Razzoo's - Chapter 11 APA Summary

Asset Purchase Agreement Summary

Parties Involved

• Sellers: Razzoo’s, Inc. and Razzoo’s Holdings, Inc. (collectively, the "Debtors").
• Purchaser: Thirty Three97 LLC (the "Buyer").
• The Buyer and its affiliates are not "insiders" or "affiliates" of the Debtors, and no common identity of incorporators, directors, or stockholders exists between the parties.

Assets Being Sold

• The transaction contemplates the sale of substantially all of the Debtors' rights, title, and interests in tangible and intangible real and personal property used in the operation of the Business (the "Purchased Assets") on an "as is, where is" basis.
• Purchased Assets generally include:
  • All Cash (other than Excluded Cash Amounts) and Accounts Receivable for all Continuing Restaurants;
  • Inventory, including supplies and materials on order;
    • Alcoholic beverage inventory in jurisdictions requiring specific Liquor License Approvals will be transferred upon issuance of such approvals.
  • All Intellectual Property, including recipes, methods, menus, and nutritional data, as well as websites, URLs, and domain names;
  • Tangible personal property, including machinery, equipment, POS systems, furniture, and kitchen equipment located at Continuing Restaurants, the Debtors' headquarters, and the warehouse facility;
  • All Assumed Permits and Liquor Licenses, to the extent transferable;
  • All goodwill associated with the Business and Purchased Assets;
  • Certain insurance proceeds, including those related to casualty or condemnation events occurring prior to or after closing;
  • Rights under warranties, representations, and guarantees from suppliers; and
  • Certain causes of action defined as "Purchased Actions."
• Excluded Assets include:
  • Excluded Cash Amounts, bank accounts, and cash management accounts;
  • Organizational documents, minute books, and equity securities of the Sellers;
  • Excluded Contracts and Excluded Claims;
  • Employee Benefit Plans, 401(k) plans, and confidential personnel records prohibited from disclosure by law;
  • Insurance policies (unless specifically included) and professional retainers; and
  • Rights of the Sellers under the APA.
• Assumed Liabilities consist of:
  • Liabilities arising under Assigned Contracts becoming due from and after the Closing;
  • Cure Costs payable with respect to Assigned Contracts;
  • Obligations under the Customer Program (gift cards), regardless of issuance date;
  • Property taxes and other taxes assessed with respect to Purchased Assets for periods ending after the Closing Date; and
  • Costs associated with providing adequate assurance of future performance.

Stalking Horse Bid

• The Buyer has been designated as the Stalking Horse Bidder.
• The total Purchase Price is projected to be approximately $18.8 million, comprised of:
  • A Credit Bid of the aggregate Senior Secured Prepetition Obligations and DIP Obligations;
  • The assumption of Assumed Liabilities;
  • Payment of any applicable Cure Costs; and
  • A transaction fee payable to Stout in the amount of $630,000.

Credit Bid

• Effective as of the Closing, the Buyer shall be deemed to have credit bid the full amount of the Senior Secured Prepetition Obligations and DIP Obligations pursuant to section 363(k) of the Bankruptcy Code.

Bid Protections

• Break-Up Fee: $340,000.
• Expense Reimbursement: Up to $50,000 for reasonable, documented out-of-pocket fees and expenses.

Auction Details

• The Debtors marketed the Purchased Assets in compliance with the Bidding Procedures Order.
• Following the expiration of the Bid Deadline, the Debtors, in consultation with their professionals and the Committee, determined that no other Qualified Bids were received.
• Consequently, the Auction was deemed unnecessary, and the Stalking Horse Bid was selected as the Winning Bid.

Assumption and Assignment

• The Debtors have filed a Cure Notice listing executory contracts and unexpired leases potentially designated as Assigned Contracts, along with proposed Cure Costs.
• The Buyer retains the right to modify the designation of any contract as "Included" or "Excluded" until the Closing.
• The Debtors are authorized to assume and assign the Assigned Contracts to the Buyer effective upon Closing, subject to the payment of applicable Cure Costs and the provision of adequate assurance of future performance.

Sale Free and Clear & Successor Liability

• The assets are being sold free and clear of all liens, claims, encumbrances, and interests, except for Assumed Liabilities and Permitted Liens.
• The Buyer is not considered a successor to the Debtors or their estates, nor is it an alter ego or continuation of the Debtors.
• The Buyer assumes no liability for the Debtors' obligations—including those related to labor, employment, ERISA, or environmental laws—except as expressly provided in the APA.

Post-Closing Arrangements

• The Buyer and Sellers may negotiate a Transition Services Agreement to facilitate the provision of services following the Closing.
• The Buyer will provide Sellers and their representatives with reasonable access to records included in the Purchased Assets for purposes of liquidation, winding up, and tax reporting for a period of up to seven years.

Key Dates

• Sale Order Deadline: December 29, 2025.