BIDDING PROCEDURES
XxxxxxxxxXxx.xxx,
Inc. (the "Debtor) has entered into an asset purchase agreement (the "APA),
dated on or about August 29, 2008, with NRG Heat & Power, LLC (the
"Purchaser), for the sale of substantially all of the assets of the Debtor
(as
more fully described in the Purchase Agreement, including the assumption of
certain liabilities and executory contracts, the "Purchased Assets) and are
soliciting other higher or better bids for the sale of the Debtors
assets.
Participation
and Qualification Requirements
All
Bids
(as defined below) must be submitted in writing so that they are actually
received no later than 5:00 PM (Eastern
time)
on September 30, 2008 at 4:00 pm (the "Bid Deadline"). Each Qualified Bidder
(as
defined below) must deliver copies of its Bid to: Xxxxx Xxxxxxxxxx Xxxxx &
Xxxx, P.C., Xxx Xxxxx Xxxxxxxx, Xxxxx 000, Xxxxx Xxxxxx, XX 00000, Attention:
Xxxx Xxxxxxxx, Esq., counsel for Debtor.
Formal
binding unconditional bids must contain:
an
executed "clean" version of a sale agreement no less favorable than those
proposed by the Purchaser in the APA (a "Modified Sale Agreement"), together
with a blackline to reflect the changes from the APA executed by Debtor and
such
Modified Sale Agreement shall have a value, taking into account for such
purposes the value of any assets excluded from such bid and the value of any
liabilities assumed by such bid, as determined in the discretion of the Debtor,
that exceeds by not less than $10,000.00 the consideration provided by the
Purchaser; a letter setting forth the identity of the bidder (including an
authorized representative thereof, such bidder's counsel), and contact
information for such bidder, its authorized representative and its
counsel;
written
evidence of a commitment for financing or other evidence of the bidder's
financial ability to consummate the sale (in a form satisfactory to Debtor
in
its discretion).
written
evidence of a credit line with reputable suppliers of home heating oil of at
least $1.50 million, necessary to meet obligations under the assumed customer
contracts.
written
acknowledgment that such bid is unconditional and not contingent upon any event,
including, without limitation, any due diligence investigation, expense
reimbursement, termination fee or the receipt of financing or any further
bidding approval.
written
evidence that the bidder has the requisite corporate or similar authority to
consummate the investment or sale.
written
acknowledgment that such proposal is irrevocable until the effective date of
a
transaction implementing the Successful Bid (as defined herein) and providing
for the consummation of the transaction to occur no later than ten (10) days
after the Bankruptcy Court approves the transaction.
an
xxxxxxx money deposit in an amount of equal to ten (10%) of the purchase price
(each a "Good Faith Deposit");
sufficient
information to permit the Bankruptcy Court, Debtor, and applicable lessors
and/or contracting parties to determine the proposed assignee's ability to
comply with section 365 of the Bankruptcy Code (to the extent applicable),
including providing adequate assurance of such assignee's ability to perform
in
the future; and
such
other information as Debtor may reasonably request.
Bids
that
contain the foregoing shall be "Qualified Bids." Persons that comply with the
foregoing shall be "Qualified Bidders." NO
CONDITIONS RELATING TO THE COMPLETION OF DUE DILIGENCE SHALL BE PERMITTED TO
EXIST AFTER THE BID DEADLINE.
For
all
purposes hereof, the Purchaser's offer to acquire the Purchased Assets pursuant
to the APA shall constitute a Qualified Bid.
Obtaining
Due Diligence Access
Interested
bidders requesting information about the qualification process, including a
form
asset purchase agreement, and/or information in connection with their due
diligence, should contact Xxxx Xxxxxxxx, Esq. at Xxxxx Xxxxxxxxxx Xxxxx &
Xxxx, Xxx Xxxxx Xxxxxxxx, Xxxxx 000, Xxxxx Xxxxxx, XX 00000, (000)
000-0000.
Debtor
shall coordinate all reasonable requests for additional information and due
diligence access from potential Qualified Bidders.
Interested
bidders shall execute a confidentiality agreement with respect to proprietary
information including but not limited to information regarding customer
contracts.
"As
Is, Where Is"
The
sale
of the Assets shall be on an "as is, where is" basis and without representations
or warranties of any kind, nature or description by Debtor or Debtor's
estate.
Auction
If
a
Qualified Bid (other than the bid of the Purchaser) is received by the Bid
Deadline an auction shall take place before a court reporter as
follows:
(a)
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If
more than one Qualified Bid has been received by the Debtor, the
Debtor
will conduct an auction on October 3, 2008 at 8:30 a.m. (the "Auction")
at
the offices of Xxxx Xxxxxxxx, Xxxxx Xxxxxxxxxx Xxxxx & Xxxx, P.C., Xxx
Xxxxx Xxxxxxxx, Xxxxx 000, Xxxxx Xxxxxx, XX 00000. Only a Qualified
Bidder
that has submitted a Qualified Bid is eligible to participate at
the
Auction.
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(b)
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Debtor
shall consider as higher and better offers (the "Overbids") only
those
offers that meet the following
requirements:
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(1)
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Overbid
Deadline. Only a "Qualified Bidder" who has submitted a Qualified
Bid, not
later than such date and time as is specified in the Bidding Procedures
Order (the "Bid Deadline"), will be eligible to participate. Only
the
authorized representatives of each Qualified Bidder, the Debtor
shall be
permitted to attend the Auction;
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(2)
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Overbid
Requirements. At the Auction, Qualified Bidders shall be permitted
to
increase their bids. The Auction shall start at the highest purchase
price
stated in the highest or otherwise best Qualified Bid as disclosed
to all
Qualified Bidders prior to the commencement of the Auction and
continue in
increments of $10,000.00.
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(c)
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The
highest or otherwise best Qualified Bid shall be determined by
the Debtor.
Based upon the terms of the Qualified Bids submitted by the Qualified
Bidders and such other information as Debtor determines is relevant,
Debtor, may conduct the Auction in the manner it determines will
maximize
the value of its estate. Debtor may, but is not obligated to, announce
the
principal terms and conditions of or provide copies of each Qualified
Bid
submitted by the Qualified Bidders to the other Qualified Bidders
at the
Auction. Debtor may, but is not obligated to, conduct the Auction
by
requiring each Qualified Bidder to submit sealed bids. Debtor may,
but is
not obligated to, from time to time, and in an open forum, advise
the
Qualified Bidders of their determination as to the terms of the
then
highest and best Qualified Bid. Unless otherwise agreed to by Debtor,
no
Qualified Bidder will be permitted more than one-half hour to respond
to
the previous bid at Auction and, at the expiration of such time
(unless
extended), the Auction shall conclude. Any bid submitted after
the
conclusion of the Auction shall not be considered for any
purpose.
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If,
however no Qualified Bid (other than the offer of the Purchaser) is received
by
the Bid Deadline, then the Auction will not be held and the Purchaser will
be
the successful bidder and the bid of the Purchaser will be the successful bid,
and at the hearing before the Court to consider the sale of the Purchased Assets
to the Purchaser the Debtors will seek approval of an authority to consummate
the sale transaction contemplated by the APA.
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Acceptance
of Qualified Bid
After
completion of the Auction, Debtor will receive and consider the Qualified Bids
(as increased at the Auction). Debtor (a) review each Qualified Bid, as each
may
be modified at the Auction, on the basis of, among other things, the following:
(i) the amount of the proposed purchase price; (ii) the valuation of the Assets;
(iii) the ability to close the transaction; (iv) the other contractual terms
included in the proposal; (v) the speed and certainty of consummating the
transaction; and (b) identify the highest and best Qualified Bid (the
"Successful Bid") and the bidder making such Bid (the "Successful Bidder")
and
the next highest and best Qualified Bid (the "Second Best Bid") and the bidder
making such Bid (the "Second Best Bidder").
At
the
Sale Hearing, Debtor shall present to the Bankruptcy Court for approval both
the
Successful Bid and the Second Best Bid. Subject to Court approval, Sellers
shall
effect the Sale with the Successful Bidder. If, for any reason, the Successful
Bidder fails to close the Sale contemplated by its Successful Bid, then, without
notice to any other party or further Court order, Sellers shall be authorized
to
close with the Qualified Bidder that submitted the Second Best Bid.
Debtor
shall have accepted a Qualified Bid only when (i) the Bid is declared the
Successful Bid, (ii) the Bankruptcy Court has approved the Successful Bid and
an
order approving such Bid has been docketed, (iii) definitive documentation
has
been executed in respect thereof; and (iv) the Sale closes.
Reservation
of Rights
Debtor
reserves the right, as it may determine to be in the best interests of its
estate to: (i) determine which bidders are Qualified Bidders; (ii) determine
which Bids are Qualified Bids; (iii) determine which Qualified Bid is the
highest and best proposal and which is the next highest and best proposal,
including without limitation, whether Qualified Bids for portions of the Assets,
either individually or in the aggregates are
higher and better than a Qualified Bid for substantially all of the Assets,
(iv)
reject any bid that is (a) inadequate or insufficient, (b) not in conformity
with the requirements of the Sale Procedures Order or the requirements of the
Bankruptcy Code or (c) contrary to the best interests of the Debtor and its
estate; (v) waive terms and conditions set forth herein with respect to any
or
all potential bidders, (vii) impose additional terms and conditions with respect
to any or all potential bidders, (vii) extend the deadlines set forth herein,
(viii) adjourn or cancel the Auction and/or Sale Hearing in open court without
further notice, (ix) withdraw some or all of the Assets from the sale, and
(xi)
modify the Sale Procedures as they may determine to be in the best interests
of
their estates or to withdraw the Sale Motion at any time with or without
prejudice. Without limiting the generality of the foregoing, the Debtor may
determine to (i) distribute or not distribute copies of other Qualified Bids
to
other Qualified Bidders prior to or during the Auction or (ii) proceed with
sealed bidding.
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Return
of Good Faith Deposit
Except
as
otherwise provided in this paragraph with respect to the Successful Bidder
and
the Second Best Bidder, the Good Faith Deposits of all Qualified Bidders
required to submit such a deposit under the Sale Procedures shall be returned
upon or within one (1) business day after entry of the Sale Order. The Good
Faith Deposit of the Successful Bidder shall be held until the closing of a
Sale
and applied in accordance with the Successful Bid. The Good Faith Deposit of
the
Second Best Bidder shall be retained in escrow until 48 hours after the closing
of a Sale. Pending their return, the Good Faith Deposit of the Successful Bidder
and the Second Best Bidder shall be maintained in an interest bearing escrow
account. If a closing does not occur, the disposition of Good Faith Deposits
shall be as provided in the Successful Bid and Second Best Bid, as
applicable.
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