Case No. 00-19258-LBRUnited States Bankruptcy Court, D. Nevada.
September 16, 2002
Attorneys for NATIONAL AIRLINES, INC., Craig D. Hansen, Esq., Thomas J. Salerno, Esq., SQUIRE, SANDERS DEMPSEY L.L.P., Phoenix, Arizona
Local Counsel for NATIONAL AIRLINES, INC., James Shea, Esq., SHEA CARLYON, LTD, Las Vegas, Nevada
Special Counsel for NATIONAL AIRLINES, INC., Laurence M. Frazen, Esq., BRYAN CAVE, LLP, Kansas City, Missouri
ORDER APPROVING AND AUTHORIZING THE DEBTOR TO EXECUTE THE COMMITMENT LETTER TO PROVIDE EXIT FINANCING WITH FOOTHILL CAPITAL CORPORATION, INCLUDING APPROVAL OF BREAK-UP FEE AND EXPENSE DEPOSIT PROVISIONS
LINDA B. RIEGLE, United States Bankruptcy Judge
THIS MATTER having come before the Court upon the Motion dated September 11, 2002 (the “Motion”) of National Airlines, Inc., debtor and debtor in possession in the above-captioned Chapter 11 case (the “Debtor”), seeking the entry of an order approving the execution of that certain Commitment Letter (the “Commitment Letter”) between the Debtor and Foothill Capital Corporation (“Foothill”), regarding the provision of an exit financing facility (the “Exit Facility”) to the Debtor in the event that the Debtor successfully confirms a plan of reorganization in this Chapter 11 case. Based upon the Motion and the representations of counsel on the record at the hearing held in this matter,
THE COURT HEREBY FINDS AND CONCLUDES THAT:
(a) this Court has jurisdiction over the Motion under 28 U.S.C. § 157
and 1334;
(b) venue of this matter is proper in this district pursuant to 28 U.S.C. § 1408 and 1409;
(c) the Motion constitutes a core proceeding in which the Court can enter final orders under 28 U.S.C. § 157(h)(2);
(d) notice of the Motion was proper and adequate given the need for expedited review of the relief requested in the Motion, and no additional notice of the Motion, or the relief requested therein, is appropriate under the circumstances;
(e) any objections to the relief requested in the Motion have either been withdrawn or overruled by the Court;
(f) absent the Court granting the relief requested in the Motion, the Debtor and its estate will suffer immediate and irreparable harm;
(g) the requested Break-Up Fee and Expense Deposit (as defined below) are reasonable and necessary to encourage Foothill to incur the inherent risks and costs connected with the provision of the Exit Facility to the Debtor, and their approval is necessary and in the best interests of the Debtor, its estate and creditors; and
(h) good cause has been shown to grant the relief requested in the Motion.
NOW, THEREFORE, IT IS ORDERED THAT:
1. The Motion is approved.
2. The Debtor is authorized and empowered to execute the Commitment Letter with Foothill and to take any steps necessary to execute the Commitment Letter.
3. The Debtor is hereby authorized and approved to pay Foothill $100,000 to be used as an expense deposit (the “Expense Deposit”) to secure the payment of any costs and expenses incurred by Foothill in connection with the Exit Facility transaction, and Foothill is authorized to apply funds available in the Expense Deposit to costs and expenses it incurs in connection with the Exit Facility transaction as such are incurred. The Debtor is further authorized and approved to make, execute, and deliver all instruments and documents which may be requisite or necessary for the performance by the Debtor under the Commitment Letter without the necessity of the Debtor or Foothill filing any further application with the Court. In the event that Foothill decides not to make the Exit Facility available to the Debtor, any unused portion of the Expense Deposit will be returned to the Debtor.
4. The terms of the Commitment Letter providing for a $200,000 break-up fee (the “Break-Up Fee”), payable to Foothill in the event that the Debtor decides to obtain Exit Facility from an entity other than Foothill is approved as being reasonable and necessary and in the best interests of the Debtor, its estate and creditors.