Opinion
Case No. Case No. 01-60386, Chapter 11, Procedurally Consolidated
March 4, 2002
Counsel for the Debtors: Bruce H. Matson, Esquire (Va. Bar No. 22874), Christopher A. Jones, Esquire (Va. Bar No 40064), John R. Bollinger, Esquire (Va Bar No. 46672) and Leclair Ryan. A Professional Corporation Richmond, Virginia.
FINAL ORDER APPROVING POST-PETITION FINANCING OF INSURANCE PREMIUMS
This matter came before the Court upon the motion of the above-captioned debtors and debtors-in-possession (collectively, the "Debtors") for authority to obtain post-petition financing of insurance premiums (the "Motion"). It appearing to the Court that the Debtors and AFCO Corp. ("AFCO") have reached an agreement pursuant to which AFCO will provide certain post petition financing of insurance premiums (the "Post-Petition Financing") to the Debtors, pursuant to 11 U.S.C. § 364,
It is FOUND, DETERMINED, ORDERED and ADJUDGED, that:
1. This Court has jurisdiction over these proceedings and the parties and property affected hereby pursuant to 28 U.S.C. § 157 (b) and 1334.
2. Capitalized terms not otherwise defined herein shall have the meanings given to them in the Motion.
3. The Court entered an Interim Order Approving Post-Petition Financing of Insurance Premiums (the "Interim Order") on February 11, 2002 and no objections have been filed to the Motion, the Interim Order or to the entry of this Order
4. The Post-Petition Financing is necessary to allow the Debtors to operate their business and manage their assets in pursuit of a plan in accordance with Chapter 11 of the Bankruptcy Code.
5. The Debtor is hereby authorized to enter into a Premium Finance Agreement (the "Financing Agreement") with AFCO, which Financing Agreement provides for the financing of the New Insurance premiums to be paid for the Debtors' New Insurance Policies.
6. The Debtors are hereby directed to pay AFCO all sums due under the Financing Agreement.
7. The full rights of AFCO pursuant to the Financing Agreement and controlling state law will be and hereby are fully preserved and protected, and are and shall remain unimpaired by the pendency of the bankruptcy case or any subsequent conversion of this proceeding to a Chapter 7 or any subsequent appointment of a trustee.
8. In any event that the Debtors default upon any of the terms of the Financing Agreement, AFCO may exercise such rights as it may otherwise have under state law, but for the pendency of this proceeding and, without the necessity of further application to this court, cancel all insurance policies listed on the Financing Agreement or any amendment thereto, and receive and apply all unearned insurance premiums to the account of the Debtors. In the event that, after such application of unearned premiums, any sums still remain due to AFCO, such deficiency shall be deemed an administrative expense of the Debtors' estates. AFCO shall provide notice of intent to cancel the policies and of any right to cure to counsel for the Official Committee of Unsecured Creditors, to all parties required by Virginia law and the Financing Agreement, and, via regular mail, to the following:
Cynthia Tucker Bay View Franchise Mortgage Acceptance Company 108 Corporate Park Drive, Suite 301 White Plains, New York 10604
J.P. Morgan Chase Co. The Chase Manhattan Bank 380 Madison Avenue 9th Floor New York, New York 10017-2591 Attention: John P. McDonagh
McLane Mid Atlantic c/o Michael P. Falzone, Esquire Hirschler, Fleischer, Weinberg, et al. 701 East Byrd Street, P. 0. Box 500 Richmond Virginia 23218-0500
McLane Company, Inc. do Gregory G. Hesse, Esquire Jenkens Gilchrist 1445 Ross Avenue, Suite 3200 Dallas, Texas 75202-2799
Lehman Brothers do Jeffrey L. Schwartz, Esquire Hahn Hessen LLP 350 Fifth Avenue New York, New York 10118-0075
Robert B. Van Arsdale, Esquire Acting, Assistant U.S. Trustee Office of the United States Trustee 11 So. 12th Street, Suite 224 Richmond, Virginia 23219
9. The notice given by the Debtors of the Motion and the Interim Order constitutes due and sufficient notice of the Post-Petition Financing.
10. The provisions of this Order shall be self-executing. Neither AFCO nor the Debtors shall be required to take any action or obtain any additional Orders to enjoy the benefits and/or protections of this Order.
11. The terms of this Order are final and modify and supplement the terms of the Interim Order.
12. The Debtors shall immediately serve a copy of this Order on all parties required and in the manner required by the Administrative Order Establishing Notice, Case Management and Hearing Procedures (the "Administrative Order") entered in this bankruptcy case on March 9, 2001.