According to the U.S. Bankruptcy Court docket, CMG Oil & Gas filed an objection to American Eagle Energy’s motion for orders authorizing the sale of substantially all of Debtors’ assets free and clear of liens, claims, encumbrances and other interests.
The objection asserts, “The Debtors cannot satisfy the requirements of 11 U.S.C. sections 363 (f). In the motion, Debtors seek authority to sell all of the Purchased assets free and clear of all liens, except for certain permitted liens that expressly survive the closing pursuant to the Asset Purchase Agreement.”
The reply continues, “CMG’s liens are arguably Permitted Liens which would not be subject to divestment under the terms of the sale of the lease burdens on the particular leaseholds do not exceed the net revenue interest described in Section 1.1 (b) of the Seller Disclosure Schedule….Second, CMG does not consent to the sale of the American Eagle Leaseholds free and clear of CMG’s construction liens….Third, the Motion does not claim competitive bidding will result in proceeds sufficient to pay all liens on the American Eagle Leaseholds in full. The Motion appears to promise more than the Debtors may be able to deliver….Although the Motion claims CMG’s interests will be paid in full in connection with this Chapter 11 case, the Debtors fail to identify how CMG will be paid in full.”
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