APPLICATION OF THE DEBTOR PURSUANT TO BANKRUPTCY … · “Bankruptcy Rules”), and rules 2014-1...

IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - In re: EXIDE TECHNOLOGIES, Debtor.1 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

x : : : : : : : x

Chapter 11 Case No. 13-11482 (KJC) Hrg. Date: July 11, 2013 at 10:00 a.m. (Eastern) Obj. Due: July 3, 2013 at 4:00 p.m. (Eastern)

APPLICATION OF THE DEBTOR PURSUANT TO BANKRUPTCY CODE SECTIONS

327(a) AND 328(a), BANKRUPTCY RULE 2014(a), AND LOCAL BANKRUPTCY RULES 2014-1 AND 2016-2 AUTHORIZING THE EMPLOYMENT AND RETENTION OF SITRICK AND COMPANY AS CORPORATE COMMUNICATIONS AND PUBLIC

RELATIONS CONSULTANTS TO THE DEBTOR NUNC PRO TUNC TO THE PETITION DATE

Exide Technologies (“Exide” or the “Debtor”) hereby submits this application

(the “Application”), pursuant to sections 327(a) and 328(a) of title 11 of the United States Code

(the “Bankruptcy Code”), rule 2014(a) of the Federal Rules of Bankruptcy Procedure (the

“Bankruptcy Rules”), and rules 2014-1 and 2016-2 of the Local Rules of Bankruptcy Practice

and Procedure of the United States Bankruptcy Court for the District of Delaware (the “Local

Bankruptcy Rules”) for the entry of an order, nunc pro tunc to the Petition Date (defined below)

authorizing the employment and retention of Sitrick and Company (“Sitrick”) as corporate

communications and public relations consultants for the Debtor effective as of the date of the

filing of the bankruptcy case. In support of this Application, the Debtor relies upon and

incorporates by reference (a) the Declaration of Brenda Adrian (the “Adrian Declaration”),

which is attached hereto as Exhibit A and (b) the Declaration of Phillip Damaska in Support of 1 The last four digits of the Debtor's taxpayer identification number are 2730. The Debtor’s corporate

headquarters are located at 13000 Deerfield Parkway, Building 200, Milton, Georgia 30004.

Case 13-11482-KJC Doc 149 Filed 06/19/13 Page 1 of 14

2

Chapter 11 Petition and First Day Pleadings (the “First Day Declaration”) (Docket No. 3). In

further support of this Application, the Debtor respectfully represents as follows:

JURISDICTION AND VENUE

1. This Court has jurisdiction to consider this matter pursuant to 28 U.S.C.

§§ 157 and 1334. This is a core proceeding pursuant to 28 U.S.C. § 157(b)(2). Venue is proper

before this Court pursuant to 28 U.S.C. §§ 1408 and 1409.

2. The statutory and procedural predicates for the relief requested in this

Application are sections 327 and 328 of the Bankruptcy Code, Bankruptcy Rules 2014 and 2016,

and Local Bankruptcy Rules 2014-1 and 2016-2(h).

3. Pursuant to Rule 9013-1(f) of the Local Bankruptcy Rules, the Debtor

consents to the entry of a final judgment or order with respect to this Application if it is

determined that this Court would lack Article III jurisdiction to enter such final order or

judgment absent the consent of the of the parties.

BACKGROUND

A. The Chapter 11 Case

4. On June 10, 2013 (the “Petition Date”), the Debtor commenced a case by

filing a petition for relief under chapter 11 of the Bankruptcy Code (the “Chapter 11 Case”).

5. The Debtor continues to operate its business and manage its property as

debtor and debtor in possession pursuant to Bankruptcy Code sections 1107(a) and 1108.

6. On June 18, 2013, the United States Trustee for the District of Delaware

(the “U.S. Trustee”) appointed an Official Committee of Unsecured Creditors (the “Creditors’

Committee”) in the Chapter 11 Case pursuant to Bankruptcy Code section 1102. No trustee or

examiner has been appointed in the Chapter 11 Case.


3

B. The Debtor’s Business

7. The Debtor, Exide, which together with its direct and indirect subsidiaries

(collectively, the “Company”), has operations in more than 80 countries, is a global leader in

stored electrical energy solutions and one of the world’s largest producers and recyclers of lead-

acid batteries.

8. The Company’s four global business groups—Transportation Americas,

Transportation Europe and Rest of World (“ROW”), Industrial Energy Americas, and Industrial

Energy Europe and ROW—provide a comprehensive range of stored electrical energy products

and services for industrial and transportation applications. Additional factual background

information about the Debtor, including its business operations, its corporate and capital

structures, its restructuring efforts, and the events leading to the filing of the Chapter 11 Case, is

set forth in detail in the First Day Declaration.2

RELIEF REQUESTED

9. By this Application, the Debtor seeks entry of an order under Bankruptcy

Code sections 327(a) and 328(a), Bankruptcy Rule 2014, and Local Bankruptcy Rules 2014-1

and 2016-2, authorizing the employment and retention of Sitrick, effective as of the Petition Date,

as their corporate communications and public relations advisors and consultants in the Chapter

11 Case, in accordance with the provisions of that certain engagement letter dated as of April 26,

2013 (the “Engagement Date”), a copy of which is attached to the Adrian Declaration as Exhibit

2 Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the First Day

Declaration.


4

1 (the “Engagement Agreement”),3 to develop, prepare, and implement specific communications

programs, initiatives, and related strategies that will be necessary during the case, as is more

fully described herein.

BASIS FOR RELIEF

10. Under the Engagement Agreement, the Debtor retained Sitrick to evaluate

and advise the Debtor on a variety of corporate communications and public relations issues

deriving from or associated with the Debtor’s efforts to restructure its financial affairs and capital

structure in a sale or reorganization case filed under chapter 11 of the Bankruptcy Code.

11. Since their entry into the Engagement Agreement, the Debtor and Sitrick

have worked closely with respect to the matters set forth in the Engagement Agreement. In

doing so, Sitrick has become uniquely familiar with the Debtor’s business affairs and current

corporate communications and public relations needs. Sitrick’s services are necessary to the

Debtor because Sitrick will be able to assist the Debtor in protecting, retaining, and developing

the goodwill and confidence of a number of constituency groups and stakeholders during the

Chapter 11 Case. The cooperative participation of parties such as employees, partners, clients,

vendors, trade and other creditors, and lenders is essential to the Debtor’s ability to maximize the

value of the estate for the benefit of all parties-in-interest. Accordingly, the Debtor submits that

the retention of Sitrick on the terms and conditions set forth herein is necessary and appropriate,

3 Any references to or summaries of the Engagement Agreement in this Application are qualified by the express

terms of the Engagement Agreement, which shall govern if there is any conflict between the Engagement Agreement and the summaries provided herein. Additionally, any capitalized terms used in this Application and not otherwise defined herein or in the First Day Declaration shall have the meanings ascribed to such terms in the Engagement Agreement.


5

is in the best interests of its estate, creditors, and all other parties in interest, and should be

granted.

12. Sitrick has provided advice and assisted the Debtor in connection with

corporate communications and public relations aspects of its restructuring efforts and has been

instrumental in developing and drafting specific communication materials and related strategy

designed to facilitate the smooth transition of the Debtor’s operations into chapter 11, including

communications to key constituencies.

13. The Debtor is familiar with the professional standing and reputation of

Sitrick. Indeed, the consideration of this professional standing and reputation was a critical

element in the Debtor’s decision to enter into the Engagement Agreement. Among other things,

the Debtor understands that Sitrick has a wealth of experience in providing corporate

communications and public relations advice and consultancy in restructurings and

reorganizations and enjoys an excellent reputation for services it has rendered in large and

complex chapter 11 cases on behalf of debtors and creditors throughout the United States.

14. As described in the Adrian Declaration, Sitrick is a full-service

independent global public relations firm with approximately 50 professionals collaborating

across its Los Angeles, New York, San Francisco, and Washington DC offices. Sitrick has been

ranked as one of the top strategic communications companies in the nation and has emerged as a

leader in corporate reputation management, with extensive experience in both out-of-court

restructurings and complex chapter 11 cases. For example, Sitrick has been retained and

performed services in the Chapter 11 bankruptcy cases of USG Corporation, America West

Airlines, Brazos Sportswear, Inc., Bumble Bee Seafoods, Inc., Eddie Haggar Limited, Inc.,

Burlington Industries, Inc., Peregrine Systems, Inc., Delphi Corp., and others. Sitrick is willing


6

to serve as the Debtor’s communications consultant and to perform the services requested,

subject to this Court’s approval.

15. Sitrick’s services are necessary to the Debtor because Sitrick will be able

to assist the Debtor in protecting, retaining, and developing the goodwill and confidence of a

number of constituency groups and stakeholders during the Chapter 11 Case. In this regard, it is

crucial that the Debtor informs its and its non-debtor affiliates’ employees, customers, vendors,

and suppliers as well as local and state governmental authorities of the effect that the Chapter 11

Case will have on the Debtor’s business and that these communications be tailored appropriately

to each particular constituency. The cooperative participation of parties such as employees,

partners, clients, vendors, trade and other creditors, and lenders is essential to the Debtor’s ability

to maximize the value of the estate for the benefit of all parties-in-interest. Accordingly, the

Debtor submits that the retention of Sitrick on the terms and conditions set forth herein is

necessary and appropriate, is in the best interests of its estate, creditors, and all other parties in

interest, and should be granted.

16. In addition, the Debtor must maintain open lines of communication with

these key constituencies and keep them informed of significant activities in the chapter 11 case

in a timely and effective manner. The Debtor needs experienced corporate communications

consultants to assist them with these communications efforts.

17. Further, the services of Sitrick are also necessary to enable the Debtor to

efficiently and effectively control and address media-related inquiries and matters. Indeed,

inaccurate media reporting may raise a variety of negative issues, which may be significantly

detrimental to the Debtor’s public image and the businesses of its operating subsidiaries,

ultimately affecting or even jeopardizing the successful outcome of the Chapter 11 Case.


7

Accordingly, it is critical for the Debtor to promptly and publicly address misperceptions and the

inaccurate reporting of relevant information. The Debtor needs the assistance of a professional

public relations firm to properly address such media-related inquires and matters.

18. Indeed, since April 26, 2013, Sitrick has worked closely with the Debtor’s

management, creditors, and other professionals and advisors in preparing a communications

strategy in connection with, and otherwise assisting with preparing for, the commencement of

the Chapter 11 Case. As a result of its active engagement in these processes, Sitrick is now

intimately familiar with the Debtor’s business operations and key stakeholders. Sitrick’s

prepetition work for the Debtor has included, but has not been limited to, handling media

inquiries, drafting internal and external communications materials for use with a wide variety of

audiences, and developing a general communications strategy.

19. Consequently, the Debtor believes that Sitrick has developed significant

relevant experience and expertise regarding the Debtor and its current situation and is thus both

well-qualified and uniquely suited to provide the required services in the Chapter 11 Case.

Indeed, if the Debtor was required to retain communications consultant other than Sitrick in

connection with the Chapter 11 Case, the Debtor, its estate, and all parties in interest would be

unduly prejudiced by the time and expenses necessary to familiarize another professional with

the intricacies of the Debtor and its communications needs.

20. For these reasons, Sitrick’s retention is in the best interest of the Debtor,

its estate, and its creditors, and should be approved. Further, the Debtor believes that Sitrick is

well qualified and able to assist the Debtor in a cost-effective, efficient, and timely manner.


8

SCOPE OF SERVICES

21. Under the terms of the Engagement Agreement, Sitrick will provide such

corporate communications and public relations consulting and advisory services as Sitrick and

the Debtor deem appropriate and feasible to advise the Debtor in the course of the chapter 11

cases. Specifically, and subject to further order of this Court, Sitrick will be required to render

various services to the Debtor including, among others, the following:4

(a) Develop and implement communications programs and related strategies and initiatives for communications with the Debtor’s key constituencies (including customers, employees, vendors, bondholders, related key constituencies, and the media) regarding the Debtor’s operations and progress through the chapter 11 process;

(b) Develop public relations initiatives for the Debtor to maintain public confidence and internal morale during the chapter 11 process;

(c) Prepare press releases and other public statements for the Debtor, including statements relating to major chapter 11 events;

(d) Prepare other forms of communication to the Debtor’s key constituencies and the media;

(e) Develop and maintain a website containing communications materials for various constituencies regarding the restructuring; and

(f) Perform such other communications consulting services as may be requested by the Debtor.

TERMS OF RETENTION

22. The Debtor understands that Sitrick intends to apply to this Court for

allowances of compensation and reimbursement of expenses for its services in accordance with

the applicable provisions of the Bankruptcy Code, the Bankruptcy Rules, the Local Rules, orders

4 Capitalized terms not otherwise defined in this paragraph shall have the meanings ascribed to such terms in the

Engagement Agreement.


9

of this Court, and guidelines established by the United States Trustee. The customary hourly

rates, subject to periodic adjustments, charged by Sitrick professionals anticipated to be assigned

to this case are as follows: Brenda Adrian, $625/hour, AnitaMarie Laurie, $625/hour, and Ashley

Cantwell, $235/hour. Sitrick may involve other professionals employed by Sitrick with similar

experience and rates to implement communications strategies as may be necessary from time to

time.

23. The rates charged by Sitrick are comparable to what is generally charged

by other firms of similar stature to Sitrick for comparable engagements, both in and out of

bankruptcy, and represents Sitrick’s standard fee amounts. Sitrick and the Debtor believes that

the foregoing compensation arrangement is both reasonable and market-based and consistent

with Sitrick’s normal and customary billing levels for comparably sized and complex cases, both

in and out-of-court, involving the services to be provided in the chapter 11 case.

24. In addition, the Debtor has agreed to reimburse Sitrick for all reasonable,

documented out of pocket expenses actually incurred by Sitrick (excluding legal fees, expenses,

and disbursements). Sitrick will follow its customary expense reimbursement guidelines and

practices in seeking expense reimbursement from the Debtor.

25. The Debtor paid Sitrick $110,000.00 as an initial retainer (the “Retainer”),

and replenished that amount from time to time prior to the Petition Date. In total, prior to the

Petition Date, the Debtors paid Sitrick $684,755.72 (the “Retainer Amounts”) which Sitrick

applied against Sitrick’s prepetition fees and costs, such that Sitrick did not have any outstanding

and unpaid fees as of the Petition Date. As of the Petition Date, Sitrick had approximately

$42,000.00 remaining and on hand from the total Retainer Amounts which is available for

payment of additional fees and costs incurred postpetition. To the extent the Retainer is


10

insufficient to pay all amounts owed to Sitrick postpetition, subject to Court approval, the Debtor

shall be entitled to pay Sitrick from its operating revenues.

26. Sitrick intends to file interim and final fee applications for the allowance

of compensation for services rendered and reimbursement of expenses incurred in accordance

with applicable provisions of the Bankruptcy Code, the Fee Guidelines, the Bankruptcy Rules,

and any applicable orders of this Court. Such applications will include time records setting forth,

in a summary format, a description of the services rendered by each professional, and the amount

of time spent on each date by each such individual in rendering services on behalf of the Debtor.

Time is billed by Sitrick in increments of one-tenth of an hour. Sitrick will also maintain

detailed records of any actual and necessary costs and expenses incurred in connection with the

services discussed above.

27. Subject to the provisions in the Engagement Agreement, the Debtor is

authorized to indemnify, and shall indemnify, Sitrick in accordance with the Engagement

Agreement for any claim arising from, related to, or in connection with the services provided for,

whether prepetition or postpetition, in the Engagement Agreement;

28. Notwithstanding any provisions of the Engagement Agreement to the

contrary, the Debtor shall have no obligation to indemnify Sitrick or provide contribution or

reimbursement to Sitrick for any claim or expense that is either judicially determined to have

resulted primarily from the reckless or willful misconduct, malpractice, gross negligence, bad

faith, self-dealing, or breach of fiduciary duty of Sitrick.

29. By this Application, the Debtor seeks approval of the Engagement

Agreement.


11

SITRICK’S DISINTERESTEDNESS

30. Sitrick has informed the Debtor that, except as may be set forth in the

Adrian Declaration, it (i) has no connection with the Debtor, its creditors, or other parties in

interest in this case; (ii) does not hold any interest adverse to the Debtor’s estate; and (iii)

believes it is a “disinterested person” as defined within Bankruptcy Code section 101(14).

31. Sitrick has further informed the Debtor that it will conduct an ongoing

review of its files to ensure that no conflicts or other disqualifying circumstances exist or arise.

If any new material facts or relationships are discovered or arise, Sitrick will supplement its

disclosure to this Court.

32. Sitrick has also agreed not to share with any person or firm the

compensation to be paid for professional services rendered in connection with the case.

33. The Debtor believes that Sitrick is not owed any amounts with respect to

its prepetition fees and expenses.

APPLICABLE AUTHORITY

34. Section 327(a) of the Bankruptcy Code provides that a debtor, subject to

court approval: “May employ one or more attorneys, accountants, appraisers, auctioneers, or

other professional persons, that do not hold or represent an interest adverse to the estate, and that

are disinterested persons, to represent or assist . . . in carrying out . . . duties under [the

Bankruptcy Code].” 11 U.S.C. § 327(a).

35. Section 328(a), in turn, provides that employment of a professional person

under section 327 of the Bankruptcy Code may be “on any reasonable terms and conditions of

employment, including on retainer, on an hourly basis, on a fixed or percentage fee basis, or on a

contingent fee basis” subject to later re-evaluation by the court. 11 U.S.C. § 328(a).


12

36. Bankruptcy Rule 2014 requires that an application for retention include:

“[S]pecific facts showing the necessity for the employment, the name of the [firm] to be

employed, the reasons for the selection, the professional services to be rendered, any proposed

arrangement for compensation, and, to the best of the applicant’s knowledge, all of the [firm’s]

connections with the debtor, creditors, any other party in interest, their respective attorneys and

accountants, the United States trustee, or any person employed in the office of the United States

trustee.” Fed. R. Bankr. P. 2014.

37. Sitrick intends to apply to this Court for allowance of compensation and

reimbursement of expenses in accordance with the procedures set forth in the applicable

provisions of the Bankruptcy Code, the Bankruptcy Rules, and the Local Rules, as those

procedures may be modified or supplemented by order of this Court.

38. The terms of Sitrick’s engagement described herein were negotiated by the

Debtor and Sitrick at arm’s length and in good faith. The Debtor respectfully submits that the

indemnification provisions contained herein, viewed in conjunction with the other terms of

Sitrick’s proposed retention, are reasonable and in the best interest of the Debtor, its estate, and

creditors.

NOTICE

39. Notice of this Application will be given to: (i) the Office of the United

States Trustee; (ii) counsel to the agent under the debtor in possession financing; (iii) counsel to

the agent for the Debtor’s prepetition secured lenders; (iv) the indenture trustee for each of the

Debtor’s secured and unsecured outstanding bond issuances; (v) counsel to the unofficial

committee of senior secured noteholders; (vi) proposed counsel to the Creditors’ Committee; and

(vii) all parties entitled to notice pursuant to Bankruptcy Rule 2002. The Debtor submits that no

other or further notice need be provided.


13

NO PRIOR REQUEST

40. No previous request for the relief sought herein has been made to this or

any other court.


14

CONCLUSION

WHEREFORE, the Debtor respectfully requests that the Court enter an order,

substantially in the form annexed hereto, granting the relief requested in the Application and

such other and further relief as may be just and proper.

Dated: June 19, 2013

Exide Technologies

By: /s/ Phillip A. Damaska Name: Phillip A. Damaska Title: Executive Vice President and Chief Financial Officer


IN THE UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF DELAWARE

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

In re:

EXIDE TECHNOLOGIES,

Debtor.1

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

x

:

:

:

:

:

:

:

x

Chapter 11

Case No. 13-11482 (KJC)

Hrg. Date: July 11, 2013 at 10:00 a.m. (Eastern)

Obj. Due: July 3, 2013 at 4:00 p.m. (Eastern)

NOTICE OF APPLICATION OF THE DEBTOR PURSUANT TO BANKRUPTCY

CODE SECTIONS 327(a) AND 328(a), BANKRUPTCY RULE 2014(a), AND LOCAL

BANKRUPTCY RULES 2014-1 AND 2016-2 AUTHORIZING THE EMPLOYMENT

AND RETENTION OF SITRICK AND COMPANY AS CORPORATE

COMMUNICATIONS AND PUBLIC RELATIONS CONSULTANTS TO THE DEBTOR

NUNC PRO TUNC TO THE PETITION DATE

PLEASE TAKE NOTICE that the debtor and debtor in possession in the above-

captioned bankruptcy case (the “Debtor”) filed today the attached Application Of The Debtor

Pursuant To Bankruptcy Code Sections 327(a) And 328(a), Bankruptcy Rule 2014(a), And Local

Bankruptcy Rules 2014-1 And 2016-2 Authorizing The Employment And Retention Of Sitrick

And Company As Corporate Communications And Public Relations Consultants To The Debtor

Nunc Pro Tunc To The Petition Date (the “Application”).

PLEASE TAKE FURTHER NOTICE that a hearing on the Application will be

held on July 11, 2013 at 10:00 a.m. (Eastern) before the Honorable Kevin J. Carey, United

States Bankruptcy Judge for the District of Delaware, in the United States Bankruptcy Court for

the District of Delaware, 5th Floor, Courtroom 5, 824 North Market Street, Wilmington,

Delaware 19801 (“Hearing”).

1 The last four digits of Debtor’s taxpayer identification number are 2730. The Debtor’s corporate headquarters

are located at 13000 Deerfield Parkway, Building 200, Milton, Georgia 30004.

Case 13-11482-KJC Doc 149-1 Filed 06/19/13 Page 1 of 4

2

PLEASE TAKE FURTHER NOTICE that objections, if any, to the Application

or the relief requested therein must be made in writing, filed with the United States Bankruptcy

Court for the District of Delaware (the “Bankruptcy Court”), 824 Market Street, Wilmington,

Delaware 19801, and served so as to be received by the following parties no later than July 3,

2013 at 4:00 p.m. (Eastern): (i) the Debtor, Exide Technologies, 13000 Deerfield Parkway,

Building 200, Milton, Georgia 30004, Attn: Phillip A. Damaska; (ii) proposed counsel to the

Debtor, Skadden, Arps, Slate, Meagher & Flom LLP, Four Times Square, New York, New York

10036, Attn: Kenneth S. Ziman, Esq. and J. Eric Ivester, Esq. and One Rodney Square, P.O. Box

636, Wilmington, Delaware 19899-0636, Attn: Anthony W. Clark, Esq. and 155 N. Wacker

Drive, Chicago, Illinois 60606-1720, Attn: James J. Mazza, Jr.; (iii) counsel to the agent under

the debtor in possession financing, Davis, Polk & Wardwell LLP, 450 Lexington Avenue, New

York, New York 10017, Attn: Damian S. Schaible, Esq. and Richards, Layton & Finger, P.A.,

One Rodney Square, 920 North King Street, Wilmington, Delaware 19801, Attn: Mark D.

Collins, Esq.; (iv) counsel to the agent for the Debtor’s prepetition secured lenders, Greenberg

Traurig, LLP, 3333 Piedmont Road NE, Suite 2500, Atlanta, Georgia 30305, Attn: David B.

Kurzweil, Esq. and 1007 N. Orange St., Suite 1200, Wilmington, Delaware 19801, Attn: Dennis

A. Meloro, Esq.; (v) the indenture trustee for the Debtor’s secured bond issuances, Wells Fargo

Bank, N.A., 7000 Central Parkway NE, Suite 550, Atlanta, Georgia 30328, Attn: Corporate Trust

Services - Exide Technologies; (vi) the indenture trustee for the Debtor’s unsecured bond

issuances, U.S. Bank National Association, Global Corporate Trust Services, 60 Livingston

Ave., EP-MN-WS1D, St. Paul, Minnesota 55107, Attn: Cindy Woodward; (vii) counsel to the

unofficial committee of senior secured noteholders, Paul, Weiss, Rifkind, Wharton & Garrison

LLP, 1285 Avenue of the Americas, New York, New York 10019, Attn: Alice Eaton, Esq. and


3

Young Conaway Stargatt & Taylor, LLP, Rodney Square, 1000 King Street, Wilmington,

Delaware 19801, Attn: Pauline K. Morgan, Esq.; (viii) the Office of the United States Trustee for

the District of Delaware, Office of the United States Trustee, Room 2207, Lockbox 35, 844

North King Street, Wilmington, Delaware 19801, Attn: Mark S. Kenney, Esq.; and (ix) proposed

counsel to the official committee of unsecured creditors. Only objections made in writing and

timely filed and received will be considered by the Bankruptcy Court at the Hearing.


4 717147.01-WILSR01A - MSW

PLEASE TAKE FURTHER NOTICE THAT IF NO OBJECTIONS TO

THE APPLICATION ARE TIMELY FILED AND RECEIVED IN ACCORDANCE

WITH THE ABOVE PROCEDURES, THE RELIEF REQUESTED IN THE

APPLICATION MAY BE GRANTED WITHOUT FURTHER NOTICE OR HEARING.

Dated: Wilmington, Delaware

June 19, 2013

SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP

/s/ Christine W. Kim

Anthony W. Clark (I.D. No. 2051)

Christine W. Kim (I.D. No. 5272)

One Rodney Square

P.O. Box 636

Wilmington, Delaware 19899-0636

Telephone: (302) 651-3000

Fax: (302) 651-3001

- and -

Kenneth S. Ziman

J. Eric Ivester

Four Times Square

New York, New York 10036-6522

Telephone: (212) 735-3000

Fax: (212) 735-2000

- and -

James J. Mazza, Jr.

155 N. Wacker Dr.

Chicago, Illinois 60606-1720

Telephone: (312) 407-0700

Fax: (312) 407-0411

Proposed Counsel for Debtor and Debtor in Possession


EXHIBIT A

Adrian Declaration



- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - In re: EXIDE TECHNOLOGIES, Debtor1 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

x:::::::x

Chapter 11 Case No. 13-11482 (KJC)

DECLARATION OF BRENDA ADRIAN IN SUPPORT OF APPLICATION OF THE DEBTOR PURSUANT TO BANKRUPTCY CODE SECTIONS 327(a) AND 328(a),

BANKRUPTCY RULE 2014(a), AND LOCAL BANKRUPTCY RULES 2014-1 AND 2016 AUTHORIZING THE EMPLOYMENT AND RETENTION OF SITRICK AND

COMPANY AS CORPORATE COMMUNICATIONS AND PUBLIC RELATIONS CONSULTANTS TO THE DEBTOR NUNC PRO TUNC TO THE PETITION DATE

Pursuant to Bankruptcy Rule 2014(a), Brenda Adrian declares as follows:

1. I am a member of the public relations firm Sitrick and Company, Inc.

(“Sitrick”), and I am authorized to execute this affidavit on behalf of Sitrick. I submit this

affidavit in support of the Debtor’s Application for an Order under Bankruptcy Code sections

327(a) and 328(a), Bankruptcy Rule 2014(a), and Local Rules 2014-1 and 2016-2 Authorizing

the Employment and Retention of Sitrick & Company, Inc. as Corporate Communications and

Public Relations Consultants to the Debtor Nunc Pro Tunc to the Petition Date (the

“Application”), filed contemporaneously herewith by the debtor and debtor in possession in the

above-captioned case (“Exide” or the “Debtor”). Except as otherwise indicated, I have personal

knowledge of the matters set forth herein and, if called as a witness, would testify competently

thereto.

1 The last four digits of the Debtor’s taxpayer identification number are 2730. The Debtor’s corporate

headquarters are 13000 Deerfield Parkway, Building 200, Milton, Georgia 30004.


2

2. The name, address, telephone, and facsimile of Sitrick are: Sitrick and

Company Inc., 1840 Century Park East, Suite 800, Los Angeles, CA 90067, Ph: (310) 788-2850,

Facsimile: (310) 788-2855.

3. Sitrick is one of the nation’s leading public relations firms. Sitrick is a

full-service independent global public relations firm with approximately 50 professionals

collaborating across its Los Angeles, New York, San Francisco, and Washington DC offices.

Sitrick has been ranked as one of the top strategic communications companies in the nation and

has emerged as a leader in corporate reputation management, with extensive experience in both

out-of-court restructurings and complex chapter 11 cases.

4. Formed in 1989, Sitrick specializes in addressing sensitive business

situations that require communications strategies targeted to a variety of constituencies,

including customers, employees, vendors, shareholders, bondholders, and the media. Sitrick has

substantial experience providing corporate communications services to large companies in

connection with both in and out-of court restructurings. Sitrick believes that it possesses the

largest such restructuring practice in the public relations industry.

5. Sitrick has provided the Debtor with consulting services comparable to

those for which Sitrick’s retention is sought hereunder since April 26, 2013, during which time

Sitrick has acquired considerable knowledge of the Debtor’s business operations and financial

affairs and has already developed strategies for communicating to the Debtor’s key

constituencies about the case and plans for restructuring.

6. In providing prepetition services to the Debtor, Sitrick’s professionals

have worked closely with the Debtor’s management and other professionals and have become

well acquainted with the Debtor’s business and operations, and related matters. Accordingly, I


3

believe that Sitrick has developed significant relevant experience and expertise regarding the

Debtor that will assist it in providing effective and efficient services in this chapter 11 case.

7. I believe that I and other professionals employed by Sitrick are well

qualified to continue to act as the Debtor’s corporate communications consultants. Sitrick is one

of the nation’s leading public relations firms best known for its communications work in

sensitive situations. Sitrick specializes in addressing sensitive business situations that require

communications strategies targeted to a variety of constituencies, including customers,

employees, vendors, shareholders, bondholders, and the media. Sitrick has substantial

experience providing corporate communications services to large corporations in connection

with both in- and out-of-court restructurings. Sitrick believes that it possesses the largest such

restructuring practice in the public relations industry.

8. Sitrick regularly provides such services to numerous business entities,

both in and out of bankruptcy proceedings. For example, Sitrick has been retained and

performed services in the Chapter 11 bankruptcy cases of USG Corporation, America West

Airlines, Brazos Sportswear, Inc., Bumble Bee Seafoods, Inc., Eddie Haggar Limited, Inc.,

Burlington Industries, Inc., Peregrine Systems, Inc., Delphi Corp., and others.

9. Sitrick believes it is well qualified and able to represent the Debtor in a

cost-effective, efficient, and timely manner.

SERVICES TO BE RENDERED

10. Pursuant to the terms of the engagement letter between the Debtor and

Sitrick, dated April 26, 2013, a copy of which is attached hereto as Exhibit 1 (the “Engagement

Agreement”), the Debtor seeks to continue to retain Sitrick to render corporate communications


4

consulting and related services to the Debtor as needed throughout the course of the case. In

particular, Sitrick will perform, among others, the following services:

(a) Develop and implement communications programs and related strategies and initiatives for communications with the Debtor’s key constituencies (including customers, employees, vendors, bondholders, related key constituencies, and the media) regarding the Debtor’s operations and progress through the chapter 11 process;

(b) Develop public relations initiatives for the Debtor to maintain public confidence and internal morale during the chapter 11 process;

(c) Prepare press releases and other public statements for the Debtor, including statements relating to major chapter 11 events;

(d) Prepare other forms of communication to the Debtor’s key constituencies and the media;

(e) Develop and maintain a website containing communications materials for various constituencies regarding the restructuring; and

(f) Perform such other communications consulting services as may be requested by the Debtor.

11. As noted above, Sitrick has substantial expertise in all of these areas and is

willing to perform such services for the Debtor.

PROFESSIONAL COMPENSATION

12. Sitrick’s allowance of compensation and reimbursement of expenses will

remain subject to review and approval of this Court, and Sitrick will apply to this Court for

allowance of compensation and reimbursement for out-of-pocket disbursements incurred during

the pendency of the Chapter 11 Case.

13. As set forth in further detail in the Engagement Agreement, Sitrick intends

to: (a) charge for the agreed-upon services in accordance with its standard hourly billing rates,

which range from $185 to $950, depending on the person performing the services (the Sitrick

professionals anticipated to be assigned to this case are as follows: Brenda Adrian, $625/hour;


5

AnitaMarie Laurie, $625/hour; and Ashley Cantwell, $235/hour, and Sitrick may involve other

professionals employed by Sitrick with similar experience and rates to implement

communications strategies as may be necessary from time to time), and (b) seek reimbursement

of reasonable and necessary expenses incurred in connection with rendering corporate

communications consulting services to the Debtor.

14. Sitrick's rates are comparable to what is generally charged by other firms

of similar stature to Sitrick for comparable engagements, both in and out of bankruptcy, and

represent Sitrick’s standard fee amounts. Sitrick and the Debtor believe that the foregoing

compensation arrangement is both reasonable and market-based and consistent with Sitrick’s

normal and customary billing levels for comparably sized and complex cases, both in and out-of-

court, involving the services to be provided in the Chapter 11 Case.

15. In addition, the Debtor has agreed to reimburse Sitrick for all reasonable,

documented out of pocket expenses actually incurred by Sitrick (excluding legal fees, expenses,

and disbursements). Sitrick will follow its customary expense reimbursement guidelines and

practices in seeking expense reimbursement from the Debtor.

16. Sitrick intends to file interim and final fee applications for the allowance

of compensation for services rendered and reimbursement of expenses incurred in accordance

with applicable provisions of the Bankruptcy Code, the Fee Guidelines, the Bankruptcy Rules,

and any applicable orders of this Court. Such applications will include time records setting forth,

in a summary format, a description of the services rendered by each professional, and the amount

of time spent on each date by each such individual in rendering services on behalf of the Debtor.

Time is billed by Sitrick in increments of one-tenth of an hour. Sitrick will also maintain


6

detailed records of any actual and necessary costs and expenses incurred in connection with the

services discussed above.

17. On or about April 29, 2013, the Debtor paid Sitrick $110,000.00 as an

initial retainer (the “Retainer”), and replenished that amount from time to time prior to the

Petition Date. In total, prepetition, the Debtor paid Sitrick $684,755.72. Prior to the Petition

Date, Sitrick applied the Retainer amounts against Sitrick's prepetition fees and costs, meaning

Sitrick did not have any outstanding and unpaid fees as of the Petition Date. As of the Petition

Date, Sitrick had approximately $42,000.00 on hand from the total Retainer amounts paid which

is available for payment of additional fees and costs incurred postpetition. Subject to this Court

approval, Sitrick’s fees incurred postpetition will be applied against the Retainer and will be

determined in accordance with Sitrick’s standard hourly billing rates, and any amounts incurred

above the amount of the retainer will be paid by the Debtor.

18. The Debtor proposes to pay Sitrick at the rates and on the terms set forth

in the Engagement Agreement, to be set off against the amount of the Retainer that was not

applied prior to the Petition Date. The rates set forth in the Engagement Agreement are Sitrick’s

standard rates for work of this nature and are set at a level designed to compensate Sitrick fairly

for the work of its professionals and to cover fixed and routine overhead expenses while also

being responsive to the Debtor’s current financial condition.

19. There are no arrangements between Sitrick and any other entity to share

compensation received or to be received in connection with the case.

INDEMNIFICATION

20. Sitrick and its shareholders, officers, directors, employees, and agents

(collectively, the “Indemnified Parties”) will be indemnified by the Debtor under certain


7

circumstances as set forth in the Engagement Agreement. Pursuant to the Engagement

Agreement, the Debtor agrees to indemnify the Indemnified Parties for Sitrick in accordance

with the Engagement Agreement for any claim arising from, related to, or in connection with the

services provided for, whether prepetition or postpetition, in the Engagement Agreement. See

Engagement Agreement, ¶ 6.

DISINTERESTEDNESS

21. Sitrick is aware that the Debtor has numerous creditors, stakeholders, and

other parties with whom it maintains business relationships. Prior to the filing of this

Declaration, Sitrick obtained from the Debtor the names of the Debtor’s directors and officers,

prepetition and postpetition lenders, other secured creditors, certain unsecured creditors, five

percent (5%) or greater shareholders, significant contract parties, and professionals, and other

individuals and entities which may be parties in interest in the chapter 11 case (collectively, the

“Potential Parties in Interest”). Sitrick maintains a database containing the names of current,

former, and potential clients and other principal parties related to such clients. I caused Sitrick to

review and analyze the conflict database to determine whether Sitrick has any connection with

the Potential Parties in Interest.

22. Based upon this research, I have determined that Sitrick has not provided

services to any Potential Parties in Interest over the past three (3) years.

23. To the best of my knowledge, and in view of the foregoing, Sitrick and the

professionals employed by it are disinterested persons who do not hold or represent an interest

adverse to the estate and except as set forth above do not have any connection either with the

Debtor, its creditors, or any other party in interest in the case or with their respective

professionals or accountants, with the judges of this Court, or with the United States Trustee or

any person employed in the Office of the United States Trustee.


8

24. Sitrick makes the following additional disclosures with respect to Sitrick’s

disinterestedness. References to Sitrick include all members expected to render services in these

cases:

a) Sitrick is not a creditor, equity security holder, or insider of the Debtor;

b) Sitrick is not and was not investment bankers for any outstanding security of the Debtor;

c) Sitrick has not been, within three (3) years before the Petition Date, (i) investment bankers for a security of the Debtor, or (ii) an attorney for such investment banker in connection with the offer, sale, or issuance of a security of the Debtor; and

d) Sitrick was not, within two (2) years before the Petition Date, a director, officer, or employee of the Debtor or of any investment banker as specified in subparagraph (b) or (c) of this paragraph.

25. Although Sitrick is unaware of any other connections at the present time,

it is possible that Sitrick may have provided services for certain other creditors or other parties of

interest in this case in matters unrelated to the Debtor or the instant bankruptcy case. I

understand that if any information as stated herein changes or if I learn of any additional

connections at a later date, I have a duty to supplement this declaration to disclose those facts.


9

I declare under penalty of perjury under the laws of the United States of America that, to

the best of my knowledge and belief, and after reasonable inquiry, the foregoing is true and

correct.

Executed this 19th day of June, 2013.

SITRICK & COMPANY, INC.

By: Brenda Adrian Member of the Firm


EXHIBIT 1

Engagement Agreement










- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - In re: EXIDE TECHNOLOGIES, Debtor1 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

x:::::::x

Chapter 11 Case No. 13-11482 (KJC) Related Docket No. _____

ORDER GRANTING APPLICATION OF THE DEBTOR PURSUANT TO BANKRUPTCY CODE SECTIONS 327(a) AND 328(a), BANKRUPTCY RULE 2014(a),

AND LOCAL BANKRUPTCY RULES 2014-1 AND 2016-1 AUTHORIZING THE EMPLOYMENT AND RETENTION OF SITRICK AND COMPANY AS CORPORATE COMMUNICATIONS AND PUBLIC RELATIONS CONSULTANTS TO THE DEBTOR

NUNC PRO TUNC TO THE PETITION DATE

Upon the application (the “Application”)2 of the above-captioned debtor and

debtor in possession (“Exide” or the “Debtor”), for an order pursuant to 11 U.S.C. §§ 327(a) and

328(a), and Rule 2014(a) of the Federal Rules of Bankruptcy Procedure, and Rules 2014-1 and

2016-2(h) of the Local Rules of Bankruptcy Practice and Procedure of the United States

Bankruptcy Court for the District of Delaware, (a) authorizing the employment and retention of

Sitrick and Company (“Sitrick”) as corporate communications consultants in the chapter 11 case

effective as of the date of the filing of the bankruptcy case; and upon the Declaration of Brenda

Adrian in support of the Application (the “Adrian Declaration”); and this Court having reviewed

the Application and the Adrian Declaration, and determined that the relief requested in the

Application is in the best interests of the Debtor, its estate, its creditors, and other parties in

1 The last four digits of the Debtor’s taxpayer identification number are 2730. The Debtor’s corporate

headquarters are 13000 Deerfield Parkway, Building 200, Milton, Georgia 30004.

2 Unless otherwise defined herein, capitalized terms used herein shall have the meanings ascribed to them in the Application.


2

interest; and it appearing that notice of the Application was good and sufficient under the

particular circumstances and that no other or further notice need be given; and upon the record

herein; and after due deliberation thereon; and good and sufficient cause appearing therefore, it is

hereby

ORDERED, ADJUDGED, AND DECREED that:

1. The Application is GRANTED as provided herein, nunc pro tunc to the

Petition Date.

2. Pursuant to section 327(a) and 328(a) of the Bankruptcy Code, the Debtor

is authorized to employ and retain Sitrick as its corporate communications consultant effective as

of the Petition Date, pursuant to the terms and conditions of the Engagement Agreement, and to

pay fees to Sitrick on the terms and at the times specified in the Engagement Agreement.

3. Sitrick shall be compensated in accordance with the procedures set forth in

sections 330 and 331 of the Bankruptcy Code and such Federal Rules of Bankruptcy Procedure

and Local Bankruptcy Rules for the United States Bankruptcy Court for the District of Delaware

as may then be applicable, from time to time, and such procedures as may be fixed by order of

this Court.

4. Except as otherwise expressly provided herein, all terms of the

Engagement Agreement, including those relating to contractual limitation of liability, including,

but not limited to, indemnification of Sitrick, are hereby approved; provided, however, that,

notwithstanding anything herein to the contrary, the Debtor is hereby authorized to indemnify

Sitrick nunc pro tunc to the Petition Date.


3

5. The Debtor shall indemnify and hold harmless Sitrick and the other

Indemnified Parties, pursuant to the Engagement Agreement, subject, during the pendency of the

Chapter 11 Case, to the following:

a. Sitrick shall not be entitled to indemnification, contribution, or reimbursement pursuant to the Engagement Agreement for services, unless such services and the indemnification, contribution or reimbursement therefor are approved by this Court;

b. The Debtor shall have no obligation to indemnify Sitrick, or provide contribution or reimbursement to Sitrick, for any claim or expense that is either: (i) judicially determined (the determination having become final) to have arisen from Sitrick’s gross negligence, fraud, willful misconduct, breach of fiduciary duty, if any, bad faith, or self-dealing; (ii) for a contractual dispute in which the Debtor allege the breach of Sitrick’s contractual obligations, unless this Court determines that indemnification, contribution, or reimbursement would be permissible pursuant to In re United Artists Theatre Co., 315 F.3d 217 (3d Cir. 2003); or (iii) settled prior to a judicial determination as to the exclusions set forth in clauses (i) and (ii) above, but determined by this Court, after notice and a hearing, to be a claim or expense for which Sitrick should not receive indemnity, contribution, or reimbursement under the terms of the Engagement Agreement as modified by this Order; and

c. If, before the earlier of (i) the entry of an order confirming a chapter 11 plan in the case (that order having become a final order no longer subject to appeal) and (ii) the entry of an order closing the Chapter 11 Case, Sitrick believes that it is entitled to the payment of any amounts by the Debtor on account of the Debtor’s indemnification, contribution, and/or reimbursement obligations under the Engagement Agreement (as modified by this Order), including, without limitation, the advancement of defense costs, Sitrick must file an application therefor in this Court, and the Debtor may not pay any such amounts to Sitrick before the entry of an order by this Court approving the payment. This subparagraph (c) is intended only to specify the period of time under which this Court shall have jurisdiction over any request for fees and expenses by Sitrick for indemnification, contribution, or reimbursement, and not a provision limiting the duration of the Debtor’s obligation to indemnify Sitrick. All parties in interest shall retain the right to object to any demand by Sitrick for indemnification, contribution, or reimbursement.

6. Sitrick shall be compensated in accordance with the procedures set forth in

Bankruptcy Code sections 330 and 331 and such Bankruptcy Rules as may then be applicable,

and such procedures as may be fixed by order of this Court.

7. The Debtor and Sitrick are authorized to take all actions necessary to

effectuate the relief granted pursuant to this Order.


4 960109-CHISR02A - MSW

8. Notwithstanding the possible applicability of Bankruptcy Rules 6004(h),

7062, 9014 or otherwise, this Order shall be immediately effective and enforceable upon its

entry.

9. The relief granted herein shall be binding upon any chapter 11 trustee

appointed in the Chapter 11 Case, or upon any chapter 7 trustee appointed in the event of a

subsequent conversion of the Chapter 11 Case to a case under chapter 7.

10. To the extent that the Order is inconsistent with the Engagement

Agreement, the terms of this Order shall govern.

11. This Court shall retain jurisdiction to hear and determine all matters

arising from the implementation of this Order.

Dated: Wilmington, Delaware , 2013 The Honorable Kevin J. Carey UNITED STATES BANKRUPTCY JUDGE


Date post:	07-Sep-2018
Category:	Documents
Upload:	vuthien
View:	215 times
Download:	0 times

APPLICATION OF THE DEBTOR PURSUANT TO BANKRUPTCY … · “Bankruptcy Rules”), and rules 2014-1...

Documents