Case Doc 18 Filed 04/04/17 Entered 04/04/17 22:09:08 Main Document Pg 1 of 7

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1 Pg 1 of 7 UNITED STATES BANKRUPTCY COURT EASTERN DISTRICT OF MISSOURI EASTERN DIVISION ) In re: ) Case No (659) ) CHAPTER 11 PAYLESS HOLDINGS LLC, et al., 1 ) ) (Joint Administration Requested) ) Debtors. ) Hearing Date: April 5, 2017 ) Hearing Time: 1:30 P.M. ) Hearing Location: Courtroom 7 North DEBTORS MOTION FOR LEAVE TO EXCEED THE PAGE LIMITATION IN THEIR FIRST DAY MOTIONS The above captioned debtors and debtors in possession (collectively, the Debtors ) respectfully state as follows in support of this motion (this Motion ): Relief Requested 1. By this Motion, and pursuant to Rule 9004(C) of the Local Rules of Bankruptcy Procedure for the Eastern District of Missouri (the Local Bankruptcy Rules ), the Debtors seek entry of an Order (the Proposed Order ) 2 authorizing the Debtors to exceed the page limitation 1 2 The Debtors (as defined herein) in these chapter 11 cases, along with the last four digits of each Debtor s federal tax identification number, are: Payless Holdings LLC [5704]; Payless Intermediate Holdings LLC [N/A]; WBG PSS Holdings LLC [N/A]; Payless Inc. [3160]; Payless Finance, Inc. [2101]; Collective Brands Services, Inc. [7266]; PSS Delaware Company 4, Inc. [1466]; Shoe Sourcing, Inc. [4075]; Payless ShoeSource, Inc. [4097]; Eastborough, Inc. [2803]; Payless Purchasing Services, Inc. [3043]; Payless ShoeSource Merchandising, Inc. [0946]; Payless Gold Value CO, Inc. [3581]; Payless ShoeSource Distribution, Inc. [0944]; Payless ShoeSource Worldwide, Inc. [6884]; Payless NYC, Inc. [4126]; Payless ShoeSource of Puerto Rico, Inc. [9017]; Payless Collective GP, LLC [N/A]; Collective Licensing, LP [1256]; Collective Licensing International LLC [5451]; Clinch, LLC [9836]; Collective Brands Franchising Services, LLC [3636]; Payless International Franchising, LLC [6448]; Collective Brands Logistics, Limited [6466]; Dynamic Assets Limited [1978]; PSS Canada, Inc. [4969]; Payless ShoeSource Canada Inc. [4180]; Payless ShoeSource Canada GP Inc. [4182]; and Payless ShoeSource Canada LP [4179]. The location of Debtor Payless Holdings LLC s corporate headquarters and the Debtors service address is: c/o Payless ShoeSource, Inc., 3231 SE 6th Avenue, Topeka, KS 66607, United States. A copy of the Proposed Order will be provided to the Notice Parties (as defined below) and made available on the Debtors case information website at 1

2 Pg 2 of 7 on certain of the first day motions (collectively, the First Day Motions ) filed by the Debtors contemporaneously herewith. Jurisdiction and Venue 2. The United States Bankruptcy Court for the Eastern District of Missouri (the Court ) has jurisdiction over this matter pursuant to 28 U.S.C. 157 and 1334 and Rule (B)(1) of the Local Rules of the United States District Court for the Eastern District of Missouri. This is a core proceeding pursuant to 28 U.S.C. 157(b). The Debtors confirm their consent, pursuant to Rule 7008 of the Federal Rules of Bankruptcy Procedure (the Bankruptcy Rules ), to the entry of a final order by the Court in connection with this Motion 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. 3. Venue is proper pursuant to 28 U.S.C and Background 4. The Debtors and their non-debtor affiliates (together, the Company ) comprise the largest specialty family footwear retailer in the Western Hemisphere, offering a wide range of shoes and accessory items at affordable prices. The Company has more than 4,000 stores in more than 30 countries. The Debtors are headquartered in Topeka, Kansas, but their operations are extensive and span across Asia, the Middle East, Latin America, Europe, and the United States. 5. On the date hereof (the Petition Date ), each of the Debtors filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code. The Debtors are operating their business and managing their properties as debtors in possession pursuant to sections 1107(a) and 1108 of title 11 of the United States Code (the Bankruptcy Code ). Concurrently with the filing 2

3 Pg 3 of 7 of this Motion, the Debtors filed a motion requesting procedural consolidation and joint administration of these chapter 11 cases pursuant to Bankruptcy Rule 1015(b). No request for the appointment of a trustee or examiner has been made in these chapter 11 cases and no committees have been appointed or designated. 6. A comprehensive description of the Debtors business and operations, capital structure, and the events leading to the commencement of these chapter 11 cases can be found in the Declaration of Michael Schwindle in Support of Debtors Chapter 11 Proceedings and First Day Pleadings (the First Day Declaration ), which was filed contemporaneously herewith and is incorporated herein by reference. Basis for Relief 7. Local Bankruptcy Rule 9004(C) requires that [w]ithout leave of Court, no motion, memorandum or brief shall exceed 15 pages exclusive of the signature page, certificate of service and attachments. The following First Day Motions exceed the page limitation imposed by Local Bankruptcy Rule 9004(C) due to the complexity and size of the Debtors chapter 11 cases: (a) (b) (c) (I) Authorizing the Debtors to (A) Continue Using the Cash Management System and (B) Maintain Existing Bank Accounts and Business Forms and Books and Records; (II) Authorizing Continued Intercompany Transactions; (III) Granting Administrative Expense Status to Postpetition Intercompany Payments; and (IV) Granting Related Relief; Debtors Motion for Entry of an Order (I) Authorizing the Debtors to (A) Prepare a List of Creditors in Lieu of Submitting a Formatted Mailing Matrix and (B) File a Consolidated List of the Debtors 50 Largest Unsecured Creditors, (II) Authorizing the Debtors to Redact Certain Personal Identification Information for Individual Creditors, (III) Approving the Manner of Notifying Creditors of Commencement of These Chapter 11 Cases, and (IV) Granting Related Relief; (A) Authorizing the Debtors to Pay Certain Prepetition Claims of 3

4 Pg 4 of 7 (I) Critical Vendors and (II) Carrier, Warehousemen, and Section 503(b)(9) Claimants and (B) Granting Related Relief; (d) (e) (I) Authorizing the Debtors to (A) Honor Certain Prepetition Obligations to Customers and Partners Programs and (B) Continue Certain Customer and Partner Programs in the Ordinary Course of Business and (II) Granting Related Relief; Debtors Motion for Entry of Interim and Final Orders (I) Authorizing the Debtors to Obtain Postpetition Financing, (II) Authorizing the Debtors to Use Cash Collateral, (III) Granting Liens and Providing Superpriority Administrative Expense Status, (IV) Granting Adequate Protection to the Prepetition Lenders, (V) Modifying the Automatic Stay, (VI) Scheduling a Final Hearing, and (VII) Granting Related Relief; (f) Declaration of Michael Schwindle in Support of Debtors Chapter 11 Proceedings and First Day Pleadings; (g) (h) (i) (j) (k) (l) (I) Authorizing the Debtors to (A) Continue Insurance Coverage Entered into Prepetition and Satisfy Prepetition Obligations Related Thereto and (B) Renew, Supplement, or Purchase Insurance Policies, and (II) Granting Related Relief; Debtors Motion for Entry of Interim and Final Orders (I) Authorizing the Debtors to Assume the Consulting Agreement, (II) Approving Procedures for Store Closing Sales, and (III) Granting Related Relief; (I) Approving Notification and Hearing Procedures for Certain Transfers of and Declarations of Worthlessness with Respect to Common Stock and (II) Granting Related Relief; Debtors Application for an Order (I) Authorizing the Appointment of Prime Clerk LLC as Notice and Claims Agent Nunc Pro Tunc to the Petition Date and (II) Granting Related Relief; Application of the Debtors and Debtors in Possession, Pursuant to Sections 327(a) and 329(a) of the Bankruptcy Code, Bankruptcy Rules 2014(A) and 2016(B) and Local Bankruptcy Rules 2014(A) and , for an Order Authorizing the Debtors and Debtors in Possession to Retain and Employ Armstrong Teasdale LLP as Local Restructuring Counsel, Effective as of the Petition Date; (I) Authorizing the Payment of Certain Prepetition Taxes and Fees and (II) Granting Related Relief; 4

5 Pg 5 of 7 (m) (n) (o) (p) (I) Prohibiting Utility Providers from Altering, Refusing, or Discontinuing Utility Services, (II) Determining Adequate Assurance of Payment for Future Utility Services, (III) Establishing Procedures for Determining Adequate Assurance of Payment, and (IV) Granting Related Relief; (I) Authorizing the Debtors to (A) Pay Prepetition Wages, Salaries, Other Compensation, and Reimbursable Expenses and (B) Continue Employee Benefits Programs, and (II) Granting Related Relief; 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 Nunc Pro Tunc to the Petition Date; and Debtors Motion Seeking Entry of an Order (I) Establishing Certain Notice, Case Management, and Administrative Procedures, and (II) Granting Related Relief. 8. The Debtors believe that additional pages are necessary to adequately and fully provide the Court with all of the necessary facts and supporting legal arguments in these First Day Motions. 9. Courts in this district have routinely granted motions to file pleadings in excess of page limits specified by the local rules where, as here, the issues addressed are significant and complex. See, e.g., In re Total Hockey, Inc., No (CER) (Bankr. E.D. Mo. July 8, 2016) (order granting leave to exceed the page limitation with respect to the debtors first day motions); In re Peabody Energy Corp., No (BSS) (Bankr. E.D. Mo. Apr. 13, 2016) (order granting debtors request to waive page limitation in Local Bankruptcy Rule 9004(C)); In re Noranda Aluminum, Inc., No (BSS) (Bankr. E.D. Mo. Feb. 12, 2016) (same) In re Arch Coal, Inc., No (CER) (Bankr. E.D. Mo. Jan. 21, 2016) (same); In re 5

6 Pg 6 of 7 Patriot Coal Corp., No (KSS) (Bankr. E.D. Mo. Apr. 18, 2013) (order granting Official Committee of Unsecured Creditors motion for leave to exceed the page limitation). 3 Notice 10. The Debtors will provide notice of this Motion to: (a) the Office of the United States Trustee for the Eastern District of Missouri; (b) the holders of the 50 largest unsecured claims against the Debtors (on a consolidated basis); (c) counsel to the Prepetition ABL Agent; (d) counsel to certain Prepetition ABL Lenders; (e) counsel to the Prepetition First Lien Term Loan Agent and the DIP Term Loan Agent; (f) counsel to the Prepetition First Lien Term Loan Steering Committee; (g) counsel to the Prepetition Second Lien Term Loan Agent; (h) the DIP ABL Agent; (i) co-counsel to the DIP ABL Agent, Choate, Hall & Stewart LLP (Attn: Kevin J. Simard, Esq. and Douglas R. Gooding, Esq.) and Thompson Coburn LLP (Attn. Mark V. Bossi, Esq.); (j) the Tranche A-1 Agent; (k) counsel to the Tranche A-1 Agent, Schulte, Roth & Zabel, LLP (Attn: Adam C. Harris, Esq.); (l) the United States Attorney s Office for the Eastern District of Missouri; (m) the Internal Revenue Service; (n) the United States Securities and Exchange Commission; (o) the state attorneys general for all states in which the Debtors conduct business; and (p) any party that has requested notice pursuant to Bankruptcy Rule 2002 (collectively, the Notice Parties ). The Debtors submit that, in light of the nature of the relief requested, no other or further notice need be given. No Prior Request 11. No prior request for the relief sought in this Motion has been made to this or any other Court in connection with these chapter 11 cases. 3 Because of the voluminous nature of the orders cited herein, such orders have not been attached to this Motion. Copies of these orders are available upon request to the Debtors proposed counsel. 6

7 Pg 7 of 7 WHEREFORE, the Debtors respectfully request entry of the Proposed Order (a) granting the relief requested herein, and (b) granting such other relief as is just and proper. Dated: April 4, 2017 /s/ Steven N. Cousins St. Louis, Missouri Steven N. Cousins MO Erin M. Edelman MO Armstrong Teasdale LLP 7700 Forsyth Boulevard, Suite 1800 St. Louis, MO Telephone: (314) Facsimile: (314) scousins@armstrongteasdale.com eedelman@armstrongteasdale.com Nicole L. Greenblatt, P.C. (pro hac vice pending) Cristine F. Pirro (pro hac vice pending) Jessica Kuppersmith (pro hac vice pending) Kirkland & Ellis LLP Kirkland & Ellis International LLP 601 Lexington Avenue New York, NY Telephone: (212) Facsimile: (212) nicole.greenblatt@kirkland.com cristine.pirro@kirkland.com jessica.kuppersmith@kirkland.com James H.M. Sprayregen, P.C. William A. Guerrieri (pro hac vice pending) Kirkland & Ellis LLP Kirkland & Ellis International LLP 300 North LaSalle Street Chicago, Illinois Telephone: (312) Facsimile: (312) will.guerrieri@kirkland.com Proposed Counsel for Debtors and Debtors in Possession 7