Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:1 of 57

Transcription

1 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:1 of 57 IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF GEORGIA AUGUSTA DIVISION In re: ) Chapter 11 ) FIBRANT, LLC, et al., 1 ) Case No (SDB) ) ) Debtors. ) Jointly Administered ) SECOND INTERIM APPLICATION FOR ALLOWANCE OF ATTORNEYS FEES AND REIMBURSEMENT OF EXPENSES INCURRED BY KING & SPALDING LLP, COUNSEL FOR DEBTORS, FOR THE PERIOD FROM AUGUST 1, 2018 THROUGH DECEMBER 31, 2018 King & Spalding LLP ( K&S ), counsel to Fibrant, LLC ( Fibrant ) and its affiliated debtors-in-possession (collectively, the Debtors ) in these chapter 11 cases, hereby submits this second interim application (the Application ) seeking allowance of compensation and reimbursement of expenses pursuant to Sections 330 and 331 of Title 11 of the United States Code (the Bankruptcy Code ) and Rule 2016(a) of the Federal Rules of Bankruptcy Procedure for the period from August 1, 2018 through December 31, 2018 (the Application Period ). K&S submits this Application for (a) allowance of reasonable compensation for professional services rendered by K&S to the Debtor, and (b) reimbursement of actual and necessary charges and disbursements incurred by K&S in the rendition of required professional services on behalf of the Debtors. In support of this Application, K&S respectfully represents as follows: 1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor s federal tax identification number, are: Fibrant, LLC (6694); Evergreen Nylon Recycling, LLC (7625); Fibrant South Center, LLC (8270); and Georgia Monomers Company, LLC (0042).

2 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:2 of 57 Jurisdiction 1. This Court has jurisdiction to consider this Application pursuant to 28 U.S.C Consideration of this Application is a core proceeding pursuant to 28 U.S.C. 157(b). Venue of this proceeding is proper before this Court pursuant to 28 U.S.C and Background 2. On February 23, 2018 (the Petition Date ), the Debtors filed voluntary petitions with the Court under chapter 11 of the Bankruptcy Code. 3. The factual background relating to the Debtors commencement of these chapter 11 cases is set forth in detail in the Declaration of David Leach in Support of First-Day Motions and Applications (the First-Day Declaration ), filed on the Petition Date and incorporated herein by reference. 4. The Debtors have continued in possession of their properties and continue to manage their business as debtors-in-possession pursuant to Sections 1107(a) and 1108 of the Bankruptcy Code. 5. An Official Committee of Unsecured Creditors (the Committee ) was appointed on March 16, As of the date of this filing, no request for the appointment of a trustee or examiner has been made. 6. This Application has been prepared in accordance with the United States Trustee Guidelines for Reviewing Applications for Compensation and Reimbursement of Expenses Filed Under 11 U.S.C. 330, adopted on June 11, 2013 (the UST Guidelines ). 7. K&S represents that the Debtors have received and reviewed this Application. The Debtors have found that this Application accurately represents the work done by K&S on their behalf and approve the request for compensation and reimbursement sought in this Application. 2

3 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:3 of As of December 31, 2018, the Debtors had approximately $6,635, in cash and temporary investments on hand or on deposit in their estates. See Debtors Standard Monthly Operating Report for the Period from December 1, 2018 through December 31, The Debtors have filed their monthly operating reports for all periods through December 31, 2018, and have paid all quarterly U.S. Trustee fees to date. 10. On October 19, 2018, the Court entered the Order On First Interim Application for Allowance of Attorneys Fees and Reimbursement of Expenses Incurred by King & Spalding LLP, Counsel for the Debtors, For the Period February 23, 2018 Through July 31, 2018 [Docket No. 416]. 11. The Debtors filed a Plan and Disclosure Statement on December 21, A hearing on the Debtors Disclosure Statement is scheduled for February 7, Retention of K&S 12. On February 28, 2018, the Debtors applied to the Court for an order approving the retention of K&S as their bankruptcy counsel (the Retention Application ) to perform legal services necessary to enable the Debtors to execute their financial restructuring through chapter 11. On March 5, 2018, the Court entered multiple orders [Docket Nos ] (collectively, the Retention Orders ) authorizing the Debtors to retain K&S as their counsel under the terms set forth in the Retention Application. Fee Procedures Order 13. On May 2, 2018, the Court entered the Order Establishing Procedures for Monthly Compensation and Reimbursement of Expenses of Professionals (the Fee Procedures Order ) pursuant to Sections 105(a) and 331 of the Bankruptcy Code. Pursuant to the Fee Procedures Order, all professionals (other than ordinary course professionals) retained in these cases are 3

4 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:4 of 57 authorized to seek interim compensation for professional services rendered and reimbursement for expenses incurred. Compensation Paid and Its Source 14. All services for which K&S seeks compensation were performed for or on behalf of the Debtors. 15. There is no agreement or understanding between K&S and any other person except for the partners of K&S for the sharing of compensation to be received for the services rendered in these cases. Requested Fees and Reimbursement of Disbursements 16. In connection with its efforts during the Application Period, K&S now seeks interim allowance of $952, in fees calculated at the hourly billing rates of the firm s personnel who have worked on these cases, and $ in charges and disbursements actually and necessarily incurred by K&S while providing services to the Debtors during the Application Period Pursuant to the terms of the Fee Procedures Order, K&S has submitted statements for services rendered during the Application Period and has received (or anticipates receiving) payments in respect of such statements totaling approximately $857,602.28, of which $856, has been (or will be) applied to fees and $ has been (or will be) applied to expenses. In connection with its efforts during the Application Period, K&S now seeks the additional payment of the ten percent (10%) fee holdback amount of approximately $95, (the Holdback ). 18. Prior to the Petition Date, K&S received a retainer from the Debtors in connection with this representation. A portion of such retainer was applied to K&S s pre-petition fees and 2 K&S s rates were adjusted as of January 1,

5 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:5 of 57 expenses associated with this representation and the balance of the retainer is currently $344, Exhibit A attached hereto sets forth the time spent and the work performed by each attorney and paraprofessional for the Application Period. To the best of K&S s knowledge, this Application complies with Sections 330 and 331 of the Bankruptcy Code, Bankruptcy Rule 2016, the UST Guidelines, and the Fee Procedures Order. 20. K&S s charges for its professional services are based upon the time, nature, extent and value of such services and the cost of comparable services in a case other than under the Bankruptcy Code. Actual and Necessary Expenses 21. A summary of actual and necessary expenses incurred by K&S for the Application Period is attached hereto as Exhibit B. 22. K&S customarily charges $0.10 per page for photocopying expenses. K&S uses an Equitrac device that automatically records the number of copies made. K&S summarizes each client s photocopying charges on a daily basis. 23. K&S charges the standard usage rates billed by providers of on-line legal research (e.g., LEXIS and Westlaw) for computerized legal research. Any volume discount received by K&S is passed on to its clients. 24. K&S charges its clients for the actual expenses related to travel, hotel lodging, and business meals. 25. K&S does not charge for local or long-distance telephone calls placed by attorneys from their offices. K&S does charge its clients for the actual costs charged to K&S for engaging teleconferencing services in the event that a multiple-party teleconference is initiated through K&S. 5

6 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:6 of K&S believes the foregoing rates are the market rates generally employed by the majority of law firms when charging their clients for such services. Professional Services Rendered 27. In accordance with the UST Guidelines, all K&S professionals kept a contemporaneous record of time spent rendering services and separated tasks in billing increments of one-tenth (0.10) of an hour. 28. Exhibit C attached to this Application is a summary of the legal services which K&S rendered to the Debtors during the Application Period. The services rendered by K&S during the Application Period can be grouped into the categories set forth in Exhibit C. K&S attempted to place the services performed in the category that best relates to the services provided. However, because certain services may relate to more than one category, services pertaining to one category may in fact be included in another category. The actual detailed daily time entries for all work performed by the attorneys and paraprofessionals who rendered services during the Application Period are attached as Exhibit D. Such time entries are organized by subject matter category as required by the UST Guidelines. 29. K&S has represented the Debtors with respect to various matters arising in the Debtors chapter 11 cases. Among other things, during the Application Period K&S has advised the Debtors with respect to their (a) the winding down (and eventual cessation) of business operations; (b) fulfillment of the various reporting obligations in connection with the cases, including the preparation of monthly operating reports; (c) negotiating and documenting a property transfer agreement with Environmental Liability Transfer, Inc. (which is incorporated into the Plan); (d) negotiating with environmental regulatory authorities and other parties-in-interest regarding environmental issues and liability; (e) analyzing and filing objections to claims; and (f) 6

7 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:7 of 57 negotiating and documenting the Debtors Plan and Disclosure Statement, which was filed with the Court on December 21, Valuation of Services 30. Attorneys and professionals of K&S expended a total of 1,167.6 hours in connection with these cases during the Application Period. The reasonable value of those services is $952, based on the hourly rates set forth on Exhibit A. 31. This is K&S s second request for an award of interim compensation in these cases. 32. In accordance with the factors enumerated in Section 330 of the Bankruptcy Code, it is respectfully submitted that the amount requested by K&S is fair and reasonable given (a) the nature of these cases; (b) the issues arising in connection with addressing the decommissioning of the Debtors assets and the environmental remediation of the Debtors plant site; (c) the time and labor required to represent the Debtors effectively; (d) the nature and extent of services rendered; (e) K&S s experience, reputation and ability; (f) the value of K&S s services; and (g) the cost of comparable services other than in a case under the Bankruptcy Code. 33. The compensation sought herein is based on the customary compensation charged by comparably skilled practitioners in cases other than cases under the Bankruptcy Code. 34. K&S has reviewed the requirements of the UST Guidelines and believes that this Application complies in all material respects with those requirements. To the extent this Application does not comply in every respect with the requirements of such guidelines, K&S respectfully requests a waiver for any such technical non-compliance. Compliance with Rule 2016 of Federal Rules of Bankruptcy Procedure 35. In accordance with Rule 2016 of the Federal Rules of Bankruptcy Procedure, K&S hereby states that (a) all services for which compensation is sought herein were rendered to the Debtors solely in connection with their chapter 11 cases and not on behalf of any committee, 7

8 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:8 of 57 individual creditor or other person; (b) to date on a post-petition basis K&S has received only those payments made to it by the Debtors pursuant to the Fee Procedures Order; (c) no agreement or understanding exists between K&S and any other person for the sharing of compensation to be received for services rendered in or in connection with these cases; and (d) no division of compensation will be made by K&S, except as between members of K&S, and no agreement prohibited by 18 U.S.C. 155 or Section 504 of the Bankruptcy Code has been made. REQUEST FOR RELIEF WHEREFORE, K&S respectfully requests that the Court enter an Order substantially in the form attached hereto as Exhibit E providing that (i) for the period from August 1, 2018 through December 31, 2018, an interim allowance be made to K&S in the sum of $952, as compensation for necessary and reasonable professional services rendered and the sum of $ for reimbursement of actual and necessary costs and expenses, (ii) K&S be authorized to apply against such amounts the amounts that have been and, subsequent to the date of this Application, will be paid to it by the Debtors in respect of the Application Period pursuant to the Fee Procedures Order, (iii) the Debtors be authorized and directed to pay the Holdback to K&S in respect of the Application Period, and (iv) for such other and further relief as this Court may deem just and proper. 8

9 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:9 of 57 Dated: February 1, 2019 Augusta, Georgia Respectfully submitted, KING & SPALDING LLP /s/ Paul K. Ferdinands Paul K. Ferdinands Georgia Bar No Jonathan W. Jordan Georgia Bar No Sarah L. Primrose Georgia Bar No Peachtree Street Atlanta, Georgia Telephone: (404) Facsimile: (404) and KLOSINSKI OVERSTREET, LLP James C. Overstreet Jr. Georgia Bar No Augusta West Parkway Augusta, GA Telephone: (706) Facsimile: (706) COUNSEL FOR THE DEBTORS-IN-POSSESSION 9

10 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:10 of 57

11 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:11 of 57

12 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:12 of 57

13 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:13 of 57

14 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:14 of 57

15 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:15 of 57

16 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:16 of 57

17 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:17 of 57

18 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:18 of 57

19 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:19 of 57

20 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:20 of 57

21 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:21 of 57

22 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:22 of 57

23 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:23 of 57

24 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:24 of 57

25 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:25 of 57

26 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:26 of 57

27 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:27 of 57

28 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:28 of 57

29 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:29 of 57

30 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:30 of 57

31 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:31 of 57

32 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:32 of 57

33 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:33 of 57

34 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:34 of 57

35 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:35 of 57

36 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:36 of 57

37 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:37 of 57

38 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:38 of 57

39 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:39 of 57

40 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:40 of 57

41 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:41 of 57

42 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:42 of 57

43 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:43 of 57

44 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:44 of 57

45 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:45 of 57

46 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:46 of 57

47 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:47 of 57

48 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:48 of 57

49 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:49 of 57

50 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:50 of 57

51 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:51 of 57

52 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:52 of 57

53 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:53 of 57

54 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:54 of 57 EXHIBIT E Proposed Order

55 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:55 of 57 IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF GEORGIA AUGUSTA DIVISION In re: ) Chapter 11 ) FIBRANT, LLC, et al., 3 ) Case No (SDB) ) ) Debtors. ) Jointly Administered ) ORDER ON SECOND INTERIM APPLICATION FOR ALLOWANCE OF ATTORNEYS FEES AND REIMBURSEMENT OF EXPENSES INCURRED BY KING & SPALDING LLP, COUNSEL FOR DEBTORS, FOR THE PERIOD AUGUST 1, 2018 THROUGH DECEMBER 31, 2018 Upon consideration of the Second Interim Application for Allowance of Attorneys Fees and Reimbursement of Expenses Incurred by King & Spalding LLP, Counsel for Debtors (the Application ), dated February 1, 2019, for (a) allowance of reasonable compensation for 3 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor s federal tax identification number, are: Fibrant, LLC (6694); Evergreen Nylon Recycling, LLC (7625); Fibrant South Center, LLC (8270); and Georgia Monomers Company, LLC (0042).

56 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:56 of 57 professional services rendered by King & Spalding LLP ( K&S ) to the Debtors for the period from August 1, 2018 through December 31, 2018 (the Application Period ), and (b) reimbursement of actual and necessary charges and disbursements incurred by K&S in the rendition of required professional services on behalf of the Debtors during the Application Period; and a hearing regarding the Application having been held on [ ]; and good and sufficient cause appearing therefore; and capitalized terms used in this Order being given the same meanings as are ascribed to those terms in the Application, it is hereby ORDERED as followed: 1. The Application [Docket No. ] is hereby granted in its entirety. 2. An interim allowance shall be made to K&S in the sum of $952, as compensation for necessary and reasonable professional services rendered during the Application Period and the sum of $ for reimbursement of actual and necessary costs and expenses incurred during the Application Period. 3. K&S is authorized to apply against such amounts the amounts that have been and, subsequent to the date of the Application, were paid to it by the Debtors in respect of the Application Period pursuant to the Fee Procedures Order. 4. The Debtors are authorized and directed to pay the Holdback amount to K&S in respect of the Application Period. END OF DOCUMENT 2

57 Case: SDB Doc#:578 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:57 of 57 Prepared and presented by: KING & SPALDING LLP /s/ Paul K. Ferdinands Paul K. Ferdinands Georgia Bar No Jonathan W. Jordan Georgia Bar No Sarah L. Primrose Georgia Bar No Peachtree Street Atlanta, Georgia Telephone: (404) Facsimile: (404) and KLOSINSKI OVERSTREET, LLP James C. Overstreet Jr. Georgia Bar No Augusta West Parkway Augusta, GA Telephone: (706) Facsimile: (706) COUNSEL FOR THE DEBTORS-IN-POSSESSION 3

58 Case: SDB Doc#:578-1 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:1 of 3 IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF GEORGIA AUGUSTA DIVISION In re: ) Chapter 11 ) FIBRANT, LLC, et al., 3 ) Case No (SDB) ) ) Debtors. ) Jointly Administered ) ORDER ON SECOND INTERIM APPLICATION FOR ALLOWANCE OF ATTORNEYS FEES AND REIMBURSEMENT OF EXPENSES INCURRED BY KING & SPALDING LLP, COUNSEL FOR DEBTORS, FOR THE PERIOD AUGUST 1, 2018 THROUGH DECEMBER 31, 2018 Upon consideration of the Second Interim Application for Allowance of Attorneys Fees and Reimbursement of Expenses Incurred by King & Spalding LLP, Counsel for Debtors (the Application ), dated February 1, 2019, for (a) allowance of reasonable compensation for 3 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor s federal tax identification number, are: Fibrant, LLC (6694); Evergreen Nylon Recycling, LLC (7625); Fibrant South Center, LLC (8270); and Georgia Monomers Company, LLC (0042).

59 Case: SDB Doc#:578-1 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:2 of 3 professional services rendered by King & Spalding LLP ( K&S ) to the Debtors for the period from August 1, 2018 through December 31, 2018 (the Application Period ), and (b) reimbursement of actual and necessary charges and disbursements incurred by K&S in the rendition of required professional services on behalf of the Debtors during the Application Period; and a hearing regarding the Application having been held on [ ]; and good and sufficient cause appearing therefore; and capitalized terms used in this Order being given the same meanings as are ascribed to those terms in the Application, it is hereby ORDERED as followed: 1. The Application [Docket No. ] is hereby granted in its entirety. 2. An interim allowance shall be made to K&S in the sum of $952, as compensation for necessary and reasonable professional services rendered during the Application Period and the sum of $ for reimbursement of actual and necessary costs and expenses incurred during the Application Period. 3. K&S is authorized to apply against such amounts the amounts that have been and, subsequent to the date of the Application, were paid to it by the Debtors in respect of the Application Period pursuant to the Fee Procedures Order. 4. The Debtors are authorized and directed to pay the Holdback amount to K&S in respect of the Application Period. END OF DOCUMENT 2

60 Case: SDB Doc#:578-1 Filed:02/01/19 Entered:02/01/19 16:09:24 Page:3 of 3 Prepared and presented by: KING & SPALDING LLP /s/ Paul K. Ferdinands Paul K. Ferdinands Georgia Bar No pferdinands@kslaw.com Jonathan W. Jordan Georgia Bar No jjordan@kslaw.com Sarah L. Primrose Georgia Bar No sprimrose@kslaw.com 1180 Peachtree Street Atlanta, Georgia Telephone: (404) Facsimile: (404) and KLOSINSKI OVERSTREET, LLP James C. Overstreet Jr. Georgia Bar No jco@klosinski.com 1229 Augusta West Parkway Augusta, GA Telephone: (706) Facsimile: (706) COUNSEL FOR THE DEBTORS-IN-POSSESSION 3