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Full title: Objection to confirmation of plan (RE: related document(s)700 Chapter 11 plan) filed by Creditor Spring Branch ISD. (Valdez, Melissa)

Document posted on Mar 9, 2021 in the bankruptcy, 6 pages and 0 tables.

Bankrupt11 Summary (Automatically Generated)

The Honorable United States Bankruptcy Judge COME NOW Plano Independent School District, Arlington Independent School District, Spring Branch Independent School District, Richardson Independent School District, Grapevine-Colleyville Independent School District, City of Houston, Harris County Water Control and Improvement District #145, and City of Colleyville, secured creditors and parties in interest (the “Certain Texas Taxing Entities”) and file this Objection to the Second Amended Joint Chapter 11 Plan of Reorganization for Studio Movie Grill Holdings, LL and Jointly Administered Debtors (the “Plan”)(Doc.Taxing Entities are political subdivisions of the State of Texas, authorized and required by the Texas Constitution and laws to levy and collect taxes on taxable property within their boundaries, in order to operate and discharge their public purposes.The Plan proposes to treat Class 3 – Secured Tax Claims as follows: 1 The Certain Texas Taxing Entities recognize that if there are any claims in this case filed under the Perishable Agricultural Commodities Act (“PACA”) that such claims could be adjudicated as taking secured priority over the Tax Claims.Respectfully submitted, PERDUE, BRANDON, FIELDER, COLLINS & MOTT, L.L.P. Attorneys for The Certain Texas Taxing Entities 1235 North Loop West, Suite 600 Houston, Texas 77008 (713) 862-1860 (phone) (713) 862-1429 (fax) 1919 S. Shiloh Road, Suite 310, LB 40 Lisa L. Lambert via email: lisa.l.lambert@usdog.gov Meredyth Kippes via email: maeredyth.a.kippes@usdoj.gov COUNSEL TO THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS Pachulski Stang Ziehl & Jones LLP 780 Third Avenue, 34th Floor New York, NY 10017-2024

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IN THE UNITED STATES BANKRUPTCY COURT FOR THE NORTHERN DISTRICT OF TEXAS DALLAS DIVISION IN RE: § § STUDIO MOVIE GRILL § HOLDINGS, LLC, et al § CASE NO. 20-32633-SGJ § § Chapter 11 Debtors § (Jointly Administered) THE CERTAIN TEXAS TAXING ENTITIES’ OBJECTION TO THE SECOND AMENDED JOINT CHAPTER 11 PLAN OF REORGANIZATION FOR STUDIO MOVIE GRILL HOLDINGS, LLC AND JOINTLY ADMINISTERED DEBTORS (Relates to Doc. No. 700) To: The Honorable United States Bankruptcy Judge COME NOW Plano Independent School District, Arlington Independent School District, Spring Branch Independent School District, Richardson Independent School District, Grapevine-Colleyville Independent School District, City of Houston, Harris County Water Control and Improvement District #145, and City of Colleyville, secured creditors and parties in interest (the “Certain Texas Taxing Entities”) and file this Objection to the Second Amended Joint Chapter 11 Plan of Reorganization for Studio Movie Grill Holdings, LL and Jointly Administered Debtors (the “Plan”)(Doc. No. 700). Background 1. The Certain Texas Taxing Entities are political subdivisions of the State of Texas, authorized and required by the Texas Constitution and laws to levy and collect taxes on taxable property within their boundaries, in order to operate and discharge their public purposes. 2. The Certain Texas Taxing Entities hold secured pre-petition tax claims for the 2020 tax year (the “Tax Claims”). The Tax Claims are secured by tax liens on the real and tangible business

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personal property of the Debtor. Additionally, the liens for the 2021 tax year attached to the Debtors’ property on January 1, 2021. 3. The Certain Texas Taxing Entities’ tax liens (the “Tax Liens”) are senior to any other secured claim in this case as provided by Article VIII, Section 15 of the Texas Constitution, and Section 32.01 and Section 32.05(b) of the Texas Property Tax Code1. See also Stanford v. Butler, 826 F.2d 353 (5th Cir. 1987): Universal Seismic Associates, Inc. 288 F.3d 205 (5th Cir. 2002); In Re Winn’s Stores, Inc. 177 B.R. 253 (Bktcy W.D. Tex. 1995). Proposed Plan Treatment 4. The Plan proposes to treat Class 3 – Secured Tax Claims as follows: 1 The Certain Texas Taxing Entities recognize that if there are any claims in this case filed under the Perishable Agricultural Commodities Act (“PACA”) that such claims could be adjudicated as taking secured priority over the Tax Claims. The Certain Texas Taxing Entities do not know of any such PACA claims in this case and do not concede that such priority exists without further Court determination.

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Limited Objections 5. The Certain Texas Taxing Entities objects to confirmation of the Plan in that it fails to provide for the retention of their pre-petition and post-petition liens on its collateral. The Plan should not be confirmed unless and until it specifically provides for the Certain Texas Taxing Entities pre- and post-petition liens to remain on the Debtor’s real and tangible personal property until the pre- and post-petition taxes are paid in full, with interest that has accrued post-petition and may accrue in the future. 6. The Certain Texas Taxing Entities object to the confirmation of the Plan in that it fails to provide for the payment of interest on their claims at the applicable non-bankruptcy rate from date of delinquency until paid in full as required by 11 U.S.C. § 511 and Texas law. 7. The Certain Texas Taxing Entities object to confirmation of the Plan in that it provides the Debtors an option to return collateral securing the Tax Claims to the members of Class 4 - Other Secured Claims. Such return of the collateral would result in preferential treatment of the claims of junior secured creditors. 8. The Certain Texas Taxing Entities object to confirmation of the Plan to the extent it fails to comply with the requirements of 11 U.S.C. § 1129(a) by failing to provide payment of the Tax Claims with any specificity. The Certain Texas Taxing Entities cannot determine when or how they will be paid. 9. The Certain Texas Taxing Entities object to confirmation of the Plan to the extent it unfairly discriminates in the treatment of the claims of similarly situated creditors. 10. The Certain Texas Taxing Entities object to confirmation of the Plan in that it requires prior approval for the amendment of claims. In the event that the Tax Claims include amounts that are

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estimated, the Certain Texas Taxing Entities should be allowed to amend those claims upon the certification of the ad valorem tax amounts. 11. The Certain Texas Taxing Entities object to confirmation of the Plan because it fails to provide for a clear provision for notice of and remedies for default. Pursuant to 11 USC §1123(a)(5)(G), the plan must provide for an adequate means for plan implantation such as “curing or waiving any default.” 12. The Certain Texas Taxing Entities object to the confirmation of the plan to the extent that they are required to file administrative claims for post-petition taxes. Pursuant to 11 USC §503(b)(1)(D), governmental unites are not required to file a request for payment of administrative expenses such as post-petition taxes. 13. The Certain Texas Taxing Entities object to the confirmation of the plan to the extent if fails to provide for the payment of post-petition taxes in the ordinary course of busines prior to delinquency, making the failure to pay such taxes an event of default under the Plan. 14. Counsel for the Certain Texas Taxing Entities has attempted to confer with counsel for the Debtors and no response was received. Prayer WHEREFORE, The Certain Texas Taxing Entities respectfully request that the Court deny confirmation of the Plan, until and unless the Objection is remedied, and grant them such other and further relief as is just. Respectfully submitted, PERDUE, BRANDON, FIELDER, COLLINS & MOTT, L.L.P. Attorneys for The Certain Texas Taxing Entities 1235 North Loop West, Suite 600 Houston, Texas 77008

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(713) 862-1860 (phone) (713) 862-1429 (fax) 1919 S. Shiloh Road, Suite 310, LB 40 Garland, TX 75042 (972) 278-8282 (phone) (817) 860-6509 (fax) /s/ Melissa E. Valdez Melissa E. Valdez Texas State Bar No. 24051463 Linda D. Reece Texas State Bar No. 24065471 CERTIFICATE OF SERVICE I hereby certify that on March 10, 2021 a true and correct copy of the foregoing document was served by the Electronic Case Filing System for the United States Bankruptcy Court for the Northern District of Texas, including but not limited to the following: DEBTORS’ COUNSEL Law Offices of Frank J. Wright 2323 Ross Avenue, Suite 730 Dallas, Texas 75201 Frank Jennings Wright via email: frank@fjwright.law Jeffery M. Veteto via email: jeff@fjwright.law Nicholas J. Morin, Esq. via email: morin@jonesday.com UNITED STATES TRUSTEE 1100 Commerce Street Room 976 Dallas, TX 75202 Lisa L. Lambert via email: lisa.l.lambert@usdog.gov Meredyth Kippes via email: maeredyth.a.kippes@usdoj.gov COUNSEL TO THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS Pachulski Stang Ziehl & Jones LLP 780 Third Avenue, 34th Floor New York, NY 10017-2024 Robert Joel Feinstein via email to: rfeinstein@pszjlaw.com

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Steven William Golden via email: sgolden@pszjlaw.com Jeffery Nathan Pomerantz via email: jpomerantz@pszjlaw.com Hayley R. Winograd via email: hwinograd@pszjlaw.com Norton Rose Fulbright US LLP 2200 Ross Avenue, Suite 3600 Dallas, TX 75201 Ryan E. Manns via email: ryan.manns@nortonrosefulbright.com COUNSEL TO AGENT Vinson & Elkins LLP 2001 Ross Ave., Suite 3900 Dallas, Texas 75201 William L. Wallander, Esq. via email: bwallander@velaw.com Bradley R. Foxman, Esq. via email: bfoxman@velaw.com COUNSEL TO CRESTLINE Jones Day 250 Vesey Street, New York New York 10281 John E. Mazey, Esq. via email: jemazey@jonesday.com Michael C. Schneidereit, Esq. via email: mschneidereit@jonesday.com Nicholas J. Morin, Esq. via email: morin@jonesday.com And all other parties via CM/ECF-enotice. /s/ Melissa E. Valdez Melissa E. Valdez