United States Bankruptcy Court for the District of Delaware
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Case 21-10461-JTD Doc 322 Filed 06/04/21 Page 1 of 86 UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re: Chapter 11 CMC II, LLC,1 Case No. 21-10461 (JTD) Debtors. (Jointly Administered) AFFIDAVIT OF SERVICE I, Jesse Brown, depose and say that I am employed by Stretto, the claims and noticing agent for the Debtors in the above-captioned cases. On May 28, 2021, at my direction and under my supervision, employees of Stretto caused the following documents to be served via first-class mail on the service list attached hereto as Exhibit B, and via electronic mail on the service list attached hereto as Exhibit C: • Notice of Filing of Asset Purchase Agreement (Docket No. 295) • Notice of Filing of Proposed Order (A) Approving and Authorizing the Sale of the Debtors’ Skilled Nursing Facility Assets Free and Clear of Liens, Claims, Encumbrances, and Interests, (C) Authorizing the Assumption and Assignment of Executory Contracts and Unexpired Leases, and (D) Granting Related Relief (Docket No. 296) • Debtors’ Omnibus Reply to Objections to Debtors’ Motion for Approval of Sale of the SNF Assets (Docket No. 297) • Notice of Agenda of Matters Scheduled for Hearing on June 2, 2021 at 1:00 PM (Prevailing Eastern Time) (Docket No. 299) • Order Scheduling Omnibus Hearing Date (Docket No. 300) • Order Pursuant to Bankruptcy Rule 3003(c) and Local Rule 2002-1(e) Establishing Bar Dates and Related Procedures for Filing Proofs of Claim (Including for Administrative Expense Claims Arising Under Section 503(b)(9) of the Bankruptcy Code) and Approving the Form and Manner of Notice Therefore (Docket No. 301) 1 The Debtors in these chapter 11 cases, along with the last four digits of their respective tax identification numbers, are as follows: CMC II, LLC (6973), Salus Rehabilitation, LLC (4037), 207 Marshall Drive Operations LLC (8470), 803 Oak Street Operations LLC (3900), Sea Crest Health Care Management, LLC (2940), and Consulate Management Company, LLC (5824). The address of the Debtors’ corporate headquarters is 800 Concourse Parkway South, Maitland, Florida 32751. Case 21-10461-JTD Doc 322 Filed 06/04/21 Page 2 of 86 • Order (I) Scheduling a Hearing to Consider Approval of the Sale of the Debtors’ Manager and Remaining Assets, and the Assumption and Assignment of Certain Executory Contracts and Unexpired Leases, (II) Approving Certain Bidding Procedures, Assumption and Assignment Procedures, and the Form and Manner of Notice Thereof, and (III) Granting Related Relief (Docket No. 302) • Notice of Auction and Sale of Assets, attached hereto as Exhibit A • Notice of Deadline for the Filing of Proofs of Claim, Including for Claims Asserted Under Section 503(b)(9) of the Bankruptcy Code (Docket No. 304) • Official Form 410 Proof of Claim Form • Official Form 410 Instructions for Proof of Claim Form Furthermore, on May 28, 2021, at my direction and under my supervision, employees of Stretto caused the following documents to be served via first-class mail on the service list attached hereto as Exhibit D, and via electronic mail on the service list attached hereto as Exhibit E and one hundred and fifty (150) confidential, interested parties not included herein: • Notice of Filing of Asset Purchase Agreement (Docket No. 295) • Notice of Filing of Proposed Order (A) Approving and Authorizing the Sale of the Debtors’ Skilled Nursing Facility Assets Free and Clear of Liens, Claims, Encumbrances, and Interests, (C) Authorizing the Assumption and Assignment of Executory Contracts and Unexpired Leases, and (D) Granting Related Relief (Docket No. 296) • Debtors’ Omnibus Reply to Objections to Debtors’ Motion for Approval of Sale of the SNF Assets (Docket No. 297) • Notice of Agenda of Matters Scheduled for Hearing on June 2, 2021 at 1:00 PM (Prevailing Eastern Time) (Docket No. 299) • Order (I) Scheduling a Hearing to Consider Approval of the Sale of the Debtors’ Manager and Remaining Assets, and the Assumption and Assignment of Certain Executory Contracts and Unexpired Leases, (II) Approving Certain Bidding Procedures, Assumption and Assignment Procedures, and the Form and Manner of Notice Thereof, and (III) Granting Related Relief (Docket No. 302) • Notice of Auction and Sale of Assets, attached hereto as Exhibit A Furthermore, on May 28, 2021, at my direction and under my supervision, employees of Stretto caused the following documents to be served via first-class mail on the service list attached hereto as Exhibit F and six hundred and sixty-six (666) confidential parties not included herein: Case 21-10461-JTD Doc 322 Filed 06/04/21 Page 3 of 86 Case 21-10461-JTD Doc 322 Filed 06/04/21 Page 4 of 86 Exhibit A Case 21-10461-JTD Doc 322 Filed 06/04/21 Page 5 of 86 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re: Chapter 11 CMC II, LLC et al.,1 Case No. 21-10461 (JTD) Debtors. (Jointly Administered) NOTICE OF AUCTION AND SALE OF ASSETS PLEASE TAKE NOTICE REGARDING THE FOLLOWING: 1. On March 1, 2021, CMC II, LLC and its affiliates, as debtors and debtors-in- possession (the “Debtors”) each filed a voluntary petition for relief pursuant to chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”) in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). 2. The Debtors have entered an Asset Purchase Agreement (the “Manager and Remaining Assets Stalking Horse APA”) with CPSTN Operations, LLC (the “Manager and Remaining Assets Stalking Horse Bidder”) by which the Manager and Remaining Assets Stalking Horse Bidder or its designee, as permitted pursuant to the Manager and Remaining Assets Stalking Horse APA, will acquire all or substantially all of the assets of CMC II, LLC as well as certain other assets, including certain claims and causes of action of the Debtors’ estates (the “Manager and Remaining Assets”). 3. On March 11, 2021, in connection with a proposed sale of the Assets pursuant to section 363 of the Bankruptcy Code (the “Sale”) to the successful bidders (the “Successful Bidders”) at an auction, if necessary (the “Auction”), the Debtors filed a motion (the “Motion”)2 seeking approval of bidding procedures, procedures for contract assumption/ assignments, and scheduling a Sale Hearing, among other things. 4. By order, dated May 28, 2021 (Docket No. 302) (the “Manager and Remaining Assets Bidding Procedures Order”), the Bankruptcy Court approved the bidding procedures (the “Manager and Remaining Assets Bidding Procedures”) that govern the sale of, or other transaction to acquire, the Manager and Remaining Assets by the highest and best bidder. Pursuant to the Manager and Remaining Assets Bidding Procedures Order, if one or more Qualified Bids are received before the Bid Deadline (as defined below), the Debtors will conduct the Auction among such Qualified Bidders to determine the highest and best Qualified Bid, beginning on July 26, 2021, at 10 a.m. (Eastern). The Auction shall be conducted by telephone or 1 The Debtors in these chapter 11 cases, along with the last four digits of their respective tax identification numbers, are as follows: CMC II, LLC (6973), Salus Rehabilitation, LLC (4037), 207 Marshall Drive Operations LLC (8470), 803 Oak Street Operations LLC (3900), Sea Crest Health Care Management, LLC (2940), and Consulate Management Company, LLC (5824). The address of the Debtors’ corporate headquarters is 800 Concourse Parkway South, Maitland, Florida 32751. 2 Capitalized terms not otherwise defined herein shall have the meanings ascribed to such terms in the Motion. Case 21-10461-JTD Doc 322 Filed 06/04/21 Page 6 of 86 videoconference or such other means that the Debtors may choose, from the offices of Chipman, Brown, Cicero & Cole, LLP, Hercules Plaza, 1313 North Market Street, Suite 5400, Wilmington, Delaware 19801. The Debtors shall notify all bidders that have submitted Qualified Bids (including the Manager and Remaining Assets Stalking Horse Bidder), counsel to the Official Committee of Unsecured Creditors appointed in these chapter 11 cases, Consultation Parties, and any creditors or other persons that have informed the Debtors they plan to attend of the telephone or videoconference dial-in. 5. Only Qualified Bidders that have submitted Qualified Bids by July 19, 2021, at 5:00 p.m. (Eastern) (the “Bid Deadline”) are eligible to participate in the Auction, subject to the terms of the Manager and Remaining Assets Bidding Procedures and other limitations as may reasonably be imposed by the Debtors. All Qualified Bids, with the exception of the Manager and Remaining Assets Stalking Horse Bid, must be accompanied with a deposit in an amount equal to ten percent (10%) of the total cash consideration provided under the proposed Manager and Remaining Assets Purchase Agreement. Creditors may attend the Auction but not participate. 6. Qualified Bidders participating in the Auction must appear by telephone, videoconference or by such other means as the Debtors may approve in their sole discretion. Duly authorized representatives of such Qualified Bidders may also participate in the Auction by such means. Only the Debtors, Qualified Bidders (including the Manager and Remaining Assets Stalking Horse Bidder), and the Consultation Parties, together with their respective professional advisors may attend and participate in the Auction, also by telephone, videoconference, or by such other means as the Debtors may approve in their sole discretion. Only Qualified Bidders (including the Manager and Remaining Assets Stalking Horse Bidder) will be entitled to make any Bids at the Auction. For the avoidance of doubt, the Consultation Parties may attend the Auction without sending prior written notice of their intention to do so. Creditors may attend the Auction but not participate. 7. If the Debtors do not receive a Qualified Bid (other than that of the Manager and Remaining Assets Stalking Horse Bidder), the Debtors will not conduct an Auction and shall designate the Manager and Remaining Assets Stalking Horse Bidder as the Successful Bidder.