Vyaire Medical - SFDC Cure Obj (final)(33527120.3)
- Date
- 2024-09-10
Summary
A limited objection and reservation of rights filed September 10, 2024 by creditor Salesforce, Inc. as Doc 513 in In re Vyaire Medical, Inc., et al., Case No. 24-11217 (BLS), a jointly administered Chapter 11 case in the U.S. Bankruptcy Court for the District of Delaware. It objects to the proposed assumption and assignment of the Salesforce Contracts and cure costs listed in the Debtors' notices at D.I. 256 and 462. Salesforce asks for findings that a cure amount of not less than US $277,052.76 was due and unpaid as of September 6, 2024, plus later defaults, and for terms on revised cure notices, adequate assurance from any assignee, rejection, administrative expenses and transition services. The background recounts the June 9, 2024 petition date and the sale procedures. The 18-page filing is signed by counsel from White and Williams LLP and Bialson, Bergen & Schwab.
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Case 24-11217-BLS Doc 513 Filed 09/10/24 Page 1 of 18
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
In re: Chapter 11
VYAIRE MEDICAL, INC., et al.,1 Case No. 24-11217 (BLS)
Debtors.
(Jointly Administered)
Re: D.I. 256, 462
LIMITED OBJECTION OF SALESFORCE, INC. TO THE PROPOSED ASSUMPTION
AND ASSIGNMENT OF CERTAIN EXECUTORY CONTRACTS AND CURE COSTS,
IN CONNECTION WITH THE SALE AND RESERVATION OF RIGHTS
Salesforce, Inc. (f/k/a salesforce.com, inc.) (“Salesforce”), by and through their
undersigned counsel, hereby files its limited objection and reservation of rights (the “Assumption
and Assignment Objection”)2 to the assumption and assignment of the executory contracts (the
“Salesforce Contracts”)3 by and between Salesforce and the above-captioned debtors and
debtors-in-possession (the “Debtors”) pursuant to (A) the applicable Assumption and Assignment
Notices4 filed by the Debtors; (B) any plan of reorganization and any supplemental pleadings filed
1
The last four digits of Debtor Vyaire medical, Inc.’s federal tax identification number are 6495. A complete list of
each of the Debtors in these chapter 11 cases and each such Debtor’s federal tax identification number may be
obtained on the website of the Debtors’ claims and noticing agent at https://omniagentsolutions.com/Vyaire. The
location of Debtor Vyaire Medical, Inc.’s principal place of business and the Debtors’ service address in these
chapter 11 cases is 26125 North Riverwoods Boulevard, Mettawa, Illinois, USA 60045.
2
Defined Terms used in this Assumption and Assignment Objection, but which are not specifically defined herein,
shall have the meanings ascribed to them in the Ramirez Declaration filed concurrently herewith.
3
The Salesforce Contract means (A) the agreements and orders identified on Exhibit “A” incorporated in the Ramirez
Declaration filed concurrently herewith and (B) any and all additional agreements and orders that hereinafter are
determined to be executory contracts that must be assumed by the Debtors pursuant to the Assumption and
Assignment Notices, any other motion seeking to assume and/or assign executory contracts and/or any plan of
reorganization and/or assigned by the Debtors to any third party in order for the Debtors or their assigns, as
applicable, to realize the same Salesforce Services as currently enjoyed by the Debtors.
4
See First Notice to Contract Parties of Potentially Assumed and Assigned Executory Contracts and Unexpired
Leases [D.I. 256] (“First Cure Notice”) and the First Supplemental Notice of Contract Parties of Potentially
Case 24-11217-BLS Doc 513 Filed 09/10/24 Page 2 of 18
in connection with any plan of reorganization; and/or (C) any motion otherwise filed in the
bankruptcy cases seeking entry of an order approving and authorizing and/or assignment of the
Salesforce Contracts.
This Assumption and Assignment Objection is based on the matters set forth herein, the
Declaration of Kevin Ramirez in Support of the Limited Objection of Salesforce, Inc. to the
Proposed Assumption of Certain Executory Contracts and Cure Costs, and Reservation of Rights
(the “Ramirez Declaration”) filed in support hereof, the files and the records in this case, and
such other and further evidence as may be submitted at or before the trial on this matter.
Salesforce requests that the Court take judicial notice of the pleadings filed in this case and
the facts set forth in the Court’s orders, findings of fact and conclusions of law pursuant to Rule
201 of the Federal Rules of Evidence (as incorporated by Rule 9017 of the Federal Rules of
Bankruptcy Procedure).
RELIEF REQUESTED
Salesforce seeks entry of an Assumption and Assignment Order (or, as applicable, a
Confirmation Order or Sale Order) protecting its rights and interests that includes the following
provisions and relief:
A. Findings of fact stating that: (1) the Salesforce Contracts include several related
agreements that, taken together, constitute an integrated executory contract for purposes of
assumption and assignment of such contract pursuant to 11 U.S.C. §365; (2) the Salesforce
Contracts constitute an executory contract subject to assumption pursuant to any plan of
reorganization, plan supplements, the cure notices filed, and/or any additional assumption , motion,
as applicable; (3) an aggregate monetary default (the “Salesforce Cure Amount”) exists pursuant
Assumed and Assigned Executory Contracts [D.I. 462] (the “Supplemental Cure Notice,” and collectively, with
the First Cure Notice, the “Assumption and Assignment Notices”).
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to the Salesforce Contract, which includes (i) not less than US $277,052.76 that is due and owing,
but unpaid, as of September 6, 2024 (the “Current Monetary Default”) and (ii) such further
monetary default amounts (the “Future Monetary Default”) that may accrue from and after
September 6, 2024 through the date the assumption and assignment of the Salesforce Contract
becomes effective (the “Effective Assumption Date”) and (iii) any and all monetary defaults
(collectively, the “Additional Salesforce Contract Monetary Defaults”) that may accrue through
the Effective Assumption Date, but which remain unpaid as of that date, with respect to any and all
agreements and orders not currently listed on the Cure Notice but which hereafter are identified as
executory contracts that may be assumed and assigned (the “Additional Salesforce Contracts”)
and any executory contracts subject to the reservation of rights provisions of this Assumption and
Assignment Objection5 (i.e. the Excluded Contracts, as defined herein).
B. The requirement that, as a condition of approving and authorizing the assumption of
the Salesforce Contracts, an additional Salesforce Contract and/or an excluded contract
(collectively, referred to as the “Collective Salesforce Contracts”), the Debtors shall: (1) prepare
an updated schedule (the “Revised Cure Notice”) identifying (a) any and all agreements and orders
(including, without limitation, all of the Collective Salesforce Contracts) that they seek to assume
pursuant to the Plan, the Cure Notice, and/or any Additional Assumption Motion and (b) the
monetary defaults that must be cured with respect to each such contract; (2) file the Revised Cure
Notice with the Court and serve a copy of such notice on Salesforce not later than five (5) business
days prior to the initial hearing at which the Court will consider approval of the assumption of the
Collective Salesforce Contracts; and (3) pay not less than the aggregate monetary defaults due and
owing, but unpaid, with respect to all such contracts through the Effective Assumption Date.
5
See the Reservation of Rights in this Assumption and Assignment Objection concerning such contracts.
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C. The requirement that, if the Salesforce Contract, any Additional Salesforce Contract
and/or any Excluded Contract (1) are assumed pursuant to the Plan and/or an Additional
Assumption Motion and, thereafter, (2) such assumed contract is assigned to a third party who is
not identified in the Plan or the Cure Notice as the prospective assignee (the “Prospective
Assignee”) of such contract (an “Assigned Salesforce Contract”), the Debtors shall (1) identify
the Prospective Assignee of each Assigned Salesforce Contract who will be obligated to perform
all terms and conditions of each such contract and (2) not later than five (5) business days prior to
the initial hearing set to consider approval of the assignment of such contract to such Prospective
Assignee, provide adequate assurance of the ability of the Prospective Assignee to perform all terms
and conditions of the Assigned Salesforce Contract (including, without limitation, payment of the
Salesforce Cure Amount, the extension period fees (if any), the renewal contract fees (if any) and
any and all other amounts due in conjunction with the Assigned Salesforce Contract).
D. The requirement that, in the event the Salesforce Contracts, any Additional
Salesforce Contract and/or any Excluded Contract is not assumed, the Court shall enter an order (a
“Rejection Order”): (1) approving the rejection of each such contract, as applicable, (individually,
a “Rejected Contract” and, collectively, the “Rejected Contracts”); (2) specifying the date
rejection of each Rejected Contract shall be effective (the “Effective Rejection Date”); (3)
terminating the automatic stay imposed by 11 U.S.C. §362 (the “Stay”) as it pertains to each
Rejected Contract; (4) authorizing, but not requiring, Salesforce to terminate the each Rejected
Contract, without further order of the Court; (5) terminating any and all obligations of Salesforce
to provide any services to the Debtors (including, without limitation, the Salesforce Transition
Services as identified hereinafter) pursuant to each Rejected Contract, from and after the Effective
Rejection Date; and (6) ordering that all requested relief shall be effective with respect to each
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Rejected Contract on the Effective Rejection Date without (i) Salesforce being required to file a
separate motion seeking termination of the Stay and/or any of the Rejected Contracts or (ii) the
Court entering any order (other than the Rejection Order).
E. The requirement that, pursuant 11 U.S.C. §§503 and 507, the Debtors and their
respective bankruptcy estates (collectively, the “Bankruptcy Estates”) shall pay all amounts due
with respect to all services and/or goods (the “Salesforce Administrative Expense”) provided to
the Bankruptcy Estates from and after the Petition Date through the latter of, as applicable, (1) the
Effective Assumption Date or (2) in the event the Salesforce Contract is rejected, through the
Effective Rejection Date.
F. The requirement that, in the event the (1) the Debtors sell, convey and/or transfer
some or all of their assets and/or business operation(s) (a “Transaction”) to any third party (a
“Buyer”) pursuant to the Plan, a Confirmation Order, a Sale Order or any other order entered by
the Court, as applicable, and (2) the Debtors and/or Buyers request that any services be provided
by Salesforce (the “Transition Services”) to the Debtors, their Bankruptcy Estates and/or the
Buyer in connection with the Transaction pursuant to (a) an agreement (a “Transition Services
Agreement”) by and between the Debtors (as debtors in possession) or other authorized
representative of the Bankruptcy Estates and the Buyer (the “Transition Service Parties”) or (b)
a Court order, (3) the Court shall enter an order (a “Transition Services Order”): (a) requiring
Debtors and their Bankruptcy Estates or the Buyer, as applicable, to pay any and all amounts that
are due and owing (the “Transition Services Claim”) with respect to such Transition Services
provided from and after Petition Date to the later of (i) the date the Transition Services Agreement
expires or (ii) the date such Transition Services cease to be provided (each such date constitutes
the “Transition Services Expiration Date”) and (b) specifying the obligation to provide
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Transition Services shall terminate on Transition Services Expiration Date unless the Transition
Services Order specifically provides that: (i) Salesforce, in its sole discretion, may agree, but is
not required, to provide such Transition Services after the Transition Services Expiration Date (the
“Extended Transition Service Period”) on such terms and conditions as required by Salesforce,
(ii) the Debtors, the Bankruptcy Estates, or the Buyer, as applicable, are liable for payment of all
amounts due for the Transition Services provided during the Extended Transition Service Period
(the “Post-Rejection Services Obligation”), and (iii) payment of the Post-Rejection Services
Obligation does not constitute a waiver or release of Salesforce’s rights to payment of the
Transition Services Claim or derogate Salesforce’s right to payment of all amounts due with
respect to any and all services and/or goods provided from and after the Petition Date through the
end of either the Transition Services Expiration Date or the Extended Transition Services Period;
G. Approval of the Salesforce Reservation of Rights (as set forth hereinafter); and
H. Granting such other relief as may be just and proper under the facts and circumstances
of the Bankruptcy Cases.
BACKGROUND
1. Salesforce is a Delaware corporation, and, among other activities, it provides on-
demand customer relationship management and software application services (collectively, the
“Salesforce Services”) to Salesforce’s business customers (individually, a “Salesforce
Customer” and, collectively, “Salesforce Customers”).
THE SALESFORCE CONTRACT
2. Salesforce provides the Salesforce Services pursuant to the agreements and orders
identified on Exhibit “A” attached to the Ramirez Declaration (collectively, the “Salesforce
Contracts”) and Exhibit “A” is incorporated by referenced into this Assumption and Assignment
Objection as if fully set forth herein.
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3. The Debtors entered into those certain Salesforce Contracts and pursuant to the
Salesforce Contracts: (i) the Debtors ordered certain Salesforce Services and became obligated
to pay in full the aggregate amounts due pursuant to this contract with respect to such services;
(ii) Salesforce became obligated to provide Salesforce Services to the Debtors; (iii) Salesforce
have provided such services to the Debtors; and (iv) the Debtors accepted and utilized Salesforce
Services provided pursuant to the Salesforce Contracts.
THE BANKRUPTCY CASE
4. On June 9, 2024, (the “Petition Date”) Vyaire Medical, Inc. and the above
captioned 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 District of Delaware (the “Court”) and,
thereby, commenced their individual cases under chapter 11 (collectively, the “Bankruptcy
Cases”). On June 11, 2024, the Court entered the Joint Administration Order6 directing the joint
administration of the Debtors’ cases.
5. On or about July 11, 2024, the Court entered an order (the “Sale Procedures
Order”)7 authorizing the Debtors to establish procedures for sale of certain of the Debtors’ assets
and procedures related to the assumption, assumption and assignment, and/or transfer of executory
contracts and unexpired leases in connection with a sale of the Debtors’ assets.
6. On or about July 11, 2024, the Court entered an order (the “Sale Order”)8 authorizing
6
See, Order (I) Directing Joint Administration of Chapter 11 Cases And (II) Granting Related Relief [D.I. 84] (the
“Joint Administration Order”).
7
See, Order (I) Approving Bidding Procedures and Bid Protections, (II) Scheduling Certain Dates and Deadlines
with Respect Thereto, (III) Approving the Form and Manner of Notice Thereof, (IV)Establishing Notice and
Procedures for the Assumption and Assignment of Contracts and Leases, (V) Authorizing the Assumption and
Assignment of Contracts and Leases, (VI) Authorizing the Sale of Assets; and (VII) Granting Related Relief [D.I.
249] (the “Sale Procedures Order”).
8
See, Order (I) Authorizing and Approving Procedures to Reject Executory Contracts and Unexpired Leases and (II)
Granting Related Relief [D.I. 250]. (the “Sale Order”).
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Case 24-11217-BLS Doc 513 Filed 09/10/24 Page 8 of 18
the sale of certain of the Debtors’ assets and the assumption, assumption and assignment, and/or
transfer of executory contracts and unexpired leases in connection with a sale of the Debtors’ assets.
7. On or about July 11, 2024, pursuant to the Sale Procedures Order, the Debtors filed
the First Cure Notice. Salesforce informally objected to the First Cure Notice and the Debtors
agreed to modify the contract descriptions, and the Debtors and Salesforce agreed upon the correct
cure amount of US $277,052.76.
8. On August 24. 2024, the Debtors filed the Supplemental Cure Notice (collectively,
with the First Cure Notice, the “Assumption and Assignment Notices”).
9. The Assumption and Assignment Notices filed by the Debtors identify: (A) certain
Contracts that the Debtors have designated for assumption and assignment including the following
executory contracts to which Salesforce are counterparties (the “Cure Notices Contracts”), and
(B) the amount of any monetary default (the “Debtors’ Proposed Cure Amount”) that it contends
must be cured as a condition of the assumption of these Cure Notices Contracts:
First Cure Notice (D.I. 256, filed July 11, 2024).
CONSOLIDATE VENDOR/ PROPOSED
VENDOR AGENCY/ WORKS CURE ASSUMPTION
NO. NAME COMPANY DESCRIPTION TREAM AMOUNT ASSIGNEE DATE
6235 SFDC SFDC SalesForce 2017‐07‐14 IT Master Service $267,052.43 7/11/2024
6236 SFDC SFDC Salesforce.com, Inc. 2020‐08‐14‐2020 $ 0.00 7/11/2024
SFDC SFDC Salesforce.com, Inc. 2020‐07‐16 Order $ 0.00 7/11/2024
6237 For
6238 SFDC SFDC Salesforce 2017‐07‐17 IT Order $ 0.00 7/11/2024
6239 SFDC SFDC Purchase Order PO PS 070689 $ 0.00 7/11/2024
6240 SFDC SFDC Purchase Order PO PS 070690 $ 0.00 7/11/2024
6241 SFDC SFDC Purchase Order Quote Q‐07416306 $ 0.00 7/11/2024
6242 SFDC SFDC Purchase Order Quote Q‐07764587 $ 0.00 7/11/2024
Supplemental Cure Notice (D.I. 462, filed August 24, 2024).
CONSOLIDATE VENDOR/ PROPOSED
VENDOR AGENCY/ WORKS CURE ASSUMPTION
NO. NAME COMPANY DESCRIPTION TREAM AMOUNT ASSIGNEE DATE
8265 SFDC SFDC Purchase Order Quote Q-07842041 $ 0.00 8/24/2024
8266 SFDC SFDC Purchase Order Quote Q-07187278 $ 0.00 8/24/2024
8267 SFDC SFDC Purchase Order Quote Q-07114790 $ 0.00 8/24/2024
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10. The Supplemental Cure Notice states that counterparties to the Cure Notices
Contracts must file an objection to the proposed assumption and assignment of the Cure Notices
Contracts (including to the proposed Cure Amount) no later than September 6, 2024. The Debtors
further extended Salesforce’s objection deadline to September 13, 2024 (the “Assumption and
Assignment Objection Deadline”).
THE CURE AMOUNT
11. Salesforce submits that: (A) the Cure Notices Contracts scheduled on the
Assumption and Assignment Notices do not match the description of the Salesforce Contracts as
listed on Salesforce’ records9; (B) the Salesforce Contracts are correctly identified on the Cure
Amount Summary attached to the Ramirez Declaration as Exhibit “A” and incorporated herein by
this reference; and (C) as of the filing date of the Assumption and Assignment Objection,
Salesforce’ records show that the Debtor has failed to pay all amounts due and owing pursuant to
the Salesforce Contracts and, accordingly, the Debtor must cure the aggregate amount of not less
than US $277,052.76 (the “Salesforce Cure Amount”) with respect to Salesforce Services, and
such amount must be paid by the Debtor as a condition of the assumption of the Salesforce
Contracts.
12. Additionally, with respect to the Salesforce Services to be provided in the future,
not less than an aggregate amount of US $19,327.03 (i.e., the Future Payments) will become due
and owing pursuant to the Salesforce Contracts.
13. Because the Assumption and Assignment Notices do not correctly identify all the
potentially assumable contracts to which Salesforce is a counterparty, it is possible that the
9
Accordingly, the Salesforce Assumption and Assumption Objection requests the Debtors provide further
information concerning all of the Orders, and any professional service agreement and/or master subscription
agreement that they propose may be assumed pursuant to the Sale.
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33527120v.2
Case 24-11217-BLS Doc 513 Filed 09/10/24 Page 10 of 18
Salesforce Contracts cure amount may be increased once all executory contracts to be assumed are
determined by Salesforce and the Debtors. Further, it is possible that the Salesforce Cure Amount
may be increased once executory contracts to be assumed are determined by Salesforce, the Debtor
and the Buyer.10
GROUNDS FOR THE RELIEF REQUESTED
The Salesforce Contract Constitutes an Integrated Contract
That Must Be Assumed in Its Entirety
14. Pursuant to the U.S. Bankruptcy Code, a debtor-in-possession has the power, with
court approval, to assume or reject any executory contract or unexpired lease. 11 U.S.C.
§365(b)(1)(A). As a practical matter, a commercial relationship often includes several agreements
that, taken together, constitute an integrated contract. The threshold issue for a court in
determining whether to approve the assumption of an executory contract is to identify all the
agreements that constitute the “executory contract” at issue. Lewis Bros. Bakeries, Inc. v.
Interstate Brands Corp. (In re Interstate Bakeries Corp.), 751 F.3d 955, 961 (8th Cir.2014) (To
determine the applicability of §365, the Court “must first identify what constitutes the agreements
at issue.”)
15. If, as is the situation with respect to the Salesforce Contracts, several agreements
between the parties exist “it is well-settled that state law governs whether the agreements are
separate or indivisible for purposes of §365.” In re New York Skyline, Inc., 432 B.R. 66, 77 (Bankr.
S.D.N.Y. 2010) (applying New York state law); In re Adelphia Bus. Solutions, Inc., 322 B.R. 51,
55 (Bankr. S.D.N.Y. 2005) (applying Missouri state law); Fuentes v. TMCSF, Inc., 26 Cal. App.
10
By the Salesforce Assumption and Assignment Objection, Salesforce reserves all rights with respect to each
executory contract not identified in the Cure Notice but that, ultimately, the Debtors seek to assume and/or assign
pursuant to the Sale and Assumption Motion, any other motion, or any plan of reorganization.
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5th 541, 548, 237 Cal. Rptr. 3d 256, 261 (Ct. App. 2018) (applying California law).
16. In determining whether a series of agreements constitute an integrated contract or
separate contracts, the intention of the parties is the first and foremost factor considered by a court.
See e.g., Pirinate Consulting Corp, LLC v. C.R. Meyer & Sons, Co. (In re Newpage Corporation),
2017 WL 571478 (Bankr. Del., Feb. 13, 2017); In re Buffets Holdings, Inc., 387 B.R. 115, 120
(Bankr. D. Del. 2008). This determination is made by analyzing the plain language of the Master
Agreement between the parties. Carlisle Corp. v. Uresco Const. Materials, Inc., 823 F. Supp. 271,
274 (M.D. Pa. 1993); Fuentes v. TMCSF, Inc., 26 Cal. App. 5th at 548, 237 Cal. Rptr. 3d at 261
(Ct. App. 2018) citing (Goodman v. Severin (1969) 274 Cal.App.2d 885, 895, 79 Cal.Rptr. 555.)
“[T]o determine and effectuate the intent of the parties, and the primary source for identifying this
intent is the language of the contract itself.” Wash. Metro. Area Transit Auth. v. Potomac Inv.
Props., Inc., 476 F.3d 231 (4th Cir. 2007).
17. Where multiple agreements are intended to comprise one contract or transaction, a
party may not sever them for purposes of assumption or rejection. “[A]ll of the contracts that
comprise an integrated agreement must be either assumed or rejected, since they all make up one
contract.” In re LG Philips Displays USA, Inc., No. 06–10245(BLS), 2006 WL 1748671, at *4
(Bankr. D. Del. June 21, 2006).
18. In the matter before this Court, the MSAs that comprise part of the integrated
Salesforce Contract, expressly provide that the governing law is California state law.11 Salesforce
submits that, pursuant to the applicable California law, the Salesforce Services are provided
pursuant to the Order Forms and the MSA, and these agreements are intended to provide the
11
See §12.9, §13.1, §23 and Clause 9 of the applicable MSAs. As previously noted, due to the confidentiality
provisions of the MSAs, a copy of the Salesforce Contract is not attached to my declaration. However, subject to
appropriate non-disclosure protections, a copy of the Salesforce Contract will be made available to the Debtors and
the Committee.
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Debtors with a comprehensive set of services and functionality. In short, Salesforce submits that
all the agreements identified as the Salesforce Contract constitute an integrated contract under
California law.
All Defaults Under an Assumed Contract Must Be Cured
19. Where (as in the case before the Court) the debtor has defaulted on an executory
contract, the Bankruptcy Code prohibits the debtor from assuming the contract unless the debtor:
(A) cures, or provides adequate assurance that the [debtor] will promptly cure, such
default . . . .
(B) compensates, or provides adequate assurance that the [debtor] will promptly
compensate, a party other than the debtor to such contract or lease, for any actual
pecuniary loss to such party resulting from such default; and
(C) provides adequate assurance of future performance under such contract or lease.
See 11 U.S.C. §365(b)(1)(A).
20. “Once an assumption order is entered, the creditor must perform in accordance with
the terms of the assumed agreements. . . In other words, the debtor must cure all defaults, assure
future performance, and make the other contracting party whole before it may be permitted to
assume the agreement.”. In re Kiwi Intern. Air Lines, Inc., 344 F.3d 311, 318 (3rd Cir. 2003)
(emphasis added); In re Columbia Gas System Inc., 50 F.3d 233, 238–39 (3d Cir.1995) (“[T]he
Bankruptcy Code provides that the cost of performing the debtor's obligations is an administrative
expense of the estate. . . .”).
21. Salesforce submits that, with respect to the Salesforce Contract, the Debtors are
obligated to cure all monetary defaults – that is, the Salesforce Cure Amount (in the amount of
$277,052.76) – in full as a condition of assumption and assignment of the Salesforce Contract
pursuant to 11 U.S.C. §365(b)(1)(A).
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RESERVATION OF RIGHTS
22. Salesforce does not object to assumption and assignment of the Salesforce Contract
provided that the Assumption and Assignment Order includes the provisions and relief requested by
the Assumption and Assignment Objection.
23. Salesforce hereby expressly reserves (the “Salesforce Reservation of Rights”) all
rights, interests, claims, counterclaims, rights of setoff and recoupment and/or defenses pertaining to
any or all such contracts including, without limitation: (1) with respect to any and all other Excluded
Contracts: (a) the right to object to the assumption and/or assignment by the Debtors of any Excluded
Contract, (b) the right to payment of all monetary defaults and the cure of all non-monetary defaults
that exist with respect to each Excluded Contract, (c) the right to assert any Cure Costs due and owing
with respect to each any Excluded Contract that hereinafter are designated for assumption and
assignment by the Debtors, and/or (d) the right to have the assignment of any Excluded Contract
specifically conditioned on the Court finding, based on competent evidence, that the actual assignee of
each such contract is capable of performing all terms and conditions of such contract including, without
limitation, payment of all amounts that will come due and owing subsequent to any such assignment;
and (2) in the event the Salesforce Contract is assigned to a third party through a sale of assets, a
plan of reorganization or otherwise: (a) the right to object to the assumption and/or assignment by
the Debtors of any such contract, and/or (b) the right to have the assignment of any such contract
specifically conditioned on the Court finding, based on competent evidence, that the actual assignee of
such contract is capable of performing all terms and conditions of such contract including, without
limitation, payment of all amounts that will come due and owing subsequent to any such assignment.
WHEREFORE, if the Court determines to approve assumption of any of the Salesforce
Contracts, Salesforce requests entry of an Assumption and Assignment Order (or a Confirmation
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Order and/or Sale Order, as applicable) protecting Salesforce’s rights and interests by including
the following findings of facts and relief in such order:
A. Findings of fact stating that: (1) the Salesforce Contracts includes several related
agreements that, taken together, constitute an integrated executory contract for purposes of
assumption and assignment of such contract pursuant to 11 U.S.C. §365; (2) the Salesforce
Contracts constitutes an executory contract subject to assumption; (3) the Salesforce Cure Amount
that must be paid as a condition of the assumption of the Salesforce Contracts includes (i) not less
than $277,052.76 that is due and owing, but unpaid, as of September 6, 2024 and (ii) such Future
Monetary Default that may accrue from and after September 6, 2024 through the Effective
Assumption Date and (iii) any Additional Salesforce Contract Monetary Default that may accrue
through the Effective Assumption Date of an Additional Salesforce Contract and/or Excluded
Contract, but which remain unpaid as of that date, with respect to any and all such contracts that
hereafter are assumed.
B. The requirement that, as a condition of approving and authorizing the assumption
of any of the Salesforce Contracts, the Debtors shall: (1) prepare a Revised Cure Notice identifying
(a) any and all agreements and orders that they seek to assume pursuant to the Plan, the Cure
Notice, and/or any Additional Assumption Motion and (b) the monetary defaults that must be cured
with respect to each such contract; (2) file the Revised Cure Notice with the Court and serve a
copy of such notice on Salesforce not later than five (5) business days prior to the initial hearing
at which the Court will consider approval of the assumption of the Collective Salesforce Contracts;
and (3) pay not less than the aggregate monetary defaults due and owing, but unpaid, with respect
to all such contracts through the Effective Assumption Date;
C. The requirement that, if any Salesforce Contract, any additional Salesforce Contract
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and/or any Excluded Contract is assumed pursuant to the Plan and/or an Additional Assumption
Motion and, thereafter, such assumed contract is assigned to a third party who is not identified in
the Plan or the Cure Notice as the Prospective Assignee of such Assigned Salesforce Contract,
the Debtors shall (1) identify the Prospective Assignee of each Assigned Salesforce Contract
who will be obligated to perform all terms and conditions of each such contract and (2) not later
than five (5) business days prior to the initial hearing set to consider approval of the assignment
of such contract to such Prospective Assignee, provide adequate assurance of the ability of the
Prospective Assignee to perform all terms and conditions of the Assigned Salesforce Contract
(including, without limitation, payment of the Salesforce Cure Amount, the extension period
fees (if any), the renewal contract fees (if any) and any and all other amounts due in conjunction
with the Assigned Salesforce Contract).
D. The requirement that, in the event the Salesforce Contract, any Additional
Salesforce Contract and/or any Excluded Contract is not assumed, the Court shall enter a Rejection
Order: (1) approving the rejection of each Rejected Contract; (2) specifying the Effective Rejection
Date applicable to each Rejected Contract; (3) terminating the Stay as it pertains to each Rejected
Contract; (4) authorizing, but not requiring, Salesforce to terminate the each Rejected Contract,
without further order of the Court; (5) terminating any and all obligations of Salesforce to provide
any services to the Debtors (including, without limitation, the Salesforce Transition Services)
pursuant to each Rejected Contract, from and after the Effective Rejection Date; and (6) ordering
that all requested relief shall be effective with respect to each Rejected Contract on the Effective
Rejection Date without (i) Salesforce being required to file a separate motion seeking termination
of the Stay and/or any of the Rejected Contracts or (ii) the Court entering any order (other than the
Rejection Order);
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Case 24-11217-BLS Doc 513 Filed 09/10/24 Page 16 of 18
E. The requirement that, pursuant 11 U.S.C. §§503 and 507, the Debtors and the
Bankruptcy Estates shall pay all Salesforce Administrative Expense due with respect to all services
and/or goods the provided to the Bankruptcy Estates from and after the Petition Date through the
latter of, as applicable, (1) the Effective Assumption Date or (2) in the event the Salesforce
Contract is rejected, through the Effective Rejection Date.
F. The requirement that, in the event the (1) the Debtors enter into a Transaction with
any Buyer pursuant to the Plan, a Confirmation Order, Sale Order or other order entered by the
Court, as applicable, and (2) the Debtors and/or Buyers request that any Transition Services be
provided by Salesforce to the Debtors, their Bankruptcy Estates and/or the Buyer in connection
with the Transaction pursuant to (a) a Transition Services Agreement by and between Transition
Service Parties or (b) a Court order, (3) the Court shall enter its Transition Services Order: (a)
requiring Debtors and their Bankruptcy Estates or the Buyer, as applicable, to pay in full the
Transition Services Claim with respect to such Transition Services provided from and after Petition
Date to the Transition Services Expiration Date and (b) specifying the obligation to provide
Transition Services shall terminate on Transition Services Expiration Date unless the Transition
Services Order specifically provides that: (i) Salesforce, in its sole discretion, may agree, but is
not required, to provide such Transition Services during the Extended Transition Service Period
on such terms and conditions as required by Salesforce, (ii) the Debtors, the Bankruptcy Estates,
or the Buyer, as applicable, are liable for payment of the Post-Rejection Services Obligation, and
(iii) payment of the Post-Rejection Services Obligation does not constitute a waiver or release of
Salesforce’s rights to payment of the Transition Services Claim or derogate Salesforce’s right to
payment of all amounts due with respect to any and all services and/or goods provided from and
after the Petition Date through the end of either the Transition Services Expiration Date or the
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Case 24-11217-BLS Doc 513 Filed 09/10/24 Page 17 of 18
Extended Transition Services Period;
G. Approval of the Salesforce Reservation of Rights; and
H. Granting such other relief as may be just and proper under the facts and circumstances
of the Bankruptcy Cases.
[Remainder of Page Intentionally Left Blank.]
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Case 24-11217-BLS Doc 513 Filed 09/10/24 Page 18 of 18
Dated: September 10, 2024 Respectfully submitted,
Wilmington, Delaware
WHITE AND WILLIAMS LLP
/s/ Michael Ingrassia
Michael Ingrassia (No. 7068)
600 North King Street, Suite 800
Wilmington, DE 19801
Phone: 302-467-4503
Fax: 302-467-4550
Email: ingrassiam@whiteandwilliams.com
-and-
WHITE AND WILLIAMS LLP
Amy E. Vulpio, Esquire
1650 Market Street, Suite 1800
One Liberty Place
Philadelphia, PA 19103-7395
Telephone: (215) 864-6250
Facsimile: (215) 789-7550
Email: vulpioa@whiteandwilliams.com
-and-
BIALSON, BERGEN & SCHWAB,
A Professional Corporation
Gaye Nell Heck, Esq.
Thomas M. Gaa, Esq.
830 Menlo Avenue, Suite 201
Menlo Park, CA 94025
Telephone: (650) 857-9500
Fax: (650) 494-2738
E-mail: Tgaa@bbslaw.com
Gheck@bbslaw.com
Attorneys for Creditor Salesforce, Inc.
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