Case bjh11 Doc 568 Filed 02/25/19 Entered 02/25/19 09:00:11 Page 1 of 10

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Case 18-33967-bjh11 Doc 568 Filed 02/25/19 Entered 02/25/19 09:00:11 Page 1 of 10 The following constitutes the ruling of the court and has the force and effect therein described.

1 Case bjh11 Doc 568 Filed 02/25/19 Entered 02/25/19 09:00:11 Page 1 of 10 The following constitutes the ruling of the court and has the force and effect therein described. Signed February 22, 2019 United States Bankruptcy Judge IN THE UNITED STATES BANKRUPTCY COURT FOR THE NORTHERN DISTRICT OF TEXAS DALLAS DIVISION In re: Chapter 11 Senior Care Centers, LLC, et al., 1 Case No (BJH) Debtors. (Jointly Administered) AGREED ORDER GRANTING ADEQUATE PROTECTION AND CONDITIONAL RELIEF FROM THE AUTOMATIC STAY Upon the motion (the Motion ) of Wells Fargo Equipment Finance, Inc., Wells Fargo Bank N.A. dba Wells Fargo Equipment Finance, and Wells Fargo Financial Leasing, Inc. (collectively, WFEF ) for approval of this agreed order (this Order ) pursuant to Bankruptcy Rule 4001(d); The Court finds that the Motion was properly served pursuant to Federal and Local Rules of Bankruptcy Procedure and that it contained the appropriate fourteen (14) day negative notice language, pursuant to Bankruptcy Rule 4001(d)(2). The Court finds that any objections to 1 The Debtors in the Chapter 11 cases, along with the last four digits of each Debtor s federal tax identification number, are set forth in the Order (I) Directing Joint Administration of Chapter 11 Cases, and (II) Granting Related Relief [Docket No. 65] and may also be found on the Debtors claims agent s website at The location of the Debtors service address is 600 North Pearl Street, Suite 1100, Dallas, Texas 75201

2 Case bjh11 Doc 568 Filed 02/25/19 Entered 02/25/19 09:00:11 Page 2 of 10 the Motion have been withdrawn, resolved, or denied. Counsel for the Debtors and WFEF have announced that they have reached a final agreement with regard to adequate protection, the terms of which are reflected herein below. THE DEBTORS AND WFEF STIPULATE AS FOLLOWS, WHICH STIPULATIONS SHALL NOT BE BINDING ON ANY OTHER PARTIES IN INTEREST IN THESE CASES: 1. Certain Debtors are parties to leases with WFEF (or its predecessor in interest), as lessor, pursuant to which such Debtors leased equipment for use in their businesses, including the following active leases (collectively, the Lease Agreements ), with the remaining rental balance due indicated in parentheses (_). All Lease Agreements, save for b. Master Lease Agreement No. 603-XXX3253 listed below, have a $1 buy out option at end of term and thus, by agreement solely for the purposes of this Order, the agreed adequate protection payment is indicated by brackets [_]: a. Lease Agreement no. 301-XXX dated October 27, 2016 with Senior Care Centers, LLC, pursuant to which such Debtor leased 59 Auto Therm Diathermy 390 units with cart & coil and certain other equipment specified therein for at term of 36 months with a monthly lease payment of $22, [$5,879.99] ($293,999.29); b. Master Lease Agreement no. 603-XXX3253 dated September 1, 2016 with Senior Care Centers, LLC, and Master Lease Schedule thereto dated September 29, 2016, pursuant to which such Debtor leased 65 Xerox WorkCentre 7970 copier systems for a term of 48 months with a monthly rental payment of $69,982.21[$43, by agreement] ($2,044,435.08); c. Equipment Lease and Agreement of Sale no. XX dated as of July 13, 2015 with Senior Care Centers, LLC, pursuant to which such Debtor leased three (3) 2015 Ford pickup trucks, model F150 VIN (last six) D76546, D76547, and A29016 for a term of 48 months with a monthly rental payment of $2, [$374.53] ($18,726.48); d. Equipment Lease and Agreement of Sale no. XX dated as of March 30, 2016 with Senior Care Centers, LLC, pursuant to which such Debtor leased three (3) 2015 Ford F150 pickup trucks VINs (last six) 2

3 Case bjh11 Doc 568 Filed 02/25/19 Entered 02/25/19 09:00:11 Page 3 of 10 D76544, D76545, and E97828 for a term of 48 months with a monthly rental payment of $2, [$757.76] ($37,887.90); e. Single Sided Lease Agreement dated January 5, 2016 with Harden Pharmacy, LLC, pursuant to which such Debtor leased a Dosis L60 robot for a term of 60 months with a monthly lease payment of $2, [$1,196.93] ($59,846.73); f. Single Sided Lease Agreement dated April 25, 2016 with Jacksonville SCC LLC, pursuant to which such Debtor leased 10 Prime Care 902 beds and four (4) 301 beds for a term of 36 months with a monthly lease payment of $ [$250.00] ($2,910.84); g. Single Sided Lease Agreement dated June 22, 2015 with Meadow Creek SCC LLC, pursuant to which such Debtor leased 22 P902 electric beds for a term of 36 months with a monthly lease payment of $ [$250.00] ($1,037.28); h. Single Sided Lease Agreement dated June 27, 2016 with Mission SCC LLC, pursuant to which such Debtor leased 10 each rotating assist bars, gravity 7 mattresses and 35 Mill Crk hd/ft s for a term of 36 months with a monthly lease payment of $ [$250.00] ($3,694.26); i. Single Sided Lease Agreement dated November 8, 2016 with Mission SCC LLC, pursuant to which such Debtor leased 10 each rotating assist bars, gravity 8 mattresses and 35 Mill Crk hd/ft s for a term of 36 months with a monthly lease payment of $ [$250.00] ($5,884.80); j. Single Sided Lease Agreement dated November 10, 2016 with Park Bend SCC LLC, pursuant to which such Debtor leased 15 each rotating assist bars and 35 SM hollow hd/ft s for a term of 36 months with a monthly lease payment of $ [$250.00] ($8,469.02); k. Single Sided Lease Agreement dated November 8, 2016 with PM Management Killeen II NC, LLC, pursuant to which such Debtor leased five (5) Prime Care 301 beds with rotating assist bars and gravity 7 mattresses, and two (2) Prime Care 902 beds with rotating assist bars, width extension 39 42, Mill Crk hd/ft, and ShearCare 1500 mattresses for a term of 36 months with a monthly lease payment of $ [$250.00] ($3,578.39); l. Single Sided Lease Agreement dated June 22, 2015 with Rowlett SCC LLC, pursuant to which such Debtor leased 96 P902 electric beds for a term of 36 months with a monthly lease payment of $3, [$250.00] ($6,188.29); m. Single Sided Lease Agreement dated June 22, 2015 with San Angelo SCC LLC, pursuant to which such Debtor leased 22 P902 electric beds for a term 3

4 Case bjh11 Doc 568 Filed 02/25/19 Entered 02/25/19 09:00:11 Page 4 of 10 of 36 months with a monthly lease payment of $ [$250.00] ($1,037.26); n. Single Sided Lease Agreement dated September 22, 2016 with Shreveport SCC LLC, pursuant to which such Debtor leased 10 Prime Care 902 beds and Mill Crk bed ends for a term of 36 months with a monthly lease payment of $ [$375.93] ($4,552.05); o. Single Sided Lease Agreement dated August 15, 2016 with Westover Hills SCC LLC, pursuant to which such Debtor leased three (3) Prime Care 902 electric beds, four (4) Primeplus bariatric bed, and four (4) Shearcare mattresses for a term of 36 months with a monthly lease payment of $ [$250.00] ($6,045.95); p. Single Sided Lease Agreement dated June 27, 2016 with Wurzbach SCC LLC, pursuant to which such Debtor leased 10 each Prime Care 902 beds, rotating assist bars, gravity 7 mattresses, and 35 Mill Crk hd/ft s for a term of 36 months with a monthly lease payment of $ [$250.00] ($3,597.98); q. Equipment Lease and Agreement of Sale no. XX dated as of May 3, 2016 with Clear Brook LLC, pursuant to which such Debtor leased a 2016 Ford Starcraft Allstar shuttle bus VIN (last six) C22718 for a term of 48 months with a monthly rental payment of $1, [$489.44] ($24,472.00); r. Equipment Lease and Agreement of Sale no. XX dated as of January 27, 2015 with Crowley SCC LLC, pursuant to which such Debtor leased a 2014 Ford Starcraft Allstar shuttle bus VIN (last six) A72897 for a term of 48 months with a monthly rental payment of $1, [$250.00] ($3,663.00); s. Equipment Lease and Agreement of Sale no. XX dated as of May 3, 2016 with Hunters Pond SCC LLC, pursuant to which such Debtor leased a 2016 Ford Starcraft Allstar shuttle bus VIN (last six) C22732 for a term of 48 months with a monthly rental payment of $1, [$483.45] ($24,172.38); t. Equipment Lease and Agreement of Sale no. XX dated as of May 3, 2016 with Meadow Creek SCC LLC, pursuant to which such Debtor leased a 2016 Ford transit works mobility van VIN (last six) A69071 for a term of 48 months with a monthly rental payment of $1, [$479.37] ($23,968.50) u. Equipment Lease and Agreement of Sale no. XX dated as of May 3, 2016 with Pasadena SCC LLC, pursuant to which such Debtor leased a 2016 Ford Starcraft Allstar shuttle bus VIN (last six) C22757 for a term of 4

5 Case bjh11 Doc 568 Filed 02/25/19 Entered 02/25/19 09:00:11 Page 5 of months with a monthly rental payment of $1, [$463.68] ($23,184.00); v. Equipment Lease and Agreement of Sale no. XX dated as of May 3, 2016 with Pecan Valley SCC LLC, pursuant to which such Debtor leased a 2016 Ford Starcraft Allstar shuttle bus VIN (last six) C22746 for a term of 48 months with a monthly rental payment of $1, [$463.68] ($23,184.00); and w. Equipment Lease and Agreement of Sale no. XX dated as of July 14, 2015 with SCC Socorro LLC, pursuant to which such Debtor leased a 2015 Ford Starcraft Allstar shuttle bus VIN (last six) A16100 for a term of 48 months with a monthly rental payment of $1, [$250.00] ($9,952.00); (the aforedescribed equipment being collectively referred to as the Equipment ). 2. Each of the Lease Agreements with a $1 buy out option contains a grant of a security interest by the Debtor lessee to WFEF to secure the obligations under such Lease Agreement (the Lease Obligations ). WFEF perfected such security interests, as deemed appropriate, by filing UCC-1 financing statements with the Secretary of State of each Debtor s state of registration or by noting its lien on the certificate of title where applicable for vehicular Equipment. Senior Care Centers, LLC executed unconditional guaranties of the Lease Obligations in favor of WFEF with respect to each Lease Agreement. 3. WFEF asserts an aggregate claim of at least $2,634, secured by the Equipment where applicable. Such aggregate claim is not cross collateralized. 4. The Debtors continue to use the Equipment in connection with the operation of their senior care facilities and desire to retain the possession and use thereof postpetition. WFEF has demanded that the Debtors provide adequate protection of WFEF s interest in the Equipment, which is diminishing in value through the use and aging thereof while the Debtors have ceased making their contractual payments under the Lease Agreements and WFEF is stayed from the exercise of its remedies under Bankruptcy Code section 362(a). 5

6 Case bjh11 Doc 568 Filed 02/25/19 Entered 02/25/19 09:00:11 Page 6 of The Debtors contemplate that one or more Debtors may conduct postpetition sales of their assets under Bankruptcy Code section 363, which may involve the sale of the Equipment subject to $1 buy out Lease Agreements or assumption and assignment of any of the Lease Agreements that are true leases, and in certain cases may reject or agree that termination occurred as to real property leases relating to senior care facilities with regard to transitioning them to new operators, and may in such instances nevertheless seek to assume and assign applicable referenced lease(s) to assignee(s) despite such rejection or termination of the real property lease at issue or seek to sell the Equipment free and clear of liens to such transferee (subject to the above-referenced paragraphs with regard to the Debtors ability to assert that leases with a $1 end of term buy out are secured transactions). ACCORDINGLY, IT IS ORDERED, ADJUDGED, AND DECREED THAT: 1. The Motion is GRANTED as set forth herein. 2. Commencing the month of February 2019, as adequate protection for WFEF s interest in the Equipment, the Debtors shall make the bracketed payment amount detailed in Stipulated Facts (para. 1.a 1.w above.) to WFEF in lieu of the contractual monthly payment on the due date specified in each Lease Agreement, which payments shall continue until the earliest to occur of (a) the effective date of a confirmed plan of reorganization in the relevant Debtorlessee s chapter 11 bankruptcy case, (b) the effective date that the Lease Agreement is assumed and assigned by the relevant Debtor-lessee, (c) the effective date of rejection of the Lease Agreement as approved by the Bankruptcy Court, (d) the date that the Debtor-lessee tenders the Equipment for surrender to WFEF or it is sold in compliance with Bankruptcy Code section 363 to a third party purchaser pursuant to an order of the Court; or (e) satisfaction in full of the remaining Lease Obligations related to such Lease Agreement. 6

7 Case bjh11 Doc 568 Filed 02/25/19 Entered 02/25/19 09:00:11 Page 7 of The Debtors shall provide WFEF s agents with reasonable access to the Equipment to inspect and inventory same, and shall further promptly provide such information and documentation as WFEF may reasonably request regarding the location, condition, insurance, and care of the Equipment. 4. Nothing in this Order shall be construed to prejudice the respective rights or objections of the Debtors, WFEF, the Official Committee of Unsecured Creditors (the Committee ), CIBC Bank USA ( CIBC ) or any other party with standing with respect to proposed treatment of WFEF s claims and Equipment under any plan of reorganization, any proposed sale of the Equipment or assumption or assignment of the Lease Agreements, or allowance or disallowance of any proof(s) of claim or administrative rent claims filed by WFEF with respect to the Lease Obligations. For the avoidance of doubt, nothing in this Order affects any right of any party to claim or challenge any claim to allocation of, or interest in, any proceeds resulting from the sale of the Debtor s assets to the extent that such sale includes the Equipment. 5. If the Debtors determine that certain Equipment should be surrendered to WFEF, the the Debtors shall provide written notice to WFEF and Committee counsel that such Equipment is being surrendered, and absent any other order of the Court, on the eleventh (11 th ) day after such notice, the automatic stay shall be terminated as to such Equipment and WFEF shall be permitted to exercise its in rem rights and remedies with respect thereto, including taking physical possession thereof and conducting a foreclosure sale thereof. 6. WFEF may resume sending postpetition billings/invoices to the Debtors in connection with the Lease Agreement as same are modified consistent with the terms of this Order. 7. The automatic stay of Bankruptcy Code section 362(a) shall terminate as to any Equipment detailed in Stipulated Facts 1.a-1.w., for which the Debtor-lessee (a) fails to make a 7

8 Case bjh11 Doc 568 Filed 02/25/19 Entered 02/25/19 09:00:11 Page 8 of 10 required payment hereunder in full as and when due hereunder and fails to cure such payment default within ten (10) days of the date that WFEF or its counsel sends written or notice to the Debtor-lessee s and the Committee s respective counsel of record, or (b) permits loss insurance on the Equipment to lapse and fails to cure such default by providing WFEF with written confirmation of insurance reinstatement within three (3) business days of the date that WFEF or its counsel sends notice of default to the Debtors and Committee s respective counsel of record, and upon such termination of the automatic stay, WFEF shall be permitted to exercise its in rem rights and remedies with respect thereto, including taking physical possession thereof and conducting a foreclosure sale thereof. The right of WFEF to seek relief from the automatic stay in the event that the Debtors fail to keep or observe any covenant in the Lease Agreements that impairs WFEF s interest in the Equipment is hereby reserved. 8. Notwithstanding any Bankruptcy Rule or Local Rule to the contrary, this Order shall be immediately effective and enforceable upon its entry, and no stay shall apply. 9. This Court shall retain jurisdiction over any and all matters arising from the interpretation, implementation, or enforcement of this Order. # # # End of Order # # # 8

9 Case bjh11 Doc 568 Filed 02/25/19 Entered 02/25/19 09:00:11 Page 9 of 10 Ordered submitted by: 9

10 Case bjh11 Doc 568 Filed 02/25/19 Entered 02/25/19 09:00:11 Page 10 of 10 PALMER & MANUEL, LLP POLSINELLI PC /s/ Larry Chek /s/ Trey A. Monsour Larry Chek State Bar No Campbell Centre I, Suite North Central Expressway Dallas, Texas Telephone. (214) Facsimile: (214) Trey A. Monsour State Bar No N. Harwood, Suite 2100 Dallas, Texas Telephone: (214) Facsimile: (214) and- Jeremy R. Johnson (Admitted Pro Hac Vice) 600 3rd Avenue, 42nd Floor New York, New York Telephone: (212) Facsimile: (212) Counsel to Wells Fargo Equipment Finance, Inc. and Wells Fargo Bank dba Wells Fargo Equipment Finance Counsel to the Debtors and Debtors in Possession ROCHELLE McCULLOUGH, LLP /s/ E. P. Keiffer E. P Keiffer State Bar No Kevin D. McCullough State Bar No North Saint Paul St., Suite 4500 Dallas, Texas Telephone: (214) Facsimile: (214) pkeiffer@romclaw.com kdm@romclaw.com Conflicts Counsel to the Debtors and Debtors in Possession (as to indirect effect on Granite and KeyBank related issues) 10

Case bjh11 Doc 168 Filed 12/20/18 Entered 12/20/18 12:51:25 Page 1 of 9

Case bjh11 Doc 168 Filed 12/20/18 Entered 12/20/18 12:51:25 Page 1 of 9 Case 18-33967-bjh11 Doc 168 Filed 12/20/18 Entered 12/20/18 12:51:25 Page 1 of 9 Shad Robinson State Bar No. 24013412 HALEY & OLSON, P.C. 100 N. Ritchie Rd., Ste. 200 Waco, Texas 76712 Tel: 254-776-3336