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University General Health System 363 Sale Procedures Approval Sought

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According to the U.S. Bankruptcy Court docket, University General Health System filed a motion for entry of (I) an order (a) establishing bid procedures related to the sale of the Debtors’ assets, (b) scheduling a hearing to consider the proposed sale and approving the form and manner of notice thereof, (c) establishing procedures relating to the assumption and assignment of certain executory contracts and unexpired leases including notice of proposed cure amounts and (d) granting related relief and (II) an order (a) approving the proposed sale, (b) authorizing the assumption and assignment of certain executory contracts and unexpired leases and (c) granting related relief.

The motion explains, “The Debtors seek approval of certain bid procedures related to a sale of substantially all of their hospital assets (the ‘Transferred Assets’) free and clear of all liens, claims, interests and encumbrances under 11 U.S.C. section 363(f)….The Debtors also seek entry of the Sale Order approving a sale to the highest and best bid received at auction and authorizing the assumption and assignment of certain executory contracts and unexpired leases. The requested timeline for the proposed bid procedures and sale will allow the Debtors to comply with the reorganization milestones contained in Amendment No. 3 to Debtor in Possession Credit and Security Agreement, which this Court authorized the Debtors to execute on October 5, 2015….Specifically, the current reorganization milestones require the entry of a sale order or confirmation order by no later than November 9, 2015.”

The deadline to submit bids is November 3, 2015. If at least one qualifying bid is received, an auction (if necessary) will be conducted on November 5, 2015 followed by a November 9, 2015 sale hearing. The Debtors filed a separate motion for expedited consideration of this procedures motion.

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