Babalu BK File

Case 19-61688-wlh Doc 169 Filed 10/18/19 Entered 10/18/19 17:08:55 Desc Main
Document Page 1 of 20
IT IS ORDERED as set forth below:
Date: October 18, 2019

_____________________________________
Wendy L. Hagenau
U.S. Bankruptcy Court Judge
_______________________________________________________________
UNITED STATES BANKRUPTCY COURT

NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
In re: ) Chapter 11
)
EAT HERE BRANDS, LLC, et al.1, ) Lead Case No. 19-61688-WLH
)
Debtors. ) Jointly Administered
)
ORDER (I) AUTHORIZING THE SALE OF SUBSTANTIALLY ALL OF THE

DEBTORS] ASSETS FREE AND CLEAR OF ALL LIENS, CLAIMS,
INTERESTS, AND ENCUMBRANCES, (II) AUTHORIZING THE ASSUMPTION
AND ASSIGNMENT OF CERTAIN EXECUTORY CONTRACTS AND
UNEXPIRED LEASES, AND (III) GRANTING CERTAIN RELATED RELIEF
Upon consideration of the Sale Motion [Docket No. 110T &h\Y pMotionq'2 of Eat Here
Brands, LLC, Babalu Atlanta #1 LLC, Babalu Atlanta #2 LLC, Babalu Knoxville #1 LLC,
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M\Y =YVhcfg ]b h\YgY W\UdhYf -- WUgYg( U`cb[ k]h\ h\Y Ùgh Zcif X][]hg cZ YUW\ =YVhcfrg Zederal tax
identification number, are as follows: Eat Here Brands, LLC (9694); Babalu Atlanta #1 LLC (4025); Babalu Atlanta
#2 LLC (5240); Babalu Knoxville #1 LLC (3163); Babalu Memphis #1 LLC (9320); Babalu Memphis #2 LLC
(4558); Babalu, LLC (7673); and ;UVUì ;]fa]b[\Ua $- EE< &-45.'* M\Y =YVhcfgr aU]`]b[ UXXfYgg ]g 5311
Dogwood Road, Suite 200, Roswell, Georgia 30075.
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Capitalized terms not otherwise defined in this Order shall have the meanings given to them in the Motion.
AGG\14035070v5
Babalu Memphis #1 LLC, Babalu Memphis #2 LLC, Babalu, LLC, and Babalu Birmingham #1
EE< &Wc``YWh]jY`m( h\Y pDebtorsq1), which requests, among other things, entry of an order
(the pOrderq' difgiUbh hc Lections 105, 363 and 365 of title 11 of the United States Code
(the pBankruptcy Codeq'( Ki`Yg .,,.( 2,,0( 2,06, 9006, and 9008 of the Federal Rules of
;Ub_fidhWm IfcWYXifY &h\Y pBankruptcy Rulesq'( and General Order No. 26-2019 governing
Complex Chapter -- <UgYg &h\Y pComplex Case Proceduresq'6 &]' Uih\cf]ning and approving the
sale (the pSaleq' cZ substantially all of the Debtorsr UggYhg &h\Y pAcquired Assetsq' ZfYY UbX W`YUf
of all liens, claims, interests, and encumbrances (other than the Assumed Liabilities)
&Wc``YWh]jY`m( h\Y pEncumbrancesq'7 &]]' Uih\cf]n]b[ h\Y Uggiadh]cb UbX Ugg][baYbh cZ WYfhU]b
executorm WcbhfUWhg UbX ibYld]fYX `YUgYg &h\Y pDesignated Contractsq'( ]XYbh]Z]YX Vm h\Y =YVhcfs
and more fully described in the Asset Purchase Agreement dated as of September 9, 2019,
attached as Exhibit A hc h\Y Fch]cb &h\Y pAPAq' Vm UbX VYhkYYb h\Y =YVhcfs and
Balu Holdings, LLC &h\Y pPurchaserq'( Ug gidd`YaYnted by the Notice of Assumption and
Assignment filed by the Debtors on September 27, 2019 [Docket No. 137] and the Second
Notice of Assumption and Assignment filed by the Debtors on October 15, 2019 [Docket No.
164] (collectively, h\Y pCure Noticeq'; and (iii) granting certain related relief; and the Court
having held a hearing on October 18, 2019 (the pSale Hearingq' hc UddfcjY h\Y LU`Y free and
clear of the Encumbrances and the assumption and assignment of the Designated Contracts; the
Court having reviewed and considered the Motion, the arguments of counsel, and the evidence
presented at the Sale Hearing; and all objections to the Motion having been either withdrawn or
overruled; and it appearing that the relief requested in the Motion is in the best interests of the
Debtors, their bankruptcy estates, and all creditors and other parties in interest; and sufficient
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Babablu Atlanta #2 LLC joined in the Motion; however, its assets are not being sold pursuant to this Order.
Accordingly, the definition of Debtors in this Order does not include Babablu Atlanta #2 LLC.
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notice of the Motion having been given to all creditors and parties in interest; and upon the
record made at the Sale Hearing and in the Bankruptcy Cases, after due deliberation thereon, and
good cause appearing therefore:#
This Court hereby FINDS and CONCLUDES as follows:1
A. Jurisdiction and Venue. The Court has jurisdiction over the Motion pursuant to
28 U.S.C. §§ 157 and 1334, and this matter is a core proceeding pursuant to 28 U.S.C. § 157(b).
Venue of the Bankruptcy Cases and the Motion in this district is proper under 28 U.S.C. §§ 1408
and 1409.
B. Statutory Predicates. The statutory predicates for the relief sought in the Motion
are Sections 105, 363, and 365 of the Bankruptcy Code, Rules 2002, 6004, 6006, 9006, and 9008
of the Bankruptcy Rules, and the Complex Case Procedures.
C. Origin Bank Pre-Petition Secured Debt and DIP Financing. As of the
Petition Date, the Debtors were indebted to Origin Bank, without defense, counterclaim,
recoupment, or offset of any kind, in the approximate non-contingent liquidated amount of no
less than $5,607,182.58, plus pre-petition interest, fees, expenses, and other amounts arising in
fYgdYWh cZ giW\ cV`][Uh]cbg &Wc``YWh]jY`m( h\Y pPre-Petition Obligationsq'* On August 20, 2019,
the Court entered a Final DIP Order in these Bankruptcy Cases [Docket No. 69] as amended by
that certain Amended Final DIP Order R=cW_Yh Gc* -,/T &h\Y pFinal DIP Orderq'( k\]W\( Uacb[
ch\Yf h\]b[g( Uih\cf]nYX h\Y =YVhcfg hc igY WUg\ Wc`ÙhYfU` UbX h\Y dfcWYYXg cZ h\Y =YVhcfgr =BI
loan from Origin Bank pursuant to a budget, which was attached to the DIP Financing Motion
[Docket No. 16] as Exhibit C (the pBudgetq'* Pursuant to the Final DIP Order, the Debtors
borrowed the principal amount of %-*.,1 a]``]cb &h\Y pDIP Loan Obligationq' Zfca Origin Bank.
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Findings of fact shall be construed as conclusions of law and conclusions of law shall be construed as findings
of fact when appropriate. See Rule 7052 of the Bankruptcy Rules.
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D. Entry of Bid Procedures Order. On September 27, 2019, this Court entered its
Order (A) Authorizing and Approving Bid Procedures in Connection with the Sale of
Substantially All of the DebtorsN Assets; (B) Scheduling an Auction and Sale Hearing;
(C) Approving the Manner and Form of Notice of Sale, Auction and Sale Hearing, and
(D) Granting Related Relief [Docket No. 135T &h\Y pBid Procedures Orderq'( k\]W\ ]bWìXYX(
inter alia, approval of certain bid procedures with respect to bids for all or substantially all of the
Debtorsr assets (the pBidding Proceduresq' UbX UddfcjU` cZ h\Y manner and form of notice and
dfcWYXifYg Zcf h\Y Uggiadh]cb UbX Ugg][baYbh cZ =Yg][bUhYX <cbhfUWhg &h\Y pAssumption and
Assignment Proceduresq' UbX h\Y YghUV`]g\aYbh cZ h\Y WifY Uacibhg fYei]fYX hc VY dU]X ]b
WcbbYWh]cb h\YfYk]h\ &h\Y pCure Amountsq'*
E. Compliance with Bid Procedures Order. As demonstrated by evidence
presented at the Sale Hearing and the representations of counsel, the Debtors have marketed the
Acquired Assets, conducted the sale process in compliance with the Bid Procedures Order, duly
noticeX h\Y h]a]b[ Zcf h\Y giVa]gg]cb cZ V]Xg UbX dfcdcgYX UiWh]cb &h\Y pAuctionq' ]b U bcb-
collusive, fair, and good faith manner, and have afforded potential purchasers a full and fair
opportunity to make higher and better offers. As a result of not receiving any other Qualified
Bid for the Acquired Assets by the Bid Deadline, the Debtors filed the Notice of No Competing
Bids and Cancellation of Auction on October 11, 2019 [Docket No. 155]. In accordance with the
Bidding Procedures, the Debtors determined that the bid submitted by the Purchaser, and as
memorialized by the APA, is the Successful Bid (as defined in the Bidding Procedures).
F. Notice. As evidenced by the certificates or affidavits of service filed with the
Court, and based on the representations of counsel at the Sale Hearing: (i) proper, timely, and
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sufficient notice of the Motion, the Sale Hearing, the Sale, the Assumption and Assignment
Procedures, the assumption and assignment of the Designated Contracts and the Cure Amounts
have been provided in accordance with Sections 102(1), 363 and 365 of the Bankruptcy Code
and Rules 2002, 6004, 6006, and 9006 of the Bankruptcy Rules and in compliance with the Bid
Procedures Order; and (ii) no other or further notice of the Motion, the Sale Hearing, the Sale, or
the assumption and assignment of the Designated Contracts or the Cure Amounts is or shall
be required.
G. Opportunity to Object. A fair and reasonable opportunity to object or be heard
with respect to the Motion and the relief requested therein has been afforded to all interested
persons and entities.
H. Sale in Best Interest. Consummation of the Sale of the Acquired Assets at this
time is in the best interests of the Debtors, their creditors, their bankruptcy estates and all other
parties in interest.
I. Business Justification. The Debtors have presented good and sufficient business
reasons justifying the Sale, including, but not limited to, the following: (i) the APA constitutes
the highest and best offer for the Acquired Assets; and (ii) the APA and the closing thereon will
present the best opportunity to realize the value of the Acquired Assets on a going-concern basis
and avoid decline and devaluation of the Acquired Assets. The terms and conditions of the APA,
including, without limitation, the consideration to be realized by the Debtors, are fair and
reasonable. Approval of the Motion, the APA, and the transactions contemplated thereby,
including, without limitation, the Sale and the assumption and assignment of the Designated
Contracts, is in the best interests of the Debtors, their bankruptcy estates and creditors, and all
other parties in interest.
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J. +UP]V 6HQJWK =DOH. The APA was negotiated, proposed, and entered into by the
Debtors and the Purchaser without collusion, in good faith, abX Uh Ufarg `Yb[h\* Neither the
Debtors nor the Purchaser has engaged in any conduct that would warrant avoidance of the APA
under Section 363(n) of the Bankruptcy Code. The Purchaser has not acted in a collusive
manner with any person and the purchase price was not controlled by any agreement among
potential bidders. M\Y IifW\UgYf ]g bch Ub p]bg]XYfq cZ any of the Debtors as defined in
Section 101(31) of the Bankruptcy Code. The Court finds that the Debtors and the Purchaser
each has the full power and authority to execute, deliver, and perform the APA.
K. Good Faith Purchaser. The Purchaser is a good faith purchaser for value and is
entitled to all of the protections afforded under Section 363(m) of the Bankruptcy Code.
Specifically, (i) the Purchaser recognized that the Debtors were free to deal with any other party
interested in purchasing the Acquired Assets, (ii) the Purchaser complied in all respects with the
provisions in the Bid Procedures Order, (iii) the Purchaser agreed to subject its bid to the
competitive bid procedures set forth in the Bid Procedures Order, (iv) all payments to be made
by the Purchaser in connection with the Sale have been disclosed, (v) the Purchaser is not an
p]bg]XYfq cZ any of the Debtors, as such term is defined in Section 101(31) of the
Bankruptcy Code, and (vi) the negotiation and execution of the APA kUg Uh Ufarg `Yb[h\ UbX ]b
good faith, and at all times the Purchaser and the Debtors were represented by competent counsel
of their choosing.
L. Sale Free and Clear of the Encumbrances. The Debtors may sell the Acquired
Assets free and clear of all obligations, liabilities, and the Encumbrances, other than the
Assumed Liabilities, because, with respect to each creditor asserting an Encumbrance, one or
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more of the standards set forth in Section 363(f)(1)-(5) of the Bankruptcy Code has
been satisfied.
M. Assumption and Assignment of Executory Contracts and Unexpired Leases.
The Designated Contracts being assigned to the Purchaser are an integral part of the Acquired
Assets being purchased by the Purchaser. The Debtors have demonstrated that it is an exercise
of their sound business judgment to assume and assign the Designated Contracts to the Purchaser
in connection with the consummation of the Sale, and the assumption and assignment of the
Designated Contracts is the best interests of the Debtors, their bankruptcy estates, and
their creditors.
N. Cure/Adequate Assurance Related to Designated Contracts. The Purchaser
has (i) cured or has provided adequate assurance that it will cure, any default existing prior to the
date hereof under any of the Designated Contracts, within the meaning of Section 365(b)(1)(A)
of the Bankruptcy Code, and (ii) provided compensation or adequate assurance of compensation
to any party for any actual pecuniary loss to such party resulting from a default prior to the
Closing under any of the Designated Contracts within the meaning of Section 365(b)(1)(B) of the
Bankruptcy Code. The Purchaser has provided adequate assurance of future performance of and
under the Designated Contracts within the meaning of Section 365(b)(1)(C) of the
Bankruptcy Code.
O. Prompt Consummation. The sale of the Acquired Assets must be approved and
consummated promptly to preserve the value of the Acquired Assets. Therefore, time is of the
essence in consummating the Sale, and the Debtors and the Purchaser intend to close the Sale as
soon as reasonably practicable.
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P. Purchaser Not an Insider and No Successor Liability. The Purchaser is not an
p]bg]XYfq cf pUZZ]`]UhYq of any of the Debtors, as those terms are defined in the Bankruptcy Code.
Except for the Assumed Liabilities, the transfer of the Acquired Assets to the Purchaser does not,
and will not, subject the Purchaser to any liability whatsoever, with respect to the Debtorsr
operation of their businesses prior to the closing of the Sale or by reason of such transfer under
any theory of law or equity. The Sale is not a consolidation, merger or de facto merger of the
Purchaser and the Debtors and/or the Debtorsr bankruptcy estates. There is no substantial
continuity between the Purchaser and the Debtors, and there is no continuity of enterprise
between the Debtors and the Purchaser. The Purchaser is not a mere continuation of the Debtors
or the Debtorsr bankruptcy estates, and the Purchaser does not constitute a successor to the
Debtors or the Debtorsr bankruptcy estates.
Q. Valid Transfer. The transfer of the Acquired Assets to the Purchaser will vest
the Purchaser with all right, title, and interest of the Debtors to the Acquired Assets free and
clear of all Encumbrances, except for the Assumed Liabilities. The Acquired Assets constitute
property of the Debtorsr bankruptcy estates and good title is vested in the Debtorsr bankruptcy
estates within the meaning of Section 541(a) of the Bankruptcy Code. The Debtors are the sole
and rightful owners of the Acquired Assets, and no other person has any ownership right, title, or
interests therein.
R. Asset Purchase Agreement Not Modified. The Order shall not modify the
terms of the APA.
It is therefore ORDERED, ADJUDGED, and DECREED that:
1. The Motion is GRANTED and APPROVED in all respects as set forth in
this Order.
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2. All objections to the Motion or the relief requested therein that have not been
withdrawn, waived, or settled, and all reservations of rights included therein, are OVERRULED
on the merits and denied with prejudice.
Approval of the Sale of the Acquired Assets
3. The APA, including any amendments, supplements, and modifications thereto,
and all of the terms and conditions therein, is hereby approved.
4. Pursuant to Section 363(b) of the Bankruptcy Code, the sale of the Acquired
Assets to the Purchaser, and the transactions contemplated thereby, are approved in all respects,
and are free and clear of all obligations, liabilities and Encumbrances of every kind or nature,
other than the Assumed Liabilities.
Sale and Transfer of the Acquired Assets
5. Pursuant to Section 363(b) of the Bankruptcy Code, the Debtors are hereby
authorized and directed (a) to sell the Acquired Assets to the Purchaser and consummate the Sale
in accordance with, and subject to the terms and conditions of, the APA; (b) to transfer and
assign all right, title, and interest to all property, licenses, and rights to be conveyed in
accordance with and subject to the terms and conditions of the APA, and (c) to execute and
deliver, and are empowered to perform under, consummate and implement, the APA, and all
additional instruments and documents that may be reasonably necessary or desirable to
implement the APA.
6. Pursuant to Sections 363(b) and (f) of the Bankruptcy Code, the Acquired Assets
shall be transferred to the Purchaser upon consummation of the APA at the Closing, free and
clear of any and all claims (as defined in Section 101(5) of the Bankruptcy Code), and all
obligations, liabilities, and Encumbrances of any kind or nature whatsoever based on successor
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or transferee liability; provided, however, that the Acquired Assets shall not be free and clear of
the Assumed Liabilities that are being assumed by the Purchaser in connection with the
acquisition of the Acquired Assets.
7. Upon the Closing of the Sale, all obligations, liabilities, and Encumbrances of any
kind or nature whatsoever shall attach to the proceeds of the Sale to the same extent, validity,
and priority as they existed on the Petition Date.
8. Upon the Closing of the Sale, this Order shall be construed and constitute for all
purposes: (a) a general assignment, conveyance, and transfer of the Acquired Assets or a bill of
sale transferring good and marketable title in such Acquired Assets to the Purchaser; and (b) a
general assignment of all right, title, and interest of the Debtors to the Purchaser in the
Designated Contracts. Each and every federal, state, and local governmental agency or
department is hereby directed to accept any and all documents and instruments necessary and
appropriate to consummate the transactions contemplated by the APA.
9. All entities which are presently, or as of the Closing may be, in possession of
some or all of the Acquired Assets are hereby directed to surrender possession of the
Acquired Assets to the Purchaser upon the Closing of the Sale.
10. All persons and entities are prohibited and enjoined from taking any action to
adversely affect or interfere with the ability of the Debtors to transfer the Acquired Assets to the
Purchaser in accordance with the APA and this Order.
11. Except as expressly permitted by the APA or this Order, all persons and entities
holding claims or Encumbrances against or in any of the Debtors or the Acquired Assets
(whether legal or equitable, secured or unsecured, matured or unmatured, contingent or
noncontingent, senior or subordinated), are forever barred and permanently enjoined from
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asserting against the Purchaser, its successors and assigns, their respective property and the
Acquired Assets, such claims or Encumbrances.
12. On the Closing of the Sale, each of the Debtorsr WfYX]hcfg UfY authorized and
directed to execute such documents and take all other actions as may be necessary to release its
Encumbrances on the Acquired Assets, if any.
13. Subject to the terms and conditions of this Order and the APA, the transfer of the
Acquired Assets to the Purchaser pursuant to the APA constitutes a legal, valid, and effective
transfer of the Acquired Assets, and shall vest the Purchaser with all right, title, and interest of
the Debtors in and to the Acquired Assets free and clear of all Encumbrances of any kind or
nature whatsoever.
Use of Sale Proceeds to pay PACA Claimants and Certain Claims of Origin Bank
14. Unless previously paid in full in accordance with the Budget1 or the consent of
Origin Bank, (i) the Debtors shall segregate from the proceeds of the sale at Closing the
remaining amount necessary pay all PACA claimants the amounts set forth in the PACA Notice2
in full, and (ii) within five (5) business days of Closing, the Debtors shall pay each such PACA
claimant, from such proceeds of the Sale, the amount necessary to pay such PACA claimant in
full the amount set forth for it in the PACA Notice.
15. Within five (5) business days of Closing, the Debtors shall pay origin Bank the
amount necessary to repay the DIP Loan Obligation in full. Within two (2) business days after
the later of the Closing and the expiration of the Challenge Period (as such term is defined in the
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The Budget provides for the payment of $121,589 in PACA claims.
2
IifgiUbh hc h\Y <cifhrg I9<9 HfXYf R=cW_Yh Gc* -./T, on October 14, 2019, the Debtors filed a PACA
Notice [Docket No. 159] &h\Y pPACA Noticeq', which identified PACA claims totaling $160,685.37. Pursuant to
paragraph 6 of the PACA Order, and by virtue of the PACA Notice, Origin Bank and the Committee had three days
from the date of the PACA Notice to object to the PACA claim amounts set forth in the PACA Notice. Neither
Origin Bank nor the Committee filed a timely objection to the amounts set forth in the PACA Notice.
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Final DIP Order), the Debtors shall pay all of the remaining proceeds of the Sale toward the
satisfaction of the Pre-Petition Obligations (as defined in the Final DIP Order) less (1) the
payments to PACA claimants set forth in the preceding paragraph, (2) the payment of the DIP
Loan Obligation in (i) of this paragraph, (3) an amount equal to all unpaid administrative
expenses set forth in the Budget (but only to the extent that the Debtors have insufficient cash on
hand to pay such expenses, and not to exceed $200,000), and (4) $500,000. Any remaining
funds not disbursed in accordance with this Order shall be held by Debtors and shall only be
disbursed in accordance with a Subsequent Budget (as such term is defined in the Final DIP
Order) or pursuant to a plan or further order of the Court.
No Successor Liability
16. M\Y IifW\UgYf ]g bch U pgiWWYggcfq hc any of the Debtors or their bankruptcy
estates by reason of any theory of law or equity, and the Purchaser shall not assume, or be
deemed to assume, or in any way be responsible for any liability or obligation (other than the
Assumed Liabilities) of the Debtors and/or their bankruptcy estates, including, without
limitation, any claims arising under the Worker Adjustment and Retraining Notification Act of
1988 (29 U.S.C. § 2101 et seq.( h\Y pWARN Actq' cf Ubm cZ ]hg jUf]cig ghUhY Ùw analogs of the
WARN Act (such >bWiaVfUbWYg( Wc``YWh]jY`m( pWARN Claimsq'( k]h\ fYgdect to the
Acquired Assets or otherwise.
17. The Purchaser has given valuable and substantial consideration under the APA for
the releases of any potential claims of successor liability of the Purchaser. Upon consummation
of the Sale, the Purchaser shall not be deemed to (a) be the successor to any of the Debtors,
(b) have, de facto or otherwise, merged with or into any of the Debtors, or (c) be a mere
continuation, alter ego or substantial continuation of any of the Debtors.
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18. Except to the extent the Purchaser specifically agreed in the APA to assume the
Assumed Liabilities, or as expressly provided in this Order, the Purchaser shall not have any
liability, responsibility or obligation for any claims, liabilities or other obligations of the Debtors
or their bankruptcy estates, including, without limitation, WARN Claims and any other claims,
liabilities or other obligations related to the Acquired Assets prior to the Closing of the Sale.
Good Faith
19. The Purchaser is a purchaser in good faith of the Acquired Assets, and is entitled
to all of the protections afforded by Section 363(m) of the Bankruptcy Code.
20. Neither the Debtors nor any successor in interest to the Debtorsr bankruptcy
estates shall be entitled to bring an action against the Purchaser, and the Sale may not be
avoided, pursuant to Section 363(n) of the Bankruptcy Code.
Assumption and Assignment of the Designated Contracts
21. Pursuant to Sections 105(a) and 365 of the Bankruptcy Code, and subject to and
conditioned upon the Closing of the Sale, the Debtorsr assumption and assignment to the
IifW\UgYf( UbX h\Y IifW\UgYfrg Uggiadh]cb cb h\Y hYfag gYh Zcfh\ ]n the APA, of the Designated
Contracts is hereby approved, and the requirements of Section 365(b)(1) of the Bankruptcy Code
with respect thereto are hereby deemed satisfied.
22. The Debtors are hereby authorized and directed in accordance with
Sections 105(a), 363, and 365 of the Bankruptcy Code to (a) assume and assign to the Purchaser,
effective upon the Closing of the Sale, the Designated Contracts free and clear of all
Encumbrances of any kind or nature whatsoever, and (b) execute and deliver to the Purchaser
such documents or other instruments as may be necessary to assign and transfer the Designated
Contracts to the Purchaser.
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23. The Designated Contracts shall be transferred to and remain in full force and
effect for the benefit of the Purchaser in accordance with their respective terms, notwithstanding
any provision in any such Designated Contract that prohibits, restricts, or conditions such
assignment or transfer to the greatest extent permissible by law.
24. Pursuant to Section 365(k) of the Bankruptcy Code, the Debtors shall be relieved
from any further liability with respect to the Designated Contracts after such assignment to and
assumption by the Purchaser.
25. All defaults or other obligations of the Debtors under the Designated Contracts
arising or accruing prior to the date of this Order shall be cured by the Purchaser at the Closing
of the Sale (or as soon thereafter as reasonably practicable) in accordance with Section 365 of the
Bankruptcy Code and the Bid Procedures Order, if applicable, or as otherwise agreed by the
parties, and the Purchaser shall have no liability or obligation arising or accruing prior to the
Closing of the Sale, except as otherwise expressly provided in the APA or to the extent such
obligation is one of the Assumed Liabilities.
26. The Debtors, in consultation with the Purchaser, reserve the right to withdraw any
request to assume and assign a Designated Contract prior to Closing of the Sale, for any reason,
including if a non-Debtor party contests the Cure Amount or the Cure Amount as established by
this Court is unsatisfactory to the Debtors and the Purchaser.
27. Each non-Debtor party to an assumed and assigned contract is forever barred and
permanently enjoined from raising or asserting against the Debtors or the Purchaser, or the
property of either of them, any assignment fee, default, breach or claim of pecuniary loss, or
condition to assignment, arising under or related to the Designated Contracts, existing as of the
date of the Sale Hearing, or arising by reason of the consummation of the transactions
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contemplated by the APA, without limitation, the Sale and the assumption and assignment of the
Designated Contracts. Any party that may have had the right to consent to the assignment of a
Designated Contract is deemed to have consented to such assignment for purposes of
Section 365(e)(2)(A)(ii) of the Bankruptcy Code and otherwise if such party failed to object to
the assumption and assignment of such Designated Contract.
28. To the extent a counterparty to a Designated Contract failed to object timely to a
Cure Amount set forth in the Cure Notice, such Cure Amount shall be deemed to be finally
determined and any such counterparty shall be prohibited from challenging, objecting to or
denying the validity and finality of the Cure Amount at any time. The Designated Contracts and
applicable Cure Amounts are set forth on Exhibit A of this Order. Notwithstanding anything is
this Order, the landlord for h\Y =YVhcfgr WcfdcfUhY office lease in Roswell, Georgia, Pavilion
Building LLC c/o Equitable Management Corp. shall have until October 22, 2019 to file an
objection, if any, with this Court to the Cure Amount set forth on Exhibit A for that lease.
Additional Provisions
29. On the Closing, the Debtors and the Purchaser are authorized to take such actions
as may be necessary to obtain a release of any and all obligations, liabilities, and Encumbrances
in the Acquired Assets, if any, to the extent contemplated hereby and by the APA. This Order
(a) shall be effective as a determination that, upon the Closing of the Sale, all Encumbrances of
any kind or nature whatsoever existing as to the Acquired Assets prior to such closing have been
unconditionally released, discharged, and terminated except as otherwise provided in this Order
or the APA, and that the conveyances described herein have been effected, and (b) shall be
binding upon and shall govern the acts of all entities including, without limitation, all filing
officers, title agents, title companies, recorders of mortgages, recorders of deeds, registrars of
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deeds, administrative agencies, governmental departments, secretaries of state, federal, state, and
local officials, and all other persons and entities who may be required by operation of law, the
duties of their office, or contract, to accept, file, register or otherwise record or release any
documents or instruments, or who may be required to report or insure any title or state of title in
or to any of the Acquired Assets. Each and every federal, state, and local governmental agency
or department is hereby directed to accept any and all documents and instruments necessary and
appropriate to consummate the transactions contemplated by the APA.
30. The Purchaser and the Debtors shall take such further steps and execute such
further documents, assignments, instruments, and papers as shall be reasonably requested by the
other to implement and effectuate the transactions contemplated in this Order. All interests of
record as of the date of this Order shall be forthwith deemed removed and stricken as against the
Acquired Assets. All entities described in this paragraph and in the paragraph above are
authorized and specifically directed to strike all recorded liens, claims, rights, interests, and
Encumbrances against the Acquired Assets from their records, official and otherwise.
31. If any person or entity that has filed statements or other documents or agreements
evidencing claims, liens, Encumbrances, or interests in any of the Acquired Assets does not
deliver to the Debtors or the Purchaser prior to the Closing of the Sale, in proper form for filing
and executed by the appropriate parties, termination statements, instruments of satisfaction,
releases of liens, and easements, and any other documents necessary for the purpose of
documenting the release of all interests and other interests that the person or entity has or may
assert with respect to any of the Acquired Assets as and to the extent required by this Order or
under the APA, the Debtors and/or the Purchaser are hereby authorized to execute and file such
16
statements, instruments, releases, and other documents on behalf of such persons or entity with
respect to any of the Acquired Assets.
32. The Debtors will cooperate with the Purchaser and the Purchaser will cooperate
with the Debtors, in each case, to ensure that the transaction contemplated in the APA is
consummated.
33. The terms and provisions of the APA and this Order shall be binding in all
respects upon, and shall inure to the benefit of, the Debtors and their affiliates, successors and
assigns, their bankruptcy estates, and their creditors, the Purchaser, and its affiliates, successors
and assigns, and any affected third parties, including but not limited to, persons asserting
Encumbrances on the Acquired Assets and any subsequently appointed trustee(s) under any
chapter of the Bankruptcy Code.
34. The failure specifically to include any particular provisions of the APA in this
Order shall not diminish or impair the effectiveness of such provision, it being the intent of the
Court that the APA be authorized and approved in its entirety.
35. The APA and any related agreements, documents or other instruments may be
modified, amended or supplemented by the parties thereto, in a writing signed by both parties,
and in accordance with the terms thereof, without further order of the Court, provided that any
such modification, amendment or supplement does not have a material adverse effect on the
Debtorsr bankruptcy estates. To the extent that any provision of the APA conflicts with or is, in
any way, inconsistent with any provision of this Order, this Order shall govern and control.
36. Nothing contained in any plan of reorganization or liquidation confirmed in the
Bankruptcy Cases or any order of this Court in the Bankruptcy Cases, including any order
entered after any conversion of the Bankruptcy Cases to cases under chapter 7 of the Bankruptcy
17
Code, shall alter or conflict with the provisions of the APA or the terms of this Order. The
provisions of this Order and the APA and any actions taken pursuant thereto shall survive
confirmation of a plan or conversion of the Bankruptcy Cases from chapter 11 to chapter 7 of the
Bankruptcy Code.
37. The provisions of this Order are nonseverable and mutually dependent.
38. M\YfY UfY bc Vfc_Yfg ]bjc`jYX ]b WcbgiaaUh]b[ h\Y LU`Y UbX bc Vfc_Yfgr
commissions are due.
39. Compliance with the legal requirements relating to bulk sales and transfers is
not required.
40. The Debtors and each other person having duties or responsibilities under the
APA or this Order, and their respective agents, representatives, and attorneys, are authorized and
empowered to carry out all of the provisions of the APA and to perform all acts as are consistent
with, and necessary or appropriate to, implement, effectuate and consummate the APA and this
Order and the Sale all without further notice or application to, or order of, the Court.
41. This Court shall retain exclusive jurisdiction to enforce and implement the terms
and provisions of the APA and this Order.
42. Within two (2) business days of entry of this Order, the Debtors shall cause a
copy of this Order to be served upon all the parties identified on the Master Service List in these
;Ub_fidhWm <UgYg Ug UddfcjYX Vm h\]g <cifhrg HfXYf >ghUV`]g\]b[ Gch]WY UbX 9Xa]b]ghfUh]jY
Procedures [Docket No. 33].
43. This Order constitutes a final order within the meaning of 28 U.S.C. § 158(a).
Notwithstanding the possible applicability of Rules 6004, 6006, 7062, or 9014 of the Bankruptcy
18
Rules, or otherwise, the provisions of this Order shall be immediately effective and enforceable
upon its entry.
*** END OF ORDER ***
Prepared and presented by:
ARNALL GOLDEN GREGORY LLP
/s/ Darryl S. Laddin

Darryl S. Laddin
Georgia Bar No. 460793
Sean C. Kulka
171 17th Street, N.W., Suite 2100
Atlanta, Georgia 30363-1031
Phone: (404) 873-8500
Fax: (404) 873-8683
Email: darryl.laddin@agg.com
Email: sean.kulka@agg.com
Attorneys for Debtors and Debtors in Possession
19
Exhibit A @ Assumed and Assigned Leases
Counterparty Address City State Zip Description Cure Cost

of Agreement
29 SEVEN LLC C/O RETAIL
SPECIALISTS LLC PO BOX 531247 BIRMINGHAM AL 35253 Lease $16,591.96
Case 19-61688-wlh
5101 WHEELIS
CROWNE CENTRE LLC DR, STE 320 MEMPHIS TN 38117 Lease $18,544.60
FONDREN PLACE
Doc 169
2906 N STATE ST,

DEVELOPMENT CO JACKSON MS 39216 Lease $11,411.50
STE 201
HATCHER HILL &
311 S Weisgarber
ASSOCIATES GP KNOXVILLE TN 37919 Lease $14,099.62
Document
Road
PO BOX 171247,
OVERTON SQUARE LLC 825
C/O LOEB PROPERTIES VALLEYBROOK MEMPHIS TN 38119 Lease $17,626.00
INC. DR
PAVILION BUILDING LLC

Page 20 of 20
1215 Hightower
C/O EQUITABLE ATLANTA GA 30350 Lease $0.00
Trail #200
MANAGEMENT CORP
Filed 10/18/19 Entered 10/18/19 17:08:55
Desc Main
14173317v1

ATLANTA DIVISION
In re: ) Chapter 11
)
)
Debtors. ) Jointly Administered
)
MOTION OF DEBTORS FOR ENTRY OF (I) AN ORDER (A) AUTHORIZING AND

APPROVING BID PROCEDURES IN CONNECTION WITH THE SALE OF
SUBSTANTIALLY ALL OF THE DEBTORS’ ASSETS; (B) SCHEDULING AN
AUCTION AND SALE HEARING; (C) APPROVING THE MANNER AND FORM OF
NOTICES OF THE SALE, AUCTION, AND SALE HEARING; AND (D) GRANTING
RELATED RELIEF; AND (II) AN ORDER (A) APPROVING THE SALE OF
SUBSTANTIALLY ALL OF THE DEBTORS’ ASSETS FREE AND CLEAR OF ALL
INTERESTS; (B) AUTHORIZING THE ASSUMPTION AND ASSIGNMENT OF
CERTAIN EXECUTORY CONTRACTS AND UNEXPIRED LEASES;
AND (C) GRANTING RELATED RELIEF
Eat Here Brands, LLC, Babalu Atlanta #1 LLC, Babalu Atlanta #2 LLC,
Babalu Knoxville #1 LLC, Babalu Memphis #1 LLC, Babalu Memphis #2 LLC, Babalu, LLC,
and Babalu Birmingham #1 LLC (collectively, the “Debtors”) hereby move this Court
(the “Motion”), pursuant to Sections 105, 363, and 365 of title 11 of the United States Code
(the “Bankruptcy Code”) and Rules 2002, 6004, 6006, 9006, and 9008 of the Federal Rules of
Bankruptcy Procedure (the “Bankruptcy Rules”), for entry of: (i) an order (a) authorizing and
approving bid procedures for the sale of substantially all of the Debtors’ assets; (b) approving the
form of the APA (as defined below), (c) scheduling an Auction and Sale Hearing (each as
defined below); (d) approving the manner and form of notices of Sale, the Auction, and Sale
1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s federal tax
(4558); Babalu, LLC (7673); and Babalu Birmingham #1 LLC (1892). The Debtors’ mailing address is 9755
13889329v4
Hearing; and (e) granting related relief; and (ii) an order (a) approving the sale of substantially
all of the Debtors’ assets free and clear of all liens, claims, interests, and encumbrances; (b)
authorizing the assumption and assignment of certain executory contracts and unexpired leases;
and (c) granting related relief. In support of this Motion, the Debtors respectfully state as
follows:
SUMMARY OF RELIEF REQUESTED
1. The Debtors have negotiated a proposed transaction with Balu Holdings, LLC
(the “Stalking Horse Bidder; together with the Debtors, the “Parties”). The Stalking Horse
Bidder has agreed to purchase substantially all of the Debtors’ assets (the “Acquired Assets”),
subject to Court approval, pursuant to the Asset Purchase Agreement, dated September 9, 2019,
by and among the Parties (the “APA”). A true and correct copy of the APA is attached to this
Motion as Exhibit A. The APA transaction is subject to higher and better offers. In furtherance
of the Debtors’ efforts to maximize the value of their respective bankruptcy estates, they intend
to conduct an Auction for Qualified Bidders (as defined below) to seek other bids to purchase the
Acquired Assets. To further this process, the Debtors seek entry of two orders:
First, the “Bid Procedures Order” attached to this Motion as Exhibit B:
(i) authorizing and approving bid procedures (the “Bid Procedures”) for the sale of
the Acquired Assets;
(ii) approving the form of the APA;
(iii) approving procedures for the assumption and assignment of certain executory
contracts and unexpired leases;
(iii) scheduling an auction (the “Auction”) and a hearing to approve the proposed sale
of Acquired Assets (the “Sale Hearing”);
2
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(iv) approving the manner and form of Notice of the Auction and Sale Hearing for the
sale of substantially all of the Debtors’ assets free and clear of all liens, claims, interest, and
encumbrances, substantially in the form attached to this Motion as Exhibit C
(the “Sale Notice”); and
(v) granting related relief.
Second, the “Sale Order” in a form substantially similar to the proposed order to be filed2
(as may be modified by a party other than the Stalking Horse Bidder if such other party is the
Successful Bidder (as defined below)):
(i) approving and authorizing the sale of the Acquired Assets free and clear of all
liens, claims, interests, and encumbrances, except to the extent set forth in the APA or the
Successful Bidder’s asset purchase agreement;
(ii) authorizing the assumption and assignment of certain executory contracts and/or
unexpired leases, and granting related relief.
BACKGROUND
A. General Background
2. On July 30, 2019 (the “Petition Date”), the Debtors each commenced voluntary
cases (the “Bankruptcy Cases”) under Chapter 11 of the Bankruptcy Code.
3. The Debtors have continued in possession of their properties and have continued
to operate and manage their respective businesses as debtors-in-possession pursuant to
Sections 1107(a) and 1108 of the Bankruptcy Code.
4. Additional information about the Debtors’ businesses and the events leading up to
the commencement of the Bankruptcy Cases can be found in the Declaration of Ned Lidvall,
2 The Debtors will file the form of the proposed Sale Order within thirty (30) days after the filing of
this Motion.
3
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Chief Executive Officer of the Debtors, in Support of Chapter 11 Petitions and First-Day Orders
[Docket No. 5] (the “Lidvall Declaration”), which is incorporated herein by reference.
The Debtors may file further declaration(s) in support of the Bid Procedures and approval of the
proposed sale as they deem necessary under the circumstances.
5. The Court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 157 and
1334. Consideration of this Motion is a core proceeding pursuant to 28 U.S.C. § 157(b)(2). The
venue of these Bankruptcy Cases and this Motion is proper pursuant to 28 U.S.C. §§ 1408
and 1409.
6. On August 20, 2019, the Court entered a Final DIP Order in these Bankruptcy
Cases [Docket No. 69] as amended by that certain Amended Final DIP Order [Docket No. 103]
(the “Final DIP Order”), which, among other things, authorized the Debtors to use cash collateral
and the proceeds of the Debtors’ DIP loan from Origin Bank pursuant to a budget, which was
attached to the DIP Financing Motion [Docket No. 16] as Exhibit C (the “Budget”).
7. The Final DIP Order provides that it shall be a default under the DIP Order if the
Debtors fail to: (i) file a bidding procedures motion with or without a stalking horse on or before
September 10, 2019; (ii) obtain entry of a bidding procedures order within twenty-four (24) days
of Debtors’ filing of the bidding procedures motion; (iii) obtain entry of an order approving the
sale of all or substantially all of the Debtors’ assets on or before October 18, 2019, or (iv) close a
sale of all or substantially all of the Debtors’ assets on or before October 27, 2019.
8. At the first day hearing in these Bankruptcy Cases, in light of the sale milestones
set forth in the Final DIP, the Court provided the Debtors with September 26, 2019 and October
18, 2019, as placeholders for hearings to consider bidding procedures related to any proposed
4
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sale of all or substantially all of their assets and a hearing to ultimately approve a proposed sale
of the Debtors’ assets.
9. If the Stalking Horse Bidder is the Successful Bidder (as defined below) and
closes on the acquisition of the Acquired Assets, it is contemplated that the Stalking Horse
Bidder will hire substantially all of the Debtors’ current employees to continue to operate the
Debtors’ businesses.
B. The Stalking Horse Bidder’s APA
10. The following is a summary of the pertinent terms of the APA, which the Debtors
will make available to third-party bidders:3
Acquired Assets: Section 1.1 of the APA describes the Acquired Assets,
which are comprised of substantially all of the Debtors’ assets.
The Acquired Assets do not include the Excluded Assets, which are
described in Section 1.2 of the APA. Excluded Assets include all claims
and causes of actions of the Debtors against third parties, including those
arising under Sections 544, 547, 548, 549, and 550 the Bankruptcy Code.
Section 1.3 includes the assignment of certain executory contracts and
unexpired leases, which will be identified in Schedules 1.1(f) and 1.3(b) of
the APA, together with any applicable cure costs.
Assumed Liabilities: The Stalking Horse Bidder will not assume or have any
responsibility with respect to any liabilities of the Debtors or the Debtors’
customers, other than the Assumed Liabilities, which will be described in
Section 2.3of the APA.
Purchase Price: $ 3,620,000 consisting of the cash component set forth in the
APA plus the Assumed Liabilities, less cure costs up to the sum of
$100,000.
Termination: The APA may be terminated:
(i) by mutual written agreement of the Parties prior to the Closing;
3 The following summary is qualified in its entirety by reference to the provisions of the APA. In the event
of any inconsistencies between the provisions of the APA and the summary in this Motion, the terms of the APA, as
applicable, shall control. Unless otherwise defined in the summary set forth in the accompanying text, capitalized
terms shall have the meanings assigned to such terms in the APA, as applicable.
5
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(ii) by the Debtors if there has been a material breach by the Stalking
Horse Bidder, which breach the Stalking Horse Bidder has failed
to cure within thirty (30) days following its receipt of written
notice thereof from Debtors and which breach would cause the
condition set forth in Section 4.1(a) of the APA not to be satisfied;
(iii) by the Debtors upon delivery of written notice to the Stalking

Horse Bidder, if any condition precedent of the Debtors specified
in Section 4.1 shall not have been satisfied or waived and shall
have become impossible to satisfy, unless the failure of such
condition to have been satisfied was caused primarily by a material
breach by the Debtors;
(iv) by the Debtors if the Court enters the Sale Order approving a sale
to another Qualified Bidder (as defined in the Bid Procedures) or
confirming any Chapter 11 Plan involving any other Alternative
Transaction;
(v) by the Debtors upon delivery of written notice to the Stalking

Horse Bidder, if the Closing shall not have occurred on or before
5:00 p.m. (Central) on October 27, 2019, but only to the extent the
Closing has not occurred as of October 27, 2019 for reasons other
than the Debtors’ failure to meet their obligations under the APA;
(vi) by the Debtors if the Bankruptcy Cases are dismissed or converted

to cases under Chapter 7 of the Bankruptcy Code, or if any trustee
is appointed in the Bankruptcy Cases;
(vii) by the Stalking Horse Bidder if the Bid Procedures Order is not
entered by the Court by September 29, 2019;
(viii) by the Stalking Horse Bidder if the Sale is not entered by the Court
by October 18, 2019;
(ix) by the Stalking Horse Bidder if there has been a material breach by
a Debtor, which breach such Debtor has failed to cure within thirty
(30) days following its receipt of written notice thereof from the
Stalking Horse Bidder and which breach would cause the condition
set forth in Section 4.2(a) of the APA not to be satisfied;
(x) by the Stalking Horse Bidder if any condition precedent of

Purchaser specified in Section 4.2 of the APA shall not have been
satisfied or waived and shall have become impossible to satisfy,
unless the failure of such condition to have been satisfied was
caused primarily by a material breach by the Stalking Horse
Bidder;
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(xi) by the Stalking Horse Bidder if the Court enters the Sale Order
approving a sale to another Qualified Bidder or confirming any
Chapter 11 Plan involving any other Alternative Transaction;
(xii) by the Stalking Horse Bidder if the Closing shall not have occurred
on or before 5:00 p.m. (Central) on October 27, 2019, but only to
the extent the Closing has not occurred as of October 27, 2019 for
reasons other than the Stalking Horse Bidder’s failure to meet its
obligations under the APA;
(xiii) by the Stalking Horse Bidder if the Bankruptcy Cases are

dismissed or converted to cases under Chapter 7 of the Bankruptcy
Code, or if any trustee is appointed in the Bankruptcy Cases;
(xiv) by the Stalking Horse Bidder, if for any reason the Debtors are
unable, or fail, to assume and assign to the Stalking Horse Bidder
at the Closing any of the Restaurant Leases (as such term is
defined in the APA) except to the extent (x) the Stalking horse
Bidder elects in accordance with the APA that a Restaurant Lease
will not constitute a Purchased Contract (as such term is defined in
the APA) or (y) the Restaurant to which the Restaurant Lease
relates is excluded from the Contemplated Transactions (as such
term is defined in the APA) in accordance with Section 11.4 of the
APA; or
(xv) by the Stalking Horse Bidder, if the Debtors have delivered a

Casualty Notice (as such term is defined in the APA) to the
Stalking Horse Bidder in respect of a Material Casualty (as such
term is defined in the APA); provided that, the Stalking Horse
Bidder delivers such written notice no later than five (5) days after
the Debtors delivered such Casualty Notice.
Good Faith Deposit: The Stalking Horse Bidder has provided the Debtors
with a good faith deposit in the amount of $362,000.
Exclusivity Period: None.
Expense Reimbursement: A contingent expense reimbursement

(the “Expense Reimbursement”) of all actual, necessary, and documented
out of pocket expenses not to exceed $25,000 to be paid to the Stalking
Horse Bidder in the event that the Stalking Horse Bidder terminates the
APA under Section 14.4(e) of the APA and the Debtors fail to
consummate an Alternative Transaction (as such term is defined in the
APA). See Sections 12.5 and 14.4(e) of APA.
Break-Up Fee: A break-up fee of $50,000 in the event that the Debtors close
an Alternative Transaction (as such term is defined in the APA)
(the “Break-Up Fee”). See Section 12.1 through 12.4 of APA.
7
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Business Information: The Debtors have made or will make available to the
Stalking Horse Bidder all books, records, correspondence, customer lists,
and technical and financial information requested by the Stalking Horse
Bidder and relating to the Acquired Assets as of the date of the Closing.
No Successor Liability: Under the APA, the Stalking Horse Bidder will
acquire all of the Debtors’ right, title and interest in and to all of the
Acquired Assets, free and clear of any liens, claims, interests, or
encumbrances.
Sale of Avoidance Actions: Avoidance actions are excluded from the

Acquired Assets.
Sale Free and Clear of Unexpired Leases: None.
Relief from Bankruptcy Rule 6004(h): Under the APA, the Sale Order shall
provide for the waiver of the fourteen (14) day stay period under
Rule 6004(h) of the Bankruptcy Rules.
Provisions to be Highlighted Pursuant to General Order No. 26-2019
11. General Order No. 26-2019 (the “Court Procedures Order”) promulgates certain
procedures for use in complex chapter 11 cases that requires that sale motions must highlight the
following provisions (the “Highlighted Provisions”), identify the location of any such provision
in the proposed order, and justify such inclusion:
a. Sale to Insider. Section H.3.i of the Court Procedures Order requires

disclosure of provisions in which the proposed sale is to an insider. This Stalking Horse
Bidder is not an insider, so this provision is inapplicable.
b. Agreements with Management. Section H.3.ii of the Court Procedures

Order requires the disclosure of any (1) material terms of any such agreements with
management or key employees regarding future compensation and (2) what measures
have been taken to ensure the fairness of the sale in light of any such agreements. The
Stalking Horse Bidder may have general discussions with current management about
potential employment post-closing and/or bonuses to be paid during the cases should the
Stalking Horse Bidder be the Successful Purchaser. Any other Qualified Bidder shall be
permitted the opportunity to have similar discussions with current management.
c. Releases. Section H.3.iii of the Court Procedures Order requires the

disclosure of any provisions pursuant to which an entity is being released or claims are
being waived or otherwise satisfied. No releases are contemplated under the APA.
d. Private Sale/No Competitive Bidding. Section H.3.iv of the Court

Procedures Order requires disclosure of whether an auction is contemplated and highlight
8
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whether the Debtors have agreed not to solicit competitive offers or otherwise limit the
shopping of the assets to be sold. The Debtors are seeking approval of Bid Procedures
and to continue to market their assets on a post-petition basis, so this provision
is inapplicable.
e. Closing and Other Deadlines. Section H.3.v. of the Court Procedures

Order requires the disclosure of any deadlines for the closing of the sale or deadlines that
are conditions to closing. Currently, the Final DIP Order in these Bankruptcy Cases
contemplates that it shall be an event of default under the Final DIP Order unless the
Debtors: (i) file a bidding procedures motion with or without a stalking horse on or
before September 10, 2019; (ii) obtain entry of a bidding procedures order within twenty-
four (24) days of Debtors’ filing of the bidding procedures motion; (iii) obtain entry of an
order approving the sale of all or substantially all of the Debtors’ assets on or before
October 18, 2019, or (iv) close a sale of all or substantially all of the Debtors’ assets on or
before October 27, 2019.
f. Good Faith Deposit. Section H.3.vi of the Court Procedures Order

requires the disclosure of a good faith deposit and the conditions for forfeiting the
deposit. As set forth above, the Stalking Horse Bidder has provided the Debtors with a
good faith deposit in the amount of $362,000. The Bid Procedures contemplate any
proposed alternative bidder must provide a deposit equal to at least ten percent (10%) of
the cash component of the purchase price of such bid.
g. Interim Arrangements with Proposed Buyer. Section H.3.vii of the Court

Procedures Order requires the disclosure of any interim arrangement with the proposed
buyer. No interim arrangements prior to the closing are contemplated. Upon closing, the
parties may execute one or more management agreements to address any interim
arrangements necessary pending the transfer of liquor licenses to the Stalking Horse
Bidder.
12. The Debtors respectfully submit that the inclusion of the Highlighted Provisions
is required and appropriate under the circumstances.
PREPETITION MARKETING PROCESS
13. Beginning in July 2019, Debtors’ management with the assistance of
GGG Partners, LLC (“GGG”), Debtors’ financial advisor, and the Debtors’ other professional
advisors, commenced marketing efforts to locate a potential purchaser for the Debtors assets.
The Debtors attempted to find a buyer or financial partner to provide the Debtors with sufficient
resources to continue their businesses and restructuring strategy.
9
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14. As part of this pre-petition (mostly performed by company management) and
post-petition marketing process, GGG assisted the Debtors in: (a) preparing and negotiating
confidentiality agreements for prospective purchasers; (b) preparing detailed information about
the Debtors’ businesses, operations and financial condition; (c) identifying and contacting
potential purchasers; (d) establishing a data room for due diligence to be conducted by
prospective purchasers; (e) drafting a “teaser” describing the transaction; (f) evaluating proposals
from prospective purchasers; and (g) negotiating a stalking horse offer.
15. During the marketing period, GGG and the Debtors contacted over 55 potential
investors/buyers. Of those contacted, 21 parties executed confidentiality agreements and were
given operational, organizational, and financial information on the Debtors. Of those parties
executing confidentiality agreements, many made visits to the Debtors’ facilities. The Debtors
received seven letters of intent from parties interested in pursuing a deal with the Debtors.
16. No other offer or letter of intent received to date would have provided more
certainty of closing and value to the Debtors or their creditors than the APA with the Stalking
Horse Bidder. Should the Court approve Bid Procedures, the bid of the Staking Horse Bidder
will serve as the floor for all other interested parties for the Acquired Assets.
ADDITIONAL POST-PETITION MARKETING
17. After the anticipated approval of the Bid Procedures, GGG and the Debtors will
continue to market the Debtors assets to qualify any additional buyers and sell the Acquired
Assets to the highest and best bidder through a court-approved process as set forth in the
Bid Procedures.
18. The Debtors will update a transaction introduction teaser for distribution to
potential purchasers, which summary will provide a brief overview of the Debtors and their
10
13889329v4
operations. This teaser will be sent to parties that the Debtors believe might have a potential
interest in the Acquired Assets and the financial wherewithal to consummate the transaction
(including those who the Debtors have already contacted). A form of nondisclosure agreement
(“NDA”) will accompany the teaser. The NDA will be in a form materially similar to the one
executed by the Stalking Horse Bidder. For parties executing an NDA, the Debtors will provide
access to an electronic data room website (the “Data Room”), which contains financial
information as well as leases, contracts, and other documents pertaining to the Debtors’
operations and financial performance. All of the information may be accessed by potential
bidders (once such parties execute the NDA) via a secure invitation to the Data Room.
19. The Stalking Horse Bidder has provided the basis for soliciting opening bids for a
possible auction of the Acquired Assets. Pursuant to the Bid Procedures, if the Debtors receive
one or more bids from a Qualified Bidder (as defined in the Bid Procedures) an Auction will be
commenced on a date and time set by the Court. All bids for the Acquired Assets and at the
Auction must comply with the Bid Procedures approved by the Court. In the event of an
Auction, the Debtors intend to enter into a definitive asset purchase agreement with the
Successful Bidder.
20. The Debtors will, as necessary, supply further testimony and evidence at the
second hearing on this Motion (the “Sale Hearing”) outlining the steps they took to solicit offers
and ultimately consummate a deal with the Successful Bidder.
RELIEF REQUESTED
A. Bid Procedures Order
21. By this Motion, the Debtors seek entry of the Bid Procedures Order: (i) approving
the Bid Procedures (as set forth below) and establishing procedures for providing notices to
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13889329v4
parties to executory contracts and unexpired leases proposed to be assumed and assigned, and an
opportunity for such counterparties to object, as set forth in the Bid Procedures; and
(ii) scheduling the Auction (if necessary) and the Sale Hearing, and approving the form and
manner of notice thereof.
(i) The Bid Procedures and Cure Procedures
22. As described more fully in the Bid Procedures Order and summarized herein, the
Debtors seek approval to sell the Acquired Assets to a Qualified Bidder that makes the highest or
otherwise best offer for the Acquired Assets, after an additional solicitation period during which
information will be provided to any party in interest purchasing the Debtors’ assets, subject to
appropriate confidentiality agreements.
23. The Debtors will utilize the services of GGG and their legal counsel to help move
forward with the sale process. As set forth above, GGG will continue its pre-petition and post-
petition efforts to market the Debtors’ assets for sale to potential buyers and conduct a sale
process to aid the Debtors in identifying the highest and best bidder for the Acquired Assets.
Third parties engaging in this process will have the opportunity to conduct due diligence on the
Debtors and their assets, and any bidder constituting a Qualified Bidder shall be entitled to make
a bid at a live auction against the Stalking Horse Bidder for the Debtors’ assets.
24. As described more fully in the Bid Procedures, the Debtors request that
competing bids for the Acquired Assets be governed by the following procedures. 4 The Debtors
also request approval of procedures (the “Cure Procedures”) for notifying counterparties to
executory contracts and unexpired leases of potential Cure Costs (as defined below) with respect
4 The following description of the Bid Procedures is only a summary of the terms of the Bid Procedures set
forth in the Bid Procedures Order. The following summary is qualified in its entirety by reference to the provisions
of the Bid Procedures. In the event of any inconsistencies between the provisions of the Bid Procedures and the
terms herein, the terms of the Bid Procedures shall control.
12
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to those executory contracts and unexpired leases that the Debtors may seek to assume and
assign under the Successful Bidder’s asset purchase agreement.
a. Qualified Bids. The Debtors shall solicit bids through October 10, 2019
(the “Bid Deadline”). Each competing bidder other than the Stalking Horse Bidder shall, on or
before 12:00 p.m. (prevailing Eastern Time) on the Bid Deadline, deliver to the Debtors as
follows (collectively, a “Qualified Bid”):
(i) a cash deposit (via certified or bank check or wire transfer) of at

least ten percent (10%) of the cash component of the purchase price
of such bid (the “Deposit”);
(ii) reasonable proof acceptable to the Debtors, in consultation with the

official committee of unsecured creditors appointed in these
Bankruptcy Cases (the “Committee”) and Origin Bank, of the
interested party’s ability to consummate a purchase of the Acquired
Assets and assumption of any liabilities with respect to which such
bidder seeks assignment from the Debtors and provide adequate
assurance of future performance under all unexpired leases or
executory contracts with respect to which such bidder seeks
assignment from the Debtors, each on the terms set forth in such
party’s bid, including evidence of sufficient financing along with
any other financial information which a bidder believes
substantiates its ability to perform its obligations with regard to its
bid (collectively, “Financial Information”);
-and-
(iii) an executed asset purchase agreement, which asset purchase

agreement shall (1) specify the amount of cash or other
consideration offered by the competing bidder for the Acquired
Assets (provided that the cash component of such bid may not be
less than the sum of $3,720,000 (which is the sum of the cash
component of the purchase price in the Stalking Horse Bidder’s
APA, the Break-Up Fee, and $50,000); (2) not be subject to
unperformed due diligence, financing conditions, corporate
approval conditions, or regulatory approval conditions, nor provide
for any expense reimbursement; (3) constitute an irrevocable offer
by such competing bidder to complete its proposed purchase upon
the terms set forth therein, and must confirm that it is irrevocable
until closing of the sale of the Acquired Assets to the Successful
Bidder (as defined below), and provide for an outside date of
closing that is on or before October 27, 2019; (4) provide for the
purchase of substantially all of the Acquired Assets; (5) be
accompanied by a marked-up version of the APA that shows all
differences between such asset purchase agreement and the APA
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(which was filed with the Court as Exhibit A to the Sale Motion);
(6) contain a list of the Debtors’ executory contracts and unexpired
leases with respect to which the bidder seeks assignment from the
Debtors; (7) fully disclose the identity of each entity that will be
bidding for the Acquired Assets or otherwise participating in
connection with such bid; and (8) indicate whether such competing
bidder agrees to act as the Back-Up Bidder (as defined below) in
the event that such competing bidder is not the Successful Bidder
(as defined below), as well as identify any date past which it would
not serve as the Back-Up Bidder.
If the competing bidder is an entity formed for the purpose of a sale

transaction, then such entity must provide financial disclosure acceptable
to Debtors that demonstrates such competing bidder’s financial ability to
consummate a competing sale transaction. A competing bidder also must
establish that it has the financial ability to consummate its proposed
transaction by no later than October 10, 2019. In order to participate in
the bidding process, receive due diligence materials, and/or otherwise be
considered for any purpose hereunder, a competing bidder must first
deliver an executed confidentiality agreement in form and substance
satisfactory to the Debtors and their counsel, which confidentiality
agreement will be made available to, among others, those interested
parties that contact Debtors’ counsel, provided that, if any competing
bidder is or is affiliated with a competitor of the Debtors, the Debtors will
not be required to disclose to such competing bidder any trade secrets or
proprietary information. If the Debtors determine that a competing bidder
does not constitute a Qualified Bidder (as defined below), then such
competing bidder’s ability to receive due diligence access or additional
non-public information shall terminate, except as otherwise agreed by the
Debtors.
b. Credit Bid by Prepetition and DIP Lender. Origin Bank, serves as the
Debtors’ prepetition secured lender and the Debtors’ post-petition secured lender in these
Bankruptcy Cases. Origin Bank shall be entitled to credit bid up to the full value of its pre-
petition and post-petition secured claims totaling $5,596,700.00 plus any amounts then extended
to the Debtors under the DIP loan (which additional amount shall be provided to any Qualified
Bidder at the Auction).
c. Qualified Bidders. Any initial overbid for the Acquired Assets shall be in
the amount equal to the sum of $3,720,000. In the event that the Debtors shall reasonably
determine that such overbid is a higher and better bid than that set forth in the APA, the Stalking
Horse Bidder shall have the right to amend the APA as necessary in its reasonable discretion, as
agreed with the Debtors, in order to cause the Stalking Horse Bidder’s bid format to be
comparable to such higher and better bid (for the avoidance of doubt, the amendment of the APA
by the Stalking Horse Bidder will in no event result in the cancellation of the Auction if the
Debtors have received at least one (1) other Qualified Bid). Only those persons or entities who
have submitted a Qualified Bid in compliance with the Bid Procedures Order shall be
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a “Qualified Bidder”; provided, however, that the Stalking Horse Bidder shall be deemed to be a
Qualified Bidder for all purposes under the Bid Procedures. Each Qualified Bidder shall be
invited to attend the Auction at the law office of Debtors’ counsel of record, Arnall Golden
Gregory LLP, 171 17th Street, N.W., Suite 2100, Atlanta, Georgia 30363-1031, which Auction
must be attended in person by the Qualified Bidder or an authorized representative of the
Qualified Bidder.
d. Identity of Bidders. In addition to the information required above, each

competing bidder other than the Stalking Horse Bidder shall, on or before October 10, 2019,
provide written identification of the bidder, its principals, and the representatives thereof who are
authorized to appear and act on their behalf for all purposes regarding the contemplated
transaction and written disclosure of any connections or agreements with the Debtors, the
Stalking Horse Bidder, any other known potential bidder, and/or any officer, director, manager,
or direct or indirect equity security holder of the Debtors.
e. The Auction. The Auction shall commence at 10:00 a.m. (Eastern) on

October 16, 2019 at the law office of Debtors’ counsel of record, Arnall Golden Gregory LLP,
171 17th Street, N.W., Suite 2100, Atlanta, Georgia 30363-1031. The Acquired Assets shall be
sold free and clear of all liens, claims, interests, and encumbrances to the fullest extent allowed
under Section 363(f) of the Bankruptcy Code and applicable law. The following rules shall
govern the Auction:
i. At least 24 hours prior to the Auction, the Debtors will notify all
Qualified Bidders in writing of the highest and best Qualified Bid,
as determined by Debtors, in consultation with the Committee and
Origin Bank, which may be the APA (the “Baseline Bid”).
Complete copies of all asset purchase agreements, amendments to
the APA, and all other bid materials submitted by each other
Qualified Bidder will be available to each other Qualified Bidder
upon request to Debtors’ counsel of record.
ii. Only Qualified Bidders may bid at the Auction. If multiple

Qualified Bids are received, each Qualified Bidder shall have the
right to continue to improve its Qualified Bid at the Auction.
Bidding at the Auction shall proceed in increments of at least
$25,000 (the “Bidding Increment”), and the Bidding Increment
may be increased in the Debtors’ discretion. Only the authorized
representatives of each of the Stalking Horse Bidder and any other
Qualified Bidder, the Debtors, Origin Bank, the Committee, and
United States Trustee shall be permitted to attend the Auction,
except as otherwise expressly ordered by the Court.
iii. At the conclusion of the Auction, subject to Court approval

following the Auction, the highest and best offer shall be selected
and announced as the successful bidder by the Debtors
(the “Successful Bidder”), and the bid of the bidder that submits
the next highest and best bid (designated in accordance with the
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Debtors’ business judgment), in consultation with the Committee

and Origin Bank, shall be selected and announced by the Debtors
(the “Back-Up Bid” by the “Back-Up Bidder”); provided,
however, that designation of such bidder as the Back-Up Bidder
must be consistent with the asset purchase agreement submitted in
connection with such bidder’s bid. For the avoidance of doubt, if
there are no Qualified Bidders who agree to act as the Back-Up
Bidder, then there shall be no Back-Up Bidder. There will be no
further bids or offers considered by the Debtors following the
conclusion of the Auction and the announcement of the Successful
Bidder and, as applicable, the Back-Up Bidder.
iv. If the Debtors do not receive at least one Qualified Bid from a
Qualified Bidder other than the Stalking Horse Bidder, then (1) no
Auction shall be conducted, the Debtors and the Stalking Horse
Bidder are authorized to move forward with the transactions
contemplated by the APA (subject to the entry of the Sale Order)
and the Sale Hearing, the transaction consideration contemplated
by the APA will be determinative of the value of the Acquired
Assets, and the Court shall not consider any competing or
alternative offers or proposals to purchase the Acquired Assets;
and (2) the Debtors will file on the docket in the Lead Bankruptcy
Case a “Notice of Cancellation of Auction.”
v. The Auction may be adjourned from time to time by the Debtors,

provided that, no such adjournment shall affect the rights of the
Stalking Horse Bidder under the APA. Reasonable notice of such
adjournment and the time and place for the resumption of the
Auction shall be given to the Stalking Horse Bidder, all Qualified
Bidders that have submitted a Qualified Bid, and counsel for
Origin Bank, counsel for the Committee, and the
United States Trustee.
f. Successful Bidder. The Debtors may base the selection of the Successful
Bidder and Back-Up Bidder on the following factors, among others: purchase price, liabilities
assumed in the bid (provided that in no event shall the cash component required for a Qualified
Bid be reduced as a result of a bidder’s proposed assumption of liabilities), retention of the
Debtors’ employees, the markup of the form of asset purchase agreement submitted with the bid,
and the apparent ability of a Qualified Bidder to close the proposed transaction. The Debtors
may (a) reject any bid that is (i) inadequate or insufficient, (ii) not in conformity with the
requirements of the Bankruptcy Code, the Bid Procedures, or the terms and conditions of sale, or
(iii) contrary to the best interests of the Debtors, their bankruptcy estates, and their creditors;
and/or (b) refuse to consider any bid that fails to comply with the Bid Procedures. After the
determination of the Successful Bidder, the Debtors shall (i) if the Successful Bidder is a bidder
other than the Stalking Horse Bidder, promptly execute the asset purchase agreement previously
executed and submitted by such Successful Bidder, together with any changes thereto
necessitated by the parties’ actions at the Auction, or (ii) if the Successful Bidder is the Stalking
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Horse Bidder, move forward with the transactions contemplated by the APA. All rights of the
Stalking Horse Bidder, (if any) to object to the Debtors’ selection of a Successful Bidder or
Back-Up Bidder, or to object to the consummation of the sale transaction represented by either
such bid, are preserved and shall be considered by the Court at the Sale Hearing.
g. Back-Up Bidder. If the Successful Bidder fails to consummate an

approved sale in accordance with the applicable asset purchase agreement or such agreement is
terminated (or, in the event that the Stalking Horse Bidder is the Successful Bidder, the Parties
fail to consummate the transactions contemplated by the APA or the APA is terminated), (i) the
Debtors shall be authorized to deem the Back-Up Bid the Successful Bid, and the Debtors shall
be authorized to consummate the sale with the Back-Up Bidder without further order of the
Court (or, in the event that the Stalking Horse Bidder is the Back-Up Bidder, move forward with
the transaction contemplated by the APA, subject to the APA); provided, however, that if the
Stalking Horse Bidder is the Successful Bidder, the Back-Up Bidder shall remain the Back-Up
Bidder in accordance with the Back-Up Bidder’s asset purchase agreement; and (ii) the Deposit
provided by such defaulting bidder shall be forfeited to the Debtors in accordance with the
defaulting bidder’s asset purchase agreement. The Debtors specifically reserve the right to seek
all appropriate damages or equitable remedies from a defaulting Successful Bidder or Back-
Up Bidder.
h. Modification of Bidding and Auction Procedures. The Debtors, in their

sole discretion, may modify the Bid Procedures with respect to the Bid Deadline, whether a bid
that materially complies with the requirements of the Bid Procedures (as determined by the
Debtors in the reasonable exercise of their business judgment consistent with their fiduciary
duties) is a Qualified Bid, and the time, manner, and place of the Auction; provided, however,
that the Bid Procedures may not be otherwise modified except with the express written consent
of the Debtors and the Stalking Horse Bidder; provided, further, however, that in no event may
the Bid Procedures be modified to reduce the required cash component of a Qualified Bid.
All rights of the Stalking Horse Bidder in respect of any modification of the Bid Procedures by
the Debtors are preserved. The Debtors may make such modification to the Bidding Procedures
as are necessary and not inconsistent with the Bid Procedures Order.
i. Contract Cure Procedures. To the extent a Qualified Bidder seeks

approval in the Sale Order (as defined in the Motion) of the assumption and assignment of
executory contracts and/or unexpired leases, the following procedures (the “Cure Procedures”)
shall apply for notifying counterparties to executory contracts and unexpired leases of potential
Cure Amounts (as defined below).
i. Within two days (2) days after the Bid Deadline the Debtors will
file a notice of potential assumption, assignment, and/or transfer of
executory contracts and unexpired leases identified by each
Qualified Bidder (the “Designated Executory Contracts”),
substantially in the form attached to this Motion as Exhibit D
(the “Notice of Assumption and Assignment”), and serve such
notice on all non-debtor parties to the Designated Executory
Contracts (the “Contract Notice Parties”). For avoidance of doubt,
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the Debtors shall file a Notice of Assumption related to the APA

within two days (2) of the entry of the Bid Procedures Order, and
serve such notice on all of the Contract Notice Parties.
ii. The Notice of Assumption and Assignment shall identify the

calculation of the cure amounts, if any, that the Debtors believe
must be paid to cure all defaults outstanding under each of the
Designated Executory Contracts (the “Cure Costs”) as of such
date. The Notice of Assumption and Assignment shall also contain
information regarding how a non-debtor party to a Designated
Executory Contract may obtain adequate assurance of future
performance information from the applicable Qualified Bidder
(the “Adequate Assurance Information”). The Notice of
Assumption and Assignment shall provide that a non-debtor party
to a Designated Executory Contract may object to the Cure Costs,
the Adequate Assurance Information or the assumption and
assignment of such executory contract or unexpired lease at the
Sale Hearing or at a later hearing, as determined by the Debtors
subject to the Court’s calendar.
(j) Break-Up Fee. In the event the Successful Bidder is deemed to be a

person or entity other than the Stalking Horse Bidder, and such Successful Bidder successfully
closes on the sale of the Debtors’ assets, then, upon such closing, the Debtors shall pay the
Break-Up Fee in the amount of $50,000 to the Stalking Horse Bidder.
(ii) Approval of the APA
25. The Debtors further seek approval of the APA and approval for the Debtors to
assume the APA, subject to the Bidding Procedures and auction process. As set forth above, the
APA provides the framework for consummating the transactions negotiated between the Debtors
and the Stalking Horse Bidder.
26. The DIP Loan procured by the Debtors matures on October 27, 2019. The
timeline provided in this Motion contemplates a continued marketing and sale process, an
opportunity for third parties to conduct due diligence on the Debtors’ assets, an auction and
subsequent sale all within this period and prior to the maturity of the DIP Loan. If the DIP Loan
were to mature before the closing of the sale, the Debtors would deplete their funds and may be
unable to operate, including make payments to their employees, vendors, and their other
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creditors. As a result, the Debtors may experience a cessation of business, destroying all going
concern value and seriously harming the Debtors and their respective bankruptcy estates.
27. Given the Debtors marketing efforts to date, the proposed timeline is sufficient to
permit third parties interested in purchasing the Acquired Assets to conduct due diligence and
tender a bid. Interested parties will have sufficient notice of the proposed sale and an
opportunity to consider and digest the terms of the APA to determine whether tendering a bid is
in their best interests, thereby maximizing the likelihood of competitive bidding under the
circumstances. In light of the Debtors’ limited resources, the proposed timeline sets out a
framework that will maximize the value of the Debtors’ with minimal cost, which is in the best
interests of the Debtors and their bankruptcy estates.
(iii) Notice Related to Proposed Sale
28. Notice of Bid Procedures Hearing. On the date that this Motion is filed, the
Debtors propose to serve this Motion and all exhibits thereto, including the APA, and a copy of
the proposed Bid Procedures Order, by first-class mail, postage prepaid, upon the following
parties: (i) all parties identified on the Master Service List in these Bankruptcy Cases, and (ii) via
electronic mail5 on all persons or entities known or reasonably believed to have an interest in
purchasing the Acquired Assets. The Debtors also propose to serve any Order and Notice or
Notice of Hearing related to this Motion upon the following parties: (i) the entire creditor matrix
in each of these Bankruptcy Cases and (ii) via electronic mail on all persons or entities known or
reasonably believed to have an interest in purchasing the Acquired Assets.
29. Notice of Bid Procedures Order and Bidding Procedures, Auction, and
Sale Hearing. The Debtors propose to file the Sale Notice substantially in the form attached to
5 The Debtors contacted parties interested in purchasing the Acquired Assets, including the Stalking Horse
Bidder, via electronic mail.
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this Motion as Exhibit C and serve such notice upon: (i) the entire creditor matrix in each of the
Bankruptcy Cases and (ii) via electronic mail on all persons or entities known or reasonably
believed to have an interest in purchasing the Acquired Assets. The Debtors also propose to file
a Notice of Assumption related to the Designated Executory Contracts in the APA within two
days (2) of the entry of the Bid Procedures Order, and serve such notice on all of the Contract
Notice Parties.
30. Post-Auction Notice. As soon as possible after the conclusion of the Auction, the
Debtors shall file, but not serve, a notice identifying the highest and best bid selected and
announced by the Debtors as the Successful Bidder, and the bid of the Back-Up Bidder. In the
event that the Successful Bidder identifies any additional executory contracts or unexpired leases
that it did not previously designate as Designated Executory Contracts, the Debtors shall file a
Notice of Assumption and Assignment identifying such additional agreements, and serve such
notice on all of the Contract Notice Parties for those agreements.
31. Notice of Cure Related to Designated Contracts by Qualified Bidders Other than
the Staking Horse Bidder. Within two days (2) days after the Bid Deadline the Debtors propose
to file a Notice of Assumption and Assignment substantially in the form attached to this Motion
as Exhibit D specifying the Designated Executory Contracts identified by each Qualified Bidder,
and serve such notice on all of the Contract Notice Parties.
B. Sale Order
32. The Debtors request that this Court set the Sale Hearing on or about
October 18, 2019. At the Sale Hearing, pending the outcome of the Auction and as set forth in
the Bid Procedures, the Debtors intend to seek entry of a Sale Order (a) approving the sale to the
Successful Bidder, free and clear of all liens, claims, interests, and encumbrances
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(collectively, “Interests”), (b) authorizing the assumption and assignment of the Designated
Executory Contracts identified by the Successful Bidder; and (c) authorizing the Debtors to pay
Origin Bank at closing: (i) the amount of sales proceeds necessary to repay Origin Bank’s post-
petition DIP loan in full and (ii) not less than fifty percent (50%) of all excess sales proceeds
(after considering all then budgeted administrative expenses) toward satisfaction of the Pre-
Petition Obligations (as defined in the Final DIP Order), provided that, (a) the Challenge Period
(as defined in the Final DIP Order) shall have expired on or before the closing of the Sale and
(b) no party with standing has filed a Challenge Action (as defined in the Final DIP Order) prior
to the expiration of the Challenge Period.
BASIS FOR RELIEF REQUESTED
33. The business judgment rule “operates as a presumption ‘that directors making a
business decision, not involving self-interest, act on an informed basis, in good faith and in the
honest belief that their actions are in the corporation’s best interest.’” Continuing Creditors’
Comm. of Star Telecomms., Inc. v. Edgecomb, 385 F. Supp. 2d 449, 462 (D. Del. 2004) (quoting
Grobow v. Perot, 539 A.2d 180, 187 (Del. 1988)); see also In re Diplomat Constr., Inc.,
481 B.R. 215, 218-19 (Bankr. N.D. Ga. 2012) (Diehl, J.); Ad Hoc Comm. of Equity Holders of
Tectonic Network, Inc. v. Wolford, 554 F. Supp. 2d 538, 555 n.111 (D. Del. 2008); In re Bal
Harbour Club, Inc., 316 F.3d 1192, 1194-95 (11th Cir. 2003); Int’l Ins. Co. v. Johns, 874 F.2d
1447, 1458 (11th Cir. 1989). Thus, this Court should grant the relief requested in this Motion if
the Debtors demonstrate a sound business justification in favor of the requested relief. See In re
Del. Hudson Ry. Co., 124 B.R. 169, 179 (Bankr. D. Del. 1991).
34. The Debtors have determined that a sale of their assets in accordance with the
APA after their marketing and sale process will be the most effective way to maximize the value
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of the Debtors’ bankruptcy estates for the benefit of their creditors in view of the Debtors’ pre
and post-petition marketing efforts to date and the Debtors’ limited resources. The proposed
transaction will also preserve the employment of many the Debtors’ employees. The Debtors
believe that the proposed Bid Procedures will bring the highest and best offer for the Debtors’
assets under the circumstances. The Debtors believe that the assumption of the APA, the
implementation of the Bid Procedures and the timeline proposed in this Motion will further
achieve this goal. Absent approval of the sale of the Acquired Assets to the highest and best
bidder, the Debtors will likely face a piecemeal liquidation and the termination of all of their
employees. As such, the Debtors believe that they have demonstrated a sound business
justification for the relief requested in the Motion.
A. Bid Procedures
35. The Bid Procedures – including the provision of the Break-Up Fee and contingent
Expense Reimbursement – are appropriate to generate maximum value for the Debtors’
stakeholders. The Bid Procedures, inter alia, (i) will provide opportunity to further market the
Debtors’ assets and provide potential bidders with sufficient notice and an opportunity to acquire
information necessary to submit a timely and informed bid, (ii) are designed to maximize the
value received for the Acquired Assets in view of the Debtors’ limited resources by providing
maximum opportunity to engender a competitive bidding process in which all potential bidders
are encouraged to participate and submit competing bids, and (iii) will provide the Debtors with
the opportunity to consider all competing offers and to select the highest or otherwise best offer
for the sale of substantially all of the Debtors’ assets.
36. The proposed Break-Up Fee of $50,000 (which is less than 1.5% of the cash
component of the purchase price in the APA) and contingent Expense Reimbursement of
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$25,000 (which is only payable in the event that the Debtors materially default and do not close
an Alternative Transaction) are necessary to compensate the Stalking Horse Bidder for funds and
other resources deployed to conduct due diligence on the Debtors’ assets, negotiate the APA
with the Debtors, and participate in the sale process. The due diligence and negotiation
performed by the Stalking Horse Bidder have been necessary to providing the market with an
indication of the value of the Debtors’ assets and has provided a benchmark for third parties to
determine whether to submit a bid. The Stalking Horse Bidder has provided significant benefit
to the Debtors’ bankruptcy estates and would not have participated in the sale process absent the
Break-Up Fee and contingent Expense Reimbursement. Accordingly, the Debtors respectfully
submit that the Break-Up Fee and contingent Expense Reimbursement are warranted and
constitute a reasonable exercise of their business judgment.
37. The Debtors request this Court’s approval of the Bid Procedures, including the
Break-Up Fee and contingent Expense Reimbursement and the dates established thereby for an
Auction and a Sale Hearing (including shortening notice). Accordingly, the Debtors and all
parties-in-interest can be assured that the consideration for the Acquired Assets will be fair and
reasonable, and there are sound business reasons to approve the Bid Procedures.
B. The Assumption and Assignment of Executory Contracts and Unexpired

Leases and the Cure Procedures
38. Section 365(a) of the Bankruptcy Code provides, in pertinent part, that a debtor in
possession “subject to the court’s approval, may assume or reject any executory contract or
[unexpired] lease of the debtor.” 11 U.S.C. § 365(a). The standard governing bankruptcy court
approval of a debtor’s decision to assume or reject an executory contract or unexpired lease is
whether the debtor’s reasonable business judgment supports assumption or rejection. See e.g.,
In re Stable Mews Assoc., Inc., 41 B.R. 594, 596 (Bankr. S.D.N.Y. 1984). If the debtor’s
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business judgment has been reasonably exercised, a court should approve the assumption or
rejection of an unexpired lease or executory contract. See Sharon Steel Corp. v. Nat’l Fuel Gas
Distrib. Corp., 872 F.2d 36, 39-40 (3rd. Cir. 1989).
39. The business judgment test “requires only that the trustee [or debtor-in-
possession] demonstrate that [assumption or] rejection of the contract will benefit the estate.”
Wheeling-Pittsburgh Steel Corp. v. West Penn Power Co. (In re Wheeling-Pittsburgh Steel
Corp.), 72 B.R. 845, 846 (Bankr. W.D. Pa. 1987) (quoting In re Stable Mews Assoc., 41 B.R.
594, 596 (Bankr. S.D.N.Y. 1984)). Any more exacting scrutiny would slow the administration
of a debtor’s estate and increase costs, interfere with the Bankruptcy Code’s provision for private
control of administration of the estate, and threaten this Court’s ability to control a case
impartially. See Richmond Leasing Co. v. Capital Bank, N.A., 762 F.2d 1303, 1311 (5th Cir.
1985). Moreover, pursuant to Section 365(b)(1) of the Bankruptcy Code, for a debtor to assume
an executory contract, it must “cure, or provide adequate assurance that the debtor will promptly
cure,” any default, including compensation for any “actual pecuniary loss” relating to such
default. 11 U.S.C. § 365(b)(1).
40. Once an executory contract is assumed, the trustee or debtor-in-possession may
elect to assign such contract. See In re Rickel Home Ctr., Inc., 209 F.3d 291, 299 (3d Cir. 2000)
(“The Code generally favors free assignability as a means to maximize the value of the debtor’s
estate.”); see also In re Headquarters Doge, Inc., 13 F.3d 674, 682 (3d Cir. 1994)
(noting purpose of Section 365(f) is to assist trustee in realizing the full value of the
debtor’s assets).
41. Section 365(f) of the Bankruptcy Code provides that the “trustee may assign an
executory contract . . . only if the trustee assumes such contract . . . and adequate assurance of
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future performance is provided.” 11 U.S.C. § 365(f)(2). The meaning of “adequate assurance of
future performance” depends on the facts and circumstances of each case, but should be given
“practical, pragmatic construction.” See Carlisle Homes, Inc. v. Arrari (In re Carlisle Homes,
Inc., 103 B. R. 524, 538 (Bankr. D.N.J. 1989); see also In re Natco Indus., Inc., 54 B.R. 436, 440
(Bankr. S.D.N.Y. 1985) (adequate assurance of future performance does not mean absolute
assurance that debtor will thrive and pay rent). Among other things, adequate assurance may be
given by demonstrating the assignee’s financial health and experience in managing the type of
enterprise or property assigned. See In re Bygaph, Inc., 56 B.R. 596, 605-06 (Bankr. S.D.N.Y.
1986) (adequate assurance of future performance is present when a prospective assignee of a
lease from debtor has financial resources and has expressed willingness to devote sufficient
funding to business in order to give it strong likelihood of succeeding).
42. Adequate assurance of future performance shall be presented at the Sale Hearing.
If necessary, the Debtors will adduce facts at the Sale Hearing to refute any objection,
demonstrating the financial wherewithal of the Successful Bidder, and its willingness and ability
to perform under any executory contracts and unexpired leases to be assumed and assigned.
The Sale Hearing therefore will provide this Court and other interested parties with ample
opportunity to evaluate and, if necessary, challenge the ability of any Successful Bidder to
provide adequate assurance of future performance under the executory contracts and unexpired
leases that the Debtors seeks to assume and assign.
43. Accordingly, the Debtors believe that the procedures proposed in this Motion for
executory contracts and unexpired leases being assumed and assigned on the Closing Date are
appropriate and reasonably tailored to provide Contract Notice Parties with adequate notice in
the form of the Notice of Potential Assignment and Assumption of the proposed assumption
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and/or assignment of their applicable executory contract or unexpired lease, as well as proposed
Cure Amounts, if applicable.
44. Furthermore, to the extent that any defaults exist under any executory contract or
unexpired lease that is to be assumed and assigned in connection with any sale of the Assets, the
Successful Bidder or the Debtors (as applicable under the Successful Bidder’s asset purchase
agreement) will cure any such default contemporaneously with or as soon as practicable after
consummation of an assumption and assignment of such executory contract or unexpired lease.
45. Accordingly, this Court therefore has a sufficient basis to authorize the Debtors to
assume and assign executory contracts and unexpired leases as may be set forth in any
Successful Bidder’s asset purchase agreement.
C. Approval of the Sale
(i) The Sale is an Appropriate Exercise of the Debtors’ Business

Judgment
46. Section 363(b)(1) of the Bankruptcy Code provides that a debtor, “after notice
and a hearing, may use, sell, or lease, other than in the ordinary course of business, property of
the estate.” 11 U.S.C. § 363(b)(1). Although Section 363 of the Bankruptcy Code does not
specify a standard for determining when it is appropriate for a court to authorize the use, sale or
lease of property of the estate, bankruptcy courts have found that a debtor’s sale or use of assets
outside the ordinary course of business should be approved if the debtor can demonstrate a sound
business justification for the proposed transaction. See, e.g., In re Eagle Picher Holdings, Inc.,
2005 Bankr. LEXIS 2894, at ¶ 3 (Bankr. S.D. Ohio 2005); In re Martin, 91 F.3d 389, 395 (3d
Cir. 1996); In re Abbotts Dairies of Pa., Inc., 788 F.2d 143 (3d Cir. 1986); In re Lionel Corp.,
722 F.2d 1063, 1071 (2d Cir. 1983). Once a debtor articulates a valid business justification,
“[t]he business judgment rule ‘is a presumption that in making the business decision the directors
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of a corporation acted on an informed basis, in good faith and in the honest belief that the action
was in the best interests of the company.’” In re S.N.A. Nut Co., 186 B.R. 98 (Bonier. N.D. Ill.
1995); see also In re Integrated Res., Inc., 147 B.R. 650, 656 (Bankr. S.D.N.Y. 1992); In re
Johns-Manville Corp., 60 B.R. 612, 615-16 (Bankr. S.D.N.Y. 1986) (“a presumption of
reasonableness attaches to a Debtor’s management decisions”).
47. The sale of a debtor’s assets is appropriate where there are sound business reasons
behind such a determination. See Myers v. Martin (In re Martin), 91 F.3d 389, 395 (3d Cir.
1996); see also Dai-Ichi Kangyo Bank, Ltd. v. Montgomery Ward Holding Corp., (In re
Montgomery Ward Holding Corp.), 242 B.R. 147, 153 (Bankr. D. Del. 1999); In re Del. &
Hudson Ry. Co., 124 B.R. 169, 176 (D.D.C. 1991); Stephens Indus., Inc. v. McClung, 789 F.2d
386 (6th Cir. 1986) (sale of substantially all assets of estate authorized where “a sound business
purpose dictates such action”).
48. The Debtors have negotiated the APA with the Stalking Horse Bidder, which is an
arm’s length third party with a knowledge and understanding of the Acquired Assets and their
value. The Debtors will utilize a period of time during which interested third parties may
conduct diligence into the Debtors’ assets and submit a competing bid therefor. If one or more
Qualified Bids are received in addition to the APA, the Debtors will hold an open auction and
choose which proposal will provide the maximum benefit for the Debtors’ creditors. If the APA
is the Successful Bid, it will constitute the highest and best offer for the Debtors’ assets
attainable.
49. In addition, all creditors and parties in interest will receive adequate notice of the
Bid Procedures and Sale Hearing as set forth above. Such notice is reasonably calculated to
provide timely and adequate notice to the Debtors’ major creditor constituencies, those parties
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most interested in these Bankruptcy Cases, those parties potentially interested in bidding on the
Acquired Assets, and others whose interests are potentially implicated by any proposed
sale transaction.
50. Given the Debtors’ financial condition and current circumstances, the Debtors
reasonably determined that the most effective way to preserve the value of their assets for the
benefit of all of their stakeholders is through sale of the Acquired Assets in accordance with the
process and Bid Procedures proposed in this Motion.
(ii) Sale Free and Clear of Liens, Claims, Interests, and Encumbrances
51. Section 363(f) of the Bankruptcy Code permits a debtor to sell assets free and
clear of all liens, claims, interests, and encumbrances (with any such liens, claims, interests, and
encumbrances attaching to the net proceeds of the sale with the same rights and priorities therein
as in the sold assets). Section 363(f) of the Bankruptcy Code authorizes a debtor to sell assets
free and clear of such interests in property if:
(a) applicable non-bankruptcy law permits a sale of such property free and
clear of such interest;
(b) such entity consents;
(c) such interest is a lien and the price at which such property is to be sold is
greater than the aggregate value of all liens on such property;
(d) such interest is in bona fide dispute; or
(e) such entity could be compelled, in a legal or equitable proceeding, to
accept a money satisfaction of such interest.
11 U.S.C. § 363(f).
52. Because Section 363(f) of the Bankruptcy Code is drafted in the disjunctive,
satisfaction of any one of its five requirements will suffice to permit the sale of the Acquired
Assets “free and clear” of all Interests. See Mich. Emp’t Sec. Comm’n v. Wolverine Radio Co.
(In re Wolverine Radio Co.), 930 F.2d 1132, 1147 n.24 (6th Cir. 1991) (stating that Bankruptcy
Code section 363(f) is written in the disjunctive; holding that the court may approve the sale
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“free and clear” provided at least one of the subsections of Bankruptcy Code Section 363(f) is
met); In re Trans World Airlines. Inc., No. 01-0056, 2001 WL 1820325, at *3 (Bankr. D. Del.
Mar. 27, 2001) (“Bankruptcy courts have long had the authority to authorize the sale of estate
assets free and clear even in the absence of § 363(f).”); Citicorp Homeowners Servs., Inc. v.
Elliot, 94 B.R. 343, 345 (Bankr. E.D. Pa. 1988) (stating that Section 363(f) of the Bankruptcy
Code is written in the disjunctive; holding that if any of the five conditions of Section 363(f) are
met, the trustee has the authority to conduct the sale free and clear of all liens).
53. One or more of the prongs of Section 363(f) have been satisfied with respect to
each of the Acquired Assets. The Debtors’ believe that their senior secured lender, Origin Bank,
has consented to the proposed sale provided that the Bid Procedures are followed. In addition,
notice of the Debtors’ intent to sell the Acquired Assets to the Successful Bidder free and clear
of all Interests have been provided to all of the Debtors’ creditors and other interested parties,
with ample opportunity to object. Absent objection, such parties should be deemed to have
consented to the sale free and clear of any Interest in the Acquired Assets sold, with such
Interests attaching to the proceeds of such sale. If applicable, the Debtors are prepared to
demonstrate at the Sale Hearing that they have satisfied one or more of the prongs of
Section 363(f) of the Bankruptcy Code to the extent this Motion draws objection of any
interested party.
54. The Debtors also request that they be authorized to disburse the proceeds of the
sale of the Acquired Assets sufficient to repay Origin Bank’s post-petition DIP loan in full and
not less than fifty percent (50%) of all excess sales proceeds (after considering all then budgeted
administrative expenses) toward satisfaction of the Pre-Petition Obligations (as defined in the
Final DIP Order), provided that, (a) the Challenge Period (as defined in the Final DIP Order)
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shall have expired on or before the closing of the Sale and (b) no party with standing has filed a
Challenge Action (as defined in the Final DIP Order) prior to the expiration of the
Challenge Period.
(iii) The Successful Bidder Should be Entitled to the Protections of

Section 363(m)
55. Pursuant to Section 363(m) of the Bankruptcy Code, a good faith buyer is one
who purchases assets for value, in good faith, and without notice of adverse claims. See In re
Abbotts Dairies, 788 F.2d at 147; In re Mark Bell Furniture Warehouse, Inc., 992 F.2d 7, 9
(1st Cir. 1993); In re Willemain v. Kivitz, 764 F.2d 1019, 1023 (4th Cir. 1985).
Specifically, Section 363(m) states that:
The reversal or modification on appeal of an authorization under [section 363(b)]

... does not affect the validity of a sale ... to an entity that purchased ... such
property in good faith, whether or not such entity knew of the pendency of the
appeal, unless such authorization and such sale ... were stayed pending appeal.
11 U.S.C. § 363(m).
56. Section 363(m) “fosters the ‘policy of not only affording finality to the judgment
of the bankruptcy court, but particularly to give finality to those orders and judgments upon
which third parties rely.’” In re Chateaugay Corp., Case No. 92 CIV. 7054 (PKL), 1993 WL
159969, *3 (S.D.N.Y. May 10, 1993) (quoting In re Abbotts Dairies of Penn., Inc., 788 F.2d 143
at 147); see also Allstate Ins. Co. v. Hughes, 174 B.R. 884, 888 (S.D.N.Y. 1994)
(“Section 363(m) . . . provides that good faith transfers of property will not be affected by the
reversal or modification on appeal of an unstayed order, whether or not the transferee knew of
the pendency of the appeal”); In re Stein & Day, Inc., 113 B.R. 157, 162 (Bankr. S.D.N.Y. 1990)
(“pursuant to 11 U.S.C. § 363(m), good faith buyers are protected from the reversal of a sale on
appeal unless there is a stay pending appeal”).
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57. The Stalking Horse Bidder is a third party unrelated to the Debtors that has
conducted considerable due diligence on the Acquired Assets and negotiated the APA from an
arm’s length position. The Stalking Horse Bidder has been represented by third party legal
counsel in connection with the negotiations of the APA. If the Successful Bidder is the Stalking
Horse Bidder, the Stalking Horse Bidder will have been selected as the highest and best bid after
a sale process market-tested by the Auction. In such a case, the Debtors respectfully request that
the Stalking Horse Bidder be afforded “good faith” buyer status within the meaning of
Section 363(m) of the Bankruptcy Code.
58. If applicable, the Debtors will adduce facts at the Sale Hearing demonstrating that
the Successful Bidder for the Acquired Assets had negotiated at arm’s length, with all parties
represented by their own counsel. Accordingly, the Sale Order will include a provision that the
Successful Bidder for the Acquired Assets is a “good faith” buyer within the meaning of
Section 363(m) of the Bankruptcy Code. The Debtors believe that providing any
Successful Bidder engaging in a sale transaction with such protection will ensure that the
maximum price will be received by the Debtors for the Acquired Assets, and that the closing of
any sale will occur promptly.
D. Relief Under Bankruptcy Rules 6004(h) and 6006(d) is Appropriate
59. Rule 6004(h) of the Bankruptcy Rules provides that an “order authorizing the use,
sale or lease of property . . . is stayed until the expiration of 14 days after entry of the order,
unless the court orders otherwise.” Additionally, Rule 6006(d) of the Bankruptcy Rules provides
that an “order authorizing the trustee to assign an executory contract or unexpired lease . . . is
stayed until the expiration of the 14 days after the entry of the order, unless the court orders
otherwise.” The Debtors request that the Bid Procedures Order and the Sale Order be effective
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immediately by providing that the 14-day stays applicable under Rules 6004(h) and 6006(d) of
the Bankruptcy Rules be waived.
NOTICE
60. Notice of this Motion has been given to the following parties, or in lieu thereof, to
their counsel: (a) the parties identified on the Master Service List in these Bankruptcy Cases as
approved by this Court’s Order Establishing Notice and Administrative Procedures
[Docket No. 33], and (b) via electronic mail on all persons or entities known or reasonably
believed to have asserted an interest in purchasing the Acquired Assets. The Debtors will also
serve a Notice of Hearing on this Motion: (i) on the entire creditor matrix in each of the
Bankruptcy Cases and (ii) via electronic mail on all persons or entities known or reasonably
believed to have an interest in purchasing the Acquired Assets. In light of the nature of the relief
requested, the Debtors respectfully submit that no further notice is necessary.
NO PRIOR REQUEST
61. No prior motion for the relief requested in this Motion has been made to this
Court or any other court.
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WHEREFORE, the Debtors request that this Court: (i) enter the Bid Procedures Order,
(ii) approve the form of the Sale Notice and to the extent necessary shorten notice thereto,
(iii) approve the form of the Notice of Assumption and Assignment and to the extent necessary
shorten notice thereto, (iv) enter the Sale Order (if applicable), and (v) grant the Debtors such
other and further relief as the Court may deem just and appropriate.
Respectfully submitted this 10th day of September 2019.
ARNALL GOLDEN GREGORY LLP
/s/ Darryl S. Laddin

Darryl S. Laddin
Sean C. Kulka
171 17th Street, N.W., Suite 2100
Atlanta, Georgia 30363-1031
Phone: (404) 873-8500
Fax: (404) 873-8683
Email: darryl.laddin@agg.com
Email: sean.kulka@agg.com
Attorneys for Debtors and Debtors in Possession
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13889329v4

ATLANTA DIVISION
In re: ) Chapter 11
)
)
Debtors. ) (Joint Administration Requested)
)
DECLARATION OF NED LIDVALL,

CHIEF EXECUTIVE OFFICER OF THE DEBTORS,
IN SUPPORT OF CHAPTER 11 PETITIONS AND FIRST DAY ORDERS
Ned Lidvall makes this declaration pursuant to 28 U.S.C. § 1746, and states:
1. My name is Ned Lidvall and I am over 21 years of age. I am the Chief Executive
Officer of each of the above-captioned debtors and debtors in possession, Eat Here Brands, LLC,
Babalu Atlanta #1 LLC, Babalu Atlanta #2 LLC, Babalu Knoxville #1, LLC, Babalu Memphis
#1, LLC, Babalu Memphis #2 LLC, Babalu, LLC, and Babalu Birmingham #1, LLC
(collectively, the “Debtors”), and one of the Managers on the Board of Managers of Eat Here
Brands, LLC. On July 30, 2019 (the “Petition Date”), each of Debtors commenced the above-
captioned bankruptcy cases (the “Bankruptcy Cases”) under Chapter 11 of Title 11 of the United
States Code (the “Bankruptcy Code”).
2. Based on my first-hand knowledge of the Debtors and their operations as well as
information provided to me by representatives of the Debtors, I make this declaration in support
of the various first day pleadings as described in more detail below. I am one of the four
founders of Eat Here Brands, LLC, and served as Chief Executive Officer from 2012 through
1
The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s federal tax
(4558); Babalu, LLC (7673); and Babalu Birmingham #1 LLC (1892). The Debtors’ mailing address is 9755
1
2014. On May 15, 2019, I re-joined the Debtors as Chief Executive Officer in order to assist the
Debtors with their restructuring efforts.
A. The Debtors’ Corporate Formation and Assets
3. Eat Here Brands, LLC, is a Delaware limited liability company (“Eat Here”), and
was formed on or about May 23, 2012, by the filing of Articles of Organization with the
Delaware Secretary of State. Eat Here currently has 52 members and is Managed by its Board of
Managers consisting of William H. Latham, David A. Roberts, Ned Lidvall, Steven Rockwell,
and Ronald A. Rosati. Eat Here owns 100% of the membership interests of the other Debtors
(as well as certain other non-debtor entities) as well as the trademarks and other intellectual
property rights of the Babalu restaurant concept.
4. Babalu Atlanta #1 LLC is a Georgia limited liability company
(“Babalu Atlanta #1”), and was formed on or about June 28, 2016, by the filing of Articles of
Organization with the Georgia Secretary of State. Babalu Atlanta #1’s sole Member is Eat Here.
Babalu Atlanta #1’s Managers are William H. Latham and David A. Roberts. Babalu Atlanta #1
owns the restaurant assets located at the Debtors’ restaurant located at 33 Peachtree Place, N.E.,
Atlanta, Georgia 30309 (the “Atlanta Restaurant”).
5. Babalu Atlanta #2 LLC is a Georgia limited liability company
(“Babalu Atlanta #2”), and was formed on or about April 12, 2018, by the filing of Articles of
Organization with the Georgia Secretary of State. Babalu Atlanta #2’s sole Member is Eat Here.
Babalu Atlanta #2’s Managers are William H. Latham and David A. Roberts. Babalu Atlanta #2
owns the restaurant assets located at the Debtors’ developing restaurant located at Roswell
Square in Roswell, Georgia (the “Roswell Restaurant”).
2
6. Babalu Knoxville #1, LLC is a Tennessee limited liability company
(“Babalu Knoxville #1”), and was formed on or about January 23, 2015, by the filing of Articles
of Organization with the Tennessee Secretary of State. Babalu Knoxville #1’s sole Member is
Eat Here. Babalu Knoxville #1’s Sole Manager is William H. Latham. Babalu Knoxville #1
owns the restaurant assets located at the Debtors’ restaurant located at located at 412 S. Gay
Street, Knoxville, Tennessee 37902 (the “Knoxville Restaurant”).
7. Babalu Memphis #1, LLC is a Tennessee limited liability company
(“Babalu Memphis #1”), and was formed on August 11, 2013, by the filing of Articles of
Organization with the Tennessee Secretary of State. Babalu Memphis #1’s sole Member is
Eat Here. Babalu Memphis #1’s Managers are William H. Latham and Ned Lidvall. Babalu
Memphis #1 owns the restaurant assets located at the Debtors’ restaurant located at 2115
Madison Avenue, Memphis, Tennessee 38104 (the “Memphis East Restaurant”).
8. Babalu Memphis #2 LLC is a Tennessee limited liability company
(“Babalu Memphis #2”), and was formed on or about June 28, 2016, by the filing of Articles of
Organization with the Tennessee Secretary of State. Babalu Memphis #2’s sole Member is
Eat Here. Babalu Memphis #2’s Managers are William H. Latham and David A. Roberts.
Babalu Memphis #2 owns the restaurant assets located at the Debtors’ restaurant located at 6450
Poplar Avenue, Memphis, Tennessee 38119 (the “Memphis East Restaurant”).
9. Babalu, LLC, is a Mississippi limited liability company (“Babalu”), and was
formed on or about July 1, 2010, by the filing of Articles of Organization with the Mississippi
Secretary of State. The original Members of Babalu were William H. Latham and David A.
Roberts. On or about May 23, 2012, pursuant to that certain Contribution Agreement, Mr.
Latham and Mr. Roberts contributed their membership interests in Babalu to Eat Here for the
3
consideration stated in the Contribution Agreement. Accordingly, Babalu’s sole Member is
Eat Here. Babalu’s Managers are William H. Latham and David A. Roberts. Babalu owns the
restaurant assets located at the Debtors’ restaurant located at 622 Duling Avenue, Jackson,
Mississippi 39216 (the “Jackson Restaurant”).
10. Babalu Birmingham #1, LLC is an Alabama limited liability company
(“Babalu Birmingham #1”), and was formed on or about October 16, 2013, by the filing of
Articles of Organization with the Alabama Secretary of State. Babalu Birmingham #1’s sole
Member is Eat Here. Babalu Birmingham #1’s Managers are William H. Latham and Ned
Lidvall. Babalu Birmingham #1 owns the restaurant assets located at the Debtors’ restaurant
located at 2808 7th Avenue South, Birmingham, Alabama 35233
(the “Birmingham Restaurant”).
B. The Babalu Concept and Restaurant Openings.
11. The Babalu concept was created by two successful restaurateurs, William H.
Latham and David A. Roberts, who have owned or operated restaurants both in and outside of
Jackson, Mississippi, for more than 30 years. The Babalu concept was named after the signature
song of the television character Ricky Ricardo, who was played by Desi Arnaz in the television
comedy series I Love Lucy. The Babalu concept features upscale Latin-inspired cuisine born out
of the love and respect for food and for music genres such as the guaracha, cha-cha, and Latin
jazz, which is a major component of the Babalu concept (the restaurants commonly plays Cuban,
Spanish, and Latin music of all genres). In 2010, Mr. Latham and Mr. Roberts opened the first
Babalu restaurant, the Jackson Restaurant, in Jackson’s historic Fondren neighborhood in a
former elementary school.
4
12. In early 2012, Mr. Latham and Mr. Roberts formed Eat Here to function as the
Babalu concept’s restaurant holding company. At that time, Eat Here held an interest in the
Jackson Restaurant, a Five Guys franchise that owned and operated four Five Guys restaurants in
Mississippi, and two fine dining restaurants. Eat Here was initially financed through a capital
contribution in exchange for common equity by the four founders (including Mr. Latham and
Mr. Roberts) and the sale of preferred stock through a private placement offering memorandum.
In 2015, Eat Here sold the Five Guys franchise, and then sold the fine dining restaurants in 2017
and 2019 respectively, in order to focus on the development of the Babalu concept.
13. In 2014, Eat Here opened the Memphis Restaurant and later that year opened the
Birmingham Restaurant. In 2015, Babalu opened the Knoxville Restaurant in the historic JC
Penney building in downtown Knoxville. In July of 2016, Babalu opened a restaurant in the
historic Dilworth neighborhood in Charlotte, North Carolina (the “Charlotte Restaurant”).
In 2017, Babalu opened the Memphis East Restaurant, and then the Atlanta Restaurant in the
heart of Midtown Atlanta. Later in 2017, Babalu opened a location in Chapel Hill, North
Carolina (the “Chapel Hill Restaurant”) and then another in Lexington, Kentucky
(the “Lexington Restaurant”). In 2018, Babalu started, but has not yet completed, construction
on a second metro Atlanta location at Roswell Square, the Roswell Restaurant.
C. Origin Bank Loans to the Debtors
14. Pursuant to that certain Business Loan Agreement dated as of June 14, 2016,
between Eat Here and Origin Bank (the “Business Loan Agreement”), Origin Bank
(“Origin” or ”the “Prepetition Lender”) provided an asset-based loan to Eat Here in the
maximum principal amount of $3 million (the “Business Loan”), which Business Loan is
evidenced by that certain promissory note dated June 14, 2016, made by Eat Here in favor of
5
Origin in the original principal amount of $3 million (the “Business Note”), bearing loan number
5002668-10001.
15. Pursuant to that certain Loan Agreement dated as of March 27, 2017, between
Eat Here and Origin, as amended by that certain First Amendment to Loan Agreement dated
May 22, 2017 (as amended, modified, supplemented, or restated, the “Guidance Line Loan
Agreement”), Origin provided a guidance line of credit to Eat Here in the maximum principal
amount of $15 million (the “Loan”), which Loan is evidenced by, among other things: (i) that
certain Promissory Note dated March 27, 2017, bearing loan number 100136-10001 made by
Eat Here in favor of Origin in the original principal amount of $1 million; (ii) that certain
Promissory Note dated March 27, 2017, bearing loan number 100136-10002, made by Eat Here
in favor of Origin in the original principal amount of $1 million; (iii) that certain Promissory
Note dated March 27, 2017, bearing loan number 100136-10003, made by Eat Here in favor
Origin in the original principal amount of $1 million; (iv) that certain Promissory Note dated
July 7, 2017, bearing loan number 100136-10004, made by Eat Here in favor of Origin in the
original principal amount of $1 million; and (v) that certain Promissory Note dated September
18, 2018, bearing loan number 100136-10005, made by Eat Here in favor Origin in the original
principal amount of $1 million (collectively, the “Guidance Line Notes”).
16. Pursuant to that certain Second Amendment to Loan Agreement and Other
Documents dated as of July 16, 2019, between the Debtors and Origin (the “Bridge Loan
Agreement”; together with the Business Loan Agreement and the Guidance Line Loan
Agreement, as such agreements may have been amended or modified from time to time,
the “Loan Agreements”), Origin provided a bridge loan to the Debtors in the amount of $275,000
(the “Bridge Loan”), which Bridge Loan is evidenced by, among other things, that certain
6
Promissory Note dated July 16, 2019, made by the Debtors in favor of Origin (the “Bridge Loan
Note”; together with the Business Note and the Guidance Loan Notes, the “Notes”).
17. The Notes are secured by, among other things, (i) that certain Security Agreement
dated as of March 27, 2017, by and between Babalu and Origin, covering substantially all of
Babalu’s personal property located at the Jackson Restaurant (the “Jackson Collateral”); (ii) that
certain Security Agreement dated as of March 27, 2017, by and between Babalu Atlanta #1 and
Origin, covering substantially all of Babalu Atlanta #1’s personal property located at the Atlanta
Restaurant (the “Atlanta Collateral”); (iii) that certain Security Agreement dated as of September
18, 2018, by and between Babalu Atlanta #2 and Origin, covering substantially all of Babalu
Atlanta #2’s personal property located at the Roswell Restaurant (the “Roswell Collateral”);
(iv) that certain Security Agreement dated as of March 27, 2017, by and between Babalu
Memphis #1 and Origin, covering substantially all of Babalu Memphis #1’s personal property
located at the Memphis Restaurant (the “Memphis Collateral”); (v) that certain Security
Agreement dated as of March 27, 2017, by and between Babalu Memphis #2 and Origin,
covering substantially all of Babalu Memphis #2’s personal property located at the
Memphis East Restaurant (the “Memphis East Collateral”); (vi) that certain Security Agreement
dated March 27, 2017, by and between Babalu Knoxville and Origin, covering substantially all
of Babalu Knoxville’s personal property located at the Knoxville Restaurant (the “Knoxville
Collateral”); and (vii) that certain Security Agreement dated March 27, 2017, by and between
Babalu Birmingham and Origin, covering substantially all of Babalu Birmingham’s personal
property located at Birmingham Restaurant (the “Birmingham Collateral”; together with the
Jackson Collateral, the Atlanta Collateral, the Roswell Collateral, the Memphis Collateral, the
Memphis East Collateral, and the Knoxville Collateral, the “Location Collateral”)
7
(collectively, each of the Security Agreements identified in this paragraph, together with the
Borrower Security Agreement (as defined below) are hereinafter, the “Security Agreements”;
together with the Loan Agreements, the Notes, and any related loan documents executed
substantially contemporaneously therewith, the “Loan Documents”).
18. The Notes are also secured by Origin’s security interest in substantially all assets
of Eat Here pursuant to the Loan Agreements and (i) that certain Commercial Security
Agreement dated June 14, 2016, by and between Eat Here and Origin, and (ii) that certain
Security Agreement dated March 27, 2017, by and between Eat Here and Origin (collectively,
the “Borrower Security Agreement”), covering substantially all of Eat Here’s personal property
(the “Eat Here Collateral”). Pursuant to the Loan Agreements and the Security Agreements,
the Debtors granted to Origin a security interest in and continuing lien on substantially all of the
Debtors’ assets and the proceeds thereof (the “Pre-Petition Lender’s Liens”). Origin’s security
interest in the Eat Here Collateral and the Location Collateral is evidenced by recorded financing
statements, recorded in Delaware, Georgia, Tennessee, Alabama, and Mississippi
(collectively, the “UCC-1s”). As of the Petition Date, the outstanding balance under the Notes
was approximately of $5.882 million.
D. The Babalu Notes
19. In May of 2015, Eat Here issued $3 million in unsecured notes
(the “Babalu Notes”) through a private placement to 35 investors. All but two of the holders of
the Babalu Notes were already members of Eat Here. The Babalu Notes mature in May of 2020.
As of the Petition Date, the outstanding balance on the Babalu Notes was
approximately $1.6 million.
8
E. Trade Creditors
20. In addition to the Debtors’ secured obligations to Origin and Eat Here’s unsecured
obligations to the holders of the Babalu Notes, the Debtors owe approximately $1.4 million to
unsecured trade creditors.
F. Events Leading to Chapter 11 Filings
21. Through year end 2016, in addition to the Jackson Restaurant, Eat Here had
opened four new Babalu branded restaurants: Memphis, Birmingham, Knoxville, and Charlotte
Restaurants. However, in 2016 Eat Here signed multiple leases for new Babalu restaurants, and
in 2017 opened four new restaurants (East Memphis, Atlanta, Chapel Hill, and Lexington
Restaurants), with the last three of those restaurants opening within a four month time-period.
This rapid growth strained Eat Here’s resources and led to increased turnover and inconsistent
operations. As a result, initially strong sales at two of the four new restaurants (the Atlanta and
Lexington Restaurants) declined significantly in the months after opening.
22. In addition to operating difficulties, a failed effort to sell Eat Here diverted senior
management’s attention away from restaurant operations. Further, compounding the weakness
in sales at several of the new restaurants was the fact that development costs at each location
significantly exceeded budget, which were at least partially financed by the Debtors’ rapidly
amortizing Origin loans. Cash flow from the Atlanta, Chapel Hill, and Lexington Restaurants
was significantly below budget, and those locations operated at negative cash flow levels for
much of their operating history. In addition, high levels of employee turnover in the new
restaurants forced Eat Here to pull staff away from existing restaurants, which further
contributed to declining sales and cash flow at those locations.
9
23. In early 2018,2 management elected to halt new unit development in response to
the disappointing results at the new restaurants and declining sales at the more established
locations. However, by that time Eat Here and certain newly formed affiliates had already
signed three additional leases in Nashville, Columbus, and a second location in Charlotte.
Efforts to sub-lease those properties proved to be unsuccessful, and Eat Here incurred significant
rent expense without any offsetting revenue. In addition, due to weak revenue, in the Fall of
2018, Eat Here was forced to close the Charlotte Restaurant. Moreover, the Debtors’ Chief
Financial Officer, Tim Walker, resigned on December 7, 2018.
24. Struggling under declining sales and cash flow, lease payments for dark
restaurants and undeveloped locations, and significant debt service obligations, Eat Here
implemented several strategic initiatives in an effort to build sales and reduce operating costs,
including a substantial reduction in corporate overhead. While those measures were initially
successful in improving sales and profitability at several restaurants in early 2019, the rapid pace
of change from several of the strategic initiatives confused customers and sales weakened
beginning in the spring of 2019, which further reduced cash flow. Shortly thereafter, Eat Here
was forced to close the Chapel Hill and Lexington Restaurants. Moreover, the Debtors’
corporate Controller, Candice, Luther, has resigned effective August 1, 2019. Ultimately, the
strain of rent expense at locations with no operating revenue, the loss of portions of their senior
management team, significant debt service obligations, and declining cash flow at existing
2
Although management had decided to curtail expansion in 2018, it became aware of a location near its
corporate headquarters in Roswell, Georgia that had many of the characteristics of Eat Here’s earlier successful
restaurants - it was in a redeveloped area and a historic building. Further, rent was very attractive at this location
and the budgeted investment was relatively low. Consequently, senior management decided to develop the Roswell
Restaurant, and as of the Petition Date, approximately half of the construction costs for this location has been
funded. However, due to the Debtors’ current liquidity issues, construction at the Roswell Restaurant has been
suspended.
10
restaurants caused the Debtors to file these Bankruptcy Cases and seek the protection of this
Court under Chapter 11 of the Bankruptcy Code.
Filing of Bankruptcy Cases and First Day Motions
25. On the Petition Date, the Debtors each filed with this Court their voluntary
petitions for relief under Chapter 11 of the Bankruptcy Code. In connection with the Debtors’
Chapter 11 bankruptcy cases, the Debtors have filed or will file the following applications and
motions (collectively, the “First Day Motions”), among others (the “Other Applications”):
1. Application for an Order Directing Joint Administration of Cases Pursuant to Bankruptcy

Rule 1015 (“Application for Joint Administration”)
2. Debtors’ Emergency Motion for an Order to Extend Time to File Schedules and Statements
of Financial Affairs (“Schedules Motions”)
3. Debtors’ Emergency Motion for an Order Establishing Notice and Administrative

Procedures (“Notice Procedures Motion”)
4. Debtors’ Emergency Motion to Authorize Payment of Pre-Petition Wages, Payroll Taxes,

Certain Employee Benefits, and Related Expenses, and Other Compensation to Employees
(“Employee Wage Motion”)
5. Debtors’ Emergency Motion for Authority to Continue Pre-Existing Insurance Programs,

and to Pay Pre-Petition Premiums and Related Obligations (“Insurance Motion”)
6. Debtors’ Emergency Motion for Authority to (A) Maintain Existing Bank Accounts, and
(B) Continue Use of Existing Business Forms (“Cash Management Motion”)
7. Debtor’s Emergency Motion For Interim and Final Orders (A) Prohibiting Utilities from
Altering, Refusing, or Discontinuing Service on Account of Prepetition Invoices, (B)
Deeming Utilities Adequately Assured of Future Performance, and (C) Establishing
Procedures for Determining Adequate Assurance of Payment (“Utility Motion”)
11
8. Debtor’s Emergency Motion Pursuant to 11 U.S.C. §§ 105, 361, 362, 363, 364 and 507 for
Interim and Final Orders (A) Authorizing: (1) The Debtors to Obtain Post-Petition
Financing; and (2) Use of Cash Collateral; (B) Granting Liens and Providing Superpriority
Administrative Expense Status; (C) Granting Adequate Protection; (D) Modifying
Automatic Stay; (E) Scheduling a Final Hearing; and (F) Granting Related Relief
(“DIP Motion”)
9. Debtors’ Emergency Motion for an Order Authorizing the Debtors to Pay Pre-Petition Sales,
and Other Taxes and Related Obligations (“Sales Tax Motion”)
10. Application for an Order Appointing Omni Management Group as Claims, Noticing, and
Administrative Agent for the Debtors Pursuant to 28 U.S.C. §156(c) and 11 U.S.C. § 105(a),
Nunc Pro Tunc to the Petition Date (“Omni Application”)
11. Debtors’ Application Pursuant to Section 327(a) of the Bankruptcy Code and Bankruptcy
Rule 2014 for an order Authorizing the Retention and Employment of Schulten Ward Turner
& Weiss LLP as Conflicts Counsel for the Debtors Nunc Pro Tunc to the Petition
(“Schulten Application”)
12. Debtors’ Application Pursuant to Section 321(a) of the Bankruptcy Code and Bankruptcy
Rule 2014 for an Order Authorizing the Retention and Employment of GGG Partners, LLC
as Financial Advisor for Debtors Nunc Pro Tunc to the Petition Date (“GGG Application”)
13. Application Pursuant to Section 327(a) of the Bankruptcy Code and Bankruptcy Rule 2014
for an Order Authorizing the Retention and Employment of Arnall Golden Gregory LLP as
Attorneys for Debtors Nunc Pro Tunc to the Petition Date (“AGG Application”)
1. Application for Joint Administration
26. As set forth above, Eat Here Brands, LLC currently has 75 equity security holders
and is Managed by its Board of Managers. Eat Here Brands, LLC owns 100% of the
membership interests of Babalu Atlanta #1 LLC, Babalu Atlanta #2 LLC, Babalu Knoxville #1
LLC, Babalu Memphis #1 LLC, Babalu Memphis #2 LLC, Babalu, LLC, and Babalu
Birmingham #1 LLC. The Debtors anticipate that numerous notices, applications, motions, other
pleadings, hearings, and orders in these Bankruptcy Cases will affect many or all of the Debtors.
12
2. Schedules Motion
27. The Debtors’ Chief Financial Officer, Tim Walker, resigned on
December 7, 2018. Moreover, the Debtors corporate Controller, Candice, Luther, has resigned
effective August 1, 2019. To prepare the Schedules, the Debtors must gather information from
books, records, and documents relating to a multitude of transactions. Consequently, collection
of the necessary information requires the expenditure of substantial time and effort on the part of
the Debtors; limited and already over-burdened employees. The Debtors submit that the efforts
of their employees during the initial stages of these Bankruptcy Cases are critical and need to be
focused on attending to the Debtors’ businesses and maximizing the value of the Debtors’
bankruptcy estates.
3. Notice Procedures Motion
28. Currently, there are over 500 creditors (excluding employees) and parties-in-
interest may be technically entitled to receive notice in these Bankruptcy Cases. To require the
Debtors to provide notice of all pleadings and other papers filed in these Bankruptcy Cases to
these parties-in-interest would be extremely burdensome and costly to the Debtors’ bankruptcy
estates as a result of photocopying and postage expenses as well as other expenses associated
with such large mailings.
4. Employee Wage Motion
29. The Debtors employ approximately 567 people (the “Employees”), of which 36
are employed on a full-time, salaried basis (“Salaried Employees”) and 531 are hourly
employees (“Hourly Employees”). Approximately 122 Hourly Employees were full-time
equivalent employees (“Hourly FTE Employees”) as of the last open-enrollment period in
13
November 2018, meaning that, as of the open enrollment period, the Hourly Employee averaged
30 hours per week for the prior six months.
30. The Debtors utilize independent contractors from time to time (collectively,
the “Independent Contractors”). Currently, the Debtors utilizes a single independent contractor
for marketing and graphic-design services. The Independent Contractors receive 1099 forms for
tax purposes, and, accordingly, do not represent a payroll tax burden to the Debtors and are not
entitled to any of the employee benefits discussed in the Employee Wage Motion.
31. The Debtors are seeking authority to pay the wages, additional compensation, and
benefits more fully described below (the “Employee Obligations”) that become payable during
the pendency of these Bankruptcy Cases and to continue at this time its practices, programs, and
policies with respect to their Employees and Independent Contractors, as such practices,
programs, and policies were in effect as of the Petition Date. Even though the Debtors have
incurred certain Employee Obligations prior to the Petition Date, certain of the Employee
Obligations will become due and payable in the ordinary course of the Debtors’ business on and
after the Petition Date. The Employee Obligations include, without limitation: (i) wages, salary,
and other compensation; (ii) payroll taxes; (iii) vacation programs; (iv) expense reimbursement;
(v) auto allowance; and (vi) health and welfare benefits. The Employee Obligations are more
specifically described as follows:
 Wages, salaries, and other compensation. These obligations consist of wages,

salaries, and commissions owed to the Employees (the “Payroll Obligations”).
The Debtors pay their Employees bi-weekly, in arrears. The average Payroll
Obligation is approximately $295,000. In addition to wages paid through payroll,
certain Hourly Employees (bartenders, servers, and servers’ assistants) receive
tips or tipshares in cash at the end of each daily shift (“Tips”), and two of the
Debtors’ Salaried Employees are catering managers and receive commissions in
addition to their salaries. Those commissions are based on catering and banquet
14
sales for the preceding four-week fiscal period.3 Mobile-phone and parking
reimbursement, discussed below, are also included in Payroll Obligations. The
gross amount of Payroll Obligations includes certain deductions described
separately below, such as payroll taxes owed by the Employees and/or the
Employer. Additionally, though already paid, Tips are included along with the
Payroll Obligations for the purposes of determining payroll taxes, as discussed
below. As a general rule, Payroll Obligations are deposited directly into the
Employees’ bank accounts, though exceptions are made, in which case payment
will be made by paper check.4 As of the Petition Date, the Debtors owe
approximately $307,000 on account of Payroll Obligations.5
 Independent Contractors. These obligations consist of amounts owed as

compensation to the Independent Contractors. The amount paid by the Debtors to
Independent Contractors for marketing services is $4,000 per four-week fiscal
period. As of the Petition Date, the Debtors owe approximately $0.00 on account
of obligations to the Independent Contractors.
 Payroll taxes. These obligations consist of federal, state, and local income taxes,
social security, and Medicare taxes. The payroll taxes include the amounts owed
by Employees that are withheld from the gross amount of the Employees’ wages
or salary as well as the amounts separately owed by the Debtors. Payroll taxes are
withheld from Employee paychecks and remitted along with the net pay and
employer taxes to the payroll company, Paycor, one business day prior to the pay
date. Paycor either directly deposits or remits a paper check for net pay and
remits all taxes to the respective taxing authorities. In the year preceding the
Petition Date, the Debtors’ average payroll tax liability for Employees ranged
from approximately $92,629.49 to $138.190.28 per fiscal period consisting of
approximately $29,763.66 to $44,078.73 for the Employer obligation and
approximately $62,865.83 to $94,111.55 for Employee obligations, which is
included in the gross amount of the Payroll Obligations discussed above. As of
the Petition Date, the Debtors owe approximately $96,500 on account of
outstanding pre-petition payroll taxes.
 Unemployment taxes. The Debtors also pay certain state and federal
unemployment taxes computed as a percentage of the first $7,000 of an
Employee’s gross wages for federal unemployment taxes and between $7,000 to
14,000 of an Employee’s gross wages (varying by state) for state unemployment
3
The Debtors operate on 13 fiscal periods. Each fiscal period comprises two two-week
pay periods.
4
Approximately 93% of Employees are enrolled in direct deposit.
5
I have deferred all of my $2,500 weekly compensation for serving as CEO of the Debtors
since my retention and, as of the Petition Date, I am owed approximately $27,000. Through the
Employee Wage Motion, the Debtors are seeking authority to pay me $12,850 (the amount of the
priority cap) for my back compensation.
15
taxes. Paycor also collects unemployment taxes each pay period and remits the
taxes to the respective tax authorities. The Debtors’ unemployment tax liability
for June 2019 was $6,197.86. As of the Petition Date, the Debtors owe
approximately $2,500 on account of outstanding pre-petition
unemployment taxes.
 Vacation and holiday programs. These obligations consist of time off for vacation
and company holidays. Eat Here Brands, LLC recognizes seven holidays per year.
The other Debtors recognize two (Christmas day and Thanksgiving day). In
addition, full-time salaried employees receive two-weeks’ paid time off, and
Hourly FTE Employee with one-year continuous employment averaging 35 hours
per week for the six months prior to the their anniversary date are eligible for one-
week of paid vacation, with pay calculated at the average of hours worked in the
preceding six-month period.
 Expense Reimbursements. The Debtors reimburse Employees for expenditure of

personal funds on work-related expenses and for mileage in personal vehicles on
work-related trips at the IRS rates approved for reimbursement of travel offsite by
employees. Additionally, Debtors provide certain Salaried Employees a mobile-
phone reimbursement of $75 per pay period and Salaried Employees at Babalu
Knoxville #1 LLC receive a parking reimbursement of $40 per period. As of the
Petition Date, the Debtors owe approximately $2,500 to various Employees and
former Employees on account of reimbursable expenses.
 Auto Allowance. In lieu of mileage reimbursement, the Debtors’ Marketing

Director, IT Manager, Executive Chef, Operations and Training Administrator,
and two Regional Operations Administrators receive an auto-allowance, which
ranges from $100 to $350 per pay period, and totals $1,250 per pay period.
 Health and welfare benefits. The Debtors provide certain Employees with health,
dental, and vision insurance.
o Health Insurance. For Salaried Employees and qualified Hourly FTE

Employees, the Debtors provide health-insurance plans that are
administered by United Healthcare. Currently, there are 47 -participants
in this program. For Hourly FTE Employees, the Debtors pay in-
advance premiums ranging from $321.13 to $674.37 per month
depending on the plan elected, which the Hourly FTE Employees
partially reimburse, ranging from $48.76 to $198.37 per Hourly FTE
Employee per pay period depending on the plan elected and the Hourly
FTE Employee’s hourly wage. For Salaried Employees, the Debtors pay
in-advance premiums ranging from $418.60 to $1,213.94 per month
depending on the plan elected, which the Salaried Employees partially
reimburse, ranging from $38.64 to $251.57 per Salaried Employee per
pay period depending on the plan elected. Total reimbursements for
Hourly FTE and Salary Employees total $5,297.39 per pay period
16
o Dental Insurance. The Debtors provide Salaried Employees a dental-

insurance plan administered by United Healthcare. Currently, there are
27 Salaried Employees participating in this program. The Debtors pay
in-advance the monthly premiums ranging from $13.40 to $42.81 per
Salaried Employees per pay period depending on the plan elected, which
the Salaried Employees totally reimburse through payroll deductions.
o Vision Insurance. The Debtors provide Salaried Employees a vision-

insurance plan administered by United Healthcare. Currently, there are
25 Salaried Employees participating in this program. The Debtors pay in
advance the monthly premiums ranging from $4.01 to $11.41 per
Salaried Employees per pay period depending on the plan elected, which
the Salaried Employees totally reimburse through payroll deductions.
o Combined Premium. The Debtors pay a United Healthcare a combined

premium of $31,016.04 for Health, Dental, and Vision Insurance, of
which the Debtors subsidize $15,544 for Health Insurance premiums, as
discussed above. The next combined premium payment comes due on
August 1, 2019.
32. Any delay in paying Employee Obligations will adversely impact the Debtors’
relationships with their Employees and will irreparably impair the morale, dedication,
confidence, and cooperation of the very people upon whom the Debtors rely in order for their
businesses to be successful. The Debtors must have the support of their Employees in order for
the Debtors’ efforts in these Bankruptcy Cases to succeed. If the relief requested by the
Employee Wage Motion is not granted, the Debtors will likely be out of business altogether.
33. If the Employee Wage Motion is not granted the Debtors’ Employees will suffer
undue hardship and, in many instances, serious financial difficulties, as the amounts in question
are needed to enable certain of the Employees to meet their own personal financial obligations.
The stability of the Debtors will thus be undermined, perhaps irreparably, by the possibility that
otherwise loyal Employees will seek other employment alternatives.
5. Insurance Motion
34. In connection with the operation of their businesses, the Debtors maintain various
insurance policies and programs through several different insurance carriers (the “Insurance
17
Carriers”). All insurance policies (except for policies where the entire premium is paid in
advance) covering the Debtors are listed on Exhibit A to the Insurance Motion, together with a
list of the Insurance Carriers, policy terms, and the premiums due thereunder.
35. The insurance policies and programs covering the Debtors include liability and
property insurance policies, which provide the Debtors with insurance coverage relating to,
among other things, D&O Insurance, General liability, Umbrella, Commercial Property, Crime,
& Auto, and Workers Compensation.
36. As of the Petition Date, the Debtors believe that they are current on their
insurance premiums with respect to the prepetition period. However, to the extent there is an
outstanding insurance policy premium payable by the Debtors that relates (in whole or in part) to
the pre-petition period, the Debtors seek authority to pay these pre-petition premiums in the
ordinary course of business as such payments are necessary to keep their insurance policies and
programs in force.
37. Under the laws of the States where the Debtors operate, including Alabama,
Georgia, Mississippi, and Tennessee, the Debtors are required to maintain workers’
compensation policies and programs to provide their employees with coverage for claims arising
from or related to their employment with the Debtors. Worker’s compensation coverage for the
Debtors employees is covered by a workers compensation insurance policy with Eastern Alliance
Insurance Group and Eat Here (the “Workers’ Compensation Program”). Eat Here’s policy with
Eastern Alliance Insurance Group covers claims for bodily injury of up to $1 million per
accident and claims for disease up to $1 million for each employee. Employees submit claims
directly to Eastern Alliance Insurance Group. Debtors’ premium for this policy is $85,716
approximately $150 per employee per year—which covers a period from November 2018 to
18
November 2019. The Debtors paid 25% of the premium up front and pay monthly premiums in
advance in the amount of $7,143.
38. To the best of my knowledge, as of the Petition Date, there were not any claims
pending against the Debtors under the Workers’ Compensation Program. Accordingly, to the
best of my knowledge, the Debtors are not aware of any deductibles or other amounts owed on
account of the Workers’ Compensation Program.
6. Cash Management Motion
39. The Debtors maintain nine (9) bank accounts (collectively, the “Accounts”) at
Origin Bank (the “Bank”), including: (1) an operating account in the name of Babalu (ending in
5502), (2) an operating account in the name of Babalu Memphis #1 (ending in 3913), (3) an
operating account in the name of Babalu Birmingham #1 (ending in 3925), (4) an operating
account in the name of Babalu Knoxville #1 (ending in 4601), (5) an operating account in the
name of Babalu Atlanta #1, (ending in 9805), (6) an operating account in the name of Babalu
Memphis #2 (ending in 8171), (7) an operating account in the name of Eat Here (ending in 7286)
(collectively, the “Operating Accounts”), (7) a money market account in the name of Eat Here
(ending in 7756) (the “Savings Account”),6 and (9) a payroll account in the name of Eat Here
(ending in 7215) (the “Payroll Account”). Cash revenues7 from each of the restaurant operating
Debtors are deposited into that respective Debtor’s Operating Account. Checks and ACH
payments for alcohol, sales taxes, and vendors are drawn from the Operating Account of each
respective restaurant operating Debtor. At the end of each evening any funds remaining in the
6
Eat Here uses this Account as a savings account. Eat Here does not write checks off of this account, but
occasionally initiates wire transfers from this Account into its Operating Account. This Account currently has a
balance of approximately $3,000.
7
Cash generated from restaurant operations is moved from the Debtors’ restaurants to the Bank through
Loomis (an armored car service). Further, Loomis delivers petty cash to the restaurant operating Debtors based on
their day-to-day cash needs.
19
Operating Accounts of the restaurant operating Debtors are swept into Eat Here’s Operating
Account. Any shortfalls in the Operating Accounts of the restaurant operating Debtors are
funded out of Eat Here’s Operating Account. The Debtors used to fund their respective payrolls
through the Payroll Account, which was funded through Eat Here’s Operating Account. The
Debtors currently fund payroll through Paycor (third party payroll processor), which is funded
out of Eat Here’s Operating Account. The Debtors respectfully request that they be permitted to
maintain the Accounts to avoid any disruption or delay in making and receiving payments.
40. Furthermore, by virtue of the nature and scope of the Debtors’ businesses, and
their employees, suppliers of goods and services, and others with whom the Debtors transact
business, it is important that the Debtors be permitted to continue to use their existing business
forms, including checks. A substantial amount of time and expense would be required to print
new business forms and stationery and being required to obtain new business forms would also
likely result in a substantial risk of disruption to the Debtors’ ordinary business affairs.
7. Utility Motion
41. Utility services are essential to the Debtors’ ability to sustain their operations
while these chapter 11 cases are pending. In the normal conduct of their businesses, the Debtors
have direct relationships with approximately four utility companies (collectively, the “Utility
Companies”) for the provision of electric, water, sewage & garbage, cable, telephone, internet,
and other services (the “Utility Services”). A list identifying the Utility Companies and their
notice addresses is attached to the Utility Motion as Exhibit A (the “Utilities Service List”).
To the best of my knowledge the information contained in Exhibit A of the Utility Motion
is accurate.
20
42. At all relevant times, the Debtors have attempted to remain current with regard to
their utility bills. Furthermore, to the best of the Debtors’ knowledge, the Debtors are current on
all amounts owing to the Utility Companies, other than payment interruptions that may be caused
by the commencement of these chapter 11 cases.
43. Continued and uninterrupted Utility Service is vital to the Debtors’ ability to
sustain their operations during these chapter 11 cases. Because of the nature of the Debtors’
operations, termination or interruption of the Debtors’ utility service would dramatically impair
the Debtors’ ability to conduct business and would cause considerable inconvenience to the
Debtors’ customers and employees. If utility providers are permitted to terminate or disrupt
service to the Debtors, the Debtors’ primary revenue source would be threatened.
8. DIP Motion
44. As of the Petition Date, the Debtors, and certain other non-debtor affiliates owed
Origin approximately $5.882 million, secured by the Pre-Petition Collateral and all or
substantially all of the assets of the non-debtor entities. Approximately $275,000 of the
outstanding amount was the Bridge Loan, which was extended by Origin on an emergency basis
to fund the Debtors’ immediate operating needs prior to filing these Bankruptcy Cases,
including professional fees.
45. The applicable Debtors are currently in default under the provisions of the Pre-
Petition Loan Documents. The Debtors will be unable to operate their businesses in Chapter 11
without access to Origin’s Cash Collateral and access to the proposed DIP Facility. Given the
Debtors’ remaining assets and their capital and debt structure, the Debtors have been unable to
identify an alternative source of funding other than Origin.
21
46. Without adequate post-petition financing, the Debtors will not have sufficient
available sources of working capital to operate their businesses in the ordinary course for a
period of time sufficient to maximize the value of their assets for the benefit of all stakeholders.
The uncertainty concerning the Debtors’ financial condition has curtailed the Debtors’
availability of credit and acceptable credit terms. More specifically, the Debtors’ ability to
finance their operations and administer these Bankruptcy Cases is dependent on their ability to
obtain the funds made available under the DIP Facility and to use the Cash Collateral of Origin.
47. The inability of the Debtors to obtain sufficient liquidity and to make payments
on certain obligations on a timely basis may result in, inter alia, the Debtors’ inability to
continue the operation of their businesses and to pursue a restructuring. If any of these events
were to occur, the impact on the Debtors’ bankruptcy estates could be catastrophic and would
result in material harm to all of the Debtors’ creditors, investors, employees, and other
constituents. In light of the foregoing, the Debtors have determined, in the exercise of their
sound business judgment, that a post-petition credit facility, which permits the Debtors to obtain
up to $1.205 million in financing (which includes the Bridge Loan), and to use such credit to
finance the operation of their businesses as they attempt to reorganize, is critical to their ongoing
operations and stability during their bankruptcy process.
48. The Debtors believe that the debtor in possession financing offered by Origin
presents the best option available to them and would enable the Debtors to preserve their value as
a going concern. The Debtors have engaged in good-faith and extensive, arm’s-length
negotiations with Origin. These negotiations culminated in an agreement by Origin to provide
post-petition financing on the terms and subject to the conditions set forth in the DIP Loan
Agreement and the interim order substantially in the form attached to the DIP Motion as
22
Exhibit B (the “Interim Order”), including the condition that the Bridge Loan be rolled into and
made a part of the DIP Facility.
49. The credit provided under the DIP Facility will enable the Debtors to finance their
business operations, including the ability to operate their businesses in an orderly and reasonable
manner to preserve and enhance the value of their assets and enterprise for the benefit of all
creditors and parties in interest. It is expected that the availability of credit under the
DIP Facility will provide the Debtors with the necessary liquidity to continue their ordinary
course business operations in order to maximize the return available to the Debtors’ creditors in
these Bankruptcy Cases. Finally, I believe that the implementation of the DIP Facility will be
viewed favorably by the Debtors’ employees, vendors, and customers and thereby permit the
Debtors to continue to operate their businesses during the bankruptcy process.
50. Given the Debtors’ remaining assets and their capital and debt structure,
the Debtors are unable to obtain unsecured credit or debt allowable as an administrative expense
in an amount sufficient and readily available to maintain ongoing operations; nor have the
Debtors been able to obtain post-petition financing from an alternative prospective lender on
more favorable terms and conditions than the DIP Facility.
51. The Debtors have been looking for an alternative source of funding to the Pre-
Petition Lender since at least the first quarter of 2019, and have been unable to find alternative or
better financing on the terms and of the type and magnitude required in these Bankruptcy Cases
on an unsecured basis, or without offering terms substantially similar to or worse than those
under the DIP Facility. I believe that the terms and conditions of the DIP Facility are fair and
reasonable, and were negotiated by the parties in good faith and at arm’s length. Based on this,
23
as well as the foregoing factors, I believe that the DIP Facility is the only feasible financing
option for the Debtors and is in the best interests of the Debtors’ respective bankruptcy estates.
52. As described above, after appropriate investigation and analysis and given the
exigencies of the circumstances, the Debtors’ management has concluded that the DIP Facility is
the only alternative available in the circumstances of these Bankruptcy Cases.
53. As with most other large businesses, the Debtors have significant cash needs.
Accordingly, access to substantial credit is necessary to meet the day-to-day costs associated
with financing the operation of the Debtors’ businesses. In the absence of access to cash and
credit, the Debtors may be unable to operate their businesses or to complete the bankruptcy
process. In turn, without the DIP Facility, the Debtors’ prospects for a successful reorganization
will be impractical and the Debtors’ creditors, estates, and other parties in interest will be
materially harmed.
54. Given the Debtors’ constrained liquidity, the DIP Facility is of critical importance
to operating the Debtors’ businesses and preserving the value of the Debtors’ assets, thereby
providing a greater recovery to the Debtors’ creditors than would be realized if the Debtors were
forced to convert their Bankruptcy Cases to chapter 7 cases – which would invariably result in
the closure of the Debtors’ operating businesses and the Pre-Petition Lender exercising its rights
and remedies under applicable non-bankruptcy law. Accordingly, the Debtors submit that the
availability of post-petition credit under the DIP Facility is necessary to preserve and enhance the
value of their bankruptcy estates for the benefit of all stakeholders in these Bankruptcy Cases.
55. The Debtors are also seeking to use Cash Collateral of Origin immediately after
the entry of the Interim Order. The Debtors will use Cash Collateral to the extent necessary to
24
meet their working capital needs and only as set forth in the budget, which is attached to the DIP
Motion as Exhibit C (the “Budget”).
9. Sales Tax Motion
56. The Debtors are seeking authority to pay undisputed pre-petition sales taxes, use,
and other obligations (the “Taxes”) owed to the state and local taxing authorities listed on the
attached Exhibit A of the Sales Tax Motion (collectively, the “Taxing Authorities”) in the
ordinary course of business.
57. In connection with the normal operation of their businesses, the Debtors collect,
among other things, sales and use taxes from their customers and other third parties for
remittance to the Taxing Authorities. As reflected in Exhibit A to the Sales Tax motion, the
Debtors estimate that, as of the Petition Date, they hold approximately $169,000 in collected but
unremitted sales taxes, accrued state use taxes, and accrued state and local liquor use taxes.
58. The Debtors believe that they have sufficient cash reserves and will have
sufficient cash from ongoing operations and the proposed debtor-in-possession credit facility to
pay the amounts described in the Sales Tax Motion in the ordinary course of business.
10. Omni Application
59. I believe that retaining Omni Management Group, Inc. (“Omni”) as the Debtors’
claims and noticing agent is essential to the Debtors’ smooth transition into bankruptcy and the
successful reorganization of the Debtors. The Debtors anticipate that there will be well over 500
creditors and parties in interest in these Bankruptcy Cases. I believe that the number of
anticipated creditors and parties in interest will make it impracticable for the Debtors to serve the
required notices and other papers as part of the required bankruptcy administration in these
Bankruptcy Cases.
25
11. Schulten Application
I believe that retaining Schulten Ward Turner & Weiss, LLP (“SWTW”) as the Debtors’
conflicts counsel is essential to the Debtors’ smooth transition into bankruptcy and the successful
reorganization of the Debtors. To the best of the Debtors’ knowledge, and based on the
Declaration of Robert Mercer attached to the Schulten Application as Exhibit A
(the “Mercer Declaration”), the Debtors understand that SWTW does not hold or represent an
interest adverse to the Debtors or their estates. To the best of the Debtors’ knowledge,
understanding and belief, and based on the Mercer Declaration, the Debtors understand that
SWTW is a disinterested person, and their appointment will be in the best interests of the
Debtors’ estates, creditors, and other parties in interest.
12. GGG Application
I believe that retaining GGG Partners, LLC (“GGG”) as the Debtors’ financial advisor is
essential to the Debtors’ smooth transition into bankruptcy and the successful reorganization of
the Debtors. To the best of the Debtors’ knowledge, and based on the Declaration of Curt
Freiberg attached to the GGG Application as Exhibit A (the “Friedberg Declaration”), the
Debtors understand that GGG does not hold or represent an interest adverse to the Debtors or
their estates. To the best of the Debtors’ knowledge, understanding and belief, and based on the
Friedberg Declaration, the Debtors understand that GGG is a disinterested person, and their
appointment will be in the best interests of the Debtors’ estates, creditors, and other parties
in interest.
13. AGG Application
60. I believe that retaining Arnall Golden Gregory LLP (“AGG”) as the Debtors’
bankruptcy counsel is essential to the Debtors’ smooth transition into bankruptcy and the
26
successful reorganization of the Debtors. To the best of the Debtors’ knowledge, understanding
and belief, and based on the Affidavit of Darryl S. Laddin attached to the AGG Application as
Exhibit A (the “Laddin Affidavit”), the Debtors understand that AGG does not hold or represent
any disqualifying interest adverse to the Debtors or their bankruptcy estates. To the best of the
Debtors’ knowledge, understanding and belief, and based on the Laddin Affidavit, the Debtors
understand that AGG is a disinterested person, and their appointment will be in the best interests
of the Debtors’ estates, creditors, and other parties in interest.
61. I have reviewed each of the First Day Motions and Other Applications and, to the
best of my knowledge, believe the facts set forth therein are true and correct. Such
representation is based upon information and belief, through my review of various materials and
other information, and my experience and knowledge of the Debtors’ operations and financial
condition. If called upon to testify, I could and would, based on the foregoing, testify
competently to the facts set forth in each of the First Day Motions and Other Applications.
62. As a result of my first-hand experience, and through my review of various
materials and other information, discussions with the Debtors’ other executives, and discussions
with the Debtors’ professionals, I have formed opinions as to (a) the necessity of obtaining the
relief sought in the First Day Motions and Other Applications; (b) the importance of the relief
sought in the First Day Motions and Other Applications for the Debtors to continue to operate
effectively; and (c) the negative impact upon the Debtors of not obtaining the relief sought in the
First Day Motions and Other Applications.
63. As described more fully below, the relief sought in the First Day Motions and
Other Applications will minimize the adverse effects of the chapter 11 cases on the Debtors and
ensure that the Debtors’ reorganization effort proceeds as efficiently as possible and results in
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Case 19-61688-wlh Doc 169 Filed 10/18/19 Entered 10/18/19 17:08:55 Desc Main

IT IS ORDERED as set forth below:

Date: October 18, 2019

UNITED STATES BANKRUPTCY COURT

ORDER (I) AUTHORIZING THE SALE OF SUBSTANTIALLY ALL OF THE

good cause appearing therefore:#

This Court hereby FINDS and CONCLUDES as follows:1

of the Bankruptcy Rules, and the Complex Case Procedures.

C. Origin Bank Pre-Petition Secured Debt and DIP Financing. As of the

recoupment, or offset of any kind, in the approximate non-contingent liquidated amount of no

WcbbYWh]cb h\YfYk]h\ &h\Y pCure Amountsq'*

E. Compliance with Bid Procedures Order. As demonstrated by evidence

F. Notice. As evidenced by the certificates or affidavits of service filed with the

G. Opportunity to Object. A fair and reasonable opportunity to object or be heard

persons and entities.

other parties in interest.

M. Assumption and Assignment of Executory Contracts and Unexpired Leases.

N. Cure/Adequate Assurance Related to Designated Contracts. The Purchaser

soon as reasonably practicable.

P. Purchaser Not an Insider and No Successor Liability. The Purchaser is not an

Debtors or the Debtorsr bankruptcy estates.

terms of the APA.

It is therefore ORDERED, ADJUDGED, and DECREED that:

1. The Motion is GRANTED and APPROVED in all respects as set forth in

on the merits and denied with prejudice.

Approval of the Sale of the Acquired Assets

3. The APA, including any amendments, supplements, and modifications thereto,

and all of the terms and conditions therein, is hereby approved.

other than the Assumed Liabilities.

Sale and Transfer of the Acquired Assets

additional instruments and documents that may be reasonably necessary or desirable to

implement the APA.

acquisition of the Acquired Assets.

and priority as they existed on the Petition Date.

appropriate to consummate the transactions contemplated by the APA.

Acquired Assets to the Purchaser upon the Closing of the Sale.

Purchaser in accordance with the APA and this Order.

(whether legal or equitable, secured or unsecured, matured or unmatured, contingent or

Acquired Assets, such claims or Encumbrances.

Encumbrances on the Acquired Assets, if any.

full the amount set forth for it in the PACA Notice.

Order) or pursuant to a plan or further order of the Court.

Acquired Assets or otherwise.

continuation, alter ego or substantial continuation of any of the Debtors.

to all of the protections afforded by Section 363(m) of the Bankruptcy Code.

avoided, pursuant to Section 363(n) of the Bankruptcy Code.

Assumption and Assignment of the Designated Contracts

with respect thereto are hereby deemed satisfied.

Contracts to the Purchaser.

assignment or transfer to the greatest extent permissible by law.

assumption by the Purchaser.

obligation is one of the Assumed Liabilities.

this Court is unsatisfactory to the Debtors and the Purchaser.

Designated Contract is deemed to have consented to such assignment for purposes of

the assumption and assignment of such Designated Contract.

28. To the extent a counterparty to a Designated Contract failed to object timely to a

appropriate to consummate the transactions contemplated by the APA.

and executed by the appropriate parties, termination statements, instruments of satisfaction,

respect to any of the Acquired Assets.

chapter of the Bankruptcy Code.

Court that the APA be authorized and approved in its entirety.

36. Nothing contained in any plan of reorganization or liquidation confirmed in the

commissions are due.

and provisions of the APA and this Order.

* END OF ORDER *