Escalera Resources filed with the U.S. Bankruptcy Court a motion for an order establishing bidding and sale procedures; establishing procedures related to the assumption and assignment of certain executory contracts and unexpired leases and approving the sale of assets.
The motion explains, “Debtor, together with its Senior Secured Lenders, has determined that a sale of substantially all of Debtor’s assets (the ‘Sale’) to a party to be selected pursuant to the ongoing marketing process (the ‘Stalking Horse Bidder’) or to a higher or better bidder resulting from an Auction is in the best interests of its estate and creditors. Currently, initial bids are due on July 28, 2017. Debtor and Warren will select the Stalking Horse Bidder from these initial bids….The Stalking Horse Bidder will enter into two separate purchase agreements. The first will be with the Debtor for the purchase of substantially all of the Debtor’s assets (the ‘Escalera APA’). The second will be an asset purchase agreement…for the sale of Warren’s Atlantic Rim assets.”
The motion continues, “To induce the Stalking Horse Bidder to enter into the Stalking Horse APA, Debtor requests that it be permitted to grant the customary stalking horse protection of a break-up fee. Debtor seeks approval of its portion of a breakup fee to the Stalking Horse Bidder in an amount up to 2.0% of the proposed purchase price for the Joint Assets, which amount will be allocated between Debtor and Warren in the same proportion as for allocation of the joint purchase price, in the event that Debtor consummates a Sale of Debtor’s assets to a third party whose bid was (A) selected by Warren, Debtor and the Senior Secured Lenders as a higher and better bid and (B) approved by the Court.”
The motion proposes the following general timeline: August 23, 2017 deadline to submit qualified competing bids; an auction, if necessary, would be conducted on August 28, 2017, followed by a sale hearing.
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