Contract analysis

1. On June 20, 2022 (the "Petition Date"), Crestline Packaging Solutions LLC, an Ohio limited liability company (EIN 31-1782094), and CPS Holdings Inc., a Delaware corporation (EIN 82-3491657) (collectively, the "Debtors"), each filed a voluntary petition for relief under chapter 11 of title 11 of the United States Code (the "Bankruptcy Code") in the United States Bankruptcy Court for the Northern District of Ohio (t

2. The Debtors continue to operate their businesses and manage their properties as debtors in possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. No trustee, examiner, or official committee of unsecured creditors has been appointed in these cases as of the date hereof.

3. By this motion (the "Motion"), the Debtors seek entry of an order, substantially in the form attached hereto as Exhibit B (the "Proposed Order"), pursuant to 28 U.S.C. § 156(c), the Local Rules of the United States Bankruptcy Court for the Northern District of Ohio (the "Local Rules"), and the Court's inherent authority, authorizing the retention and employment of Pinnacle Claims Administration LLC ("Pinnacle"), a

4. As described more fully below, the appointment of Pinnacle as claims and noticing agent is necessary and appropriate in light of the anticipated number of creditors and parties in interest in these cases, the complexity of the prepackaged plan process that the Debtors are pursuing, and the critical need for efficient, accurate, and timely administration of the claims register, service of notices, distribution of s

5. This Court has jurisdiction to consider and determine this Motion pursuant to 28 U.S.C. §§ 157 and 1334, and the General Order of Reference entered by the United States District Court for the Northern District of Ohio.

6. This is a core proceeding within the meaning of 28 U.S.C. § 157(b)(2). The Debtors confirm that they consent to the entry of a final order by this Court with respect to this Motion to the extent that it is later determined that the Court, absent consent of the parties, cannot enter final orders or judgments in connection herewith consistent with Article III of the United States Constitution.

7. Venue is proper in this district pursuant to 28 U.S.C. §§ 1408 and 1409. The Debtors' principal place of business, including the corporate headquarters and primary manufacturing operations, is located within this judicial district.

8. The statutory and legal predicates for the relief requested herein are 28 U.S.C. § 156(c) and the Local Rules of this Court, which authorize the Clerk of Court to delegate to private entities the responsibility for maintaining the claims register and providing notice in chapter 11 cases where the conditions of the case so warrant.

III. BACKGROUND A. The Debtors' Business

9. Crestline Packaging Solutions LLC ("Crestline" or the "Company") is an Ohio-headquartered manufacturer of specialty chemical packaging and industrial containment products. The Company designs, manufactures, and distributes a comprehensive range of packaging solutions, including high-density polyethylene ("HDPE") drums, intermediate bulk containers ("IBCs"), steel pails, and specialty containment vessels. These pro

10. The Company's products serve a diversified customer base across the chemical manufacturing, petrochemical refining, and agricultural chemical sectors. Crestline maintains long-standing relationships with many of its key customers, several of which have been purchasing the Company's products for more than a decade. The Company's end-market diversification and the essential, consumable nature of its products have h

11. The Debtors operate four manufacturing facilities strategically located to serve their principal end markets: (a) Plant 1 (Headquarters): 4710 Industrial Corridor Drive, Akron, OH 44308. This facility serves as the Company's corporate headquarters and is the primary site for HDPE drum manufacturing. Plant 1 employs approximately 480 individuals, including all corporate administrative and management personnel. (b)

12. In addition to the four manufacturing plants described above, the Debtors lease approximately 185,000 square feet of warehouse and distribution space at 900 Darrow Road, Akron, OH 44305, from Benchmark Real Estate Holdings LLC, under a lease agreement dated March 1, 2019, with an initial term expiring on February 28, 2024. This warehouse supports finished goods inventory management and outbound logistics for Plan

13. As of the Petition Date, the Debtors employ approximately 1,420 individuals across all facilities, including salaried management, hourly production workers, sales and marketing personnel, and corporate administrative staff. The Debtors' workforce is not represented by any collective bargaining unit.

14. For the fiscal year ended December 31, 2021 ("FY2021"), the Debtors generated total revenue of approximately $312.6 million and earnings before interest, taxes, depreciation, and amortization ("EBITDA") of approximately $38.4 million. However, the Company's financial performance deteriorated materially during the first quarter of 2022 as a result of significant margin compression driven by escalating polyethylene

15. Crestline Packaging Solutions LLC was formed in 2007 and operated as a portfolio company of its original founders until 2017. On October 13, 2017, Thornfield Capital Partners LP ("Thornfield"), a New York-based private equity sponsor, acquired Crestline through a leveraged buyout transaction at an aggregate enterprise value of approximately $410.0 million. In connection with the acquisition, Thornfield contribute

16. As of the Petition Date, the Debtors' total funded indebtedness was approximately $247.3 million, consisting of the following obligations: (i) A revolving credit facility with commitments of $40.0 million, of which approximately $32.6 million was drawn as of the Petition Date, under that certain First Lien Credit Agreement, dated as of October 13, 2017 (as amended, restated, supplemented, or otherwise modified fr

17. Ridgeline National Bank, N.A. ("Ridgeline") serves as administrative agent and collateral agent under the First Lien Credit Agreement. Continental Fiduciary Trust Company (the "Indenture Trustee") serves as indenture trustee under the Indenture governing the Second Lien Notes.

18. The Debtors' financial deterioration in the first quarter of 2022 resulted in a breach of the maximum total leverage ratio maintenance covenant contained in Section 7.11 of the First Lien Credit Agreement. Specifically, as of March 31, 2022, the Debtors' actual total leverage ratio was approximately 8.50x, which materially exceeded the maximum permitted leverage ratio of 5.75x. On April 22, 2022, Ridgeline, actin

19. Following the delivery of the Notice of Default, the Debtors, together with their legal and financial advisors, engaged in intensive negotiations with their principal creditor constituencies regarding a consensual restructuring of the Debtors' balance sheet. On May 18, 2022, the Debtors and the consenting first lien lenders entered into a Forbearance Agreement (the "Forbearance Agreement"), pursuant to which the

20. On June 20, 2022, the Debtors filed these chapter 11 cases in connection with a prepackaged plan of reorganization (the "Prepackaged Plan" or "Plan") that was negotiated among the Debtors, the Ad Hoc Group of First Lien Lenders (represented by Hargrove, Mitchell & Saunders LLP), the Ad Hoc Group of Second Lien Noteholders (represented by Pemberton & Locke LLP), and Thornfield Capital Partners LP. The Prepackaged

21. In furtherance of the prepackaged restructuring, the Debtors, the Ad Hoc Group of First Lien Lenders, the Ad Hoc Group of Second Lien Noteholders, and Thornfield executed a Restructuring Support Agreement (the "RSA") on July 8, 2022. The RSA establishes binding milestones governing the pace of these chapter 11 cases, including, inter alia: (a) entry of an order approving the Disclosure Statement within 45 days of

22. These chapter 11 cases involve a significant number of creditors, equity interest holders, and parties in interest. The Debtors' creditor body includes, without limitation: (a) holders of claims under the first lien revolving credit facility and first lien term loan, consisting of a syndicate of institutional lenders; (b) holders of the Second Lien Notes, consisting of institutional investors and certain crossove

23. In addition, the Court has authorized the Debtors to pay critical vendor claims in an aggregate amount of up to $6.8 million, further reflecting the breadth and complexity of the Debtors' commercial relationships and the multiplicity of parties with interests in these cases.

24. Given the prepackaged nature of these chapter 11 cases, the efficient and timely service of the Disclosure Statement and the Prepackaged Plan, proper distribution of ballots to holders of impaired claims entitled to vote, accurate tabulation of votes, and diligent maintenance of the claims register are essential to the Debtors' ability to meet the RSA milestones and achieve a prompt emergence from bankruptcy. Any

25. Distributing the claims and noticing responsibilities described herein to the Clerk of Court would place an undue and unwarranted burden on the Clerk's office, given the volume of notices, the number of creditors and parties in interest, and the specialized requirements of vote tabulation in a prepackaged chapter 11 case. The appointment of a qualified private claims and noticing agent is the appropriate means to

26. By this Motion, the Debtors respectfully request that the Court enter an order, substantially in the form of the Proposed Order attached hereto as Exhibit B, authorizing the retention and employment of Pinnacle Claims Administration LLC as claims and noticing agent in these chapter 11 cases, effective nunc pro tunc to the Petition Date (June 20, 2022), pursuant to 28 U.S.C. § 156(c) and the applicable Local Rules

V. PINNACLE'S QUALIFICATIONS A. Corporate Information

27. Pinnacle Claims Administration LLC ("Pinnacle") is a limited liability company organized under the laws of the State of Minnesota. Pinnacle's principal office is located at 1010 Dale Street North, St. Paul, MN 55117. Pinnacle is a nationally recognized provider of claims administration, noticing, solicitation, and vote tabulation services in large chapter 11 cases. B. Experience and Capabilities

28. Pinnacle has extensive experience serving as claims and noticing agent in complex chapter 11 cases in bankruptcy courts across the United States, including cases involving prepackaged plans of reorganization, prenegotiated plans, and traditional free-fall filings. Pinnacle has served in this capacity in cases in the Northern District of Ohio, as well as in the Southern District of New York, the District of Delawa

29. Pinnacle maintains sophisticated proprietary systems and technological infrastructure for the electronic filing of proofs of claim, comprehensive claims register management, ballot distribution and collection, automated and manual vote tabulation, and the service of court papers and notices via first-class mail, email, and other methods as may be directed by the Court. Pinnacle's systems are designed to handle ca

30. The Debtors selected Pinnacle after evaluating proposals from multiple claims and noticing agent providers. In the Debtors' business judgment, Pinnacle offers competitive pricing, demonstrated competence, and the technological capabilities and staffing resources necessary to meet the demanding timeline and administrative requirements of these prepackaged chapter 11 cases. The Debtors believe that Pinnacle's reten

31. To the best of the Debtors' knowledge, information, and belief, formed after due inquiry, Pinnacle does not hold or represent any interest adverse to the Debtors, their estates, their creditors, or any other party in interest in these chapter 11 cases. Pinnacle has no connection to the Debtors, their affiliates, their creditors, their equity holders, the Office of the United States Trustee, or any other party in

32. Pinnacle has conducted its own conflicts review and has advised the Debtors that it is prepared to file a declaration confirming its disinterestedness and the absence of adverse interests, as required by applicable law, the Bankruptcy Rules, and the Local Rules.

33. If this Motion is granted, Pinnacle will be authorized and directed to perform the following services in these chapter 11 cases, subject at all times to the supervision and direction of the Court and in accordance with all applicable provisions of the Bankruptcy Code, the Bankruptcy Rules, and the Local Rules: A. Claims Register and Claims Administration (a) Maintain the official claims register in these chapter

VII. COMPENSATION A. Fee Structure

34. Pinnacle will be compensated for its services in these chapter 11 cases in accordance with its customary rates and fee schedule, a copy of which is attached hereto as Exhibit A (or, if not available at the time of filing, shall be filed supplementally with the Court prior to the hearing on this Motion). Pinnacle's fee schedule sets forth its standard hourly rates and/or per-unit charges for claims processing, not

35. Based on the anticipated scope of services and the estimated number of creditors and parties in interest in these cases, the Debtors estimate that Pinnacle's total fees and expenses for services rendered in these chapter 11 cases will be approximately $285,000. This estimate is subject to adjustment based on the actual scope, complexity, and volume of services rendered by Pinnacle during the course of these cases

36. Pinnacle will submit monthly invoices to the Debtors for services rendered and expenses incurred during the preceding month. Each invoice shall contain reasonable detail regarding the nature of the services performed, the time expended (if applicable), and the expenses incurred.

37. Payment of Pinnacle's fees and expenses will be subject to the approval of the Court as an administrative expense of the Debtors' estates pursuant to sections 503(b) and 507(a)(2) of the Bankruptcy Code, or as otherwise provided by applicable law governing claims and noticing agents retained under 28 U.S.C. § 156(c). The Debtors submit that Pinnacle's fees and expenses constitute actual, necessary costs of preser

38. Because Pinnacle is being retained under 28 U.S.C. § 156(c) as an agent of the Court (or, in the alternative, as an administrative service provider whose fees constitute an administrative expense of the estates), rather than as a "professional person" retained under section 327 of the Bankruptcy Code, Pinnacle shall not be required to file formal fee applications under section 330 of the Bankruptcy Code. This tre

39. For the Court's information, and in the interest of full transparency regarding the anticipated professional costs of these chapter 11 cases, the Debtors note that Pinnacle's estimated fees of approximately $285,000 are included within the Debtors' total estimated professional fees for these chapter 11 cases of approximately $9.3 million. The aggregate estimated professional fees include the following:

40. The Debtors believe that the foregoing professional fees are reasonable and necessary for the successful administration of these chapter 11 cases and the implementation of the Prepackaged Plan. The retention of each of the above-listed professionals is or will be the subject of a separate motion or application filed with the Court.

VIII. BASIS FOR RELIEF A. 28 U.S.C. § 156(c)

41. Section 156(c) of title 28 of the United States Code provides, in relevant part, that "[a]ny court may utilize facilities or services, either on or off the court's premises, which pertain to the provision of notices, dockets, calendars, and other administrative information to parties in cases filed under title 11, United States Code, where the costs of such facilities or services are paid for out of the assets of

42. The complexity and size of these chapter 11 cases amply justify the appointment of a claims and noticing agent. The Debtors' creditor body includes approximately 1,420 employees, hundreds of trade creditors and vendors across four states, and institutional holders of first lien secured debt and second lien secured notes. In addition, the prepackaged plan process imposes specialized requirements for the accurate a

43. The appointment of Pinnacle as claims and noticing agent will relieve the Clerk of Court of the substantial administrative burden that would otherwise be imposed by these cases, including the receipt and docketing of proofs of claim, the maintenance of the master mailing list, the service of numerous notices and court filings, and the distribution and tabulation of ballots. Pinnacle's appointment will ensure that

44. The retention of a claims and noticing agent is consistent with the Local Rules of the United States Bankruptcy Court for the Northern District of Ohio. The Local Rules contemplate the appointment of private claims and noticing agents in large chapter 11 cases and set forth the procedures and requirements for such appointments. The Debtors have complied with all applicable Local Rule requirements in connection wi

45. In addition to the authority conferred by 28 U.S.C. § 156(c) and the Local Rules, this Court possesses inherent authority to manage its docket and to take such actions as are necessary to ensure the efficient and orderly administration of the cases before it. The appointment of a claims and noticing agent to handle the substantial volume of administrative tasks in these chapter 11 cases is a proper exercise of th

46. Notice of this Motion has been given to the following parties, which the Debtors submit is sufficient under the circumstances: (i) The Office of the United States Trustee for Region 9, Howard M. Metzenbaum U.S. Courthouse, 201 Superior Avenue, Cleveland, OH 44114; (ii) Ridgeline National Bank, N.A., as administrative agent and collateral agent under the First Lien Credit Agreement, 200 Public Square, Cleveland, O

47. The Debtors submit that no further notice of this Motion is necessary or required under the circumstances. In the event that any party in interest wishes to object to the relief requested herein, such party may file an objection with the Court in accordance with the applicable Bankruptcy Rules and Local Rules.

48. No prior request for the relief sought in this Motion has been made to this or any other court.

XI. CONCLUSION AND PRAYER FOR RELIEF WHEREFORE, the Debtors respectfully request that this Court enter an order, substantially in the form of the Proposed Order attached hereto as Exhibit B: (a) Authorizing the retention and employment of Pinnacle Claims Administration LLC, 1010 Dale Street North, St. Paul, MN 55117, as claims and noticing agent in these chapter 11 cases, effective nunc pro tunc to the Petition Date

I. Case Management and Administration