in the united states bankruptcy court for the … · to the fullest extent permitted by applicable...

61976515.5

IN THE UNITED STATES BANKRUPTCY COURTFOR THE DISTRICT OF DELAWARE

In re:

ENSEQUENCE, INC.,1

Debtor.

Chapter 11

Case No. 18-10182 (KG)

DEBTOR’S APPLICATION FOR ENTRY OF AN ORDER (I) APPROVING THERETENTION AND EMPLOYMENT OF RUST CONSULTING/OMNI BANKRUPTCYAS THE ADMINISTRATIVE AGENT FOR THE DEBTOR, EFFECTIVE NUNC PRO

TUNC TO THE PETITION DATE, AND (II) GRANTING RELATED RELIEF

The above-captioned debtor and debtor-in-possession (the “Debtor”) hereby applies

(this “Application”) for entry of an order, substantially in the form attached hereto as Exhibit A

(the “Order”), approving the services agreement (the “Services Agreement”) between the

Debtor and Rust Consulting/Omni Bankruptcy (“Rust Omni”) and the Debtor’s retention and

employment of Rust Omni as administrative agent (the “Administrative Agent”) for the Debtor

in lieu of the Clerk (the “Clerk”) of the United States Bankruptcy Court for the District of

Delaware (the “Court”) and for related relief, effective nunc pro tunc to January 30, 2018 (the

“Petition Date”). In support of this Application, the Debtor relies on the declaration of Paul H.

Deutch (the “Deutch Declaration”), attached hereto as Exhibit B and incorporated herein by

reference. In further support of the Application, the Debtor respectfully states as follows.2

Jurisdiction and Venue

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

1334 and the Amended Standing Order of Reference from the United States District Court for the

1 The Debtor’s last four digits of its U.S. federal tax identification number are 6904. The address for the Debtor’sheadquarters is 420 Lexington Ave., Suite 408, New York, NY 10170.

2 The Declaration of Michael Wyse in Support of Chapter 11 Petition and First Day Pleadings was filed with theCourt concurrently herewith (the “First Day Declaration”) and is incorporated by reference herein.

Case 18-10182-KG Doc 14 Filed 01/30/18 of 9

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District of Delaware, dated February 29, 2012. This is a core proceeding within the meaning of

28 U.S.C. § 157(b). The Debtor confirms its consent, pursuant to Rule 9013-1(f) of the Local

Rules for the United States Bankruptcy Court for the District of Delaware (the “Local Rules”),

to the entry of a final order to the extent it is later determined that the Court, absent the consent

of the parties, cannot enter final orders or judgments consistent with Article III of the United

States Constitution.

2. Venue of this case and this Motion in this district is proper under 28 U.S.C. §§

1408 and 1409.

3. The statutory bases for the relief requested herein are sections 327(a) of title 11 of

the United States Code (the “Bankruptcy Code”), Rule 2014(a) of the Federal Rules of

Bankruptcy Procedure (the “Bankruptcy Rules”), and Local Rule 2014-1.

Background

4. On January 30, 2018 (the “Petition Date”), the Debtor filed a voluntary petition

in this Court commencing a case for relief under chapter 11 of the Bankruptcy Code (the

“Chapter 11 Case”).

5. The Debtor continues to manage and operate its business as a debtor-in-

possession pursuant to Bankruptcy Code sections 1107 and 1108.

6. No trustee, examiner or committee has been appointed in this Chapter 11 Case.

7. The factual background regarding the Debtor, including its business operations,

its capital and debt structures, and the events leading to the filing of this Chapter 11 Case, is set

forth in detail in the First Day Declaration and fully incorporated herein by reference.


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Relief Requested

8. The Debtor seeks entry of the Order approving the Services Agreement and the

Debtor’s retention of Rust Omni as Administrative Agent for the Debtor in the Chapter 11 Case

pursuant to the Services Agreement, which is attached hereto as Exhibit C and incorporated

herein by reference, effective nunc pro tunc to the Petition Date.

9. This Application supplements the Debtor’s application under 28 U.S.C. § 156(c)

(the “Section 156(c) Application”) filed contemporaneously herewith to retain Rust Omni to

serve as the claims and noticing agent in the Chapter 11 Case, and seeks approval for Rust Omni

to perform duties outside of the scope of 28 U.S.C. § 156(c).

Services to Be Provided

10. The Debtor seeks to retain Rust Omni to provide, among other things, the

following bankruptcy administrative services (the “Administrative Services”), if and to the

extent the Debtor requests:

a. assisting with the preparation and filing of the Debtor’s schedules of assetsand liabilities and statements of financial affairs;

b. recording all transfers of claims and providing any notices of suchtransfers as required by Bankruptcy Rule 3001(e); provided, however, thatif any evidence of transfer of claim(s) is filed with the Court pursuant toBankruptcy Rule 3001(e), and if the evidence of transfer or notice thereofexecuted by the parties purports to waive the 21-day notice and objectionperiod required under Bankruptcy Rule 3001(e), then the AdministrativeAgent may process the transfer of claim(s) to change the name and addressof the claimant of such claim to reflect the transfer, and the effective dateof such transfer will be the date the evidence of such transfer wasdocketed in the Chapter 11 Case;

c. generating and providing claim reports and claim objection exhibits;

d. managing the preparation, compilation and mailing of documents tocreditors and other parties in interest in connection with the solicitation ofa chapter 11 plan (a “Plan”);

e. managing any rights offering pursuant to a Plan;

f. managing the publication of legal notices;


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g. collecting and tabulating votes in connection with any Plan filed by theDebtor and providing ballot reports to the Debtor and its professionals;

h. generating an official ballot certification and testifying, if necessary, insupport of the ballot tabulation results;

i. managing any distributions made pursuant to a Plan; and

j. providing any and all necessary administrative tasks not otherwisespecifically set forth above as the Debtor or its professionals may requirein connection with this Chapter 11 Case.

11. Rust Omni’s appointment as Administrative Agent will provide the Debtor with

experienced professionals and services that are essential to a successful reorganization. Rust

Omni will coordinate with the Debtor’s other retained professionals in the Chapter 11 Case to

avoid any unnecessary duplication of services. Accordingly, the relief requested in this Section

327 Application is in the best interest of the Debtor’s estate and all parties in interest.

Rust Omni’s Qualifications

12. Rust Omni is a bankruptcy administrator specializing in claims management and

legal administration services. Rust Omni provides comprehensive chapter 11 services, including

noticing, claims processing, balloting, and other related services critical to the effective

administration of chapter 11 cases.

13. Rust Omni’s substantial experience in matters of this size and complexity has

included: In re Charming Charlie Holdings Inc., Case No. 17-12906 (CSS) (Bankr. D. Del. Dec.

13, 2017); In re Answers Holdings, Inc., Case No. 17-10496 (SMB) (Bankr. S.D.N.Y. Mar. 10,

2017); In re Memorial Production Partners LP, Case No. 17-30262 (MI) (Bankr. S.D. Tex. Jan.

16, 2017); In re ITT Educational Services, Inc., Case No. 16-07207 (JMC) (Bankr. S.D. Ind.

Sept. 16, 2016); In re Joyce Leslie, Inc., Case No. 16-22035 (RDD) (Bankr. S.D.N.Y. Jan. 9,

2016); In re Phoenix Brands, LLC, Case No. 16-11242 (BLS) (Bankr. D. Del. May 24, 2016); In

re Mission Group Kansas, Case No. 16-20656 (RDB) (Bankr. D. Kan. April 15, 2016); In re


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Affirmative Insurance Holdings, Inc., Case No. 15-12136 (Bankr. D. Del. Nov. 16, 2015); In re

Karmaloop, Inc., Case No. 15-10635 (Bankr. D. Del. Mar. 25, 2015); In re Phoenix Payment

Systems., Case No. 14-11848 (Bankr. D. Del. Aug. 4, 2014); In re Gridway Energy Holdings,

Case No. 14-10833 (Bankr. D. Del. Apr. 10, 2014); In re Restora Healthcare Holdings, LLC,

Case No. 14-10367 (Bankr. D. Del. Feb. 24, 2014); In re First Mariner Bancorp, Case No. 14-

11952 (Bankr. D. Md. Feb. 10, 2014); In re HDOS Enters., Case No. 14-12028 (Bankr. C.D. Cal.

Feb. 3, 2014); In re FAH Liquidating Corp., Case No. 13-13087 (Bankr. D. Del. Nov. 22, 2013);

In re SGK Ventures, LLC, Case No. 13-37603 (Bankr. N.D. Ill. Sep. 24, 2013).

14. Based on Rust Omni’s experience, the Debtor believes that Rust Omni is well-

qualified to serve as the Administrative Agent in this Chapter 11 Case. Additionally, the Debtor

believes Rust Omni’s rates are reasonable and competitive given its quality of service and

expertise.

15. By appointing Rust Omni as the Administrative Agent in this Chapter 11 Case,

the distribution of notices and the processing of claims will be expedited, and the Clerk’s office

will be relieved of the administrative burden of processing such claims. In support of this

Application, the Debtor submits the Deutch Declaration, attached hereto as Exhibit B.

Indemnification Provisions

16. As part of the overall compensation payable to Rust Omni under the terms of the

Services Agreement, the Debtor has agreed to certain indemnification obligations as specifically

enumerated in the Services Agreement. The Services Agreement contains the standard

indemnification language with respect to Rust Omni’s services including, but not limited to, the

following:

To the fullest extent permitted by applicable law, the Company shall indemnifyand hold harmless Rust Omni and its members, directors, officers, employees,


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representatives, affiliates, consultants, subcontractors and agents (collectively, the“Indemnified Parties”) from and against any and all losses, claims, damages,judgments, liabilities and expenses, whether direct or indirect (including, withoutlimitation, counsel fees and expenses) (collectively, “Losses”) resulting from,arising out of or related to Rust Omni’s performance hereunder. Without limitingthe generality of the foregoing, Losses include any liabilities resulting fromclaims by any third parties against any Indemnified Parties. Rust Omni and theCompany shall notify each other in writing promptly upon the assertion, threat orcommencement of any claim, action, investigation or proceeding that either partybecomes aware of with respect to the services provided under and pursuant to theAgreement. The Company’s indemnification of Rust Omni hereunder shallexclude Losses resulting from Rust Omni’s gross negligence or willfulmisconduct. The Company’s indemnification obligations hereunder shall survivethe termination of this Agreement.

17. The Debtor and Rust Omni believe that the indemnification provisions contained

in the Services Agreement are customary and reasonable for Rust Omni and comparable firms

providing administrative agent services.

Compensation and Representation of Disinterestedness

18. The fees Rust Omni will charge in connection with its services to the Debtor are

set forth in the Services Agreement. Rust Omni’s rates are competitive and comparable to the

rates Rust Omni’s competitors charge for similar services and are reasonable given the quality of

Rust Omni’s services and Rust Omni’s bankruptcy expertise. Additionally, Rust Omni will seek

reimbursement from the Debtor for reasonable expenses in accordance with the terms of the

Services Agreement.

19. Rust Omni intends to apply to the Court for allowance of compensation and

reimbursement of out-of-pocket expenses incurred after the Petition Date in connection with the

services it provides, pursuant to this Application, as the Administrative Agent in the Chapter 11

Case, subject to Court approval and in accordance with the applicable provisions of the

Bankruptcy Code, the Bankruptcy Rules, the Local Rules, the guidelines established by the

United States Trustee for the District of Delaware, and further orders of the Court.


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20. The Deutch Declaration represents that Rust Omni is not connected with the

Debtor, its creditors, the United States Trustee, or any person employed by the Office of the

United States Trustee, and that, to the best of Rust Omni’s knowledge, after due inquiry, Rust

Omni does not by reason of any direct or indirect relationship to, connection with, or interest in

the Debtor, hold or represent any interest adverse to the Debtor, its estate, or any class of

creditors or equity interest holders with respect to the matters upon which it is to be engaged.

Based upon the Deutch Declaration, Rust Omni is a “disinterested person,” as that term is

defined in Bankruptcy Code section 101(14).

Basis for Relief

21. Bankruptcy Code section 327(a) provides that a debtor, subject to Court approval:

[M]ay employ one or more attorneys, accountants, appraisers,auctioneers, or other professional persons, that do not hold orrepresent an interest adverse to the estate, and that aredisinterested persons, to represent or assist the [debtor] in carryingout the [debtor]’s duties under this title.

11 U.S.C. § 327(a).

22. Bankruptcy Rule 2014(a) requires that an application for retention include:

[S]pecific facts showing the necessity for the employment, thename of the [firm] to be employed, the reasons for the selection,the professional services to be rendered, and proposed arrangementfor compensation, and, to the best of the applicant’s knowledge, allof the [firm’s] connections with the debtor, creditors, any otherparty in interest, their respective attorneys and accountants, theUnited States trustee, or any person employed in the office of theUnited States trustee.

Fed. R. Bankr. P. 2014.

23. Additionally, Local Rule 2014-1 requires an entity seeking approval of

employment under Bankruptcy Code section 327(a) to file a motion, supporting affidavit, and

proposed order, all of which have been satisfied by this Application, the Deutch Declaration


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attached hereto as Exhibit B, and the proposed Order attached hereto as Exhibit A. Further, in

accordance with Local Rule 2014-1, Rust Omni acknowledges its continuing duty to supplement

the Deutch Declaration with additional material information relating to the employment of Rust

Omni, if necessary.

24. To help manage administrative tasks with respect to the hundreds of creditors,

equity security holders, and other parties in interest that are expected to be involved in the

Debtor’s Chapter 11 Case, and for reasons previously stated, the Debtor submits that Rust

Omni’s employment is necessary and in the best interests of the Debtor and its estate.

Additionally, as described in the Deutch Declaration, Rust Omni is disinterested. Accordingly,

the Debtor submits that Court approval of Rust Omni as the Administrative Agent in the Chapter

11 Case pursuant to Bankruptcy Code section 327(a), Bankruptcy Rule 2014, and Local Rule

2014-1 is warranted.

Waiver of Bankruptcy Rule 6004(a) and 6004(h)

25. To implement the foregoing successfully, the Debtor seeks a waiver of the notice

requirements under Bankruptcy Rule 6004(a) and the 14-day stay of an order authorizing the use,

sale, or lease of property under Bankruptcy Rule 6004(h).

Notice

26. Notice of this Motion has been given to (a) the Office of the United States Trustee

for Region 3, serving the District of Delaware; (b) the parties included on the Debtor’s list of

largest unsecured creditors; (c) the Debtor’s prepetition lender, (d) all parties who have filed a

notice of appearance and request for service of papers pursuant to Bankruptcy Rule 2002, and (e)

all parties required to be served by Local Rule 9013-l(m). In light of the nature of the relief

requested herein, the Debtor respectfully submits that no other or further notice need be given.


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No Prior Request

27. No prior request for the relief sought in this Application has been made to this or

any other court.

WHEREFORE, the Debtor respectfully requests that the Court enter the Order, granting

the relief requested herein and such other relief as the Court deems appropriate under the

circumstances.

Dated: January 30, 2018 /s/ Michael WyseNew York, New York Michael Wyse

Chief Restructuring Officer and Interim ChiefExecutive OfficerEnsequence, Inc.


61976515.5

EXHIBIT A

Proposed Order

Case 18-10182-KG Doc 14-1 Filed 01/30/18 Page 1 of 5

61976515.5


In re:

ENSEQUENCE, INC.,1

Debtor.

Chapter 11

Case No. 18-10182 (KG)

Re: Docket No. __

ORDER (I) APPROVING THE RETENTION AND EMPLOYMENT OF RUSTCONSULTING/OMNI BANKRUPTCY AS THE ADMINISTRATIVE AGENT FOR THE

DEBTOR, EFFECTIVE NUNC PRO TUNC TO THE PETITION DATE, AND(II) GRANTING RELATED RELIEF

Upon the application (the “Application”) of the above-captioned debtor and debtor-in-

possession (the “Debtor”) for entry of an order (this “Order”) pursuant to Bankruptcy Code

section 327(a),2 Bankruptcy Rule 2014, and Local Rule 2014-1, approving the retention of Rust

Consulting/Omni Bankruptcy (“Rust Omni”) as the Administrative Agent in the Chapter 11

Case, effective nunc pro tunc to the Petition Date, on the terms and conditions set forth in the

Services Agreement, all as more fully set forth in the Application; and upon the First Day

Declaration; and upon the Deutch Declaration; and this Court having jurisdiction over this matter

pursuant to 28 U.S.C. §§ 157 and 1334 and the Amended Standing Order of Reference from the

United States District Court for the District of Delaware, dated February 29, 2012; and this Court

having found that this is a core proceeding pursuant to 28 U.S.C. § 157(b)(2) and that this Court

may enter a final order consistent with Article III of the United States Constitution; and this

Court having found that venue of this proceeding and the Application in this district is proper

pursuant to 28 U.S.C. §§ 1408 and 1409; and this Court having found that the relief requested in


2 Capitalized terms used but not otherwise defined herein have the meanings ascribed to them in the Application.


261976515.5

the Application is in the best interests of the Debtor’s estate, its creditors, and other parties in

interest; and this Court having found that the Debtor’s notice of the Application and opportunity

for a hearing on the Application were appropriate under the circumstances and that no other

notice need be provided; and this Court having reviewed the Application and having heard the

statements in support of the relief requested therein at a hearing before this Court

(the “Hearing”); and this Court having determined that the legal and factual bases set forth in the

Application and at the Hearing establish just cause for the relief granted herein; and upon all of

the proceedings had before this Court; 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 Debtor is authorized to retain Rust Omni as the Administrative Agent in

accordance with the terms and conditions set forth in the Application and the Services

Agreement, effective nunc pro tunc to the Petition Date.

3. Rust Omni shall apply to this Court for allowance of compensation and

reimbursement of out-of-pocket expenses incurred in the Chapter 11 Case under the Application

after the Petition Date in accordance with the applicable provisions of the Bankruptcy Code, the

Bankruptcy Rules, the Local Rules, the guidelines established by the United States Trustee for

the District of Delaware, and further orders of this Court.

4. The indemnification provisions of the Services Agreement are approved, subject

to the following clarifications:

a. Subject to the provisions of subparagraphs (c) and (d) below, the Debtor isauthorized to indemnify, and shall indemnify, Rust Omni in accordancewith the Services Agreement and to the extent permitted by applicablelaw, for any claim arising from, related to, or in connection with RustOmni’s performance of the services described in the Services Agreement;


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b. Rust Omni shall not be entitled to indemnification, contribution, orreimbursement for services other than the services provided under theServices Agreement, unless such services and the indemnification,contribution, or reimbursement therefore are approved by the Court;

c. Notwithstanding anything to the contrary in the Services Agreement, theDebtor shall have no obligation to indemnify any person, or providecontribution or reimbursement to any person, for any claim or expense tothe extent that it is either (i) judicially determined (the determinationhaving become final and no longer subject to appeal) to have arisen fromthat person’s gross negligence or willful misconduct; (ii) for a contractualdispute in which the Debtor alleges the breach of Rust Omni’s contractualobligations unless the Court determines that indemnification, contribution,or reimbursement would be permissible pursuant to In re United ArtistsTheatre Co., 315 F.3d 217 (3d Cir. 2003); or (iii) settled prior to a judicialdetermination as to the exclusions set forth in clauses (i) and (ii), butdetermined by this Court, after notice and a hearing, to be a claim orexpense for which that person should not receive indemnity, contribution,or reimbursement under the terms of the Services Agreement as modifiedby this Order; and

d. If, before the earlier of (i) the entry of an order confirming a chapter 11plan in the Chapter 11 Case (that order having become a final order nolonger subject to appeal) and (ii) the entry of an order closing the Chapter11 Case, Rust Omni believes that it is entitled to the payment of anyamounts by the Debtor on account of the Debtor’s indemnification,contribution, or reimbursement obligations under the Services Agreement,including without limitation the advancement of defense costs, Rust Omnimust file an application before this Court, and the Debtor may not pay anysuch amounts to Rust Omni before the entry of an order by this Courtapproving the payment. This subparagraph (d) is intended only to specifythe period of time under which the Court shall have jurisdiction over anyrequest for payment by Rust Omni for indemnification, contribution, orreimbursement, and not a provision limiting the duration of the Debtor’sobligation to indemnify Rust Omni.

5. Notwithstanding any term in the Services Agreement to the contrary, the Court

retains jurisdiction with respect to all matters arising from or related to the implementation of

this Order during the pendency of the Chapter 11 Case.

6. The Debtor is authorized to take all actions necessary to effectuate the relief

granted in this Order in accordance with the Application.


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7. In the event of any inconsistency between the Services Agreement, the

Application, and this Order, this Order shall govern.

8. Notice of the Application as provided therein shall be deemed good and sufficient

notice of such Application and the requirements of Bankruptcy Rule 6004(a) and the Local Rules

are satisfied by such notice.

9. Notwithstanding Bankruptcy Rule 6004(h), the terms and conditions of this Order

are immediately effective and enforceable upon its entry.

10. Notwithstanding anything to the contrary contained herein, any payment to be

made, or authorization contained hereunder, shall be subject to any budget and cash collateral

authorization set forth in any cash collateral order approved by the Court.

11. The Debtor is authorized to take all actions necessary to effectuate the relief

granted in this Order in accordance with the Application.

12. This Court retains exclusive jurisdiction with respect to all matters arising from or

related to the implementation, interpretation, and enforcement of this Order.

Dated: ______ ___, 2018Wilmington, Delaware

THE HONORABLE KEVIN GROSSUNITED STATES BANKRUPTCY JUDGE


61976515.5

EXHIBIT B

Deutch Declaration


61976515.5


In re:

ENSEQUENCE, INC.,1

Debtor.

Chapter 11

Case No. 18-10182 (KG)

DECLARATION OF PAUL H. DEUTCH IN SUPPORT OF DEBTOR’S APPLICATIONFOR ENTRY OF AN ORDER (I) APPROVING THE RETENTION AND

EMPLOYMENT OF RUST CONSULTING/OMNI BANKRUPTCY AS THEADMINISTRATIVE AGENT FOR THE DEBTOR, EFFECTIVE NUNC PRO TUNC TO

THE PETITION DATE, AND (II) GRANTING RELATED RELIEF

I, Paul H. Deutch, declare, under penalty of perjury, as follows:

1. I am the Executive Managing Director of Rust Consulting/Omni Bankruptcy

(“Rust Omni”), an administrative services firm that specializes in the administration of large

bankruptcy cases. Except as otherwise noted, I have personal knowledge of the matters set forth

herein, and if called and sworn as a witness, I could and would testify competently thereto.

2. This declaration is made in support of the Debtor’s Application for Entry of an

Order (i) Approving the Retention and Employment of Rust Consulting/Omni Bankruptcy as the

Administrative Agent for the Debtor, Effective Nunc Pro Tunc to the Petition Date, and (II)

Granting Related Relief which was filed contemporaneously herewith (the “Application”).

3. This declaration is submitted in support of the Application pursuant to

Bankruptcy Code section 327(a) and Bankruptcy Rule 2014(a) to employ and retain Rust Omni

as administrative agent (“Administrative Agent”) in connection with the above-captioned

chapter 11 case (the “Chapter 11 Case”) and in accordance with the terms and conditions of the



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Services Agreement by and between the Debtor and Rust Omni (the “Services Agreement”), a

true and correct copy of which is attached as Exhibit C to the Application.

4. Rust Omni is an industry leader whose professionals have significant experience

in both the legal and administrative aspects of large, complex chapter 11 cases. Rust Omni’s

professionals have experience in noticing, claims administration, solicitation, balloting, and

facilitating other administrative aspects of chapter 11 cases, including in matters of this size and

complexity. Rust Omni’s professionals have acted as official claims and noticing agent in many

large bankruptcy cases in this district and in other districts nationwide, including: In re

Charming Charlie Holdings Inc., Case No. 17-12906 (CSS) (Bankr. D. Del. Dec. 13, 2017); In

re Answers Holdings, Inc., Case No. 17-10496 (SMB) (Bankr. S.D.N.Y. Mar. 10, 2017); In re

Memorial Production Partners LP, Case No. 17-30262 (MI) (Bankr. S.D. Tex. Jan. 16, 2017); In

re ITT Educational Services, Inc., Case No. 16-07207 (JMC) (Bankr. S.D. Ind. Sept. 16, 2016);

In re Joyce Leslie, Inc., Case No. 16-22035 (RDD) (Bankr. S.D.N.Y. Jan. 9, 2016); In re

Phoenix Brands, LLC, Case No. 16-11242 (BLS) (Bankr. D. Del. May 24, 2016); In re Mission

Group Kansas, Case No. 16-20656 (RDB) (Bankr. D. Kan. April 15, 2016); In re Affirmative

Insurance Holdings, Inc., Case No. 15-12136 (Bankr. D. Del. Nov. 16, 2015); In re Karmaloop,

Inc., Case No. 15-10635 (Bankr. D. Del. Mar. 25, 2015); In re Phoenix Payment Systems., Case

No. 14-11848 (Bankr. D. Del. Aug. 4, 2014); In re Gridway Energy Holdings, Case No. 14-

10833 (Bankr. D. Del. Apr. 10, 2014); In re Restora Healthcare Holdings, LLC, Case No. 14-

10367 (Bankr. D. Del. Feb. 24, 2014); In re First Mariner Bancorp, Case No. 14-11952 (Bankr.

D. Md. Feb. 10, 2014); In re HDOS Enters., Case No. 14-12028 (Bankr. C.D. Cal. Feb. 3, 2014);

In re FAH Liquidating Corp., Case No. 13-13087 (Bankr. D. Del. Nov. 22, 2013); In re SGK

Ventures, LLC, Case No. 13-37603 (Bankr. N.D. Ill. Sep. 24, 2013).


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5. The Debtor selected Rust Omni to serve as the Administrative Agent for the

Debtor’s estate, as set forth in more detail in the Application filed contemporaneously herewith.

To the best of my knowledge, and based upon information provided to me by the Debtor, and

except as provided herein, neither Rust Omni, nor any employee thereof, has any materially

adverse connection to the Debtor, its creditors or other relevant parties. Rust Omni may have

relationships with certain of the Debtor’s creditors as vendors or in connection with cases in

which Rust Omni serves or has served in a neutral capacity as noticing, claims, balloting and/or

administrative agent for another chapter 11 debtor. In addition, Rust Omni’s personnel may have

relationships with some of the Debtor’s creditors or other parties in interest. However, to the best

of my knowledge, such relationships, to the extent they exist, are of a personal nature and

completely unrelated to the Chapter 11 Case.

6. Rust Omni has and will continue to represent clients in matters unrelated to the

Chapter 11 Case. In addition, Rust Omni has had and will continue to have relationships in the

ordinary course of its business with certain vendors, professionals and other parties in interest

that may be involved in the Chapter 11 Case in matters unrelated to the Chapter 11 Case. Rust

Omni may also provide professional services to entities or persons that may be creditors or

parties in interest in the Chapter 11 Case, which services do not directly relate to, or have any

direct connection with, the Chapter 11 Case or the Debtor.

7. Rust Omni has reviewed its electronic database to determine whether it has any

relationships with the potential parties in interest, whose names were provided to Rust Omni by

the Debtor. At this time, I am not aware of any relationship that would present a disqualifying

conflict of interest. Should Rust Omni discover any new relevant facts or relationships bearing


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on the matters described herein during the period of its retention, Rust Omni will use reasonable

efforts to file promptly a supplemental affidavit.

8. To the best of my knowledge, neither Rust Omni nor any employee thereof has

any affiliation with the Debtor, its creditors, other parties in interest, the United States Trustee or

any other person employed by the Office of the United States Trustee. To the best of my

knowledge, neither Rust Omni nor any other employee thereof holds any interest adverse to the

Debtor’s estate with respect to the matters upon which it is to be engaged. Based on the

foregoing, I believe that Rust Omni is a “disinterested person” as that term is defined in

Bankruptcy Code section 101(14).

9. Rust Omni shares a corporate parent with certain companies that provide

integrated technology products and services to the legal profession for electronic discovery, class

action settlements, financial transactions, chapter 7 and 13 bankruptcy, litigation and regulatory

compliance. Given the legal and operational separateness of Rust Omni from its affiliates and the

administrative nature of the services performed by such companies, Rust Omni does not believe

that a conflict would arise solely from any relationship or claim of an affiliate or its corporate

parent.

10. In performing the services described in the Application, Rust Omni will charge

the rates set forth on the fee schedule in the Services Agreement. These rates are at least as

favorable as the prices Rust Omni charges in cases in which the firm has been retained to

perform similar services.

11. Subject to the Court’s approval, the Debtor has agreed to compensate Rust Omni

for professional services rendered pursuant to Bankruptcy Code section 327(a) in connection with

the Chapter 11 Case according to the terms and conditions of the Services Agreement.


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12. To the extent that Rust Omni’s duties exceed the scope of those set forth in the

Section 156(c) Order and application, Rust Omni intends to apply to the Court for allowance of

compensation and reimbursement of reasonable and necessary out-of-pocket expenses incurred

on and after January 30, 2018 in accordance with the Fee Guidelines (as defined in the

Application).

13. Rust Omni represents, among other things, that:

(a) it will not consider itself employed by the United States government andwill not seek any compensation from the United States government in itscapacity as Administrative Agent;

(b) by accepting employment in the Chapter 11 Case, Rust Omni waives anyright to receive compensation from the United States government;

(c) in its capacity as Administrative Agent, Rust Omni will not be an agent ofthe United States and will not act on behalf of the United States; and

(d) Rust Omni will not employ any past or present employees of the Debtor inconnection with its work as Administrative Agent.

Pursuant to 28 U.S.C. § 1746, I declare under penalty of perjury that, to the best of my

knowledge and after reasonable inquiry, the foregoing is true and correct.

Executed on January 30, 2018

/s/ Paul H. DeutchPaul H. DeutchExecutive Managing Director


61976515.5

EXHIBIT C

Services Agreement


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