Free Designated Record on Appeal - District Court of Delaware - Delaware

Case 1:07-cv-00621-GMS

Document 4

Filed 10/10/2007

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IN THE UNITED STATES BANUPTCY COURT
FOR THE DISTRICT OF DELAWARE

In re:

EXAERIS, INC., et aI.,
Debtors.

) ) ) ) ) )

Chapter 11

Case No. 07-10887 (KG) and Case No. 07-10888 (KG) (Jointly Admnistered)

CHAPTER 11 TRUSTEE OF INYX USA, L TD.'S COUNTER-DESIGNATION OF RECORD AND COUNTER-STATEMENT OF ISSUES WITH RESPECT TO APPELLANT DR. JACK KACHKAR'S APPEAL OF FINAL POSTPETITION FINANCING ORDER ENTERED BY THE BANKRUPTCY COURT ON SEPTEMBER 27.2007 (DOCKET NO. 179)
Pursuant to Rule 8006 of the Federal Rules of Bankrptcy Procedure, Stephen S.
Gray, the Chapter 11 Trustee (the "Trustee") of the Debtor, Inyx USA, Ltd. (the "Debtor")
submits this counter-statement of the issues on appeal and counter-designation of additional

items to be included on the record on appeal in connection with the appeal fied by Jack Kachkar

("Kachkar") from an order of the United States Bankrptcy Court for the District of Delaware

(the "Bankrptcy Court"), dated September 7,2007, titled "Final Order as to Debtor Inyx USA,
Ltd. (Case No. 07-10888) (I) Authorizing the Use of Cash Collateral Pursuant to 11 US.c.

§ 363, (II) Granting Adequate Protection to Westernbank Puerto Rico as the Prepetition Lender,

(III) Authorizing Postpetition Financing, (IV) Granting Liens and Superpriority Administrative

Expense Status Pursuant to 11 US.C. §§ 363 and 364, and (V) Modifying Automatic Stay

Pursuant to 11 US.C. § 362" (Docket No. 179) (the "Westernbank Final DIP Order" and, the
credit extended thereby, the "Westernbank Financing"), and respectfully submits:

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COUNTER-STA TEMENT OF ISSUES ON APPEAL
1. Is Kachkar's appeal from the Westernbank Final DIP Order moot pursuant

to section 364(e) of

the Bankrptcy Code because the Bankrptcy Court found that Westernbank

extended the Westernbank Financing in good faith to the Debtor, which Kachkar's counsel

acknowledged, admitted and agreed to at the August 23,2007 hearng on the Westernbank
1 Financing.

2. Is Kachkar's appeal from the Westernbank Final DIP Order moot because

the liens granted to Westernbank pursuant to the Westernbank Final DIP Order appealed from do not, contrary to Kachkar's assertions, prime any lien previously granted to Kachkar pursuant to
the Interim Order dated J ul y 11, 2007 (the "Kachkar Interim DIP Order") entered on the Kachkar

financing (the "Kachkar DIP") in the procedurally consolidated chapter 11 cases.
3. Is the Bankrptcy Court's interpretation of its Kachkar Interim DIP Order

clearly erroneous with respect to the extent of the liens granted to Kachkar by the Kachkar
Interim DIP Order, on which interpretation depends the question of whether those liens were
primed by the Westernbank Final DIP Order.
4. Are the Bankruptcy Court's specific findings that the Westernbank

Financing was negotiated and extended in good faith and at ar's length between the Trustee

and Westernbank, and for valid business purposes and uses, and hence that Westernbank is

entitled to the protections and benefits of section 364(e) of the Bankrptcy Code, clearly
erroneous.

i Transcript of

Bankuptcy Court Hearing held on August 23,2007, page 11, lines 3-6.

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COUNTER-DESIGNA TION OF RECORD

The Trustee counter-designates the following items to be included in the record
on appeaL Each designated item includes any exhibits to such item.
Docket No.

Description
Emergency Motion Of Westernbank Puerto Rico For Adequate Protection And To Prohibit Use Of Cash Collateral, dated July 9, 2007
Objection By Westernbank Puerto Rico To The Debtors' Motion: (I) To Authorize Secured Postpetition Financing; (II) To Grant A Super-Priority Administrative Claim And Postpetition Liens; And
(il) To Schedule A Final Hearng, dated July 10, 2007

17

26

46

Order Granting Motion For Adequate Protection, dated July 12, 2007
Supplemental Objection Of Westernbank Puerto Rico To Debtors' Motion For Final Approval Of Secured Postpetition Financing And Related Relief, dated July 24, 2007

74

122

Order (SECOND INTERIM): (I) Authorizing Secured Postpetition
Financing; (II) Granting a Super-Priority Admnistrative Claim and Postpetition Liens; and (III) Scheduling a Final Hearng, dated August 8, 2007

168

Order (THI INTERIM): (I) Authorizing Secured Postpetition
Financing; (II) Granting a super-Priority Administrative Claim and Postpetition Liens; and (il) Scheduling a Final Hearng, dated
September 6, 2007

195

Order (FOURTH INTERIM): (I) Authorizing Secured Postpetition Financing; (II) Granting a Super-Priority Administrative Claim and
Postpetition Liens; and (III) Scheduling a Final Hearng, dated
September 24, 2007

240

Transcript of Hearing held on September 7, 2007 before the
Honorable Kevin Gross, dated October 9,2007

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Dated: October 9, 2007 Wilmington, Delaware

~~

P ACHUSKI STANG ZIEHL & JONES LLP
Richard Pachulski (CA Bar No. 90073) Bruce Grohsgal (Bar No. 3583)
919 North Market Street, 17th Floor

P.O. Box 8705 Wilmington, Delaware 19899-8705 (Courier 19801)
Telephone: (302) 652-4100
Facsimile: (302) 652-4400

Email: bgrohsgal(Qpszyjw.com

Counsel for the Chapter 11 Trustee

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