in the united states bankruptcy court for …...1107(b), as supplemented by bankruptcy rules 2014(a)...

IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE

In re

John Varvatos Enterprises, Inc., et al.,

Debtors.1

Chapter 11

Case No. 20-11043 (MFW)

Jointly Administered

Hearing Date: June 12, 2020, at 10:30 a.m. (ET) Objection Deadline: June 5, 2020, at 4:00 p.m. (ET)

DEBTORS’ APPLICATION FOR ENTRY OF AN ORDER UNDER 11 U.S.C. §§ 327(a), 328(a), AND 1107(b), FED. R. BANKR. P. 2014 AND 2016, AND DEL. BANKR. L.R. 2014-

1 AND 2016-1, AUTHORIZING RETENTION AND EMPLOYMENT OF MORRIS, NICHOLS, ARSHT & TUNNELL LLP AS BANKRUPTCY COUNSEL FOR THE

DEBTORS NUNC PRO TUNC TO THE PETITION DATE

The above-captioned debtors and debtors in possession (the “Debtors”) in these Chapter

11 cases (the “Chapter 11 Cases”) hereby submit this application (the “Application”) for entry of

an order, substantially in the form attached hereto as Exhibit A, pursuant to sections 327(a),

328(a) and 1107(b) of title 11 of the United States Code (the “Bankruptcy Code”), Rules 2014

and 2016 of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”), and Rules

2014-1 and 2016-1 of the Local Rules of Bankruptcy Practice and Procedure of the United States

Bankruptcy Court for the District of Delaware (the “Local Rules”), authorizing the retention and

employment of Morris, Nichols, Arsht & Tunnell LLP (“Morris Nichols”) as bankruptcy counsel

to the Debtors nunc pro tunc to the Petition Date (as defined below). In support of the

Application, the Debtors rely upon and incorporate by reference (i) the Declaration of Derek C.

Abbott in Support of the Debtors’ Application for Entry of an Order Under 11 U.S.C. §§ 327(a),

1 The Debtors in these cases, along with the last four digits of each Debtor’s federal tax identification number are as follows: John Varvatos Enterprises, Inc. (3554); Lion/Hendrix Corporation (8784); and John Varvatos Apparel Corp. (3394). The Debtors’ corporate headquarters and mailing address is 26 West 17th Street, 10th Floor, New York, NY 10011.

Case 20-11043-MFW Doc 121 Filed 05/22/20 of 11

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328(a), and 1107(b), Fed. R. Bankr. P. 2014 and 2016, and Del. Bankr. L.R. 2014-1 and 2016-1,

Authorizing Retention and Employment of Morris, Nichols, Arsht & Tunnell LLP as Bankruptcy

Counsel for the Debtors Nunc Pro Tunc to the Petition Date (the “Abbott Declaration”), attached

hereto as Exhibit B, (ii) the Statement of Morris, Nichols, Arsht & Tunnell LLP Pursuant to 11

U.S.C. § 329, Fed. R. Bankr. P. 2016 and Bankr. D. Del. L.R. 2016-1 (the “Rule 2016

Statement”), attached hereto as Exhibit C, and (iii) the Declaration of Joseph Zorda in Support

of the Debtors’ Application for Entry of an Order Under 11 U.S.C. §§ 327(a), 328(a), and

1107(b), Fed. R. Bankr. P. 2014 and 2016, and Del. Bankr. L.R. 2014-1 and 2016-1, Authorizing

Retention and Employment of Morris, Nichols, Arsht & Tunnell LLP as Delaware Bankruptcy

Counsel for the Debtors (the “Zorda Declaration”), attached hereto as Exhibit D. In further

support of the Application, the Debtors respectfully state as follows:

JURISDICTION

1. The Court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 157 and

1334. This matter is a core proceeding within the meaning of 28 U.S.C. § 157(b)(2). Venue of

this proceeding and the Application in this Court is proper under 28 U.S.C. §§ 1408 and 1409.

2. The statutory bases for the relief requested herein are sections 327(a), 328(a), and

1107(b), as supplemented by Bankruptcy Rules 2014(a) and 2016 and Local Rules 2014-1 and

2016-1.

3. Pursuant to Rule 9013-1(f) of the Local Rules of Bankruptcy Practice and

Procedure of the United States Bankruptcy Court for the District of Delaware, the Debtors

consent to the entry of a final judgment or order with respect to the Application if it is

determined that the Court, absent consent of the parties, cannot enter final orders or judgments

consistent with Article III of the United States Constitution.


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BACKGROUND

4. On May 6, 2020 (the “Petition Date”), the Debtors filed voluntary petitions for

relief under chapter 11 of the Bankruptcy Code thereby commencing the Chapter 11 Cases. The

Debtors continue to operate their businesses as debtors in possession pursuant to sections

1107(a) and 1108 of the Bankruptcy Code. No party has requested the appointment of a trustee

or examiner to date in the Chapter 11 Cases. On May 18, 2020, the Office of the United States

Trustee (the “U.S. Trustee”) appointed an official committee of unsecured creditors (the

“Committee”) [D.I. 94].

5. A description of the Debtors’ businesses, corporate structure, and events leading

to the Chapter 11 Cases is set forth in the Declaration of Joseph Zorda in Support of First Day

Relief (D.I. 4) (the “First Day Declaration”), and is incorporated herein by reference.2

RELIEF REQUESTED

6. The Debtors desire to retain and employ Morris Nichols as their bankruptcy

counsel in the Chapter 11 Cases. By this Application, the Debtors respectfully request that the

Court enter an order authorizing the Debtors to retain and employ Morris Nichols as their

bankruptcy counsel, nunc pro tunc to the Petition Date, to represent the Debtors in all phases of

the Chapter 11 Cases.

BASIS FOR RELIEF

7. Under section 327(a) of the Bankruptcy Code, a debtor in possession may employ

one or more attorneys to represent it in carrying out its duties under the Bankruptcy Code,

provided that such attorneys are disinterested persons and do not hold or represent an interest

2 Capitalized terms used but not defined herein shall have the meanings ascribed to them in the First Day

Declaration.


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adverse to the estate. Section 101(14) of the Bankruptcy Code defines “disinterested person” as

one who

is not a creditor, an equity security holder, or an insider; [or] is not and was not, within 2 years before the date of the filing of the petition, a director, officer or employee of the debtor; and ... does not have an interest materially adverse to the interest of the estate or of any class of creditors or equity security holders, by reason of any direct or indirect relationship to, connection with, or interest in, the debtor, or for any other reason.

11 U.S.C. § 101(14).

8. Prior to the commencement of the Chapter 11 Cases, the Debtors retained Morris

Nichols to provide advice regarding, among other things, preparing for, commencing, and

prosecuting these cases under chapter 11 of the Bankruptcy Code. The Debtors have engaged

Morris Nichols as their bankruptcy counsel in connection with the filing and, subject to the entry

of an order approving the retention of Morris Nichols, the prosecution of the Chapter 11 Cases.

9. The Debtors seek to retain and employ Morris Nichols because the firm’s

attorneys have extensive experience representing debtors in chapter 11 cases before this Court.

Further, Morris Nichols attorneys have become familiar with the Debtors, their businesses, and

their financial affairs through assisting the Debtors both prior to, and in connection with, the

Chapter 11 Cases. For these reasons, Morris Nichols is well qualified to represent the Debtors as

bankruptcy counsel.

10. The Debtors request approval of the employment of Morris Nichols nunc pro tunc

to the Petition Date. Such relief is warranted by the extraordinary circumstances presented by

these cases. The Third Circuit has identified “time pressure to begin service” and absence of

prejudice as factors favoring nunc pro tunc retention. See Matter of Arkansas Co., 798 F.2d 645,

650 (3d Cir. 1986); see also In re Indian River Homes, Inc., 108 B.R. 46, 52 (D. Del. 1989).


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SERVICES TO BE PROVIDED BY MORRIS NICHOLS

11. The Debtors believe that the services of Morris Nichols are necessary to enable

them to faithfully execute their duties as debtors in possession. Subject to further order of this

Court, Morris Nichols will render the following professional services to the Debtors, in

coordination with the Debtors’ other advisors:

a. perform all necessary services as the Debtors’ bankruptcy counsel, including, without limitation, providing the Debtors with advice, representing the Debtors, and preparing necessary documents on behalf of the Debtors in the areas of restructuring and bankruptcy;

b. take all necessary actions to protect and preserve the Debtors’ estates during the Chapter 11 Cases, including the prosecution of actions by the Debtors, the defense of any actions commenced against the Debtors, negotiations concerning litigation in which the Debtors are involved and objecting to claims filed against the estate;

c. prepare or coordinate preparation on behalf of the Debtors, as debtors in possession, necessary motions, applications, answers, orders, reports, and papers in connection with the administration of the Chapter 11 Cases;

d. counsel the Debtors with regard to their rights and obligations as debtors in possession;

e. coordinate with the Debtors’ other professionals in representing the Debtors in connection with these cases; and

f. perform all other necessary legal services.

12. The Debtors believe that Morris Nichols’ employment is in the best interests of

the Debtors, their estates, and their creditors.

13. Subject to this Court’s approval of the Application, Morris Nichols is willing to

serve as the Debtors’ counsel and to perform the services described above.

DISINTERESTEDNESS OF MORRIS NICHOLS

14. To the best of the Debtors’ knowledge, information, and belief, and except to the

extent otherwise indicated in the Abbott Declaration, none of Morris Nichols’ partners, counsel,


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or associates hold or represent any interest adverse to the Debtors’ estates or their creditors, and

Morris Nichols is a “disinterested person,” as defined in section 101(14) of the Bankruptcy Code.

15. Other than the Debtors, Morris Nichols does not, and has not, represented any

entities in matters related to the Chapter 11 Cases. Morris Nichols may represent or may have

represented certain parties with interests in the Debtors’ cases on matters unrelated to the

Chapter 11 Cases. As set forth in the Abbott Declaration, Morris Nichols has conducted, and

continues to conduct, research into its relations with the Debtors, the Debtors’ substantial

creditors and equity security holders, and other parties interested in the Chapter 11 Cases. As

part of this inquiry, Morris Nichols obtained the names of individuals or entities that may be

parties in interest in the Chapter 11 Cases (the “Potential Parties in Interest,” attached to the

Abbott Declaration as Schedule 1). Morris Nichols then entered the names of Potential Parties in

Interest into a computer database containing the names of all clients and conflict information

concerning the clients of Morris Nichols.

16. This inquiry revealed that certain of the Potential Parties in Interest were current

or former Morris Nichols clients (the list of such clients is referred to herein as the “Client Match

List”). Current clients are listed on Schedule 2 attached to the Abbott Declaration and former

clients are listed on Schedule 3 attached to the Abbott Declaration. Through the information

generated from the above-mentioned computer inquiry, and through follow-up inquiries with

Morris Nichols attorneys responsible for certain clients listed on the Client Match List, Morris

Nichols determined that the representation of the clients on the Client Match List concerned

matters unrelated to the Chapter 11 Cases, except to the extent otherwise indicated in the Abbott

Declaration.


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17. While Morris Nichols has undertaken, and continues to undertake, efforts to

identify connections with the Debtors and other parties in interest, it is possible that connections

with some parties in interest have not yet been identified. Should Morris Nichols, through its

continuing efforts or as the Chapter 11 Cases progress, learn of any new connections of the

nature described above, Morris Nichols will advise the Court.

COMPENSATION

18. In connection with the Chapter 11 Cases, Morris Nichols was retained by the

Debtors under an advance payment retainer pursuant to an engagement letter executed by the

Debtors on January 16, 2020 (the “Engagement Agreement”). Morris Nichols received a

payment of $50,000 on February 5, 2020 as an advance fee for services to be rendered and

expenses to be incurred in connection with Morris Nichols’s representation of the Debtors. On

March 16, 2020, Morris Nichols received an additional advance payment of $200,000 for

services to be rendered and expenses to be incurred in connection with Morris Nichols’s

representation of the Debtors. On April 27, 2020, Morris Nichols drew down its retainer in the

amount of $127,590.87. On May 5, 2020, Morris Nichols received a payment of $423,453.37,

deducted $45,862.50 from the payment of $423,453.37 as a payment for services rendered and

expenses incurred and transferred the remaining amount of $377,590.87 as an advance fee for

services to be rendered and expenses to be incurred in connection with Morris Nichols’

representation of the Debtors. That same day, Morris Nichols drew down its retainer in the

amount of $66,662.10. Morris Nichols has not been paid any other compensation by the Debtors

within the 90 days before the Petition Date and Morris Nichols is not a creditor of the Debtors.

19. As of the Petition Date, Morris Nichols held a balance of $433,337.90 as an

advance payment for services to be rendered and expenses to be incurred in connection with its

representation of the Debtors (the “Advance Payment”).


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20. On May 7, 2020, Morris Nichols issued a final billing statement for $65,532.44

for the actual fees, charges, and disbursements for the period prior to the Petition Date (the

“Final Billed Amount”). The Final Billed Amount was paid from the Advance Payment, and the

balance of $367,805.46 will be held as a postpetition advance payment to be applied against any

unpaid fees and expenses approved by the Court with respect to Morris Nichols’s final fee

application in these cases.

21. In these cases, the Advance Payment held by Morris Nichols is appropriate. See

In re Insilco Techs., Inc., 291 B.R. 628, 634 (Bankr. D. Del. 2003) (“Factors to be considered,

include . . . whether terms of an engagement agreement reflect normal business terms in the

marketplace; . . . the relationship between the Debtor and the professionals, i.e., whether the

parties involved are sophisticated business entities with equal bargaining power who engaged in

an arms-length negotiation [and] . . . whether the retention, as proposed, is in the best interests of

the estate . . .”). First, agreements regarding retainers are commonplace and “reflect normal

business terms in the marketplace.” See id. at 634. Second, the Debtors and Morris Nichols are

sophisticated entities that have negotiated the Advance Payment at arm’s length. Third, the

Advance Payment is in the best interest of the Debtors and their estates because the Engagement

Agreement and the Advance Payment allow the Debtors and Morris Nichols to maintain their

prepetition relationship and assure continuity of legal advice and representation through the

prosecution of these bankruptcy cases. Thus, under the factors described by the Insilco court, the

facts and circumstances of these cases support the Court’s approval of the Advance Payment.

22. In addition, compensation for professional services rendered to the Debtors will

be based upon the hours actually expended by each assigned professional at each professional’s

hourly billing rate, as detailed further in the Abbott Declaration. Subject to Court approval in


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accordance with Bankruptcy Code sections 330 and 331, the Bankruptcy Rules, the Local Rules,

and the orders of this Court, the Debtors propose to compensate Morris Nichols for professional

services rendered at its normal and customary hourly rates in effect from time to time as set forth

in the Abbott Declaration.

23. Morris Nichols will also seek reimbursement for reasonable and necessary

expenses incurred, which shall include travel, photocopying, delivery service, postage, vendor

charges, and other out-of-pocket expenses incurred in providing professional services.

24. Morris Nichols intends to apply to the Court for the allowance of compensation

for professional services rendered and reimbursement of expenses incurred in accordance with

the applicable provisions of the Bankruptcy Code, the Bankruptcy Rules, and the Local Rules.

STATEMENT REGARDING U.S. TRUSTEE GUIDELINES

25. Morris Nichols intends to use its reasonable best efforts to comply with the

Guidelines for Reviewing Applications for Compensation and Reimbursement of Expenses Filed

Under 11 U.S.C. § 330 by Attorneys in Larger Chapter 11 cases, effective as of November 1,

2013 (the “Appendix B Guidelines”). To that end, Morris Nichols provides the following

statements in response to the request for additional information set forth in Part D.1. of the

Appendix B Guidelines:

Question: Did you agree to any variations from, or alternatives to, your standard or customary billing arrangements for this engagement?

Response: No.

Question: Do any of the professionals included in this engagement vary their rate based on the geographic location of the bankruptcy case?

Response: No. Question: If you represented the client in the 12 months prepetition, disclose

your billing rates and material financial terms for the prepetition


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engagement, including any adjustments during the 12 months prepetition. If your billing rates and material financial terms have changed postpetition, explain the difference and the reasons for the difference.

Response: In connection with the chapter 11 cases, Morris Nichols was

retained by the Debtors pursuant to the Engagement Agreement dated January 16, 2020. The material terms of the prepetition restructuring engagement are the same as the terms described in the Zorda Declaration.

For work performed for the Debtors in 2020, Morris Nichols’

hourly rates are as follows:

Partners $750–1,200 Associates and Special Counsel $435–725 Paraprofessionals $285–335

Question: Has your client approved your prospective budget and staffing

plan, and, if so, for what budget period? Response: The Court has approved a budget on an interim basis for Morris

Nichols’s engagement for the postpetition period, which budget is attached to the Interim Order Pursuant to 11 U.S.C. §§ 105, 361, 362, 363, 364, 503, 506, And 507, (I) Authorizing the Debtors to Obtain Secured Priming Post-Petition Financing, (II) Granting Liens and Superpriority Administrative Expense Claims, (III) Authorizing the Use of Cash Collateral, (IV) Granting Adequate Protection, (V) Modifying the Automatic Stay, (VI) Scheduling Final Hearing, and (VII) Granting Related Relief (D.I. 48).

NOTICE

26. The Debtors have provided notice of the hearing on this Application to: (i) the

U.S. Trustee; (ii) counsel to the Committee; (iii) counsel to Wells Fargo Bank, N.A.; (iv) counsel

to Lion/Hendrix Cayman Limited; and (v) any party who has requested notice pursuant to

Bankruptcy Rule 2002. In light of the nature of the relief requested in this Application, the

Debtors respectfully submit that no further notice is necessary.


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CONCLUSION

WHEREFORE, the Debtors respectfully request that this Court (i) grant this

Application and the relief requested herein; (ii) enter the proposed order attached hereto as

Exhibit A; and (iii) grant such other and further relief as it deems just and proper.

Dated: May 22, 2020 Wilmington, Delaware

MORRIS, NICHOLS, ARSHT & TUNNELL LLP /s/ Derek C. Abbott Derek C. Abbott (No. 3376) Matthew O. Talmo (No. 6333) Andrew R. Workman (No. 6710) 1201 N. Market Street, 16th Floor P.O. Box 1347 Wilmington, Delaware 19899-1347 Telephone: (302) 658-9200 Facsimile: (302) 658-3989 [email protected] [email protected] [email protected] Proposed Counsel to the Debtors and Debtors in Possession



In re:

Chapter 11

John Varvatos Enterprises, Inc., et al., Case No. 20-11043 (MFW)

Debtors.1 Jointly Administered

Hearing Date: June 12, 2020, at 10:30 a.m. (ET) Objection Deadline: June 5, 2020, at 4:00 p.m. (ET)

NOTICE OF THE DEBTORS’ APPLICATION FOR ENTRY OF AN ORDER UNDER 11

U.S.C. §§ 327(a), 328(a), AND 1107(b), FED. R. BANKR. P. 2014 AND 2016, AND DEL. BANKR. L.R. 2014-1 AND 2016-1, AUTHORIZING RETENTION AND EMPLOYMENT

OF MORRIS, NICHOLS, ARSHT & TUNNELL LLP AS BANKRUPTCY COUNSEL FOR THE DEBTORS NUNC PRO TUNC TO THE PETITION DATE

PLEASE TAKE NOTICE that today, the above-captioned debtors and debtors in

possession (the “Debtors”) filed the Debtors’ Application for Entry of an Order Under 11 U.S.C. §§ 327(a), 328(A), And 1107(b), Fed. R. Bankr. P. 2014 and 2016, and Del. Bankr. L.R. 2014-1 and 2016-1, Authorizing Retention and Employment of Morris, Nichols, Arsht & Tunnell LLP as Bankruptcy Counsel for the Debtors Nunc Pro Tunc to the Petition Date (the “Application”).

PLEASE TAKE FURTHER NOTICE that objections, if any, to the Application must be (a) in writing and served on or before June 5, 2020, at 4:00 p.m. (ET) (the “Objection Deadline”); (b) filed with the Clerk of the Bankruptcy Court, 824 N. Market Street, 3rd Floor, Wilmington, Delaware 19801; and (c) served so as to be received on or before the Objection Deadline by the undersigned counsel.

PLEASE TAKE FURTHER NOTICE THAT only objections made in writing and timely filed and received, in accordance with the procedures above, will be considered by the Bankruptcy Court at such hearing.

PLEASE TAKE FURTHER NOTICE THAT A HEARING ON THE

APPLICATION WILL BE HELD ON JUNE 12, 2020, AT 10:30 A.M. (ET) BEFORE THE HONORABLE MARY F. WALRATH, AT THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE, 824 MARKET STREET, 5TH FLOOR, COURTROOM #4, WILMINGTON, DELAWARE 19801.

1 The Debtors in these cases, along with the last four digits of each Debtor’s federal tax identification number are

as follows: John Varvatos Enterprises, Inc. (3554); Lion/Hendrix Corporation (8784); and John Varvatos Apparel Corp. (3394). The Debtors’ corporate headquarters and mailing address is 26 West 17th Street, 10th Floor, New York, NY 10011.

Case 20-11043-MFW Doc 121-1 Filed 05/22/20 Page 1 of 2

2

IF YOU FAIL TO RESPOND IN ACCORDANCE WITH THIS NOTICE, THE COURT MAY GRANT THE RELIEF REQUESTED IN THE APPLICATION WITHOUT FURTHER NOTICE OR HEARING. Dated: May 22, 2020 Wilmington, Delaware

MORRIS, NICHOLS, ARSHT & TUNNELL LLP /s/ Derek C. Abbott Derek C. Abbott (No. 3376) Matthew O. Talmo (No. 6333) Andrew R. Workman (No. 6710) 1201 N. Market Street, 16th Floor P.O. Box 1347 Wilmington, Delaware 19899-1347 Telephone: (302) 658-9200 Facsimile: (302) 658-3989 [email protected] [email protected] [email protected] Proposed Counsel to the Debtors and Debtors in Possession


EXHIBIT A

Proposed Order



In re John Varvatos Enterprises, Inc., et al.,

Debtors.1

Chapter 11 Case No. 20-11043 (MFW) Jointly Administered Re: D.I. ___

ORDER AUTHORIZING THE RETENTION AND EMPLOYMENT OF MORRIS, NICHOLS, ARSHT & TUNNELL LLP AS BANKRUPTCY COUNSEL FOR THE


Upon the Debtors’ Application for Entry of an Order Under 11 U.S.C. §§ 327(a), 328(A),

And 1107(b), Fed. R. Bankr. P. 2014 and 2016, and Del. Bankr. L.R. 2014-1 and 2016-1,

Authorizing Retention and Employment Of Morris, Nichols, Arsht & Tunnell LLP as Bankruptcy

Counsel for the Debtors Nunc Pro Tunc to the Petition Date (the “Application”)2 of the Debtors

in the Chapter 11 Cases for entry of an order, pursuant to sections 327(a), 328(a), and 1107(b) of

the Bankruptcy Code, Bankruptcy Rules 2014 and 2016, and Local Rules 2014-1 and 2016-1,

authorizing the retention and employment of Morris Nichols as bankruptcy counsel to the

Debtors nunc pro tunc to the Petition Date; and upon the Abbott Declaration, Statement of

Morris, Nichols, Arsht & Tunnell LLP Pursuant to 11 U.S.C. § 329, Fed. R. Bankr. P. 2016 and

Bankr. D. Del. L.R. 2016-1, and the Zorda Declaration, as attached to the Application; and the

Court being satisfied that Morris Nichols does not represent any interest adverse to the Debtors’

estates, that Morris Nichols is a “disinterested person” within the meaning of section 101(14) of

the Bankruptcy Code. and that the retention and employment of Morris Nichols is in the best



2 Capitalized not defined in this Order are defined in the Application.


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interests of the Debtors and their estates; and the Court having jurisdiction over the Application

pursuant to 28 U.S.C. § 157(b)(2)(A); and sufficient notice of the Application having been given

under the circumstances; and the Court having determined that the relief requested in the

Application is just and proper; and after due deliberation and sufficient cause appearing therefor;

IT IS HEREBY ORDERED THAT:

1. The Application is GRANTED as set forth herein.

2. The Debtors are authorized to retain and employ Morris Nichols as their attorneys

in the Chapter 11 Cases nunc pro tunc to the Petition Date.

3. The compensation to be paid to Morris Nichols for professional services rendered

and reimbursement for expenses incurred shall be as determined by this Court upon proper

application pursuant to sections 330 and 331 of the Bankruptcy Code.

4. Morris Nichols is authorized to hold the Advance Payment as security throughout

the Debtors’ bankruptcy cases until Morris Nichols’ fees and expenses are awarded and payable

to Morris Nichols on a final basis.

5. The Debtors are authorized and empowered to take such actions as may be

necessary and appropriate to implement the terms of this Order.

6. This Court shall retain jurisdiction with respect to all matters relating to the

interpretation or implementation of this Order.

Dated: ________________, 2020 Wilmington, Delaware

THE HONORABLE MARY F. WALRATH UNITED STATES BANKRUPTCY JUDGE


Exhibit B

Abbott Declaration


IN THE UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF DELAWARE


Debtors.1

Chapter 11 Case No. 20-11043 (MFW) Jointly Administered

DECLARATION OF DEREK C. ABBOTT IN SUPPORT OF THE DEBTORS’ APPLICATION FOR ENTRY OF AN ORDER UNDER 11 U.S.C. §§ 327(a), 328(a), AND 1107(b), FED. R. BANKR. P. 2014 AND 2016, AND DEL. BANKR. L.R. 2014-1 AND 2016-1, AUTHORIZING RETENTION AND EMPLOYMENT OF MORRIS, NICHOLS, ARSHT & TUNNELL LLP AS BANKRUPTCY COUNSEL FOR THE


I, DEREK C. ABBOTT, hereby declare under penalty of perjury:

1. I am a partner in the firm of Morris, Nichols, Arsht & Tunnell LLP (“Morris

Nichols”), which maintains an office for the practice of law at 1201 North Market Street, 16th

Floor, Wilmington, Delaware 19801. I am an attorney at law, duly admitted and in good

standing to practice in the state of Delaware as well as the United States District Court for the

District of Delaware and U.S. Court of Appeals for the Third Circuit.

2. I submit this declaration (the “Declaration”) in connection with the Debtors’

Application for Entry of an Order under 11 U.S.C. §§ 327(a), 328(a), and 1107(b), Fed. R.

Bankr. P. 2014 and 2016, and Del. Bankr. L.R. 2014-1 and 2016-1, Authorizing Retention and

Employment of Morris, Nichols, Arsht & Tunnell LLP as Bankruptcy Counsel for the Debtors

Nunc Pro Tunc to the Petition Date (the “Application”)2 and to provide certain disclosures under



2 Capitalized terms not defined in this Declaration are defined in the Application. Morris Nichols does not waive by the Application and this Declaration and their contents, and hereby reserves and preserves, all privileges.


2

sections 327(a) and 329(a) of the Bankruptcy Code, Bankruptcy Rules 2014 and 2016, and Local

Rules 2014-1 and 2016-1.

3. Except as otherwise indicated, I have personal knowledge of the matters set forth

herein and, if called as a witness, would testify competently hereto.3

4. Morris Nichols’ attorneys have knowledge and experience in bankruptcy,

reorganization, litigation, corporate governance, and other areas that are or may be relevant to


5. Insofar as I have been able to ascertain, Morris Nichols and its partners, counsel,

and associates do not have any material connection with the Debtors, their significant creditors,

or any other parties in interest herein or their respective attorneys or accountants, other than as

described in this Declaration.

6. Due to the size and diversity of Morris Nichols’s practice, Morris Nichols may

have represented or otherwise dealt with or may now be representing or otherwise dealing with

certain entities or persons (and their attorneys or accountants or both) who are or may consider

themselves to be creditors, equity security holders, or parties interested in the Chapter 11 Cases.

However, Morris Nichols does not and will not represent any entity other than the Debtors in

connection with these cases.

7. In addition, Morris Nichols is or has been engaged in a number of matters in

which attorneys and other professionals representing various parties in interest in these cases are

also involved; in a number of cases, Morris Nichols and those professionals represent or have

represented the same clients. Moreover, due to the nature and size of its practice, Morris Nichols

has or has had relationships as Delaware counsel, co-counsel, or referring counsel with many

3 Certain of the disclosures herein relate to matters within the knowledge of other attorneys at Morris Nichols and

are based on information provided by them.


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major law firms in most, if not all, major cities in the United States, which includes law firms

representing creditors or other parties in interest in these cases; all such relationships are on

matters unrelated to these cases. Morris Nichols is also a member of certain lawyer associations

and networks, including the TerraLex network and ALAS, a mutual insurance company owned

by law firms, which may include law firms representing creditors or other parties in interest in

these cases. Furthermore, Morris Nichols, as part of its practice, also has and continues to

represent agents, trustees, and similar entities in bankruptcy cases in which participants in the

related facilities may be or believe they are creditors or other parties in interest in the Chapter 11

Cases; Morris Nichols does not represent these participants and they are not generally part of

Morris Nichols’ conflict system.

8. Morris Nichols has conducted, and continues to conduct, research into its

relations with the Debtors, their creditors, and other parties interested in these cases. As part of

this inquiry, Morris Nichols obtained the names of individuals or entities that may be parties in

interest in the Chapter 11 Cases (the “Potential Parties in Interest”) annexed hereto as Schedule

1. Morris Nichols then entered the names of the Potential Parties in Interest into a computer

database containing the names of all clients and conflict information concerning the clients of

Morris Nichols. This inquiry revealed that certain of the Potential Parties in Interest were current

or former Morris Nichols clients (the list of such clients is referred to herein as the “Client Match

List”).4

9. Through the information generated from the above-mentioned computer inquiry,

and through follow-up inquiries with Morris Nichols attorneys responsible for certain clients

4 To the extent that a Client Match Entity disclosed in either Schedule 2 or Schedule 3 attached to the Abbott

Declaration is not an “affiliate” (as such term is defined in section 101(2) of the Bankruptcy Code) of or is otherwise unrelated to a Potential Party in Interest, such Client Match Entity shall not be construed as an affiliate of or entity related to such Potential Party in Interest and Morris Nichols reserves all rights with respect thereto.


4

listed on the Client Match List, Morris Nichols determined that the representation of the clients

on the Client Match List concerned matters unrelated to the Chapter 11 Cases. In particular, to

the best of my knowledge, information, and belief, (a) Morris Nichols currently serves as counsel

to those entities, and/or affiliates of those entities, identified on the schedule annexed hereto as

Schedule 2 on matters unrelated to the Chapter 11 Cases; and (b) Morris Nichols formerly

represented those entities, and/or affiliates of those entities, identified on the schedule annexed

hereto as Schedule 3 on matters unrelated to these cases since May 22, 2017. Morris Nichols’

computer data base covers a period of time prior to May 22, 2017; however, as a matter of

practice, Morris Nichols has not listed on Schedule 3 former clients for such prior period

(consistent with the disinterested time frames of three years).

10. Delaware Corporate Organizers, Inc., which provides no legal services, is a

wholly owned subsidiary of Morris Nichols, and serves as registered agent for certain Delaware

corporations (for which services no attorney-client relationship exists), performs various non-

legal corporate services and may serve as registered agent and/or performed other non-legal

corporate services for parties who are connected to these cases.

11. Gregory W. Werkheiser, a former partner in this firm, is married to Rachel L.

Werkheiser, who, since August 31, 2009, has been serving as a judicial law clerk to the

Honorable Christopher S. Sontchi, a Bankruptcy Judge in this District.

12. Furthermore, two individuals who may be employed by the Office of the United

States Trustee for the District of Delaware, Dion Wynn, or the United States Bankruptcy Court

for the District of Delaware, Bonnie Anemone, are former employees of Morris Nichols. Both

Mr. Wynn and Ms. Anemone left Morris Nichols more than ten years ago.


5

13. Other than as set forth herein, Morris Nichols is neither a creditor of the Debtors,

an equity holder of the Debtors, nor an insider of the Debtors. For so long as it represents the

Debtors, Morris Nichols will not represent any entities other than the Debtors in connection with


14. Neither Morris Nichols, any partner, counsel, or associate thereof, nor I represent

any interest adverse to the Debtors or the Debtors’ estates in the matters upon which Morris

Nichols is proposed to be engaged.

15. Morris Nichols is a “disinterested person” as that term is defined in 11 U.S.C.

§ 101(14) in that said firm and its partners, counsel and associates:

a. Are not creditors (including by reason of unpaid fees and expenses for prepetition services), equity security holders, or insiders of the Debtors;

b. Are not and were not, within two (2) years before the date of the filing of the Debtors’ chapter 11 petitions, a director, officer, or employee of any of the Debtors; and

c. Do not have an interest materially adverse to the interest of the estates or of any class of creditors or equity security holders, by reason of any direct or indirect relationship to, connection with, or interest in, the Debtor, or for any other reason.

16. In connection with the Chapter 11 Cases, Morris Nichols was retained by the

Debtors under an advance payment retainer pursuant to an engagement letter executed by the

Debtors on January 16, 2020 (the “Engagement Agreement”). Morris Nichols received a

payment of $50,000 on February 5, 2020 as an advance fee for services to be rendered and

expenses to be incurred in connection with Morris Nichols’s representation of the Debtors. On

March 16, 2020, Morris Nichols received an additional advance payment of $200,000 for

services to be rendered and expenses to be incurred in connection with Morris Nichols’s

representation of the Debtors. On April 27, 2020, Morris Nichols drew down its retainer in the

amount of $127,590.87. On May 5, 2020, Morris Nichols received a payment of $423,453.37,


6

deducted $45,862.50 from the payment of $423,453.37 as a payment for services rendered and

expenses incurred and transferred the remaining amount of $377,590.87 as an advance fee for

services to be rendered and expenses to be incurred in connection with Morris Nichols’

representation of the Debtors. That same day, Morris Nichols drew down its retainer in the

amount of $66,662.10. To the best of my knowledge, information, and belief, Morris Nichols

has not been paid any other compensation by the Debtors within the 90 days before the Petition

Date and Morris Nichols is not a prepetition creditor of the Debtors.










19. Subject to Court approval in accordance with Bankruptcy Code sections 330 and

331, the Bankruptcy Rules, and the orders and Local Rules of this Court, the Debtors propose to

pay Morris Nichols the following hourly rates in effect from time to time as set forth herein, plus

reimbursement of actual, necessary expenses incurred by Morris Nichols on the Debtors’ behalf.

The following are Morris Nichols’s currently hourly rates for work of this nature:

Partners $750–1,200 Associates and Special Counsel $435–725 Paraprofessionals $285–335 Case Clerks $175


7

20. These hourly rates are adjusted from time to time, typically at the beginning of the

year.

21. Morris Nichols will comply with all of the requirements of this Court, the

Bankruptcy Code and the Bankruptcy Rules with respect to fee and expense applications of

professionals employed by bankruptcy estates. Morris Nichols will seek interim and final

approval of payment of compensation and reimbursement of expenses in connection with the

Chapter 11 Cases pursuant to sections 330 and 331 of the Bankruptcy Code, the Bankruptcy

Rules, and the applicable orders and Local Rules of this Court.

22. All filing fees in the Chapter 11 Cases have been paid.

23. Morris Nichols intends to use its reasonable best efforts to comply with the

Guidelines for Reviewing Applications for Compensation and Reimbursement of Expenses Filed

Under 11 U.S.C. § 330 by Attorneys in Larger Chapter 11 cases, effective as of November 1,

2013 (the “Appendix B Guidelines”). To that end, Morris Nichols provides the following

statements in response to the request for additional information set forth in Part D.1. of the

Appendix B Guidelines:

Question: Did you agree to any variations from, or alternatives to, your standard or customary billing arrangements for this engagement?

Response: No.

Question: Do any of the professionals included in this engagement vary their rate based on the geographic location of the bankruptcy case?

Response: No. Question: If you represented the client in the 12 months prepetition, disclose

your billing rates and material financial terms for the prepetition engagement, including any adjustments during the 12 months prepetition. If your billing rates and material financial terms have changed postpetition, explain the difference and the reasons for the difference.


8

Response: In connection with the chapter 11 cases, Morris Nichols was

retained by the Debtors pursuant to the Engagement Agreement dated January 16, 2020. The material terms of the prepetition restructuring engagement are the same as the terms described in the Zorda Declaration.

For work performed for the Debtors in 2020, Morris Nichols’

hourly rates are as follows:

Partners $750–1,200 Associates and Special Counsel $435–725 Paraprofessionals $285–335

Question: Has your client approved your prospective budget and staffing

plan, and, if so, for what budget period? Response: The Court has approved a budget on an interim basis for Morris

Nichols’s engagement for the postpetition period, which budget is attached to the Interim Order Pursuant to 11 U.S.C. §§ 105, 361, 362, 363, 364, 503, 506, And 507, (I) Authorizing the Debtors to Obtain Secured Priming Post-Petition Financing, (II) Granting Liens and Superpriority Administrative Expense Claims, (III) Authorizing the Use of Cash Collateral, (IV) Granting Adequate Protection, (V) Modifying the Automatic Stay, (VI) Scheduling Final Hearing, and (VII) Granting Related Relief (D.I. 48).

24. Further, Morris Nichols and its partners, counsel and associates have not received,

agreed to, or been promised any compensation in connection with its representation of the

Debtors in these cases other than as set forth in the Application.

25. Morris Nichols has neither shared nor agreed to share (a) any compensation it has

received or may receive with another party or person, other than with the partners, counsel and

associates of Morris Nichols, or (b) any compensation another person or party has received or

may receive.

26. The proposed employment of Morris Nichols is not prohibited by or improper

under Bankruptcy Rule 5002. Except as disclosed herein, I am not related, and to the best of my

knowledge, information, and belief, no attorney at the Morris Nichols is related, to any United


9

States Bankruptcy Judge or District Court Judge for the District of Delaware or to the United

States Trustee for such district or any employee in the office thereof.

27. By reason of the foregoing, I believe that Morris Nichols is eligible for retention

and employment as bankruptcy counsel for the Debtors pursuant to sections 327(a) and 1107(b)

and the applicable Bankruptcy Rules and Local Rules.

Executed on May 22, 2020 Wilmington, Delaware

/s/ Derek C. Abbott Derek C. Abbott


Schedule 1

Potential Parties in Interest List

Debtors John Varvatos Enterprises, Inc. Lion/Hendrix Corporation John Varvatos Apparel Corp. Lenders Wells Fargo Bank, N.A. Lion/Hendrix Cayman Limited Debtors’ Counsel Morris, Nichols, Arsht & Tunnell LLP Debtors’ Professionals Clear Thinking Group LLC MMG Advisors, Inc. Lender’s Counsel Burr & Forman LLP Reimer & Braunstein LLP Sullivan & Cromwell LLP Young Conaway Stargatt & Taylor, LLP Insurance Companies, Brokers, Financers AXIS Insurance Company Beazley Insurance Company, Inc. CAC Specialty Chubb Insurance Company of Canada Continental Insurance Company Federal Insurance Company Federal Insurance Company Great Midwest Insurance Company Great Northern Insurance Company Great Northern Insurance Company Marsh USA Inc. Pacific Indemnity Insurance Company

RSUI Indemnity Company RSUI Indemnity Company Zurich American Insurance Company Litigation Parties Acacia Feldman Alicia Frazier Allexis La Porte Alyssa Hickey Andrea Palacios Angel Lane Angela Shin Angela Townsend Arissia Tossetti Ashleylynn Clare Carly Call Carolina De Castro Rocha Cheryl Somekh-Crouchen Chloe Lahey Christina Torres Claire Anderson Crystal Guinto Diana Guzman Ekaterina Voloschenko Fanta Souare Francesca Schelfhout Genevieve Dubuque Giselle Bellomo Golaleh Hassanzadeh Gozde Susel Hillary Crandle Ingrid Lazo Jamie Rudnick Janna Doyle Jazlyn Ramos-Garcia Jena Tobak Jessica Afonso Jessica Sgandurra Jin Hur Jordan VanWinkle


2

Joy Fusaro Julia Mastroeni Kaitlin Brinkman Karen Hor Kariann Spielberg Karla Gomez Kayleigh Landi Kelsey McCarthy Kristy Ann Velez Larisa Soto-Briones Laura Bethencourt Laurentina Chaparro Leticia Kentish Malena Machado Margaret Holcomb Marianna Ranz Mariecris Arcaparlas Mayra Lavallee Michelle Lancina Michelle Marks Michelle Ortiz Mimoza Previzi-Omar Morgan Flynn Nicole Purdy Pamela Kassen Pamela Zuniga Paulyna Garcia Ruby Romero Tessa Knox Tripti Pandey Veronica Porter Victoria Albanese Viviane Arjona Wijdan Shoubaki Yasmin Yacoub Yiwa Wang Zayana Dakinova Regulatory Agencies Securities and Exchange Commission Internal Revenue Service United States Department of Justice Delaware Secretary of State Delaware Secretary of the Treasury

Taxing and Licensing Authorities Bal Harbour Village Bayside City Marshal Boston Office of the City Clerk Broward County Tax Collector California Department of Tax and Fee Administration California State Board of Equalization California Travel and Tourism Commission California Workers’ Compensation Institute Canada Border Service Agency Canada Revenue Agency City & County of San Francisco Tax Collector City of Beverly Hills Finance Administration/Utility Billing City of Boston City of Costa Mesa City of Detroit Treasurer City of Las Vegas Department of Planning, Business License Division City of Livermore City of Malibu City of San Diego Development Services City of San Diego Office of the City Treasurer City of Sunrise Business Tax Office City of West Hollywood Clark County Assessor Clark County Business License Comptroller of Maryland County of Orange Treasurer-Tax Collector Dallas County Tax Office East Hampton Tax Receiver Fairfax County Department of Tax Administration Florida Department of Revenue Georgia Department of Revenue Government of Ontario, Ministry of Finance Harris County Tax Office Internal Revenue Service Los Angeles County Fire Department Los Angeles County Sheriff’s Department Los Angeles County Treasurer


3

Los Angeles County Treasurer and Tax Collector Los Angeles Treasurer-Tax Collector Maryland State Department of Assessments & Taxation Massachusetts Department of Revenue Miami-Dade County Tax Collector Michigan Department of Treasury Nevada Department of Taxation Nevada Secretary of State New Jersey Division of Revenue New Jersey Division of Taxation New York City Department of Consumer Affairs New York City Department of Finance New York City Fire Department New York Commissioner of Taxation and Finance New York State Department of Labor Ohio Department of Taxation Ontario Workplace Safety & Insurance Board Riverside County Treasurer Sacramento Franchise Tax Board San Diego County Treasurer Tax Collector State of Delaware Division of Corporations Texas Comptroller of Public Accounts The Receiver General for Canada Town of Woodbury, Town Clerk’s Office U.S. Customs and Border Patrol U.S. Fish & Wildlife Services Village of East Hampton Village of Woodbury Virginia Department of Taxation Woburn Receivable Management Corporation Utilities APX Net, Inc. AT&T Bell Canada Beverly Hills Water Department Central Hudson Gas & Electric Corporation Centurylink Comcast

Con Edison Duke Energy Corp. Enbridge Gas Distribution Eversource Florida Power & Light Frontier Communications Corporation Granite Telecommunications Megapath Cloud Company LLC Mesa Water District Mettel Miami Dade County Water and Sewer Dept. Nevada Energy Orange & Rockland PG&E PSEG Long Island Ring Central, Inc. Rocket Fiber LLC SDG&E dba San Diego Gas & Electric Southern California Edison Southwest Gas Corporation Spectrum Business Startex Power Toronto Hydro-Electric Systems Ltd. Verizon, Inc. Bankruptcy Judges Hon. Brendan L. Shannon Hon. Christopher S. Sontchi Hon. Kevin Gross Hon. Kevin J. Carey Hon. Laurie Selber Silverstein Hon. Mary F. Walrath Hon. John T. Dorsey Hon. Karen B. Owens Bankruptcy Court Staff Laura Haney Sherry Scaruzzí Donna Grottini Nancy Hunt Jill Walker Rachel Bello Cheryl Szymanski Danielle Gadson


4

Catherine Farrell Laurie Capp Lora Johnson Cacia Batts Janet Moore Rachel Werkheiser Una O’Boyle U.S. Trustee & Staff T. Patrick Tinker David Buchbinder Linda Casey Timothy J. Fox, Jr. Benjamin Hackman Brya Keilson Mark Kenney Jane Leamy Hannah M. McCollum Linda Richenderfer Juliet Sarkessian Richard Schepacarter Rose Sierra Jaclyn Weissgerber Other Interested Parties 1020 Lincoln Road, LLC 1145 Forum Shops, LLC 1500 Webward Avenue, LLC 54 Newton Lane, LLC AB Industries Abel A. Aguilera Able Billion Sourcing And Design Limited Acorn Conceptual Textiles Acronis Inc. Activaire LLC ADA Inspection Services ADP LLC Adtheorent Inc. Aetna Aetna Behavioral Health, LLC A-Girls Co. Ltd. Air Park International Aireactor Systems & Service Inc. dba Airite Airstream Air Conditioning Corp.

AJ Squared Security Ala Campolmi Alliance Glass, Inc. Allstar Security & Consulting Inc. American Apparel & Footwear Association American Express American Red Cross Amfar Andre 1 Custom Shoes Inc. Andres Sette Arruza Angela De Bona Agency Annas Alterations LLC Ansarada Pty Limited Any Perk, Inc. Ao Sgs Vostok Limited Arpel Deri Artsy Flora Inc. Artwell Holdings Limited Athens Services Atlantic Constructors Inc. Atlantic Mills (Thailand) Aurus AXA Equitable Life Insurance Company Axper Azienda Foderami Dragoni Spa B Live, LLC BBC Jacquard Srl Benchmarque Etude Syliste Benefit Resource, Inc. Beppetex Srl Berto E.G. Industria Tessile Beth Pakradooni Studio, Inc. Bhartiya International Ltd. Bleckmann Belgie NV BMS Neon Sign Bonotto Spa Borderfree Inc. Borgodue Srl Botto Giuseppe & Figli Spa Botto Giuseppe & Figli Spa (USD) Bottonificio Seltecolli Bravery for All, LLC Break Mgmt. Brenton Diallo Brian Evans Bright Generation Ent. Ltd.


5

Brinks Canada Ltd. BSK Associates BT Bunny Shoes Di Fabio E Riccardo Bargi S.A.S. Burns Factory Cablevision Systems Corporation Calzaturificio Victor Srl Canepa S.P.A. (Euro) Canepa Spa (USD) Capitol Light Carlis C. Conner Jr. Carlo D'Angelo Srl Cattle Baron's Ball CC Productions LLC Century City Mall, LLC Ceridian - Canada Ceridian Client Funds Ceridian Small Business Cervotessile S.P.A. Cervotessile Textile (Suzhou) Co Ltd. Champion Couriers Inc. Charge and Ride Chelsea Music Hall CHH America, Inc. Ching Fung Apparel Access City of Beverly Hills City of Las Vegas Cityside Archives Ltd. Clear Law Institute Closing Time Cocktail, LLC Clutch Holdings LLC Code Consultants, Inc. Codice - Infinity Srl Cofil S.R.L. Color X Inc. Columbia Omnicorp Comero S.P.A. Comero Spa Conceria Eugenia Srl Conceria Masini Spa Concur T&E Co 10 Only Concur Technologies Inc. Conde Nast NY Conde Nast Publications Contract Datascan, LP

Copious Management Inc. Copley Place Associates LLC Cotonificio Albini S P A Cottex LLP Cox Communications, Inc. Crialme crowdMGMT, LLC Cuatrecasas Cybersource Corporation Da Lian Tai Yang Ying Garments Co., Ltd. Dalian Dongda Garment Co., Ltd. D'Angelico Guitars of America LLC Dash Hudson David Siegel Dayang Alliance LLC De Rigo Rem Dean Billings dba Pest Elimination Sys Tech Inc. Deloitte Denim Kumascilik Tic Ve San Ltd. Sti Desert Hills Premium Outlet Partners, L.P Design Packaging Design Partners LLC DGA Security Systems DHL Express USA Di & Son Service Ltd. Di. Ve S.P.A. Dial-A-Bug Pest Control Diana Wilburn Digital Evolution Group LLC Dinamo Contemporary Fabrics Directed Online Discovery Benefits Inc. Distinctive Display Inc. Dixon Wilson DL Leather Documentary Designs Inc. Dominant Garments Fty. Ltd. Draper Co., Ltd. Dress Italy S.R.L. Drive In 24 LLC dba Root NYC Duksung Inco Co., Ltd. Edicate Button & Garment Accessories Mfy Ltd. EFM Mgmt Inc. Elizabeth Arden (Canada) Ltd.


6

Elizabeth Arden UK Elizabeth Arden, Inc. Emmetex Emporium Mall LLC Epstein Becker & Green, P.C. Erdos Group HK Ernest A. Liberati Erre Emme Soule Silga Gomma Errepi Essential Publications U.S. LLC Euler Hermes Services North America LLC Euro Tessile S.P.A European Tailoring Evolv Clothing Company Ltd. Fabrica Tessuti Facebook, Inc. Factotum Shoes & Leather Fair Factories Clearinghouse, Inc. Faliero Sarti L'Accessori Fashion GPS, Inc. Fashion Valley Mall, LLC Fashioners NY Inc. Federal Express Europe Inc. Fedex Fibel Fidelity Investments Findmine Inc. Fit Models LLC Fiveol Textil Spa Fluid, Inc. FMP Payroll Services Ford Models Inc. Forrest Solutions Fortex Fortiustex, Comercio De Texteis S.A. FPL - Acct No 28512-77190 Frameless Asia Pacific Limited Franco Vago (UK) Ltd. Franco Vago Air & Sea Ser - HK (USD) Franco Vago Inc. - NY (USD) Franco Vago International Logistics (Shanghai) Ltd. Franco Vago Spa Franco Vago, LDA Fratelli Guarino Di Donato SNC Free Style S.R.L

Friends of the Bass Museum Inc. Funkshion LLC Gabriel Byer Garda Cl East-Lockbox #233209 Gary Petersen Photography Inc. General Information Services, Inc. Genesis Publications Ltd. Gilbert Displays Inc. Gilwood China Co., Ltd. Gilwood International Co., Ltd. Gleiss Lutz Global Design ID Inc. Google Inc. Great West Life Greentree Landscaping, Inc. Group Nine Media Inc. Groupby USA Inc. GS1 US Inc. Guabello Guard Services USA Inc. Gunduz Kurk-US Gurhan New York, Inc. GXS Hama UK Ltd. Hatteras Hebei Hongye Cashmere Co., Ltd. Hedleys Humpers Ltd. Her Min Textile Co, Ltd. Hero Tower Lim Hewlett-Packard Financial Services Company HG Galleria I, II, III, LP Hieu Truang High Country Millwork, Inc. HLC Linen Group USA, Inc. Hong Kong Mandarin (Jimay) International Ltd. Hope Star Overseas Limited Hotwire Unlimited LLC Hughes Hubbard & Reed LLP Hypebeast Hong Kong Limited Ideal Fastener Asia Ltd. Ideal Fastener Europe SAGL Ideal Fasteners India Ltd. IMG Models LLC Imperial Commercial Cleaning, Inc.


7

Infinity Global Inc. Ingram Book Co. Inpelsa Inseta Srl Intelli-Tec Interdoma S.L. Interim Management Answers Intertek Italia S.P.A (Euro) Intertek Test Hizmetleri A.S. Intertek Testing Services Peru SA Intertek Testing Services Shenzhen Ltd. Intertrade Systems Inc. Italtessil SRL ITS Worldwide, LLC J W A Shopfitting Solution Ltd. Jack Studios, Inc. Jagged Peak Inc. Jasper Peto France Sarl (USD) JBCStyle NY LLS Jessica Cecere Jodan Corporation Jolene Paolozzi Jones Mgmt Jowoo Limited JV Italian Services Srl Kailas Photography Katten Keter Environmental Services Inc. Kirstin Gellatly Klein Moynihan Turco LLP Kleinschmidt Inc. Kliger-Weiss Infosystems, Inc. KM Associates of NY, Inc. Knight Bilham Photography Knopf Und Knopf International Konica Minolta Konica Minolta Business Solutions USA Inc. Konica Minolta Premier Koojoo Textile Co Ltd. L Industries Ltd. La Doma Lab Srl Lanificio Caverni Srl Lanificio Del Casentino S Lanificio F.lli Bacci

Lanificio F.lli Cerruti spa Lanificio Luigi Ricceri spa Lanificio Tg Di Fabio (USD) Lanificio Tg Di Fabio spa (Euro) Lanificio Zignone Lanny K W Inc. Lardini Srl Lars Nord Studio Inc. Lawrence H Meyer Leggiuno Spa Leslie Perkins Lever Apparel Ltd. Lever Shirt Limited Lexer Pty Ltd. LF Centennial PTE Ltd. Lion Capital Listrak Inc. Littler Mendelson, PC Livermore Premium Outlets LLC Luxos Italia Sri Lyria Srl M & M Sanitation Corp Mabo International S R L Mabo International Srl (US) Mackenzie Taylor Benefits Consultants Ltd. Major Model Management, Inc. Malibu Cross Creek, Ltd. Malibu Foundation Manhattan Mechanical Contractors, Inc. Mantero Seta Spa Manulife Financial Marcello's dba Garzon Investment Partnership Marco Pastorelli Spa Mariano's Tailor Marini & Cecconi Marini Industrie Spa Marmara Deri San. Ve Tic Ltd. Sti Maroon Mountain Inc. Martiape Massive Music Group Mattec Srl Matthew Sabato Max Leather Soc. Coop Arl Maxim Service Group Inc. MBH Architects, Inc.


8

Meba Tekstil San Ve Turizm Yatirimlari A.S. Meenakshi (India) Ltd. Mel & Rose Wine & Spirits Melrose High Street Holdings LLC Melrose Robertson Holdings LLC Mesura Tekstil San Ve Tic Ltd. Sti Metalbottoni Metalux Imaging Microsoft Corporation Milk Studios, LLC. Millennium Steel & Rack Rentals, Inc. Modas Eva USA Inc. Modelleria Cenzi Di Lapponi Moreno Modern Testing Services LLC Morrison Cohen LLP Movember Foundation MTC Casting Inc. Munro Tailoring Nahanco Nalya S.P.A Nalya Spa National Book Network National Waste Services LLC New WTC Retail, LLC Nexgen Packaging Ltd. Nexgen Packaging, LLC Nice Tones Ltd. Niceriver Development Limited Northpark Partners, LP Nova Accessories Ltd. Novexco Inc. NST Apparel (Europe) Lda. NYC Department of Finance NYC Fire Department Oakhurst Partners LLC Omnitrans Inc. Orient Forest Ltd. Orlando Vineland Po LP Paul Fazio Pepperjam LLC Permit Place Inc. Picasso Pellami S.R.L. Pinori Filati Spa Pipp Mobile Storage Systems Inc.

Pitney Bowes Global Financial Services LLC Pivotal Integrated HR Solutions Pontoglio S.P.A. Pool Trend Srl Pooltrend Post LLC Premier Supplies USA Inc. PricewaterhouseCoopers LLP Pride Media Profits Fund Fashion Manufacturing Ltd. Proforma Management Systems Purple USA Inc. Quadbridge Inc. Quench USA, Inc. R. K. Industries IV Radius8, Inc. Rakuten Card Linked Offer Network Randa Accessories Leather Goods LLC Raymond UCO Denim Private Limited Rebel Rebel Realty, Inc. Recology Golden Gate Red Eye Productions, Inc. Redaelli Niedieck Girmes Reltex Sas Rene Fragoso Representation Services NV/Sa Retail Solutions Rhino Entertainment Company Richa Global Exports Pvt Ltd. Riopele Texteis (US) Riskified Inc. RLM Apparel Software Robert Burns Wines Rock Paper Photo, LLC Rocky Trucking Corp. Ryan Scherb Sacchettificio Toscano Salesforce.Com, Inc. Salt Studios LLC Sandy Dias dba SJD USA Inc. Sanko Tekstil Sarl Vp Victor Perez Savino Del Bene - FDS Inc. Savino Del Bene USA Inc. Savino Del Bene USA Inc.


9

Sawgrass Mills Phase IV, LLC Scarsdale Security Inc. Secom Plc Seliger Studio Inc. Sen Deri Ve Servizi E Seta Srl SF-Water SGS Hong Kong Ltd. SGS Korea SGS North America Inc. Shabby Castle Shearling Service Srl Shellac NYC LLC Sher Packaging Limited Hong Kong Sher Plastics, LLC Shideh Kafei Shiraz NYC Inc. Dba Shiraz Events Shoe Lab Shred-It USA Inc. Shree Bharat International Pvt. Ltd. Silhouette Studio Digital LLC Simon/Chelsea Las Vegas Development, LLC Sistema Tessile Srl - Euro Sky I T Group SMI Tessuti Spa Solomon Page Group LLC SoundStage Direct South Coast Plaza South Ocean Knitters Limited Southern California Mess. Southwest Sign Co. Stephen Gutierrez Storage Deluxe Management Company LLC Studio Massimo Natali Srl Uninominale Swalec Takihyo Co Ltd. Talior It! Telecheck Services, Inc. Terminix Processing Center The Agency Arizona The Blue Factory Limited The Business of Fashion Inc. The Design Library The Developers S.A. The Empowerment Plan

The Music Bed LLC The Ritz Carlton Hotel Company LLC The Society Model Management Inc. Throat Threads Apparel Inc. Tiger Button Co Inc. Time Payment Corp dba Alpine Water Sys Time Warner Cable (Melrose) Time Warner Cable Business Class Tom Cody Design Inc. Towncross Ltd. Transperfect Translations International, Inc. Tuv Rheinland of North America, Inc. Tyson Galleria LLC Uline Uline Canada Corp Unicorn Trimmings Limited Uniform Apparel Limited United Parcel Service Italia S.R.L Unitika Tsusho Ltd. Unot Constructora Sa De Cv UPS US Coffee Inc. Usak Cevahir Deri Valerie Wilson Travel, Inc. Vanzetta E Associati Verde Garment Manufacturing Limited Veriship VF Mall, LLC Village Party Store Vinyl Baby LLC VIP Connection Inc. Vision Service Plan Vivolo Srl Vizyon Deri San.Ve Tic. A.S W.B. Mason Co Inc. Walter Schupfer Management Waste Connections Wellen Int'l Textile Ltd. Wen-Parker Logistics, Inc. Western Studio Service Inc. Whitehaus Media Group LLC Wilhelmina International Ltd. William Henry Knives Inc. Winget Cyc Industrial Ltd. Winner Step Corporation Limited Winter Management Corp.


10

WIS Corporation Woodbury Common Premium Outlets Worksmith Inc. World Textile Sourcing Worldnet International Wpromote LLC Xacus S.R.L (Euros) Xacus S.R.L. XO Communications LLC Xpo Last Mile Inc. dba Xpo Logistics Yagi Tsusho (America), Inc. Yale Breslin Yorkdale Shopping Centre RE Holdings Inc. Youngbo Worldwide Co. Ltd. Yunah Apparel Co., Ltd. Zhuo Diao


Schedule 2

Morris Nichols represents the Potential Parties in Interest and/or affiliates thereof identified below on matters unrelated to the Chapter 11 Cases. American Express AT&T AXA Equitable Life Insurance Company Cox Communications, Inc. Deloitte Facebook, Inc. Fidelity Investments Affiliates Google LLC Granite Telecommunications Lion/Hendrix Cayman Limited Affiliates Microsoft Corporation PricewaterhouseCoopers LLP Rakuten Card Linked Offer Network Salesforce.com, Inc. UPS Wells Fargo Bank, N.A.


Schedule 3

Morris Nichols formerly represented the Potential Parties in Interest and/or affiliates thereof identified below on matters unrelated to the Chapter 11 Cases. Draper Co., Ltd. Affiliates Duke Energy Corp. Enbridge Gas Distribution Affiliates Fashion GPS, Inc. Hewlett-Packard Financial Services Company PricewaterhouseCoopers Advisory Services LLC Southwest Gas Corporation Verizon, Inc.


Exhibit C

Rule 2016 Statement




Debtors.1


STATEMENT OF MORRIS, NICHOLS, ARSHT & TUNNELL LLP PURSUANT

TO 11 U.S.C. § 329, FED. R. BANKR. 2016, AND DEL. BANKR. L.R. 2016-1

Morris, Nichols, Arsht & Tunnell LLP (“Morris Nichols”) pursuant to section 329 of

Title 11 of the United States Code, Rule 2016 of the Federal Rules of Bankruptcy Procedure, and

Rule 2016-1 of the Local Rules of Bankruptcy Practice and Procedure of the United States

Bankruptcy Court for the District of Delaware, respectfully states as follows:

1. Morris Nichols is the proposed bankruptcy counsel for the above-captioned

debtors and debtors in possession (the “Debtors”) in the Chapter 11 Cases.

2. This Statement is made and submitted in connection with the Debtors’

Application for Entry of an Order under 11 U.S.C. §§ 327(a), 328(a), and 1107(b), Fed. R.

Bankr. P. 2014 and 2016, and Del. Bankr. L.R. 2014-1 and 2016-1, Authorizing Retention and

Employment of Morris, Nichols, Arsht & Tunnell LLP as Bankruptcy Counsel for the Debtors

Nunc Pro Tunc to the Petition Date (the “Application”).2

3. The Debtors have agreed to pay Morris Nichols for the legal services rendered or

to be rendered on the Debtors’ behalf by Morris Nichols attorneys and paralegals, which include



2 Capitalized terms not defined in this Statement are defined in the Application.


2

those services set forth in the Application. The Debtors also have agreed to reimburse Morris

Nichols for its actual and necessary expenses incurred in connection with the Chapter 11 Cases.

4. Morris Nichols was retained by the Debtors under an advance payment retainer

pursuant to an engagement letter executed by the Debtors on January 16, 2020 (the “Engagement

Agreement”). Morris Nichols received a payment of $50,000 on February 5, 2020, as an

advance fee for services to be rendered and expenses to be incurred in connection with Morris

Nichols’ representation of the Debtors. On March 16, 2020, Morris Nichols received an

additional advance payment of $200,000 for services to be rendered and expenses to be incurred

in connection with Morris Nichols’ representation of the Debtors. On April 27, 2020, Morris

Nichols drew down its retainer in the amount of $127,590.87. On May 5, 2020, Morris Nichols

received a payment of $423,453.37, deducted $45,862.50 from the payment of $423,453.37 as a

payment for services rendered and expenses incurred and transferred the remaining amount of

$377,590.87 as an advance fee for services to be rendered and expenses to be incurred in

connection with Morris Nichols’ representation of the Debtors. That same day, Morris Nichols

drew down its retainer in the amount of $66,662.10.









3



7. Morris Nichols will seek approval of payment of compensation upon its filing of

applications for allowance of interim or final compensation pursuant to sections 330 and 331 of

the Bankruptcy Code, the Bankruptcy Rules, the Local Rules, and any applicable orders of this

Court.

8. All filing fees in the Chapter 11 Cases have been paid.

9. Morris Nichols further states that it has neither shared, nor agreed to share (a) any

compensation it has received or may receive with another party or person, other than with the

partners, counsel, and associates of Morris Nichols, or (b) any compensation another person or

party has received or may receive in connection with the Chapter 11 Cases.

Dated: May 22, 2020

MORRIS, NICHOLS, ARSHT & TUNNELL LLP

/s/ Derek C. Abbott_____________________ Derek C. Abbott (No. 3376) Matthew O. Talmo (No. 6333) Andrew R. Workman (No. 6710) 1201 N. Market Street, 16th Floor P.O. Box 1347 Wilmington, Delaware 19899-1347 Telephone: (302) 658-9200 Facsimile: (302) 658-3989 [email protected] [email protected] [email protected] Proposed Counsel to the Debtors and Debtors in Possession


EXHIBIT D

Zorda Declaration




Debtors.1


DECLARATION OF JOSEPH ZORDA, CHIEF FINANCIAL OFFICER

IN SUPPORT OF THE DEBTORS’ APPLICATION FOR ENTRY OF AN ORDER UNDER SECTIONS 327(a), 328(a), AND 1107(b) OF THE

BANKRUPTCY CODE, BANKRUPTCY RULES 2014 AND 2016, AND LOCAL RULES 2014-1 AND 2016-1 AUTHORIZING RETENTION AND EMPLOYMENT

OF MORRIS, NICHOLS, ARSHT & TUNNELL LLP AS BANKRUPTCY COUNSEL FOR THE DEBTORS NUNC PRO TUNC TO THE PETITION DATE

I, Joseph Zorda, Chief Financial Officer of the above-caption debtors and debtors in

possession, hereby declare the following under penalty of perjury:

1. I submit this declaration (the “Declaration”) in support of the Debtors’

Application for Entry of an Order Under Sections 327(a), 328(a) and 1107(b), Fed. R. Bankr. P.

2014 and 2016, and Del. Bankr. L.R. 2014-1 and 2016-1 Authorizing Retention and Employment

of Morris, Nichols, Arsht & Tunnell LLP as Bankruptcy Counsel for the Debtors, Nunc Pro Tunc

to the Petition Date (the “Application”).2 Except as otherwise noted, all facts in this Declaration

are based on my personal knowledge of the matters set forth herein, information gathered from

my review of relevant documents, and information supplied to me by other members of the

Debtors’ management and the Debtors’ advisors.



2 Capitalized terms not defined in this declaration are defined in the Application.


3

THE DEBTORS’ SELECTION OF COUNSEL

2. The Debtors recognize that a comprehensive review process is necessary when

selecting and managing chapter 11 counsel to ensure that bankruptcy professionals are subject to

the same client-driven market forces, scrutiny, and accountability as professionals in non-

bankruptcy engagements.

3. To that end, the review process utilized by the Debtors here assessed potential

counsel based on their expertise in the relevant legal issues and in similar proceedings. Morris

Nichols has extensive experience representing debtors in chapter 11 cases before this Court.

4. In addition, Morris Nichols has become familiar with the Debtors’ business, debt

structure, and many of the legal issues that may arise in the context of the Chapter 11 Cases

through preparing the Chapter 11 Cases for filing. I believe that for those reasons, Morris

Nichols is both well qualified and uniquely able to represent the Debtors in the Chapter 11 Cases

in an efficient and timely manner. Thus, the Debtors decided to continue to retain Morris

Nichols as the Debtors’ bankruptcy counsel during the Chapter 11 Cases.

RATE STRUCTURE

5. In my capacity as Chief Financial Officer, I am responsible for supervising

outside counsel retained by the Debtors in the ordinary course of business. Morris Nichols has

informed the Debtors that its rates for bankruptcy representations are comparable to the rates it

charges for non-bankruptcy representations. As discussed below, I am also responsible for

reviewing the invoices regularly submitted by Morris Nichols, and, based upon the Engagement

Agreement, the rates Morris Nichols charged the Debtors in the prepetition period are the same

as the regular, annually-adjusted rates Morris Nichols will charge the Debtors in the postpetition

period.


4

COST SUPERVISION

6. The Debtors recognize that they have the responsibility to closely monitor the

billing practices of their counsel to ensure the fees and expenses paid by the estates remain

consistent with the Debtors’ expectations and the exigencies of the Chapter 11 Cases. As they

did prepetition, the Debtors will continue to bring discipline, predictability, client involvement,

and accountability to the counsel fees and expenses reimbursement process. To that end, the

Debtors will review and monitor the invoices that Morris Nichols submits.

Dated: May 22, 2020

/s/ Joseph Zorda Joseph Zorda Chief Financial Officer


in the united states bankruptcy court for …...1107(b), as supplemented by bankruptcy rules 2014(a)...

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