in the united states bankruptcy court for the … · to whom it may concern: in accordance with our...

EAST\78476362.1

IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE

--------------------------------------------------------------- In re: RESTORA HEALTHCARE HOLDINGS, LLC, et al.,1

Debtors.

---------------------------------------------------------------

x : :::::: : :x

Chapter 11 Case No. 14-10367 (PJW) (Jointly Administered) Objection Deadline: 7/23/2014 at 4:00 p.m. (ET)

NOTICE OF FILING OF MONTHLY COMPENSATION AND STAFFING REPORT OF ALVAREZ & MARSAL HEALTHCARE INDUSTRY GROUP,

LLC FOR THE PERIOD FROM MAY 1, 2014 THROUGH MAY 31, 2014

PLEASE TAKE NOTICE that on February 28, 2014, the above-captioned debtors and

debtors in possession (collectively, the “Debtors”) filed the Application Of The Debtors To

(I) Retain Alvarez & Marsal Healthcare Industry Group, LLC To Provide The Debtors A Chief

Restructuring Officer And Certain Additional Personnel And (II) Designate George D. Pillari As

Chief Restructuring Officer For The Debtors Nunc Pro Tunc To The Petition Date [Dkt No. 77]

with the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”).

PLEASE TAKE FURTHER NOTICE that on March 19, 2014, the Bankruptcy Court

entered the Order Authorizing The Debtors To (I) Retain Alvarez & Marsal Healthcare Industry

Group, LLC To Provide The Debtors A Chief Restructuring Officer And Certain Additional

Personnel And (II) Designate George D. Pillari As Chief Restructuring Officer For The Debtors

Nunc Pro Tunc To The Petition Date [Dkt. No. 149] (the “A&M Retention Order”).

1 The Debtors in these chapter 11 cases, together with the last four digits of each Debtor’s federal tax

identification number, are: Restora Healthcare Holdings, LLC (2837); Restora Hospital of Mesa, LLC (8773); and Restora Hospital of Sun City, LLC (1028). The mailing address for the Debtors, solely for purposes of notices and communications, is 2550 Northwinds Parkway, Suite 160, Alpharetta, Georgia 30009.

Case 14-10367-PJW Doc 398 Filed 07/02/14 of 3

EAST\78476362.1 2

PLEASE TAKE FURTHER NOTICE that on April 23, 2014, the Bankruptcy Court

entered the Order Approving The Supplemental Application Of The Debtors To (I) Retain

Alvarez & Marsal Healthcare Industry Group, LLC To Provide The Debtors A Chief

Restructuring Officer And Certain Additional Personnel And (II) Designate Certain Additional

Personnel Of Alvarez & Marsal Healthcare Industry Group, LLC As Executive Officers Of The

Debtors Nunc Pro Tunc To March 17, 2014 [Dkt. No. 278] (the “Supplemental A&M Retention

Order” and, together with the A&M Retention Order, the “A&M Retention Orders”).

PLEASE TAKE FURTHER NOTICE that, in accordance with the A&M Retention

Orders, attached hereto as Exhibit A is Alvarez & Marsal Healthcare Industry Group, LLC’s

monthly compensation and staffing report for the period from May 1, 2014 through May 31,

2014 (the “Third Compensation and Staffing Report”).

PLEASE TAKE FURTHER NOTICE that any objections to the Third Compensation

and Staffing Report must be filed in writing with the Bankruptcy Court, 824 Market Street, 3rd

Floor, Wilmington, Delaware 19801, and served upon and received by the following parties on

or before July 23, 2014 at 4:00 p.m. (prevailing Eastern Time): (i) counsel to the Debtors,

DLA Piper LLP (US), 1251 Avenue of the Americas, New York, New York 10020 (Attn:

Thomas R. Califano, Esq. ([email protected]) and Daniel G. Egan, Esq.

([email protected])) and 1201 N. Market Street, Suite 2100, Wilmington, Delaware

19801 (Attn: Stuart M. Brown, Esq. ([email protected]); (ii) Alvarez & Marsal

Healthcare Industry Group, LLC, 100 Pine Street, Suite 900, San Francisco, California 94111,

Attn: George D. Pillari ([email protected]); (iii) counsel to the Official Committee

of Unsecured Creditors, Alston & Bird LLP, 90 Park Avenue, New York, New York 10016

(Attn: Marty Bunin, Esq. ([email protected])) and Morris James LLP, P.O. Box 2306,


EAST\78476362.1 3

Wilmington, Delaware 19899 (Attn: Brett D. Fallon ([email protected])); and (iv) the

Office of the United States Trustee, District of Delaware, 844 King Street, Suite 2207, Lockbox

35, Wilmington, Delaware 19801 (Attn: Benjamin A. Hackman, Esq.

([email protected])).

PLEASE TAKE FURTHER NOTICE that if an objection is properly filed and served

in accordance with the above procedures, all compensation listed in the Third Compensation and

Staffing Report shall be subject to review by the Bankruptcy Court.

Dated: July 2, 2014 DLA PIPER LLP (US) Wilmington, Delaware

/s/ Stuart M. Brown Stuart M. Brown (DE 4050) Daniel N. Brogan (DE 5723) 1201 N. Market Street, Suite 2100 Wilmington, DE 19801 Telephone: (302) 468-5700 Facsimile: (302) 394-2341 Email: [email protected] [email protected]

-and-

Thomas R. Califano (admitted pro hac vice) Daniel G. Egan (admitted pro hac vice) 1251 Avenue of the Americas New York, New York 10020 Telephone: (212) 335-4500 Facsimile: (212) 335-4501 Email: [email protected] [email protected] Attorneys for the Debtors and Debtors in Possession


EAST\78476362.1

EXHIBIT A

Case 14-10367-PJW Doc 398-1 Filed 07/02/14 Page 1 of 14

July 2, 2014 Restora Healthcare Holdings, LLC 2550 Northwinds Parkway Suite 160 Alpharetta, GA 30009 To whom it may concern: In accordance with our engagement letter dated January 16, 2014, and Order Authorizing the Debtors to Retain Alvarez & Marsal Healthcare Industry Group, LLC dated March 19, 2014 [DI #149] attached please find our invoice for the period May 1, 2014 through May 31, 2014. If you have any questions, please feel free to contact me at any time. Very truly yours, George D. Pillari Managing Director Attachment


July 2, 2014 INVOICE #801266A-3

Hours, Fees & Expenses for the period May 1, 2014 through May 31, 2014: Pursuant to our Engagement Letter dated January 16, 2014 and Order Authorizing Employ dated March 19, 2014. Professional Fees:

Hours Rate FeesHealthcare Industry Group, LLC

Restructuring/Operations ManagementRon Winters Managing Director 2.90 $800 2,320.00$ George Pillari Managing Director 1.80 $800 1,440.00 Steven Kraus Director 54.60 $525 28,665.00 Erica Lister Senior Associate 99.50 $425 42,287.50

158.80 74,712.50$ Engagement AdministrationMary Napoliello Paraprofessional 0.00 $250 -

0.00 -$ Bankruptcy/AdvisoryRon Winters Managing Director 1.70 $800 1,360.00$ George Pillari Managing Director 0.70 $800 560.00 Steven Kraus Director 14.30 $525 7,507.50 Erica Lister Senior Associate 5.50 $425 2,337.50

22.20 11,765.00$

86,477.50$

Less reduction -$

86,477.50$ Claims Management

Diligence/ReportingSteve Kotarba Managing Director 5.20 $650 3,380.00$ Jay Herriman Director 0.00 $600 - Kevin Sullivan Director 0.00 $500 - Michael Williams Analyst 0.00 $325 -

5.20 3,380.00$

Total Professional Fees: 89,857.50$

Out of Pocket Expenses: 4,682.54

Invoice Total: 94,540.04$

Detailed Time and Expense Records Attached as Exhibit A & B.

2


Payment Instructions Mailing Instructions: Wire Instructions: Alvarez & Marsal LLC Bank: JP Morgan Chase Attn: Liz Carrington ABA: 0 2 1 0 0 0 0 2 1 600 Madison Avenue Acct Name: Alvarez & Marsal LLC 8th Floor Acct Number: 789 758 026 New York, NY 10022 Reference: 801266A - 3

3


Exhibit A

4


Restora Healthcare Holdings-Time SummaryGeorge Pillari, Managing DirectorHealthcare Industry Group, LLC

Day Date Time Rate Billings Description

Thr 05/01/2014 1.0 $800.00 $800.00 Discussion of cash management and bankruptcy status with counsel.Tue 05/20/2014 0.8 $800.00 $640.00 Follow-up with counsel regarding sale closeWed 05/21/2014 0.7 $800.00 $560.00 Internal review of reforecast budget

2.5 $2,000.00

5


Restora Healthcare Holdings-Time SummaryRon Winters, Managing DirectorHealthcare Industry Group, LLC


Thu 5/1/2014 0.5 $800 $400.00 Conference call with DLA re asset transfer mechanics + funding + reg mattersThu 5/1/2014 0.5 $800 $400.00 Conference call (A&M + HFG) re closing mechanics + fundingThu 5/1/2014 0.2 $800 $160.00 Telephone call (Winters + Kraus) re prep for call with HFGThu 5/1/2014 0.2 $800 $160.00 Review Kraus CHOW period estimates + cashflow; provide commentsMon 5/5/2014 0.3 $800 $240.00 Email advice re PCOFri 5/9/2014 0.3 $800 $240.00 Telephone call (Ronald Winters + Erica Lister) re DIP planningSat 5/10/2014 0.8 $800 $640.00 Review + comment on cashflow projection (e-mail exchange)Mon 5/12/2014 0.8 $800 $640.00 Telephone call (Ronald Winters + Erica Lister) re cash needs for admin-status claimsTue 5/13/2014 0.5 $800 $400.00 Detailed cashflow budget commentsThu 5/15/2014 0.1 $800 $80.00 Email advice to Lister re assumed liabilities (Buyer)Fri 5/16/2014 0.2 $800 $160.00 Telephone call with George Pillari + Lister re budgetFri 5/16/2014 0.2 $800 $160.00 Conference call (A&M + HFG) re cashflow budget + prof fees

4.6 $3,680.00

6


Restora Healthcare Holdings -Time SummaryErica Lister, Senior AssociateHealthcare Industry Group, LLC


Thu 05/01/2014 3.4 $425 $1,445.00 Continued cash/vendor/operations management, review and meeting to discuss budgeting toolFri 05/02/2014 3.6 $425 $1,530.00 Continued cash/vendor/operations management, review and meeting to discuss budgeting tool

Mon 05/05/2014 2.2 $425 $935.00 Continued cash/vendor/operations management, review and meeting to discuss budgeting toolMon 05/05/2014 2.0 $425 $850.00 Discussions regarding PCOTue 05/06/2014 3.6 $425 $1,530.00 Continued cash/vendor/operations management, review and meeting to discuss budgeting toolWed 05/07/2014 2.3 $425 $977.50 Distribution of weekly reportWed 05/07/2014 2.2 $425 $935.00 Continued cash/vendor/operations management, review and meeting to discuss budgeting toolThu 05/08/2014 2.5 $425 $1,062.50 Prep for DIP budget revisionThu 05/08/2014 2.7 $425 $1,147.50 Continued cash/vendor/operations management, review and meeting to discuss budgeting toolFri 05/09/2014 2.3 $425 $977.50 Call and preparation of DIP budget updateFri 05/09/2014 2.3 $425 $977.50 Continued cash/vendor/operations management, review and meeting to discuss budgeting tool

Mon 05/12/2014 2.3 $425 $977.50 Continued cash/vendor/operations management, review and meeting to discuss budgeting toolMon 05/12/2014 2.2 $425 $935.00 Revision of DIP budgetTue 05/13/2014 1.8 $425 $765.00 Continued cash/vendor/operations management, review and meeting to discuss budgeting toolTue 05/13/2014 2.3 $425 $977.50 Distribution of weekly reportTue 05/13/2014 1.1 $425 $467.50 Call to discuss Banner cure objectionsWed 05/14/2014 1.8 $425 $765.00 Continued cash/vendor/operations management, review and meeting to discuss budgeting toolWed 05/14/2014 2.4 $425 $1,020.00 Staff and transition planning with Acuity Wed 05/14/2014 2.0 $425 $850.00 Follow-up with counsel re: sale closeThu 05/15/2014 2.6 $425 $1,105.00 Discussion with Winters re: buyer liabilitiesThu 05/15/2014 2.9 $425 $1,232.50 Continued cash/vendor/operations management, review and meeting to discuss budgeting toolFri 05/16/2014 1.2 $425 $510.00 Internal Call to discuss budget + Call with HFG to present updated budgetFri 05/16/2014 2.4 $425 $1,020.00 Continued cash/vendor/operations management, review and meeting to discuss budgeting tool

Mon 05/19/2014 2.3 $425 $977.50 Continued cash/vendor/operations management, review and meeting to discuss budgeting toolMon 05/19/2014 2.2 $425 $935.00 Review of current electronic data transfer agreements related to PCO activityTue 05/20/2014 1.8 $425 $765.00 Follow-up with counsel re: sale closeTue 05/20/2014 2.3 $425 $977.50 Distribution of weekly reportTue 05/20/2014 1.1 $425 $467.50 503(b)(9) reconciliation and payment strategyWed 05/21/2014 1.8 $425 $765.00 Continued cash/vendor/operations management, review and meeting to discuss budgeting toolWed 05/21/2014 2.4 $425 $1,020.00 Review of AP agings reportsWed 05/21/2014 2.0 $425 $850.00 Follow-up with counsel re: sale closeThu 05/22/2014 2.6 $425 $1,105.00 Follow-up with counsel re: sale closeThu 05/22/2014 2.9 $425 $1,232.50 Continued cash/vendor/operations management, review and meeting to discuss budgeting toolFri 05/23/2014 1.2 $425 $510.00 Follow-up with counsel re: sale closeFri 05/23/2014 2.4 $425 $1,020.00 Continued cash/vendor/operations management, review and meeting to discuss budgeting tool

Mon 05/26/2014 2.1 $425 $892.50 Follow-up with counsel re: sale closeMon 05/26/2014 2.4 $425 $1,020.00 Continued cash/vendor/operations management, review and meeting to discuss budgeting toolTue 05/27/2014 2.3 $425 $977.50 Distribution of weekly reportTue 05/27/2014 2.9 $425 $1,232.50 CFO Transition planningWed 05/28/2014 1.2 $425 $510.00 Follow-up with counsel re: sale closeWed 05/28/2014 2.4 $425 $1,020.00 Continued cash/vendor/operations management, review and meeting to discuss budgeting tool

7


Restora Healthcare Holdings -Time SummaryErica Lister, Senior AssociateHealthcare Industry Group, LLC


Wed 05/28/2014 2.6 $425 $1,105.00 CFO Transition planningThu 05/29/2014 2.3 $425 $977.50 Continued cash/vendor/operations management, review and meeting to discuss budgeting toolThu 05/29/2014 3.2 $425 $1,360.00 CFO Transition planningFri 05/30/2014 2.2 $425 $935.00 CFO Transition planningFri 05/30/2014 2.3 $425 $977.50 Continued cash/vendor/operations management, review and meeting to discuss budgeting tool

105.0 $44,625.00

8


Restora Healthcare Holdings-Time SummarySteve Kraus, DirectorHealthcare Industry Group, LLC


Thu 05/01/2014 5.70 525$ $2,992.50 Discussion with buyer and counsel re: LOS, deal update call with lender; daily review of operational expenses; ongoing vendor discussions;

Fri 05/02/2014 5.80 525$ $3,045.00 Vendor payment issues addressed; review and submisssion of revolver draw request; daily review of operational espensesMon 05/05/2014 6.10 525$ $3,202.50 Updated budget discussions with counsel; LOS update; deal discussions with Acuity; budget v actual schedule for pro fees for lender and

UCC; daily review of operational expensesWed 05/14/2014 0.50 525$ $262.50 Budget reviewMon 05/19/2014 4.40 525$ $2,310.00 Continued efforts to address vendor issues; daily review of operational expenses; discussion with lender re: budget process; management

review of ongoing operations and financial performance; response to UCC requests; professional fees schedule preparation and review

Tue 05/20/2014 5.10 525$ $2,677.50 Distribution of UCC request fulfillment; daily review of operational expenses; operational insurance review; 503(b)(9) payment review and approval; response to BOD tax inquiries; review of weekly reporting package; PCO reporting needs; vendor invoice review; consulting agreement amendment discussions

Wed 05/21/2014 4.80 525$ $2,520.00 503(b)(9)payment confirmation and distribution, revolver draw review and submission; daily review of operational expenses; discussion with Acuity re: CFO resignation; discussion of CFO transition of duties and required BOD resolutions; discussion with Tutera re: consulting agreement amendment

Thu 05/22/2014 5.20 525$ $2,730.00 Review of UCC invoices; daily review of operational expenses; 401(k) plan detail review; review of UCC diligence request and response; tail coverage requirement discussions; updated budget review; debtor physician AP request; continued vendor issue management; call with Banner

Fri 05/23/2014 4.60 525$ $2,415.00 Revolver draw review; response to lender inquires on draw request; daily review of operational expenses; review of UCC diligence responses; review and discussion of updated budget; discussion with counsel re: pro fee budget; review of court filings;

Tue 05/27/2014 7.40 525$ $3,885.00 Continued vendor issues management; daily review of operational expenses; discussion with counsel re: budget and other issues; continued budget review; collection, review and response to UCC diligence request; review of weekly reporting package;

Wed 05/28/2014 5.60 525$ $2,940.00 Review of pro fee invoices; continued management of vendor issues; daily review of operational expenses; draft budget comparison email for counsel discussion; call with lender to discussion proposed budget; review of draft consulting amendment

Thu 05/29/2014 8.60 525$ $4,515.00 Transition planning with Acuity for CFO resignation; comments to Tutera for consulting agreement amendment; daily review of operational expenses; review of staffing issues and needs; respond to lender inquiries re: April financial statements; distribution of fully executed Tutera amendment

Fri 05/30/2014 5.10 525$ $2,677.50 Review and comments to counsel on CFO consulting agreement; discuss, review and approve staffing changes needed related to CFO resignation; daily review of operational expenses;

68.90 $36,172.50

9


Restora Healthcare Holdings - Time SummarySteve Kotarba, Managing DirectorClaims Management


Wed 05/07/2014 0.90 $650 $585.00 Respond to US Trustee questions re MOR filing.Mon 05/12/2014 0.40 $650 $260.00 Follow up re responding to quesitons re MOR and revisions to same.Thu 05/15/2014 0.30 $650 $195.00 Follow up re responding to quesitons re MOR and revisions to same.Tue 05/20/2014 1.00 $650 $650.00 Internal discussions re April MOR, timing, format and open issues; follow up re template.Wed 05/28/2014 1.10 $650 $715.00 Review and discuss April MOR.Thu 05/29/2014 1.00 $650 $650.00 Revise MOR for filing.Fri 05/30/2014 0.50 $650 $325.00 Finalize MOR for filing.

5.20 $3,380.00

10


Exhibit B

11


*May include unbilled expenses from previous periods.

A&MExpense Summary *

Date Amount Category Person Description

5/21/14 $551.48 Airfare Kraus, Steven Airfare Atlanta/San Francisco5/27/14 $551.48 Airfare Kraus, Steven Airfare Atlanta/San Francisco5/28/14 $65.00 Transportation Kraus, Steven Taxi to airport.5/28/14 $65.00 Transportation Kraus, Steven Taxi to office.5/28/14 $137.08 Lodging Kraus, Steven Hotel in Atlanta - 1 night.5/29/14 $2.13 Meals Kraus, Steven Out of town breakfast - S. Kraus.5/29/14 $16.00 Other Kraus, Steven Parking expense.5/29/14 $97.48 Meals Kraus, Steven Out of town dinner - S. Kraus, E. Lister.5/29/14 $122.10 Lodging Kraus, Steven Hotel in Atlanta - 1 night.5/30/14 $20.12 Meals Kraus, Steven Out of town dinner - S. Kraus

$1,627.87

5/24/14 $556.28 Airfare Lister, Erica Airfare Atlanta/San Francisco.5/28/14 $25.41 Transportation Lister, Erica Taxi to airport.5/28/14 $19.89 Meals Lister, Erica Out of town meal - E. Lister5/28/14 $137.08 Lodging Lister, Erica Hotel in Atlanta - 1 night.5/29/14 $122.10 Lodging Lister, Erica Hotel in Atlanta - 1 night.5/30/14 $5.64 Meals Lister, Erica Out of town meal - E. Lister5/30/14 $574.00 Airfare Lister, Erica Airfare Atlanta/San Francisco.

$1,440.40

12


*May include unbilled expenses from previous periods.

A&MExpense Summary *

Date Amount Category Person Description

5/28/14 $128.20 Transportation Pillari, George Rental car.5/29/14 $214.97 Transportation Pillari, George Rental car.

$343.17

3/25/14 $284.90 Lodging Winters, Ronald Hotel stay - 1 night3/25/14 $119.00 Transportation Winters, Ronald Rail Fare NY/DE3/25/14 $121.00 Transportation Winters, Ronald Rail Fare NY/DE3/25/14 $21.00 Meals Winters, Ronald Out of town meal, R. Winters4/24/14 $25.20 Transportation Winters, Ronald Rail Fare NY/DE4/24/14 $396.00 Transportation Winters, Ronald Rail Fare NY/DE4/25/14 $304.00 Transportation Winters, Ronald Rail Fare NY/DE

$1,271.10

Total $4,682.54

13


in the united states bankruptcy court for the … · to whom it may concern: in accordance with our...

Documents