Contract analysis

I. Findings of Good Cause. Good cause has been shown for entry of this Interim Order pursuant to Bankruptcy Rules 4001(b)(2) and 4001(c)(2). The Court finds that: (i) The Debtors were unable to obtain sufficient unsecured credit allowable as an administrative expense under section 503(b)(1) of the Bankruptcy Code, or credit or indebtedness under section 364(c) of the Bankruptcy Code alone, on terms reasonably accepta

I. AUTHORIZATION OF INTERIM DIP BORROWING A. Authorization. The Debtors are hereby authorized and empowered, pursuant to sections 105, 361, 362, 364(c)(1), 364(c)(2), 364(c)(3), and 364(d)(1) of the Bankruptcy Code, to borrow up to $18,000,000 in aggregate principal amount (the "Interim DIP Loan") under the New Money DIP Tranche of the DIP Credit Agreement from the DIP Lender on an interim basis, subject to and in ac

II. SUPERPRIORITY ADMINISTRATIVE EXPENSE CLAIMS A. DIP Superpriority Claims. Pursuant to section 364(c)(1) of the Bankruptcy Code, all obligations of the Debtors arising under the DIP Facility, the DIP Credit Agreement, and the DIP Documents, including all principal, interest (including default interest), fees (including the commitment fee, exit fee, and unused line fee), costs, expenses, indemnification obligations,

III. INTERIM PRIMING LIENS A. Grant of DIP Liens. Pursuant to sections 364(c)(2), 364(c)(3), and 364(d)(1) of the Bankruptcy Code, as security for the DIP Obligations, the DIP Lender is hereby granted, effective as of the date of this Interim Order and on an interim basis, valid, binding, continuing, enforceable, fully perfected, first priority senior priming liens on, and security interests in, substantially all ass

IV. ADEQUATE PROTECTION FOR PRE-PETITION SECURED LENDERS A. Adequate Protection for Pre-Petition First Lien Lenders. As adequate protection for the priming of the Pre-Petition First Lien Lenders' liens on the DIP Collateral pursuant to section 364(d)(1) of the Bankruptcy Code, and for any diminution in the value of the Pre-Petition First Lien Lenders' interests in the Pre-Petition Collateral (as defined in the Pre-Pe

1. Replacement Liens. Pursuant to sections 361(2) and 363(e) of the Bankruptcy Code, the Pre-Petition First Lien Lenders are hereby granted valid, binding, continuing, enforceable, and automatically perfected replacement liens on, and security interests in, the DIP Collateral (the "Replacement Liens"). The Replacement Liens shall secure all pre-petition obligations of the Debtors under the Pre-Petition First Lien Fac

2. Section 507(b) Superpriority Claims. Pursuant to section 507(b) of the Bankruptcy Code, the Pre-Petition First Lien Lenders are hereby granted allowed superpriority administrative expense claims against each of the Debtors and their respective estates (the "Adequate Protection Superpriority Claims"), to the extent that the adequate protection provided herein proves to be insufficient to compensate for any diminuti

3. Adequate Protection Payments. The Debtors shall make monthly cash payments of current-pay interest on the outstanding aggregate principal amount of the Pre-Petition First Lien Facility held by the Pre-Petition First Lien Lenders other than Driftwood (i.e., on an outstanding aggregate principal amount of $88,000,000) at the non-default contractual interest rate of Adjusted Term SOFR plus 425 basis points per annum.

4. Adequate Protection Reserve. The sum of $3,500,000 from the proceeds of Draw 1 of the Interim DIP Loan shall be deposited into a segregated, interest-bearing reserve account (the "Adequate Protection Reserve") for the benefit of the Pre-Petition First Lien Lenders (other than Driftwood), to be held and maintained by the Pre-Petition Agent or as otherwise agreed among the Debtors, the DIP Lender, and the Pre-Petiti

5. Payment of Ad Hoc Group Counsel Fees. As additional adequate protection, the Debtors shall reimburse the reasonable and documented fees and out-of-pocket expenses of Hartwell & Crane LLP, counsel to the Ad Hoc Group of First Lien Lenders (consisting of Velthorn National Bank, N.A. and Pinnacle Credit Partners Fund II, LP, which together hold $66,000,000 in aggregate principal amount, representing 55.0% of the tota

V. CARVE-OUT A. Definition and Amount. As used in this Interim Order, the term "Carve-Out" shall mean and consist of the following: (i) All fees required to be paid to the Clerk of the United States Bankruptcy Court for the District of Delaware and to the Office of the United States Trustee under 28 U.S.C. § 1930(a), together with interest thereon as required under 31 U.S.C. § 3717, in an aggregate amount not to exce

VI. MODIFICATION OF THE AUTOMATIC STAY The automatic stay imposed under section 362 of the Bankruptcy Code is hereby modified, on an interim basis, to the extent necessary to permit the following: (i) The DIP Lender to exercise all rights and remedies available to it under the DIP Credit Agreement, the DIP Documents, this Interim Order, and applicable non-bankruptcy law upon the occurrence and during the continuance

VII. EVENTS OF DEFAULT AND REMEDIES The Events of Default under the DIP Credit Agreement are hereby acknowledged and incorporated herein by reference, and include, without limitation, the following: (i) Failure by the Debtors to comply with any Milestone set forth in the DIP Credit Agreement within the time period specified therein (as may be extended with the prior written consent of the DIP Lender); (ii) Variance f

VIII. LIMITATIONS ON USE OF DIP PROCEEDS AND CARVE-OUT Notwithstanding anything in this Interim Order, the DIP Credit Agreement, or any other order of this Court to the contrary, no proceeds of the DIP Facility, the Carve-Out, or any cash collateral of the Pre-Petition First Lien Lenders or the Pre-Petition Second Lien Noteholders may be used, directly or indirectly, to: (i) Object to, contest, challenge, or raise an

IX. RESERVATION OF RIGHTS REGARDING ROLL-UP AND CHALLENGE PERIOD The Roll-Up Tranche, in the aggregate principal amount of $32,000,000, which would convert Driftwood's pre-petition first lien claims under the Pre-Petition First Lien Facility into obligations under the DIP Facility on a dollar-for-dollar basis, is not authorized by this Interim Order. The Roll-Up Tranche shall not become effective, and Driftwood's pre

X. BINDING EFFECT; SUCCESSORS AND ASSIGNS This Interim Order shall be binding upon and shall inure to the benefit of the DIP Lender, the Debtors, the Pre-Petition Agent, the Pre-Petition First Lien Lenders, the Pre-Petition Second Lien Noteholders, Zynvaro Trust Company (in its capacity as Second Lien Indenture Trustee), any official committee appointed in these cases, all creditors of the Debtors, and all other part

XI. NO WAIVER OF PRE-PETITION LENDER RIGHTS Nothing in this Interim Order shall be deemed a waiver, release, relinquishment, or other modification of any rights, claims, defenses, setoff rights, or counterclaims of the Pre-Petition First Lien Lenders, the Pre-Petition Agent, the Pre-Petition Second Lien Noteholders, the Second Lien Indenture Trustee, or any other party in interest, whether arising under the Pre-Petit

XII. SECTION 506(c) WAIVER Subject to the entry of the Final DIP Order, no costs or expenses of administration of these Chapter 11 cases or any successor cases, including, without limitation, costs or expenses arising under section 506(c) of the Bankruptcy Code, shall be charged against or recovered from the DIP Lender, the DIP Collateral, or the Pre-Petition Collateral (as defined in the Pre-Petition First Lien Cred

XIII. SECTION 552(b) APPLICABILITY The DIP Lender and the Pre-Petition Secured Lenders (including the Pre-Petition First Lien Lenders and the Pre-Petition Second Lien Noteholders) shall be entitled to all of the rights and benefits of section 552(b) of the Bankruptcy Code with respect to the DIP Collateral and the Pre-Petition Collateral, as applicable. The "equities of the case" exception set forth in section 552(b)

XIV. GOOD FAITH UNDER SECTION 364(e) The Court finds and determines that the DIP Lender has extended credit to the Debtors under the DIP Facility and has acted in good faith in connection with the negotiation, documentation, and approval of the DIP Facility, the DIP Credit Agreement, and this Interim Order, within the meaning of section 364(e) of the Bankruptcy Code. The DIP Lender is entitled to all of the protectio

XV. NO MARSHALING; NO EQUITABLE SUBORDINATION The DIP Lender shall not be subject to the equitable doctrine of marshaling or any similar doctrine with respect to the DIP Collateral, the Pre-Petition Collateral, or any other assets of the Debtors' estates, and no party in interest shall assert or seek to apply any such doctrine against the DIP Lender. The DIP Liens, the DIP Superpriority Claims, and all other rights a

XVI. REPORTING OBLIGATIONS The Debtors shall comply with all reporting obligations set forth in the DIP Credit Agreement, including, without limitation, the following: (i) Delivery of updated 13-week rolling cash flow budgets (i.e., updated Approved Budgets) every four (4) weeks, in form and substance satisfactory to the DIP Lender; (ii) Delivery of variance reports comparing actual results to the Approved Budget, te

XVII. FINAL HEARING A. Scheduling. A final hearing on the DIP Motion (the "Final Hearing") shall be held on October 13, 2023, at 10:00 a.m. (Eastern Time) before the Honorable Karen F. McAllister, United States Bankruptcy Judge, in Courtroom No. 5 of the United States Bankruptcy Court for the District of Delaware, 824 North Market Street, Wilmington, Delaware 19801, or at such other date and time as the Court may des