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Hearing Date and Time: September 6, 2012 at 10:00 a.m.

PACHULSKI STANG ZIEHL & JONES LLP James I. Stang, Esq. 10100 Santa Monica Blvd., 13th Floor Los Angeles, CA 90067-4100 Telephone: 310/277-6910 Facsimile: 310/201-0760 - and PACHULSKI STANG ZIEHL & JONES LLP Ilan D. Scharf, Esq. 780 Third Avenue, 36th Floor New York, NY 10017-2024 Telephone: 212/561-7700 Facsimile: 212/561-7777 Attorneys for Official Committee of Unsecured Creditors of The Christian Brothers Institute and The Christian Brothers of Ireland, Inc. UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK Chapter 11 In re: Case No. 11-22820 (RDD) THE CHRISTIAN BROTHERS INSTITUTE, et al., (Jointly Administered) Debtors. LIMITED OBJECTION OF OFFICIAL COMMITTEE OF UNSECURED CREDITORS TO DEBTORS MOTION FOR ORDERS PURSUANT TO SECTIONS 105(a) AND 363 OF THE BANKRUPTCY CODE AND BANKRUPTCY RULE 6004 APPROVING (I) SALE PROCEDURES AND NOTICE OF THE AUCTION RELATIONG THERETO, (II) SALE OF REAL ESTATE TO IONA COLLEGE OR A PARTY MAKING HIGHER AND BETTER OFFER FREE AND CLEAR OF LIENS, CLAIMS, INTERSTS AND ENCUMBRANCES, (III) APPROVING THE STALKING HOURSE PURCHASE AGREEMENT, AND (IV) GRANTING RELATED RELIEF The Official Committee of Unsecured Creditors (the Committee) for The Christian Brothers Institute (CBI) and The Christian Brothers of Ireland, Inc. (CBOI and, collectively with CBI, the Debtors), the debtors and debtors in possession in the above-captioned cases (the Cases) under chapter 11 of Title 11 of the United States Code (the Bankruptcy Code), by

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and through its undersigned counsel, hereby objects (the Objection) to the sale procedures proposed by CBI in the Debtors Motion for Orders Pursuant to Sections 105(a) and 363 of the Bankruptcy Code and Bankruptcy Rule 6004 Approving (I) Sale Procedures and Notice of the Auction Relating Thereto, (II) Sale of Real Estate to Iona College or a Party Making Higher and Better Offer Free and Clear of Liens, Claims, Intersts and Encumbrances, (III) Approving the Stalking Hourse Purchase Agreement, and (IV) Granting Related Relief (the Motion).1 In support of its Objection, the Committee respectfully states as follows: Limited Objection A. Competing Bidders Should Be Allowed to Bid on Individual Houses 1. CBI seeks to sell six (6) Houses (as defined in the Motion) to Iona College

for $5.0 million. The Houses are all located in New Rochelle within the vicinity of Iona College. CBI negotiated the sale to Iona College without subjecting the Houses to any marketing before executing the contract with Iona College. At the Committees request, the Debtors have sought approval of certain sale procedures in order to test the market. However, the bid procedures require any competing bidder to make a minimum bid of $5.1 million for all of the Houses. The Committee believes that this requirement will chill bidding since all of the Houses appear to be single family residential houses in the same neighborhood. Thus, CBI is more likely to receive competing bids if it allows bidders to bid on individual Houses and then reviews any competing bid(s) in the aggregate against Iona Colleges offer.

The Committee reserves its rights to object to any sale of the Properties (as defined below).

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2.

The Court should only approve bidding procedures if and to the extent

they are revised to provide as follows: a. Bidders may submit bids for any of the Houses or properties subject to the proposed sale to Iona College; Any bid for all of the Houses or properties must be for a cash price equal to or greater than $5.1 million; Any bid for an individual House or property shall have a minimum amount agreed upon by CBI and the Committee (subject to further order of the Court);2 Competing bidders shall submit a good faith deposit of 10% of any bid; CBI, in consultation with the Committee, shall review any competing bids in the aggregate even if such competing bids seek to purchase fewer than all of the Houses; CBI, in consultation with the Committee, shall conduct an auction if they receive a qualified competing bid for all of the Houses; CBI, in consultation with the Committee, may conduct an auction if they receive bids for individual Houses or properties based on a

b.

c.

d.

e.

f.

g.

Section 6 of the Purchase Agreement between CBI and Iona College provides for certain price reductions if CBI is unable to convey any of the individual properties to Iona College, as follos: a. b. c. d. e. f. 33 Beechmont Drive $985,000; 77 Beechmont Drive - $797,000; 21 Pryer Terrace - $867,000; 33 Pryer Terrace - $880,000; 29 Montgomery Place - $693,000; and 53 Montgomery Circle - $778,000.

The Committee believes that each of those amounts is a proper floor for any bid on individual Houses or properties.

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totality of the circumstances and in an exercise of its business judgment. WHEREFORE, based on the foregoing, the Committee respectfully requests that the Court deny the Motion unless the bidding procedures are modified as proposed herein. Dated: New York, New York September 5, 2012

PACHULSKI STANG ZIEHL & JONES LLP

/s/ Ilan D. Scharf Ilan D. Scharf, Esq. 780 Third Avenue, 36th Floor New York, NY 10017 Telephone: (212) 561-7700 Facsimile: (212) 561-7777 James I. Stang, Esq. (admitted pro hac vice) 10100 Santa Monica Blvd., 13th Floor Los Angeles, California 90067 Telephone: (310) 277-6910 Facsimile: (310) 201-0760 Counsel to the Official Committee of Unsecured Creditors of The Christian Brothers Institute and The Christian Brothers of Ireland, Inc.

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