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RON BENDER (SBN 143364) JACQUELINE L. RODRIGUEZ (SBN 198838) TODD M. ARNOLD (SBN 221868) JOHN-PATRICK M. FRITZ (SBN 245240) LEVENE, NEALE, BENDER, RANKIN & BRILL L.L.P. 10250 Constellation Boulevard, Suite 1700 Los Angeles, California 90067 Telephone: (310) 229-1234; Facsimile: (310) 229-1244 Email: rb@lnbrb.com; jlr@lnbrb.com; tma@lnbrb.com; jpf@lnbrb.com
Attorneys for Chapter 11 Debtors and Debtors in Possession UNITED STATES BANKRUPTCY COURT CENTRAL DISTRICT OF CALIFORNIA (SANTA ANA DIVISION) In re: WESTCLIFF MEDICAL LABORATORIES, INC., Debtor. _______________________________ BIOLABS, INC., Debtor. _______________________________ Affects Both Debtors Affects WESTCLIFF MEDICAL LABORATORIES, INC. only Affects BIOLABS, INC. only Lead Case No. 8:10-bk-16743-TA Jointly Administered with Case No. 8:10-bk-16746-TA Chapter 11 Cases ORDER PURSUANT TO 11 U.S.C. 105 AND 363 AUTHORIZING ON A FINAL BASIS FOR A THIRD INTERIM PERIOD FROM JUNE 24, 2010, TO AND THROUGH JULY 31, 2010, THE DEBTORS TO (A) EMPLOY AND RETAIN FTI CONSULTING, INC. TO PROVIDE CHIEF RESTRUCTURING OFFICER AND TEMPORARY EMPLOYEES, AND (B) TO DESIGNATE MATTHEW PAKKALA AS CHIEF RESTRUCTURING OFFICER Court Scheduled Hearing: Date: June 23, 2010 Time: 10:00 a.m. Place: Courtroom 5B 411 West Fourth Street Santa Ana, CA 92701
Case 8:10-bk-16743-TA
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Upon
consideration
of
the
Debtors
seeking
authorization, pursuant to sections 11 U.S.C. 105 and 363 of chapter 11 of title 11 of the United States Code sections 101 et seq. (the Bankruptcy Code) authorizing the Debtors to (A)
employ and retain FTI Consulting, Inc. (FTI) to provide a Chief Restructuring designate Officer and temporary (Pakkala) employees as the and (B) to
Matthew
Pakkala
Debtors
Chief
Restructuring Officer, nunc pro tunc to May 19, 2010; and upon consideration of the Declaration of Robert E. Whalen (the Whalen Declaration), the Declaration of Matthew Pakkala (the Pakkala Declaration), the FTI Engagement Contract (attached as Exhibit A to the Application) and the filed with and in support based of on the the
Application,
Court
being
satisfied,
representations made in the Application, the Pakkala Declaration, and the Whalen Declaration, that FTI does not represent or hold any interest adverse to the Debtors or the Debtors estates with respect to the matters upon which it is to be engaged and is sufficiently disinterested as that term is defined under
101(14) of the Bankruptcy Code, as modified by 1107(b) of the Bankruptcy Code, and that the Debtors continued employment of FTI and Pakkala is necessary and in the best interests of the Debtors, the Debtors estates, their creditors, and all parties in interest and such continued employment is supported by the Official Committee of Unsecured Creditors (the Committee); and it appearing that due notice of the Application has been provided and no other or further notice need be provided; and the Court
1
Unless otherwise defined herein, each capitalized term shall have the meaning ascribed to such term in the Application.
Case 8:10-bk-16743-TA
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having heard the evidence and statements of counsel regarding the Application and having determined that the legal and factual
bases set forth in the Application, the Pakkala Declaration, and the Whalen Declaration establish just cause for the relief
granted herein; it is hereby ORDERED that the Application is GRANTED to the extent provided herein; and it is further ORDERED that, pursuant to Bankruptcy Code 363, the Debtors are authorized to continue to retain and employ FTI and Pakkala on a final basis for an interim period through July 31 , 2010, on the terms and conditions set forth in the Application, the Engagement Contract, and the Pakkala Declaration, subject to the following amendments to such terms: a. In the event the Debtors seek to have FTI personnel assume additional executive officer positions that are different than the positions disclosed in the
Application, or to materially change the terms of the engagement by modifying the functions of the executive officer personnel, a shall be filed. b. No principal, employee, or independent contractor of FTI and its affiliates shall serve as a director of the Debtors during the pendency of the Chapter 11 Cases. c. For Temporary Employees providing services at an hourly rate, FTI shall file with the U.S. Trustee and the Committee, reports of compensation earned and expenses incurred contain on a quarterly charts basis. which Such reports the shall motion to modify the retention
summary
describe
services
Case 8:10-bk-16743-TA
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provided,
identify
the
compensation
earned
by
each
Temporary Employee and itemize the expenses incurred. Time records shall (i) be time appended entries to the reports, the
(ii) contain
detailed
describing
task(s) performed, and (iii) be organized by project category. Where personnel are providing services at an
hourly rate, the time entries shall identify the time spent completing each task in 1/10/hour increments and the corresponding charge (time multiplied by hourly
as executive officers of the Debtors providing services at a flat monthly rate, time entries are not
required.
by the Court in the event an objection is filed by the United States Trustee or the Committee. The Debtors are permitted to indemnify those persons serving as executive officers on the same terms as
provided to the Debtors other officers and directors under the corporate bylaws and applicable state law, along with insurance coverage under the Debtors D&O policies. There shall be no indemnification of FTI or its
affiliates. For a period of three years after the conclusion of the engagement, neither FTI nor any of its affiliates shall make any investments in the Debtors or Reorganized
Debtors.
Case 8:10-bk-16743-TA
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g.
FTI shall disclose any and all facts that may have a bearing on whether the firm, its affiliates, and/or any individuals working on the engagement hold or represent any interest adverse to the Debtors, their creditors, or other parties-in-interest. identified in this The obligation is to a
disclose
subparagraph
continuing obligation. and it is further ORDERED that the Debtors are authorized to continue to
designate Pakkala as the Chief Restructuring Officer on a final basis for an interim period to and through July 31 , 2010; and it is further ORDERED that the terms and conditions of FTIs retainer set forth in the Engagement Contract are hereby approved on a final basis for an interim period to and through July 31, 2010.
Without further order of this Court, FTI shall be authorized, but not required, in its sole discretion, to (i) hold its retainer and apply it to FTIs final bill for postpetition fees and
expenses incurred during these cases, with any excess then to be refunded to the Debtors estates, or (ii) to apply the retainer to fees and expenses incurred by FTI as FTIs engagement in these cases proceeds; and it is further ORDERED that subject to the foregoing, the Debtors are
authorized to pay FTI in such amounts and at such times as are provided in the Engagement Contract on a final basis for an
interim period as accrued through July 31, 2010 without further order of this Court; and it is further
Case 8:10-bk-16743-TA
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ORDERED
that
the
terms
of
any
continued
employment
of
Pakkala or compensation paid to FTI for any period from and after August 1, 2010 order shall be the into subject by and of a further written the
stipulated
entered
between
Pakkala,
Committee and the Debtors or a further order of the Court if no such stipulated order can be agreed upon; and it is further ORDERED that this Court shall retain jurisdiction over any issues arising from the implementation or interpretation of this Order.
Case 8:10-bk-16743-TA
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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 MATTHEW PAKKALA LEVENE, NEALE, BENDER, RANKIN & BRILL L.L.P. BUCHALTER NEMER, A PROFESSIONAL CORPORATION Dated: June 21, 2010
AGREED:
###
Case 8:10-bk-16743-TA
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In re: WESTCLIFF MEDICAL LABORATORIES, INC., Debtor(s). BIOLABS, INC., Debtor. CHAPTER 11 Case No. 8:10-bk-16743-TA Jointly Administered with Case No. 8:10-bk-16746-TA
A true and correct copy of the foregoing document described as ORDER PURSUANT TO 11 U.S.C. 105 AND 363 AUTHORIZING ON A FINAL BASIS FOR A THIRD INTERIM PERIOD FROM JUNE 24, 2010, TO AND THROUGH JULY 31, 2010, THE DEBTORS TO (A) EMPLOY AND RETAIN FTI CONSULTING, INC. TO PROVIDE CHIEF RESTRUCTURING OFFICER AND TEMPORARY EMPLOYEES, AND (B) TO DESIGNATE MATTHEW PAKKALA AS CHIEF RESTRUCTURING OFFICER will be served or was served (a) on the judge in chambers in the form and manner required by LBR 5005-2(d); and (b) in the manner indicated below: I. TO BE SERVED BY THE COURT VIA NOTICE OF ELECTRONIC FILING (NEF) Pursuant to controlling General Order(s) and Local Bankruptcy Rule(s) (LBR), the foregoing document will be served by the court via NEF and hyperlink to the document. On ___________, 2010, I checked the CM/ECF docket for this bankruptcy case or adversary proceeding and determined that the following person(s) are on the Electronic Mail Notice List to receive NEF transmission at the email address(es) indicated below: Service information continued on attached page II. SERVED BY U.S. MAIL OR OVERNIGHT MAIL(indicate method for each person or entity served): On ________, 2010, I served the following person(s) and/or entity(ies) at the last known address(es) in this bankruptcy case or adversary proceeding by placing a true and correct copy thereof in a sealed envelope in the United States Mail, first class, postage prepaid, and/or with an overnight mail service addressed as follows. Listing the judge here constitutes a declaration that mailing to the judge will be completed no later than 24 hours after the document is filed. Service information continued on attached page III. SERVED BY PERSONAL DELIVERY, FACSIMILE TRANSMISSION OR EMAIL (indicate method for each person or entity served): Pursuant to F.R.Civ.P. 5 and/or controlling LBR, on June 21, 2010, I served the following person(s) and/or entity(ies) by personal delivery, or (for those who consented in writing to such service method), by facsimile transmission and/or email as follows. Listing the judge here constitutes a declaration that personal delivery on the judge will be completed no later than 24 hours after the document is filed. Via Attorney Service Hon. Theodor Albert United States Bankruptcy Court 411 West Fourth Street Santa Ana, CA 92701 Service by E-Mail: Office of the U.S. Trustee Frank.Cadigan@usdoj.gov; nancy.goldenberg@usdoj.gov; Terry.Biers@usdoj.gov Debtors mapakkala@gmail.com Counsel for Committee bseigel@buchalter.com; jgarfinkle@buchalter.com
Case 8:10-bk-16743-TA
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Service information continued on attached page
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I declare under penalty of perjury under the laws of the United States of America that the foregoing is true and correct. June 21, 2010 Date
January 2009
This form is mandatory. It has been approved for use by the United States Bankruptcy Court for the Central District of California.
F 9013-3.1
Case 8:10-bk-16743-TA
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In re: WESTCLIFF MEDICAL LABORATORIES, INC., Debtor(s). BIOLABS, INC., Debtor. CHAPTER 11 Case No. 8:10-bk-16743-TA Jointly Administered with Case No. 8:10-bk-16746-TA
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Case 8:10-bk-16743-TA
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II. SERVED BY THE COURT VIA U.S. MAIL: A copy of this notice and a true copy of this judgment or order was sent by United States Mail, first class, postage prepaid, to the following person(s) and/or entity(ies) at the address(es) indicated below:
Debtor Westcliff Medical Laboratories, Inc. 1821 E. Dyer Road, #100 Santa Ana, CA 92705-0000 Service information continued on attached page III. TO BE SERVED BY THE LODGING PARTY: Within 72 hours after receipt of a copy of this judgment or order which bears an Entered stamp, the party lodging the judgment or order will serve a complete copy bearing an Entered stamp by U.S. Mail, overnight mail, facsimile transmission or email and file a proof of service of the entered order on the following person(s) and/or entity(ies) at the address(es), facsimile transmission number(s) and/or email address(es) indicated below: Service information continued on attached page
This form is mandatory. It has been approved for use by the United States Bankruptcy Court for t he Central District of California.
January 2009
F 9021-1.1
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