Hansen-Mueller - Chapter 11 APA Summary

Asset Purchase Agreement Summary

Parties Involved

• Seller: Hansen-Mueller Co., as the Debtor and Debtor-in-Possession.
• Purchasers: The Sale Order identifies multiple purchasers across the various Asset Purchase Agreements (APAs), including:
  • The Redwood Group, LLC and its related entity Superior Grain, LLC (collectively, "Redwood Group");
  • Paterson Grain, LLC and its subsidiary Heartland Distribution, LLC (collectively, "Paterson Grain"); and
  • West Plains, LLC.
• Consultation Parties: The Debtor determined the Successful Bids in consultation with designated Consultation Parties.

Assets Being Sold

• The transaction involves the sale of specific asset lots pursuant to multiple APAs, including real property, inventory, and operational assets located at various facilities.
• Facilities and Real Property:
  • Assets and properties used exclusively to operate the grain elevator located in Council Bluffs, Iowa.
  • Core assets and properties used exclusively to operate the oat processing facility located at 1800 North Water Street, Toledo, Ohio (the "Toledo Facility"), including the real estate, buildings, and improvements.
  • Assets and properties used to operate the grain elevator located at 21-21st Avenue East, Superior, Wisconsin, including the real estate and improvements.
  • Rights and interests under the Elevator Lease, including any related security deposits.
• Personal Property and Inventory:
  • Bulk grain inventory located at scheduled locations, along with related warehouse receipts and bills of lading.
  • Furniture, fixtures, equipment (FFE), machinery, rolling stock, and vehicles located at the elevators.
  • Assignable grain purchase/sale contracts ("Assumed Grain Contracts") and railcar leases ("Assumed Railcar Leases").
• Purchase Price:
  • The APAs reflect multiple purchase price structures and amounts depending on the purchaser and/or the applicable lot(s) of assets being acquired.
  • Fixed purchase prices stated in the APAs include:

    • $101,000;

    • $5,344,990;

    • $6,255,000, subject to adjustment by the purchaser pursuant to, and in accordance with, the Bidding Procedures Order. 

    • One APA provides that the purchase price is the aggregate amount set forth on Schedule 3.1(a) for the lots of assets and properties to be purchased by the purchaser; Schedule 3.1(a) reflects a total lot purchase price of $12,000,000.

Bid Requirements

• To qualify as a "Qualified Bidder," a party was required to deliver:
  • Evidence of financial ability to consummate a cash sale for the full purchase price;
  • An executed version of the APA (with a redline highlighting any proposed changes); and
  • A deposit equal to at least 10% of the purchase price.

Good Faith Deposit

• Amount: A deposit of at least 10% of the Purchase Price is required in immediately available funds. The extractions note a specific deposit payment of $510,000 held in escrow.
• Refunds: The deposit is refundable if the Court does not approve the agreement, the bidder is not the Successful Bidder, the closing fails to occur for reasons other than the purchaser's breach, or by mutual consent.
• Forfeiture: If the closing fails to occur due to a purchaser's breach, the Seller may retain the deposit as liquidated damages.

Auction Details

• Occurrence: The Auction took place on Dec. 16, 2025.
• Selection: At the conclusion of the Auction, the Seller requested Court approval for the sale to the highest Qualified Bidder (the "Successful Bidder").
• Back-Up Bidding: No bidder other than the highest bidder is bound to close. However, if the Successful Bidder fails to close, the Seller retains the discretion to conduct a new auction.

Assumption and Assignment

• The Seller is authorized to assume and assign the Assumed Contracts free and clear of liens and encumbrances.
• Consent Requirements:
  • Generally, assignment is authorized without counterparty consent.
  • However, specific contracts (Nos. 70736, 70737, 70738, 70702, 70703, and 70704) are assigned subject to the counterparty's existing rights, including the right to challenge the assignment.
  • For contracts not assignable under Section 365 without consent, the parties agreed to use commercially reasonable efforts to obtain necessary third-party consents prior to closing.

Sale Free and Clear & Successor Liability

• Free and Clear: The assets are sold free and clear of all liens, claims, interests, and encumbrances, including tax liens, mechanics' liens, and successor liability claims, to the fullest extent permitted under Section 363 of the Bankruptcy Code.
• No Successor Liability: The Purchasers are not deemed legal successors to the Debtor. They assume no derivative, vicarious, or transferee liability for claims such as environmental, tax, labor, products, or antitrust liability, whether known or unknown.

Post-Closing Arrangements

• Records Access: The Purchaser must retain elevator records (or copies) and provide the Seller reasonable access to complete tax returns, pursue estate causes of action, and fulfill reporting requirements.
• Storage and Load Out Fees: The agreements stipulate specific post-closing fees for grain inventory:
  • Kansas City, MO & Sioux City, IA: Load out fee of $0.10 per bushel and storage charges of $0.04 per bushel per month.
  • Oat Inventory (Kansas City, MO & Duluth, MN): Load out fee of $15 per short ton and storage charges of $2.00 per short ton per month.
  • Seller's Retained Grain: If the Seller retains grain at the Elevator post-closing, they must pay the Purchaser a load out fee of $15 per short ton and storage charges of $2.00 per short ton per month.

Key Dates

• Bidding Procedures Order Entered: Dec. 3, 2025
• Auction Date: Dec. 16, 2025
• Sale Hearing: Dec. 22, 2025
• Closing Date:
  • Generally targeted for Jan. 5, 2026, or Jan. 15, 2026 (depending on the specific APA).
  • Alternatively defined as on or before the sixth business day following the satisfaction of closing conditions.
• Outside Date: Jan. 9, 2026