Exhibit 10.1

 

Strictly Private & Confidential

Subject to FRE 408 and its equivalents

 

SECOND AMENDMENT TO SENIOR SECURED SUPERPRIORITY DEBTOR-IN-POSSESSION CREDIT
AGREEMENT

 

This SECOND AMENDMENT TO SENIOR SECURED SUPERPRIORITY DEBTOR-IN-POSSESSION
CREDIT AGREEMENT (this “Second Amendment”) is entered into as of March 27, 2020,
among Dean Foods Company, a Delaware corporation and a debtor and
debtor-in-possession under chapter 11 of the Bankruptcy Code (the “Borrower”),
Coöperatieve Rabobank U.A., New York Branch, as administrative agent (the
“Administrative Agent”) and the Lenders and Voting Participants party hereto
(collectively (including any Voting Participant that provides the confirmation
set forth in Section II hereof and consents to the amendments contained herein
indirectly through consent of the Lender that participated its Loans and/or
Commitments to such Voting Participant), the “Consenting Lenders and Consenting
Voting Participants”). Capitalized terms used but not otherwise defined herein
shall have the respective meanings ascribed to such terms in the Credit
Agreement (as defined below).

 

RECITALS

 

WHEREAS, the Borrower, the Lenders party thereto and the Administrative Agent
are parties to that certain Senior Secured Superpriority Debtor-in-Possession
Credit Agreement, dated as of November 14, 2019 (as amended, restated or
otherwise modified from time to time prior to the date hereof, the “Credit
Agreement”, and the Credit Agreement as amended by this Second Amendment, the
“Amended Credit Agreement”);

 

WHEREAS, the Borrower has requested that the Administrative Agent and the
Required Lenders agree to make certain amendments and other modifications set
forth below, and the Administrative Agent and the Consenting Lenders and
Consenting Voting Participants have agreed to such amendments and other
modifications;

 

WHEREAS, on February 13, 2020, the Debtors filed that certain Motion of Debtors
for Entry of Orders (I)(a) Approving Bidding Procedures for Sale of Debtors’
Assets, (b) Approving the Designation of Dairy Farmers of America, Inc. as the
Stalking Horse Bidder for Substantially All of Debtors’ Assets, (c) Authorizing
and Approving Entry into the Stalking Horse Asset Purchase Agreement, (d)
Approving Bid Protections, (e) Scheduling Auction for, and Hearing to Approve,
Sale of Debtors’ Assets, (f) Approving Form and Manner of Notices of Sale,
Auction, and Sale Hearing, (g) Approving Assumption and Assignment procedures,
and (h) Granting Related Relief and (II)(a) Approving Sale of Debtors’ Assets
Free and Clear of Liens, Claims, Interests, and Encumbrances, (b) Authorizing
Assumption and Assignment of Executory Contracts and Unexpired leases, and (c)
Granting related relief [Docket No. 925], the filing of which was authorized by
the Administrative Agent for the purposes of Section 7.01(p)(iv) of the Credit
Agreement (such motion, the “Filed Sale Motion”); and

 

WHEREAS, on March 19, 2020, the Debtors filed an order with the Bankruptcy Court
in the form of Exhibit A attached hereto amending the bidding procedures set
forth in the Filed Sale Motion (such order, the “Amended Bid Procedures Order”),
the filing of which was authorized by the Administrative Agent for the purposes
of Section 7.01(p)(iv) of the Credit Agreement.

 

NOW, THEREFORE, in consideration of the foregoing, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:

 

Section I. Rules of Construction. The interpretive matters specified in Section
1.03 of the Credit Agreement shall apply to this Second Amendment, including the
terms defined in the preamble and recitals hereto.

 

 

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Subject to FRE 408 and its equivalents

 

Section II. Confirmation regarding Credit Agreement References to “Sale Motion”.
Upon the satisfaction of the conditions set forth in Section V of this Second
Amendment, each of the Consenting Lenders and Consenting Voting Participants
hereby confirms that each reference to the term “Sale Motion” in the Credit
Agreement (including Section 5.14 of the Credit Agreement) shall mean the Filed
Sale Motion and the Amended Bid Procedures Order for all purposes thereunder,
provided that all rights of the Administrative Agent and each of the Lenders
with respect to the form and substance of the underlying sales contemplated
therein are hereby reserved in their entirety.

 

Section III. Amendments to Credit Agreement. Effective as of the Second
Amendment Effective Date, the Credit Agreement is hereby amended as follows:

 

A.                 Sections 5.14(f) and 5.14(g) of the Credit Agreement are
hereby amended and restated in their entirety as follows:

 

“(f) if a Sale Process is elected, on or before March 27, 2020, the Bankruptcy
Court shall have entered an order approving the Sale Motion; provided, that the
Debtors may elect to switch from a Sale Process to a Plan Process on or before
April 3, 2020, subject to their filing, on or before April 3, 2020, an
Acceptable Plan and related disclosure statement (in each case, in form and
substance acceptable to the Required Lenders) with respect to such Plan Process;

 

(g) if a Sale Process is elected and not switched to a Plan Process in
accordance with the milestone set forth in section 5.14(f) above then, on or
before April 10, 2020, the Bankruptcy Court shall have entered an order
approving each sale contemplated by any relevant Sale Process (other than sales
with respect to a minority of Bid Assets (as defined in the Amended Bid
Procedures Order) where the Debtors believe, in consultation with the
Consultation Parties (as defined in the Amended Bid Procedures Order), that
extending the sale process with respect to such Bid Assets would be reasonably
likely to maximize value for the benefit of the Debtors’ estates, in accordance
with paragraph 7 of the Amended Bid Procedures Order) following completion of
the process contemplated by the bid procedures described in the Sale Motion;”

 

B.                  Section 1.01 of the Credit Agreement is amended by adding
the following defined term in the proper alphabetical order:

 

““Amended Bid Procedures Order” has the meaning assigned to such term in that
certain Second Amendment to Secured Superpriority Debtor-in-Possession Credit
Agreement, dated as of March 27, 2020, among the Borrower, the Lenders and
Voting Participants party thereto and the Administrative Agent.”

 

Section IV. Representations and Warranties. In order to induce the
Administrative Agent and the Required Lenders to provide the confirmation set
forth in Section II hereof and consent to the amendments and modifications to
the Credit Agreement set forth herein, the Borrower represents and warrants
that:

 

A.                 On and as of the Second Amendment Effective Date, (a)
immediately before and after giving effect to this Second Amendment, no Default
or Event of Default shall have occurred and be continuing and (b) each
representation and warranty of the Loan Parties and their respective Restricted
Subsidiaries contained in the Amended Credit Agreement and in each other Loan
Document shall be true and correct in all material respects (or in all respects
if the applicable representation or warranty is qualified by Material Adverse
Effect or materiality) on and as of the Second Amendment Effective Date
(provided that to the extent any such representation or warranty expressly
relates to an earlier date, such representation or warranty shall instead be
true and correct in all material respects (or in all respects if the applicable
representation or warranty is qualified by Material Adverse Effect or
materiality) as of such earlier date).

 

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B.                  Organization; Powers. Each Loan Party is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation or organization and, subject to the terms of the Final Order, has
all requisite power and authority to carry on its business as now conducted,
execute, deliver and perform its obligations under this Second Amendment and the
other instruments, agreements and documents to which it is a party and executed
and delivered in connection herewith and, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect, is qualified to do business in, and is in good
standing in, every jurisdiction where such qualification is required.

 

C.                  Authorization; Enforceability. Subject to the terms of the
Final Order, the execution, delivery and performance of this Second Amendment
and the other instruments, agreements and documents to which it is a party and
executed and delivered in connection herewith are within each Loan Party’s
corporate, limited liability company or partnership powers, will not contravene
the terms of any Loan Party’s Organization Documents and have been duly
authorized by all necessary corporate and, if required, stockholder,
shareholder, member and/or partner action. Subject to the terms of the Final
Order, this Second Amendment and the other instruments, agreements and documents
to which it is a party and executed and delivered in connection herewith have
been duly executed and delivered by the Borrower and each other Loan Party that
is a party hereto and constitute a legal, valid and binding obligation of the
Borrower and each other Loan Party, as applicable, enforceable in accordance
with its terms, subject to applicable Debtor Relief Laws and subject to general
principles of equity, regardless of whether considered in a proceeding in equity
or at Law.

 

D.                 Governmental Approvals; No Conflicts. Subject to the terms of
the Final Order, the execution, delivery and performance of this Second
Amendment and the other instruments, agreements and documents to which it is a
party and executed and delivered in connection herewith (a) do not require any
material consent or approval of, registration or filing with, or any other
action by, any Governmental Authority, except such as have been obtained or made
and are in full force and effect and except for the filing on or about the
Second Amendment Effective Date of one or more current reports on Form 8-K with
respect to this Second Amendment, (b) will not violate any material Law
applicable to the Borrower or any of its Restricted Subsidiaries, (c) except as
could not reasonably be expected to have a Material Adverse Effect, will not
violate or result in a default under any indenture, agreement or other
instrument binding upon the Borrower or any of its Restricted Subsidiaries or
its assets (except those as to which waivers or consents have been obtained),
and (d) will not result in the creation or imposition of any Lien on any asset
of the Borrower or any of its Restricted Subsidiaries, except Liens created
pursuant to the Loan Documents.

 

Section V. Effectiveness. This Second Amendment shall become effective on the
first date (the “Second Amendment Effective Date”) on which the Borrower, the
Administrative Agent and the Consenting Lenders and Consenting Voting
Participants constituting the Required Lenders shall have signed a counterpart
hereof (whether the same or different counterparts) and shall have delivered by
way of “.pdf” via email transmission the same to the Administrative Agent, and
when each of the following conditions are satisfied:

 

A.                 Representations and Warranties. All representations and
warranties contained herein shall be true and correct in all material respects
(or in all respects if the applicable representation or warranty is qualified by
Material Adverse Effect or materiality) on and as of the Second Amendment
Effective Date (both immediately before and after giving effect to the Second
Amendment) (provided that to the extent any such representation or warranty
expressly relates to an expressly relates to an earlier date, such
representation or warranty shall instead b true and correct in all material
respects (or in all respects if the applicable representation or warranty is
qualified by Material Adverse Effect or materiality) and of such earlier date)
(and by its execution hereof, the Borrower shall be deemed to have represented
and warranted such).

 

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B.                  No Default or Event of Default. At the time of, and
immediately before and after giving effect to this Second Amendment, no Default
or Event of Default shall have occurred and be continuing (and by its execution
hereof, the Borrower shall be deemed to have represented and warranted such).

 

The Administrative Agent shall notify the Borrower and the Lenders of the Second
Amendment Effective Date upon the occurrence thereof, and such notice and the
effectiveness of this Second Amendment, the consents provided herein and the
Amended Credit Agreement shall be conclusive and binding upon all of the Lenders
and all of the other parties to the Loan Documents and each of their successors
and assigns; provided that, failure to give any such notice shall not affect the
effectiveness, validity or enforceability of this Amendment, such consents and
the Amended Credit Agreement.

 

Section VI. Confirmation of Guarantees and Security Interest. By signing this
Second Amendment, the Borrower, on behalf of each Loan Party, hereby consents to
the terms of this Second Amendment and confirms that (x) the Obligations of the
Loan Parties under the Credit Agreement, as modified or supplemented hereby, the
Security Agreement, the other Collateral Documents and the other Loan Documents
(i) are entitled to the benefits of the guarantees and the security interests
set forth or created in the Credit Agreement, the Security Agreement, the other
Collateral Documents and the other Loan Documents and (ii) constitute
“Obligations” for purposes of the Credit Agreement, the Security Agreement, the
other Collateral Documents and all other Loan Documents and (y) after giving
effect to the terms hereof, the Credit Agreement (as amended hereby), the
Security Agreement, each other Collateral Document and each other Loan Document
are, and shall continue to be, in full force and effect and are hereby ratified
and confirmed in all respects and the terms of this Second Amendment shall not
affect in any way its obligations and liabilities under any Loan Document
(including, without limitation, the guaranty and any grant of security interests
and pledges pursuant to the Credit Agreement, the Security Agreement and other
Collateral Document or any other Loan Document) to which it is a party (as such
Loan Documents are amended or otherwise expressly modified by this Second
Amendment). The Borrower hereby ratifies and confirms on behalf of each Loan
Party that all Liens granted, conveyed, or assigned to the Administrative Agent
by such Person pursuant to any Collateral Document or any other Loan Document to
which it is a party remain in full force and effect, are not released or
reduced, and continue to secure full payment and performance of the Obligations.

 

Section VII. Reference To and Effect Upon the Loan Documents.

 

A.                 From and after the Second Amendment Effective Date, (i) the
term “Agreement,” in the Amended Credit Agreement, and all references to the
Credit Agreement in any other Loan Document, shall mean the Credit Agreement as
modified hereby and after giving effect to all consents set forth herein, and
(ii) this Second Amendment shall constitute a “Loan Document” for all purposes
of the Amended Credit Agreement and the other Loan Documents.

 

B.                  This Second Amendment is limited as specified herein and
shall not constitute a modification, acceptance or waiver of, or consent to
modifications of or deviations from, any other provision of the Credit
Agreement, any Collateral Document or any other Loan Document or a novation of
existing obligations and liabilities under the Loan Documents (including, for
the avoidance of doubt, other rights in respect of the Sale Motion, the Sale
Process and the underlying sales contemplated therein as set forth in the Loan
Documents). The Credit Agreement, as specifically amended by this Second
Amendment (after giving effect to all consents set forth herein), and each of
the other Loan Documents are and shall continue to be in full force and effect
and are hereby in all respects ratified and confirmed.

 

C.                  The parties hereto agree that, notwithstanding anything to
the contrary set forth in Section 9.23 of the Credit Agreement or the Amended
Credit Agreement (as applicable) or any corresponding provision of any other
Loan Document, to the extent that Section 5.14 of the Amended Credit Agreement
is inconsistent with the Orders as in effect immediately prior to the occurrence
of the Second Amendment Effective Date, Section 5.14 of the Amended Credit
Agreement shall control.

 

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Section VIII. Release; Covenant not to Sue. In consideration of this Second
Amendment and the agreements and waivers of the Administrative Agent and the
Consenting Lenders and Consenting Voting Participants set forth herein, and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the Borrower, on behalf of itself and each of its
Restricted Subsidiaries, and each of their respective successors and assigns
(collectively, as the “Releasing Parties” and each, individually, as a
“Releasing Party”), hereby absolutely, unconditionally and irrevocably releases,
remises and forever discharges the Administrative Agent and each of the
Consenting Lenders and Consenting Voting Participants and their respective
successors and assigns, and their respective present and former shareholders,
affiliates, subsidiaries, divisions, predecessors, directors, officers,
attorneys, employees, agents and other representatives (the Administrative
Agent, each Consenting Lender and Consenting Voting Participant and all such
other Persons being hereinafter referred to collectively as the “Releasees” and
individually as a “Releasee”), of and from all demands, actions, causes of
action, suits, covenants, contracts, controversies, agreements, promises, sums
of money, accounts, bills, reckonings, damages and any and all other claims,
counterclaims, defenses, rights of set off, demands and liabilities whatsoever
of every name and nature now known or unknown, suspected or unsuspected, both at
law and in equity, which any Releasing Party may hold, have or claim to have
against the Releasees or any of them for, upon, or by reason of any
circumstance, action, cause or thing whatsoever, for or on account of, or in
relation to, or in any way in connection with the Second Amendment or the
transactions hereunder, in each case which has arisen at any time on or prior to
the Second Amendment Effective Date; provided that for the avoidance of doubt,
nothing in this Section VIII shall affect continuing obligations of the
Releasees under this Second Amendment, the Amended Credit Agreement and the
other Loan Documents

 

The Borrower confirms, on behalf of itself and each other Releasing Party, that
it and they (i) understand, acknowledge and agree that the releases set forth
above may be pleaded as a full and complete defense and may be used as a basis
for an injunction against any action, suit or other proceeding which may be
instituted, prosecuted or attempted in breach of the provisions of such release
and (ii) agree that no fact, event, circumstance, evidence or transaction which
could now be asserted or which may hereafter be discovered will affect in any
manner the final, absolute and unconditional nature of the release set forth
above.

 

The Borrower, on behalf of itself and each other Releasing Party, hereby
absolutely, unconditionally and irrevocably covenants and agrees with and in
favor of each Releasee that it will not sue (at law, in equity, in any
regulatory proceeding or otherwise) any Releasee on the basis of any Claim
released, remised and discharged by any Releasing Party pursuant to this Section
VIII.

 

Section IX. Legal Expenses. The Borrower hereby agrees to pay all reasonable
fees and out of pocket expenses of counsel to the Administrative Agent incurred
by the Administrative Agent in connection with the preparation, negotiation and
execution of this Second Amendment and any other instruments and documents
executed and delivered in connection herewith. The Borrower hereby reaffirms in
all respects its obligations set forth in Section 9.03 of the Credit Agreement
and the Amended Credit Agreement and any corresponding provision contained in
any Loan Documents, in each case, in accordance with the terms thereof.

 

Section X. Counterparts, Etc. This Second Amendment may be executed in any
number of counterparts, each of which when so executed shall be deemed an
original, but all such counterparts shall constitute one and the same
instrument, and all signatures need not appear on any one counterpart. Any party
hereto may execute and deliver a counterpart of this Second Amendment by
delivering by facsimile or other electronic transmission a signature page of
this Second Amendment signed by such party, and any such facsimile or other
electronic signature shall be treated in all respects as having the same effect
as an original signature. Section headings in this Second Amendment are included
herein for convenience of reference only and shall not constitute part of this
Second Amendment for any other purpose. A complete set of counterparts of this
Second Amendment shall be lodged with the Borrower and the Administrative Agent.

 

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Section XI. Governing Law. This Second Amendment and any claims, controversy,
dispute or cause of action (whether in contract or tort or otherwise) based
upon, arising out of or relating to this Second Amendment and the transactions
contemplated hereby shall be governed by, and construed and interpreted in
accordance with, the Law of the State of New York and, to the extent applicable,
the Bankruptcy Code.

 

Section XII. Headings. The headings, captions and arrangements used in this
Second Amendment are, unless specified otherwise, for convenience only and shall
not be deemed to limit, amplify or modify the terms of this Second Amendment,
nor affect the meaning thereof.

 

[Signature Pages to follow]

 

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IN WITNESS WHEREOF, the parties hereto have caused their duly authorized
officers to execute and deliver this Second Amendment as of the date first above
written.

 

BORROWER: DEAN FOODS COMPANY, as the Borrower             By: /s/ Kristy N.
Waterman     Name:  Kristy N. Waterman     Title: Senior Vice President, General
    Counsel and Corporate Secretary

 

Signature Page to Second Amendment to Dean Foods DIP Credit Agreement

 

 

Strictly Private & Confidential

Subject to FRE 408 and its equivalents

 

ADMINISTRATIVE AGENT: COÖPERATIEVE RABOBANK U.A., NEW YORK BRANCH, an
Administrative Agent         By: /s/ Dusan Lazarov     Name: Dusan Lazarov    
Title: Manager Director         By: /s/ Stephanie La Barbara     Name: Stephanie
La Barbara     Title: VP

 

Signature Page to Second Amendment to Dean Foods DIP Credit Agreement

 

 

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LENDERS: COÖPERATIEVE RABOBANK U.A., NEW YORK BRANCH, as a Lender         By:
/s/ Dusan Lazarov     Name: Dusan Lazarov     Title: Manager Director        
By: /s/ Stephanie La Barbara     Name: Stephanie La Barbara     Title: VP

  

Signature Page to Second Amendment to Dean Foods DIP Credit Agreement

 

 

Strictly Private & Confidential

Subject to FRE 408 and its equivalents

 

  ACF FinCo I LLP, as a Lender         By: /s/ Oleh Szczupak     Name: Oleh
Szczupak     Title: Authorized Signor

 

Signature Page to Second Amendment to Dean Foods DIP Credit Agreement

 

 

Strictly Private & Confidential

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  ING CAPITAL LLC, as a Lender         By: /s/ Daniel W. Lamprecht     Name:
Daniel W. Lamprecht     Title: Managing Director         By: /s/ Gonzalo Sanchez
    Name: Gonzalo Sanchez     Title: Director

 

Signature Page to Second Amendment to Dean Foods DIP Credit Agreement

 

 

Strictly Private & Confidential

Subject to FRE 408 and its equivalents

 

  BMO Harris Bank N.A., as a Lender         By: /s/ Sarah Yates     Name: Sarah
Yates     Title: Managing Director

  

Signature Page to Second Amendment to Dean Foods DIP Credit Agreement

 

 

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  CTI Northbridge Credit, as a Lender         By: /s/ Barbara J. Coffin    
Name: Barbara J. Coffin     Title: Authorized Signatory

  

Signature Page to Second Amendment to Dean Foods DIP Credit Agreement

 

 

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  COBANK, ACB, as a Lender         By: /s/ Wayne P. Graffis     Name: Wayne P.
Graffis     Title: Vice President

 

Signature Page to Second Amendment to Dean Foods DIP Credit Agreement

 

 

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  American AgCredit, FLCA, as a Voting Participant         By: /s/ Chris M.
Levine     Name: Chris M. Levine     Title: Vice President

  

Signature Page to Second Amendment to Dean Foods DIP Credit Agreement

 

 

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  Farm Credit Mid-America, PCA as a Voting Participant         By: /s/ Patrick
Sauer     Name: Patrick Sauer     Title: President Food & Agribusiness

  

Signature Page to Second Amendment to Dean Foods DIP Credit Agreement

 

 

Strictly Private & Confidential

Subject to FRE 408 and its equivalents

 

  Compeer Financial, FLCA, as a Voting Participant         By: /s/ Kevin Buente
    Name: Kevin Buente     Title: Principal Credit Officer

  

Signature Page to Second Amendment to Dean Foods DIP Credit Agreement

 

 

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Subject to FRE 408 and its equivalents

 

  YOSEMITE LAND BANK, FLCA, as a Voting Participant         By: /s/ Steven M.
Mizuno     Name: Steven M. Mizuno     Title: SVP

 

Signature Page to Second Amendment to Dean Foods DIP Credit Agreement

 

 

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  Farm Credit Bank of Texas, as a Voting Participant         By: /s/ Luis M. H.
Requejo     Name: Luis M. H. Requejo     Title: Director Capital Markets

 

Signature Page to Second Amendment to Dean Foods DIP Credit Agreement

 

 

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  Northwest Farm Credit Services, FLCA, as a Voting Participant         By: /s/
Jeremy VanderVegt     Name: Jeremy VanderVegt     Title: Vice President

  

Signature Page to Second Amendment to Dean Foods DIP Credit Agreement

 

 

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  GreenStone Farm Credit Services, FLCA, as a Voting Participant         By: /s/
Kyle Hernandez     Name: Kyle Hernandez     Title: Lending Officer

  

Signature Page to Second Amendment to Dean Foods DIP Credit Agreement

 

 

Strictly Private & Confidential

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  AgCountry Farm Credit Services, FLCA, as a Voting Participant         By: /s/
Warren Shoen     Name: Warren Shoen     Title: Senior Vice President

 

Signature Page to Second Amendment to Dean Foods DIP Credit Agreement

 

 

EXHIBIT A

 

Amended Bid Procedures Order

 

(See Attached)

 

 

 

IN THE UNITED STATES BANKRUPTCY COURT

FOR THE SOUTHERN DISTRICT OF TEXAS

HOUSTON DIVISION

 

_________________________________________  

 

In re:

 

SouthERN FOODS GROUPS, LLC, et al.,

 

Debtors.1

)

)

)

)

)

)

)

 

Chapter 11

 

Case No. 19-36313 (DRJ)

 

Jointly Administered

_________________________________________ )

 

         

ORDER (I) APPROVING BIDDING PROCEDURES FOR SALE OF DEBTORS’ ASSETS, (II)
SCHEDULING HEARING TO APPROVE SALE OF DEBTORS’ ASSETS, (III) APPROVING FORM AND
MANNER OF NOTICES OF SALE AND SALE HEARING, (IV) APPROVING ASSUMPTION AND
ASSIGNMENT PROCEDURES, AND (V) GRANTING RELATED RELIEF

[Relates to Dkt. No. 925]

______________________________________________________________________________

Upon the motion (the “Motion”)2 of Southern Foods Group, LLC, Dean Foods
Company, and their debtor affiliates (collectively, the “Debtors”) in the
above-captioned chapter 11 cases (the “Chapter 11 Cases”) for entry of an order,
pursuant to sections 105(a), 363, 365, 503, and 507 of the Bankruptcy Code,
Bankruptcy Rules 2002, 6004, 6006, 9007, and 9014, (I)(a) approving Bidding
Procedures for the sale of the Debtors’ assets, (b) scheduling a hearing to
approve the sale of the Debtors’ assets, (c) approving the Noticing Procedures,
(d) approving the Assumption and Assignment Procedures, and (e) granting related
relief, and (II)(a) approving the sale of the Debtors’ assets free and clear of
liens, claims, interests, and encumbrances, (b) authorizing the assumption and
assignment of certain Contracts and Leases, and (c) granting related relief, in
each case, as more fully described in the Motion; and the Court having
jurisdiction to consider the matters raised in the Motion pursuant to 28 U.S.C.
§ 1334 and the Order of Reference to Bankruptcy Judges, General Order 2012-6
(S.D. Tex. May 24, 2012) (Hinojosa, C.J.); and the Court having found that this
is a core proceeding pursuant to 28 U.S.C. § 157; and the Court having found
that it may enter a final order consistent with Article III of the United States
Constitution; and the Court having found that venue of this proceeding and the
Motion in this District is proper pursuant to 28 U.S.C. §§ 1408 and 1409; and
due, proper, and adequate notice of the Motion under Bankruptcy Rule 6004(a) and
opportunity for a hearing on the Motion having been given to the parties listed
therein, and it appearing that no other or further notice need be provided; and
the Court having reviewed and considered the Motion and the Magro Declaration;
and the Court having held a hearing on the Motion, as it pertains to the Bidding
Procedures (the “Bidding Procedures Hearing”); and the Court having determined
that the relief granted herein is in the best interests of the Debtors, their
creditors, their estates, and all other parties in interest; and upon all of the
proceedings had before the Court; and after due deliberation and sufficient
cause appearing therefor,

 

 

1The debtors and debtors in possession in these chapter 11 cases, along with the
last four digits of their respective Employer Identification Numbers, are as
follows: Southern Foods Group, LLC (1364); Dean Foods Company (9681); Alta-Dena
Certified Dairy, LLC (1347); Berkeley Farms, LLC (8965); Cascade Equity Realty,
LLC (3940); Country Fresh, LLC (6303); Dairy Information Systems Holdings, LLC
(9144); Dairy Information Systems, LLC (0009); Dean Dairy Holdings, LLC (9188);
Dean East II, LLC (9192); Dean East, LLC (8751); Dean Foods North Central, LLC
(7858); Dean Foods of Wisconsin, LLC (2504); Dean Holding Company (8390); Dean
Intellectual Property Services II, Inc. (3512); Dean International Holding
Company (9785); Dean Management, LLC (7782); Dean Puerto Rico Holdings, LLC
(6832); Dean Services, LLC (2168); Dean Transportation, Inc. (8896); Dean West
II, LLC (9190); Dean West, LLC (8753); DFC Aviation Services, LLC (1600); DFC
Energy Partners, LLC (3889); DFC Ventures, LLC (4213); DGI Ventures, Inc.
(6766); DIPS Limited Partner II (7167); Franklin Holdings, Inc. (8114); Fresh
Dairy Delivery, LLC (2314); Friendly’s Ice Cream Holdings Corp. (7609);
Friendly’s Manufacturing and Retail, LLC (9828); Garelick Farms, LLC (3221);
Mayfield Dairy Farms, LLC (3008); Midwest Ice Cream Company, LLC (0130); Model
Dairy, LLC (7981); Reiter Dairy, LLC (3675); Sampson Ventures, LLC (7714);
Shenandoah’s Pride, LLC (2858); Steve’s Ice Cream, LLC (6807); Suiza Dairy
Group, LLC (2039); Tuscan/Lehigh Dairies, Inc. (6774); Uncle Matt’s Organic,
Inc. (0079); and Verifine Dairy Products of Sheboygan, LLC (7200). The debtors’
mailing address is 2711 North Haskell Avenue, Suite 3400, Dallas, TX 75204.

 

2Capitalized terms used but not otherwise defined herein shall have the meanings
ascribed to them in the Bidding Procedures (as defined herein) or the Motion, as
applicable.

 

 

Strictly Private & Confidential

Subject to FRE 408 and its equivalents

 

IT IS HEREBY FOUND AND DETERMINED THAT:

 

A.                 The findings and conclusions set forth herein constitute the
Court’s findings of fact and conclusions of law pursuant to Bankruptcy Rule
7052, made applicable to this proceeding pursuant to Bankruptcy Rule 9014. To
the extent that any of the following findings of fact constitute conclusions of
law, and to the extent that any of the following conclusions of law constitute
findings of fact, they are adopted as such.

 

B.                  The Debtors’ proposed notice of the Motion, the Bidding
Procedures, the Assumption and Assignment Procedures, the Noticing Procedures,
the Bidding Procedures Hearing, and the proposed entry of the Bidding Procedures
Order is (i) appropriate and reasonably calculated to provide all interested
parties with timely and proper notice, (ii) in compliance with all applicable
requirements of the Bankruptcy Code, the Bankruptcy Rules, and the Local Rules,
and (iii) adequate and sufficient under the circumstances of the Chapter 11
Cases, and no other or further notice is required. A reasonable opportunity to
object or be heard regarding the relief requested in the Motion, as it pertains
to the Bidding Procedures, has been afforded to all interested persons and
entities, including, but not limited to, the Notice Parties.

 

 2 

Strictly Private & Confidential

Subject to FRE 408 and its equivalents

 

C.                  The Bidding Procedures in the form attached hereto are fair,
reasonable, and appropriate, are designed to maximize recoveries from a sale of
the Bid Assets, and permit the Debtors to comply with their obligations under
the DIP Credit Agreement and DIP Order (as each is defined in the Motion).

 

D.                 The Debtors have demonstrated a compelling and sound business
justification for the Court to enter this Order and, thereby, (i) approve the
Bidding Procedures, (ii) set the dates of the Bid Deadline, Sale Hearing, and
other deadlines set forth in the Bidding Procedures attached hereto,
(iii) approve the Noticing Procedures and the forms of notice, and (iv) approve
the Assumption and Assignment Procedures and the forms of relevant notice;
provided that this finding shall not prohibit parties in interest from seeking
further extensions of the Bid Deadline, Sale Hearing, and other deadlines set
forth in the Bidding Procedures for cause shown pursuant to Paragraph 3 of this
Order. Such compelling and sound business justification, which was set forth on
the record at the Bidding Procedures Hearing, is incorporated herein by
reference and, among other things, forms the basis for the findings of fact and
conclusions of law set forth herein.

 

E.                  Entry of this Order is in the best interests of the Debtors
and their estates, creditors, interest holders, and all other parties in
interest herein.

 

F.                  The form and manner of notice to be delivered pursuant to
the Noticing Procedures and the Assumption and Assignment Procedures (including
the Sale Notice attached hereto, the Potential Assumption and Assignment Notice
attached hereto, and the Proposed Assumption and Assignment Notice attached
hereto) are reasonably calculated to provide each Counterparty to the Potential
Assumed Contracts and the Proposed Assumed Contracts with proper notice of (i)
the potential assumption and assignment of such Potential Assumed Contracts and
Proposed Assumed Contracts by the Successful Bidder(s) or any of their known
proposed assignees (if different from the Successful Bidder) and (ii) the
requirement that each such Counterparty assert any objection to the proposed
Cure Costs by the Cure Objection Deadline or otherwise be barred from asserting
claims arising from events occurring prior to the effective date of the
assumption and assignment of such Proposed Assumed Contracts or any later
applicable effective date following assumption and assignment of such Proposed
Assumed Contracts.

 

 3 

Strictly Private & Confidential

Subject to FRE 408 and its equivalents

 

ORDERED, ADJUDGED, AND DECREED THAT:

 

1.                   The Bidding Procedures, in the form attached hereto, are
approved and fully incorporated into this Order and the Debtors are authorized,
but not directed, to act in accordance therewith. The failure to specifically
include a reference to any particular provision of the Bidding Procedures in
this Order shall not diminish or impair the effectiveness of such provision. In
the event of any conflict between the Bidding Procedures and this Order, this
Order shall control.

 

2.                   Nothing herein shall prejudice the rights of the Debtors to
seek by separate motion, in the exercise of their sound business judgment and
fiduciary duties, in consultation with the Consultation Parties, the authority
to sell assets of the Debtors’ estates pursuant to section 363 of the Bankruptcy
Code.

 

3.                   Bid Deadline. As further described in the Bidding
Procedures, the Bid Deadline shall be at 12:00 p.m. (prevailing Central Time) on
March 30, 2020; provided, however, that the Court may extend the Bid Deadline
upon request by a party in interest and for cause shown, and all parties’ rights
are reserved in connection with any such request.

 

4.                   The form of Sale Notice attached hereto is hereby approved.

 

5.                   As soon as reasonably practicable after entry of this
Order, the Debtors shall serve the Sale Notice by first class or overnight mail
upon the following: (a) the U.S. Trustee; (b) Akin Gump Strauss Hauer & Feld
LLP, as counsel to the Committee; (c) White & Case LLP, as counsel to the
Agents; (d) indenture trustee under the Debtors’ prepetition unsecured bond
indenture; (e) Counterparties to Contracts and Leases; (f) the Securities and
Exchange Commission; (g) the Internal Revenue Service; (h) the U.S.
Environmental Protection Agency; (i) the United States Attorney’s Office for the
Southern District of Texas; (j) the United States Attorney General/Antitrust
Division of the Department of Justice; (k) the state attorneys general for
states in which the Debtors conduct business; (l) all other parties asserting a
security interest in the assets of the Debtors to the extent reasonably known to
the Debtors; (m) all potential buyers previously identified or solicited by the
Debtors or their advisors and any additional parties who have previously
expressed an interest to the Debtors or their advisors in potentially acquiring
the Debtors’ assets; (n) all other known parties with any interest in the Bid
Assets; (o) all known creditors of the Debtors; and (p) any party that has
requested notice pursuant to Bankruptcy Rule 2002 (collectively, the “Sale
Notice Parties”). The Debtors will publish the Sale Notice once in USA Today
national edition within three business days following entry of the Bidding
Procedures Order.

 

 4 

Strictly Private & Confidential

Subject to FRE 408 and its equivalents

 

6.                   Service of the Sale Notice on the Sale Notice Parties in
the manner described in this Order constitutes good and sufficient notice of the
Sale Hearing. No other or further notice is required.

 

7.                   Absent further order or direction of the Court, by no later
than March 30, 2020 at 11:59 p.m. (prevailing Central Time), the Debtors shall
file copies of the following: (a) all bids received by the Bid Deadline; (b) a
notice designating (after consultation with the Consultation Parties) the
Successful Bidder(s) and Alternate Bidders(s) for the Bid Assets (the “Notice of
Bid Results”); provided that the Debtors may determine not to designate
Successful Bidders and Alternate Bidders with respect to a minority of the Bid
Assets if they believe, in consultation with the Consultation Parties, that
extending the sale process with respect to such Bid Assets would be reasonably
likely to maximize value for the benefit of the Debtors’ estates; and (c) final
form(s) of order(s) approving the Sale Transaction(s) as agreed upon between the
Debtors (in consultation with the Consultation Parties) and the Successful
Bidder(s).

 

8.                   Sale Objections. Objections to the relief sought in the
Sale Order(s) or the Sale Transaction(s) must (a) be in writing, (b) comply with
the Bankruptcy Code, Bankruptcy Rules, and Local Rules, (c) state, with
specificity, the legal and factual bases thereof, (d) be filed with the Court no
later than 12:00 p.m. (prevailing Central Time) on April 1, 2020, and (e) be
served on (i) counsel to the Debtors, (y) Davis Polk & Wardwell LLP, 450
Lexington Avenue, New York, New York 10017, Attn: Brian M. Resnick, Steven Z.
Szanzer, and Nate Sokol and (z) Norton Rose Fulbright US LLP, 1301 McKinney
Street, Suite 5100, Houston, Texas 77010, Attn: William Greendyke, Jason L.
Boland, Robert B. Bruner, and Julie Harrison, (ii) (y) counsel to the Agents,
White & Case LLP, 1221 Avenue of the Americas, New York, NY 10020, Attn: Scott
Greissman, Philip Abelson, and Elizabeth Feld and (z) Gray Reed, 1300 Post Oak
Blvd, Suite 2000, Houston, TX 77056, Attn: Jason S. Brookner, (iii) counsel to
the Committee, Akin Gump Strauss Hauer & Feld LLP, One Bryant Park, New York, NY
10036, Attn: Philip Dublin and Meredith Lahaie, and (iv) the U.S. Trustee
(collectively, the “Objection Notice Parties”). If a timely objection is filed
and served in accordance with this paragraph, the terms of any Sale Transaction
shall not be approved until the objection is resolved either consensually or by
order of the Court.

 

 5 

Strictly Private & Confidential

Subject to FRE 408 and its equivalents

 

9.                   Sale Hearing. The Sale Hearing shall be held in the United
States Bankruptcy Court for the Southern District of Texas, Houston, Texas
77002, on April 3, 2020 at 9:00 a.m. (prevailing Central Time) or such other
date and time that the Court may later direct; provided, however, that the Sale
Hearing may be adjourned by the Debtors (in consultation with the Consultation
Parties) by announcement of the adjournment in open court or on the Court’s
docket.

 

10.               Assumption and Assignment Procedures. The assumption and
assignment procedures set forth in the Motion (the “Assumption and Assignment
Procedures”) are hereby approved.

 

11.               As soon as reasonably practicable following entry of this
Order, the Debtors shall file with the Court, and cause to be published on the
Case Information Website, the Potential Assumption and Assignment Notice and a
list of the Potential Assumed Contracts (the “Potential Assumed Contracts
Schedule”) that specifies (a) each of the Contracts and Leases that potentially
could be assumed and assigned in connection with the sale of the Bid Assets,
including the name of each Counterparty and (b) the proposed Cure Cost with
respect to each Potential Assumed Contract.

 

12.               Potential Assumption and Assignment Notice. The Debtors shall,
as soon as reasonably practicable after entry of this Order (but in any event,
so as to provide sufficient notice such that any required responses from any
Counterparties are due prior to the Assumption and Assignment Objection Deadline
(as defined herein)), file and serve on each relevant Counterparty the Potential
Assumption and Assignment Notice, which shall (a) identify the Potential Assumed
Contracts, (b) list the Debtors’ good faith calculation of the Cure Costs as of
the date hereof with respect to the Potential Assumed Contracts identified on
the Potential Assumption and Assignment Notice, (c) expressly state that
assumption or assignment of an Assumed Contract or Assumed Lease is not
guaranteed and is subject to Court approval, (d) prominently display the
Assumption and Assignment Objection Deadline, and (e) prominently display the
date, time, and location of the Sale Hearing. The Debtors shall serve on all
parties requesting notice pursuant to Bankruptcy Rule 2002, via first class
mail, a modified version of the Potential Assumption and Assignment Notice,
without the Potential Assumed Contracts Schedule, which will include
instructions regarding how to view the Potential Assumed Contracts Schedule on
the Case Information Website.

 

 6 

Strictly Private & Confidential

Subject to FRE 408 and its equivalents

 

13.               Proposed Assumption and Assignment Notice. The Debtors shall,
in conjunction with the filing of the Notice of Bid Results, file and serve on
each relevant Counterparty the Proposed Assumption and Assignment Notice, which
shall (a) identify the Proposed Assumed Contracts, (b) expressly state that
assumption or assignment of an Assumed Contract or Assumed Lease is not
guaranteed and is subject to Court approval, (c) prominently display the
Assumption and Assignment Objection Deadline, and (d) prominently display the
date, time, and location of the Sale Hearing. The Debtors shall serve on all
parties requesting notice pursuant to Bankruptcy Rule 2002, via first class
mail, a modified version of the Proposed Assumption and Assignment Notice,
without the schedule of Proposed Assumed Contracts (the “Proposed Assumed
Contracts Schedule”), which will include instructions regarding how to view the
Proposed Assumed Contracts Schedule on the Case Information Website.

 

14.               Objection Deadlines. Any Counterparty may object to the
potential or proposed assumption or assignment of its Assumed Contract or
Assumed Lease, the Debtors’ proposed Cure Costs, if any, or the ability of the
Successful Bidder(s) to provide adequate assurance of future performance (an
“Assumption and Assignment Objection”). All Assumption and Assignment Objections
must (a) be in writing, (b) comply with the Bankruptcy Code, Bankruptcy Rules,
and Local Rules, (c) state, with specificity, the legal and factual bases
thereof, including, if applicable, the Cure Costs the Counterparty believes is
required to cure defaults under the relevant Assumed Contract or Assumed Lease,
and (d) be filed with the Court and served on the Objection Notice Parties by no
later than April 1, 2020 at 12:00 p.m. (prevailing Central Time) (the
“Assumption and Assignment Objection Deadline”).

 

15.               Resolution of Assumption and Assignment Objections. If a
Counterparty files a timely Assumption and Assignment Objection, such objection
shall be heard at the Sale Hearing or such later date that the Debtors determine
in consultation with the Successful Bidder(s), the Consultation Parties, the
Counterparty, and subject to the Court’s calendar. If such objection has not
been resolved prior to the closing of the Sale Transaction (whether by an order
of the Court or by agreement with the Counterparty), each Successful Bidder may
elect, in its sole and absolute discretion, one of the following options: (a)
treat such Counterparty’s contract or lease as property excluded from the Bid
Assets (an “Excluded Contract” or “Excluded Lease”, respectively); or (b)
temporarily treat the Proposed Assumed Contract as an Excluded Contract or
Excluded Lease, as applicable (a “Designated Agreement”), proceed to the closing
of the Sale Transaction with respect to all other Bid Assets, and determine
whether to treat the Designated Agreement as an Assumed Contract or Assumed
Lease, as applicable, or an Excluded Contract or Excluded Lease, as applicable,
within ten business days after resolution of such objection (whether by order of
the Court or by agreement of the Successful Bidder(s), the Counterparty, and the
Debtors).

 

 7 

Strictly Private & Confidential

Subject to FRE 408 and its equivalents

 

16.               Failure To File Timely Assumption and Assignment Objection. If
a Counterparty fails to file with the Court and serve on the Objection Notice
Parties a timely Assumption and Assignment Objection, the Counterparty shall be
forever barred from asserting any such objection with regard to the assumption
or assignment of its Assumed Contract or Assumed Lease. Notwithstanding anything
to the contrary in the Assumed Contract or Assumed Lease, or any other document,
the Cure Costs set forth in the Potential Assumption and Assignment Notice or
the Supplemental Assumption and Assignment Notice (as defined below) shall be
controlling and will be the only amount necessary to cure outstanding defaults
under the applicable Assumed Contract or Assumed Lease under section 365(b) of
the Bankruptcy Code arising out of or related to any events occurring prior to
the closing of the Sale Transaction or other applicable date upon which such
assumption and assignment will become effective, whether known or unknown, due
or to become due, accrued, absolute, contingent, or otherwise, and the
Counterparty shall be forever barred from asserting any additional cure or other
amounts with respect to such Assumed Contract or Assumed Lease against the
Debtors, the Successful Bidder(s), or the property of any of them.

 

17.               Modification of Potential Assumed Contracts Schedule or
Proposed Assumed Contracts Schedule. In addition to a Successful Bidder’s rights
described above with respect to an Assumption and Assignment Objection, at or
prior to the closing of the Sale Transaction, the Successful Bidder(s) may
elect, in its or their respective sole and absolute discretion, to (a) exclude
any contract or lease on the Potential Assumed Contracts Schedule as an Assumed
Contract or Assumed Lease, as applicable (in which case it shall become an
Excluded Contract or Excluded Lease, as applicable), provided that such
exclusions will not reduce the purchase price to be paid by the Successful
Bidder, or (b) include on the Proposed Assumed Contracts Schedule any contract
or lease listed on the Potential Assumed Contracts Schedule, so long as the
Successful Bidder is paying the Cure Costs therefor, by providing to the Debtors
written notice of its election to exclude or include such contract or lease, as
applicable.

 

 8 

Strictly Private & Confidential

Subject to FRE 408 and its equivalents

 

18.               If the Debtors or any Successful Bidder identifies during the
pendency of the Chapter 11 Cases (before the closing of the Sale Transaction)
any contract or lease that is not listed on the Proposed Assumed Contracts
Schedule, and such contract or lease has not been rejected by the Debtors, each
Successful Bidder may in its sole and absolute discretion elect by written
notice to the Debtors to treat such contract or lease as an Assumed Contract or
Assumed Lease, as applicable, so long as the Successful Bidder is paying the
Cure Costs therefor, and the Debtors shall seek to assume and assign such
Assumed Contract or Assumed Lease in accordance with the Assumption and
Assignment Procedures.

 

19.               Following the selection of the Successful Bidder(s), the
Debtors reserve the right, at any time before the closing of the Sale
Transaction(s), to modify the previously-stated Cure Costs associated with any
Proposed Assumed Contract, subject to notice requirements in the Assumption and
Assignment Procedures.

 

20.               In the event that any contract or lease is added to the
Potential Assumed Contracts Schedule or Proposed Assumed Contracts Schedule, or
previously-stated Cure Costs are modified, in accordance with the Assumption and
Assignment Procedures, the Debtors will promptly serve a supplemental assumption
and assignment notice, by first class mail, on the applicable Counterparty
(each, a “Supplemental Assumption and Assignment Notice”), and otherwise timely
notify the Consultation Parties. Each Supplemental Assumption and Assignment
Notice will include the same information with respect to the applicable Assumed
Contract or Assumed Lease as is required to be included in the Potential
Assumption and Assignment Notice.

 

 9 

Strictly Private & Confidential

Subject to FRE 408 and its equivalents

 

21.               Any Counterparty listed on a Supplemental Assumption and
Assignment Notice whose contract or lease is proposed to be assumed and assigned
may object to the proposed assumption or assignment of its Assumed Contract or
Assumed Lease, the Debtors’ proposed Cure Costs (to the extent modified from the
previously-stated amount), or the ability of the Successful Bidder(s) to provide
adequate assurance of future performance (a “Supplemental Assumption and
Assignment Objection”). All Supplemental Assumption and Assignment Objections
must (a) be in writing, (b) comply with the Bankruptcy Code, Bankruptcy Rules,
and Local Rules, (c) state, with specificity, the legal and factual bases
thereof, including, if applicable, the Cure Costs the Counterparty believes is
required to cure defaults under the relevant Assumed Contract or Assumed Lease,
and (d) no later than 14 days from the date of service of such Supplemental
Assumption and Assignment Notice, (i) be filed with the Court and (ii) be served
on the Objection Notice Parties. Each Supplemental Assumption and Assignment
Objection, if any, shall be resolved in the same manner as an Assumption and
Assignment Objection.

 

22.               Reservation of Rights. The inclusion of an Assumed Contract,
Assumed Lease, or Cure Costs with respect thereto on a Potential Assumption and
Assignment Notice, a Proposed Assumption and Assignment Notice, the Potential
Assumed Contracts Schedule, the Proposed Assumed Contracts Schedule, or a
Supplemental Assumption and Assignment Notice shall not constitute or be deemed
a determination or admission by the Debtors, the Successful Bidder(s), or any
other party in interest that such contract or lease is an executory contract or
unexpired lease within the meaning of the Bankruptcy Code. The Debtors reserve
all of their rights, claims, and causes of action with respect to each Assumed
Contract and Assumed Lease listed on a Potential Assumption and Assignment
Notice, Proposed Assumption and Assignment Notice, Supplemental Assumption and
Assignment Notice, the Potential Assumed Contracts Schedule, and the Proposed
Assumed Contracts Schedule. The Debtors’ inclusion of any Assumed Contract or
Assumed Lease on the Potential Assumption and Assignment Notice, Proposed
Assumption and Assignment Notice, Supplemental Assumption and Assignment Notice,
Potential Assumed Contracts Schedule, and/or Proposed Assumed Contracts Schedule
shall not be a guarantee that such Assumed Contract or Assumed Lease ultimately
will be assumed or assumed and assigned.

 

 10 

Strictly Private & Confidential

Subject to FRE 408 and its equivalents

 

23.               The Debtors are authorized to take all such actions as are
necessary or appropriate to implement the terms of this Order.

 

24.               This Order shall be binding on the Debtors, including any
chapter 7 or chapter 11 trustee or other fiduciary appointed for the estates of
the Debtors.

 

25.               Any Bankruptcy Rule (including, but not limited to, Bankruptcy
Rule 6004(a), 6004(h), 6006(d), or 9014) or Local Rule that might otherwise
delay the effectiveness of this Order is hereby waived, and the terms and
conditions of this Order shall be effective and enforceable immediately upon its
entry.

 

26.               All time periods set forth in this Order shall be calculated
in accordance with Bankruptcy Rule 9006(a).

 

27.               To the extent any provisions of this Order shall be
inconsistent with the Motion, the terms of this Order shall control.

 

28.               Notwithstanding anything to the contrary herein, nothing in
this Order is intended to or shall restrict, modify, or impair the rights of (a)
the DIP Secured Parties and/or the Prepetition Secured Parties under the DIP
Order, the DIP Documents (as defined in the DIP Order), or the Prepetition Loan
Documents (as defined in the DIP Order), or (b) the Secured Parties under (and
as defined in) the Securitization Order and the Securitization Documents.

 

29.               The Court shall retain exclusive jurisdiction to hear and
determine all matters arising from or relating to the implementation,
interpretation, or enforcement of this Order.

 

Signed: March 19, 2020     /s/ David R. Jones   DAVID R. JONES   UNITED STATES
BANKRUPTCY JUDGE

 

 11 

 

Bidding Procedures

 

 

 

BIDDING PROCEDURES1

 

The bidding procedures set forth below (these “Bidding Procedures”) detail the
process by which Dean Foods Company (“Dean Foods”) and its affiliated debtors
(collectively with Dean Foods, the “Debtors”) are authorized by the United
States Bankruptcy Court for the Southern District of Texas
(the “Bankruptcy Court”) to conduct a sale of all, substantially all, or any
combination of the Debtors’ assets in one or more lots (collectively,
the “Bid Assets”).2 A party may participate in the bidding process by submitting
a bid for (a) all or substantially all of the Bid Assets and/or (b) one or more,
or any combination of, Bid Assets as that party may desire. These Bidding
Procedures also provide that the Debtors, in consultation with the Consultation
Parties (as defined herein), may also consider competing bids in the form of a
chapter 11 plan of reorganization, subject to the requirements set forth herein
(a “Chapter 11 Plan Bid”).

 

The Debtors, in consultation with the Consultation Parties, shall determine the
highest or otherwise best offer(s) for the sale(s) of one or more categories of
the Bid Assets, or any other combination thereof, based upon the Qualified Bids
filed by the Bid Deadline.

 

Any interested bidder should contact, as soon as practicable:

 

EVERCORE GROUP L.L.C.3

55 East 52nd Street

New York, NY 10055

Attn.: John Kimm

john.kimm@evercore.com

(tel.) +1 (212) 849-3436

 

These Bidding Procedures describe, among other things, (i) the Bid Assets
offered for sale, (ii) the manner in which bidders may submit Qualified Bids (as
defined below), (iii) the selection of the Successful Bidder(s) (as defined
below), and (iv) the approval by the Bankruptcy Court of the sale of the Bid
Assets to the Successful Bidder(s).

 

Throughout the sale process, the Debtors and their advisors will regularly and
timely consult with the following parties (collectively, the “Consultation
Parties”): Coöperatieve Rabobank U.A., as agent, and its advisors (including
White & Case LLP and FTI Consulting), and the Committee and its advisors,
including Akin Gump Strauss Hauer & Feld LLP.

 

1.Participation Requirements

 

Unless otherwise ordered by the Bankruptcy Court for cause shown, to participate
in the bidding process described herein (the “Bidding Process”), each interested
person or entity (each, an “Interested Party”) seeking access to the Debtors’
confidential electronic data room concerning the Bid Assets (the “Data Room”)
must deliver an executed confidentiality agreement in form and substance
satisfactory to the Debtors (in consultation with the Consultation Parties) to
Evercore. Upon the receipt of the executed confidentiality agreement, the
Debtors will deliver to such Interested Party access to the Data Room, which
shall include an electronic copies of forms of asset purchase agreement (for all
assets and for select assets) and a form of Sale Order (as defined below).

 

 

1To the extent the Bidding Procedures require the Debtors to consult with the
Consultation Parties in connection with making a determination or taking any
action, the Debtors shall do so in a regular and timely manner prior to making
such determination or taking such action. For the avoidance of doubt, unless
approved by the Bankruptcy Court, no amendment or other modification to these
Bidding Procedures shall be made by the Debtors without the consent of the
Consultation Parties.

 

2These bidding procedures were approved by the Bankruptcy Court on [·], 2020
[D.I. [·]] (the “Bidding Procedures Order”). Capitalized terms used but not
defined herein shall have the meanings ascribed to such terms in the Bidding
Procedures Order or the DIP Order (as defined below), as applicable.

 

3Evercore Group, L.L.C., in its capacity as financial advisor the Debtors, is
referred to herein as “Evercore.”

 

 

 

Until the Bid Deadline, in addition to granting access to the Data Room, the
Debtors will provide Interested Parties with due diligence access and additional
information, as may be requested by an Interested Party, to the extent that the
Debtors determine, in consultation with the Consultation Parties, that such
requests are reasonable and appropriate under the circumstances. All due
diligence requests shall be directed to Evercore. The Debtors, with the
assistance of Evercore, will coordinate all reasonable requests for additional
information and due diligence access from Interested Parties.

 

Unless otherwise determined by the Debtors, the availability of due diligence to
an Interested Party will cease if (i) the Interested Party does not become a
Qualified Bidder or (ii) the Bidding Process is terminated in accordance with
its terms.

 

2.Qualified Bids

 

Each offer, solicitation, or proposal by an Interested Party must satisfy each
of the following conditions in order for such offer, solicitation, or proposal
to be deemed a “Qualified Bid” and for such Interested Party to be deemed
a “Qualified Bidder,” unless any such conditions that are not satisfied are
waived by the Debtors in consultation with the Consultation Parties:

 

(a)Bid Deadline

 

An Interested Party who desires to be deemed a Qualified Bidder must deliver to
Evercore, with copies to Davis Polk & Wardwell LLP, 450 Lexington Avenue, New
York, New York 10017 (Attn: Brian M. Resnick, Steven Z. Szanzer, and Nate
Sokol), the Required Bid Documents (as defined below) so as to be received no
later than 12:00 p.m. (prevailing Central Time) on March 30, 2020
(the “Bid Deadline”); provided, however, that the Court may extend the Bid
Deadline upon request by a party-in-interest and for cause shown, and all
parties’ rights are reserved in connection with any such request.

 

(b)Sale Bid Requirements

 

All bids for sale transactions must include the following items (collectively,
the “Required Bid Documents”):

 

·a letter stating that the bidder’s offer is irrevocable until consummation of a
transaction involving the Bid Assets (or lot thereof) identified in such offer;

 

·a duly authorized and executed purchase agreement satisfactory to the Debtors,
based on one of the forms of asset purchase agreement in the Data Room (unless
the Debtors otherwise agree, in consultation with the Consultation Parties, to
the use of a different asset purchase agreement), marked to show any revisions,
including, among other things, the purchase price for the Bid Assets (or lot
thereof, as applicable), together with all exhibits and schedules, in each case
marked to show those amendments and modifications to the applicable form of
asset purchase agreement;

 

 2 

 

·a proposed Sale Order with a redline marked to show those amendments and
modifications to the form in the Data Room;

 

·a summary (not to exceed five pages) of the material terms and conditions of
the bid;

 

·written evidence acceptable to the Debtors, in consultation with the
Consultation Parties, demonstrating financial wherewithal, operational ability,
and corporate authorization to consummate the proposed transaction, such as, (i)
the bidder’s tax returns and audited financial statements (or un-audited, if
audited financials are not available) and any supplemental schedules for the
calendar or fiscal years ending 2017 and 2018, (ii) the number (if any) of dairy
or other facilities that the bidder operates and all trade names that the bidder
uses (if any), (iii) the bidder’s intended use of the premises, (iv) the
bidder’s experience (if any) operating dairy or other facilities; and

 

·written evidence of a firm commitment for financing to consummate the proposed
transaction, or other evidence of ability to consummate the proposed transaction
without financing, in either case which is satisfactory to the Debtors, in
consultation with the Consultation Parties.

 

A bid for a sale transaction will be considered only if the bid:

 

·identifies the legal name of the purchaser (including any Sponsor(s), if the
purchaser is an entity formed for the purpose of consummating the proposed
transaction);

 

·identifies the Bid Assets (or lot thereof) to be purchased and the contracts
and leases to be assumed;

 

·identifies the liabilities of the Debtors or the Bid Assets (or lot thereof) to
be assumed. In particular, each bid must state whether or not the bidder intends
to assume (i) sponsorship of all or any part of, or (ii) any of the potential
liabilities associated with, the Dean Foods Consolidated Pension Plan (the
“Single-Employer Pension Plan”);

 

 3 

 

·expressly proposes terms for all employees, including, but not limited to, the
treatment of the Debtors’ prepetition collective bargaining agreements and the
Debtors’ participation in the Single-Employer Pension Plan and their
participation in multi-employer pension and health plans (collectively, the
“Employee Obligations”), including whether or not the bidder intends to assume
sponsorship of all or any portion of the Single-Employer Pension Plan;

 

·sets forth the consideration for the Bid Assets (or lot thereof) to be
purchased and the Contracts and Leases to be assumed (the “Bid Consideration”);

 

·is not conditioned on (i) obtaining financing or (ii) the outcome of
unperformed due diligence;

 

·includes a description of all governmental, licensing, bonding obligations
(including financial assurance and surety bonds), regulatory, or other approvals
or consents that are required to consummate the proposed transaction (including
any antitrust approval related to the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended), together with evidence satisfactory to the Debtors, in
consultation with the Consultation Parties, of the bidder’s (i) ability to
obtain such approvals or consents and (ii) financial resources necessary to
obtain or replace any surety bonds associated with any licenses (the “Bonding
Assurance Information”), in each case as soon as reasonably practicable (and in
no event later than June 1, 2020), as well as a description of any material
contingencies or other conditions that will be imposed upon, or that will
otherwise apply to, the obtainment or effectiveness of any such approvals or
consents;

 

·expressly states that the bidder agrees to serve as an Alternate Bidder (as
defined below) if such bidder’s Qualified Bid is selected as the next highest or
next best bid after the Successful Bid (as hereinafter defined) with respect to
the applicable Bid Assets;

 

·is accompanied by a cash deposit by wire transfer to an escrow agent selected
by the Debtors (the “Deposit Agent”) in an amount equal to seven percent of the
cash consideration set forth in connection with such bid (any such deposit,
a “Good Faith Deposit”);

 

 4 

 

·sets forth the representatives that are authorized to appear and act on behalf
of the bidder in connection with the proposed transaction;

 

·indicates that the bidder will not seek any transaction or break-up fee,
expense reimbursement, or similar type of payment;

 

·includes evidence of the bidder’s ability to comply with section 365 of the
Bankruptcy Code (to the extent applicable), including providing adequate
assurance of such bidder’s ability to perform in the future the contracts and
leases proposed in its bid to be assumed by the Debtors and assigned to the
bidder, in a form that will permit the Debtors to disseminate immediately such
evidence to the non-Debtor counterparties to such contracts and leases (the
“Adequate Assurance Information”);

 

·indicates whether or not the bidder will assume all cure costs associated with
any Contracts and Leases it intends to assume; and

 

·is received on or before the Bid Deadline (as such deadline may be extended in
accordance with these Bidding Procedures).

 

A bid received from an Interested Party will constitute a Qualified Bid only if
it includes all of the applicable Required Bid Documents and meets all of the
applicable requirements above (other than a Chapter 11 Plan Bid and a credit bid
described in Section 3 below); provided, however, the Debtors, in consultation
with the Consultation Parties, shall have the right to deem a bid a Qualified
Bid even if such bid does not conform to one or more of the requirements above
or does not include one or more of the applicable Required Bid Documents. As
soon as such bids are received, the Debtors shall provide copies of all bids to
the Consultation Parties. If the Debtors receive a bid prior to the Bid Deadline
that is not a Qualified Bid, the Debtors, in consultation with the Consultation
Parties, may provide the bidder with the opportunity to remedy any deficiencies
through and after the Bid Deadline. If any bid is determined by the Debtors, in
consultation with the Consultation Parties, not to be a Qualified Bid, and the
applicable bidder fails to remedy such bid in accordance with these Bidding
Procedures, the Debtors, to the extent applicable, shall promptly instruct the
Deposit Agent to return such bidder’s Good Faith Deposit.

 

Notwithstanding any other provision of these Bidding Procedures, the Debtors, in
consultation with the Consultation Parties, may evaluate bids on any grounds,
including, but not limited to, and to the extent applicable, (i) the amount of
the purchase price, including non-cash consideration, set forth in the bid, (ii)
the value to be provided to the Debtors under the bid, including the net
economic effect upon the Debtors’ estates, (iii) any benefit to the Debtors’
estates from any assumption of liabilities or waiver of liabilities, including
the release or replacement of letters of credit, (iv) the transaction structure
and execution risk, including conditions to and certainty of closing,
termination provisions, availability of financing and financial wherewithal to
meet all commitments, and required governmental or other approvals, (v) the
anticipated timing to closing and whether such timing is consistent with the
Debtors’ adherence to the Approved Budget (as defined in the DIP Credit
Agreement), (vi) the impact on employees, including the actual or potential
elimination of employee benefits and/or the reduction in value of such benefits,
and also employee claims against the Debtors, (vii) the presence of any
governmental, licensing, regulatory, or other approvals or consents in a bid,
and the anticipated timing or likelihood of obtaining such approvals or
consents, (viii) the impact on trade and other creditors, (ix) the impact on
Employee Obligations, including the assumption of sponsorship of or liabilities
associated with the Single-Employer Pension Plan or the assumption of any
obligations and/or liabilities associated with any multi-employer pension and/or
health plan, (including participation therein), and (x) any other factors the
Debtors, in consultation with the Consultation Parties, may reasonably deem
relevant consistent with their fiduciary duties (as reasonably determined in
good faith by the Debtors in consultation with their outside legal counsel).
Notwithstanding anything to the contrary in the foregoing, the Debtors shall
consult with the Consultation Parties on any grounds for evaluating bids. For
the avoidance of doubt, the presence of any governmental, licensing, regulatory,
or other approvals or consents in a bid, and the anticipated timing or
likelihood of obtaining such approvals or consents, may be grounds for the
Debtors, in consultation with the Consultation Parties, to determine that such
bid (i) is not a Qualified Bid or (ii) is not higher or otherwise better than
any other Qualified Bid.

 

 5 

 

By submission of its bid, each Qualified Bidder shall be deemed to acknowledge
and represent that it (i) has relied solely upon its own independent review,
investigation, and/or inspection of any documents and/or the assets in making
its bid, (ii) did not rely upon any written or oral statements, representations,
promises, warranties, or guaranties whatsoever, whether express, implied, by
operation of law, or otherwise, regarding the Bid Assets (or lots thereof), or
the completeness of any information provided in connection therewith, except as
expressly stated in these Bidding Procedures or the asset purchase agreement(s)
with any Successful Bidder(s), (iii) has not engaged in any collusion with
respect to the bidding or the sale of any of the Bid Assets, (iv) has reviewed,
understands, and accepts these Bidding Procedures, (v) has consented to the
jurisdiction of the Bankruptcy Court, and (vi) intends to consummate its
Qualified Bid if it is selected as the Successful Bid. A Qualified Bidder may
not amend, modify, or withdraw its Qualified Bid during the period that such
Qualified Bid is required to remain irrevocable.

 

Absent further order or direction of the Court, by no later than March 30, 2020
at 11:59 p.m. (prevailing Central Time), the Debtors shall file copies of all
bids received by the Bid Deadline.

 

3.Credit Bid

 

Subject to the terms and conditions set forth in the DIP Order, the DIP Agent,
with the consent of the Required Lenders, shall have the right (on behalf of the
DIP Lenders) to credit bid the amounts of the DIP Obligations (other than, prior
to the Challenge Period Termination Date, the DIP Roll-Up Loans) in connection
with any sale of all or substantially all of the Debtors’ assets and property.
If the DIP Agent submits a credit bid in accordance with the foregoing, and such
bid is received by the Bid Deadline, such bidder shall be deemed to be a
Qualified Bidder and any such credit bid shall be deemed to be a Qualified Bid.

 

 6 

 

4.Selection of Successful Bid(s) AND ALTERNATE bID(S)

 

The Debtors, in consultation with the Consultation Parties, shall (a) review and
evaluate each bid on the basis of financial and contractual terms and other
factors relevant to the sale process, including those factors affecting the
speed and certainty of consummating the sale transaction, (b) determine and
identify the highest or otherwise best offer or collection of offers
(the “Successful Bid(s)”), (c) determine and identify the next highest or
otherwise best offer or collection of offers (the “Alternate Bid(s)”), and
(d) notify all Qualified Bidders (i) the identity of the party or parties that
submitted the Successful Bid(s) (the “Successful Bidder(s)”), (ii) the amount
and other material terms of the Successful Bid(s), (iii) the identity of the
party or parties that submitted the Alternate Bid(s)
(the “Alternate Bidder(s)”), and (iv) the amount and other material terms of the
Alternate Bid(s). Each Qualified Bidder shall agree and be deemed to agree to be
the Alternate Bidder if so designated. Notwithstanding the foregoing sentence or
anything in the Bidding Procedures to the contrary, any Qualified Bid submitted
by the DIP Agent shall not be required to serve as an Alternate Bid absent
consent of the DIP Agent.

 

Absent further order or direction of the Court, by no later than March 30, 2020
at 11:59 p.m. (prevailing Central Time), the Debtors shall file copies of the
following: (a) a notice designating (after consultation with the Consultation
Parties) the Successful Bidder(s) and Alternate Bidders(s) for the Bid Assets
(the “Notice of Bid Results”); provided that the Debtors may determine not to
designate Successful Bidders and Alternate Bidders with respect to certain Bid
Assets if they believe, in consultation with the Consultation Parties, that
extending the sale process with respect to such Bid Assets would likely to
maximize value for the benefit of the Debtors’ estates; and (b) final form(s) of
order(s) approving the Sale Transaction(s) as agreed upon between the Debtors
(in consultation with the Consultation Parties) and the Successful Bidder(s)
(the “Sale Order(s)”).

 

As soon as reasonably practicable after the filing of the Notice of Bid Results,
(a) the Successful Bidder(s) and the applicable Debtors shall complete and
execute all agreements, instruments, and other documents necessary to consummate
the applicable sale or other transaction(s) contemplated by the applicable
Successful Bid(s) and (b) the Debtors shall (i) deliver the Adequate Assurance
Information to non-Debtor counterparties to contracts and leases proposed to be
assumed by the Debtors and assigned to the Successful Bidder(s) and Alternate
Bidder(s), and (ii) deliver the Bonding Assurance Information to sureties
providing bonding for any licenses proposed to being transferred.

 

5.The Sale Hearing

 

The hearing to consider the proposed Sale Order (the “Sale Hearing”) will be
held on April 3, 2020 at: 9:00 a.m. (prevailing Central time) before the
Honorable Judge David R. Jones, in the United States Bankruptcy Court for the
Southern District of Texas, 515 Rusk St., Houston, Texas 77002. The Sale Hearing
may be adjourned by the Debtors, in consultation with the Consultation Parties,
by an announcement of the adjourned date at a hearing before the Bankruptcy
Court or by filing a notice on the Bankruptcy Court’s docket. At the Sale
Hearing, the Debtors will seek the Bankruptcy Court’s approval of the Successful
Bid(s) and, at the Debtors’ election, the Alternate Bid(s).

 

 7 

 

The Debtors’ presentation to the Bankruptcy Court of the Successful Bid(s) and
Alternate Bid(s) will not constitute the Debtors’ acceptance of such bid(s),
which acceptance will only occur upon approval of such bid(s) by the Bankruptcy
Court. Following the Bankruptcy Court’s entry of the Sale Order, the Debtors and
the Successful Bidder(s) shall proceed to consummate the transaction(s)
contemplated by the Successful Bid(s). If the Debtors and the Successful
Bidder(s) fail to consummate the proposed transaction(s), then the Debtors shall
file a notice with the Bankruptcy Court advising of such failure. Upon the
filing of such notice with the Bankruptcy Court, the Alternate Bid(s) will be
deemed to be the Successful Bid(s) and the Debtors will be authorized, but not
directed, to effectuate the transaction(s) with the Alternate Bidder(s) subject
to the terms of the Alternate Bid(s) of such Alternate Bidder(s) without further
order of the Bankruptcy Court. If the failure to consummate the transaction(s)
contemplated by the Successful Bid(s) is the result of a breach by the
Successful Bidder(s) (the “Breaching Bidder(s)”) of its (their) asset purchase
agreement(s), the Debtors reserve the right to seek all available remedies from
such Breaching Bidder(s), subject to the terms of the applicable asset purchase
agreement.

 

6.Return of Good Faith Deposit

 

The Good Faith Deposits of all Qualified Bidders will be held in escrow by the
Deposit Agent and will not become property of the Debtors’ bankruptcy estates
unless released to the Debtors from escrow pursuant to terms of the applicable
escrow agreement or pursuant to further order of the Bankruptcy Court. The
Deposit Agent will retain the Good Faith Deposits of the Successful Bidder(s)
and the Alternate Bidder(s) until the consummation of the transaction(s)
contemplated by the Successful Bid(s) or the Alternate Bid(s), as applicable, in
accordance with Section 4 above, except as otherwise ordered by the Bankruptcy
Court. The Good Faith Deposits (and all interest accrued thereon) of the other
Qualified Bidders will be returned within four business days after the entry of
the applicable Sale Order(s). At the closing of the transaction contemplated by
the Successful Bid(s), the Successful Bidder(s) will receive a credit in the
amount of its Good Faith Deposit (plus all interest accrued thereon). All
remaining Good Faith Deposits of the Alternate Bidders (and all interest accrued
thereon) held by the Deposit Agent will be released by the Deposit Agent four
business days after the consummation of the transaction(s) contemplated by the
Successful Bid(s); provided, however, that the Deposit Agent will retain the
Good Faith Deposit of a Breaching Bidder pending a ruling by the Bankruptcy
Court as to the amount of damages owed, if any, by such Breaching Bidder to the
Debtors.

 

7.As Is, Where Is

 

The sale of the Bid Assets shall be on an “as is, where is” basis and without
representations or warranties of any kind, nature or description by the Debtors,
their agents, or their estates, except as provided in a purchase agreement, as
approved by the Bankruptcy Court.

 

 8 

 

8.Free and Clear of Any and All Interests

 

Except as otherwise provided in a Successful Bidder(s)’s purchase agreement, all
of the Debtors’ right, title and interest in and to the Bid Assets subject
thereto shall be sold free and clear of any pledges, liens, security interests,
encumbrances, claims, charges, options, and interests thereon (collectively,
the “Interests”) to the maximum extent permitted by section 363 of the
Bankruptcy Code, with such Interests to attach to the net proceeds of the sale
of the Bid Assets with the same validity and priority as such Interests applied
against the Bid Assets.

 

9.Reservation of Rights

 

Except as otherwise provided in these Bidding Procedures or the Bidding
Procedures Order, the Debtors reserve the right in their discretion (in
consultation with the Consultation Parties) to:

 

·determine which Interested Parties are Qualified Bidders;

 

·determine which bids are Qualified Bids;

 

·determine which Qualified Bid(s) is/are the highest or otherwise best offer(s)
for the Bid Assets and which is/are the next highest or otherwise best offer(s);

 

·reject any bid that the Debtors deem to be (a) inadequate or insufficient,
(b) not in conformity with the requirements of these Bidding Procedures or the
requirements of the Bankruptcy Code, the Bankruptcy Rules, and the Local
Bankruptcy Rules, or (c) contrary to the best interests of the Debtors and their
estates;

 

·impose additional terms and conditions with respect to all Interested Parties;

 

·seek an extension of the deadlines set forth herein; and

 

·modify these Bidding Procedures and implement additional procedural rules that
the Debtors determine, in consultation with the Consultation Parties, will
better promote the goals of the Bidding Process and discharge the Debtors’
fiduciary duties, in each case, to the extent not materially inconsistent with
these Bidding Procedures and the Bidding Order.

 

Nothing in these Bidding Procedures shall require the Debtors’ board of
directors to take any action, or to refrain from taking any action, with respect
to these Bidding Procedures, to the extent that the Debtors’ board of directors
determines, or based on the advice of counsel, that taking such action, or
refraining from taking such action, as applicable, is required to comply with
applicable law or its fiduciary duties under applicable law (as reasonably
determined in good faith by the Debtors in consultation with their outside legal
counsel). Accordingly, at any time prior to the Bankruptcy Court’s entry of a
Sale Order, the Debtors may withdraw the Motion and pursue an alternative
transaction, including a plan of reorganization.

 

 9 

 

Subject to consent and consultation rights of the Consultation Parties set forth
herein, all parties reserve their rights to seek Bankruptcy Court relief with
regard to the Bidding Procedures and any related items. All Consultation Parties
will be permitted to seek relief from the Bankruptcy Court on an expedited basis
if they disagree with any actions or decision made by the Debtors as part of
these Bidding Procedures. The rights of all Consultation Parties with respect to
the outcome of the bidding process are reserved.

 

10.Relevant Dates

 

March 19, 2020 at 2:00 p.m.
(prevailing Central Time) Hearing to consider approval of the Bidding Procedures
and entry of the Bidding Procedures Order March 20, 2020 Target date for the
Debtors to file Potential Assumed Contracts Schedule March 30, 2020 at 12:00
p.m.
(prevailing Central Time) Bid Deadline March 30, 2020 at 11:59 p.m.
(prevailing Central Time) Deadline for the Debtors to file with the Court copies
of all bids received by the Bid Deadline, the Notice of Bid Results, and the
proposed Sale Order(s) April 1, 2020 at 12:00 p.m.
(prevailing Central Time) Deadline to object to the Sale Transaction(s) to the
Successful Bidder(s), and Assumption and Assignment Objection Deadline April 3,
2020 at 9:00 a.m.
(prevailing Central Time) Sale Hearing

 

 

 10 

 

Form of Sale Notice

 

 

 

IN THE UNITED STATES BANKRUPTCY COURT

FOR THE SOUTHERN DISTRICT OF TEXAS

HOUSTON DIVISION

 

_________________________________________  

 

In re:

 

SouthERN FOODS GROUPS, LLC, et al.,

 

Debtors.1

)

)

)

)

)

)

)

 

Chapter 11

 

Case No. 19-36313 (DRJ)

 

Jointly Administered

_________________________________________ )

 

         

NOTICE OF SALE, BIDDING PROCEDURES, AND SALE HEARING

______________________________________________________________________________

 

PLEASE TAKE NOTICE that the above-captioned debtors and debtors in possession
(collectively, the “Debtors”) each filed a voluntary petition for relief under
chapter 11 of title 11 of the United States Code in the United States Bankruptcy
Court for the Southern District of Texas (the “Court”) on November 12, 2019.

 

PLEASE TAKE FURTHER NOTICE that, on February 17, 2020, in connection with the
proposed sale (the “Sale Transaction”) of all, substantially all, or a portion
of Debtors’ assets (collectively, the “Bid Assets”), the Debtors filed a motion
(the “Bidding Procedures Motion”)2 with the Court seeking entry of orders, among
other things, approving (a) procedures for the solicitation of bids in
connection with the Sale Transaction (the “Bidding Procedures”), (b) the form
and manner of notice related to the Sale Transaction, and (c) procedures for the
assumption and assignment of contracts and leases in connection with the Sale
Transaction.

 

PLEASE TAKE FURTHER NOTICE that, on [March 19], 2020, the Court entered an order
(the “Bidding Procedures Order”) approving, among other things, the Bidding
Procedures, which establish the key dates and times related to the Sale
Transaction (as modified by such Bidding Procedures Order). All parties
interested in bidding should carefully read the Bidding Procedures Order and the
Bidding Procedures in their entirety.2

 

 

 

1The debtors and debtors in possession in these chapter 11 cases, along with the
last four digits of their respective Employer Identification Numbers, are as
follows: Southern Foods Group, LLC (1364); Dean Foods Company (9681); Alta-Dena
Certified Dairy, LLC (1347); Berkeley Farms, LLC (8965); Cascade Equity Realty,
LLC (3940); Country Fresh, LLC (6303); Dairy Information Systems Holdings, LLC
(9144); Dairy Information Systems, LLC (0009); Dean Dairy Holdings, LLC (9188);
Dean East II, LLC (9192); Dean East, LLC (8751); Dean Foods North Central, LLC
(7858); Dean Foods of Wisconsin, LLC (2504); Dean Holding Company (8390); Dean
Intellectual Property Services II, Inc. (3512); Dean International Holding
Company (9785); Dean Management, LLC (7782); Dean Puerto Rico Holdings, LLC
(6832); Dean Services, LLC (2168); Dean Transportation, Inc. (8896); Dean West
II, LLC (9190); Dean West, LLC (8753); DFC Aviation Services, LLC (1600); DFC
Energy Partners, LLC (3889); DFC Ventures, LLC (4213); DGI Ventures, Inc.
(6766); DIPS Limited Partner II (7167); Franklin Holdings, Inc. (8114); Fresh
Dairy Delivery, LLC (2314); Friendly’s Ice Cream Holdings Corp. (7609);
Friendly’s Manufacturing and Retail, LLC (9828); Garelick Farms, LLC (3221);
Mayfield Dairy Farms, LLC (3008); Midwest Ice Cream Company, LLC (0130); Model
Dairy, LLC (7981); Reiter Dairy, LLC (3675); Sampson Ventures, LLC (7714);
Shenandoah’s Pride, LLC (2858); Steve’s Ice Cream, LLC (6807); Suiza Dairy
Group, LLC (2039); Tuscan/Lehigh Dairies, Inc. (6774); Uncle Matt’s Organic,
Inc. (0079); and Verifine Dairy Products of Sheboygan, LLC (7200). The debtors’
mailing address is 2711 North Haskell Avenue, Suite 3400, Dallas, TX 75204.

 

2Capitalized terms used but not otherwise defined herein shall have the meanings
ascribed to them in the Bidding Procedures Motion.

 

 

 

Contact Persons for Parties Interest in Submitting a Bid

 

The Bidding Procedures set forth the requirements for submitting a bid, and any
person interested in making an offer to purchase the Bid Assets should comply
with the Bidding Procedures.3

 

Any interested bidder should contact, as soon as practicable:

 

EVERCORE GROUP L.L.C.4

55 East 52nd Street

New York, NY 10055

Attn.: John Kimm

john.kimm@evercore.com

(tel.) +1 (212) 849-3436

 

Obtaining Additional Information

 

Copies of the Bidding Procedures Motion and the Bidding Procedures Order, as
well as all related exhibits (including the Bidding Procedures) and all other
documents filed with the Court, are available free of charge on the Debtors’
case information website, located at https://dm.epiq11.com/SouthernFoods or can
be requested by email at DeanInfo@epiqglobal.com.

 

Important Dates and Deadlines

 

1.Bid Deadline. The deadline to submit a bid is March 30, 2020 at 12:00 p.m.
(prevailing Central Time).

 

2.Public Filings. Absent further order or direction of the Court, by no later
than March 30, 2020 at 11:59 p.m. (prevailing Central Time), the Debtors shall
file copies of the following: (a) all bids received by the Bid Deadline; (b) a
Notice of Bid Results; provided that the Debtors may determine not to designate
Successful Bidders and Alternate Bidders with respect to certain Bid Assets if
they believe, in consultation with the Consultation Parties, that extending the
sale process with respect to such Bid Assets would likely to maximize value for
the benefit of the Debtors’ estates; and (c) the proposed Sale Order(s).

 

3.Sale Objection Deadline. The deadline to file an objection with the Court to
the proposed Sale Order(s) or the Sale Transaction(s) (collectively, the “Sale
Objections”) is April 1, 2020 at 12:00 pm. (prevailing Central Time) (the “Sale
Objection Deadline”).

 

4.Sale Hearing. A hearing (the “Sale Hearing”) to consider the proposed Sale
Transaction(s) will be held before the Court on April 3, 2020 at 9:00 a.m.
(prevailing Central Time)5 or such other date as determined by the Court, at 515
Rusk St., Houston, Texas 77002.

 

Filing Objections

 

Sale Objections, if any, must (a) be in writing, (b) state, with specificity,
the legal and factual bases thereof, (c) comply with the Bankruptcy Code,
Bankruptcy Rules, and Local Rules, (d) be filed with the Court no later than the
Sale Objection Deadline, and (e) no later than the Sale Objection deadline, be
served on (i) counsel to the Debtors, (y) Davis Polk & Wardwell LLP, 450
Lexington Avenue, New York, New York 10017, Attn: Brian M. Resnick, Steven Z.
Szanzer, and Nate Sokol and (z) Norton Rose Fulbright US LLP, 1301 McKinney
Street, Suite 5100, Houston, Texas 77010, Attn: William Greendyke, Jason L.
Boland, Robert B. Bruner, and Julie Harrison, (ii) (y) counsel to the DIP Agent
and the Prepetition Agent, White & Case LLP, 1221 Avenue of the Americas, New
York, NY 10020, Attn: Scott Greissman, Philip Abelson, and Elizabeth Feld and
(z) Gray Reed, 1300 Post Oak Blvd, Suite 2000, Houston, TX 77056, Attn: Jason S.
Brookner, (iii) counsel to the Committee, Akin Gump Strauss Hauer & Feld LLP,
One Bryant Park, New York, NY 10036, Attn: Philip Dublin and Meredith Lahaie,
and (iv) the U.S. Trustee.

 

 

3To the extent of any inconsistencies between the Bidding Procedures and the
summary descriptions of the Bidding Procedures in this notice, the terms of the
Bidding Procedures shall control in all respects.

 

4Evercore Group L.L.C., in its capacity as financial advisor the Debtors, is
referred to herein as “Evercore.”

 

5This date remains subject to Court approval.

 

 

 

CONSEQUENCES OF FAILING TO TIMELY ASSERT AN OBJECTION

 

Any party or entity who fails to timely make an objection to the Sale
Transaction(s) on or before the Sale Objection Deadline in accordance with the
Bidding Procedures Order and this Notice shall be forever barred from asserting
any objection to the Sale Transaction(s), including with respect to the transfer
of the assets free and clear of all liens, claims, encumbrances, and other
interests.

 

NO SUCCESSOR LIABILITY

 

The Debtors are a leading public food and beverage company and the largest
processor and direct-to-store distributor of fresh fluid milk and other dairy
and dairy case products in the United States. The Debtors manufacture, market,
and distribute a wide variety of branded and private label dairy and dairy case
products, including fluid milk, ice cream, cultured dairy products, creamers,
ice cream mix, and other dairy products to retailers, distributors, foodservice
outlets, educational institutions, and governmental entities across the United
States. For more information on the Debtors’ businesses or their products, refer
to the Declaration of Gary Rahlfs in Support of Debtors’ Chapter 11 Proceedings
and First Day Pleadings [D.I. 46]. The assets sold in the Sale Transaction(s)
will be free and clear of, among other things, any claim arising from any
conduct of the Debtors prior to the closing of the Sale Transaction(s), whether
known or unknown, whether due or to become due, whether accrued, absolute,
contingent, or otherwise, so long as such claim arises out of or relates to
events occurring prior to the closing of the Sale Transaction(s). Accordingly,
as a result of the Sale Transaction(s), the Successful Bidder(s) will not be a
successor to any of the Debtors by reason of any theory of law or equity, and
the Successful Bidder(s) will have no liability, except as expressly provided a
definitive agreement reached between the Debtors and the Successful Bidder(s),
for any liens, claims, encumbrances, and other interests against or in any of
the Debtors under any theory of law, including successor liability theories.

 

[Remainder of This Page Intentionally Left Blank]

 

 

 

Dated:[·], 2020
Houston, Texas

   

Respectfully submitted,

 

NORTON ROSE FULBRIGHT US LLP

 

 

/s/ Draft                                              

William R. Greendyke (SBT 08390450)

Jason L. Boland (SBT 24040542)

Robert B. Bruner (SBT 24062637)

Julie Goodrich Harrison (SBT 24092434)

1301 McKinney Street, Suite 5100

Houston, Texas 77010-3095

Tel.: (713) 651-5151

Fax: (713) 651-5246

william.greendyke@nortonrosefulbright.com

jason.boland@nortonrosefulbright.com

bob.bruner@nortonrosefulbright.com

julie.harrison@nortonrosefulbright.com

 

-and-

 

     

DAVIS POLK & WARDWELL LLP

 

Brian M. Resnick (admitted pro hac vice)

Elliot Moskowitz (admitted pro hac vice)

Steven Szanzer (admitted pro hac vice)

Nate Sokol (admitted pro hac vice)

450 Lexington Avenue

New York, New York 10017

Tel.: (212) 450-4000

Fax: (212) 701-5800
brian.resnick@davispolk.com
elliot.moskowitz@davispolk.com

steven.szanzer@davispolk.com

nathaniel.sokol@davispolk.com

 

 

Counsel to the Debtors and Debtors in Possession

 

 

 4 

 

Form of Potential Assumption and Assignment Notice

 

 

 

IN THE UNITED STATES BANKRUPTCY COURT

FOR THE SOUTHERN DISTRICT OF TEXAS

HOUSTON DIVISION

 

_________________________________________  

 

In re:

 

SouthERN FOODS GROUPS, LLC, et al.,

 

Debtors.1

)

)

)

)

)

)

)

 

Chapter 11

 

Case No. 19-36313 (DRJ)

 

Jointly Administered

_________________________________________ )

 

         

NOTICE OF POTENTIAL ASSUMPTION AND ASSIGNMENT OF EXECUTORY CONTRACTS OR
UNEXPIRED LEASES AND CURE COSTS

______________________________________________________________________________

 

PLEASE TAKE NOTICE that the above-captioned debtors and debtors in possession
(collectively, the “Debtors”) each filed a voluntary petition for relief under
chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”) in the
United States Bankruptcy Court for the Southern District of Texas (the “Court”)
on November 12, 2019.

 

PLEASE TAKE FURTHER NOTICE that, on February 17, 2020, in connection with the
proposed sale (the “Sale Transaction”) of all, substantially all, or a portion
of Debtors’ assets (collectively, the “Bid Assets”), the Debtors filed a motion
(the “Bidding Procedures Motion”)2 with the Court seeking entry of orders, among
other things, approving (a) procedures for the solicitation of bids in
connection with the Sale Transaction (the “Bidding Procedures”), (b) the form
and manner of notice related to the Sale Transaction, and (c) procedures for the
assumption and assignment of contracts and leases in connection with the Sale
Transaction (the “Assumption and Assignment Procedures”).

 

PLEASE TAKE FURTHER NOTICE that, on [March 19], 2020, the Court entered an order
(the “Bidding Procedures Order”) approving, among other things, the Bidding
Procedures (as modified by such Bidding Procedures Order), which establish the
key dates and times related to the Sale Transaction and the Assumption and
Assignment Procedures.

 

 

1The debtors and debtors in possession in these chapter 11 cases, along with the
last four digits of their respective Employer Identification Numbers, are as
follows: Southern Foods Group, LLC (1364); Dean Foods Company (9681); Alta-Dena
Certified Dairy, LLC (1347); Berkeley Farms, LLC (8965); Cascade Equity Realty,
LLC (3940); Country Fresh, LLC (6303); Dairy Information Systems Holdings, LLC
(9144); Dairy Information Systems, LLC (0009); Dean Dairy Holdings, LLC (9188);
Dean East II, LLC (9192); Dean East, LLC (8751); Dean Foods North Central, LLC
(7858); Dean Foods of Wisconsin, LLC (2504); Dean Holding Company (8390); Dean
Intellectual Property Services II, Inc. (3512); Dean International Holding
Company (9785); Dean Management, LLC (7782); Dean Puerto Rico Holdings, LLC
(6832); Dean Services, LLC (2168); Dean Transportation, Inc. (8896); Dean West
II, LLC (9190); Dean West, LLC (8753); DFC Aviation Services, LLC (1600); DFC
Energy Partners, LLC (3889); DFC Ventures, LLC (4213); DGI Ventures, Inc.
(6766); DIPS Limited Partner II (7167); Franklin Holdings, Inc. (8114); Fresh
Dairy Delivery, LLC (2314); Friendly’s Ice Cream Holdings Corp. (7609);
Friendly’s Manufacturing and Retail, LLC (9828); Garelick Farms, LLC (3221);
Mayfield Dairy Farms, LLC (3008); Midwest Ice Cream Company, LLC (0130); Model
Dairy, LLC (7981); Reiter Dairy, LLC (3675); Sampson Ventures, LLC (7714);
Shenandoah’s Pride, LLC (2858); Steve’s Ice Cream, LLC (6807); Suiza Dairy
Group, LLC (2039); Tuscan/Lehigh Dairies, Inc. (6774); Uncle Matt’s Organic,
Inc. (0079); and Verifine Dairy Products of Sheboygan, LLC (7200). The debtors’
mailing address is 2711 North Haskell Avenue, Suite 3400, Dallas, TX 75204.

 

2Capitalized terms used but not otherwise defined herein shall have the meanings
ascribed to them in the Bidding Procedures Motion.

 

 

 

PLEASE TAKE FURTHER NOTICE that, upon the closing of a Sale Transaction, the
Debtors intend to assume and assign to the Successful Bidder(s) the Potential
Assumed Contracts. A schedule listing the Potential Assumed Contracts (the
“Potential Assumed Contracts Schedule”) is attached hereto and may also be
accessed free of charge on the Debtors’ case information website, located at
https://dm.epiq11.com/SouthernFoods or can be requested by email at
DeanInfo@epiqglobal.com. In addition, the “Cure Costs” as of the date of the
Bidding Procedures Order, if any, necessary for the assumption and assignment of
the Potential Assumed Contracts are set forth on the Potential Assumed Contracts
Schedule. Each Cure Cost listed on the Potential Assumed Contracts Schedule
represents all liabilities of any nature of the Debtors arising under an Assumed
Contract or Assumed Lease as of the date of the Bidding Procedures Order,
whether known or unknown, whether due or to become due, whether accrued,
absolute, contingent, or otherwise.

 

YOU ARE RECEIVING THIS NOTICE BECAUSE YOU HAVE BEEN IDENTIFIED AS A COUNTERPARTY
TO A POTENTIAL ASSUMED CONTRACT. Under the terms of the Assumption and
Assignment Procedures, (a) at or prior to the closing of a Sale Transaction, a
Successful Bidder may elect, in its sole and absolute discretion, (i) to exclude
any contract or lease on the Potential Assumed Contracts Schedule as an Assumed
Contract or Assumed Lease, as applicable (in which case it shall become an
Excluded Contract or Excluded Lease, as applicable, and will not reduce the
purchase price) or (ii) to include on its Proposed Assumed Contracts Schedule
any contract or lease listed on the Potential Assumed Contracts Schedule, so
long as such Successful Bidder is paying the Cure Costs therefor, by providing
to the Debtors written notice of its election to exclude or include such
contract or lease, as applicable, (b) if the Debtors or any Successful Bidder
identify during the pendency of the Chapter 11 Cases (before the closing of the
Sale Transaction) any contract or lease that is not listed on the Proposed
Assumed Contracts Schedule, and such contract or lease has not been rejected by
the Debtors, so long as the Successful Bidder is paying the Cure Costs therefor,
each Successful Bidder may in its sole and absolute discretion elect by written
notice to the Debtors to treat such contract or lease as an Assumed Contract or
Assumed Lease, as applicable, and the Debtors shall seek to assume and assign
such Assumed Contract or Assumed Lease in accordance with the Bidding
Procedures, and (c) the Debtors may, in accordance the applicable purchase
agreement, or as otherwise agreed by the Debtors and the Successful Bidder(s),
at any time before the closing of a Sale Transaction, modify the previously
stated Cure Costs associated with any Proposed Assumed Contract. The Assumption
and Assignment Procedures further provide that any Counterparty whose
previously-stated Cure Cost is modified will receive notice thereof and an
opportunity to file a Supplemental Assignment Objection. The assumption and
assignment of the Contracts and Leases on the Potential Assumed Contracts
Schedule is not guaranteed and is subject to approval by the Court and the
Debtors’ or Successful Bidder’s right to remove an Assumed Contract or Assumed
Lease from the Potential Assumed Contracts Schedule and Proposed Assumed
Contracts Schedule.

 

Obtaining Additional Information

 

Copies of the Bidding Procedures Motion and the Bidding Procedures Order, as
well as all related exhibits (including the Bidding Procedures) and all other
documents filed with the Court, are available free of charge on the Debtors’
case information website, located at https://dm.epiq11.com/SouthernFoods or can
be requested by email at DeanInfo@epiqglobal.com.

 

Filing Assumption and Assignment Objections

 

Pursuant to the Assumption and Assignment Procedures, objections to the
potential assumption and assignment of an Assumed Contract or Assumed Lease (an
“Assumption and Assignment Objection”) with respect to the Debtors’ proposed
Cure Costs, if any, or the ability of a Successful Bidder to provide adequate
assurance of future performance must (a) be in writing, (b) comply with the
Bankruptcy Code, Bankruptcy Rules, and Local Rules, (c) state, with specificity,
the legal and factual bases thereof, including, if applicable, the Cure Cost
that the Counterparty believes is required to cure defaults under the relevant
Assumed Contract or Assumed Lease, and (d) by no later than April 1, 2020 at
12:00 p.m. (prevailing Central Time) (the “Assumption and Assignment Objection
Deadline”), (i) be filed with the Court and (ii) be served on (A) counsel to the
Debtors, (1) Davis Polk & Wardwell LLP, 450 Lexington Avenue, New York, New York
10017, Attn: Brian M. Resnick, Steven Z. Szanzer, and Nate Sokol and (2) Norton
Rose Fulbright US LLP, 1301 McKinney Street, Suite 5100, Houston, Texas 77010,
Attn: William Greendyke, Jason L. Boland, Robert B. Bruner, and Julie Harrison,
(B) (1) counsel to the DIP Agent and the Prepetition Agent, White & Case LLP,
1221 Avenue of the Americas, New York, NY 10020, Attn: Scott Greissman, Philip
Abelson, and Elizabeth Feld and (2) Gray Reed, 1300 Post Oak Blvd, Suite 2000,
Houston, TX 77056, Attn: Jason S. Brookner, (C) counsel to the Committee, Akin
Gump Strauss Hauer & Feld LLP, One Bryant Park, New York, NY 10036, Attn: Philip
Dublin and Meredith Lahaie, and (D) the U.S. Trustee (collectively, the
“Objection Notice Parties”).

 

 2 

 

Pursuant to the Assumption and Assignment Procedures, objections to the
potential assumption and assignment of an Assumed Contract or Assumed Lease by a
party whose contract or lease is listed on a Supplemental Assumption and
Assignment Notice (a “Supplemental Assumption and Assignment Objection”) with
respect to the ability of a Successful Bidder to provide adequate assurance of
future performance or relating to the Cure Costs (to the extent modified form
the previously-stated amount) must (a) be in writing, (b) comply with the
Bankruptcy Code, Bankruptcy Rules, and Local Rules, (c) state, with specificity,
the legal and factual bases thereof, and (d) by no later than 14 days from the
date of service of such Supplemental Assumption and Assignment Notice, (i) be
filed with the Court and (ii) be served on the Objection Notice Parties.

 

Objections to a Sale Order or a Sale Transaction (collectively, the “Sale
Objections”) must (a) be in writing, (b) state, with specificity, the legal and
factual bases thereof, (c) comply with the Bankruptcy Code, Bankruptcy Rules and
Local Rules, and (d) April 1, 2020 at 12:00 p.m. (prevailing Central Time) by
(the “Sale Objection Deadline”) be (i) filed with the Court and (ii) served on
the Objection Notice Parties.

 

A hearing to consider the proposed Sale Transaction will be held before the
Court on April 3, 2020 at 9:00 a.m. (prevailing Central Time) or such other date
as determined by the Court at 515 Rusk St., Houston, Texas 77002.

 

CONSEQUENCES OF FAILING TO TIMELY ASSERT AN OBJECTION

 

Any Counterparty to a contract or lease who fails to timely make an objection to
the potential assumption and assignment of such contract or lease on or before
the Assumption and Assignment Objection Deadline in accordance with the
Assumption and Assignment Procedures, the Bidding Procedures Order, and this
Notice (or in the case of a Supplemental Assumption and Assignment Objection, by
14 days from the date of service of such Supplemental Assumption and Assignment
Notice) shall be deemed to have consented to the assumption and assignment of
such contract or lease, including the Cure Costs (if any) set forth in the
Potential Assumption and Assignment Notice or Supplemental Assumption and
Assignment Notice, and shall be forever barred from asserting any objection or
claims against the Debtors, the Successful Bidder(s), or the property of any
such parties, relating to the assumption and assignment of such contract or
lease, including asserting additional Cure Costs with respect to such contract
or lease. Notwithstanding anything to the contrary in such contract or lease, or
any other document, the Cure Costs set forth in the Potential Assumption and
Assignment Notice or Supplemental Assumption and Assignment Notice shall be
controlling and will be the only amount necessary to cure outstanding defaults
under the applicable Assumed Contract or Assumed Lease under section 365(b) of
the Bankruptcy Code as of the date of the Bidding Procedures Order, whether
known or unknown, whether due or to become due, whether accrued, absolute,
contingent, or otherwise.

 

 3 

 

Dated:[·], 2020
Houston, Texas

   

Respectfully submitted,

 

NORTON ROSE FULBRIGHT US LLP

 

 

/s/ Draft                                                 

William R. Greendyke (SBT 08390450)

Jason L. Boland (SBT 24040542)

Robert B. Bruner (SBT 24062637)

Julie Goodrich Harrison (SBT 24092434)

1301 McKinney Street, Suite 5100

Houston, Texas 77010-3095

Tel.: (713) 651-5151

Fax: (713) 651-5246

william.greendyke@nortonrosefulbright.com

jason.boland@nortonrosefulbright.com

bob.bruner@nortonrosefulbright.com

julie.harrison@nortonrosefulbright.com

 

-and-

 

     

DAVIS POLK & WARDWELL LLP

 

Brian M. Resnick (admitted pro hac vice)

Elliot Moskowitz (admitted pro hac vice)

Steven Szanzer (admitted pro hac vice)

Nate Sokol (admitted pro hac vice)

450 Lexington Avenue

New York, New York 10017

Tel.: (212) 450-4000

Fax: (212) 701-5800
brian.resnick@davispolk.com
elliot.moskowitz@davispolk.com

steven.szanzer@davispolk.com

nathaniel.sokol@davispolk.com

 

 

Counsel to the Debtors and Debtors in Possession

 

 

 4 

 

Form of Proposed Assumption and Assignment Notice

 

 

 

IN THE UNITED STATES BANKRUPTCY COURT

FOR THE SOUTHERN DISTRICT OF TEXAS

HOUSTON DIVISION

 

_________________________________________  

 

In re:

 

SouthERN FOODS GROUPS, LLC, et al.,

 

Debtors.1

)

)

)

)

)

)

)

 

Chapter 11

 

Case No. 19-36313 (DRJ)

 

Jointly Administered

_________________________________________ )

 

         

NOTICE OF PROPOSED ASSUMPTION AND ASSIGNMENT OF EXECUTORY CONTRACTS OR UNEXPIRED
LEASES AND CURE COSTS

______________________________________________________________________________

 

PLEASE TAKE NOTICE that the above-captioned debtors and debtors in possession
(collectively, the “Debtors”) each filed a voluntary petition for relief under
chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”) in the
United States Bankruptcy Court for the Southern District of Texas (the “Court”)
on November 12, 2019.

 

PLEASE TAKE FURTHER NOTICE that, on February 17, 2020, in connection with the
proposed sale (the “Sale Transaction”) of all, substantially all, or a portion
of Debtors’ assets (collectively, the “Bid Assets”), the Debtors filed a motion
(the “Bidding Procedures Motion”)2 with the Court seeking entry of orders, among
other things, approving (a) procedures for the solicitation of bids in
connection with the Sale Transaction (the “Bidding Procedures”), (b) the form
and manner of notice related to the Sale Transaction, and (c) procedures for the
assumption and assignment of contracts and leases in connection with the Sale
Transaction (the “Assumption and Assignment Procedures”).

 

PLEASE TAKE FURTHER NOTICE that, on [March 19], 2020 the Court entered an order
(the “Bidding Procedures Order”) approving, among other things, the Bidding
Procedures, as modified by such Bidding Procedures Order, which establish the
key dates and times related to the Sale Transaction, and the Assumption and
Assignment Procedures.

 

 

1The debtors and debtors in possession in these chapter 11 cases, along with the
last four digits of their respective Employer Identification Numbers, are as
follows: Southern Foods Group, LLC (1364); Dean Foods Company (9681); Alta-Dena
Certified Dairy, LLC (1347); Berkeley Farms, LLC (8965); Cascade Equity Realty,
LLC (3940); Country Fresh, LLC (6303); Dairy Information Systems Holdings, LLC
(9144); Dairy Information Systems, LLC (0009); Dean Dairy Holdings, LLC (9188);
Dean East II, LLC (9192); Dean East, LLC (8751); Dean Foods North Central, LLC
(7858); Dean Foods of Wisconsin, LLC (2504); Dean Holding Company (8390); Dean
Intellectual Property Services II, Inc. (3512); Dean International Holding
Company (9785); Dean Management, LLC (7782); Dean Puerto Rico Holdings, LLC
(6832); Dean Services, LLC (2168); Dean Transportation, Inc. (8896); Dean West
II, LLC (9190); Dean West, LLC (8753); DFC Aviation Services, LLC (1600); DFC
Energy Partners, LLC (3889); DFC Ventures, LLC (4213); DGI Ventures, Inc.
(6766); DIPS Limited Partner II (7167); Franklin Holdings, Inc. (8114); Fresh
Dairy Delivery, LLC (2314); Friendly’s Ice Cream Holdings Corp. (7609);
Friendly’s Manufacturing and Retail, LLC (9828); Garelick Farms, LLC (3221);
Mayfield Dairy Farms, LLC (3008); Midwest Ice Cream Company, LLC (0130); Model
Dairy, LLC (7981); Reiter Dairy, LLC (3675); Sampson Ventures, LLC (7714);
Shenandoah’s Pride, LLC (2858); Steve’s Ice Cream, LLC (6807); Suiza Dairy
Group, LLC (2039); Tuscan/Lehigh Dairies, Inc. (6774); Uncle Matt’s Organic,
Inc. (0079); and Verifine Dairy Products of Sheboygan, LLC (7200). The debtors’
mailing address is 2711 North Haskell Avenue, Suite 3400, Dallas, TX 75204.

2Capitalized terms used but not otherwise defined herein shall have the meanings
ascribed to them in the Bidding Procedures Motion.

  

 

 

PLEASE TAKE FURTHER NOTICE that, upon the closing of a Sale Transaction, the
Debtors intend to assume and assign to the Successful Bidder(s) the Proposed
Assumed Contracts. A schedule listing the Proposed Assumed Contracts (the
“Proposed Assumed Contracts Schedule”) is attached hereto and may also be
accessed free of charge on the Debtors’ case information website, located at
https://dm.epiq11.com/SouthernFoods or can be requested by e-mail at
DeanInfo@epiqglobal.com. In addition, the “Cure Costs” as of the date of the
Bidding Procedures Order, if any, necessary for the assumption and assignment of
the Proposed Assumed Contracts are set forth on the Potential Assumed Contracts
Schedule.

 

YOU ARE RECEIVING THIS NOTICE BECAUSE YOU HAVE BEEN IDENTIFIED AS A COUNTERPARTY
TO A PROPOSED ASSUMED CONTRACT. Under the terms of the Assumption and Assignment
Procedures, (a) at or prior to the closing of a Sale Transaction, the Successful
Bidder(s) may elect, in its sole and absolute discretion, (i) to exclude any
contract or lease on the Proposed Assumed Contracts Schedule as an Assumed
Contract or Assumed Lease, as applicable (in which case it shall become an
Excluded Contract or Excluded Lease, as applicable, and will not reduce the
purchase price), or (ii) to include on its Proposed Assumed Contracts Schedule
any contract or lease listed on the Potential Assumed Contracts Schedule, so
long as such Successful Bidder is paying the Cure Costs therefor, by providing
to the Debtors written notice of its election to exclude or include such
contract or lease, as applicable (b) if the Debtors or any Successful Bidder
identify during the pendency of the Chapter 11 Cases (before the closing of the
Sale Transaction) any contract or lease that is not listed on the Proposed
Assumed Contracts Schedule, and such contract or lease has not been rejected by
the Debtors, so long as the Successful Bidder is paying the Cure Costs therefor,
each Successful Bidder may in its sole and absolute discretion elect by written
notice to the Debtors to treat such contract or lease as an Assumed Contract or
Assumed Lease, as applicable, and the Debtors shall seek to assume and assign
such Assumed Contract or Assumed Lease in accordance with the Bidding
Procedures, and (c) the Debtors may, in accordance with the applicable purchase
agreement, or as otherwise agreed by the Debtors and the Successful Bidder(s),
at any time before the closing of a Sale Transaction, modify the
previously-stated Cure Costs associated with any Proposed Assumed Contract. The
Assumption and Assignment Procedures further provide that any Counterparty whose
previously-stated Cure Cost is modified will receive notice thereof and an
opportunity to file a Supplemental Assumption and Assignment Objection. The
assumption and assignment of the Contracts and Leases on the Proposed Assumed
Contracts Schedule is not guaranteed and is subject to approval by the Court and
the Debtors’ or Successful Bidder’s right to remove an Assumed Contract or
Assumed Lease from the Proposed Assumed Contracts Schedule.

 

Obtaining Additional Information

 

Copies of the Bidding Procedures Motion and the Bidding Procedures Order, as
well as all related exhibits (including the Bidding Procedures) and all other
documents filed with the Court, are available free of charge on the Debtors’
case information website, located at https://dm.epiq11.com/SouthernFoods or can
be requested by e-mail at DeanInfo@epiqglobal.com.

 

Filing Assumption and Assignment Objections

 

Pursuant to the Assumption and Assignment Procedures, objections to the proposed
assumption and assignment of an Assumed Contract or Assumed Lease (an
“Assumption and Assignment Objection”) with respect to the Debtors’ proposed
Cure Costs, if any, or the ability of the Successful Bidder(s) to provide
adequate assurance of future performance must (a) be in writing, (b) comply with
the Bankruptcy Code, Bankruptcy Rules, and Local Rules, (c) state, with
specificity, the legal and factual bases thereof, including, if applicable, the
Cure Cost that the Counterparty believes is required to cure defaults under the
relevant Assumed Contract or Assumed Lease, and (d) by no later than April 1,
2020 at 12:00 p.m. (prevailing Central Time) (the “Assumption and Assignment
Objection Deadline”), (i) be filed with the Court and (ii) be served on
(A) counsel to the Debtors, (1) Davis Polk & Wardwell LLP, 450 Lexington Avenue,
New York, New York 10017, Attn: Brian M. Resnick, Steven Z. Szanzer, and Nate
Sokol, and (2) Norton Rose Fulbright US LLP, 1301 McKinney Street, Suite 5100,
Houston, Texas 77010, Attn: William Greendyke, Jason L. Boland, Robert B.
Bruner, and Julie Harrison, (B) (1) counsel to the DIP Agent and the Prepetition
Agent, White & Case LLP, 1221 Avenue of the Americas, New York, NY 10020, Attn:
Scott Greissman, Philip Abelson, and Elizabeth Feld and (2) Gray Reed, 1300 Post
Oak Blvd, Suite 2000, Houston, TX 77056, Attn: Jason S. Brookner, (C) counsel to
the Committee, Akin Gump Strauss Hauer & Feld LLP, One Bryant Park, New York, NY
10036, Attn: Philip Dublin and Meredith Lahaie, and (D) the U.S. Trustee
(collectively, the “Objection Notice Parties”).

 

 2 

 

Objections to a Sale Order or a Sale Transaction (collectively, the “Sale
Objections”) must (a) be in writing, (b) state, with specificity, the legal and
factual bases thereof, (c) comply with the Bankruptcy Code, Bankruptcy Rules and
Local Rules, and (d) April 1, 2020 at 12:00 p.m. (prevailing Central Time) by
(the “Sale Objection Deadline”) be (i) filed with the Court and (ii) served on
the Objection Notice Parties.

 

A hearing to consider the proposed Sale Transaction will be held before the
Court on April 3, 2020 at 9:00 a.m. (prevailing Central Time) or such other date
as determined by the Court at 515 Rusk St., Houston, Texas 77002.

 

CONSEQUENCES OF FAILING TO TIMELY ASSERT AN OBJECTION

 

Any Counterparty to a contract or lease who fails to timely make an objection to
the potential assumption and assignment of such contract or lease on or before
the Assumption and Assignment Objection Deadline in accordance with the
Assumption and Assignment Procedures, the Bidding Procedures Order, and this
Notice (or in the case of a Supplemental Assumption and Assignment Objection, by
14 days from the date of service of such Supplemental Assumption and Assignment
Notice) shall be deemed to have consented to the assumption and assignment of
such contract or lease, including the Cure Costs (if any) set forth in the
Potential Assumption and Assignment Notice or Supplemental Assumption and
Assignment Notice, and shall be forever barred from asserting any objection or
claims against the Debtors, the Successful Bidder(s), or the property of any
such parties, relating to the assumption and assignment of such contract or
lease, including asserting additional Cure Costs with respect to such contract
or lease. Notwithstanding anything to the contrary in such contract or lease, or
any other document, the Cure Costs set forth in the Potential Assumption and
Assignment Notice or Supplemental Assumption and Assignment Notice shall be
controlling and will be the only amount necessary to cure outstanding defaults
under the applicable Assumed Contract or Assumed Lease under section 365(b) of
the Bankruptcy Code as of the date of the Bidding Procedures Order, whether
known or unknown, whether due or to become due, whether accrued, absolute,
contingent, or otherwise.

 

[Remainder of This Page Intentionally Left Blank]

 

 3 

 

Dated:[·], 2020
Houston, Texas

   

Respectfully submitted,

 

NORTON ROSE FULBRIGHT US LLP

 

 

/s/ Draft                                                

William R. Greendyke (SBT 08390450)

Jason L. Boland (SBT 24040542)

Robert B. Bruner (SBT 24062637)

Julie Goodrich Harrison (SBT 24092434)

1301 McKinney Street, Suite 5100

Houston, Texas 77010-3095

Tel.: (713) 651-5151

Fax: (713) 651-5246

william.greendyke@nortonrosefulbright.com

jason.boland@nortonrosefulbright.com

bob.bruner@nortonrosefulbright.com

julie.harrison@nortonrosefulbright.com

 

-and-

 

     

DAVIS POLK & WARDWELL LLP

 

Brian M. Resnick (admitted pro hac vice)

Elliot Moskowitz (admitted pro hac vice)

Steven Szanzer (admitted pro hac vice)

Nate Sokol (admitted pro hac vice)

450 Lexington Avenue

New York, New York 10017

Tel.: (212) 450-4000

Fax: (212) 701-5800
brian.resnick@davispolk.com
elliot.moskowitz@davispolk.com

steven.szanzer@davispolk.com

nathaniel.sokol@davispolk.com

 

 

Counsel to the Debtors and Debtors in Possession

 

 

 1