Office Properties Income Trust - Chapter 11 Bidding Procedures Summary

Global Sale Procedures Summary

Parties Involved

• Debtors: Office Properties Income Trust and its debtor affiliates, as debtors and debtors in possession
• Consultation Parties: (a) the September 2029 Ad Hoc Group; (b) the DIP Lenders; (c) the Committee; and (d) any Prepetition Secured Parties, in each case, solely to the extent a proposed Sale Transaction includes any Assets that constitute such Prepetition Secured Party's primary (i.e., first lien) collateral or are owned by Debtors at which any Prepetition Secured Parties have unsecured guarantees
  • To the extent that any Consultation Party submits a bid or other offer for any of the Debtors' Assets in any Sale Process, such party shall not be a Consultation Party with respect to such Assets to the extent that doing so would violate the Procedures for Complex Cases in the Southern District of Texas
• The Debtors, in consultation with the Consultation Parties, may select Stalking Horse Bidders for any of the Assets
• The Debtors shall provide notice to the Consultation Parties of any involvement of RMR or an affiliate of RMR, whether as potential purchaser, broker, or in any other role other than in its capacity as manager of the Debtors, in any Sale Process
• Throughout any Sale Process, the Debtors and their advisors will consult with the Consultation Parties as provided in the Global Sale Procedures

Assets Being Sold

• The Debtors are seeking to sell certain properties in their real estate portfolio, including certain real estate properties previously designated for sale by the Debtors in the ordinary course of business prior to commencement of the chapter 11 cases
• The Assets are identified on Schedule 1 attached to the Election Notice for each Sale Process
• With respect to any sale of real property owned by a non-Debtor entity (Non-Debtor Property):
  • Such Sale shall not be free and clear of liens, claims, encumbrances, or interests, except to the extent payment at the time of such Sale is indefeasibly made of the total amounts owing to the applicable Non-Debtor Property Debt Lenders under any loan, mortgage, or other indebtedness secured by the Non-Debtor Property, as provided under the applicable Non-Debtor Property Debt Documents
  • None of the provisions of the Global Sale Procedures Order shall be construed to render the stay of section 362(a) of the Bankruptcy Code or any injunction under section 105 of the Bankruptcy Code applicable to the Non-Debtor Property Debt Lenders or any Non-Debtor Borrowers, modify any provision of any Non-Debtor Property Debt Documents, or constitute a waiver or postponement by the Non-Debtor Property Debt Lenders of any of their rights and remedies as against the Non-Debtor Borrowers
  • For the avoidance of doubt, these provisions apply to the sale of any real property held by the following non-Debtor entities: 3300 75th Avenue LLC, Clay Ave Waco, LLC, Echelon Pkwy MS LLC, Ewing Boulevard LLC, Primerica Pkwy GA LLC, Prosperity Metro Plaza of Virginia, LLC, Rio Robles CA LLC, and Sterling Park LLC

Sale Process Options

• The Debtors may elect, in their reasonable business judgment and in consultation with the Consultation Parties, to pursue either of the following processes:
  • Broker Marketing Process: Under this process, the Debtors will engage one or more Brokers to conduct the marketing and sale process for one or more of the Assets. The Debtors, with the assistance of the Broker, will prepare marketing materials, initiate a multi-channel marketing process, commence a competitive bid process through submission of a Call for Offers, analyze bids from potential buyers, determine the highest or otherwise best offer in consultation with the Debtors, negotiate and execute a purchase agreement with the awarded bidder, and coordinate a diligence process
  • Expedited Bankruptcy Auction Process: This is a modified version of a typical marketing and sale process in chapter 11, pursuant to Court-approved bidding procedures on an accelerated timeline
• The Debtors may seek to sell Assets individually or in portfolio Sale Transactions, in each case, pursuant to one or both of the Sale Processes
• If the Debtors determine to submit a Call for Offers for one or more Assets under a Broker Marketing Process, the Debtors will file and serve an Election Notice on the Sale Notice Parties
• If the Debtors determine to hold a Bankruptcy Auction for one or more of the Assets, the Debtors will file and serve an Election Notice on the Sale Notice Parties and schedule an auction on a date that is not less than 25 days following service of the Election Notice

Stalking Horse Bid

• The Debtors, in consultation with the Consultation Parties, may select a Stalking Horse Bidder for any of the Assets for the purposes of establishing one or more Stalking Horse Bids
• The Debtors may provide any such Stalking Horse Bidder with Bid Protections pursuant to a Stalking Horse Agreement and consistent with the Stalking Horse Designation Procedures
• Any designation of a Stalking Horse Bidder for any Assets shall be made no later than ten days following service of the applicable Election Notice
• The Debtors shall file a Stalking Horse Notice (which may be the Election Notice) with the Court and provide such notice to the Sale Notice Parties
• Parties in interest shall have until 4:00 p.m. (prevailing Central Time) on the date that is seven days following service of the Stalking Horse Notice to object to the Debtors' designation of such Stalking Horse Bidder and any Bid Protections
• If there is no objection timely filed to any Stalking Horse Notice prior to the Stalking Horse Objection Deadline (or if such an objection is timely filed but is consensually resolved before a hearing thereon), the designation of the Stalking Horse Bid and Stalking Horse Bidder and associated Bid Protections shall be deemed approved with no further action needed by the Court
• If a timely filed objection is consensually resolved, the Debtors shall promptly file a notice on the docket identifying the objection that has been resolved, and such notice shall include the revised stalking horse bid documents and a brief description of the modifications, if any
• If such an objection is timely filed and not consensually resolved, the Court will schedule a hearing to resolve such an objection, subject to its availability
• Notwithstanding anything in the Global Sale Procedures to the contrary, any Stalking Horse Bidder shall be deemed to be a Qualified Bidder, and any Stalking Horse Bid shall be deemed to be a Qualified Bid, such that such Qualified Bidders shall not be required to submit an additional Qualified Bid

Credit Bid

• Persons or entities holding a perfected security interest in the Assets may, subject to section 363(k) of the Bankruptcy Code or the terms of the DIP Orders, seek to submit a credit bid on such Assets, to the extent permitted by applicable law, any Bankruptcy Court orders and the documentation governing the Debtors' secured debt (including any amounts required to be paid pursuant to any intercreditor agreements); provided, however, no creditor may credit bid any amounts on account of a make-whole, prepayment premium, or similar claims unless such claims have been allowed by order of the Court
• The DIP Lenders and Prepetition Secured Parties (collectively, the Existing Lenders) shall be deemed to be Qualified Bidders for any bid for the collateral on which such parties hold a valid, perfected, and unavoidable lien to the extent provided in section 363(k) of the Bankruptcy Code or other applicable law, and, only for such Credit Bids, shall only be required to deliver to the Debtors a statement clearly identifying (i) the Assets to be purchased; and (ii) the liabilities and obligations to be assumed and setting forth the Transaction Purchase Price for the Bid
• Any Credit Bids submitted by the Existing Lenders shall be deemed to be Qualified Bids to the extent such bids are received by the Bid Deadline
• For the avoidance of doubt, the Existing Lenders shall not be required to provide or deliver (1) an indication of interest, (2) any asset purchase agreement, (3) a Deposit, or (4) any other materials as a condition to submission of a Qualified Bid or such parties' participation at the Bankruptcy Auction with respect to such Credit Bids
• The Existing Lenders that have submitted Credit Bids by the Bid Deadline may participate in the Bankruptcy Auction with respect to such Assets
• At any time prior to the Bankruptcy Auction, each such Existing Lender may make the determination that it no longer wants to be a Qualified Bidder on all or a subset of Assets by written notice to Debtors' counsel (each a Designation). Upon such Designation, such Existing Lender shall cease being a Qualified Bidder with respect to Assets subject to the Designation and shall be deemed a Consultation Party in connection with the sale of the Designated Assets
• If a Credit Bid has not been withdrawn prior to the commencement of the Auction, such bid shall become irrevocable, subject to the terms of the Bidding Procedures
• The Existing Lenders agree to proceed with definitive documents to be agreed with the Debtors to the extent any such Existing Lender is named the Successful Bidder for the Assets that are the subject of its Credit Bid

Bid Requirements

• To participate in the Expedited Bankruptcy Auction Process, a Prospective Bidder must deliver to the applicable Broker listed in the Election Notice an executed confidentiality agreement in form and substance reasonably acceptable to the Debtors
• Upon execution of a valid confidentiality agreement, any Prospective Bidder identified by the Debtors, after consultation with the Consultation Parties, to be reasonably likely to be a Qualified Bidder may be granted access to confidential due diligence information regarding the Assets
• If the Debtors, after consultation with the Consultation Parties, determine that a Prospective Bidder does not qualify as a Qualified Bidder, the Prospective Bidder shall not be entitled to access to such confidential due diligence information
• To constitute a Qualified Bid, a Bid must satisfy the following conditions:
  • Bid Irrevocable: Each Bid (other than a credit bid) must provide that it is irrevocable and binding in all respects until the closing of the Sale Transaction if such Prospective Bidder is the Successful Bidder, and that the Prospective Bidder agrees to serve as a backup bidder if such bidder's Bid is selected as the next highest or otherwise next best bid after the Successful Bid
  • Executed Agreement: Each Bid must be based on the proposed form purchase agreement and must include executed transaction documents pursuant to which the Potential Bidder proposes to effectuate a Sale Transaction. Each Bid must also include a copy of the Purchase Agreement marked against the respective form purchase agreement or applicable Stalking Horse Bid to show all changes requested by the Potential Bidder. Each Purchase Agreement must provide a commitment to close as soon as practicable
  • Assets and Liabilities: Each Bid must clearly identify (i) the Assets to be purchased; and (ii) the liabilities and obligations to be assumed, including any indebtedness to be assumed, if any
  • Designation of Assigned Contracts: Each Bid must identify any and all executory contracts of the Debtors that the bidder wishes to be assumed and assigned to the bidder at closing. The Bid must confirm that the bidder will be responsible for any Cure Costs associated with such assumption, and include a good faith estimate of such Cure Costs
  • Purchase Price: Each Bid (other than a credit bid) must be for cash. The Bid must clearly set forth the cash purchase price, and any other non-cash consideration (with the form of such consideration specified), to be paid
  • Minimum Bid: Each Bid submitted must either provide for the payment of aggregate consideration the value of which is in excess of at least the sum of (x) the purchase price under the applicable Stalking Horse Agreement and (y) any Bid Protections approved by the Court; or propose an alternative transaction that provides higher value or better terms than any Stalking Horse Bid, and is determined by the Debtors, in consultation with the Consultation Parties, to be in the best interests of the Debtors' estates
  • Deposit: Each Bid (except a credit bid) must be accompanied by a good faith deposit in the form of cash in an amount equal to not less than 10% of the cash portion of the Transaction Purchase Price of the Bid; provided that the Debtors, in their reasonable business judgment and in consultation with the Consultation Parties, may elect to waive or modify the requirement of a Deposit on a case-by-case basis
  • Financial and Adequate Assurance Information: Each Bid must include written evidence that the Debtors reasonably conclude, in consultation with the Consultation Parties, demonstrates that the bidder has the necessary financial ability to timely close the proposed Sale Transaction and provide adequate assurance of future performance
  • Contingencies; No Financing or Diligence Outs: A Bid shall not be conditioned on the obtaining or the sufficiency of financing or any internal approval, or on the outcome or review of due diligence
  • Identity: Each Bid must fully disclose the legal identity of each person or entity bidding for the Assets, and the complete terms of any such participation and must also disclose any connections, arrangements or agreements with the Debtors, any other known bidder, and any officer or director of the foregoing and concerning a collaborative or joint bid or any other combination concerning the proposed Bid
  • Representations and Warranties; As-Is, Where-Is; No Collusion: Each Bid must include representations that the Prospective Bidder has had an opportunity to conduct due diligence, has relied solely upon its own independent review, agrees to not use information obtained in the diligence process in connection with litigation, and acknowledges that it has not engaged in any collusion that would be subject to section 363(n) of the Bankruptcy Code
  • Authorization: The Bid must include evidence that the Prospective Bidder has obtained authorization or approval from its board of directors (or comparable governing body), if applicable, acceptable to the Debtors
  • No Bid Protections or Fees: Each Bid (other than a Stalking Horse Bid) must disclaim any right to receive a fee analogous to a break-up fee, expense reimbursement, topping or termination fee, or any other similar form of compensation. Each Prospective Bidder and Qualified Bidder, by submitting its Bid, agrees to refrain from and waive any assertion or request for reimbursement on any basis, including under section 503(b) of the Bankruptcy Code
  • Time Frame for Closing: Each Bid must be reasonably likely to be consummated within a time frame reasonably acceptable to the Debtors in consultation with the Consultation Parties, and subject to the Milestones contained in the DIP Orders. Each Bid shall state the expected date of closing of the Sale Transaction
  • Compliance with Bankruptcy Code and Non-Bankruptcy Law; Adherence to Global Sale Procedures: Each Bid must include a statement that the Prospective Bidder has acted in good faith consistent with section 363(m) of the Bankruptcy Code and agrees to be bound by and has complied with the Global Sale Procedures Order
  • Backup Bidder Commitment: Each Bid must include a written commitment by the applicable Prospective Bidder to serve as a Backup Bidder in the event that such Prospective Bidder's bid is not selected as the Successful Bid
  • Other Information: The Bid contains such other information as may be reasonably requested by the Debtors and the Consultation Parties
• A Bid received that meets the above requirements, as determined by the Debtors, in consultation with their advisors and the Consultation Parties, in the Debtors' reasonable business judgment will constitute a Qualified Bid
• If the Debtors receive a Bid that does not meet the requirements for a Qualified Bid, the Debtors may provide the Prospective Bidder with the opportunity to remedy any deficiencies before the Bankruptcy Auction to render such Bid a Qualified Bid
• The Debtors may also, after consulting with the Consultation Parties, waive or modify any of the above requirements in the exercise of their reasonable business judgment

Overbid

• Qualified Bidders may submit successive bids higher than the previous bid, based on and increased from the Baseline Bid
• The Debtors shall, in consultation with the Consultation Parties, determine and announce at the outset of the Bankruptcy Auction the minimum required increments for successive Qualified Bids (the Minimum Overbids)
• The Debtors may, in their reasonable business judgment and in consultation with the Consultation Parties, announce increases or reductions to Minimum Overbids at any time during the Bankruptcy Auction
• Each round of bidding will conclude after each participating Qualified Bidder has had the opportunity to submit a subsequent bid with full knowledge of the Leading Bid
• All participating Qualified Bidders are required to bid in each round or they forfeit their right to participate in subsequent rounds
• Except as modified at the Bankruptcy Auction, an Overbid must comply with the conditions for a Qualified Bid, provided, however, that no additional Deposit shall be required beyond the Deposit previously submitted by a Qualified Bidder, provided that the Successful Bidder (other than a credit bid) with respect to a Sale Transaction shall be required to make a representation at the end of a Bankruptcy Auction that it will provide any additional deposit necessary so that its Deposit is equal to 10% of the cash portion of the Transaction Purchase Price of the Bid

Bid Protections

• In the event that the Debtors designate a Stalking Horse Bidder and the Stalking Horse Bidder is not the Successful Bidder with respect to the Stalking Horse Bid, the Debtors shall be authorized, but not directed, to make certain payments in consideration of its being the Stalking Horse Bidder, including (a) any Break-Up Fee and (b) any Expense Reimbursement Amount
• The amount of any consensual Break-Up Fee and Expense Reimbursement Amount shall, in the aggregate, not exceed 3% of the cash portion of the applicable Transaction Purchase Price for such Stalking Horse Bid, with such amount to be paid solely in accordance with the terms and conditions set forth in the applicable Stalking Horse Agreement and as approved by the Bankruptcy Court in the Global Sale Procedures Order
• The sole remedy against the Debtors of any Stalking Horse Bidder in connection with its Stalking Horse Bid shall be the return of the applicable deposit (if applicable) and the Bid Protections, in the event that the applicable Stalking Horse Agreement is terminated pursuant to the applicable provisions of such agreement
• Any Break-Up Fee and Expense Reimbursement Amount afforded by the Debtors to a Stalking Horse Bidder shall be deemed an actual and necessary cost of preserving the Debtors' estates within the meaning of section 503(b) of the Bankruptcy Code
• To the extent earned pursuant to a Court-approved Stalking Horse Agreement and not otherwise payable as an allowed administrative expense under section 503(b), any such Bid Protections are authorized and may be allowed as superpriority administrative expense claims under section 364(c)(1) of the Bankruptcy Code

Auction Details

• The Debtors may, in consultation with the Consultation Parties, conduct any Bankruptcy Auction in any manner to facilitate a Sale Transaction for all or different subgroupings of the Assets and individual Assets, including conducting multiple Bankruptcy Auctions for different subgroupings of the Assets and individual Assets
• If two or more Qualified Bids (including a Stalking Horse Bid or credit bid) are received by the Bid Deadline, the Debtors may conduct the Bankruptcy Auction with respect to the Debtors' Assets subject to such Qualified Bids
• If only one Qualified Bid (including a Stalking Horse Bid or credit bid) with respect to a Sale Transaction is received by the Bid Deadline, the Debtors may, after consulting with the Consultation Parties, select the Purchase Agreement or Stalking Horse Agreement of such Qualified Bidder to be the Successful Bid, cancel the Bankruptcy Auction, and designate such Qualified Bidder the Successful Bidder with respect to the applicable Sale Transaction
• The Debtors will promptly file the Notice of Successful Bidder with respect to such Sale Transaction
• To the extent there are no Qualified Bids or Stalking Horse Bids with respect to certain of the Debtors' assets, the Debtors will determine the next phase of the process for the applicable Sale Transaction
• Prior to the commencement of the Bankruptcy Auction, the Debtors will notify all Qualified Bidders of the highest or otherwise best Qualified Bid (the Baseline Bid) with respect to a proposed Sale Transaction, and provide copies of the Purchase Agreement supporting the Baseline Bid to all Qualified Bidders who have submitted a Qualified Bid with respect to the proposed Sale Transaction
• The determination of which Qualified Bid constitutes the Baseline Bid and which Qualified Bid constitutes the Successful Bid with respect to a proposed Sale Transaction shall take into account any factors the Debtors (in consultation with the Consultation Parties) reasonably deem relevant to the value of the Qualified Bid to the Debtors' estates
• The bidding at the Auction shall be transcribed and the Debtors shall maintain a transcript of all Bids made and announced at the Auction
• The Bankruptcy Auction shall take place on a date that is not less than 25 days following service of the Election Notice, at a time and location designated by the Debtors or via a virtual meeting (either telephonic or via videoconference)
• The applicable Bankruptcy Auction may be postponed, adjourned or cancelled as the Debtors deem appropriate, in consultation with the Consultation Parties
• Reasonable notice as is reasonably practicable under the circumstances of such postponement or adjournment and the time and place for the commencement or resumption of the applicable Bankruptcy Auction or cancellation shall be given to all Qualified Bidders
• The Debtors, with the assistance of their advisors, shall direct and preside over the Bankruptcy Auction
• Only the Debtors, the Consultation Parties, and any Qualified Bidders that have submitted Qualified Bids by the Bid Deadline, in each case, along with their representatives and counsel, are eligible to attend the Bankruptcy Auction
• Each Qualified Bidder participating in the Bankruptcy Auction will be required to confirm in writing and on the record at the Bankruptcy Auction that it has not engaged in any collusion with respect to the submission of any bid or the Bankruptcy Auction and each Qualified Bid that it submits at the Bankruptcy Auction is a binding, good faith and bona fide offer to purchase the Assets identified in such bid
• Bidding shall commence at the amount of the Baseline Bid
• After the first round of bidding and between each subsequent round of bidding, the Debtors shall announce the bid that they believe in their reasonable business judgment to be the highest or otherwise best offer for the relevant Assets (the Leading Bid) and describe the material terms thereof
• The Debtors may, in their reasonable business judgment in consultation with the Consultation Parties, reject, at any time before entry of an order of the Court approving a Qualified Bid, any bid that the Debtors determine is inadequate or insufficient, not in conformity with the requirements of the Bankruptcy Code, the Global Sale Procedures, or the terms and conditions of the Expedited Bankruptcy Auction Process, or contrary to the best interests of the Debtors, their estates, their creditors, and other stakeholders
• The Debtors shall have the right to request any additional financial information that will allow the Debtors to make a reasonable determination as to a Qualified Bidder's financial and other capabilities to consummate the transactions contemplated by their proposal
• The Debtors may announce at the Bankruptcy Auction modified or additional procedures for conducting the Bankruptcy Auction, or otherwise modify the Global Sale Procedures to the extent any such modifications are material
• The Debtors reserve the right, in their reasonable business judgment, to adjourn the Bankruptcy Auction one or more times to facilitate discussions between the Debtors and Qualified Bidders, facilitate discussions between the Debtors and the Consultation Parties, allow Qualified Bidders to consider how they wish to proceed, and provide Qualified Bidders the opportunity to provide the Debtors with such additional evidence as the Debtors may require
• The Debtors will use commercially reasonable efforts to, within two business days after the conclusion of the Bankruptcy Auction, or as soon as reasonably practicable thereafter, file with the Court, serve on the Sale Notice Parties, and cause to be published on the Case Website, a Notice of Successful Bidder, which shall identify the Successful Bidder and Backup Bidder
• If only one Qualified Bid (including any applicable Stalking Horse Bid) is received by the Bid Deadline, the Debtors will not conduct the Bankruptcy Auction for the applicable Assets and will file a Notice of Successful Bidder indicating that the Bankruptcy Auction for the relevant Assets has been canceled, indicating that such Qualified Bidder or Stalking Horse Bidder is the Successful Bidder, and setting forth the date and time of the applicable Sale Hearing
• If no Qualified Bids other than the Stalking Horse Bid are received for the Assets included in the Stalking Horse Bid by the Bid Deadline, then the Debtors, in consultation with the Consultation Parties, may cancel the Auction with respect to such Assets
• The Debtors and their advisors (in consultation with the Consultation Parties) will determine which Potential Bidders are Qualified Bidders and whether Bids submitted constitute Qualified Bids
• Any Bid that is not deemed a Qualified Bid will not be considered by the Debtors
• As soon as reasonably practicable, and by no later than 24 hours before the commencement of the Bankruptcy Auction, the Debtors shall notify each Prospective Bidder whether such party is a Qualified Bidder
• If any Bid is determined by the Debtors (in consultation with the Consultation Parties) not to be a Qualified Bid, the Debtors will refund such Prospective Bidder's Deposit on or before the date that is five business days after the Bid Deadline
• Between the date that the Debtors notify a Prospective Bidder that it is a Qualified Bidder and the Bankruptcy Auction, the Debtors may discuss, negotiate, or seek clarification of any Qualified Bid from a Qualified Bidder
• Without the prior written consent of the Debtors in consultation with the Consultation Parties, a Qualified Bidder may not modify, amend, or withdraw its Qualified Bid, except for proposed amendments to increase the consideration contemplated by, or otherwise improve the terms of, the Qualified Bid, during the period that such Qualified Bid remains binding
• Any improved Qualified Bid must continue to comply with the requirements for Qualified Bids set forth in the Global Sale Procedures

Successful Bidder

• Immediately prior to the conclusion of the Bankruptcy Auction, the Debtors shall, in consultation with the Consultation Parties, determine consistent with the Global Sale Procedures, which Bid constitutes the highest or otherwise best Bid with respect to each Sale Transaction (the Successful Bid); and notify all Qualified Bidders at the Bankruptcy Auction for the Assets of the identity of the bidder that submitted the Successful Bid (the Successful Bidder) and the amount of the purchase price and other material terms of the Successful Bid with respect to such Sale Transaction
• The Debtors shall file a notice identifying the Successful Bidder and Backup Bidder (if selected) (the Notice of Successful Bidder) with respect to each Sale Transaction as soon as reasonably practicable after closing of the Bankruptcy Auction with respect to such Sale Transaction, and in any event not later than two business days after the closing of the Bankruptcy Auction
• The Debtors' presentation of a particular Qualified Bid to the Court for approval does not constitute the Debtors' acceptance of such Qualified Bid
• The Debtors will be deemed to have accepted a Bid only when the Bid has been approved by the Court at the Sale Hearing
• The Debtors shall seek approval by the Court to consummate the Backup Bid, solely in the event the Successful Bidder fails to close the transaction as provided in the Successful Bid and with all rights reserved against the Successful Bidder

Backup Bidder

• Notwithstanding anything in the Global Sale Procedures to the contrary, if a Bankruptcy Auction is conducted, the Qualified Bidder with the next-highest or otherwise second-best Qualified Bid as compared to the Successful Bid at the Bankruptcy Auction for the Assets under a Sale Transaction, as determined by the Debtors in the exercise of their reasonable business judgment (the Backup Bid), shall be required to serve as a backup bidder (the Backup Bidder) with respect to such Sale Transaction
• Each Qualified Bidder with respect to a Sale Transaction shall agree and be deemed to agree to be the Backup Bidder with respect to such Sale Transaction if so designated
• The identity of the Backup Bidder and the amount and material terms of the Qualified Bid of the Backup Bidder shall be announced by the Debtors at the conclusion of the Bankruptcy Auction at the same time the Debtors announce the identity of the Successful Bidder
• The Backup Bid shall remain binding on the Backup Bidder until the closing of a Sale Transaction for the applicable Assets pursuant to the Successful Bid (the Backup Bid Outside Date)
• If a Successful Bidder fails to consummate the approved transactions contemplated by its Successful Bid prior to the Backup Bid Outside Date, the Debtors may select the Backup Bidder as the Successful Bidder with respect to such Sale Transaction, and such Backup Bidder shall be deemed a Successful Bidder for all purposes

Good Faith Deposit

• Each Bid (except a credit bid) must be accompanied by a good faith deposit in the form of cash in an amount equal to not less than 10% of the cash portion of the Transaction Purchase Price of the Bid, to be held in an escrow account to be identified and established by the Debtors; provided that the Debtors, in their reasonable business judgment and in consultation with the Consultation Parties, may elect to waive or modify the requirement of a Deposit on a case-by-case basis
• The Deposits of all Qualified Bidders (including any Stalking Horse Bidders) shall be held in escrow by the Debtors, or their agent, and shall not become property of the Debtors' estates unless and until released from escrow to the Debtors pursuant to the terms of the applicable escrow agreement or order of the Bankruptcy Court
• The Deposit of the Successful Bidder with respect to a Sale Transaction shall be applied to the purchase price of such transaction at closing
• The Deposits for each Qualified Bidder that is neither the Successful Bidder nor the Backup Bidder with respect to a Sale Transaction shall be returned on or before the date that is five business days after the Bankruptcy Auction
• The Backup Bidder's Deposit shall be held in escrow until the earlier of (a) the closing of the Sale with the Successful Bidder or (b) the Backup Bid Outside Date
• In the event the Successful Bidder fails to close prior to the Backup Bid Outside Date and the Debtors opt to close on the Sale Transaction set forth in the Backup Bid, the Backup Bidder's Deposit shall be applied to the purchase price of such transaction at closing
• In the event the Debtors close the Sale Transaction with the Successful Bidder or have not closed such transaction by the Backup Bid Outside Date, the Backup Bidder's Deposit shall be returned on or before the date that is five business days after the occurrence of the Backup Bid Outside Date
• In the event of a breach or failure to consummate a Sale by the Successful Bidder or the Backup Bidder, as applicable, the defaulting Successful Bidder's Deposit or Backup Bidder's Deposit, as applicable, shall be forfeited to the Debtors, and the Debtors specifically reserve the right to seek all available remedies against the defaulting Successful Bidder or Backup Bidder, as applicable

Sale Free and Clear & Successor Liability

• Except as otherwise provided in the applicable purchase agreement or Sale Order, any Assets of the Debtors sold pursuant to the Global Sale Procedures shall be conveyed at the closing of a transaction with a successful bidder in their then-present condition, "AS IS, WITH ALL FAULTS, AND WITHOUT ANY WARRANTY WHATSOEVER, EXPRESS OR IMPLIED"
• Except as may be set forth in the applicable purchase agreement or Sale Order, the Assets are sold free and clear of any and all liens, claims, interests, restrictions, charges and encumbrances of any kind or nature to the fullest extent permissible under the Bankruptcy Code, with such liens, claims, interests, restrictions, charges, and encumbrances to attach to the proceeds of sale paid directly to the Debtors (to be held by the Debtors for the benefit of, and pending the distribution of such proceeds to, the Existing Lenders and other holders of liens in accordance with the priority of their respective liens and otherwise subject to the DIP Orders) with the same validity and in the same order of priority
• Any Sale Transaction resulting from the Broker Marketing Process or Bankruptcy Auction 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, 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 applicable Sale Transaction
• Accordingly, as a result of such Sale Transaction, the Successful Bidder will not be a successor to any of the Debtors by reason of any theory of law or equity, and the Successful Bidder will have no liability, except as expressly provided in the Successful Bidder Purchase Agreement, for any liens, claims, encumbrances and other interests against or in any of the Debtors under any theory of law, including successor liability theories

Key Dates

• Deadline to serve any required notices upon contract counterparties regarding contracts to be assumed and assigned: Within seven days of service of the Election Notice
• Stalking Horse Designation Deadline: No later than 10 days following service of the Election Notice
• Election Notice Objection Deadline: No earlier than 14 days following service of the Election Notice
• Bid Deadline: No earlier than 20 days following service of the Election Notice
• Deadline to file Notice of Successful Bidder (if only one Qualified Bid received): Within 48 hours of the Bid Deadline
• Deadline for Debtors to designate Qualified Bidders for the Bankruptcy Auction: Within 24 hours of the Bankruptcy Auction
• Bankruptcy Auction: Not less than 25 days following service of the Election Notice
• Deadline to file Notice of Successful Bidder (if Bankruptcy Auction held): Within two business days of Bankruptcy Auction
• Bankruptcy Auction Process Sale Objection Deadline: Five business days following the filing of the Notice of Successful Bidder
• Broker Marketing Process Sale Objection Deadline: 14 days after the service of the Sale Notice (subject to extension by the Debtors)
• Proposed date of Sale Hearing for Bankruptcy Auction Process: Five business days following Bankruptcy Auction Sale Objection Deadline (subject to Bankruptcy Court availability)
• The dates and deadlines set forth in the Global Sale Procedures Order are subject to modification by the Debtors in consultation with the Consultation Parties and in accordance with the Global Sale Procedures

Noticing

• The Sale Process Notices, including the Election Notices, and other forms of notice under the Global Sale Procedures are approved
• No other or further notice of any Sale Process election, Sale Transaction, Bankruptcy Auction, Sale Hearing, or objection deadline shall be required if notice is provided as set forth in the Global Sale Procedures and the Global Sale Procedures Order
• Any party or entity who fails to timely file an objection conforming with the requirements and deadlines set forth in the Global Sale Procedures or the Global Sale Procedures Order shall be forever barred from asserting any objection to the applicable Sale Transaction, including with respect to the transfer of any Assets free and clear of all liens, claims, encumbrances, and other interests
• The form and manner of notice for the Sale Processes, including the Sale Process Notices and other forms of notice under the Global Sale Procedures, are reasonably calculated to provide all interested parties with timely and proper notice of any Sale Process election, any proposed Sale Transaction, and any other relevant dates and deadlines
• The Sale Notice Parties include: counsel to the Consultation Parties; counsel to any Stalking Horse Bidder; counsel to RMR; the parties on the Debtors' master service list maintained by the Claims Agent; any governmental entity known to have a claim against the Debtors; all applicable federal, state, and local taxing and regulatory authorities, including the Internal Revenue Service; all environmental authorities having jurisdiction over any of the Assets; the United States Attorney for the Southern District of Texas; the Office of the Attorney General and the Office of the Secretary of State in each state in which the Debtors operate; the Antitrust Division of the United States Department of Justice; the Federal Trade Commission; all persons and entities entitled to notice pursuant to Bankruptcy Rule 2002; all persons and entities who expressed an interest in the assets in the 12-month period prior to the date of the applicable notice; and all other persons and entities as directed by the Bankruptcy Court
• When service on the Sale Notice Parties is required by the Global Sale Procedures, service shall be by email or U.S. First-Class Mail if email is not available for a party
• Copies of the Global Sale Procedures Motion, the Global Sale Procedures, the Global Sale Procedures Order, and all other documents filed with the Court, are available free of charge on the Debtors' case information website at https://restructuring.ra.kroll.com/OPI/, or can be requested by calling the Debtors' claims and noticing agent, Kroll Restructuring Administration LLC, at 1 (877) 814-0967 (Domestic) or 1 (646) 440-4367 (International)

Sale Hearing

• For the Broker Marketing Process: The Debtors shall provide notice of the applicable Sale Hearing in the Sale Notice or subsequent notice filed by the Debtors in advance of the proposed Sale Hearing. The Sale Hearing may be adjourned or continued by the Debtors in their discretion (subject to Court availability)
• For the Bankruptcy Auction Process: The proposed date for any Sale Hearing with respect to a Sale Transaction shall be the date that is five business days following the Bankruptcy Auction Sale Objection Deadline (subject to Bankruptcy Court availability) at a time to be determined and noticed by the Debtors, before the Honorable Christopher M. Lopez at the United States Bankruptcy Court for the Southern District of Texas, Courtroom No. 402, 4th Floor, 515 Rusk Street, Houston, Texas 77002
• The Sale Hearing may be continued to a later date by the Debtors by sending notice prior to, or making an announcement at, the Sale Hearing. No further notice of any such continuance will be required to be provided to any party
• The Debtors reserve the right to seek an expedited Sale Hearing or multiple Sale Hearings as may be useful or necessary to effectuate any Sale Transactions; provided that the Debtors shall not reduce the time provided herein for a party in interest to file any Sale Objection absent further order of the Court
• Approval of the Sale Transaction shall be considered by the Court at the applicable Sale Hearing
• If a timely Sale Objection cannot otherwise be resolved by the parties, such objection shall be heard at the applicable Sale Hearing

Distribution of Sale Proceeds

• The distribution of any net proceeds of a Sale Transaction for any Asset subject to a prepetition first lien security interest in favor of a Prepetition Secured Party shall be subject to (a) the consent of such Prepetition Secured Party or (b) further order of the Court specifically authorizing use or other distributions of such proceeds
• The use or distribution of any net proceeds of a Sale Transaction for any Asset subject to a prepetition first lien security interest in favor of a Prepetition Secured Party shall be subject to (a) the consent of such Prepetition Secured Party or (b) further order of the Court specifically authorizing use or other distributions of such proceeds

Reservation of Rights

• The Debtors reserve the right to, in their reasonable business judgment, in a manner consistent with their fiduciary duties and applicable law, and in consultation with the Consultation Parties, modify the Global Sale Procedures; waive terms and conditions set forth therein with respect to all prospective bidders and interested parties; extend the deadlines set forth therein; announce additional or modified procedures with respect to any Sale Process; provided, however, that any material modifications of the Global Sale Procedures that affect a pending Sale Process for any Prepetition Secured Party Assets shall require the prior consent (not to be unreasonably withheld) of the applicable Prepetition Lender Consultation Parties
• Nothing in the Global Sale Procedures will require the board of trustees, board of directors, or such similar governing body of a Debtor to take any action, or to refrain from taking any action, with respect to the Global Sale Procedures or any Sale Process, to the extent such board of directors, board of managers, or such similar governing body determines in good faith, after consultation with counsel, that taking such action, or refraining from taking such action, as applicable, would be inconsistent with applicable law or its fiduciary obligations under applicable law
• The Debtors reserve the right to sell any Assets by separate motion, including on an emergency basis, in accordance with the Bankruptcy Code, Bankruptcy Rules, the Local Rules, and the Complex Case Procedures

Consent to Jurisdiction

• All prospective and actual bidders shall be deemed to have consented to the exclusive jurisdiction of the Court for any and all matters related to, or in connection with, the Global Sale Procedures, including, without limitation, any finding or determination that such prospective bidders have waived any right to a jury trial in connection with any disputes relating to any Sale Process, the construction and enforcement of the Global Sale Procedures, any credit bid, any Stalking Horse Agreement, or purchase agreement, as applicable

Confidentiality and Due Diligence

• With respect to the consultation rights of the Consultation Parties to certain actions by and determinations of the Debtors granted herein, the Debtors will in good faith provide the Consultation Parties with reasonable notice of, information with respect to, and opportunity to consult upon and provide objections to, such actions by and determinations of the Debtors
• All information disclosed by any Potential Bidder, Qualified Bidder, or Stalking Horse Bidder in connection with the Sale Processes will promptly be made available by the Debtors to the advisors to the Consultation Parties; provided, that the Debtors will not be required to share such confidential information with any Consultation Party that discloses an intention to submit a Qualified Bid whether directly or through an affiliate
• Any confidential information, including any confidential financing and/or equity commitment documents received, will only be shared with the advisors to the Consultation Parties on a "professional eyes only" basis, and the Debtors and the Consultation Parties may enter into customary non-disclosure agreements as necessary for such information to be further shared confidentially with the Consultation Parties

Restructuring Support Agreement Compliance

• Notwithstanding anything to the contrary, the Debtors shall comply with all consent rights applicable to the sale of the Assets as set forth in (x) that certain Restructuring Support Agreement (as may be modified, amended, or supplemented and including all exhibits, schedules, or supplements thereto), entered into on October 30, 2025 between the Debtors, the September 2029 Ad Hoc Group, and RMR, in its capacity as manager to the Debtors, and (y) the DIP Orders and DIP Credit Agreement, as applicable