Contract analysis

I. INTRODUCTION AND DECLARANT IDENTIFICATION

1. I, Jennifer R. Lindquist, hereby declare as follows. I am a Senior Vice President and Director of Tabulation Services at Pinnacle Claims Administration LLC ("Pinnacle"), a limited liability company organized under the laws of the State of Minnesota, with its principal office located at 1010 Dale Street North, St. Paul, Minnesota 55117. I am over the age of eighteen (18), am competent to testify as to the matters s

2. Pinnacle was retained as the claims and noticing agent in the Chapter 11 cases of Crestline Packaging Solutions LLC ("Crestline" or "CPS") and CPS Holdings Inc. ("CPS Holdings," and together with Crestline, the "Debtors") pursuant to an order of this Court entered on June 22, 2022. In connection with the solicitation of votes on the Prepackaged Plan of Reorganization of Crestline Packaging Solutions LLC and CPS Ho

3. This declaration is submitted pursuant to 28 U.S.C. § 1746 in lieu of verification by affidavit. The purpose of this declaration is to certify to the Court the results of the voting on the Plan by holders of claims in Classes 2, 3, and 4 — the three impaired classes of claims that were entitled to vote on the Plan. This declaration is submitted in support of the Debtors' motion for entry of an order confirming the

4. In my capacity as Senior Vice President and Director of Tabulation Services at Pinnacle, I supervised the ballot distribution, collection, review, and tabulation process for the Plan. I have personal knowledge of the procedures employed by Pinnacle in tabulating the votes, the methodology used to determine whether individual ballots should be counted or excluded, and the aggregate results of the voting for each cl

II. BACKGROUND A. The Chapter 11 Cases

5. On June 20, 2022 (the "Petition Date"), Crestline Packaging Solutions LLC, an Ohio limited liability company headquartered at 4710 Industrial Corridor Drive, Akron, Ohio 44308, and CPS Holdings Inc., a Delaware corporation and the direct parent and sole equity holder of Crestline, filed voluntary petitions for relief under Chapter 11 of Title 11 of the United States Code, 11 U.S.C. §§ 101–1532 (the "Bankruptcy Cod

6. 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 statutory committee of unsecured creditors has been appointed in these cases. B. Retention of Pinnacle as Claims and Noticing Agent / Tabulation Agent

7. By order dated June 22, 2022 [Dkt. 14], this Court approved the retention and appointment of Pinnacle as the claims and noticing agent for the Debtors pursuant to 28 U.S.C. § 156(c) and the applicable procedures governing claims and noticing agents in this District. In this capacity, Pinnacle has been responsible for, among other things, maintaining the official claims register, receiving and docketing proofs of c

8. In connection with the solicitation of votes on the Plan, Pinnacle was further designated as the official tabulation agent responsible for (i) distributing ballot packages to holders of claims in the impaired classes entitled to vote on the Plan, (ii) receiving and processing completed ballots, (iii) determining the validity of each ballot received, and (iv) tabulating and certifying the results of the voting. The

9. The Debtors filed the Plan as Dkt. 47 and the accompanying Disclosure Statement Describing the Prepackaged Plan of Reorganization of Crestline Packaging Solutions LLC and CPS Holdings Inc. (the "Disclosure Statement") as Dkt. 48 on or about June 20, 2022, simultaneously with the commencement of these Chapter 11 cases.

10. The Plan is a prepackaged plan of reorganization within the meaning of sections 1125 and 1126 of the Bankruptcy Code. The solicitation of votes on the Plan was conducted prior to the Petition Date, in compliance with applicable non-bankruptcy law (including the Securities Act of 1933, as amended, and the Trust Indenture Act of 1939, as amended, to the extent applicable) and section 1126(b) of the Bankruptcy Code.

11. The hearing to consider the adequacy of the Disclosure Statement pursuant to section 1125 of the Bankruptcy Code and the confirmation of the Plan pursuant to section 1129 of the Bankruptcy Code is scheduled for August 10, 2022 (the "Confirmation Hearing"). D. Solicitation Procedures

12. In connection with the filing of the Chapter 11 cases, the Debtors filed a motion seeking entry of an order (i) approving the solicitation procedures employed in connection with the prepetition solicitation of votes on the Plan (the "Solicitation Procedures"), (ii) confirming the adequacy of the prepetition solicitation conducted under section 1126(b) of the Bankruptcy Code, and (iii) establishing the Voting Dead

13. Pursuant to the Solicitation Procedures Order, the Voting Deadline was established as August 3, 2022 at 5:00 p.m. (Eastern Time). All ballots were required to be properly completed, executed, and received by Pinnacle on or before the Voting Deadline in order to be counted as valid votes on the Plan.

14. Ballot forms, in the forms approved by the Court as exhibits to the Solicitation Procedures Order, were distributed to holders of claims in Classes 2, 3, and 4 — the three impaired classes entitled to vote on the Plan. Each ballot form identified the class of the holder's claim, provided instructions for completing and returning the ballot, specified the Voting Deadline, and identified the addresses and electroni

15. Under the Plan, Classes 1 and 5 are unimpaired or otherwise deemed to accept the Plan and were not entitled to vote. Specifically: (a) Class 1 (Other Priority Claims) is unimpaired under the Plan. Holders of Class 1 claims are deemed to have accepted the Plan pursuant to section 1126(f) of the Bankruptcy Code and were not entitled to vote on the Plan. (b) Class 5 (Intercompany Claims) consists of intercompany cla

16. Class 6 (Existing Equity Interests), consisting of the equity interests in CPS Holdings held by Thornfield Capital Partners LP ("Thornfield"), is deemed to have rejected the Plan pursuant to section 1126(g) of the Bankruptcy Code because holders of Class 6 interests will receive no distribution under the Plan and all existing equity interests will be cancelled on the Effective Date. Accordingly, Class 6 was not s

III. CLASSIFICATION OF CLAIMS AND INTERESTS UNDER THE PLAN

17. The Plan classifies claims against and interests in the Debtors into six classes. The following is a summary of each class, its treatment under the Plan, estimated recovery, and voting status: Class 1 — Other Priority Claims

18. Class 1 consists of all allowed priority claims against the Debtors other than administrative expense claims and priority tax claims (which are treated separately under the Plan). Under the Plan, holders of Class 1 claims shall be paid in full, in cash, on the later of (i) the Effective Date and (ii) the date on which such claim becomes an allowed claim, or as soon thereafter as is reasonably practicable. The est

19. Class 2 consists of all allowed claims arising under the First Lien Credit Agreement dated as of October 13, 2017 (as amended, restated, supplemented, or otherwise modified from time to time, the "First Lien Credit Agreement"), by and among Crestline Packaging Solutions LLC, as borrower, CPS Holdings Inc., as guarantor, the lenders party thereto from time to time, and Ridgeline National Bank, N.A. ("Ridgeline"),

20. Under the Plan, holders of Class 2 claims shall receive, in full and final satisfaction, settlement, release, and discharge of their First Lien Secured Claims: (i) their pro rata share of 92% of the newly issued equity interests in reorganized Crestline (the "Reorganized Equity"), subject to dilution by the Management Incentive Plan (as defined in the Plan); and (ii) their pro rata share of $12,500,000 in aggrega

21. Class 3 consists of all allowed claims arising under the 9.75% Senior Secured Second Lien Notes due 2024 (the "Second Lien Notes"), issued on October 13, 2017 pursuant to that certain Indenture dated as of October 13, 2017 (the "Second Lien Indenture"), by and between Crestline Packaging Solutions LLC, as issuer, CPS Holdings Inc., as guarantor, and Continental Fiduciary Trust Company ("Continental Fiduciary"), a

22. Under the Plan, holders of Class 3 claims shall receive, in full and final satisfaction, settlement, release, and discharge of their Second Lien Secured Claims: (i) their pro rata share of 8% of the Reorganized Equity, subject to dilution by the Management Incentive Plan; and (ii) warrants entitling the holders thereof to purchase, in the aggregate, up to an additional 5% of the Reorganized Equity (on a fully dil

23. Class 4 consists of all allowed general unsecured claims against the Debtors, including but not limited to trade claims, contract rejection damage claims, and other unsecured claims that are not otherwise classified under the Plan. The aggregate amount of Class 4 claims is estimated to be approximately $14,800,000.

24. Under the Plan, holders of Class 4 claims shall receive, in full and final satisfaction, settlement, release, and discharge of their general unsecured claims, their pro rata share of a $1,500,000 cash distribution pool (the "GUC Distribution Pool"), which shall be funded by reorganized Crestline on the Effective Date. Based on the estimated aggregate amount of Class 4 claims, the estimated recovery for holders of

25. Class 5 consists of all intercompany claims between and among the Debtors. Under the Plan, Class 5 claims shall be, at the Debtors' election, either reinstated or cancelled on the Effective Date. The treatment of Class 5 claims shall be determined by the Debtors in their sole discretion in consultation with the Requisite Consenting Creditors (as defined in the Restructuring Support Agreement). Class 5 is not enti

26. Class 6 consists of all existing equity interests in CPS Holdings Inc., which are held by Thornfield Capital Partners LP. Under the Plan, all Class 6 equity interests shall be cancelled on the Effective Date, and holders thereof shall receive no distribution under the Plan. Class 6 is deemed to have rejected the Plan pursuant to section 1126(g) of the Bankruptcy Code, and holders of Class 6 interests were not sol

IV. TABULATION PROCEDURES AND METHODOLOGY A. Receipt and Processing of Ballots

27. In accordance with the Solicitation Procedures Order and the instructions set forth in the ballot forms, Pinnacle received ballots from holders of claims in Classes 2, 3, and 4 by the following methods: (i) first-class mail, postage prepaid, addressed to Pinnacle Claims Administration LLC, Ballot Processing Center, P.O. Box 5012, St. Paul, Minnesota 55101; (ii) overnight courier or hand delivery to Pinnacle Claim

28. All ballots were required to be properly completed, executed, and actually received by Pinnacle on or before the Voting Deadline of August 3, 2022 at 5:00 p.m. (Eastern Time). Ballots received after the Voting Deadline were not counted, regardless of when they were mailed or transmitted.

29. Upon receipt, each ballot was logged and reviewed by Pinnacle personnel for the following: (a) Timely receipt. Whether the ballot was received by Pinnacle on or before the Voting Deadline. (b) Proper completion and execution. Whether the ballot was properly completed, including the identification of the voting party, the claim amount, and a clear indication of whether the holder accepted or rejected the Plan, and

30. Votes were tabulated in accordance with section 1126(c) of the Bankruptcy Code, which provides that a class of claims has accepted a plan if such plan has been accepted by creditors, other than any entity designated under section 1126(e), that hold at least two-thirds in amount and more than one-half in number of the allowed claims of such class held by creditors that have accepted or rejected such plan. Only bal

31. The following additional rules were applied in the tabulation process, consistent with the Solicitation Procedures Order: (a) Duplicative ballots. In instances where a holder submitted more than one ballot with respect to the same claim, only the latest-dated valid ballot was counted for purposes of the tabulation. If two or more ballots for the same claim bore the same date, Pinnacle attempted to contact the hol

32. For purposes of voting on the Plan, claims were temporarily allowed at the amounts reflected on the Debtors' schedules of assets and liabilities (the "Schedules"), as may be amended, or as set forth in timely filed proofs of claim, unless (i) the claim was the subject of a pending objection, in which case the claim was temporarily allowed in the amount, if any, set forth in the applicable ballot (subject to Court

V. VOTING RESULTS — CERTIFICATION A. Statutory Threshold

33. Under section 1126(c) of the Bankruptcy Code, a class of claims has accepted a plan of reorganization if the plan has been accepted by creditors that hold at least two-thirds in amount (i.e., 66.67% or more) and more than one-half in number (i.e., more than 50.00%) of the allowed claims of such class held by creditors, other than any entity designated under section 1126(e), that have accepted or rejected such pla

34. The following table summarizes the voting results for Class 2 (First Lien Secured Claims):

35. The aggregate principal amount of First Lien Secured Claims is $191,300,000. Of the 24 holders of Class 2 claims that returned valid, timely ballots, 21 holders, holding claims in the aggregate amount of $181,161,100, voted to accept the Plan, and 3 holders, holding claims in the aggregate amount of $10,138,900, voted to reject the Plan.

36. Accordingly, the Plan was accepted by holders representing 94.7% of the aggregate amount of Class 2 claims that voted, which exceeds the two-thirds (66.67%) threshold required under section 1126(c) of the Bankruptcy Code. The Plan was further accepted by 87.5% of the number of Class 2 claimants that voted, which exceeds the one-half (50.00%) threshold required under section 1126(c) of the Bankruptcy Code.

37. Conclusion: Class 2 (First Lien Secured Claims) has ACCEPTED the Plan. C. Class 3 — Second Lien Secured Claims

38. The following table summarizes the voting results for Class 3 (Second Lien Secured Claims):

39. The aggregate amount of Second Lien Secured Claims is approximately $59,900,000, consisting of $56,000,000 in outstanding principal amount of the Second Lien Notes (CUSIP No. 22761TAA3) plus approximately $3,900,000 in accrued and unpaid interest (including default rate interest at an additional 2.00% per annum from April 22, 2022). Of the 14 holders (or nominees submitting master ballots on behalf of beneficial

40. Accordingly, the Plan was accepted by holders representing 89.2% of the aggregate amount of Class 3 claims that voted, which exceeds the two-thirds (66.67%) threshold required under section 1126(c) of the Bankruptcy Code. The Plan was further accepted by 78.6% of the number of Class 3 claimants that voted, which exceeds the one-half (50.00%) threshold required under section 1126(c) of the Bankruptcy Code.

41. Conclusion: Class 3 (Second Lien Secured Claims) has ACCEPTED the Plan. D. Class 4 — General Unsecured Claims

42. The following table summarizes the voting results for Class 4 (General Unsecured Claims):

43. The aggregate estimated amount of General Unsecured Claims is approximately $14,800,000. Of the 38 holders of Class 4 claims that returned valid, timely ballots, 26 holders, holding claims in the aggregate amount of $11,292,400, voted to accept the Plan, and 12 holders, holding claims in the aggregate amount of $3,507,600, voted to reject the Plan.

44. Accordingly, the Plan was accepted by holders representing 76.3% of the aggregate amount of Class 4 claims that voted, which exceeds the two-thirds (66.67%) threshold required under section 1126(c) of the Bankruptcy Code. The Plan was further accepted by 68.4% of the number of Class 4 claimants that voted, which exceeds the one-half (50.00%) threshold required under section 1126(c) of the Bankruptcy Code.

45. Conclusion: Class 4 (General Unsecured Claims) has ACCEPTED the Plan.

VI. CONSOLIDATED SUMMARY OF VOTING RESULTS

46. The following table presents a consolidated summary of the voting results for all impaired classes entitled to vote on the Plan:

47. As reflected in the table above, each of the three impaired classes entitled to vote on the Plan — Class 2 (First Lien Secured Claims), Class 3 (Second Lien Secured Claims), and Class 4 (General Unsecured Claims) — has accepted the Plan by the requisite statutory majorities under section 1126(c) of the Bankruptcy Code. Specifically, in each such class, the Plan was accepted by creditors holding at least two-third

48. In addition, as set forth in Section III above, Class 1 (Other Priority Claims) is unimpaired and deemed to accept the Plan under section 1126(f) of the Bankruptcy Code. Class 6 (Existing Equity Interests) is deemed to reject the Plan under section 1126(g) of the Bankruptcy Code. Class 5 (Intercompany Claims) was not entitled to vote on the Plan. Accordingly, all classes of claims entitled to vote have accepted t

VII. IRREGULARITIES AND DEFECTIVE BALLOTS

49. In the course of the ballot tabulation process, Pinnacle identified the following irregularities with respect to certain ballots received: (a) Late Ballots. Pinnacle received a total of four (4) ballots after the Voting Deadline of August 3, 2022 at 5:00 p.m. (Eastern Time). These late ballots consisted of one (1) ballot in Class 2, zero (0) ballots in Class 3, and three (3) ballots in Class 4. In accordance with

50. Pinnacle confirms that none of the irregularities described above, individually or in the aggregate, would alter the outcome of the voting in any class. Even if all late and defective ballots were counted (in either direction), the Plan would still satisfy the acceptance thresholds of section 1126(c) in each impaired class.

51. Attached hereto as exhibits and incorporated herein by reference are the following detailed tabulation reports and schedules: Exhibit A — Detailed Tabulation Report for Class 2 (First Lien Secured Claims). Exhibit A sets forth an itemized list of each ballot received by Pinnacle from holders of Class 2 claims, identifying (i) the claimant or holder name, (ii) the claim amount, (iii) the vote cast (accept or rejec

52. The information contained in Exhibits A through D was compiled from Pinnacle's records and represents a complete and accurate accounting of all ballots received by Pinnacle in connection with the solicitation of votes on the Plan.