Declaration of Neil Minihane - Doc 21

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Joseph A. Friedman (State Bar No. 07468280) Jason B. Binford (State Bar No. 24045499) KANE RUSSELL COLEMAN & LOGAN PC 3700 Thanksgiving Tower 1601 Elm Street Dallas, Texas 75201 Telephone - (214) 777-4200 Telecopier - (214) 777-4299 Email: ecf@krcl.com PROPOSED ATTORNEYS FOR DEBTORS ALL SMILES DENTAL CENTER, INC. AND AS PROPERTY HOLDINGS, LLC
THE UNITED STATES BANKRUPTCY COURT FOR THE NORTHERN DISTRICT OF TEXAS DALLAS DIVISION IN RE: ALL SMILES DENTAL CENTER, INC., and AS PROPERTY HOLDINGS, LLC DEBTORS.
CASE NO. 12-32924-SGJ-11 CASE NO. 12-32925-HDH-11 Motion for Joint Administration Pending
DECLARATION OF NEIL MINIHANE IN SUPPORT OF FIRST DAY MOTIONS Pursuant to 28 U.S.C. 1746, I, Neil Minihane, declare the following to be true and correct under penalty of perjury: 1. My name is Neil Minihane. I am over twenty-one (21) years of age and reside in
the State of Colorado. I have never been convicted of a felony or any other crime involving moral turpitude. I am fully competent to make this affidavit. I have personal knowledge of the facts set forth in this affidavit and those facts stated are true and correct. 2. I am employed as the Interim President of All Smiles Dental Center, Inc. ("Inc.")
and I have been authorized by Inc. to make this declaration on behalf of Inc. and its wholly owned subsidiary AS Property Holdings, LLC ("LLC", collectively with Inc., the "Debtors").
_________________________________________________________________________________________________________ DECLARATION OF NEIL MINIHANE Page 1 of 18 1706562 v4 (76740.00002.000) IN SUPPORT OF FIRST DAY MOTIONS
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BACKGROUND A. The Bankruptcy Case 3. On May 2, 2012 (the "Petition Date"), the Debtors each filed voluntary petitions
in accordance with Chapter 11 of the United States Code (the "Bankruptcy Code"). Since the Petition Date, the Debtors have continued to operate as debtors-in-possession pursuant to sections 1107 and 1108 of the Bankruptcy Code. B. History of the Debtors 4. Inc. is a Delaware corporation formed on September 11, 2008. Inc. is
headquartered in Dallas, Texas and is a dental practice management service organization (an "MSO") supporting 33 dental and orthodontic practices within Texas. The practices are at 22 different physical locations spanning the Dallas, Fort Worth, and Houston metropolitan areas. All Smiles Dental Professionals, P.C. ("PC") employs the clinical staff and provides all dental and orthodontic services at these practices. 5. Richard J. Malouf, D.D.S. ("Dr. Malouf") founded Inc. in 2002 as All Smiles
Dental Center, P.A., which he converted to a Delaware corporation in 2008 to operate as an MSO, and then also formed the PC to provide clinical services. At that time, Dr. Malouf and The Richard J. Malouf 2008 All-Smiles Grantor Retained Annuity Trust (the "2008 Trust", and, collectively with Dr. Malouf, the "Malouf Parties") held all Inc. stock and Dr. Malouf held all PC stock. 6. Inc. and PC are parties to a Business Services Agreement (the "BSA"), under
which Inc. provides management services to PC. The management services include (but are not limited to): financial services (e.g., billing and collections, bookkeeping, accounting, tax
services, etc.); human resources (e.g., dentist and staff recruiting, payroll services, etc.);
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information technology; logistics (e.g., equipment and supplies procurement, facilities leasing, repair and maintenance services, capital improvements, etc.); operations (e.g., management of the offices, marketing and public relations, etc.); and compliance (e.g., operating a compliance program, legal coordination, governmental affairs, licensing, permitting, etc.). In exchange for these services, PC reimburses Inc. for certain advances and pays Inc. a management fee from which Inc. funds its operations. The BSA is specifically intended to comply with restrictions against the corporate practice of dentistry as set out in the Texas Dental Practices Act and the State Board of Dental Examiners ("SBDE") Rules (specifically, SBDE Rule 108.70). Among other things, as an MSO, Inc. does not treat patients or provide diagnostic services. All
diagnosis, treatment, and care of patients is provided by PC. As such, I do not believe Inc. is a health care business as that term is defined in the Bankruptcy Code. PC is the sole client of Inc. C. The June 2010 Acquisition of the Debtors by ASDC Holdings, LLC 7. Pursuant to a Note and Stock Purchase Agreement (the "NSPA") dated June 30,
2010, by and between ASDC Holdings, LLC ("Holdings"), Holdings acquired approximately seventy percent (70%) of the outstanding equity interest of Inc. (the "Holdings Acquisition"). In connection with the Holdings Acquisition and in accordance with the NSPA, Inc. issued notes payable to Holdings in the total original principal amount of approximately $54,463,000.00 as more fully described below. PC is currently wholly owned by Adrian Codel, D.D.S. 8. Dr. Malouf remained on the board of Inc. after the Holdings Acquisition. He
resigned from the Inc. board as of April 19, 2012. D. The Debtors' Debt Structure 9. Holdings is owner and holder of a Secured Promissory Note in the original
principal amount of $53,963,278.49 dated June 30, 2010 (the "2010 Note"), made by Inc., as
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borrower, and Holdings, as lender. The maturity date of the 2010 Note is June 30, 2017. The 2010 Note is secured by substantially all of Inc.'s assets (the "Collateral"), as set forth in a Security Agreement, dated June 30, 2010, granted by Inc. for the benefit of Holdings (the "2010 Security Agreement") and the financing statement (the "2010 Financing Statement") recorded with the Delaware Secretary of State by Holdings on July 1, 2010 (File No. 20102313173).1 10. Holdings is also the owner and holder of a Secured Promissory Note in the
original principal amount of $1,000,000 dated January 9, 2012 (the "2012 Note"), made by Inc., as borrower and Holdings, as lender. The maturity date of the 2012 Note is April 6, 2012. The 2012 Note is secured by the Collateral, as set forth in a Security Agreement, dated January 9, 2012, granted by Inc. for the benefit of Holdings (the "2012 Security Agreement") and the financing statement (the "2012 Financing Statement") recorded with the Delaware Secretary of State by Holdings on January 9, 2012 (File No. 20120096380). 11. The 2010 Note, 2010 Security Agreement, 2010 Financing Statement, 2012 Note,
2012 Security Agreement, and 2012 Financing Statement shall collectively be referred to herein as the "Pre-Petition Loan Documents". 12. As of the Petition Date, Inc. owed Holdings approximately $61,415,930.30
consisting of $60,393,902.51 owed under the 2010 Note, including $6,430,624.02 of unpaid interest due and $1,022,027.79 owing under the 2012 Note, including $22,027.79 of unpaid interest due (the "Pre-Petition Indebtedness").
From and after June 30, 2010, Holdings sent Inc. a series of letters acknowledging a delayed schedule of required payments due by Inc. and stating that such unpaid payments did not constitute an "Event of Default" under the 2010 Note.
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E.
Events Leading to the Debtors' Chapter 11 Filing (1) 13. Federal Investigation and Compliance Efforts In 2008 (before the Holdings Acquisition) the Office of the Inspector General of
the U.S. Department of Health and Human Services (the "FED-OIG") began an investigation of Inc. and PC regarding orthodontic services provided to Texas Medicaid patients from July 20, 2004 through September 6, 2007. As a result, Inc. has been in constant contact through counsel with the FED-OIG, spending millions of dollars on legal representation while negotiating what became a Corporate Integrity Agreement between Inc. and the FED-OIG ("CIA") and Settlement Agreement among the United States, the State of Texas, Dr. Malouf, and Inc. 14. On March 20, 2012, the parties finalized the CIA and Settlement Agreement and
brought this investigation to an end. Without admitting any wrongdoing, Inc. and Dr. Malouf agreed to pay $1.2 million to the federal government while Inc. agreed to institute and maintain an expensive and robust compliance program (including engaging an independent review organization to conduct an annual audit of claims submitted to Medicaid). 15. Following the Holdings Acquisition, Inc.'s Board of Directors and management
invested significant resources in its compliance program (including employing a Chief Compliance Officer, establishing an internal auditing team, and developing and maintaining numerous patient quality of care processes and billing and collection procedures). (2) 16. Legacy Expansion Costs Inc.'s challenges are compounded by an aggressive 2010 expansion of office
locations. Beginning under the ownership of the Malouf Parties, Inc. undertook an aggressive expansion that effectively doubled the number of offices over a period of 18 to 24 months. The expansion plan, however, was poorly executed. As a result, construction costs ballooned and the
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new offices were unprofitable. From the summer of 2011 through the winter of 2011, Inc. closed the unprofitable offices or those without hope of restoring profitability in the short term. Unfortunately, Inc. still carries these office leases on its books and they are draining resources from the healthy part of the business. As set forth below, as part of first day relief, Inc. will seek to immediately reject many of these Leases and expects to reject other leases during the course of this Chapter 11 proceeding. The excessive construction costs also reduced cash balances and put further pressure on Inc. to address past payables and mechanics liens. (3) 17. Caymus Litigation As noted above, on June 30, 2010, the Malouf Parties sold a controlling interest in
Inc. to Holdings. As also described above, Holdings capitalized Inc. with a mix of equity, senior secured debt, and subordinated debt. 18. During the time that the Malouf Parties owned Inc., Dr. Malouf entered into an
agreement (the "Brokerage Agreement") with Caymus Partners LLC ("Caymus"), an investment banking firm, to represent and market Inc. for sale to potential buyers. It was Caymus that introduced Holdings to the Malouf Parties. After the close of sale, a dispute arose between Holdings and the Malouf Parties as to whether the Malouf Parties owed a transaction commission fee to Caymus under the Brokerage Agreement. When the claimed fee went unpaid, Caymus pursued Inc. (as the counter-party to the Brokerage Agreement) for settlement while Inc. pursued the Malouf Parties for resolution. 19. Before Holdings and the Malouf Parties dispute could be resolved, Caymus
obtained a $3.4 million arbitration judgment against Inc. and began collection efforts on February 27, 2012. On March 12, 2012, the Dallas County Constable showed up at Inc.'s
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corporate headquarters to execute a writ of judgment. Inc. and Caymus have been in discussion since March 12, 2012 on how to resolve this judgment with little progress. (4) 20. Orthodontic Business Decline In addition to the 2008 federal government investigation, dental and orthodontic
centers servicing the Medicaid community in Texas became the subject of various local television investigative news reports in the summer of 2011. These reports were extraordinarily negative and alleged various types of misconduct. One story focused specifically on Dr. Malouf and made various allegations about the current ownership and management of Inc. 21. There were various reactions to these reports. PC experienced a decline of patient
visits during this period. Various independent school districts refused to allow PC to provide its mobile dentistry services specifically because of the reports. The Texas Health and Human Resources Commission ("HHSC") engaged in a comprehensive re-evaluation of the Medicaid orthodontic program and the HHSC Office of Inspector General (the "TX-OIG") began reviewing past and current orthodontic care authorization requests. As a result, the number of orthodontic starts (i.e., the number of procedures for braces authorized by Texas Medicaid and provided to the patients) dropped from an average of 320 per month to zero over a 60-day period. 22. At this time, Inc. supported almost 20 orthodontic offices, but the decline in
patient volume and the lack of new orthodontic authorizations required a process of retrenchment beginning in the fall of 2011. Eventually, Inc. completed a reorganization of the orthodontic practice with seven teams of clinicians operating out of 13 offices on a rotating basis. Inc. and PC implemented this reduction in force (the "RIF") primarily in February 2012, and released, respectively, approximately 50% of the orthodontic office and support staff and 50% of the
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orthodontic doctors and clinical staff.
Inc. also consolidated physical locations, and PC
completed appropriate patient treatment transfers or dismissals. 23. Even with the RIF and consolidation, the remaining orthodontic business operated
at a net loss. PC and Inc. attempted to diversify the patient base of the orthodontic business. This sort of transition can take years and is typically a phased effort because of the significant capital required to build a business. The transition to a cash and private insurance orthodontic business would be a strategic shift for PC as historically over 90% of the orthodontic revenue came to PC from services to Medicaid patients. (5) 24. MCO Transition In 2011, the State of Texas changed the management of Medicaid dental care
services (both general dentistry and orthodontic). HHSC awarded contracts to three Managed Care Organizations ("MCOs") to administer Texas Medicaid dental claims. The three MCOs operate more like traditional insurance carriers with corresponding treatment pre-authorizations and new policy and procedure requirements. Additionally, the payment terms of each of the MCOs are different and all have payment terms substantially longer than the previous Texas Medicaid dental payer under whom days sales outstanding averaged close to 13 days. 25. The transition to the three MCOs was challenging to Inc. and PC. Enrollment
materials to Medicaid beneficiaries were largely ignored. MCO-specific policies were published only weeks before the March 1, 2012 implementation. Websites for patient management were not available prior to the implementation date. Administrative requirements for claims
submissions were burdensome (e.g., one MCO only accepts hard copy claims sent through the mail). Patients were mis-assigned to providers.
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26.
In total, the transition to MCO was detrimental to Inc. and PC's financial position.
The transition to MCOs has resulted in disrupted operations, stretched out the claims approval process, and lengthened the payment cycle for PC, and in turn, impacted PC's ability to pay Inc. Coupled with increased patient missed visits due to market confusion, the MCO transition significantly impacted the PC's business and cash flow, and had a corresponding impact on Inc. 27. In anticipation of the payment term changes, Inc. maintained a cash balance and
made arrangements for bridge loans so it could support PC. Unfortunately, the dramatic change in account receivable terms depleted the remaining cash balance on Inc.'s balance sheet. Much like a run on the bank, the "cash" balance shifted from Inc. to the MCOs (e.g., one MCO has yet to process or pay many of the claims submitted almost seven weeks after the implementation date). The MCOs delaying payment to PC for the patient care services, has resulted in PC being unable to compensate Inc. for the management services. (6) 28. State Investigation In late 2011, the TX-OIG began a series of audits of Medicaid orthodontic
providers (including PC). The TX-OIG requested documents from PC on September 21, 2011 for claims submitted from eight offices from September 2007 through June 2011. PC delivered the requested information to the TX-OIG in October 2011. 29. On March 29, 2012, the TX-OIG sent a notice to Inc. and PC's counsel, which
was forwarded to Inc. on March 30, 2012, alleging that excessive orthodontic care was requested, authorized, and provided to Medicaid patients and that PC owed the State of Texas monies to reimburse the State for these allegedly inappropriate services. The notice went on further to explain that the TX-OIG was, effective immediately, suspending claims reimbursement to PC for the eight clinic locations associated with the audit.
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30.
Those eight affected locations account for about 45% of PC's revenue and hence
Inc.'s revenue in March 2012. Without the release of the payment hold and reimbursement of on-going dental care services, PC cannot pay Inc. for the management services, and Inc. can no longer continue to provide these services. 31. forward. (7) 32. Management and Operations Changes Throughout the events described above, Inc.'s management attempted to stabilize PC has begun discussions with the TX-OIG regarding an appropriate path
its business while pursuing its rights and fulfilling its obligations. 33. PC experienced declining revenues throughout 2011, and this correspondingly
impacted Inc. By the summer of 2011, Inc. was unable to meet its regularly scheduled debt service payment to Holdings as its secured lender, but was able to secure a short forbearance period. Shortly thereafter, Inc.'s Board of Directors terminated the Chief Executive Officer, employed new regional operations directors for the offices, and reorganized Inc.'s operations. During this time, Inc. has worked closely with Holdings on plans to address the situation. 34. In February 2012, Inc.'s Chief Financial Officer and acting President resigned and
Inc. retained my professional consulting company, Turn Works LLC ("Turn Works"), to provide leadership and operational direction to Inc. and named myself as Interim President. Shortly thereafter, the above confluence of events led to an unanticipated and accelerated downward spiral in Inc.'s cash balance and operational profitability. 35. Inc. remains fully committed to complying with the intent of the CIA to the extent
of its resources and to assisting PC in providing the appropriate high quality dental care to the patients. In order to be in a position financially to do so, Inc. has commenced a Chapter 11
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proceeding in an effort to restructure its existing debt obligation, achieve appropriate resolution over its revenue holds, and preserve its assets and operations for the benefit of creditors and PC's patients. F. The Alleged Events of Default 36. On March 20, 2012, counsel for Holdings sent Inc. two letters alleging that events
of default has occurred under both the 2010 Note and the 2012 Note relating to: (1) the judgment obtained by Caymus; and (2) Inc. allegedly allowing its EBIDTA to fall below a certain point. Holdings further alleged in the March 20, 2012 letters that any applicable cure period had expired, that the entire debt due under the 2010 Note and the 2012 Note was immediately due and payment, and that Holdings intended to exercise its rights against the Collateral. 37. As of the Petition Date, Inc. has been unable to negotiate a forbearance with
Holdings or otherwise to refinance the 2010 Note or the 2012 Note. The Debtors therefore filed these cases to preserve value of the Debtors' estates for the benefit of creditors and equity holders. SUBSTANTIVE FIRST DAY MOTIONS FOR EXPEDITED CONSIDERATION 38. I submit this affidavit in support of the following substantive first day motions
listed below (the "Substantive First Day Motions"). I have read and reviewed each of the Substantive First Day Motions and it is my opinion that the expedited relief requested in the First Day Motions is necessary to promote the efficient administration of the Debtors' cases and to avoid immediate and irreparable harm to the Debtors and their estates.
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A.
Motion for Order (I) (A) Authorizing Secured Post-Petition Financing Pursuant to 11 U.S.C. 105, 363, and 364(c) and (d), (B) Granting Secured Interests, Superpriority Claims, and Adequate Protection, and (C) Authorizing the Debtors' Use of Cash Collateral; and (II) Scheduling a Final Hearing Pursuant to Bankruptcy Rule 4001(c) (the "DIP Financing and Cash Collateral Motion") 39. Due to the uncertainty surrounding PC's ability to collect its receivables due to the
hold in place by the TX-OIG, I have lacked any reasonable ability to project revenues or an ability to fund operations. As a result, on behalf of Inc., I have not been able to present a business plan to any lender concerning post-petition financing for Inc. In fact, Holdings had declined to even entertain post filing financing due to the uncertainty regarding the TX-OIG position. 40. In the last few days leading up to the Petition Date, however, Inc. has made
significant progress with the TX-OIG concerning the release of payments currently on hold. As a result, on an interim basis, Holdings has been willing to advance funds under a debtor-inpossession financing facility as more fully described in the DIP Financing and Cash Collateral Motion. B. Motion to Approve Payment of Pre-Petition Wages, Taxes and Benefits and to Continue Employee Programs in the Ordinary Course of the Debtors' Business (the "Wage and Benefits Motion") 41. All 137 of the Debtors' employees are employees of Inc. (the "Employees"). As a
consequence of the filing of these cases, the Debtors are prohibited from paying claims that arose prior to the Petition Date, including the portion of Employee claims that will be paid in the first post-petition payroll (the "Employee Claims"). That payroll will be funded by Inc. to ADP, Inc. ("Inc.") on May 11, 2012 (the "May 11 2012 Payroll"). In addition, the Debtors make certain other payments related to the Employees in the ordinary course of business, including reimbursing expenses, payment of federal, state, and local taxes, social security taxes, and
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Medicare taxes, as well as payments of PC's employees' expense reports pursuant to a Business Services Agreement between Inc. and PC (collectively, the "Employee Programs"). 42. The success of the Debtors' efforts to reorganize effectively is dependent on the
continued employment and sustained morale of their employees. To maintain employee stability and productivity, it is important that Employee Claims be paid in full, and that the Employee Programs are continued post-petition. C. Motion for Authority to (1) Pay Pre-Petition Obligations Under Insurance Policies; (2) Continue to Administer Insurance Policies; and (3) Pay Premiums and Claims as They Come Due (the "Insurance Motion") 43. The Debtors are parties to, or beneficiaries of, the insurance policies set forth in
the Insurance Motion, including a workers' compensation policy, general liability policy, umbrella policy, automobile policy, flood insurance, directors and officers liability policy (collectively, the "Insurance Policies"). The Debtors do not believe that there are any claims
coming due or other payment obligations relating to pre-petition coverage or claims (the "PrePetition Obligations"). However, certain claims, deductible payments, or other obligations may arise in the ordinary course of business that relate to pre-petition coverage. 44. The Debtors are seeking authority, in their reasonable business judgment, to pay
Pre-Petition Insurance Obligations and to continue to pay premiums and claims under the Debtors' Insurance Policies to the extent that they become due and payable according to the terms of such polices. This relief is essential to the continued operations of the Debtors' business.
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D.
Motion for Entry of an Interim Order (1) Determining Procedure for Adequate Assurance of Payments for Future Utility Services; and (2) Setting a Final on Determination of Deposits to Prevent Utility Companies from Discontinuing, Altering, or Refusing Service (the "Utilities Motion") 45. Bankruptcy Code section 366 requires the Debtors to provide its utility service
providers (the "Utility Companies") with "adequate assurance of payment". 46. It is essential that the Utility Services continue uninterrupted. If the Utility
Companies are permitted to terminate Utility Services, substantial harm to the Debtors' business will occur and the Debtors' business will be irreparably harmed. Therefore, the Utilities Motion seeks an order approving adequate assurance of payment in the form of an average of two weeks' utility services (the "Utility Services") billing. The Utilities Motion also seeks to put into place a procedure by which the Utility Companies may object to the proposed adequate assurance of payment. E. Motion to Reject Unexpired Leases of Non-Residential Real Property (the "Motion to Reject Leases") 47. The Debtors lease and manage certain properties for operations of various dental
clinics by PC, as well as other locations managed by the Debtors in furtherance of PC's operations. LLC is party to certain leases of non-residential real property (the "Leases") for premises where PC no longer operates. Prior to the Petition Date, the Debtors vacated these premises and returned the keys and key codes to the respective landlords. 48. I believe the rents under the Leases are at or above market. I do not believe there
is any residual value to the Leases. I have conferred with Holdings, and they support rejection of the Leases. 49. The Debtors, in the exercise of their business judgment, seek to reject the Leases,
effective as of the Petition Date. Such rejection is in the best interest of the Debtors' creditors
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and the Debtors' bankruptcy estates because it will limit the accrual of unnecessary administrative expense. F. Motion to Reject Personal Property Lease (the "Motion to Reject Contracts") 50. Inc. is party to a personal property lease (the "Personal Property Lease") with
Deal Time Auto Group, LLC ("Deal Time") whereby Deal Time leased certain automobiles to Inc. (the "Automobiles"). Prior to the Petition Date, Inc. returned the Automobiles to Deal Time. 51. The Debtors, in the exercise of their business judgment, seek to reject the
Personal Property Lease, effective as of the Petition Date. Such rejection is in the best interest of the Debtors' creditors and the Debtors' bankruptcy estates because it will limit the accrual of unnecessary administrative expense. PROCEDURAL FIRST DAY MOTIONS FOR EXPEDITED CONSIDERATION 52. Furthermore, I have read and reviewed each of the procedural first day motions
listed below (the "Procedural First Day Motions"). It is my opinion that the expedited relief requested in the Procedural First Day Motions is also necessary to promote the efficient administration of the Debtors' cases and to avoid immediate and irreparable harm to the Debtors and their estates. A. Motion for Order Directing Joint Administration of the Debtors' Chapter 11 Cases (the "Motion for Joint Administration") 53. The Debtors seek, for procedural purposes only, the joint administration of their
bankruptcy cases. Such joint administration will allow for the efficient administration of the Debtors' cases by, for example, avoiding duplicative pleadings and overlapping service. Joint administration will permit the Clerk of the Court to use a single general docket for each of the Debtors' respective cases and to combine notices to creditors and other parties in interest of the Debtors' respective estates. Joint administration will also protect parties in interest by ensuring
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that all parties in interest will be able to review one docket to stay apprised of the various matters before the Court in each of the Debtors' cases. B. Notice of Designation as Complex Chapter 11 Bankruptcy Cases (the "Notice of Designation") 54. The Debtors qualify under General Order 2006-02 as complex Chapter 11 cases
and therefore are seeking such designation. C. Ex Parte Application for Order Limiting Notice (the "Application to Limit Notice") 55. The Debtors are seeking to establish a limited service list (the "Official Service
List") and are further seeking to approve the form and manner of notice to be transmitted to parties in interest concerning the establishment of the Official Service List. With the number of creditors and parties in interest in these cases, absent the establishment of a limited Official Service List, the Debtors would be required to expend a substantial portion of their assets in copying costs, postage charges and other handling expenses associated with large mailings for all matters covered by Bankruptcy Rule 2002. The Debtors, therefore, are seeking to establish the modified noticing requirements set forth in the Application to Limit Notice in order to limit the administrative costs of maintaining these Chapter 11 cases. D. Motion for Expedited Consideration of Certain First Day Matters (the "Motion for Expedited Consideration") 56. The Debtors are seeking expedited consideration of the motions listed above in
order to maximize and preserve their estates. ADDITIONAL MOTIONS FILED BY THE DEBTORS 57. The Debtors have filed the additional motions below. The Debtors are seeking
prompt, but not expedited, consideration of these additional motions.
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A.
Motion Pursuant to 11 U.S.C. 363 Authorizing the Assumption of Consulting Services Agreement and the Employment of Turn Works LLC and Neil Minihane Pursuant to the Terms of a Consulting Services Agreement Between All Smiles Dental center, Inc. and Turn Works LLC (the "Motion to Employ Minihane") 58. Prior to the Petition Date, my consulting services firm, Turn Works, and I entered
into a Consulting Services Agreement (the "Consulting Services Agreement") with Inc. From and after the Consulting Services Agreement, I acted as an officer of Inc. and as an officer of LLC, in the leadership title of Interim President of the Debtors. 59. By the Motion to Employ Minihane, the Debtors are seeking to assume the
Consulting Services Agreement and to employ Turn Works and me, pursuant to the terms of the Consulting Services Agreement, in the ordinary course of the Debtors' business. As set forth in detail in the Motion to Employ Minihane, the Debtors believe that such retention will greatly benefit the Debtors' estates and creditors. B. Application for Approval of Employment of Kane Russell Coleman & Logan PC as Counsel for the Debtors Pursuant to 11 U.S.C. 327 and 329 (the "KRCL Employment Application") 60. In connection with the performance of their duties and obligations as debtors-in-
possession, the Debtors wish to employ Kane, Russell, Coleman & Logan, P.C. ("KRCL") to serve as bankruptcy counsel. 61. KRCL has been selected as proposed counsel for the Debtors because (i) KRCL is willing
to undertake this representation; (ii) KRCL has sufficient expertise and capacity to handle the numerous and potentially complex issues that will be raised and addressed; and (iii) KRCL does not have a conflict of interest in representing the Debtors in these cases.
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orthodontic doctors and clinical staff.

Inc. also consolidated physical locations, and PC

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prompt, but not expedited, consideration of these additional motions.

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