1006-00002 · Crestline Packaging Solutions LLC · Petition and First Day

corporate-ownership-statement.docx DOCUMENT Finance & Banking

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UNITED STATES BANKRUPTCY COURT NORTHERN DISTRICT OF OHIO EASTERN DIVISION

¹ The Debtors in these jointly administered Chapter 11 cases, together with the last four digits of each Debtor's federal tax identification number, are: Crestline Packaging Solutions LLC (2094) and CPS Holdings Inc. (1657). The location of the Debtors' corporate headquarters and the service address for all Debtors is 4710 Industrial Corridor Drive, Akron, OH 44308.

CORPORATE OWNERSHIP STATEMENT PURSUANT TO FEDERAL RULE OF BANKRUPTCY PROCEDURE 2015.3

Crestline Packaging Solutions LLC ("Crestline" or "CPS") and CPS Holdings Inc. ("CPS Holdings" and, together with Crestline, the "Debtors"), as debtors and debtors in possession, respectfully submit this Corporate Ownership Statement (this "Statement") pursuant to Federal Rule of Bankruptcy Procedure 2015.3 and any applicable local rules of the United States Bankruptcy Court for the Northern District of Ohio (the "Court"), and respectfully represent as follows:

I. INTRODUCTION AND PURPOSE

1. The Debtors file this Corporate Ownership Statement pursuant to Federal Rule of Bankruptcy Procedure 2015.3, which requires each debtor that is a corporation to file periodic reports with the Court identifying all entities in which the debtor holds a controlling or substantial interest, as well as disclosing the organizational structure and equity ownership of each debtor entity. This Statement is also filed in accordance with any applicable provisions of the Local Bankruptcy Rules for the Northern District of Ohio.

2. The purpose of this Statement is threefold: (a) to disclose the organizational structure and equity ownership of each Debtor entity; (b) to identify all entities in which the Debtors hold a direct or indirect equity interest; and (c) to provide the Court, the United States Trustee, creditors, and all parties in interest with a clear depiction of the corporate relationships among the Debtors and their affiliates, thereby facilitating the orderly and transparent administration of these Chapter 11 cases.

3. On June 20, 2022 (the "Petition Date"), each of the Debtors filed a voluntary petition for relief under Chapter 11 of Title 11 of the United States Code, 11 U.S.C. §§ 101 et seq. (the "Bankruptcy Code"), in the United States Bankruptcy Court for the Northern District of Ohio. Pursuant to an order of this Court entered on even date herewith, the Debtors' Chapter 11 cases are being jointly administered for procedural purposes only under Case No. 22-51247. 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. As of the Petition Date, no trustee, examiner, or official committee of unsecured creditors has been appointed in these cases.

4. This Statement is being filed contemporaneously with the Debtors' voluntary petitions and is intended to satisfy the initial reporting obligation under Rule 2015.3. The Debtors will file supplemental or amended statements as may be required during the pendency of these Chapter 11 cases.

II. IDENTIFICATION OF THE DEBTORS

A. Crestline Packaging Solutions LLC

5. The following information pertains to Crestline Packaging Solutions LLC, the primary operating Debtor in these cases:

Full Legal Name: Crestline Packaging Solutions LLC

Entity Type: Limited Liability Company

Jurisdiction of Organization: State of Ohio

Federal Employer Identification Number (EIN): 31-1782094

Headquarters Address: 4710 Industrial Corridor Drive, Akron, OH 44308

Date of Formation: Crestline was originally formed under the laws of the State of Ohio in 2007 and has operated continuously since its formation.

Business Description: Crestline is a manufacturer of specialty chemical packaging and industrial containment products. Its product lines include high-density polyethylene ("HDPE") drums, intermediate bulk containers ("IBCs"), steel pails, and specialty containment vessels designed for use in the chemical, petrochemical, and agricultural sectors. Crestline serves a diversified customer base of approximately 650 active accounts across the continental United States and exports to select markets in Canada and Mexico. Crestline's products are manufactured to comply with applicable United Nations performance standards, United States Department of Transportation regulations (49 C.F.R. Parts 171–180), and relevant EPA containment specifications.

Number of Employees as of the Petition Date: Approximately 1,420 full-time and part-time employees across four manufacturing facilities and one leased warehouse location.

Fiscal Year 2021 Revenue: Approximately $312.6 million.

B. CPS Holdings Inc.

6. The following information pertains to CPS Holdings Inc., the intermediate holding company and co-Debtor in these cases:

Full Legal Name: CPS Holdings Inc.

Entity Type: Corporation

Jurisdiction of Incorporation: State of Delaware

Federal Employer Identification Number (EIN): 82-3491657

Registered Agent: National Corporate Services, Inc., 1209 Orange Street, Wilmington, DE 19801

Date of Formation: CPS Holdings was formed in 2017 under the laws of the State of Delaware in connection with the leveraged buyout of Crestline by Thornfield Capital Partners LP (described in further detail below). CPS Holdings was organized as the acquisition vehicle and intermediate holding entity through which Thornfield's affiliated investment funds acquired 100% of the equity interests in Crestline.

Business Description: CPS Holdings is an intermediate holding company and serves as the direct parent entity of Crestline Packaging Solutions LLC. CPS Holdings does not conduct any independent business operations, does not employ any persons, and does not maintain any independent office or facility. Its sole material asset is its 100% membership interest in Crestline Packaging Solutions LLC. CPS Holdings was also the issuer of certain debt obligations in connection with the 2017 leveraged buyout transaction described below.

III. EQUITY OWNERSHIP STRUCTURE

A. Ownership of Crestline Packaging Solutions LLC

7. One hundred percent (100%) of the membership interests in Crestline Packaging Solutions LLC are held by CPS Holdings Inc. CPS Holdings is the sole member and direct parent of Crestline. The membership interests are not certificated and are governed by the Amended and Restated Limited Liability Company Agreement of Crestline Packaging Solutions LLC, dated as of October 13, 2017.

8. No other person or entity holds any equity interest, option, warrant, convertible security, profits interest, or other equity-linked security or right in or with respect to Crestline Packaging Solutions LLC. There are no outstanding management incentive units, phantom equity awards, or similar interests that have been issued by Crestline, all such arrangements having been established at the CPS Holdings level as described below.

B. Ownership of CPS Holdings Inc.

9. One hundred percent (100%) of the issued and outstanding shares of common stock of CPS Holdings Inc. are held, directly or through affiliated investment vehicles, by Thornfield Capital Partners LP ("Thornfield" or the "Sponsor"). The following information pertains to Thornfield:

Entity Name: Thornfield Capital Partners LP

Entity Type: Delaware limited partnership

Principal Office: 590 Lexington Avenue, Suite 3200, New York, NY 10022

Managing Partner: Julian Ashford

Approximate Assets Under Management: $4.8 billion (as of December 31, 2021)

Deal Partner (CPS Investment): Rebecca Strand

10. Thornfield acquired 100% of the equity of CPS Holdings Inc. in October 2017 through a leveraged buyout transaction (the "LBO") that closed on October 13, 2017. The LBO was consummated at an aggregate enterprise value of approximately $410.0 million. Thornfield's equity contribution to the transaction was approximately $163.0 million, representing approximately 39.8% of the total enterprise value. The remainder of the acquisition consideration was funded through third-party debt, specifically: (a) borrowings under the First Lien Credit Agreement, dated October 13, 2017, among Crestline Packaging Solutions LLC, as borrower, the lenders party thereto, and Stanton National Bank, as administrative agent (the "First Lien Credit Agreement"), providing for a $210.0 million first lien term loan facility and a $35.0 million revolving credit facility; and (b) the issuance of $60.0 million in aggregate principal amount of 9.75% Senior Secured Second Lien Notes due 2024, issued pursuant to the Indenture dated October 13, 2017, among Crestline Packaging Solutions LLC, as issuer, CPS Holdings Inc., as guarantor, and Continental Fiduciary Trust Company, as trustee (the "Second Lien Notes Indenture").

11. No other person or entity holds any equity interest, option, warrant, convertible security, or other equity-linked security in CPS Holdings Inc. At the time of the LBO, CPS Holdings established a Management Incentive Plan (the "MIP") that authorized the issuance of profits interests and phantom equity awards to certain members of Crestline's senior management. However, as of the Petition Date, all outstanding MIP awards are deeply out-of-the-money and have no economic value. All MIP awards are treated as equity interests in CPS Holdings and are expected to be cancelled under the terms of the Debtors' prepackaged plan of reorganization (as further described in Section IX below).

C. Summary Ownership Chain

12. The following diagram summarizes the equity ownership chain of the Debtors:

Thornfield Capital Partners LP (100% equity holder; non-debtor)

↓ 100% of common stock

CPS Holdings Inc. (intermediate holding company; co-Debtor)

↓ 100% of membership interests

Crestline Packaging Solutions LLC (operating entity; co-Debtor)

13. As set forth above and depicted in the organizational chart attached hereto as Exhibit A, the Debtors' corporate structure is straightforward, consisting of a single-tier holding company structure with one intermediate parent (CPS Holdings) and one operating subsidiary (Crestline), with all equity ultimately controlled by the Sponsor.

IV. ORGANIZATIONAL CHART

14. An organizational chart depicting the complete corporate ownership structure of the Debtors is attached hereto as Exhibit A and is incorporated herein by reference.

15. The organizational chart identifies the following key elements:

(a) Top of Structure: Thornfield Capital Partners LP, a Delaware limited partnership and the non-debtor equity sponsor, is depicted at the top of the organizational chart. Thornfield holds 100% of the issued and outstanding equity of CPS Holdings Inc.

(b) Intermediate Level: CPS Holdings Inc., a Delaware corporation and co-Debtor in these cases (EIN: 82-3491657), is depicted at the intermediate level of the organizational chart. An arrow indicates 100% stock ownership flowing from Thornfield to CPS Holdings.

(c) Operating Level: Crestline Packaging Solutions LLC, an Ohio limited liability company and co-Debtor in these cases (EIN: 31-1782094), is depicted at the operating level of the organizational chart. An arrow indicates 100% membership interest ownership flowing from CPS Holdings to Crestline.

(d) Operating Subsidiaries/Divisions: Crestline does not have any subsidiaries, whether debtor or non-debtor. All four of Crestline's manufacturing facilities (located in Akron, Ohio; Evansville, Indiana; Baton Rouge, Louisiana; and Ravenna, Ohio) are operated directly by Crestline as divisions or operating locations rather than as separate legal entities. These operating locations are depicted on the chart for informational purposes only.

(e) Debtor/Non-Debtor Designation: The organizational chart uses shaded and bordered boxes to denote Debtor entities and unshaded boxes to denote non-debtor entities, ensuring that the distinction between debtor and non-debtor entities is clearly visible.

V. IDENTIFICATION OF OPERATING LOCATIONS

16. Although Crestline operates through four manufacturing facilities and one leased warehouse, none of these locations is held through a subsidiary entity. All facilities are owned or leased directly by Crestline Packaging Solutions LLC. No subsidiary entities hold any leasehold or fee interests in any real property. The Debtors identify the following operating locations for the information of the Court and parties in interest:

(a) Plant 1 (Headquarters): 4710 Industrial Corridor Drive, Akron, OH 44308. This facility serves as Crestline's corporate headquarters and primary manufacturing plant. Plant 1 is dedicated to the production of HDPE drums and related polyethylene packaging products. Approximately 480 employees are based at this location. The facility is owned by Crestline in fee simple.

(b) Plant 2: 2255 Commerce Parkway, Evansville, IN 47725. This facility is dedicated to the manufacturing of intermediate bulk containers (IBCs) and steel pails. Approximately 390 employees are based at this location. The facility is owned by Crestline in fee simple.

(c) Plant 3: 8100 River Road, Baton Rouge, LA 70820. This facility is dedicated to the production of specialty containment vessels, including custom-engineered containment solutions for the petrochemical industry. Approximately 310 employees are based at this location. The facility is owned by Crestline in fee simple.

(d) Plant 4: 1480 State Route 59, Ravenna, OH 44266. This facility houses Crestline's extrusion and secondary processing operations, providing intermediate components and finished secondary processing services to the other three manufacturing plants. Approximately 240 employees are based at this location. The facility is owned by Crestline in fee simple.

(e) Leased Warehouse: 900 Darrow Road, Akron, OH 44305. This facility is a leased warehouse used for finished goods storage and regional distribution. The landlord is Benchmark Real Estate Holdings LLC. The lease is a non-residential real property lease within the meaning of Section 365 of the Bankruptcy Code.

VI. ENTITIES IN WHICH THE DEBTORS HOLD AN INTEREST

17. Except as disclosed herein, neither Crestline Packaging Solutions LLC nor CPS Holdings Inc. holds any direct or indirect equity interest, ownership stake, or investment of any kind in any corporation, limited liability company, partnership, joint venture, trust, or other entity. CPS Holdings' sole material asset is its 100% membership interest in Crestline Packaging Solutions LLC, as disclosed in Section III above.

18. No non-debtor subsidiaries exist. Crestline does not hold any equity interests in any other entity, and does not participate in any joint venture or partnership arrangement. Accordingly, there are no non-debtor affiliates (other than the Sponsor) whose financial condition or operations are material to the administration of these Chapter 11 cases.

VII. PUBLICLY TRADED SECURITIES

19. Neither Debtor has any publicly traded equity securities. CPS Holdings Inc. is a privately held corporation, and all of its issued and outstanding equity is held by Thornfield Capital Partners LP as described in Section III above. Crestline Packaging Solutions LLC is a limited liability company whose sole member is CPS Holdings.

20. For completeness, the Debtors note that Crestline Packaging Solutions LLC is the issuer of $60.0 million in original aggregate principal amount of 9.75% Senior Secured Second Lien Notes due 2024 (CUSIP: 22761TAA3) (the "Second Lien Notes"), issued on October 13, 2017 pursuant to the Second Lien Notes Indenture. As of the Petition Date, $56.0 million in aggregate principal amount of Second Lien Notes remains outstanding, reflecting $4.0 million in open-market repurchases by the Debtors conducted in 2019. Continental Fiduciary Trust Company, located at 101 Barclay Street, New York, NY 10286, serves as indenture trustee under the Second Lien Notes Indenture. The Second Lien Notes are debt instruments, not equity securities, and are disclosed herein solely for the convenience of the Court and parties in interest. The Second Lien Notes may trade in the secondary market among qualified institutional buyers; however, they are not listed on any national securities exchange.

VIII. MANAGEMENT OF THE DEBTORS

A. Officers of Crestline Packaging Solutions LLC

21. As of the Petition Date, the following individuals serve as the principal officers of Crestline Packaging Solutions LLC:

22. The officers of Crestline are responsible for the day-to-day management and operations of Crestline's business, subject to the oversight of CPS Holdings' board of directors and, during the pendency of these Chapter 11 cases, the authority of this Court.

B. Officers and Directors of CPS Holdings Inc.

23. CPS Holdings Inc. is managed by a board of directors, the composition of which is controlled by Thornfield Capital Partners LP as sole equity holder. As of the Petition Date, the board of directors of CPS Holdings consists of the following members:

24. The officers of CPS Holdings overlap substantially with the management of Crestline. Marcus J. Reinholdt serves as President of CPS Holdings, and Dana Kowalski serves as Treasurer of CPS Holdings. Preston Yee serves as Secretary of CPS Holdings.

IX. TREATMENT OF EQUITY UNDER PREPACKAGED PLAN

25. The Debtors note for the Court's information that, in connection with these Chapter 11 cases, the Debtors have entered into a Restructuring Support Agreement dated July 8, 2022 (the "RSA"), with holders representing approximately 78% of the outstanding principal amount of the First Lien Term Loan and approximately 92% of the outstanding principal amount of the Second Lien Notes. The Debtors have also filed a prepackaged plan of reorganization (the "Plan") contemporaneously with these petitions, which has been accepted by the requisite majorities of impaired creditor classes prior to the Petition Date.

26. Under the terms of the RSA and the Plan, all existing equity interests in CPS Holdings Inc. held by Thornfield Capital Partners LP — including all common stock and all awards issued under the Management Incentive Plan — are to be cancelled on the effective date of the Plan (the "Effective Date") without any distribution to existing equity holders, resulting in a zero percent (0%) recovery for the holders of existing equity interests. The cancellation of equity interests is consistent with the absolute priority rule codified in Section 1129(b)(2)(B) of the Bankruptcy Code, as the holders of allowed claims in classes senior to equity will not be paid in full under the Plan.

27. Following the Effective Date, equity interests in reorganized Crestline Packaging Solutions LLC (or its successor entity) will be issued and distributed to creditors in accordance with the terms of the Plan. The specific allocation of new equity interests among creditor classes is set forth in the Plan and the associated Disclosure Statement, which have been filed with this Court and are available for review on the claims agent's website.

X. RESERVATION OF RIGHTS

28. The Debtors reserve all rights to amend, supplement, or modify this Corporate Ownership Statement at any time and from time to time as may be required or appropriate during the pendency of these Chapter 11 cases, including without limitation, to reflect any changes in corporate structure, equity ownership, management, or other matters disclosed herein. Any such amendment or supplement shall be filed with the Court and served upon the United States Trustee and any official committee appointed in these cases. Nothing contained in this Statement shall be deemed an admission or waiver of any kind by any Debtor or any other party, and all rights, claims, defenses, and privileges of each Debtor are expressly preserved.

XI. CONCLUSION

29. The Debtors respectfully submit that this Corporate Ownership Statement, together with the organizational chart attached hereto as Exhibit A, satisfies the requirements of Federal Rule of Bankruptcy Procedure 2015.3, any applicable local rules, and any standing orders of this Court pertaining to the disclosure of corporate ownership information by debtors in Chapter 11 cases.

30. The Debtors respectfully request that the Court accept and docket this Corporate Ownership Statement and grant such other and further relief as may be just and proper.

Dated: June 20, 2022 Cleveland, Ohio

Respectfully submitted,

CALDERWOOD & HARKNESS LLP

By: ________

Colette Whitman (admitted pro hac vice) Nathaniel Bower (admitted pro hac vice) 30 Rockefeller Plaza New York, NY 10112 Telephone: (212) 558-4000 Facsimile: (212) 558-3588

Email: cwhitman@calderwoodharkness.com

Email: nbower@calderwoodharkness.com

— and —

127 Public Square, Suite 4100 Cleveland, OH 44114 Telephone: (216) 479-8500 Facsimile: (216) 479-8780

— and —

KELLNER & HARTWICK LLP Local Co-Counsel

By: ________

Bruce Tatelman (Ohio Bar No. 0067214) 600 Superior Avenue East, Suite 1800 Cleveland, OH 44114 Telephone: (216) 622-8200 Facsimile: (216) 622-8236

Email: btatelman@kellnerhartwick.com

Counsel to Crestline Packaging Solutions LLC and CPS Holdings Inc., Debtors and Debtors in Possession

EXHIBIT A

ORGANIZATIONAL CHART

The following organizational chart depicts the complete corporate ownership structure of Crestline Packaging Solutions LLC and CPS Holdings Inc., as Debtors and Debtors in Possession, together with their equity sponsor. Shaded/bordered boxes denote Debtor entities. Unshaded boxes denote non-debtor entities. All ownership percentages are as of the Petition Date (June 20, 2022). Formed in connection with 2017 leveraged buyout; enterprise value $410.0 million; LBO closing October 13, 2017.

THORNFIELD CAPITAL PARTNERS LP [NON-DEBTOR] Delaware Limited Partnership 590 Lexington Avenue, Suite 3200, New York, NY 10022 Managing Partner: Julian Ashford

╔══════════════════════════════════════════════╗ ║ CPS HOLDINGS INC. [DEBTOR] ║ ║ Delaware Corporation ║ ║ EIN: 82-3491657 ║ ║ Registered Agent: National Corporate ║ ║ Services, Inc. ║ ║ 1209 Orange Street, Wilmington, DE 19801 ║ ║ Intermediate Holding Company ║ ╚══════════════════════════════════════════════╝

╔══════════════════════════════════════════════╗ ║ CRESTLINE PACKAGING SOLUTIONS LLC [DEBTOR] ║ ║ Ohio Limited Liability Company ║ ║ EIN: 31-1782094 ║ ║ 4710 Industrial Corridor Drive ║ ║ Akron, OH 44308 ║ ║ Operating Entity ║ ╚══════════════════════════════════════════════╝

LEGEND: Bordered/shaded boxes (double-lined borders) = Debtor entities filed under Case No. 22-51247 (N.D. Ohio). Unbordered text = Non-Debtor entities. All ownership percentages are as of June 20, 2022 (the Petition Date). No subsidiaries exist below Crestline Packaging Solutions LLC.

In re:	Case No. 22-51247
CRESTLINE PACKAGING SOLUTIONS LLC, et al.,¹	Chapter 11
Debtors.	(Jointly Administered)
Name	Title
Marcus J. Reinholdt	Chief Executive Officer
Dana Kowalski	Chief Financial Officer
Preston Yee	General Counsel and Secretary
Name	Position	Affiliation
Julian Ashford	Chairman of the Board	Managing Partner, Thornfield Capital Partners LP
Rebecca Strand	Director	Deal Partner, Thornfield Capital Partners LP
Marcus J. Reinholdt	Director	CEO, Crestline Packaging Solutions LLC
Andrew Kovarik	Director	Principal, Thornfield Capital Partners LP
Elaine Burgess	Independent Director	N/A

100% Common Stock Ownership

↓

100% Membership Interest Ownership

↓

Operating Divisions / Facilities (Not Separate Legal Entities)

↓

Facility	Location	Primary Operations	Approx. Employees
Plant 1 (HQ)	4710 Industrial Corridor Dr., Akron, OH 44308	HDPE Drum Manufacturing	480
Plant 2	2255 Commerce Pkwy., Evansville, IN 47725	IBC & Steel Pail Manufacturing	390
Plant 3	8100 River Road, Baton Rouge, LA 70820	Specialty Containment Vessels	310
Plant 4	1480 State Route 59, Ravenna, OH 44266	Extrusion & Secondary Processing	240
Warehouse	900 Darrow Road, Akron, OH 44305	Finished Goods Storage / Distribution	—

UNITED STATES BANKRUPTCY COURT NORTHERN DISTRICT OF OHIO EASTERN DIVISION
¹ The Debtors in these jointly administered Chapter 11 cases, together with the last four digits of each Debtor's federal tax identification number, are: Crestline Packaging Solutions LLC (2094) and CPS Holdings Inc. (1657). The location of the Debtors' corporate headquarters and the service address for all Debtors is 4710 Industrial Corridor Drive, Akron, OH 44308.
CORPORATE OWNERSHIP STATEMENT PURSUANT TO FEDERAL RULE OF BANKRUPTCY PROCEDURE 2015.3
Crestline Packaging Solutions LLC ("Crestline" or "CPS") and CPS Holdings Inc. ("CPS Holdings" and, together with Crestline, the "Debtors"), as debtors and debtors in possession, respectfully submit this Corporate Ownership Statement (this "Statement") pursuant to Federal Rule of Bankruptcy Procedure 2015.3 and any applicable local rules of the United States Bankruptcy Court for the Northern District of Ohio (the "Court"), and respectfully represent as follows:
I. INTRODUCTION AND PURPOSE
1. The Debtors file this Corporate Ownership Statement pursuant to Federal Rule of Bankruptcy Procedure 2015.3, which requires each debtor that is a corporation to file periodic reports with the Court identifying all entities in which the debtor holds a controlling or substantial interest, as well as disclosing the organizational structure and equity ownership of each debtor entity. This Statement is also filed in accordance with any applicable provisions of the Local Bankruptcy Rules for the Northern District of Ohio.
2. The purpose of this Statement is threefold: (a) to disclose the organizational structure and equity ownership of each Debtor entity; (b) to identify all entities in which the Debtors hold a direct or indirect equity interest; and (c) to provide the Court, the United States Trustee, creditors, and all parties in interest with a clear depiction of the corporate relationships among the Debtors and their affiliates, thereby facilitating the orderly and transparent administration of these Chapter 11 cases.
3. On June 20, 2022 (the "Petition Date"), each of the Debtors filed a voluntary petition for relief under Chapter 11 of Title 11 of the United States Code, 11 U.S.C. §§ 101 et seq. (the "Bankruptcy Code"), in the United States Bankruptcy Court for the Northern District of Ohio. Pursuant to an order of this Court entered on even date herewith, the Debtors' Chapter 11 cases are being jointly administered for procedural purposes only under Case No. 22-51247. 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. As of the Petition Date, no trustee, examiner, or official committee of unsecured creditors has been appointed in these cases.
4. This Statement is being filed contemporaneously with the Debtors' voluntary petitions and is intended to satisfy the initial reporting obligation under Rule 2015.3. The Debtors will file supplemental or amended statements as may be required during the pendency of these Chapter 11 cases.
II. IDENTIFICATION OF THE DEBTORS
A. Crestline Packaging Solutions LLC
5. The following information pertains to Crestline Packaging Solutions LLC, the primary operating Debtor in these cases:
Full Legal Name: Crestline Packaging Solutions LLC
Entity Type: Limited Liability Company
Jurisdiction of Organization: State of Ohio
Federal Employer Identification Number (EIN): 31-1782094
Headquarters Address: 4710 Industrial Corridor Drive, Akron, OH 44308
Date of Formation: Crestline was originally formed under the laws of the State of Ohio in 2007 and has operated continuously since its formation.
Business Description: Crestline is a manufacturer of specialty chemical packaging and industrial containment products. Its product lines include high-density polyethylene ("HDPE") drums, intermediate bulk containers ("IBCs"), steel pails, and specialty containment vessels designed for use in the chemical, petrochemical, and agricultural sectors. Crestline serves a diversified customer base of approximately 650 active accounts across the continental United States and exports to select markets in Canada and Mexico. Crestline's products are manufactured to comply with applicable United Nations performance standards, United States Department of Transportation regulations (49 C.F.R. Parts 171–180), and relevant EPA containment specifications.
Number of Employees as of the Petition Date: Approximately 1,420 full-time and part-time employees across four manufacturing facilities and one leased warehouse location.
Fiscal Year 2021 Revenue: Approximately $312.6 million.
B. CPS Holdings Inc.
6. The following information pertains to CPS Holdings Inc., the intermediate holding company and co-Debtor in these cases:
Full Legal Name: CPS Holdings Inc.
Entity Type: Corporation
Jurisdiction of Incorporation: State of Delaware
Federal Employer Identification Number (EIN): 82-3491657
Registered Agent: National Corporate Services, Inc., 1209 Orange Street, Wilmington, DE 19801
Date of Formation: CPS Holdings was formed in 2017 under the laws of the State of Delaware in connection with the leveraged buyout of Crestline by Thornfield Capital Partners LP (described in further detail below). CPS Holdings was organized as the acquisition vehicle and intermediate holding entity through which Thornfield's affiliated investment funds acquired 100% of the equity interests in Crestline.
Business Description: CPS Holdings is an intermediate holding company and serves as the direct parent entity of Crestline Packaging Solutions LLC. CPS Holdings does not conduct any independent business operations, does not employ any persons, and does not maintain any independent office or facility. Its sole material asset is its 100% membership interest in Crestline Packaging Solutions LLC. CPS Holdings was also the issuer of certain debt obligations in connection with the 2017 leveraged buyout transaction described below.
III. EQUITY OWNERSHIP STRUCTURE
A. Ownership of Crestline Packaging Solutions LLC
7. One hundred percent (100%) of the membership interests in Crestline Packaging Solutions LLC are held by CPS Holdings Inc. CPS Holdings is the sole member and direct parent of Crestline. The membership interests are not certificated and are governed by the Amended and Restated Limited Liability Company Agreement of Crestline Packaging Solutions LLC, dated as of October 13, 2017.
8. No other person or entity holds any equity interest, option, warrant, convertible security, profits interest, or other equity-linked security or right in or with respect to Crestline Packaging Solutions LLC. There are no outstanding management incentive units, phantom equity awards, or similar interests that have been issued by Crestline, all such arrangements having been established at the CPS Holdings level as described below.
B. Ownership of CPS Holdings Inc.
9. One hundred percent (100%) of the issued and outstanding shares of common stock of CPS Holdings Inc. are held, directly or through affiliated investment vehicles, by Thornfield Capital Partners LP ("Thornfield" or the "Sponsor"). The following information pertains to Thornfield:
Entity Name: Thornfield Capital Partners LP
Entity Type: Delaware limited partnership
Principal Office: 590 Lexington Avenue, Suite 3200, New York, NY 10022
Managing Partner: Julian Ashford
Approximate Assets Under Management: $4.8 billion (as of December 31, 2021)
Deal Partner (CPS Investment): Rebecca Strand
10. Thornfield acquired 100% of the equity of CPS Holdings Inc. in October 2017 through a leveraged buyout transaction (the "LBO") that closed on October 13, 2017. The LBO was consummated at an aggregate enterprise value of approximately $410.0 million. Thornfield's equity contribution to the transaction was approximately $163.0 million, representing approximately 39.8% of the total enterprise value. The remainder of the acquisition consideration was funded through third-party debt, specifically: (a) borrowings under the First Lien Credit Agreement, dated October 13, 2017, among Crestline Packaging Solutions LLC, as borrower, the lenders party thereto, and Stanton National Bank, as administrative agent (the "First Lien Credit Agreement"), providing for a $210.0 million first lien term loan facility and a $35.0 million revolving credit facility; and (b) the issuance of $60.0 million in aggregate principal amount of 9.75% Senior Secured Second Lien Notes due 2024, issued pursuant to the Indenture dated October 13, 2017, among Crestline Packaging Solutions LLC, as issuer, CPS Holdings Inc., as guarantor, and Continental Fiduciary Trust Company, as trustee (the "Second Lien Notes Indenture").
11. No other person or entity holds any equity interest, option, warrant, convertible security, or other equity-linked security in CPS Holdings Inc. At the time of the LBO, CPS Holdings established a Management Incentive Plan (the "MIP") that authorized the issuance of profits interests and phantom equity awards to certain members of Crestline's senior management. However, as of the Petition Date, all outstanding MIP awards are deeply out-of-the-money and have no economic value. All MIP awards are treated as equity interests in CPS Holdings and are expected to be cancelled under the terms of the Debtors' prepackaged plan of reorganization (as further described in Section IX below).
C. Summary Ownership Chain
12. The following diagram summarizes the equity ownership chain of the Debtors:
Thornfield Capital Partners LP (100% equity holder; non-debtor)
↓ 100% of common stock
CPS Holdings Inc. (intermediate holding company; co-Debtor)
↓ 100% of membership interests
Crestline Packaging Solutions LLC (operating entity; co-Debtor)
13. As set forth above and depicted in the organizational chart attached hereto as Exhibit A, the Debtors' corporate structure is straightforward, consisting of a single-tier holding company structure with one intermediate parent (CPS Holdings) and one operating subsidiary (Crestline), with all equity ultimately controlled by the Sponsor.
IV. ORGANIZATIONAL CHART
14. An organizational chart depicting the complete corporate ownership structure of the Debtors is attached hereto as Exhibit A and is incorporated herein by reference.
15. The organizational chart identifies the following key elements:
(a) Top of Structure: Thornfield Capital Partners LP, a Delaware limited partnership and the non-debtor equity sponsor, is depicted at the top of the organizational chart. Thornfield holds 100% of the issued and outstanding equity of CPS Holdings Inc.
(b) Intermediate Level: CPS Holdings Inc., a Delaware corporation and co-Debtor in these cases (EIN: 82-3491657), is depicted at the intermediate level of the organizational chart. An arrow indicates 100% stock ownership flowing from Thornfield to CPS Holdings.
(c) Operating Level: Crestline Packaging Solutions LLC, an Ohio limited liability company and co-Debtor in these cases (EIN: 31-1782094), is depicted at the operating level of the organizational chart. An arrow indicates 100% membership interest ownership flowing from CPS Holdings to Crestline.
(d) Operating Subsidiaries/Divisions: Crestline does not have any subsidiaries, whether debtor or non-debtor. All four of Crestline's manufacturing facilities (located in Akron, Ohio; Evansville, Indiana; Baton Rouge, Louisiana; and Ravenna, Ohio) are operated directly by Crestline as divisions or operating locations rather than as separate legal entities. These operating locations are depicted on the chart for informational purposes only.
(e) Debtor/Non-Debtor Designation: The organizational chart uses shaded and bordered boxes to denote Debtor entities and unshaded boxes to denote non-debtor entities, ensuring that the distinction between debtor and non-debtor entities is clearly visible.
V. IDENTIFICATION OF OPERATING LOCATIONS
16. Although Crestline operates through four manufacturing facilities and one leased warehouse, none of these locations is held through a subsidiary entity. All facilities are owned or leased directly by Crestline Packaging Solutions LLC. No subsidiary entities hold any leasehold or fee interests in any real property. The Debtors identify the following operating locations for the information of the Court and parties in interest:
(a) Plant 1 (Headquarters): 4710 Industrial Corridor Drive, Akron, OH 44308. This facility serves as Crestline's corporate headquarters and primary manufacturing plant. Plant 1 is dedicated to the production of HDPE drums and related polyethylene packaging products. Approximately 480 employees are based at this location. The facility is owned by Crestline in fee simple.
(b) Plant 2: 2255 Commerce Parkway, Evansville, IN 47725. This facility is dedicated to the manufacturing of intermediate bulk containers (IBCs) and steel pails. Approximately 390 employees are based at this location. The facility is owned by Crestline in fee simple.
(c) Plant 3: 8100 River Road, Baton Rouge, LA 70820. This facility is dedicated to the production of specialty containment vessels, including custom-engineered containment solutions for the petrochemical industry. Approximately 310 employees are based at this location. The facility is owned by Crestline in fee simple.
(d) Plant 4: 1480 State Route 59, Ravenna, OH 44266. This facility houses Crestline's extrusion and secondary processing operations, providing intermediate components and finished secondary processing services to the other three manufacturing plants. Approximately 240 employees are based at this location. The facility is owned by Crestline in fee simple.
(e) Leased Warehouse: 900 Darrow Road, Akron, OH 44305. This facility is a leased warehouse used for finished goods storage and regional distribution. The landlord is Benchmark Real Estate Holdings LLC. The lease is a non-residential real property lease within the meaning of Section 365 of the Bankruptcy Code.
VI. ENTITIES IN WHICH THE DEBTORS HOLD AN INTEREST
17. Except as disclosed herein, neither Crestline Packaging Solutions LLC nor CPS Holdings Inc. holds any direct or indirect equity interest, ownership stake, or investment of any kind in any corporation, limited liability company, partnership, joint venture, trust, or other entity. CPS Holdings' sole material asset is its 100% membership interest in Crestline Packaging Solutions LLC, as disclosed in Section III above.
18. No non-debtor subsidiaries exist. Crestline does not hold any equity interests in any other entity, and does not participate in any joint venture or partnership arrangement. Accordingly, there are no non-debtor affiliates (other than the Sponsor) whose financial condition or operations are material to the administration of these Chapter 11 cases.
VII. PUBLICLY TRADED SECURITIES
19. Neither Debtor has any publicly traded equity securities. CPS Holdings Inc. is a privately held corporation, and all of its issued and outstanding equity is held by Thornfield Capital Partners LP as described in Section III above. Crestline Packaging Solutions LLC is a limited liability company whose sole member is CPS Holdings.
20. For completeness, the Debtors note that Crestline Packaging Solutions LLC is the issuer of $60.0 million in original aggregate principal amount of 9.75% Senior Secured Second Lien Notes due 2024 (CUSIP: 22761TAA3) (the "Second Lien Notes"), issued on October 13, 2017 pursuant to the Second Lien Notes Indenture. As of the Petition Date, $56.0 million in aggregate principal amount of Second Lien Notes remains outstanding, reflecting $4.0 million in open-market repurchases by the Debtors conducted in 2019. Continental Fiduciary Trust Company, located at 101 Barclay Street, New York, NY 10286, serves as indenture trustee under the Second Lien Notes Indenture. The Second Lien Notes are debt instruments, not equity securities, and are disclosed herein solely for the convenience of the Court and parties in interest. The Second Lien Notes may trade in the secondary market among qualified institutional buyers; however, they are not listed on any national securities exchange.
VIII. MANAGEMENT OF THE DEBTORS
A. Officers of Crestline Packaging Solutions LLC
21. As of the Petition Date, the following individuals serve as the principal officers of Crestline Packaging Solutions LLC:
22. The officers of Crestline are responsible for the day-to-day management and operations of Crestline's business, subject to the oversight of CPS Holdings' board of directors and, during the pendency of these Chapter 11 cases, the authority of this Court.
B. Officers and Directors of CPS Holdings Inc.
23. CPS Holdings Inc. is managed by a board of directors, the composition of which is controlled by Thornfield Capital Partners LP as sole equity holder. As of the Petition Date, the board of directors of CPS Holdings consists of the following members:
24. The officers of CPS Holdings overlap substantially with the management of Crestline. Marcus J. Reinholdt serves as President of CPS Holdings, and Dana Kowalski serves as Treasurer of CPS Holdings. Preston Yee serves as Secretary of CPS Holdings.
IX. TREATMENT OF EQUITY UNDER PREPACKAGED PLAN
25. The Debtors note for the Court's information that, in connection with these Chapter 11 cases, the Debtors have entered into a Restructuring Support Agreement dated July 8, 2022 (the "RSA"), with holders representing approximately 78% of the outstanding principal amount of the First Lien Term Loan and approximately 92% of the outstanding principal amount of the Second Lien Notes. The Debtors have also filed a prepackaged plan of reorganization (the "Plan") contemporaneously with these petitions, which has been accepted by the requisite majorities of impaired creditor classes prior to the Petition Date.
26. Under the terms of the RSA and the Plan, all existing equity interests in CPS Holdings Inc. held by Thornfield Capital Partners LP — including all common stock and all awards issued under the Management Incentive Plan — are to be cancelled on the effective date of the Plan (the "Effective Date") without any distribution to existing equity holders, resulting in a zero percent (0%) recovery for the holders of existing equity interests. The cancellation of equity interests is consistent with the absolute priority rule codified in Section 1129(b)(2)(B) of the Bankruptcy Code, as the holders of allowed claims in classes senior to equity will not be paid in full under the Plan.
27. Following the Effective Date, equity interests in reorganized Crestline Packaging Solutions LLC (or its successor entity) will be issued and distributed to creditors in accordance with the terms of the Plan. The specific allocation of new equity interests among creditor classes is set forth in the Plan and the associated Disclosure Statement, which have been filed with this Court and are available for review on the claims agent's website.
X. RESERVATION OF RIGHTS
28. The Debtors reserve all rights to amend, supplement, or modify this Corporate Ownership Statement at any time and from time to time as may be required or appropriate during the pendency of these Chapter 11 cases, including without limitation, to reflect any changes in corporate structure, equity ownership, management, or other matters disclosed herein. Any such amendment or supplement shall be filed with the Court and served upon the United States Trustee and any official committee appointed in these cases. Nothing contained in this Statement shall be deemed an admission or waiver of any kind by any Debtor or any other party, and all rights, claims, defenses, and privileges of each Debtor are expressly preserved.
XI. CONCLUSION
29. The Debtors respectfully submit that this Corporate Ownership Statement, together with the organizational chart attached hereto as Exhibit A, satisfies the requirements of Federal Rule of Bankruptcy Procedure 2015.3, any applicable local rules, and any standing orders of this Court pertaining to the disclosure of corporate ownership information by debtors in Chapter 11 cases.
30. The Debtors respectfully request that the Court accept and docket this Corporate Ownership Statement and grant such other and further relief as may be just and proper.
Dated: June 20, 2022 Cleveland, Ohio
Respectfully submitted,
CALDERWOOD & HARKNESS LLP
By: ________
Colette Whitman (admitted pro hac vice) Nathaniel Bower (admitted pro hac vice) 30 Rockefeller Plaza New York, NY 10112 Telephone: (212) 558-4000 Facsimile: (212) 558-3588
Email: cwhitman@calderwoodharkness.com
Email: nbower@calderwoodharkness.com
— and —
127 Public Square, Suite 4100 Cleveland, OH 44114 Telephone: (216) 479-8500 Facsimile: (216) 479-8780
— and —
KELLNER & HARTWICK LLP Local Co-Counsel
By: ________
Bruce Tatelman (Ohio Bar No. 0067214) 600 Superior Avenue East, Suite 1800 Cleveland, OH 44114 Telephone: (216) 622-8200 Facsimile: (216) 622-8236
Email: btatelman@kellnerhartwick.com
Counsel to Crestline Packaging Solutions LLC and CPS Holdings Inc., Debtors and Debtors in Possession
EXHIBIT A
ORGANIZATIONAL CHART
The following organizational chart depicts the complete corporate ownership structure of Crestline Packaging Solutions LLC and CPS Holdings Inc., as Debtors and Debtors in Possession, together with their equity sponsor. Shaded/bordered boxes denote Debtor entities. Unshaded boxes denote non-debtor entities. All ownership percentages are as of the Petition Date (June 20, 2022). Formed in connection with 2017 leveraged buyout; enterprise value $410.0 million; LBO closing October 13, 2017.
THORNFIELD CAPITAL PARTNERS LP [NON-DEBTOR] Delaware Limited Partnership 590 Lexington Avenue, Suite 3200, New York, NY 10022 Managing Partner: Julian Ashford
╔══════════════════════════════════════════════╗ ║ CPS HOLDINGS INC. [DEBTOR] ║ ║ Delaware Corporation ║ ║ EIN: 82-3491657 ║ ║ Registered Agent: National Corporate ║ ║ Services, Inc. ║ ║ 1209 Orange Street, Wilmington, DE 19801 ║ ║ Intermediate Holding Company ║ ╚══════════════════════════════════════════════╝
╔══════════════════════════════════════════════╗ ║ CRESTLINE PACKAGING SOLUTIONS LLC [DEBTOR] ║ ║ Ohio Limited Liability Company ║ ║ EIN: 31-1782094 ║ ║ 4710 Industrial Corridor Drive ║ ║ Akron, OH 44308 ║ ║ Operating Entity ║ ╚══════════════════════════════════════════════╝
LEGEND: Bordered/shaded boxes (double-lined borders) = Debtor entities filed under Case No. 22-51247 (N.D. Ohio). Unbordered text = Non-Debtor entities. All ownership percentages are as of June 20, 2022 (the Petition Date). No subsidiaries exist below Crestline Packaging Solutions LLC.
In re: | Case No. 22-51247
CRESTLINE PACKAGING SOLUTIONS LLC, et al.,¹ | Chapter 11
Debtors. | (Jointly Administered)
Name | Title
Marcus J. Reinholdt | Chief Executive Officer
Dana Kowalski | Chief Financial Officer
Preston Yee | General Counsel and Secretary
Name | Position | Affiliation
Julian Ashford | Chairman of the Board | Managing Partner, Thornfield Capital Partners LP
Rebecca Strand | Director | Deal Partner, Thornfield Capital Partners LP
Marcus J. Reinholdt | Director | CEO, Crestline Packaging Solutions LLC
Andrew Kovarik | Director | Principal, Thornfield Capital Partners LP
Elaine Burgess | Independent Director | N/A
100% Common Stock Ownership
↓
100% Membership Interest Ownership
↓
Operating Divisions / Facilities (Not Separate Legal Entities)
↓
Facility | Location | Primary Operations | Approx. Employees
Plant 1 (HQ) | 4710 Industrial Corridor Dr., Akron, OH 44308 | HDPE Drum Manufacturing | 480
Plant 2 | 2255 Commerce Pkwy., Evansville, IN 47725 | IBC & Steel Pail Manufacturing | 390
Plant 3 | 8100 River Road, Baton Rouge, LA 70820 | Specialty Containment Vessels | 310
Plant 4 | 1480 State Route 59, Ravenna, OH 44266 | Extrusion & Secondary Processing | 240
Warehouse | 900 Darrow Road, Akron, OH 44305 | Finished Goods Storage / Distribution | —