IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF ...

[Pages:11]Case 21-32155 Document 132 Filed in TXSB on 07/26/21 Page 1 of 7

IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION

IN RE: BUCKINGHAM SENIOR LIVING COMMUNITY, INC.1

Debtor.

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CASE NO. 21-32155 (MI)

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CHAPTER 11

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DEBTOR'S MOTION TO ESTABLISH PROCEDURES FOR MONTHLY AND INTERIM COMPENSATION AND REIMBURSEMENT OF EXPENSES

THIS MOTION SEEKS AN ORDER THAT MAY ADVERSELY AFFECT YOU. IF YOU OPPOSE THE MOTION, YOU SHOULD IMMEDIATELY CONTACT THE MOVING PARTY TO RESOLVE THE DISPUTE. IF YOU AND THE MOVING PARTY CANNOT AGREE, YOU MUST FILE A RESPONSE AND SEND A COPY TO THE MOVING PARTY. YOU MUST FILE AND SERVE YOUR RESPONSE WITHIN 21 DAYS OF THE DATE THIS WAS SERVED ON YOU. YOUR RESPONSE MUST STATE WHY THE MOTION SHOULD NOT BE GRANTED. IF YOU DO NOT FILE A TIMELY RESPONSE, THE RELIEF MAY BE GRANTED WITHOUT FURTHER NOTICE TO YOU. IF YOU OPPOSE THE MOTION AND HAVE NOT REACHED AN AGREEMENT, YOU MUST ATTEND THE HEARING. UNLESS THE PARTIES AGREE OTHERWISE, THE COURT MAY CONSIDER EVIDENCE AT THE HEARING AND MAY DECIDE THE MOTION AT THE HEARING.

REPRESENTED PARTIES SHOULD ACT THROUGH THEIR ATTORNEY.

TO THE HONORABLE UNITED STATES BANKRUPTCY JUDGE:

Buckingham Senior Living Community, Inc. ("The Buckingham" or the "Debtor") files

this Debtor's Motion to Establish Procedures for Monthly and Interim Compensation and

1 The last four digits of the Debtor's federal tax identification number are: 7872. The location of the Debtor's principal place of business and the service address for the Debtor is: 8580 Woodway Drive Houston, Texas 77063.

MOTION TO ESTABLISH MONTHLY AND INTERIM COMPENSATION PROCEDURES

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Reimbursement of Expenses (the "Motion"). In support of the Motion, the Debtor respectfully represents:

RELIEF REQUESTED 1. Pursuant to Bankruptcy Code section 331 and Bankruptcy Rule 2016(a), the Debtor requests that this Court enter an order substantially in the form of Exhibit A (the "Order") establishing procedures for compensating and reimbursing the professionals employed in this Case (the "Professionals") on a monthly basis and interim basis.

JURISDICTION AND VENUE 2. This Court has jurisdiction over this matter pursuant to 28 U.S.C. ? 1334. This matter is a core proceeding pursuant to 28 U.S.C. ? 157(b). 3. Venue is proper pursuant to 28 U.S.C. ?? 1408 and 1409. 4. The statutory predicate for relief requested in this Motion is 11 U.S.C. ? 331, as complemented by Rule 2016 of the Federal Rules of Bankruptcy Procedure (the "Bankruptcy Rules"), and the Bankruptcy Local Rules.

PROCEDURAL BACKGROUND 5. On June 25, 2021 (the "Petition Date"), the Debtor commenced this case (the "Case") by filing a voluntary petition under chapter 11 of title 11 of the United States Code (the "Bankruptcy Code"). 6. The Debtor has continued to operate and manage its business and affairs as debtorin-possession, pursuant to Bankruptcy Code ?? 1107 and 1108(a). 7. The Office of the United States Trustee (the "U.S. Trustee") has appointed an Official Committee of Unsecured Creditors (the "Committee") in this Case.

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RELEVANT FACTUAL BACKGROUND 8. Factual information regarding the Debtor, including the Debtor's business and indebtedness and the events leading to this chapter 11 Case is contained in the First Day Declaration. 2 A. Standard for Interim Compensation under Section 331 of the Bankruptcy Code and Bankruptcy Rule 2016(a) 9. Bankruptcy Code section 331 provides that a debtor's attorney, or any professional person employed under section 327 or 1103, may submit applications for interim compensation and reimbursement of expenses "every 120 days . . . or more often if the court permits."3 Bankruptcy Rule 2016(a) provides that the substance of the application must set forth a detailed statement "of (1) the services rendered, time expended and expenses incurred, and (2) the amount requested."4 Furthermore, Bankruptcy Rule 2016(a) requires that the application include "a statement as to what payments have theretofore been made or promised to the applicant for services rendered or to be rendered."5 B. Proposed Compensation Procedures 10. Accordingly, the Debtor seeks approval of procedures providing for the payment of compensation and reimbursement of expenses as follows (the "Compensation Procedures"):

2 The Debtor incorporates by reference the Declaration of Michael Wyse in Support of Voluntary Petition and First Day Motions [Dkt. No. 17], which contains factual information regarding the Debtor and the events precipitating this Case.

3 11 U.S.C. ? 331.

4 Fed. R. Bankr. 2016 (a).

5 Id.

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(a) On or after the 20th day of each month following the month for which compensation is sought, each Professional may serve a monthly fee statement (each, a "Monthly Fee Statement") for interim allowance of compensation for services rendered and reimbursement of expenses incurred during the preceding month, via electronic mail, facsimile, or overnight mail, upon: (a) the Debtor; (b) Debtor's counsel; (c) the U.S. Trustee; (d) counsel for the DIP Lender and the Bond Trustee; and (e) Counsel to the Committee (individually a "Notice Party" and, collectively, the "Notice Parties"). Any Professional that fails to serve a Monthly Fee Statement for a particular month or months may subsequently submit a Monthly Fee Statement that includes a request for compensation earned or expenses incurred during the previous months. All Monthly Fee Statements must comply with the Bankruptcy Code, the Bankruptcy Rules, applicable law, and the Bankruptcy Local Rules.

(b) Each Notice Party receiving a Monthly Fee Statement will have until 4:00 p.m. (Prevailing Central Time) 14 days after service of a Monthly Fee Statement to object to the requested fees and expenses in accordance with subparagraph (d) below. Upon the expiration of the 14-day objection period, the Debtor is authorized and directed to pay the Professional an amount equal to 80 percent of the fees and 100 percent of the out-of-pocket expenses requested in the applicable Monthly Fee Statement that are not subject to an objection pursuant to subparagraph (d) below.

(c) In the event that one of the Notice Parties has an objection to the compensation or reimbursement sought in a particular Monthly Fee Statement, such Notice Party may, within 14 days after the receipt of such Monthly Fee Statement, serve via email a written "Notice of Objection to Monthly Fee Statement" upon the respective Professional and the Notice Parties, with a statement setting forth the precise nature of the objection and the amount at issue. Thereafter, the objecting Notice Party and the Professional shall attempt to reach an agreement regarding the correct payment to be made. If the parties reach an agreement, the Debtor shall promptly pay 80 percent of the agreed-upon fees and 100 percent of the agreed-upon expenses. If, however, the parties are unable to reach an agreement on the objection within 10 days (or such longer period as mutually agreed to by the Professional and the objecting party) after service of the objection, the Professional will have the option of: (i) filing the objection, together with a request for payment of the disputed amount, with this Court; or (ii) foregoing payment of the disputed amount until the next interim fee application hearing, at which time the Court will consider and dispose of the objection if payment of the disputed amount is requested.

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(d) Beginning with the Period ending September 30, 2021, and at three-month intervals thereafter (each, an "Interim Fee Period"), on or after the 45th day following the last day for which compensation is sought, each of the Professionals may file with the Court and serve on the Notice Parties, an interim fee application (an "Interim Fee Application") for compensation and reimbursement of expenses sought during such period. Each Interim Fee Application must include (i) a narrative discussion, (ii) a summary of the Monthly Fee Statements that are the subject of such application request, (iii) the amount of fees and expenses paid of date or subject to objection, and (iv) the deadline for parties other than the Notice Parties to file objections. Each Professional shall serve notice of its Interim Fee Application. The first such Interim Fee Application will be filed by each Professional on or after November 12, 2021 and will cover the period from the Petition Date through September 30, 2021.

(e) A pending objection or Court order stating that payment of compensation or reimbursement of expenses was improper as to a particular Monthly Fee Statement or Interim Fee Application will not disqualify a Professional from future payment of monthly and interim compensation or reimbursement of expenses, except as otherwise directed by a Court Order.

(f) Neither (i) the payment of or failure to pay, in whole or in part, monthly or interim compensation and reimbursement of expenses as provided herein nor (ii) the filing of or failure to file an objection with this Court will bind any party-in-interest or this Court with respect to the final allowance of applications for compensation and reimbursement of Professionals.

11. The procedures proposed herein will: (a) allow the Notice Parties to monitor the

Professionals' fees on a monthly basis; (b) assist the Debtor's management of cash flows; and (c)

ease the burden on the Professionals, whose time commitment is expected to be significant, by

allowing interim payments for their services.

12. As noted above, the U.S. Trustee has appointed the Committee. Accordingly, the

Debtor further requests that each member of the Committee and any other official committee that

may be appointed, if any, be permitted to submit statements of expenses (excluding amounts for

individual members' attorney's fees and expenses) and supporting documentation to counsel for

such official committee. Counsel for any official committee shall collect and serve such requests

for reimbursements in accordance with the proposed Compensation Procedures.

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13. The Debtor further requests that the Court limit service of Interim Fee Applications and final fee applications (each, a "Final Fee Application," and together with Interim Fee Applications, the "Applications") on the Notice Parties. The Debtor further requests that all other parties that have filed a notice of appearance with the Clerk of this Court and requested notice of pleadings in this chapter 11 case shall be entitled to receive only notice of hearings on the Applications (a "Hearing Notice"). Serving the Applications and the Hearing Notices in this manner will permit the parties most active in this Case to review and object to the Professionals' fees and will save unnecessary duplication and mailing expenses. Similar procedures regarding notice for Applications have been approved in other large chapter 11 cases in this District.6

14. These Compensation Procedures are appropriate and consistent with interim compensation procedures established in other large chapter 11 cases in this District.7

PRAYER WHEREFORE, the Debtor respectfully requests that this Court enter an order granting the relief requested herein and such other and further relief as this Court may deem proper, both at law and in equity.

6 See, e.g., In re Fieldwood Energy LLC, No. 20-33948 (MI) (Bankr. S.D. Tex. Sept. 17, 2020); In re Approach Resources Inc., No. 19-36555 (MI) (Bankr. S.D. Tex. Dec. 31, 2019); In re iHeartMedia, Inc., No. 18-31274 (MI) (Bankr. S.D. Tex. April 12, 2018); In re EXCO Res., Inc., No. 18-30155 (MI) (Bankr. S.D. Tex. Feb. 22, 2018); In re Cobalt Int'l Energy, Inc., No. 17-36709 (MI) (Bankr. S.D. Tex. Jan. 11, 2018); In re Seadrill Ltd., No. 17-60079 (DRJ) (Bankr. S.D. Tex. Nov. 1, 2017); In re GenOn Energy, Inc., No. 17-33695 (DRJ) (Bankr. S.D. Tex. July 13, 2017).

7 See, e.g., In re J.C. Penney Company, Inc., No. 20-20182 (DRJ) (Bankr. S.D. Tex. July 8, 2020); In re Geokinetics, Inc., No. 18-33410 (DRJ) (Bankr. S.D. Tex. Jul. 26, 2018); In re Sherwin Alumina Co., LLC, No. 16-20012 (DRJ) (Bankr. S.D. Tex. Feb. 24, 2016); In re BPZ Res., Inc., No. 15-60016 (DRJ) (Bankr. S.D. Tex. Apr. 7, 2015); In re Autoseis, Inc., No. 14- 20130 (RSS) (Bankr. S.D. Tex. Apr. 25, 2014); In re ATP Oil and Gas Corp., No. 12-36187 (MI) (Bankr. S.D. Tex. Sept. 27, 2012).

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DATED: July 26, 2021 Houston, Texas

Respectfully submitted,

MCGUIREWOODS LLP

By: /s/ Demetra Liggins Demetra Liggins State Bar No. 24026844 JPMorgan Chase Tower 600 Travis Street Suite 7500 Houston, TX 77002-2906 Email: DLiggins@ Telephone: (713) 353-6661 Facsimile: (832) 255-6371

PROPOSED COUNSEL FOR DEBTOR AND DEBTOR IN POSSESSION

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Case 21-32155 Document 132-1 Filed in TXSB on 07/26/21 Page 1 of 4

IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION

IN RE: BUCKINGHAM SENIOR LIVING COMMUNITY, INC.1

Debtor.

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?

CASE NO. 21-32155 (MI)

?

?

CHAPTER 11

?

?

?

ORDER ESTABLISHING PROCEDURES FOR MONTHLY AND INTERIM COMPENSATION AND REIMBURSEMENT OF EXPENSES FOR CASE PROFESSIONALS

Having considered Buckingham Senior Living Community, Inc. ("The Buckingham" or

the "Debtor") Debtor's Motion to Establish Procedures for Monthly and Interim Compensation and Reimbursement of Expenses for Case Professionals (the "Motion"),2 and the evidence and

arguments presented at the hearing, if any, the Court finds that: (a) jurisdiction over the matters in

the Motion is proper pursuant to 28 U.S.C. ? 1334; (b) venue is proper in this Court pursuant to

28 U.S.C. ?? 1408 and 1409; (c) proper and adequate notice of the Motion has been provided and

no further notice is needed; (d) the relief sought in the Motion is in the best interests of the Debtor's

estate, its creditors, and all parties-in-interest; and (e) good and sufficient cause exists for granting

the relief requested in the Motion. Accordingly, it is

ORDERED that the Motion hereby is GRANTED. It is further

ORDERED that, except as may otherwise be provided in Court orders authorizing the

retention of specific professionals in this Case, all professionals retained in this case (the

1 The last four digits of the Debtor's federal tax identification number are: 7872. The location of the Debtor's principal place of business and the service address for the Debtor is: 8580 Woodway Drive Houston, Texas 77063.

2 All capitalized terms not defined herein shall have the meaning ascribed to them in the Motion.

ORDER ESTABLISHING MONTHLY AND INTERIM COMPENSATION PROCEDURES

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