Case No. 02 B 49672 (Jointly Administered)United States Bankruptcy Court, N.D. Illinois, Eastern Division
December 20, 2002
INTERIM ORDER: (I) AUTHORIZING DEBTORS IN POSSESSION TO ENTER INTO POST-PETITION CREDIT AGREEMENT PURSUANT TO SECTION 364 OF THE BANKRUPTCY CODE, (II) AUTHORIZING USE OF CASH COLLATERAL PURSUANT TO SECTION 363 OF THE BANKRUPTCY CODE, (III) GRANTING ADEQUATE PROTECTION PURSUANT TO SECTIONS 363 AND 364 OF THE BANKRUPTCY CODE, (IV) SCHEDULING FINAL HEARING PURSUANT TO FED. R. BANKR. P. 4001(c), AND (V) APPROVING NOTICE WITH RESPECT THERETO
CAROL A. DOYLE, United States Bankruptcy Judge
Upon the motion, dated December 19, 2002 (the “Motion”), of Conseco Finance Corp., as debtor in the above-referenced cases (“CFC”) and its subsidiaries (collectively, the “CFC Debtors” and, together with the other debtors in the above-captioned chapter 11 cases, the “Debtors”): (a) for the entry of Orders authorizing them to (i) obtain post-petition financing pursuant to sections 363 and 364 of title 11 of the United States Code (the “Bankruptcy Code”) by entering into that certain Secured SuperPriority Debtor in Possession Revolving Credit Agreement, dated as of December 19, 2002, as the same may be amended, supplemented or otherwise modified from time to time (the “Post-Petition Credit Agreement”),[2] with the lenders from time to time parties thereto (collectively, the “Post-Petition Lenders”), and FPS DIP LLC, as Administrative Agent (the “Post-Petition Agent”), subject to the terms and conditions set forth herein and therein, (ii) grant mortgages, security interests, liens and superpriority claims to the Post-Petition Agent acting on behalf of, and for the benefit of the Post-Petition Lenders (including, as specifically set forth herein and in the Post-Petition Credit Agreement, an administrative priority pursuant to section 364(c)(1) of the Bankruptcy Code, liens pursuant to sections 364(c)(2) and (3) of the Bankruptcy Code and priming liens pursuant to section 364(d) of the Bankruptcy Code), (iii) provide adequate protection to Wilmington Trust Company (the “Indenture Trustee”), under the Indentures, as defined below, and (iv) pending a final hearing on the Motion (the “Final Hearing”) (x) to obtain emergency postpetition loans under the Post-Petition Credit Agreement to and including the date on which the Final Order is entered (the “Interim Facility”), and (y) in accordance with Rule 4001(c)(2) of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”), requesting that this Court schedule the Final Hearing and approve notice with respect thereto; and based upon the evidence presented by the CFC Debtors, and the Court having considered the Motion and the Exhibits attached thereto; and in accordance with Bankruptcy Rule 4001(c)(1) and (c)(3), due and proper notice of the Motion having been given, and a hearing to consider approval of the Interim Facility having been held and concluded on the date hereof (the “Interim Hearing”); and upon all of the pleadings filed with the Court and all of the proceedings held before the Court; and after due deliberation and consideration and good and sufficient cause appearing therefor,
THE PARTIES HERETO STIPULATE:
A. Pursuant to that certain Credit Agreement, dated as of December 27, 2000, between CFC, as Borrower, and U.S. Bank National Association (“U.S. Bank” and, collectively with the Post-Petition Lenders, the “Lenders”) (as amended, supplemented or otherwise modified from time to time, the “Pre-Petition Credit Agreement” and together with all agreements, documents, notes, instruments and any other agreements delivered pursuant thereto or in connection therewith, the “Pre-Petition Financing Documents”), CFC received loans and advances and/or provided other financial accommodations to, inter alia, Fund its operations (the “Loans”). CIHC, Incorporated (the “Parent Guarantor”), one of the Debtors, jointly and severally unconditionally guaranteed the obligations under the Pre-Petition Credit Agreement (the “Parent Guaranty”). Conseco, Inc., parent of CFC and the Guarantor, also a Debtor herein, subordinated any right of repayment of any amounts owed to it by the Guarantor to the repayment obligations of the Guarantor under the Guaranty.
B. The Debtors admit that, as of the Petition Date, approximately $60,000,000 was outstanding in respect of the Loans made pursuant to the Pre-Petition Credit Agreement, plus interest thereon and fees and expenses incurred in connection therewith as provided in the Pre-Petition Financing Documents. For purposes of this Order, each of the terms “Post-Petition Indebtedness” and “Pre-Petition Indebtedness,” as hereinafter defined, shall include the principal of, and, to the extent payable and allowable hereunder or under the Bankruptcy Code, all interest, fees and other charges owing in respect of, such loans or indebtedness (including, without limitation, any reasonable attorneys’, accountants’, financial advisors’ and other fees and expenses that are chargeable or reimbursable under the relevant agreements relating to such loans or other indebtedness).
C. CFC further admits that it is a party to those certain indentures, dated as of February 18, 1993 and December 15, 1994, pursuant to which CFC’s 8-8.125% Senior Notes due 2003 and 10 1/2% Senior Notes due 2004, respectively, (of which approximately $89,000,000 in principal amount remains outstanding) were issued (the “Notes” together with the Loans, the “Pro-Petition Indebtedness”) to investors (the “Noteholders”).
D. To secure the Pre-Petition Indebtedness and cash management obligations owed to U.S. Bank, the CFC Debtors: (a) pledged to U.S. Bank and the Indenture Trustee the capital stock of (i) Mill Creek Bank, Inc. pursuant to that certain Pledge Agreement dated as of December 27, 2000 between Conseco and U.S. Bank (the “Mill Creek Pledge”) and (ii) Green Tree Retail Services Bank, Inc. and Rice Park Properties Corporation pursuant to that certain CFSC Pledge Agreement dated as of December 27, 2000 (as amended) (the “CFSC Pledge”); and (b) granted to U.S. Bank, mortgages in the Mortgaged Property and security interests in the proceeds, products, rents and profits of all of the foregoing (all of the foregoing collateral generally described above, together with all of the proceeds, products, rents and profits thereof shall be referred to herein collectively as the “Pre-Petition Collateral” and such liens shall be referred to herein as the “Pre-Petition liens”).
E. The Debtors acknowledge and agree and waive and release any right that the Debtors may have to challenge: (a) the Pre-Petition Liens; (b) that the Pre-Petition Liens constitute valid, binding, enforceable and perfected first priority liens subject only to liens described in or otherwise permitted by the Pre-Petition Credit Agreement, and are not subject to avoidance or subordination (except insofar as such liens are subordinated to the Post-Petition Liens, the Adequate Protection Liens and the Carveout (each as hereinafter defined) in accordance with the provisions of this Order) pursuant to the Bankruptcy Code or applicable non-bankruptcy law; (c) that the Pre-Petition Indebtedness constitutes legal, valid and binding obligations of the Debtors, enforceable in accordance with its terms (other than in respect of the stay of enforcement arising from section 362 of the Bankruptcy Code); (d) that the Debtors have no offsets, defenses or counterclaims to the Pre-Petition Indebtedness; (e) no portion of the Pre-Petition Liens or the Pre-Petition Indebtedness is subject to avoidance or subordination pursuant to the Bankruptcy Code or applicable non-bankruptcy law; and (f) that, as of the Petition Date, the claim of the Pre-Petition Lenders is an allowed secured claim within the meaning of section 506 of the Bankruptcy Code in an amount that is not less than $60,000,000.
F. An immediate and critical need exists for the CFC Debtors to obtain funds in order to continue the operation of their businesses. Without such funds, the CFC Debtors will not be able to fund the continued operation of the Debtors’ businesses and to repay the Pre-Petition Indebtedness in a manner that will avoid irreparable harm to the CFC Debtors’ estates. At this time, the ability of the CRC Debtors to finance their operations and the availability to them of sufficient working capital and liquidity through the incurrenec of new indebtedness and other financial accommodations are vital to the confidence of the CFC Debtors’ vendors and suppliers of other goods and services, to their customers and employees and to the preservation and maintenance of the going concern value of the CFC Debtors’ estates. The CFC Debtors are unable to obtain the required funds in the form of unsecured credit or unsecured debt allowable under section 503(b)(1) of the Bankruptcy Code as an administrative expense pursuant to section 364(a) or (b) of the Bankruptcy Code, unsecured debt having the priority afforded by section 364(c)(1) or debt secured only as described in section 364(c)(2) or (3).
G. The CFC Debtors (other than CFC, which is primarily liable as borrower) and CIHC are jointly and severally unconditionally guaranteeing the Post-Petition Indebtedness and all other obligations as set forth under the Post-Petition Financing Documents.
H. Subject to the applicable provisions of the Post-Petition Financing Documents and the terms of this Order, the Loans shall be deemed remitted to the applicable Lenders and applied to the payment of all outstanding indebtedness under the Pre-Petition Credit Agreement and re-advanced by the Lenders as “Designated Post-Petition Loans” on the same day deemed remitted in an amount not to exceed $60,000,000 plus any accrued interest fees, costs and charges. Any and all payments or proceeds remitted, or deemed to be remitted, pursuant to this Order (or any similar provision of the Post-Petition Financing Documents) shall be received, or deemed received, by the Post-Petition Agent for the benefit of the relevant Lenders free and clear of any claim, charge, assessment or other liability, including, without limitation, any such claim or charge arising out of or based on, directly or indirectly, sections 506(c) (whether asserted or assessed by, through or on behalf of the Debtors) or 552(b) of the Bankruptcy Code, all of which are hereby waived by the Debtors, other than the obligation to readvance funds in accordance with the provisions herein. Notwithstanding the provisions of this paragraph 2, the CHIC guaranty of the post-petition Obligations shall he granted and shall be treated as a general unsecured claim in the Parent Guarantor’s chapter 11 case.
I. Upon the consummation of a sale of assets or stock approved and authorized by an order of this Court, all net proceeds derived therefrom shall be paid directly by the purchaser thereof to the Post-Petition Agent for application in accordance with the provisions of the Post-Petition Financing Documents.
J. Except for the purposes set forth in the first sentence of Paragraph 12, none of the Lenders, the Post-Petition Agent, or the Indenture Trustee have consented or agreed to the use of the proceeds of the Post-Petition Indebtedness, the Pre-Petition Collateral or the Post-Petition Collateral.
K. Interest on the Loans and other Post-Petition Indebtedness shall accrue at the rates (including any default rates, if applicable) and shall he paid in accordance with and at the times as provided in the Post-Petition Financing Documents.
THE COURT HEREBY FINDS THAT:
L. On December 17, 2002 (the “Petition Date”), each of the Debtors filed with this Court 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 pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. No request has been made for the appointment of a trustee or examiner, and no official committee has yet been appointed in the Debtors’ chapter 11 cases.
M. This Court has jurisdiction over this matter pursuant to 28 U.S.C. § 157 and 1334. This is a core proceeding pursuant to 28 U.S.C. § 157(b)(2). The statutory predicates for the relief sought herein are sections 105, 361, 362, 363 and 364 of the Bankruptcy Code and Bankruptcy Rules 4001(b) and (c). Venue of the Debtors’ chapter 11 cases and this Motion in this district is proper pursuant to 28 U.S.C. § 1408 and 1409.
N. The Indenture Trustee has been given notice of the priming of the Mill Creek Pledge and the CSFC Pledge (collectively, the “Primed Collateral”) pursuant to this Order and the other Post-Petition Financing Documents (as hereinafter defined).
O. U.S. Bank consents and agrees to the CFC Debtors’ entering into the financing arrangements contemplated by this Order and the Post-Petition Financing Documents, and the Post-Petition Agent and Post-Petition Lenders are willing to provide the financing contemplated herein, all subject to the terms and conditions set forth herein, in the Post-Petition Credit Agreement and in the other Post-Petition Financing Documents and the provisions of this Order assuring that the Post-Petition Liens, the Adequate Protection Liens (each as hereinafter defined) and the various claims, superpriority claims and other protections granted pursuant to this Order, the Post-Petition Credit Agreement and the other Post-Petition Financing Documents will not be affected by any subsequent reversal or modification or appeal of this Order or any other order, as provided in section 364(e) of the Bankruptcy Code, which is applicable to the post-petition financing arrangements contemplated by this Order. The Post-Petition Agent and each of the Lenders have acted in good faith and at arm’s-length in consenting to and/or in agreeing to provide the financing contemplated by this Order, the Post-Petition Credit Agreement and the other Post-Petition Financing Documents and the reliance of the Post-Petition Agent and each of the Lenders on the assurances referred to above is in good faith.
P. Pursuant to the Bankruptcy Code and in light of the foregoing, the CFC Debtors are required to provide adequate protection to the Indenture Trustee in respect of their granting of the priming Post-Petition Lien on the Primed Collateral.
Q. Notice of the Interim Hearing on the Motion and this Order has been provided (by hand, fax, overnight mail or courier) to: (i) the Pre-Petition Agent; (ii) counsel to the U.S. Bank; (iii) the Post-Petition Agent; (iv) counsel to the Post-Petition Lenders; (v) the United States Trustee, (vi) the holders of the twenty (20) largest unsecured claims against the CFC Debtors; (vii) known holders of liens in and on the Post-Petition Collateral; and (viii) the Indenture Trustee. In view of the urgency of the relief requested, such notice constitutes sufficient notice under Bankruptcy Rule 4001 and no other notice need be given.
R. Good and sufficient cause has been shown for the entry of this Order. Among other things, entry of this Order will minimize disruption of the CFC Debtors’ businesses and operations pending the Final Hearing. The financing and adequate protection arrangements authorized hereunder are vital to avoid immediate and irreparable harm to the Debtors’ estates. Consummation of such financing arrangements therefore are in the best interests of the Debtors’ estates.
S. The financing and adequate protection arrangements authorized hereunder have been negotiated in good faith and at arm’s length among the CFC Debtors, CIHC, the Post-Petition Agent, and each of the Lenders and the terms of such financing and adequate protection arrangements are fair and reasonable under the circumstances, reflect the CFC Debtors’ and CHIC’s exercise of prudent business judgment consistent with their fiduciary duties and are supported by reasonably equivalent value and fair consideration.
T. The Debtors have requested immediate entry of this Order pursuant to Bankruptcy Rule 4001(b)(2) and (c)(2). The permission granted herein to enter into the Post-Petition Financing Documents and obtain funds, incur indebtedness and other financial accommodations thereunder is necessary to avoid immediate and irreparable harm to the Debtors pending the Final Hearing. This Court concludes that entry of this Order is in the best interests of the Debtors and their estates and creditors as its implementation will, among other things, allow for the continued operation and rehabilitation of the Debtors’ existing businesses.
NOW, THEREFORE, IT HEREBY IS ORDERED, THAT:
1. The CFC Debtors and CIHC be, and hereby are, authorized to enter into the Post-Petition Credit Agreement (the Post-Petition Credit Agreement, together with all agreements, documents, notes and instruments delivered pursuant hereto or thereto or in connection herewith or therewith, including, the Budget, as defined below, and this Order are hereinafter collectively referred to as the “Post-Petition Financing Documents”) in substantially the form annexed to the Motion, and to borrow money, incur indebtedness and perform their obligations hereunder and thereunder in accordance with, and subject to, the terms of this Order and the other Post-Petition Financing Documents, including, without limitation, the applicable Budget. The CFC Debtors and CIHC are authorized to enter into such non-material and not adverse to the Debtors modifications and amendments to the Post-Petition Financing Documents, without further order of this Court, as may he agreed upon in writing by the CFC Debtors and CIHC, and the Post-Petition Agent (and, to the extent required by the Post-Petition Financing Documents, the Post-Petition Lenders), except for, other than in accordance with Section 13.1(a) of the Post-Petition Credit Agreement: (i) increase in the Commitments; (ii) any increase in the applicable interest rates on the Loans; (iii) any modification of the maturity of the Loans or the Designated Post-Petition Loan, as defined below; or (iv) any other modification which imposes any additional material burden on any Debtors. The Post-Petition Financing Documents constitute valid and binding obligations of the CFC Debtors and CIHC, enforceable against the CFC Debtors and CIHC in accordance with their respective terms; provided, however, that pending entry of the Final Order, the Debtors shall be permitted to borrow no more than $87,000,000 under the DIP Facility, with $27,000,000 of such amount being the maximum borrowing permitted under the revolver portion of the DIP Facility, subject to a $1,000,000 sublimit for loans to Conseco Finance Credit Corp. (“CFCC”), a non-Debtor wholly-owned subsidiary of CFC.
2. From and after the Petition Date through the Termination Date (as hereinafter defined), and subject to the terms and conditions of this Order and the Post-Petition Financing Documents, the CFC Debtors are authorized to borrow and reborrow funds, including all cash collateral (as defined in section 363(a) of the Bankruptcy Code) in their possession or control arising from, or constituting proceeds of, the Post-Petition Collateral (the “Cash Collateral”) and incur indebtedness pursuant to the terms and provisions of this Order, the Post-Petition Credit Agreement and the other Post-Petition Financing Documents. For purposes of this Order, “proceeds” of any collateral shall mean proceeds (as defined in the Uniform Commercial Code) of such collateral as well as; (x) any and all proceeds of any insurance, indemnity or warranty or guaranty payable to the CFC Debtors from time to time with respect to any of such collateral; (y) any and all payments (in any form whatsoever) made or due and payable to the CFC Debtors in connection with any requisition, confiscation, condemnation, seizure or forfeiture of all or any part of such collateral by any governmental body, authority, bureau or agency (or any person under color of governmental authority); and (z) any other payments, dividends, interest or other distributions on or in respect of any of such collateral.
3. Except as expressly set forth herein, payments in respect of the Notes and the Adequate Protection Obligations shall be subordinated to the indefeasible payment in full in cash of the Post-Petition Indebtedness in accordance with the Post-Petition Financing Documents. Without limiting the generality of the foregoing, and except as expressly set forth herein, unless and until all outstanding Post-Petition Indebtedness is indefeasibly paid in full in cash, all other amounts due and owing under the Post-Petition Financing Documents are indefeasibly paid in full in cash and the Post-Petition Credit Agreement and all commitments thereunder are terminated, under no circumstances shall any holder of the Notes, or Adequate Protection Obligations have, with respect thereto, any enforcement rights against, or with respect to, the Primed Collateral or Post-Petition Collateral or any other rights or remedies that may interfere with or otherwise restrict the rights and remedies of the Post-Petition Agent or the Post-Petition Lenders hereunder, under the other Post-Petition Financing Documents or otherwise with respect to the Post-Petition Indebtedness, other than as set forth in paragraph 25 hereunder.
4. As security for all Loans, Obligations and any other indebtedness or obligations, contingent or absolute which may now or from time to time hereafter be owing by the CFC Debtors or CFCC to the Post-Petition Agent or the Post-Petition Lenders hereunder or under any of the other Post-Petition Financing Documents (all such Loans, Obligations and other indebtedness or obligations, together with the Designated Post-Petition Loans and any obligations at any time incurred by the CFC Debtors or CFCC on or after the Petition Date to the Post-Petition Agent or any of the Lenders in connection with the CFC Debtors’ cash management system, collectively, the “Post-Petition Indebtedness”), subject to the provisions contained herein, the Post-Petition Agent is hereby granted for the sole benefit of the Post-Petition Agent and the Post-Petition Lenders valid, binding, enforceable and perfected liens (the “Post-Petition Liens”) in all presently owned or hereafter acquired property and assets of the CFC Debtors of any kind or nature, whether real or personal, tangible or intangible, wherever located, now owned or hereafter acquired or arising and all proceeds, products, rents and profits thereof, including, without limitation, all cash (including all Cash Collateral, wherever held), goods, accounts receivable, inventory, cash-in-advance deposits, real estate, machinery, equipment, vehicles, trademarks, trade names, licenses, causes of action, rights to payment including tax refund claims, insurance proceeds and tort claims (excluding actions for preferences, fraudulent conveyances, and other avoidance power claims and any recoveries under sections 506(c), 542, 544, 545, 547, 548, 549, 550, 552(b) and 553 of the Bankruptcy Code) and the proceeds, products, rents and profits of all of the foregoing (all of the foregoing, the “Post-Petition Collateral”), (i) subject and subordinate only to the Carveout and, pursuant to section 364(c)(3) of the Bankruptcy Code, to any valid, binding, enforceable and perfected Liens (other than the Pre-Petition Liens) existing in the Post-Petition Collateral on the Petition Date or arising after the Petition Date pursuant to sections 362(b)(18) or 546 of the Bankruptcy Code or pursuant to the interim 9019 Order or Final 9019 Order as to the first, prior and senior lien of U.S. Bank as Trustee on the MH Platform (“Securitization Trustee’s MH Platform Lien”) as described therein or permitted by Sections 8.2(d) or (e) of the Post-Petition Credit Agreement (collectively, the “Senior Liens”); and (ii) senior and superior pursuant to section 364(d)(1) of the Bankruptcy Code to any Liens or claims encumbering the Primed Collateral, including, without limitation, the Pre-Petition Liens and the Adequate Protection Liens (but subject to the Carveout).
5. The Indenture Trustee’s lien on the Primed Collateral is adequately protected in accordance with sections 363(c) and 364(d) of the Bankruptcy Code because the collateral supporting the Debtors’ obligations to the indenture Trustee enjoys, in the aggregate, a substantial equity cushion, In addition, the Indenture Trustee is hereby granted for the sole benefit of the Indenture Trustee and the Noteholders valid, binding, enforceable and perfected liens (the “Adequate Protection Liens”) in all Post-Petition Collateral to secure an amount of Pre-Petition Indebtedness equal to the sum of, without duplication, the aggregate diminution, if any, subsequent to the Petition Date, in the value of the Mill Creek Pledge and the CSFC Pledge, resulting from the priming authorized hereunder, any loss in market value or otherwise (the “Adequate Protection Obligations”). The Adequate Protection Liens are: (a) subject and subordinate only to (i) the Post-Petition Liens, and (ii) the Carveout and any Senior Liens; and (b) senior and superior pursuant to section 364(d) of the Bankruptcy Code to the Pre-Petition Liens.
6. Except as expressly set forth in this Order or any of the Post-Petition Financing Documents, the liens granted in this Order shall not be: (a) subject to any lien which is avoided and preserved for the benefit of the CFC Debtors’ estates under section 551 of the Bankruptcy Code; or (b) subordinated to or made pari passu with any other lien under section 364(d) of the Bankruptcy Code or otherwise. As used in this Order, “Carveout” means: (i) the unpaid fees of the clerk of the Bankruptcy Court and of the United States Trustee pursuant to 28 U.S.C. § 1930(a) and (b); and (ii) the aggregate allowed unpaid fees and expenses payable under sections 330 and 331 of the Bankruptcy Code to professional persons retained pursuant to an order of the Court by the Debtors or any statutory committee appointed in these chapter 11 cases (other than the fees and expenses, if any, of any such professional persons incurred, directly or indirectly, in respect of, arising from or relating to, the initiation or prosecution of any action for preferences, fraudulent conveyances, other avoidance power claims or any other claims or causes of action against the Agents or the Lenders or with respect to the Post-Petition Indebtedness or the Pre-Petition Indebtedness; provided, however, that the Carveout may be used to investigate such claims and causes of action), not to exceed Five Hundred Thousand Dollars ($500,000.00) in the aggregate. So long as no Default or Event of Default shall have occurred and be continuing, the Debtors shall, subject to the times and amounts specified therefor in the Budget, be permitted to pay compensation and reimbursement of expenses allowed and payable under sections 330 and 331 of the Bankruptcy Code, as the same may be due and payable, and the same shall not reduce the Carveout; provided, however, that any retainers paid prior to the Petition Date and held by the professionals shall be fully applied against and utilized prior to such professional’s receiving any payments from the Carveout.
7. In addition, the Post-Petition Indebtedness shall have priority in all of the CFC Debtors’ chapter 11 cases in accordance with the provisions of section 364(c)(1) of the Bankruptcy Code over all administrative expenses of the kind specified in section 503(b) or 507(b) of the Bankruptcy Code (“Superpriority”), except as it relates to avoidance actions, subject and subordinate only to the Carveout. Except as expressly set forth herein, no costs or administrative expenses which have been or may be incurred in the CFC Debtors’ chapter 11 cases, in any conversion of the CFC Debtors’ chapter 11 cases pursuant to section 1112
of the Bankruptcy Code, or in any other proceeding related thereto, and no priority claims, including, without limitation, any other Superpriority claims, are or will be prior to or on a parity with the claims of the Post-Petition Agent, the Lenders, the Indenture Trustee or the Noteholders against the CFC Debtors arising, as applicable, out of the Post-Petition Loans, Adequate Protection Obligations or any provision of this Order or with the Liens granted herein and in the Post-Petition Financing Documents in and to the Post-Petition Collateral.
8. The Post-Petition Indebtedness shall become due and payable, without notice or demand, on the Termination Date, as provided herein and in the other Post-Petition Financing Documents and from and after the Termination Date, the CFC Debtors shall have no authority under this Order to use Cash Collateral.
9. The CFC Debtors may use the proceeds of the Post-Petition Indebtedness solely at the times and as provided in the Post-Petition Financing Documents this Order and as specifically set forth in the Budget.
10. From and after the Petition Date, the proceeds of the Post-Petition Indebtedness, and the Post-Petition Collateral shall not, directly or indirectly, be used to pay expenses of the Debtors or otherwise disbursed except as expressly permited in the Post-Petition Financing Documents.
11. The automatic stay under section 362(a) of the Bankruptcy Code shall be, and it hereby is, modified to the extent necessary to permit the Post-Petition Agent for the sole benefit of the Lenders to receive, collect and apply payments and proceeds in respect of the Pre-Petition Collateral and the Post-Petition Collateral in accordance with the terms and provisions of this Order, the Post-Petition Credit Agreement, and the other Post-Petition Financing Documents.
12. Notwithstanding anything herein or in the other Post-Petition Financing Documents to the contrary, the Debtors shall no longer, pursuant to this Order, the other Post-Petition Financing Documents or otherwise, be authorized to borrow Funds or incur indebtedness hereunder or under the other Post-Petition Financing Documents or to use any proceeds of the Post-Petition Indebtedness already received and any obligation of the Lenders to make loans or advances or under the other Post-Petition Financing Documents or hereunder shall be terminated upon the earliest to occur of any of the following events (any such event shall be referred to as a “Termination Event” and the date of any such event shall be referred to as the “Termination Date”):
(i) material non-compliance by any of the Debtors with any of the terms or provisions of this Order;
(ii) any Event of Default shall have occurred and be continuing, and any notice required pursuant to the Post-Petition Financing Documents to cause the Post-Petition Indebtedness to become due and payable shall have been given;
(iii) the consummation of any Plan of Reorganization; and
(iv) the earlier of(x) the termination for any reason of the Asset Purchase Agreement, (y) the Closing Date (as defined in the Asset Purchase Agreement) and (z) 90 days after the Petition Date (or, if the 9019 Order has been entered within 30 Business Days (APA Method) after the Petition Date, 120 days after the Petition Date) (the “Scheduled Termination Date”).
Notwithstanding the occurrence of the Termination Date or anything herein, all of the rights, remedies, benefits and protections provided to the Post-Petition Agent, Indenture Trustee, Noteholders and the Lenders under this Order shall survive the Termination Date. Upon the Termination Date, the principal of and all accrued and unpaid interest and fees and all other amounts owed to the Post-Petition Agent or the Lenders hereunder or under the other Post-Petition Financing Documents shall be immediately due and payable and the Post-Petition Agent and the Lenders shall have all other rights and remedies provided in the Post-Petition Financing Documents. Notwithstanding anything herein to the contrary, no Post-Petition Indebtedness or any proceeds of Post-Petition Collateral (collectively, “Lender Funds”) may be used by any of the Debtors, any statutory committee or any other person or entity to object to or contest in any manner, or raise any defenses or contests to, the validity, perfection, priority or enforceability of the Pre-Petition Indebtedness or the Pre-Petition Liens, or to assert or prosecute any action for preferences, fraudulent conveyances, other avoidance power claims or any other claims or causes of action against the Lenders (collectively, “Claims and Defenses”); without limiting the Foregoing: (i) at no time shall any such committee or other person or entity have the right to use Lender Funds to prosecute any such Claims and Defenses; (ii) any such committee or other person or entity shall have the right to assert Claims and Defenses only in an action commenced in this Court on or before the sixtieth (60th) day following such committee’s appointment; (iii) if no such action is commenced on or before such date, all Claims and Defenses shall be deemed, immediately and without further action by the Post-Petition Agent or the Lenders to have been forever relinquished and waived as to such committee and other person or entity with actual notice of this Chapter 11 case; and (iv) the terms of this Order pertaining to the granting of Liens and Superpriority claims for, and the repayment of, Pre-Petition Indebtedness shall be without prejudice to the right of any such committee or other person or entity to commence and prosecute Claims and Defenses solely as set forth in (ii) above; and, provided,further, that, as to the Debtors, all such Claims and Defenses are hereby relinquished and waived as of the Petition Date. In addition to the foregoing, no Lender Funds may be used by any of the Debtors, any statutory committee or any other entity to object to or contest in any manner the Post-Petition Indebtedness or the Post-Petition Liens or to assert or prosecute any actions, claims or causes of action against the Post-Petition Agent or any of the Post-Petition Lenders.
13. If it shall be necessary for the Post-Petition Agent or the Post-Petition Lenders, at any time, to exercise any of their respective rights and remedies hereunder, under the Post-Petition Financing Documents, or under applicable law in order to effect repayment of the Post-Petition Indebtedness, or to receive any amounts or remittances due hereunder, the Post-Petition Agent and the Lenders shall have the right without any further action or approval of this Court to exercise such rights and remedies available to them under applicable law as to all or such part of the Post-Petition Collateral as the Post-Petition Agent and the Lenders shall, in their sole discretion, elect; provided. however,
that none of the Post-Petition Agent or the Lenders, as applicable, shall exercise such rights or remedies without having provided the Debtors, the Office of the United States Trustee, Indenture Trustee, U.S. Bank, as trustee, and any unofficial official committee that may be appointed in these chapter 11 cases with at least four (4) business days’ advance written notice by fax, overnight delivery, or hand delivery. The Post Petition Agent and the Lenders shall be entitled to apply the payments or proceeds of the Pre-Petition Collateral and the Post-Petition Collateral in accordance with the provisions of this Order, and, in no event shall any of the Post Petition Agent or any of the Lenders be subject to the equitable doctrine of “marshaling” or any other similar doctrine with respect to any of the Pre-Petition Collateral or Post-Petition Collateral or otherwise.
14. Notwithstanding anything herein or in the Post-Petition Financing Documents to the contrary, the Post-Petition Lenders obligations under this Order shall only be effective so long as the Lehman Order remains in full force and effect, and neither Green Tree Finance Corp. nor Lehman (as defined in the Lehman Order) is in default of any funding obligation thereunder.
15. Except as provided in the Post-Petition Financing Documents, no order shall be entered at any time during their chapter 11 cases that grants liens in the Pre-Petition Collateral, the Post-Petition Collateral or any portion thereof to any other parties pursuant to section 364(d) of the Bankruptcy Code or otherwise, which liens are senior, on a parity with or junior to the liens of the Post-Petition Agent therein;provided, however, that an order may be entered granting a junior lien in the Post-Petition Collateral and the Senior Lien of the Securitization Trustee’s MH Platform Lien in connection with the Interim 9019 Order or the 9019 Order, provided that the grantee of such junior lien shall not have any right to object to sale any of the Post-Petition Collateral that may be permitted under the Post-Petition Credit Agreement, except as to any rights that such grantee U.S. Bank as Securitization Trustee and Certificateholders have under the relevant securitization documents, or as creditors or under the Securitization Trustee’s MH Platform Lien (all of which rights to object are reserved). Except on the terms of this Order and of the Post-Petition Financing Documents, the Debtors shall be enjoined and prohibited from at any time, until the post-petition Obligations have been or will be paid in full or will be as a result thereof, applying to the Bankruptcy Court, the District Court or any Judge of any United States District Court or Bankruptcy Court for an order authorizing the use of the post-petition Collateral. Notwithstanding anything to the contrary contained in this Order, nothing herein shall limit the Debtors’ ability to seek the granting of: (i) superpriority claims in accordance with section 364 of the Bankruptcy Code; and (ii) liens senior to those held by the Lenders pursuant to this Order or the Pre-Petition Financing Documents, both of(i) and (ii) in connection with and subject to the completion of a Court-approved refinancing and indefeasible payment in full in cash of the post-petition Obligations in connection with or in contemplation of the occurrence of the Termination Date; provided, however, that notwithstanding the foregoing, the Debtors shall not seek to refinance an amount less than the entire amount of the post-petition Obligations.
16. The Debtors shall execute and deliver to the Post-Petition Agent and the Lenders, all such agreements, financing statements, instruments and other documents as the Post-Petition Agent or any of the Lenders may reasonably request to evidence, confirm, validate or perfect the liens granted pursuant hereto.
17. Without limiting the rights of access and information afforded the Post-Petition Agent and the Lenders under the Post-Petition Financing Documents, the CFC Debtors shall permit representatives, agents and/or employees of the Post-Petition Agent or the Lenders to have reasonable access to their premises and their records during normal business hours (without unreasonable interference with the proper operation of the CFC Debtors’ businesses) and shall cooperate, consult with, and provide to such persons all such non-privileged information as they may reasonably request.
18. The CFC Debtors shall promptly: (a) reimburse the Post-Petition Agent and the Post-Petition Lenders for their reasonable costs and expenses provided for in Sections 13.3(a) and (b) of the Post-Petition Credit Agreement. None of such costs and expenses shall be subject to the approval of this Court, and no recipient of any such payment shall be required to file with respect thereto any interim or final fee application with this Court. All liens granted herein and in the other Post-Petition Financing Documents to secure repayment of the Post-Petition Indebtedness, and all liens granted herein to secure repayment of the Adequate Protection Obligations shall, pursuant to this Order be, and they hereby are, deemed perfected effective as of the Petition Date, and no further notice, filing or other act shall be required to effect such perfection; provided, however, that, if the Post-Petition Agent or the Indenture Trustee shall, in its sole discretion, choose to file such mortgages, financing statements, notices of liens and security interests and other similar documents, all such mortgages, financing statements or similar instruments shall be deemed to have been filed or recorded at the time and on the date of entry of this Order.
19. The provisions of this Order shall be binding upon and inure to the benefit of each of the Post-Petition Agent, each of the Lenders, tile Indenture Trustee, Noteholders and the Debtors, together with their respective successors and assigns (including any trustee or other fiduciary hereafter appointed as a legal representative of the Debtors or with respect to the property of the estates of the Debtors).
20. Based upon the findings set forth in this Order and in accordance with section 364(e) of the Bankruptcy Code, which is applicable to the post-petition financing arrangements contemplated by this Order, in the event any or all of the provisions of this Order or any other Post-Petition Financing Documents are hereafter modified, amended or vacated by a subsequent order of this or any other Court, no such modification, amendment or vacature shall affect the validity, enforceability or priority of any lien or claim authorized or created hereby or thereby. Notwithstanding any such modification, amendment or vacature, any claim granted to the Post-Petition Agent or to the Lenders hereunder or under the other Post-Petition Financing Documents arising prior to the effective date of such modification, amendment or vacation shall be governed in all respects by the original provisions of this Order and the other Post-Petition Financing Documents, and the Post-Petition Agent or the Lenders, as the case may be, shall be entitled to all of the rights, remedies, privileges and benefits, including the liens and priorities granted herein and therein, with respect to any such claim.
21. The Debtors are authorized to do and perform all acts, to make, execute and deliver all instruments and documents (including, without limitation, the execution of additional security agreements, mortgages and financing statements) and to pay fees and expenses which may be required or necessary for the CFC Debtors’ performance under the Post-Petition Financing Documents, including, without limitation: (i) the execution by the CFC Debtors of the Post-Petition Financing Documents; and (ii) the payment by the CFC Debtors of the fees and other expenses described in the Post-Petition Financing Documents as such become due and payable, including, without limitation, agents’ fees, commitment fees, and facility fees and reasonable attorneys’, financial advisers’, appraisers’ and accountants’ fees and disbursements as provided for in the Post-Petition Financing Documents.
22. The obligations of the Debtors in respect of the Post-Petition Obligations unless otherwise paid in full or provided as otherwise agreed upon, shall not be discharged by the entry of an order: (i) confirming a plan of reorganization in any of the Debtors’ chapter 11 cases and, pursuant to section 1141(d)(4) of the Bankruptcy Code, the Debtors having hereby waived such discharge; or (ii) dismissing any or all of the Debtors’ chapter 11 cases. Without limiting the foregoing, the Debtors shall not seek the entry of an order dismissing any of the Debtors’ chapter 11 cases under section 1112 of the Bankruptcy Code or otherwise shall be entered unless, prior to the entry thereof: (x) all Post-Petition Indebtedness owing to the Post-Petition Agent and the Post-Petition Lenders shall have been paid in full; or (y) all material assets of the Debtors shall have been liquidated and the proceeds thereof distributed in accordance with the priorities established by this Order and the Bankruptcy Code; or (z) agreed to in writing by the Post-Petition Agent.
23. Notwithstanding anything herein, the entry of this Order is without prejudice to, and does not constitute a waiver of, expressly or implicitly, or otherwise impair: (a) any of the rights of the Post-Petition Agent the Lenders, or the Indenture Trustee under the Bankruptcy Code or under non-bankruptcy law, including, without limitation, the right of the Post-Petition Agent, the Lenders or the Indenture Trustee to: (i) request additional adequate protection of their interests in the Post-Petition Collateral or relief from or modification of the automatic stay extant under section 362 of the Bankruptcy Code; (ii) request conversion of any of the CFC Debtors’ chapter 11 cases to cases under chapter 7 of the Bankruptcy Code; and (iii) propose, subject to the provisions of section 1121 of the Bankruptcy Code, a chapter 11 plan or plans; or (b) any of the rights, claims or privileges (whether legal, equitable or otherwise) of the Post-Petition Agent, the Lenders, or the Indenture Trustee.
24. The Final Hearing shall be held on January 14, 2003 at 11:00 a.m. (Central Standard Time), at 219 South Dearborn, Courtroom 742, Chicago, Illinois, and notice of the Final Hearing, which shall be provided as set forth in the Motion, constitutes sufficient notice under Bankruptcy Rule 4001 and no other notice need be given.
25. Based upon the record presented to the Court, this Order shall constitute findings of fact and conclusions of law and shall take effect immediately upon execution hereof.
26. To the extent of any inconsistency between the terms of this Order and the Post-Petition Credit Agreement, the terms and provisions of this Order shall govern.
27. To the extent not otherwise withdrawn or deemed to be moot, the Objections are hereby overruled to this grant of interim relief.
28. Nothing contained in this Order shall adversely affect, impair, waive, limit or alter the rights, claims and interest of U.S. Bank National Association as Trustee for certain Securitization Trusts under the Interim 9019 Order entered on December 18, 2002 or the Final 9019 Order solely with respect to the Securitization Trustee’s MH Platform Lien including, but not limited to that Adequate Protection Lien, rights and priorities set forth therein and related thereto, provided, however, that (for the avoidance of doubt) the Securitization Trustee’s MR Platform Lien does not relate to any of the Primed Collateral.