter

11 cases, and the relief sought from the Court to allow for a smooth transition into chapter 11 are

set forth in the Declaration of John Bibb, Group Chief Executive Officer of Vyaire Medical, Inc.,

in Support of Debtors’ Chapter 11 Petitions and First Day Motions, filed on June 10, 2024

[Docket No. 15] and incorporated herein by reference.

       6.      On July 9, 2024, the Court entered the Interim Compensation Order, which sets

forth the procedures for interim compensation and reimbursement of expenses for all

professionals in these cases.

                                      Preliminary Statement

       7.      During the Fee Period, K&E represented the Debtors professionally and

diligently, advising them on a variety of complex matters and issues, as a result of which the

Debtors took action to maximize the value of their estates for the benefit of all parties in interest.

K&E provided the variety of services during the Fee Period, including:

               (a)     stabilized the Debtors’ business operations following their transition into
                       chapter 11 by obtaining relief to continue operating in the ordinary course
                       of business, including securing approval of all “first day” and “second
                       day” motions and related relief after resolving issues raised by the U.S.
                       Trustee, the Committee, and other stakeholders;




                                                  3
            Case 24-11217-BLS        Doc 742          Filed 11/13/24   Page 14 of 42




              (b)     obtained approval of debtor-in-possession financing and the use of cash
                      collateral;

              (c)     prepared and filed the Debtors’ Schedules of Assets and Liabilities and
                      Statements of Financial Affairs;

              (d)     implemented a number of prudent, cost-cutting measures to optimize the
                      Debtors’ go-forward operations, including rejecting certain burdensome
                      executory contracts;

              (e)     obtained approval of bidding procedures [Docket No. 249] (the “Bidding
                      Procedures Order”), allowing the Debtors to solicit the best and highest
                      offers for going-concern sales of their businesses and continue their
                      comprehensive marketing process related thereto on a postpetition basis;

              (f)     prepared for and conducted a multi-day auction with multiple bidders and
                      several rounds of bidding with respect to the Debtors’ “Vents” business
                      unit;

              (g)     prepared, drafted, and negotiated definitive documentation in connection
                      with multiple multi-jurisdictional carveout sale transactions;

              (h)     arranged transition of the Debtors’ assets and businesses to the buyers,
                      setting up transition service agreements to ensure regulatory compliance
                      and continuity of vital services to patients;

              (i)     negotiated with numerous executory contract and unexpired lease
                      counterparties with respect to cure amounts and adequate assurance
                      packages in connection with the sale transactions;

              (j)     negotiated, drafted, and filed the Plan and Disclosure Statement; and

              (k)     on October 2, 2024 obtained Court approval to commence solicitation.

       8.     Given these accomplishments and the complexities of the Debtors’ business and

restructuring, K&E submits that the compensation and expense reimbursement sought herein for

the necessary and beneficial professional services K&E provided to the Debtors during the Fee

Period are reasonable and appropriate, commensurate with the scale, nature, and complexity of

these chapter 11 cases, and should be approved.

                                    Case Status Summary

       9.     The Debtors commenced these chapter 11 cases in an effort to consummate one or



                                                  4
             Case 24-11217-BLS        Doc 742       Filed 11/13/24   Page 15 of 42




more sale transactions to maximize value for all stakeholders and allow their business to survive

as a going concern. Faced with increasing liquidity constraints and in response to challenging

macroeconomic conditions and internal business challenges, the Debtors engaged with their

prepetition secured lenders to obtain DIP financing that would permit the Debtors to stabilize the

business operations, continue their prepetition sale process on a post-petition basis, and

consummate sale transaction(s) through a chapter 11 process. On June 9, 2024, the Company

and the consenting stakeholders (the “Consenting Stakeholders” and together with the Company,

the “RSA Parties”) entered into the Restructuring Support Agreement (the “RSA”), whereby the

RSA Parties agreed, subject to the terms and conditions thereof, to support the sale process,

consummation of any sale transactions, and to wind down the remaining Company.

       10.     Having reached consensus with the Consenting Stakeholders, the Debtors

commenced these cases with a DIP Facility of $45 million of new money, filed a motion to

approve certain bidding procedures, and obtained customary first-day relief to ensure a soft

landing in chapter 11.

       11.     Shortly after the cases commenced, the official committee of unsecured creditors

was formed by the U.S. Trustee and retained counsel. The Debtors worked with counsel to the

Committee to meet document and diligence requests.

       12.     Since the filing, the Debtors worked with K&E and their other advisors to

continue their robust prepetition marketing process on a postpetition basis, which ultimately

culminated in the Sale Transactions with Trudell (the “Trudell Transaction”) and Zoll (the “Zoll

Transaction”). The Sale Transactions resulted in $90,500,000 of cash, independent of certain

assumed liabilities.




                                                5
             Case 24-11217-BLS        Doc 742       Filed 11/13/24   Page 16 of 42




       13.    On September 4, 2024, the Court approved the Debtors’ entry into the Sale

Transactions. Following the Court’s approval of the Debtors’ entry into the Sale Transactions,

the Debtors participated in significant negotiation of the Sale Transaction Documentation with

both Zoll and Trudell.

       14.    On September 11, 2024, the Debtors filed the Joint Chapter 11 Plan of Vyaire

Medical, Inc. and its Debtor Affiliates (as amended, modified, or supplemented, the “Plan”)

[Docket No. 518] and the Disclosure Statement for the Joint Chapter 11 Plan of Vyaire Medical,

Inc. and its Debtors Affiliates (as amended, modified, or supplemented, the “Disclosure

Statement”) [Docket No. 519]. On September 30, 2024, the Debtors filed amended versions of

the Plan [Docket No. 581] and Disclosure Statement [Docket No. 582].

       15.    On October 11, 2024, the Debtors closed the Zoll Transaction, and have since

progressed significantly towards closing the Trudell Transaction.

                               The Debtors’ Retention of K&E

       16.    On August 5, 2024, the Court entered the Order Authorizing the Retention and

Employment of Kirkland & Ellis LLP and Kirkland & Ellis International LLP as Attorneys for

the Debtors and Debtors in Possession Effective as of June 9, 2024 [Docket No. 350]

(the “Retention Order”), attached hereto as Exhibit B and incorporated by reference. The

Retention Order authorizes the Debtors to compensate and reimburse K&E in accordance with

the Bankruptcy Code, the Bankruptcy Rules, the Local Bankruptcy Rules, and the Interim

Compensation Order. The Retention Order also authorizes the Debtors to compensate K&E at

K&E’s hourly rates charged for services of this type and to reimburse K&E for K&E’s actual

and necessary out-of-pocket expenses incurred, subject to application to this Court.      The

particular terms of K&E’s engagement are detailed in the engagement letter by and between

K&E and the Debtors, effective as of June 9, 2024 and attached hereto as Exhibit C


                                                6
              Case 24-11217-BLS             Doc 742         Filed 11/13/24      Page 17 of 42




(the “Engagement Letter”).

        17.      The Retention Order authorizes K&E to provide the following services consistent

with and in furtherance of the services enumerated above:

                 a.      advising the Debtors with respect to their powers and duties as
                         debtors-in-possession in the continued management and operation of their
                         businesses and properties;

                 b.      preparing pleadings, including motions, applications, answers, orders,
                         reports, and papers necessary or otherwise beneficial to the administration
                         of the Debtors’ estates and consistent with the services identified in the
                         Retention Order;

                 c.      appearing before the Court and any appellate courts to represent the
                         interests of the Debtors’ estates before those courts in connection with the
                         services in the Retention Order; and

                 d.      performing all other legal services reasonably necessary or otherwise
                         beneficial for the Debtors in connection with these chapter 11 cases.

                                        Disinterestedness of K&E

        18.      To the best of the Debtors’ knowledge and as disclosed in the Declaration of

Spencer A. Winters, in Support of the Debtors’ Application for Entry of an Order Authorizing the

Retention and Employment of Kirkland & Ellis LLP and Kirkland & Ellis International LLP as

Attorneys for the Debtors and Debtors in Possession Effective as of June 9, 2024

[Docket No. 236, Exhibit B] (as amended, supplemented, or otherwise modified from time to

time, the “K&E Declaration”),3 (a) K&E is a “disinterested person” within the meaning of

section 101(14) of the Bankruptcy Code, as required by section 327(a) of the Bankruptcy Code,

and does not hold or represent an interest adverse to the Debtors’ estates and (b) K&E has no

3
    K&E has also filed the Supplemental Declaration of Spencer A. Winters in Support of the Application of
    Debtors for Entry of an Order Authorizing the Retention and Employment of Kirkland & Ellis LLP and
    Kirkland & Ellis International LLP as Attorneys for the Debtors and Debtors in Possession Effective as of June
    9, 2024 [Docket No. 326] and the Second Supplemental Declaration of Spencer A. Winters in Support of the
    Application of Debtors for Entry of an Order Authorizing the Retention and Employment of Kirkland & Ellis
    LLP and Kirkland & Ellis International LLP as Attorneys for the Debtors and Debtors in Possession Effective
    as of June 9, 2024 [Docket No. 603].



                                                        7
             Case 24-11217-BLS          Doc 742       Filed 11/13/24   Page 18 of 42




connection to the Debtors, their creditors, or other parties in interest, except as may be disclosed

in the K&E Declaration.

       19.     K&E may have in the past represented, may currently represent, and likely in the

future will represent parties in interest in connection with matters unrelated to the Debtors in

these chapter 11 cases. In the K&E Declaration, K&E disclosed its connections to parties in

interest that it has been able to ascertain using its reasonable efforts. K&E will update the K&E

Declaration, as appropriate, if K&E becomes aware of relevant and material new information.

       20.     K&E performed the services for which it is seeking compensation on behalf of the

Debtors and their estates, and not on behalf of any committee, creditor, or other entity.

       21.     Except to the extent of the advance payments paid to K&E that K&E previously

disclosed to this Court in the K&E Declaration, K&E has received no payment and no promises

for payment from any source other than the Debtors for services provided or to be provided in

any capacity whatsoever in connection with these chapter 11 cases.

       22.     Pursuant to Bankruptcy Rule 2016(b), K&E has not shared, nor has K&E agreed

to share (a) any compensation it has received or may receive with another party or person other

than with the partners, counsel, and associates of K&E or (b) any compensation another person

or party has received or may receive.

                 Summary of Compliance with Interim Compensation Order

       23.     This Fee Application has been prepared in accordance with the Interim

Compensation Order.

       24.     K&E seeks interim compensation for professional services rendered to the

Debtors during the Fee Period in the amount of $9,309,620.32 and reimbursement of actual and

necessary expenses incurred in connection with providing such services in the amount of




                                                  8
               Case 24-11217-BLS             Doc 742         Filed 11/13/24      Page 19 of 42




$65,000.23.4 During the Fee Period, K&E attorneys and paraprofessionals expended a total of

7,387.50 hours for which compensation is requested.

         25.      In accordance with the Interim Compensation Order, as of the date hereof, K&E

has received payments totaling $7,519,697.76 ($7,454,697.53 of which was for services provided

and $65,000.23 of which was for reimbursement of expenses) for the Fee Period. Accordingly,

by this Fee Application, and to the extent such amounts have not been paid by the time of the

hearing on this Fee Application, K&E seeks payment of the remaining $1,854,922.79, which

amount represents the entire amount of unpaid fees and expenses incurred between June 9, 2024

and August 31, 2024.5

                            Fees and Expenses Incurred During Fee Period

A.       Customary Billing Disclosures.

         26.      K&E’s hourly rates are set at a level designed to compensate K&E fairly for the

work of its attorneys and paraprofessionals and to cover fixed and routine expenses. The hourly

rates and corresponding rate structure utilized by K&E in these chapter 11 cases are equivalent to

the hourly rates and corresponding rate structure used by K&E for other restructuring matters, as

well as similar complex corporate, securities, and litigation matters whether in court or

otherwise, regardless of whether a fee application is required. The rates and rate structure reflect

that such restructuring and other complex matters typically are national in scope and typically


4
     In connection with discussions with the U.S. Trustee, the Debtors have agreed to deduct $8,751.59 from the
     holdback amount in connection with certain fees granted in the First Monthly Application and $15,706.59 from
     the aggregate amount in connection with certain fees and expenses requested in the Third Monthly Fee
     Application of Kirkland & Ellis LLP and Kirkland & Ellis International LLP, Attorneys for the Debtors and
     Debtors in Possession, for the Period from August 1, 2024, Through and Including August 31, 2024 [Docket
     No. 615], as reflected in the Certification of Counsel Regarding Third Monthly Fee Application of Kirkland &
     Ellis LLP and Kirkland & Ellis International LLP, Attorneys for the Debtors and Debtors in Possession, for the
     Period from August 1, 2024 Through and Including August 31, 2024 [No Order Required] [Docket No. 697].
5
     This amount also reflects the 20% holdback for the Fee Period, excluding the agreed upon reductions for the
     June fees and expenses.



                                                         9
               Case 24-11217-BLS       Doc 742        Filed 11/13/24   Page 20 of 42




involve great complexity, high stakes, and severe time pressures. Additionally, the Debtors are

subject to multiple domestic and international regulatory regimes requiring specialized review

and consideration in connection with any potential transactions. For the convenience of the

Court and all parties in interest, attached hereto as Exhibit D is K&E’s budget and staffing plan

for this Fee Period (the “Budget and Staffing Plan”) and attached hereto as Exhibit E is a

summary of blended hourly rates for timekeepers who billed to non-bankruptcy matters and

blended hourly rates for timekeepers who billed to the Debtors during the Fee Period.

B.     Fees Incurred During Fee Period.

       27.      In the ordinary course of K&E’s practice, K&E maintains computerized records

of the time expended to render the professional services required by the Debtors and their estates.

For the convenience of the Court and all parties in interest, attached hereto as Exhibit F is a

summary of fees incurred and hours expended during the Fee Period, setting forth the following

information:

       (a)      the name of each attorney and paraprofessional for whose work on these
                chapter 11 cases compensation is sought;

       (b)      each attorney’s year of bar admission and area of practice concentration;

       (c)      the aggregate time expended and fees billed by each attorney and each
                paraprofessional during the Fee Period;

       (d)      the hourly billing rate for each attorney and each paraprofessional at K&E’s
                current billing rates;

       (e)      the hourly billing rate for each attorney and each paraprofessional as disclosed in
                the first interim application;

       (f)      the number of rate increases since the inception of the case; and

       (g)      a calculation of total compensation requested using the rates disclosed in the
                Debtors’ Application for Entry of an Order Authorizing the Retention and
                Employment of Kirkland & Ellis LLP and Kirkland & Ellis International LLP as
                Attorneys for the Debtors and Debtors in Possession Effective as of June 9, 2024
                [Docket No. 236] (the “Retention Application”).



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               Case 24-11217-BLS             Doc 742        Filed 11/13/24      Page 21 of 42




C.       Expenses Incurred During Fee Period.

         28.      In the ordinary course of K&E’s practice, K&E maintains a record of expenses

incurred in the rendition of the professional services required by the Debtors and their estates and

for which reimbursement is sought.              K&E currently charges $0.16 per page for standard

duplication in its offices in the United States. Notwithstanding the foregoing and consistent with

the Local Bankruptcy Rules, K&E charged no more than $0.10 per page for standard duplication

services in these chapter 11 cases. K&E does not charge its clients for incoming facsimile

transmissions.

         29.      For the convenience of the Court and all parties in interest, attached hereto as

Exhibit G is a summary for the Fee Period, setting forth the total amount of reimbursement

sought with respect to each category of expenses for which K&E is seeking reimbursement.

                   Summary of Legal Services Rendered During the Fee Period

         30.      As discussed above, during the Fee Period, K&E provided extensive and

important professional services to the Debtors in connection with these chapter 11 cases. These

services were often performed under severe time constraints and were necessary to address a

multitude of critical issues both unique to these chapter 11 cases and typically faced by large,

international corporate debtors in similar cases of this magnitude and complexity.

         31.      To provide a meaningful summary of K&E’s services provided on behalf of the

Debtors and their estates, K&E has established, in accordance with its internal billing

procedures, certain subject matters categories (each, a “Matter Category”) in connection with

these chapter 11 cases. The following is a summary of the fees and hours billed for each Matter

Category in the Fee Period:6


6
     In certain instances, K&E may have billed the same amount of fees, but different number of hours to different
     Matter Categories. This difference is the result of different staffing of each such Matter Category.



                                                       11
              Case 24-11217-BLS              Doc 742       Filed 11/13/24     Page 22 of 42




 Matter            Matter Category                    Hours                      Total Compensation
 Number             Description               Budgeted         Billed        Budgeted             Billed
                 Chapter 11 Bankruptcy
    4              Filing and First Day       160 - 248       429.70     $180,000 - $280,000   $468,189.00
                        Preparation
               Corporate and Governance
    5                                           60 - 93       127.50     $90,000 - $140,000    $142,227.00
                          Matters
               Disclosure Statement, Plan,
    6                                         257 - 400       272.00     $270,000 - $420,000   $280,303.00
                    and Confirmation
                 DIP Financing and Cash
    7                                         153 - 237       281.70     $180,000 - $280,000   $358,618.50
                         Collateral
    8               Cash Management            79 - 122        4.60      $90,000 - $140,000     $5,548.00
    9             Automatic Stay Issues        68 - 106        3.10      $67,500 - $105,000     $3,069.50
                 Asset Sales/Section 363
                                                                            $1,575,000 -
   10             Issues: Use, Sale, and     1,080 - 1,680    3,882.40                         $5,242,847.00
                                                                             $2,450,000
                 Disposition of Property
                Executory Contracts and
   11                                          88 - 136        70.70     $90,000 - $140,000     $78,689.50
                    Unexpired Leases
   12              Business Operations         95 - 147       103.20     $139,500 - $217,000   $118,732.50
   13            Claims Administration         66 - 102       55.70      $74,250 - $115,500    $58,921.50
                Schedules and Statements
   14                                           61 - 95        86.60     $68,850 - $107,100    $104,485.00
                         (SOFAs)
                Creditor and Stakeholder
   15                                           46 - 71        32.30      $58,050 - $90,300     $32,215.50
                     Communications
                U.S. Trustee Matters and
   16                                           53 - 82        31.90     $73,800 - $114,800     $38,906.50
                     Communication
   17                    Hearings              61 - 94         28.00      $76,500 - $119,000    $39,653.00
   18         Insurance and Surety Matters     59 - 91         5.40       $67,500 - $105,000    $5,713.00
   19                     Utilities            59 - 91         17.10      $67,500 - $105,000   $18,139.50
   20                  Tax Matters            107 - 166       645.70     $135,000 - $210,000   $946,173.00
   21              Case Administration        188 - 292       327.10     $225,000 - $350,000   $327,834.00
   22            K&E Fee Applications         266 - 414       332.90     $405,000 - $630,000   $314,096.00
              Non-K&E Fee / Employment
   23                                          99 - 154       142.80     $132,750 - $206,500   $152,778.50
                       Applications
   24                Vendor Matters            96 - 149        54.80     $126,000 - $196,000   $60,255.00
   25                    Litigation           101 - 156       237.50     $135,000 - $210,000   $256,302.50
   27          Non-Working Travel Time         12 - 17         33.30      $11,250 - $17,500    $46,201.50
   28         Creditors’ Committee Issues      34 - 53        104.60      $45,000 - $70,000    $118,611.00
   29         Employee and Labor Matters      73 - 114         76.90      $88,650 - $137,900   $115,569.00

        32.     The following is a summary, by Matter Category, of the most significant

professional services provided by K&E during the Fee Period. This summary is organized in

accordance with K&E’s internal system of matter numbers.                        The detailed descriptions



                                                      12
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demonstrate that K&E was heavily involved in performing services for the Debtors on a daily

basis, often including night and weekend work, to meet the needs of the Debtors’ estates in these

chapter 11 cases. A schedule setting forth a description of the Matter Categories utilized in this

case, the number of hours expended by K&E partners, associates, and paraprofessionals by

matter, and the aggregate fees associated with each matter is attached hereto as Exhibit H.

       33.     In addition, K&E’s computerized records of time expended providing

professional services to the Debtors and their estates are attached hereto as Exhibit I, and K&E’s

records of expenses incurred during the Fee Period in the rendition of professional services to the

Debtors and their estates are attached as Exhibit J.

               (a)     Chapter 11 Bankruptcy Filing and First Day Preparation [Matter No. 4]

                       Total Fees:  $468,189.00
                       Total Hours: 429.70

       34.     This   Matter    Category    includes    time   spent   by   K&E     attorneys   and

paraprofessionals providing services related to the filing of the Debtors’ chapter 11 petitions and

various “first day” pleadings and related notices during the initial days of these chapter 11 cases,

including, without limitation, (a) reviewing and revising the Debtors’ petitions and “first day”

motions, proposed orders, affidavits and notices; and (b) preparing for the “first day” hearing,

including drafting hearing notes and related materials and preparing potential witnesses in

connection with certain of the first day motions.

       35.     Specifically, the Debtors filed several motions seeking orders authorizing the

Debtors to pay various prepetition claims. Entry of these orders eased the strain on the Debtors’

relationships with employees, vendors, customers, and taxing authorities as a consequence of the

commencement of these chapter 11 cases. Among other things, these orders authorized the

Debtors to (a) pay certain critical vendors, suppliers, and lien claimants, (b) pay certain



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             Case 24-11217-BLS         Doc 742       Filed 11/13/24    Page 24 of 42




prepetition employee wages and benefits, (c) maintain cash management systems, (d) use

prepetition bank accounts, checks, and other business forms, (e) make tax payments to federal,

local, and state taxing authorities, (f) prohibit utility companies from discontinuing services, and

(g) maintain prepetition insurance policies and enter into new insurance policies.

               (b)     Corporate and Governance [Matter No. 5]

                       Total Fees:  $142,227.00
                       Total Hours: 127.50

       36.     This   Matter    Category    includes    time   spent   by   K&E      attorneys   and

paraprofessionals advising the Debtors and the Board of Directors (the “Board”) regarding

corporate governance issues related to the Debtors’ restructuring and sale transactions.

Specifically, K&E attorneys and paraprofessionals spent time:

                       (i)     complying with corporate governance requirements, including
                               drafting and revising resolutions, certificates, amendments to
                               corporate documents, and minutes from board meetings, as
                               necessary;

                       (ii)    preparing for and participating in various meetings with the
                               Special Committee and senior management in connection with key
                               issues and events regarding these chapter 11 cases; and

                       (iii)   providing updates to the Debtors and their advisors regarding the
                               foregoing activities.

               (c)     Disclosure Statement, Plan, and Confirmation [Matter No. 6]

                       Total Fees:  $280,303.00
                       Total Hours: 272.00
       37.     This   Matter    Category    includes    time   spent   by   K&E      attorneys   and

paraprofessionals providing services related to developing a wind-down plan in connection with

these chapter 11 cases. Specifically, K&E attorneys and paraprofessionals spent time:

                       (i)     researching and analyzing legal and factual issues relevant to the
                               Plan and Disclosure Statement;




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                      (ii)     drafting, negotiating, revising, and filing the Plan, Disclosure
                               Statement, Disclosure Statement Motion, and all related filings to
                               the same;

                      (iii)    engaging with the U.S. Trustee, the Committee, the Prepetition
                               First Lien Lenders, the Prepetition Second Lien Lenders, the DIP
                               Lenders, and other key stakeholders relating to their comments to
                               the Plan, Disclosure Statement, Disclosure Statement Motion,
                               Solicitation Materials, and other related documents; and

                      (iv)     providing updates to the Debtors and their advisors regarding the
                               foregoing activities.

               (d)    DIP Financing and Cash Collateral [Matter No. 7]

                      Total Fees:  $358,618.50
                      Total Hours: 281.70

       38.     This   Matter    Category    includes    time   spent   by   K&E      attorneys   and

paraprofessionals securing postpetition financing and the consensual use of cash collateral,

which was necessary to both preserve the Debtors’ operations during these chapter 11 cases, as

well as to provide sufficient liquidity to administer these chapter 11 cases and bridge to

consummation of the transactions contemplated by the RSA and the Plan. K&E’s efforts were

critical in securing the consensual use of cash collateral and negotiating, documenting, and

closing on the Debtors’ DIP financing facility on favorable terms to provide the Debtors with the

necessary liquidity to fund the Debtors’ operations during these chapter 11 cases.

               (e)    Cash Management [Matter No. 8]

                      Total Fees:  $5,548.00
                      Total Hours: 4.60
       39.     This Matter Category includes time spent on a variety of tasks that were necessary

to ensure the continued operation and maintenance of the Debtors’ cash management systems

and DIP financing. Specifically, K&E attorneys and paraprofessionals spent time:

                      (i)      obtaining entry of interim and final orders authorizing the Debtors
                               to operate their pre-existing cash management systems and
                               perform intercompany transactions;


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                      (ii)     drafting materials related to the Debtors’ use of their cash
                               management systems; and

                      (iii)    analyzing and discussing the terms of the maintenance of the
                               Debtors’ cash management systems with the Debtors, the Debtors’
                               other professionals, and various stakeholders.

               (f)    Automatic Stay Issues [Matter No. 9]

                      Total Fees:  $3,069.50
                      Total Hours: 3.10

       40.     This   Matter    Category    includes    time   spent   by   K&E    attorneys     and

paraprofessionals providing services related to the imposition of the automatic stay.

               (g)    Asset Sales/Section 363 Issues: Use, Sale, and Disposition of Property
                      [Matter No. 10]

                      Total Fees:  $5,242,847.00
                      Total Hours: 3,882.40

       41.     This   Matter    Category    includes    time   spent   by   K&E    attorneys     and

paraprofessionals providing services related to the disposition of the Debtors’ assets.

Specifically, K&E attorneys and paraprofessionals spent time:

                      (i)      researching, drafting, negotiating, and seeking approval of the
                               Bidding Procedures Order;

                      (ii)     drafting declarations in support of the Bidding Procedures Order
                               and the Debtors’ marketing process;

                      (iii)    reviewing, revising, and negotiating non-disclosure agreements
                               with interested counterparties;

                      (iv)     drafting, reviewing, and negotiating asset purchase agreements;

                      (v)       reviewing and analyzing issues related to the sale and
                               communications with potential bidders related thereto;

                      (vi)     coordinating the Debtors’ marketing process with PJT Partners LP
                               (“PJT”), including corresponding with prospective bidders,
                               drafting non-disclosure agreements, reviewing, and analyzing
                               indications of interest, and making all necessary preparations to
                               obtain court approval of the sale transactions;



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                      (vii)   coordinating with local counsel, researching, and analyzing issues
                              regarding the various foreign jurisdictions where the Debtors
                              operate to ensure compliance with all applicable regulatory
                              regimes;

                      (viii) conducting a multi-day auction with regard to the Zoll Transaction;

                      (ix)    resolving objections to the Bidding Procedures Order and Sale
                              Transactions, as well as resolving objections to cures; and

                      (x)     advising and coordinating with the Debtors and the Debtors’
                              advisors with respect to the foregoing.

              (h)     Executory Contracts and Unexpired Leases [Matter No. 11]

                      Total Fees:  $78,689.50
                      Total Hours: 70.70

       42.    This Matter Category includes time spent by K&E attorneys examining issues

related to the Debtors’ executory contracts and unexpired leases. K&E attorneys spent time

researching, analyzing, renegotiating, or rejecting the Debtors’ obligations under their various

executory contracts and unexpired leases. Specifically, K&E attorneys spent time:

                      (i)     negotiating and coordinating with counterparties regarding issues
                              related to cure or adequate assurance;

                      (ii)    advising the Debtors with respect to their rights and obligations
                              under their executory contracts and unexpired leases under relevant
                              bankruptcy and nonbankruptcy law, including with respect to the
                              assumption and assignment of such executory contracts;

                      (iii)   researching and analyzing issues related thereto; and

                      (iv)    coordinating with the Debtors and various counterparties regarding
                              treatment of executory contracts, including cure amounts.

              (i)     Business Operations [Matter No. 12]

                      Total Fees:  $118,732.50
                      Total Hours: 103.20

       43.    It is important that the Debtors and their advisors create and implement an

all-encompassing and cohesive strategy for maintaining business operations with minimal



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disruptions during the course of the Debtors’ chapter 11 cases.              K&E attorneys and

paraprofessionals spent time developing a strategy with the Debtors to ensure a smooth transition

into chapter 11 and to ensure that going forward the business operations continue without

interruption. Specifically, K&E attorneys and paraprofessionals spent time strategizing with

management and the Debtors’ other advisors regarding the Debtors’ operations and business

plans and various domestic and international regulatory issues.

               (j)     Claims Administration [Matter No. 13]

                       Total Fees:  $58,921.50
                       Total Hours: 55.70

       44.     This Matter Category includes time K&E attorneys and paraprofessionals spent

on matters related to claims administration and claims-related issues.          Specifically, K&E

attorneys and paraprofessionals spent time:

                       (i)     researching and revising the Debtors’ bar date motion in
                               coordination with Cole Schotz, P.C. (“Cole Schotz”); and

                       (ii)    reviewing, analyzing, and researching certain claims asserted
                               against the Debtors.

               (k)     Schedules and Statements (SOFAs) [Matter No. 14]

                       Total Fees:  $104,485.00
                       Total Hours: 86.60
       45.     This   Matter    Category    includes    time   spent   by   K&E     attorneys   and

paraprofessionals providing services related to advising the Debtors, Omni Agent Solutions, Inc.

(“Omni”), and other advisors in connection with the preparation, review, revision, and filing of

the Debtors’ schedules of assets and liabilities and statements of financial affairs (the “Schedules

and Statements”).     Moreover, K&E attorneys advised the Debtors regarding drafting the

Schedules and Statements, attended regular conferences with the Debtors and their advisors

regarding the same.



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              (l)     Creditor and Stakeholder Communications [Matter No. 15]

              Total Fees:  $32,215.50
              Total Hours: 32.30

       46.    This    Matter    Category    includes    time   spent   by   K&E      attorneys   and

paraprofessionals on matters relating to stakeholder issues and communications. Specifically,

K&E attorneys and paraprofessionals spent time:

                      (i)      drafting and revising communication materials regarding the
                               Debtors’ chapter 11 cases;

                      (ii)     corresponding with the Debtors, various stakeholders, and their
                               respective advisors to provide updates as to developments in the
                               chapter 11 cases;

                      (iii)    providing relevant information and access to the Debtors and their
                               records as requested;

                      (iv)     responding to miscellaneous creditor inquiries; and

                      (v)      coordinating with the Debtors’ other professionals regarding
                               potential updates to the creditor matrix.

              (m)     U.S. Trustee Matters and Communications [Matter No. 16]

                      Total Fees:  $38,906.50
                      Total Hours: 31.90
       47.    This    Matter    Category    includes    time   spent   by   K&E      attorneys   and

paraprofessionals corresponding with the U.S. Trustee with respect to the following issues:

                      (i)      analyzing, researching, negotiating, and revising first day motions
                               and proposed orders regarding the U.S. Trustee’s comments, and
                               corresponding with the U.S. Trustee regarding the same; and

                      (ii)     coordinating with Cole Schotz to prepare the Debtors for and
                               participating in the initial debtor interview and the meeting of
                               creditors required by section 341 of the Bankruptcy Code.

              (n)     Hearings [Matter No. 17]

                      Total Fees:  $39,653.00
                      Total Hours: 28.00
       48.    This    Matter    Category    includes    time   spent   by   K&E      attorneys   and


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paraprofessionals providing services related to preparing for and attending several hearings

during the Fee Period (each a “Hearing” and, collectively, the “Hearings”), including preparing

agendas, orders, and binders related to Hearings, settling orders before and after Hearings, and

corresponding with various parties in preparation for, and after the Hearings. These services also

included conferences to discuss multiple matters scheduled for a specific Hearing and

coordinating Hearing logistics. During the Fee Period, K&E attorneys and paraprofessionals

spent considerable time preparing for and attending Hearings including:

                      (i)      the “first day” hearing on June 11, 2024 for interim or final
                               approval of the First Day Motions and interim approval of a
                               motion authorizing the Debtors to operate their cash management
                               systems and the DIP Facility; and

                      (ii)     hearings on August 26, 2024 and August 30, 2024 to approve the
                               proposed sale of the Debtors’ assets.

               (o)    Insurance and Surety Matters [Matter No. 18]

                      Total Fees:  $5,713.00
                      Total Hours: 5.40
       49.     This   Matter    Category   includes    time   spent   by   K&E    attorneys   and

paraprofessionals providing services related to ensuring that Debtors’ insurance policies were

maintained during these chapter 11 cases. Specifically, K&E attorneys and paraprofessionals

spent time drafting, negotiating, and revising the insurance order, reviewing and analyzing the

Debtors’ insurance policies and surety bond program, engaging with counsel to the sureties, and

researching and analyzing issues regarding the same.

               (p)    Utilities [Matter No. 19]

                      Total Fees:  $18,139.50
                      Total Hours: 17.10
       50.     This   Matter    Category   includes    time   spent   by   K&E    attorneys   and

paraprofessionals providing services related to utility issues arising in connection with filing



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these chapter 11 cases, including revising the utilities order and corresponding with AlixPartners,

LLP (“AlixPartners”) regarding issues related to the Debtors’ utilities.

               (q)     Tax Matters [Matter No. 20]

                       Total Fees:  $946,173.00
                       Total Hours: 645.70
       51.     This   Matter    Category    includes    time   spent   by   K&E     attorneys   and

paraprofessionals conducting legal research, preparing correspondence and pleadings, and

generally advising the Debtors on tax issues related to or arising during the chapter 11 cases.

During the Fee Period, K&E attorneys were responsible for researching and analyzing certain tax

issues arising in connection with the Debtors’ business operations, including the following:

                       (i)     advising the Debtors regarding the Debtors’ motion to establish
                               procedures related to certain transfers of, or declarations of
                               worthlessness with respect thereto, the Debtors’ common stock and
                               the interim and final orders approving the same;

                       (ii)    researching and analyzing certain tax issues related to the proposed
                               sale transactions, the implementation of the Plan, and emergence
                               from chapter 11;

                       (iii)   researching and analyzing certain tax issues and implications
                               arising in connection with the Debtors’ business operations,
                               business structure, intercompany transactions, recapitalizations, the
                               sale transactions, and the wind-down; and

                       (iv)    coordinating and communicating with the Debtors, the Debtors’
                               advisors, and relevant stakeholders regarding the foregoing.




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               (r)     Case Administration [Matter No. 21]

                       Total Fees:  $327,834.00
                       Total Hours: 327.10

       52.     This Matter Category includes time spent on a variety of tasks that were necessary

to ensure the efficient and smooth administration of legal services related to the Debtors’

chapter 11 cases. Specifically, K&E attorneys and paraprofessionals spent time:

               (i)     coordinating, managing, and administering the Debtors’ chapter 11 cases
                       on a daily basis, including monitoring critical dates and maintaining a case
                       calendar, task lists, and work-in-process reports;

               (ii)    organizing and maintaining voluminous document files for the Debtors’
                       chapter 11 cases;

               (iii)   ensuring compliance with the service and notice requirements of the
                       Bankruptcy Code, the Bankruptcy Rules, and the Local Rules, including
                       coordinating service of pleadings and other related notices with the
                       Debtors’ local counsel, Cole Schotz;

               (iv)    in connection with numerous pleadings, preparing notices of motions,
                       proposed orders, exhibits, schedules, and coordinating the delivery of such
                       pleadings to the Court and the U.S. Trustee; and

               (v)     conducting regular internal conferences regarding the overall case status to
                       ensure the efficient progress of workstreams.

       53.     Time billed to this Matter Category also includes work and meetings related to

multiple matters such that the time cannot be easily allocated to one of the other matters.

               (s)     K&E Fee Applications [Matter No. 22]

                       Total Fees:  $314,096.00
                       Total Hours: 332.90

       54.     This    Matter    Category   includes    time   spent   by   K&E     attorneys   and

paraprofessionals providing services related to the retention of K&E as the Debtors’ counsel.

Specifically, K&E attorneys and paraprofessionals spent time:

                       (i)      preparing pleadings and a comprehensive conflict analysis
                                necessary to obtain the order of the Court approving the
                                employment of K&E to represent the Debtors;


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                      (ii)     implementing internally established procedures which require the
                               continuous analysis of potential new conflicts;

                      (iii)    preparing updated professional disclosures for filing with the
                               Court;

                      (iv)     preparing and distributing K&E’s monthly fee statements in
                               accordance with the Interim Compensation Order;

                      (v)      reviewing all time entries to ensure compliance with the Interim
                               Compensation Order and applicable provisions of the Bankruptcy
                               Code, and to make necessary redactions to preserve the
                               confidentiality of the work performed for the Debtors; and

                      (vi)     conducting discussions, phone calls, and correspondence with the
                               U.S. Trustee regarding K&E’s retention and responding to
                               questions and comments regarding the same.

               (t)    Non-K&E Fee / Employment Applications [Matter No. 23]

                      Total Fees:  $152,778.50
                      Total Hours: 142.80
        55.    This   Matter    Category    includes    time   spent   by   K&E    attorneys   and

paraprofessionals providing services related to ensuring the retention of the Debtors’ other

professionals in these chapter 11 cases. Specifically, K&E attorneys and paraprofessionals spent

time:

                      (i)      coordinating and preparing the filing of section 156 application for
                               the Debtors’ claims and noticing agent and administrative advisor
                               Omni;

                      (ii)     coordinating with the Debtors and their other advisors with respect
                               to ordinary course professional retentions and complying with the
                               related disclosure requirements of applicable provisions of the
                               Bankruptcy Code;

                      (iii)    coordinating with the Debtors and Cole Schotz with respect to
                               ordinary course professional retentions and complying with the
                               related disclosure requirements of applicable provisions of the
                               Bankruptcy Code;

                      (iv)     reviewing retention applications filed by the Committee’s
                               professionals and coordinating with the Committee to address the



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                               Debtors’ concerns regarding these retentions and reviewing related
                               fee statements; and

                       (v)     coordinating efforts among the Debtors and their other
                               professionals to address various concerns and issues raised by the
                               U.S. Trustee and the Committee with respect to the retention of the
                               Debtors’ other professionals and ensuring that these professionals
                               were ultimately retained without any objection to assist in the
                               Debtors’ chapter 11 cases.

               (u)     Vendor Matters [Matter No. 24]

                       Total Fees:  $60,255.00
                       Total Hours: 54.80

       56.     This   Matter    Category    includes    time   spent   by   K&E     attorneys   and

paraprofessionals advising the Debtors on vendor and supplier issues, including with respect to

first day relief and postpetition business activities.         Specifically, K&E attorneys and

paraprofessionals spent time corresponding with Debtors’ advisors and vendors’ counsel

regarding prepetition vendor agreements, responding to inquiries from vendors concerning the

Debtors’ chapter 11 cases, and coordinating with AlixPartners regarding the same.

               (v)     Litigation [Matter No. 25]

                       Total Fees:  $256,302.50
                       Total Hours: 237.50

       57.     This   Matter    Category    includes    time   spent   by   K&E     attorneys   and

paraprofessionals providing services related to discovery, litigation, or other adversarial matters.

Specifically, K&E attorneys and paraprofessionals spent time:

                       (i)     reviewing, analyzing, researching, and preparing responses to
                               potential and actual filed objections; and

                       (ii)    reviewing, analyzing, and responding to various discovery requests
                               and reviewing potentially discoverable documents for privilege
                               and confidentiality considerations.

               (w)     Non-Working Travel Time [Matter No. 27]

                       Total Fees:    $46,201.50


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                       Total Hours: 33.30
       58.     This   Matter      Category   includes    time   spent   by   K&E   attorneys   and

paraprofessionals providing services related to traveling in connection with their representation

of the Debtors. The amounts presented for review and the request for payment in the Fee

Application reflect a reduction of one half the charges for travel time.

               (x)     Creditors’ Committee Issues [Matter No. 28]

                       Total Fees:  $118,611.00
                       Total Hours: 104.60

       59.     This Matter Category includes time spent by K&E attorneys meeting and

corresponding with the Committee’s advisors and the Debtors’ prepetition lenders and their

advisors to provide updates as to developments in the cases, providing relevant information and

access to the Debtors and their records as requested, and responding to miscellaneous creditor

inquiries.   K&E attorneys and paraprofessionals also spent time responding to information

requests from the Committee and coordinating with the Debtors’ other advisors to efficiently

respond to diligence requests.

               (y)     Employee and Labor Matters [Matter No. 29]

                       Total Fees:  $115,569.00
                       Total Hours: 76.90

       60.     This   Matter      Category   includes    time   spent   by   K&E   attorneys   and

paraprofessionals addressing the following employee compensation issues:

                       (i)       drafting, revising, and negotiating the proposed order approving,
                                 among other things, payment and continuation of employee
                                 compensation and benefits programs, and securing approval of the
                                 same on a final basis; and

                       (ii)      researching and analyzing issues concerning employment and
                                 labor matters.




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                      Actual and Necessary Expenses Incurred by K&E

       61.     As set forth in Exhibit I attached hereto, and as summarized in Exhibit G

attached hereto, K&E has incurred a total of $65,000.23 in expenses on behalf of the Debtors

during the Fee Period. These charges are intended to reimburse K&E’s direct operating costs,

which are not incorporated into the K&E hourly billing rates. K&E charges external copying

and computer research at the provider’s cost without markup. Only clients who actually use

services of the types set forth in Exhibit I of this Fee Application are separately charged for such

services. The effect of including such expenses as part of the hourly billing rates would impose

that cost upon clients who do not require extensive photocopying and other facilities and

services.

                    Reasonable and Necessary Services Provided by K&E

A.     Reasonable and Necessary Fees Incurred in Providing Services to the Debtors.

       62.     The foregoing professional services provided by K&E on behalf of the Debtors

during the Fee Period were reasonable, necessary, and appropriate to the administration of these

chapter 11 cases and related matters.

       63.     Many of the services performed by partners and associates of K&E were provided

by K&E’s Restructuring Group. K&E has a prominent practice in this area and enjoys a national

and international reputation for its expertise in financial reorganizations and restructurings of

troubled companies, with over 175 attorneys focusing on this area of the law. The attorneys at

K&E have represented either the debtor or the creditors’ committee or have acted as special

counsel in many large chapter 11 cases.

       64.     In addition, due to the facts and circumstances of these chapter 11 cases, attorneys

from K&E’s litigation, corporate, and tax groups were heavily involved with K&E’s

representation of the Debtors. These practice groups also enjoy a national and international


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reputation for their expertise. Overall, K&E brings to these chapter 11 cases a particularly high

level of skill and knowledge, which inured to the benefit of the Debtors and all stakeholders.

B.     Reasonable and Necessary Expenses Incurred in Providing Services to the Debtors.

       65.     The time constraints imposed by the circumstances of these chapter 11 cases

required K&E attorneys and other employees to devote substantial time during the evenings and

on weekends to perform services on behalf of the Debtors. These services were essential to meet

deadlines, respond to daily inquiries from various creditors and other parties in interest on a

timely basis, and satisfy the demands of the Debtors’ businesses and ensure the orderly

administration of their estates. Consistent with firm policy, and as further disclosed in the

Retention Application, K&E attorneys and other K&E employees who worked late in the

evenings or on weekends were reimbursed for their reasonable meal and transportation costs.

K&E’s regular practice is not to include components for those charges in overhead when

establishing billing rates, but rather to charge its clients for these and all other out-of-pocket

disbursements incurred during the regular course of the rendition of legal services.

       66.     In addition, due to the location of the Debtors’ businesses, co-counsel, creditors,

and other parties in interest in relation to K&E’s offices, frequent multi-party telephone

conferences involving numerous parties were required. On many occasions, the exigencies and

circumstances of these chapter 11 cases required overnight delivery of documents and other

materials. The disbursements for such services are not included in K&E’s overhead for the

purpose of setting billing rates and K&E has made every effort to minimize its disbursements in

these chapter 11 cases. The actual expenses incurred in providing professional services were

necessary, reasonable, and justified under the circumstances to serve the needs of the Debtors in

these chapter 11 cases.




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       67.    Among other things, K&E makes sure that all overtime meals, travel meals, hotel

rates, and airfares are reasonable and appropriate expenses for which to seek reimbursement.

Specifically, K&E regularly reviews its bills to ensure that the Debtors are only billed for

services that were actual and necessary and, where appropriate, prorates expenses. In that

regard, K&E will waive certain fees and reduce its expenses if necessary. In the Fee Period,

K&E voluntarily reduced its fees and expenses by $255,017.39. Consequently, K&E does not

seek payment of such fees or reimbursement of such expenses in the Fee Application.

         K&E’s Requested Compensation and Reimbursement Should be Allowed

       68.    Section 330 of the Bankruptcy Code provides that a court may award a

professional employed under section 327 of the Bankruptcy Code “reasonable compensation for

actual necessary services rendered . . . and reimbursement for actual, necessary expenses.”

11 U.S.C. § 330(a)(1).         Section 330 also sets forth the criteria for the award of such

compensation and reimbursement:

              In determining the amount of reasonable compensation to be awarded . . .
              the court shall consider the nature, the extent, and the value of such
              services, taking into account all relevant factors, including—

                         (A)      the time spent on such services;
                         (B)      the rates charged for such services;
                         (C)      whether the services were necessary to the
                                  administration of, or beneficial at the time at which
                                  the service was rendered toward the completion of,
                                  a case under this title;
                         (D)      whether the services were performed within a
                                  reasonable amount of time commensurate with the
                                  complexity, importance, and nature of the problem,
                                  issue, or task addressed;
                         (E)      with respect to a professional person, whether the
                                  person is board certified or otherwise has
                                  demonstrated skill and expertise in the bankruptcy
                                  field; and



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                         (F)   whether the compensation is reasonable based on
                               the customary compensation charged by
                               comparably skilled practitioners in cases other than
                               cases under this title.
11 U.S.C. § 330(a)(3).

        69.    K&E respectfully submits that the services for which it seeks compensation in this

Fee Application were, at the time rendered, necessary for and beneficial to the Debtors and their

estates and were rendered to protect and preserve the Debtors’ estates. K&E further believes that

it performed the services for the Debtors economically, effectively, and efficiently, and the

results obtained benefited not only the Debtors, but also the Debtors’ estates and the Debtors’

constituents. K&E further submits that the compensation requested herein is reasonable in light

of the nature, extent, and value of such services to the Debtors, their estates, and all parties in

interest.

        70.    During the Fee Period, K&E’s hourly billing rates for attorneys ranged from $745

to $2,465. The hourly rates and corresponding rate structure utilized by K&E in these chapter 11

cases are equivalent to the hourly rates and corresponding rate structure used by K&E for

restructuring, workout, bankruptcy, insolvency, and comparable matters, and similar complex

corporate, securities, and litigation matters, whether in court or otherwise, regardless of whether

a fee application is required. K&E strives to be efficient in the staffing of matters. These rates

and the rate structure reflect that such matters are typically national in scope and involve great

complexity, high stakes, and severe time pressures—all of which were present in these

chapter 11 cases.

        71.    Moreover, K&E’s hourly rates are set at a level designed to compensate K&E

fairly for the work of its attorneys and paraprofessionals and to cover certain fixed and routine

overhead expenses. Hourly rates vary with the experience and seniority of the individuals



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assigned. These hourly rates are subject to periodic adjustments to reflect economic and other

conditions and are consistent with the rates charged elsewhere.

       72.      In sum, K&E respectfully submits that the professional services provided by K&E

on behalf of the Debtors and their estates during these chapter 11 cases were necessary and

appropriate given the complexity of these chapter 11 cases, the time expended by K&E, the

nature and extent of K&E’s services provided, the value of K&E’s services, and the cost of

comparable services outside of bankruptcy, all of which are relevant factors set forth in

section 330 of the Bankruptcy Code. Accordingly, K&E respectfully submits that approval of

the compensation sought herein is warranted and should be approved.

       73.      No previous application for the relief sought herein has been made to this or any

other Court.

                               Reservation of Rights and Notice

       74.      It is possible that some professional time expended, or expenses incurred, during

the Fee Period are not reflected in the Fee Application. K&E reserves the right to include such

amounts in future fee applications. In addition, the Debtors have provided notice of this Fee

Application to: (a) the U.S. Trustee; (b) the Committee; (c) the office of the attorney general for

each of the states in which the Debtors operate; (d) the United States Attorney’s Office for the

District of Delaware; (e) the Internal Revenue Service; (f) the United States Securities and

Exchange Commission; (g) counsel to the 1L Ad Hoc Group; (h) the agent of the DIP Facility

and counsel thereto; (i) the agent of the First Lien Credit Agreement and counsel thereto; (j) the

Second Lien Credit Agreement Agent and counsel thereto; (k) the agent of the First Lien Notes

and counsel thereto; and (l) any party that has requested notice pursuant to Bankruptcy Rule

2002 (collectively, the “Notice Parties”). Pursuant to the Interim Compensation Order, any

party, other than the Notice Parties, that wishes to object to the Fee Application, must file its


                                                30
               Case 24-11217-BLS       Doc 742        Filed 11/13/24   Page 41 of 42




objection with the Court, with a copy to Chambers and serve it on the affected professional and

the Notice Parties so that it is actually received on or before December 4, 2024 (or the date

which is 21 days after service of this Application, whichever is later) at 4:00 p.m. prevailing

Eastern Time.

                                          No Prior Request

       75.      No prior application for the relief requested herein has been made to this or any

other court.

                                 [Remainder of Page Intentionally Blank]




                                                 31
                   Case 24-11217-BLS           Doc 742   Filed 11/13/24      Page 42 of 42




             WHEREFORE, K&E respectfully requests that the Court enter an order (a) awarding

      K&E interim compensation for professional and paraprofessional services provided during the

      Fee Period in the amount of $9,309,620.32, and reimbursement of actual, reasonable and

      necessary expenses incurred in the Fee Period in the amount of $65,000.23; (b) authorizing and

      directing the Debtors to remit payment to K&E for such fees and expenses; and (c) granting such

      other relief as is appropriate under the circumstances.

Dated: November 13, 2024
Wilmington, Delaware

 /s/ Patrick J. Reilley
  COLE SCHOTZ P.C.                                        KIRKLAND & ELLIS LLP
  Patrick J. Reilley, Esq. (DE Bar No. 4451)              KIRKLAND & ELLIS INTERNATIONAL LLP
  500 Delaware Avenue, Suite 1410                         Joshua A. Sussberg, P.C. (admitted pro hac vice)
  Wilmington, Delaware 19801                              601 Lexington Ave
  Telephone:       (302) 652-3131                         New York, New York 10022
  Facsimile:       (302) 652-3117                         Telephone:    (212) 446-4800
  Email:           preilley@coleschotz.com                Facsimile:    (212) 446-4900
                                                          Email:        joshua.sussberg@kirkland.com

 - and -                                                  - and -

 Michael D. Sirota, Esq. (admitted pro hac vice)          Spencer A. Winters, P.C. (admitted pro hac vice)
 Warren A. Usatine, Esq (admitted pro hac vice)           Yusuf U. Salloum (admitted pro hac vice)
 Court Plaza North, 25 Main Street                        333 West Wolf Point Plaza
 Hackensack, New Jersey 07601                             Chicago, Illinois 60654
 Telephone:     (201) 489-3000                            Telephone:      (312) 862-2000
 Facsimile:     (201) 489-1536                            Facsimile:      (312) 862-2200
 Email:         msirota@coleschotz.com                    Email:          spencer.winters@kirkland.com
                wusatine@coleschotz.com                                   yusuf.salloum@kirkland.com


 Proposed Co-Counsel to the Debtors                      Proposed Co-Counsel to the Debtors
 and Debtors in Possession                               and Debtors in Possession


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