lewis roca and
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787236.01
40 North Central AvenuePhoenix, Arizona 85004-4429Facsimile (602) 262-5747Telephone (602) 262-5311
Randolph J. Haines – State Bar No. 005440E-mail: [email protected]
AKIN, GUMP, STRAUSS, HAUER & FELD, L.L.P.1900 Pennzoil Place – South Tower711 LouisianaHouston, Texas 77002Telephone (713) 220-5800Facsimile (713) 236-0822
H. Rey Stroube, III-Texas State Bar No. 19422000S. Margie Venus-Texas State Bar No. 20545900
Attorneys for Debtor BCE West, L.P., et al.
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LEWISAND
ROCALLP
L A W Y E R S
UNITED STATES BANKRUPTCY COURT
DISTRICT OF ARIZONA
In Re:
BCE WEST, L.P., et al.,
Debtors.
EID: 38-3196719
))))))))))))))
Chapter 11
Case Nos. 98-12547 through98-12570-PHX-CGC
Jointly Administered
DEBTORS’ MOTION FORAUTHORITY TO EMPLOY ANDCOMPENSATE PROFESSIONALSUTILIZED IN THE ORDINARYCOURSE OF BUSINESS
BCE West, L.P., Boston Chicken, Inc., Mayfair Partners, L.P., BC Great Lakes,
L.L.C., BC GoldenGate, L.L.C., B.C.B.M. Southwest, L.P., BC Boston, L.P., BC Superior,
L.L.C., BC Heartland, L.L.C., BC Tri-States, L.L.C., Finest Foodservice, L.L.C., BC New York,
L.L.C., R&A Food Services, L.P., P&L Food Services, L.L.C., Mid-Atlantic Restaurant Systems,
Inc., BCI Massachusetts, Inc., BCI Southwest, Inc., BC Real Estate Investments, Inc., BCI
Mayfair, Inc., Progressive Food Concepts, Inc., BCI R&A, Inc., BCI West, Inc., BCI Acquisition
Sub, L.L.C., and Buffalo P&L Food Services, Inc., debtors and debtors in possession (the
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"Debtors"), file this Motion for Authority to Employ and Compensate Professionals Utilized in the
Ordinary Course of Business and Request for Expedited Hearing, and in support thereof, the
Debtors state as follows:
I. JURISDICTION
1. Pursuant to 28 U.S.C. §§ 1334 and 157, the Court has jurisdiction to hear this
Motion. Pursuant to 28 U.S.C. § 157(b)(2)(A) and (O), the Motion presents a core proceeding.
II. BACKGROUND
2. On October 5, 1998 ("Petition Date"), the Debtors filed voluntary petitions for
relief under Chapter 11, Title 11 of the United States Code (the "Bankruptcy Code”), in the United
States Bankruptcy Court for the District of Arizona (the "Court”). Pursuant to sections 1107(a)
and 1108 of the Bankruptcy Code, the Debtors are operating their businesses and managing their
property as debtors in possession.
3. No trustee or examiner has been appointed, and no official committee of creditors
or equity interest holders has yet been established.
4. Boston Chicken, Inc. (“BCI”) and certain of the other Debtors operate restaurants
under the Boston Market brand name. Additionally, BCI franchises Boston Market restaurants.
BCI also currently owns a 51.2% interest in Einstein/Noah Bagel Corp., a publicly traded operator
of approximately 543 specialty retail bagel stores.
5. As of the Petition Date, the Boston Market system included 965 restaurants located
in 36 states and the District of Columbia. The Debtors own and operate 759 of these restaurants.
Three independent financed area developers own a total of 195 restaurants that are franchised by
BCI and 11 restaurants are owned by individual franchisees. As of the Petition Date, BCI and its
subsidiaries employed approximately 18,500 employees.
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III. RELIEF REQUESTED
6. Prior to the Petition Date, Boston Chicken, Inc., Mayfair Partners, L.P., BC Great
Lakes, L.L.C., BC GoldenGate, L.L.C., B.C.B.M. Southwest, L.P., B.C. Boston, L.P., BC
Superior, L.L.C., BC Heartland, L.L.C., BC Tri-States, L.L.C., Finest Foodservice, L.L.C., BC
New York, L.L.C., R&A Food Services, L.P., P&L Food Services, L.L.C., BCE West, L.P., Mid-
Atlantic Restaurant Systems, Inc., BC Real Estate Investments, Inc., and BCI Acquisition Sub,
L.L.C. (“Movants”) in the normal operation of their business employed various professionals to
render services relating to the numerous issues that arose in the Movants’ business (“Ordinary
Course Professionals”). Because the Movants are operating as debtors in possession under the
Bankruptcy Code, the services of the Ordinary Course Professionals continue to be required and
utilized to keep the businesses operating.
7. The services provided by the Ordinary Course Professionals include legal services
and other special consultants such as tax consultants. A list of Movants’ current Ordinary Course
Professionals is attached hereto as Exhibit “A”. The Movants cannot continue to operate their
businesses in accordance with sound business practice unless they retain and pay for the services
of the Ordinary Course Professionals, in the same manner as was customary prior to the Petition
Date. The operation of the Movants’ businesses would be severely hindered if the Movants were
required (i) to submit to the Court an application, affidavit and proposed retention order for each
Ordinary Course Professional and for each professional that may be retained by an Ordinary
Course Professional; (ii) to wait until such order is approved before such Ordinary Course
Professional continues to render services; and (iii) to withhold payment on the normal fees and
expenses of these Ordinary Course Professionals until the Court has approved interim fee
applications.
8. Moreover, it is clear that requiring the Ordinary Course Professionals to file such
retention pleadings and await the fee application process similar to counsel for the Movants and
other bankruptcy professionals, the clerk’s office, the Court and the U.S. Trustee’s office would
be flooded with unnecessary fee applications. This Motion proposes a procedure to alleviate such
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burden.
9. The Movants request that the Court approve the Movants’ employment of the
Ordinary Course Professionals listed on Exhibit “A”, on terms substantially similar to those in
effect prior to the Petition Date, without requiring the submission of separate retention pleadings
for each Ordinary Course Professional.
10. Further, the Movants request that the Court authorize the Movants to employ new
Ordinary Course Professionals and to expand the scope of employment of current Ordinary
Course Professionals, as the need arises in the day to day operation of their businesses, without
the necessity of retention pleadings for each such retention or expansion of the scope of services.
11. Moreover, the Movants request that the Court approve payment of the fees and
expenses of the Ordinary Course Professionals in the same manner as paid prior to the Petition
Date. Prepetition, the Movants paid most of their Ordinary Course Professionals upon receipt of
invoices. In the case of certain professional fees, the Movants pay a fixed annual fee or a monthly
flat rate.
12. The request herein also includes Ordinary Course Professionals who, in turn,
employ professional persons as part of the services being provided to the Movants. For example,
attorneys representing the Movants in a lawsuit may need to hire experts or other professional
witnesses to properly represent the Movants’ interest. Again, it would be an unnecessary burden
on the Movants, the court and the creditors to require the professionals retained by Ordinary
Course Professionals to file separate retention pleadings. The Movants request that the Ordinary
Course Professionals be specifically authorized to retain and compensate such experts that the
Ordinary Course Professionals would employ without separate retention pleadings or the filing of
fee applications.
13. The procedures for employment and compensation of Ordinary Course
Professionals is not unusual given the size of the Movants’ estates and the magnitude of the
Movants’ business. Similar relief has been granted by United States Bankruptcy Courts in other
large bankruptcy matters, including the Court in the MCorp Chapter 11 cases, the United States
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Bankruptcy Court of the Northern District of Texas; in the Western Company of North American
Chapter 11 cases; as well as other large reorganization cases including Texaco, Inc., Circle K
Corporation in Phoenix, Arizona, and Insilco Corporation in Midland, Texas.
14. As a practical matter, the Movants cannot operate their businesses in the ordinary
course if there is any delay in the retention and payment of Ordinary Course Professionals. Such
delay could seriously interfere with the Movants’ ability to respond to the numerous legal,
financial and other issues to which the Movants’ Ordinary Course Professionals must respond on
a daily basis. Any delay would further prejudice the Movants’ ability to conduct their businesses
in accordance with prudent business judgment and sound business practice.
15. The Movants and their respective estates would be better served by authorizing the
retention of the Ordinary Course Professionals because of such professionals’ past relationship
and understanding of the Movants and their operations. Moreover, Ordinary Course Professional,
such as attorneys representing the Movants, have intimate knowledge of specific business and
legal issues which would be lost and require retraining and reeducation by any new Ordinary
Course Professionals that might be retained. Clearly, it is in the best interest of all the parties and
the creditors to avoid any disruption in the professional services rendered by the Ordinary Course
Professionals in the day to day operation of the Movants’ business. Ordinary Course
Professionals that the Movants’ may employ in the future would be selected according to the
Movants’ policies and procedures.
16. The vast majority of the Ordinary Course Professionals are compensated hourly.
In many instances, the Ordinary Course Professionals were owed fees by the Movants as of the
Petition Date. However, because the Ordinary Course Professionals are being retained as
“special” professionals, Bankruptcy Code § 327(e) permits their continued retention by waiving
the “disinterestedness” test provided in Bankruptcy Code § 327(a). The Movants do not believe
that any prepetition claims owing to the Ordinary Course Professionals will hamper or delay the
Ordinary Course Professionals from providing the services to the Movants post-petition, as such
Ordinary Course Professionals rendered on a prepetition basis. The Movants are not requesting
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authority to pay any prepetition amounts owing to such Ordinary Course Professionals.
WHEREFORE, the Movants respectfully request that the Court (i) enter an order
authorizing Movants to employ and compensate the Ordinary Course Professionals on the terms
and conditions set forth above, (ii) authorizing the Ordinary Course Professionals to retain and
compensate such professionals as are required, and (iii) authorizing the Movants to employ and
compensate new Ordinary Course Professionals in accordance with the Movants’ policies and
procedures, and (iv) for such other relief to which the Movants are entitled.
Respectfully submitted this 7th day of October, 1998.
DEBTORS AND DEBTORS IN POSSESSION
By: /s/Randolph J. Haines One of their Attorneys
AKIN, GUMP, STRAUSS, HAUER & FELD, L.L.P.
H. Rey Stroube, III S. Margie Venus 1900 Pennzoil Place – South Tower 711 Louisiana Houston, Texas 77002 (713) 220-5800 (713) 236-0822 (fax) - and -
LEWIS AND ROCA LLP Randolph J. Haines 40 North Central Avenue Phoenix, Arizona 85004-4429 (602) 262-5764
(602) 262-5747 (fax)e-mail: [email protected]
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CERTIFICATE OF SERVICE
The undersigned hereby certifies that on October 7, 1998 the foregoing document wasserved by first class United States Mail, postage prepaid, on all parties on the Master Service List#1 dated October 5, 1998.
Marilyn Schoenike
