B-6004-5. SALE WITH PROSPECTIVE PURCHASER IDENTIFIED BUT BIDS CONSIDERED

(a)   "Sale with Prospective Purchaser Identified but Bids Considered” Defined

A “sale with prospective purchaser identified but bids considered” is also known as a “sale with a stalking horse bidder,” and is a proposed sale to a specific entity for a set price, including a credit bid from a secured creditor, with competitive bids to be considered.  

(b)   Contents of Motion to Sell with Bid Procedures

Any Motion to Sell to a prospective purchaser but with bids considered shall identify or include:

(1)     the property to be sold;

(2)     the prospective purchaser ("Prospective Purchaser");

(3)     the sales price and an estimate of the net proceeds to be received by the estate (including a deduction for any exemption);

(4)     a brief summary of all material contingencies to the sale, together with a copy of the agreement, if available;

(5)     the names of the lien or interest holders to the extent such names are known, if the proposed sale seeks to sell property free and clear of liens or other interests pursuant to 11 U.S.C. § 363(f);

(6)     the executory contracts and leases proposed to be assumed or rejected as part of the sale, if any;

(7)     a description of the manner in which the property was marketed for sale, and a description of any other offer to purchase;

(8)     a description of any known relationship between the Prospective Purchaser and its insiders and the Debtor and its insiders or the trustee;

(9)     a statement setting forth any relationship or connection the trustee or the Debtor (including its insiders) will have with the Prospective Purchaser after the consummation of the sale, assuming it is approved;

(10)   if a topping fee or break-up fee is proposed to be paid to the Prospective Purchaser if another bidder prevails at the sale, a statement of the conditions under which the topping fee or break-up fee would be payable and the factual basis on which the seller determined the provision was reasonable;

(11)   the identities of any other entity that expressed to the movant an interest in the purchase of all or a material portion of the assets to be sold within ninety (90) days prior to the filing of the sale motion, the offers made by them (if any), and the nature of the offer;

(12)   the bid procedures proposed for the sale;

(13)   a disclosure if the property to be sold contains personally identifiable information and, if so, the measures that will be taken to comply with 11 U.S.C. §363(b)(1); and

(14)   if the case is pending under Chapter 11, and proposes the sale of all or substantially all of the Debtor's assets, the following:

(A)     if schedules have not been filed by the Debtor, a summary of the Debtor's debt structure, including the amount of the Debtor's secured debt, priority claims, and general unsecured claims; and

(B)     if a creditors' committee, or its equivalent, existed pre-petition, the identity of the members of the committee and the companies with which they are affiliated and the identity of any counsel.

(c)   Notice of Motion to Sell and to Approve Bid Procedures

The movant shall prepare, for Court review, a notice of the Motion to Sell and of the proposed bid procedures that contains the information required by subsection (b) of this rule. If the Court directs a notice of the opportunity to object, the notice shall provide twenty-one (21) days after the date of service for objections to be filed, unless the Court by separate order has shortened the notice period. The Court may instead direct the issuance of a hearing notice and will provide the movant with a hearing date and time and an objection deadline, if any, that shall be included in the notice. Upon distribution of the notice, the movant shall also file a certificate of service that complies with S.D.Ind. B-9013-2.

(d)    Order Establishing Bid Procedures and Notice of Sale Hearing

Upon expiration of the objection period or upon conclusion of a hearing on the proposed bid procedures, the movant shall provide the Court with an Order Establishing Bid Procedures and Notice of Sale Hearing. The order shall include the bid procedures; the date, time, and place where bids will be considered; the date, time, and place of the hearing to approve the sale; and the deadline, if any, by which parties must object to the proposed sale.  Upon entry of the order, the movant shall make distribution and shall also file a certificate of service that complies with S.D.Ind. B-9013-2.

(e)   Order Approving Sale

(1)     Sale to Prospective Purchaser

If the Prospective Purchaser prevails at the sale, then the Court shall enter an order approving that sale.

(2)     Sale to Different Entity:  No Change in Terms Except Price

If a sale pursuant to this rule results in a sale to a party other than the identified Prospective Purchaser, with no change in terms other than the purchase price, then at the hearing on approval of the sale the movant shall identify the successful purchaser and the change in price, and shall make any request for approval of a topping or break-up fee if one was disclosed in the Motion to Sell. The Court shall enter an order approving that sale.

(3)     Sale to Different Entity with Change in Terms

If a sale pursuant to this rule results in a sale to a party other than the identified Prospective Purchaser, and the terms of that sale other than price have changed, including but not limited to the proposed assumption or rejection of leases and contracts, then the movant shall identify the successful purchaser and the change in terms and shall make any request for approval of a topping or break-up fee if one was disclosed in the Motion to Sell. The Court shall consider whether the change in terms requires additional notice to parties who may be affected by those changes.  If no additional notice is required, the Court shall enter an order approving the sale.  If additional notice is required, the Court shall enter the order approving the sale only after such additional notice period.

(f)   Report of Sale

No later than fourteen (14) days after a sale pursuant to this rule has been completed, the movant shall file a report of sale pursuant to Fed.R.Bankr.P. 6004(f)(1).