The Celsius Network bankruptcy cases provide another opportunity for parties to acquire their assets and/or operations. As predicted in an earlier post, the bankruptcy court issued an order in the Celsius cases, approving bidding procedures that outline the entire process and steps to be followed by anyone interested in submitting a bid.

Anyone interested in buying assets or operations from Celsius will need to follow the process outlined in the order to connect with the advisors to Celsius, sign a nondisclosure agreement (NDA), and structure a bid with the bid requirements to become a Qualified Bid* as defined in the order.  

Submitting a Qualified Bid would allow the bidder to either win the bidding if no competing bids are received, or to attend the auction to participate in further bidding. Submitting a Qualified Bid is a serious undertaking, requiring a good faith deposit in cash equal to 10% of the cash consideration of the bidder’s offer. The cash will be held in an escrow account until the sale process concludes. Celsius reserved the right to require a Qualified Bidder to increase its deposit if the bid is changed before or after the auction, so the deposit would equal 10% of the increased Purchase Price.

The Bid Requirements for a bid to be a Qualified Bid are listed beginning on page 19 of the order.

Bidding Timeline:

            September 21           Deadline to submit Qualified Bids

            September 23           Auction begins (if competing bids submitted)

            September 29           Deadline to file objections to sale

            October  6                 Sale Hearing before bankruptcy court

The Bankruptcy Code enables bankruptcy courts to order that assets may be sold free and clear of preexisting liens, claims, interests, and encumbrances. Such orders provide buyers with a federal court ruling determining them to be the absolute owner of the assets sold and finding that the buyer proceeded with the acquisition in good faith. Those orders generally provide that the claims against the debtors and their assets attach to the sale proceeds and that the purchased assets will be free from those claims (subject to infrequent exceptions).

A hearing to consider a possible sale in the Voyager cases is now scheduled for a week before the Celsius Sale Hearing, with a possible auction on September 13. That sale may provide insights for the Voyager sale.

*Capitalized terms are defined in the order.

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