Contract analysis

1. Jurisdiction and Venue. This Court has jurisdiction over these Chapter 11 cases and the DIP Motion pursuant to 28 U.S.C. §§ 157 and 1334 and the General Order of Reference entered in this district. Venue of these Chapter 11 cases and the DIP Motion is proper in this district pursuant to 28 U.S.C. §§ 1408 and 1409. This matter constitutes a core proceeding within the meaning of 28 U.S.C. § 157(b)(2), and the Court

2. Notice. Adequate and sufficient notice of the DIP Motion, the Interim DIP Order, and the Final Hearing was provided to all parties required to receive notice, including, without limitation: (a) the Office of the United States Trustee for Region 9 (Howard M. Metzenbaum U.S. Courthouse, 201 Superior Avenue, Cleveland, OH 44114); (b) Hargrove, Mitchell & Saunders LLP, as counsel to the Ad Hoc Group of First Lien Lend

3. Good Cause. Good cause has been shown for entry of this Final Order pursuant to Sections 105, 361, 362, 363, and 364 of the Bankruptcy Code. Entry of this Final Order is in the best interests of the Debtors' estates, their creditors, and all parties in interest.

4. Business Justification and Necessity. The Debtors have an immediate and critical need for the DIP Facility in order to, among other things: (a) fund ongoing operations at their four manufacturing facilities; (b) meet payroll obligations for approximately 1,420 employees; (c) maintain relationships with critical vendors and suppliers, including Northstar Polymers Inc. and other key raw material providers; (d) prese

5. No Credit Available on Better Terms. The Debtors have been unable to obtain sufficient postpetition financing on any basis other than the terms and conditions set forth in the DIP Credit Agreement and this Final Order. The Debtors have established, and the Court finds, that credit was not available to the Debtors on an unsecured basis under Section 503(b)(1) of the Bankruptcy Code, or on a secured basis pursuant t

6. Good Faith — Section 364(e). The DIP Agent and the DIP Lenders have extended credit under the DIP Facility in good faith within the meaning of Section 364(e) of the Bankruptcy Code, and the DIP Agent and the DIP Lenders are entitled to the full protections afforded by Section 364(e) of the Bankruptcy Code, including protection against reversal or modification on appeal. The terms and conditions of the DIP Facility

7. Adequate Protection. The Prepetition Secured Parties are entitled to adequate protection of their interests in the Prepetition Collateral pursuant to Sections 361, 362, 363, and 364 of the Bankruptcy Code to the extent of any diminution in the value of such interests resulting from, among other things: (a) the Debtors' use, sale, or lease of Prepetition Collateral (including cash collateral); (b) the priming of th

I. AUTHORIZATION OF DIP FACILITY A. Approval of DIP Credit Agreement. The DIP Motion is hereby GRANTED on a final basis. The Debtors are authorized to borrow under the DIP Facility, on the terms and conditions set forth in the DIP Credit Agreement dated as of June 24, 2022, up to an aggregate principal amount of Thirty Million Dollars ($30,000,000) (the "DIP Facility Amount"), in the form of a senior secured superpri

II. DIP LIENS A. Grant of Liens — Section 364(c)(2) and 364(c)(3). As security for the prompt and complete payment and performance of all obligations arising under or in connection with the DIP Credit Agreement, this Final Order, and the other DIP Documents, whether now existing or hereafter arising (collectively, the "DIP Obligations"), the DIP Agent is hereby granted, effective as of the Petition Date, for the bene

III. SUPERPRIORITY ADMINISTRATIVE EXPENSE CLAIMS A. Section 364(c)(1) Superpriority. Pursuant to Section 364(c)(1) of the Bankruptcy Code, all DIP Obligations shall constitute allowed superpriority administrative expense claims against each of the Debtors and their respective estates (the "DIP Superpriority Claims"), with priority in payment over any and all administrative expense claims, unsecured claims, and all ot

IV. CARVE-OUT. A. Definition. As used in this Final Order, the term "Carve-Out" shall mean the sum of the following amounts: (i) all unpaid fees of the Clerk of the Bankruptcy Court and the United States Trustee pursuant to 28 U.S.C. § 1930(a)(6), without regard to whether a Carve-Out Trigger Notice (as defined below) has been delivered; (ii) all reasonable and documented fees and expenses incurred by professionals r

V. ADEQUATE PROTECTION FOR PREPETITION SECURED PARTIES As adequate protection of the interests of the Prepetition Secured Parties in the Prepetition Collateral, and pursuant to Sections 361, 362, 363(e), and 364(d)(1) of the Bankruptcy Code, the following adequate protection is hereby granted: A. Adequate Protection for First Lien Secured Parties. The holders of claims under the First Lien Credit Agreement (the "Firs

1. Adequate Protection Liens. The First Lien Secured Parties are hereby granted, pursuant to Sections 361(2) and 363(e) of the Bankruptcy Code, valid, binding, continuing, enforceable, fully perfected replacement liens on and security interests in (the "First Lien Adequate Protection Liens") all postpetition assets of the Debtors and their estates, including all DIP Collateral and all proceeds and products thereof, w

2. Adequate Protection Superpriority Claims. The First Lien Secured Parties are hereby granted allowed superpriority administrative expense claims under Section 507(b) of the Bankruptcy Code (the "First Lien Adequate Protection Superpriority Claims"), which claims shall be junior to the DIP Superpriority Claims and the Carve-Out, but shall be senior to all other administrative expense claims and priority claims of an

3. Adequate Protection Payments — Current Interest. As further adequate protection, the Debtors shall pay current interest to the First Lien Secured Parties (through the Prepetition First Lien Agent) at the applicable non-default contract rate under the First Lien Credit Agreement on the outstanding Prepetition First Lien Obligations, payable monthly in arrears on the first business day of each calendar month during

4. Payment of Fees and Expenses. As further adequate protection, the Debtors shall pay the reasonable and documented fees and expenses of Hargrove, Mitchell & Saunders LLP, as counsel to the Ad Hoc Group of First Lien Lenders (lead partner Victoria Kline; lead associate Thomas Frey; 51 West 52nd Street, New York, NY 10019), promptly upon presentation of invoices therefor, in accordance with the DIP Budget. Such payme

5. Reporting and Information Rights. As further adequate protection, the Debtors shall provide the First Lien Secured Parties (through the DIP Agent, in its dual capacity as DIP Agent and Prepetition First Lien Agent) with the following: (a) copies of the 13-week rolling DIP Budget, as updated and delivered to the DIP Agent on a bi-weekly basis; (b) bi-weekly variance reports showing actual results compared to the DI

1. Adequate Protection Liens. The Second Lien Secured Parties are hereby granted, pursuant to Sections 361(2) and 363(e) of the Bankruptcy Code, valid, binding, continuing, enforceable, fully perfected replacement liens on and security interests in (the "Second Lien Adequate Protection Liens") all postpetition assets of the Debtors and their estates, including all DIP Collateral and all proceeds and products thereof,

2. Adequate Protection Superpriority Claims. The Second Lien Secured Parties are hereby granted allowed superpriority administrative expense claims under Section 507(b) of the Bankruptcy Code (the "Second Lien Adequate Protection Superpriority Claims"), which claims shall be junior to the DIP Superpriority Claims, the Carve-Out, and the First Lien Adequate Protection Superpriority Claims, but shall be senior to all o

3. Payment of Fees and Expenses. As further adequate protection, the Debtors shall pay the reasonable and documented fees and expenses of Pemberton & Locke LLP, as counsel to the Ad Hoc Group of Second Lien Noteholders (lead partner Raymond Delvecchio; lead associate Nia Patterson; 1 Liberty Plaza, New York, NY 10006), promptly upon presentation of invoices therefor, in accordance with the DIP Budget. Such payments s

4. Reporting and Information Rights. As further adequate protection, the Second Lien Secured Parties (through Continental Fiduciary Trust Company, as Indenture Trustee, 101 Barclay Street, New York, NY 10286) shall receive copies of the same financial reporting provided to the First Lien Secured Parties pursuant to Section V.A.5 of this Final Order, subject to applicable confidentiality restrictions and the terms of

VI. USE OF CASH COLLATERAL A. Authorization. The Debtors are hereby authorized, pursuant to Section 363 of the Bankruptcy Code, to use cash collateral (as defined in Section 363(a) of the Bankruptcy Code) of the Prepetition Secured Parties in accordance with the DIP Budget and the terms and conditions of this Final Order and the DIP Credit Agreement. The authorization to use cash collateral granted herein is subject

VII. EVENTS OF DEFAULT AND REMEDIES A. Events of Default. The occurrence of any of the following events shall constitute an "Event of Default" for purposes of this Final Order and the DIP Credit Agreement, to the extent set forth and more fully described in the DIP Credit Agreement: (i) failure by the Debtors to comply with the DIP Budget beyond the Permitted Variance; (ii) failure by the Debtors to satisfy any miles

VIII. PERMITTED PRIOR LIENS As used in this Final Order, the term "Permitted Prior Liens" means those liens and encumbrances that are senior in priority to the prepetition liens of the First Lien Secured Parties and the Second Lien Secured Parties by operation of applicable non-bankruptcy law and that are not subject to avoidance under Chapter 5 of the Bankruptcy Code or other applicable law. Permitted Prior Liens in

IX. MODIFICATION OF AUTOMATIC STAY A. Stay Relief. The automatic stay imposed under Section 362 of the Bankruptcy Code is hereby modified to the extent necessary to permit: (a) the DIP Agent and the DIP Lenders to exercise their rights and remedies under the DIP Credit Agreement and this Final Order upon the occurrence and during the continuance of an Event of Default, subject to the Remedies Notice Period and other

X. WAIVER AND STIPULATIONS A. Debtors' Stipulations. The Debtors hereby stipulate, acknowledge, and agree, for the benefit of the Prepetition Secured Parties and all parties in interest, as follows: (i) The Prepetition First Lien Obligations under the First Lien Credit Agreement, in the aggregate principal amount of approximately $191,300,000 outstanding as of the Petition Date, together with all accrued and unpaid i

XI. INSURANCE PROVISIONS Nothing in this Final Order shall impair, diminish, or otherwise modify the Debtors' directors' and officers' tail insurance policy issued by Apex Indemnity Insurance Company, Policy No. DOT-2022-CP-04871, providing aggregate coverage of Fifteen Million Dollars ($15,000,000), with a tail premium of One Million Two Hundred Thousand Dollars ($1,200,000). The proceeds of such directors' and offi

XII. PROVISIONS REGARDING PROFESSIONAL FEES Nothing in this Final Order shall prejudice, impair, or otherwise affect the right of the Debtors' professionals retained in these Chapter 11 cases, including Calderwood & Harkness LLP (estimated aggregate fees of approximately $4,200,000), Kellner & Hartwick LLP (estimated aggregate fees of approximately $380,000), Aldersgate Advisory Group LLC (estimated aggregate fees of

XIII. SECTION 506(c) WAIVER Except to the extent of the Carve-Out, no costs or expenses of administration that have been or may be incurred in these Chapter 11 cases at any time shall be charged against or recovered from the DIP Collateral or the Prepetition Collateral pursuant to Section 506(c) of the Bankruptcy Code, or any similar principle of law or equity (including, without limitation, the "equities of the case

XIV. SECTION 552(b) PROVISIONS The Prepetition Secured Parties shall be entitled to the benefits of Section 552(b) of the Bankruptcy Code, and the liens and security interests of the Prepetition Secured Parties shall extend to all proceeds, products, offspring, rents, and profits of the Prepetition Collateral acquired, generated, or received by the Debtors after the Petition Date. The "equities of the case" exception

XV. INTERCREDITOR PROVISIONS The relative priorities, rights, and obligations as among the First Lien Secured Parties and the Second Lien Secured Parties shall continue to be governed by that certain Intercreditor Agreement, dated as of October 13, 2017 (the "Intercreditor Agreement"), by and between Ridgeline National Bank, N.A. (in its capacity as First Lien Agent) and Continental Fiduciary Trust Company (in its ca

XVI. NO MARSHALING In no event shall the DIP Agent, the DIP Lenders, or the Prepetition Secured Parties be subject to the equitable doctrine of marshaling or any other similar doctrine with respect to the DIP Collateral, the Prepetition Collateral, or any other property of the Debtors or their estates. The DIP Agent, the DIP Lenders, and the Prepetition Secured Parties shall not be required to marshal any of their li

XVII. BINDING EFFECT AND SURVIVAL The provisions of this Final Order, including, without limitation, the DIP Liens, the DIP Superpriority Claims, the Adequate Protection Liens, and the Adequate Protection Superpriority Claims, shall be binding upon the Debtors, their estates, the DIP Agent, the DIP Lenders, the Prepetition Secured Parties, all creditors and parties in interest, and their respective successors, assign

XIX. NO WAIVER OF RIGHTS OF PREPETITION SECURED PARTIES Except as expressly set forth in this Final Order, nothing herein shall be deemed a waiver, release, or relinquishment of any rights, remedies, claims, or defenses of the Prepetition Secured Parties, whether arising under the Bankruptcy Code, applicable non-bankruptcy law, or any agreement or instrument, including, without limitation: (a) any right to object to

XX. EFFECTIVENESS. This Final Order shall be effective immediately upon its entry, and any stay of this Final Order, whether under Bankruptcy Rule 6004(h), Bankruptcy Rule 7062, Rule 62 of the Federal Rules of Civil Procedure, or otherwise, is hereby waived. The requirement of Bankruptcy Rule 4001(c)(2) has been satisfied. No further order of this Court shall be required for this Final Order to become effective.

XXI. RETENTION OF JURISDICTION This Court retains exclusive jurisdiction over all matters arising from or related to the interpretation, implementation, enforcement, and administration of this Final Order, the DIP Credit Agreement, and the other DIP Documents, including, without limitation, any dispute between or among the Debtors, the DIP Agent, the DIP Lenders, the Prepetition Secured Parties, or any other party in