Free Appendix - District Court of Delaware - Delaware

Case 1:04-cv-01565-SLR

Document 138-4

Filed 05/04/2007

Page 1 of 43

REPORtER: LORRIE L MARCHANT. RPR. CRR CSR NQ /fJjn

EXHIBIT: :5

Wo,"~~Wl~ Date:' . # ofpa s:
THIS IS NOT A SOLICITATION OF ACCEPTANCE OR REECTION OF TJlE PLA. ACCEPTANCES OR REJECTONS MAY NOT BE SOLJClTED UNni, Ii mSn.oSUR STATEMENT HA BEE APPROVED llY mE
BANKRUPTCY COURT. THlSDlSa.OSURST ATEENJSBEJGSUBMITTD FORAPPROV ALBUT HA BEEN APPROVE BY THE COURT. ALINFORM nON HERIN lS SUBJECT

NOT

BE RELIED UPON "IN "MAKJNG ANY INVESTMENTTO CHAGE AND SHOUL NOT UR OTH~ DEèiSJON.

__0.0 ~~.
=;

:.i::.~ ~.:.o

IN TIE UND STATES BANUPTCY COURT
FOR TI DISTRICT OF DELAWAR
In re
:.. .

0-' ~:

)

= = =

o

rn ;::

" -.
!

CORAMHEATICARECORP. and CORA, INC.,"
Debtors.

)
)
) ) )

Chapter I J
Case Nos. 00-_ ( ")

through 00-_ ( )

)
)
,0';-.

Jointly Adrrinistered

SECTION.l125 OF

D1SCLOSURE STATEMENT PURSUANT TO THE BANKRUPTCY CODE

KASOWITZ, BENSON, TORRS

& FRIDMAN LLP
David M. Friedman

Adam L Shiff
Robert M. Novick 130J Avenue of the Amercas
New York, New

York 10019

(2 J 2) 506-1700 .
EXHIBIT

-andP ACHUKJ, STANG, ZIE "
YOUNG & JONES,P.C. Laura Davis Jones 919 North Market Street, Suite J 600
WiJmingtoQ, Delaware J 980 J
(302) 652-4100

CO~COUNSEL TO DEBTORS AND DEBTORS-IN-POSSESSION

2 z: J 'B96

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K

Management .
I. Reorganzed Cor.n Board of

Directors and Executive Offcers _

a Board of Directors composed of the below-listed individuals. Reorganze Coran) wilJhave the oveiaU coiporate stnclure depicted ill the chars attached hereto as Exhbit G.
The following òiographicalinformation is fuished ~ith rest to thë.abovenamèd members of

Reorganizcd Coram will be managed by

the Board ofpirectors and sCor exectives ofReorga.nized Coram:

NAME
Danel D. Crowley

AGE POSITION WI CORAM
52 Chairman of the Board

DIRcrOR SINCE

Donald J. Amaral Wi1Jam J. Casey
L. Peler Smith.

Sandra L Smoley

63 Dir~tor

47 Director 55 Director 50 Director

1999 199~ 1997 1994

2000

Mr. CrowleyjoiDed COrn-as.its .Chainnan, ChefExecutiv.e Offcer.ad
o ';'ol;

Pi:ide¡itasôfNovembi;r 30, 1999. He is also chaIrman OfWinJerland. a privateJyheid affnity
- :merchandise company hi the musc and entertainment industi, and Chairman, Chief Offcer andPresidenl of consulting

Executive Dynamic Healthc:¡e Solutions,-LLC~ a privately held management

and inveStment firm that he established in 1997. Prior to founding DYnamic

Healthcare Solutions, Mr. Crowley served as President of

the Chairman, Chief Executive Offcer and Foundation Health Corporation, a .post that he had served in sinèe 1989,
Mr. Crowley seres as Oi'lirman of-the Board, President, ard Chief

Executive as of November 30, 1999 (as subsequently amended, the "Crowley Agreemènt"). The Crowley Agreement provides, among
Offcer ofCHCpursuant to an employment agreement dated. other

things, that Mr. Crowley.shall I-eceive, among other compensation, a base saar ("Base

Salary") in the .amount ofS650,OOOper anum, and a perfOlTance bonus based upon CHC's EBlTDA reslts for fiscal year 2000 as reflected in the Debtors' audited financial statements, in
the Debtors'EBITDA greater than Sl4 miJJion, and S5 miJJion to Crowley and other members of management asdesignatëd by Crowley ifEBIIDA exceed S35. miJlion.
The Crowley Agreement also provides thaI Mr. Crowley shall the amount of 25% of

amount otS.i.8 millon, payable on the Effective Date of a planreceive a reslrcturingboiius of reorganization which is
. approved by CHC's Board of

in the

Directors. The Crowley Agreement will be asumed by CHC and assigned to Coram under the provisions ofthè Plan.
Mr. Crowley also serves as a consultant

. whichïs a member of the Noiehold~r Group, wiih respect

to Cerberus Parners, LP. ("Cerberus"),

to its inveSlments in vañous health

41

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''''

t:

:9 care companies

other than the Dèbtors. ~. Crowley geñef311yreceives a fee from Cerberus for
serces.

such serices, but receives no.fee from Ceroerus for any

Debtors.

he provides resecting the

Mr. Amaral serVed as Oiairmån of the colIpànys Boaid of Directors from

September 1997 until November 30, 1999. Mr. Amaral has served as a director of the company
Executive Offcer of the company from October 1995 though April 22, 1999 though Novcmber 30,1999, and as Presdent from October 1995 though December 1997. Previously, he was Presdent and Chief Opef3ting Offcer of OrNda Healtlcorp ("OrNda") from Ap.rl i 994. to August 1995, and sered in varous. executive 23,1999 and October Positions wi.th S\lit J-ealthÜd. ("S~it") from October: 1989 to April since October 1995~ Chef

1994, including President and ChefExëcutive Offcer betwe.en O~tobeI 1991 and April J 994. Sumit was
merged into OrNda in April 1994. Mr. Amarl is also a member of

C;ueMatrx Corpration.
Mr. Casey

the Board of

Directors

of .

has served as a director ofèoram since Septembi:r 1997. Since 1983,

Mr. Caseyh~ sered as a consultant in. the.healthcare industiy, speCializing.in hospital managementêval;u¡itioii, hospital planng, manage caFe conlracti~g and tu:iroundservices.
From l 986 to 199~7~ Mr. Casey has also served as Contract AdJ;!niStratnr for

))epartinenIPhysician'Medical Group, Inc. and its affliated medicalWoups, Emergency . which provide
physcian. service to ßon-govemmental facilities. In addltion~ fram 1988101997, Mr. Casey seed:cs Contrct Administrator for NP Medical. Gr-up, lne., -which.provides physcian

10 govenmeni faciJiiies. Mr. Casey also serves as a director ofTriCounti6rBan..
Mr. L. Peter Smith has served as a director was a

has 'servces

November 1993 ai;dJuly 1994, Mr. Smith

)

the Managing Parner of AUCare Health Services,lnc., which was acquired by Medisys in

of Coram since July J994.Between director ofMedisys, Inc. Mr. Smith served as

December 1992. Mr. Smith is also OiiefExecutive Offcer and servesonihè Iloard òfDirectors ofRalin Medical, Inc., a company specializing in cardiac diseae management. Mr. Smith also serves OTl the Board of Directors of Gateway, lnc. and AMSYS, Inc. Mr. Smith previously served ?n the Boård of Directors of SabratekCorporation from Oçtober i 992 though August 23, 1999.
Sabratêk Corpration filed a voluntar bankptcy petition under ChapterI I of Code on December.7, 1999 and that proceeding is

. .
Ex

. Bankptcy Cour in Delaware.
Ms. Smoley was eJected to Coram's Board of

the United States presently pending before the Unitéd States

Directors on February 10,2000. Ms. The SanØraSIloley company, a health care and local govenent consulting firm based in Sacraenio, Californa. From October r993
Smoley is the Chairman and Chef ecutive Offcer of to Januar 1999, she served as the Sècretaiy of to that time; she was Secretar of

January "193 to October ~ 993.

the Californa Health and Welfare Agency, Pror the Califomi;i Stale and Consumer Servce Ägency .&om

45
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2. Arr.angements witb ReorgaDizedCoram's. Executives

Reorganized Cora's succesful implementation. of

.highly dependent Upon the continuing commitment of its key executives !o achieving coiprate objectives. Reorganzed Cora intends to enter Int() agreements with its key executives in order

its busines strtegies ~Il be

)

. to recit (where necesar).

an retain Ihe serces of such.executives and (a) ase the availability o.ftheir skillSfor the benefit ofReorgared C~ra, (b) secure to Reorganze Coram .freedom from competition by such.perns With reaonable and ¡awful limits, and (c) provide
appropriate base con.pensa~on, benefits and fin-anciaJ incentives though bonus, severce and
other employment-related progrs.

The senior executive officers ofCora .and CHC are cllrrentJy receivig a salar
from the Debtors at the foJlowig anualized.

rates:

NAME SALARY (BASE)
DanielD. Crowley $650,000

AGE

POSITION(S) Wirn

. CORA
52
Chairman, .chief

Executive

Offcer, President and

Director
.;

Scott R. Dantz

$200,000

42

Senior Vice.Presdent,

Fimirêe and Chief Accounting Officer
Scott T. Larson
$ J 85,000 .

37

Senior Vice President,
General Counsel
and Secretar

. AJJen J. Marabito

$310,000 $165,000

53

Executive Vice President
Senior Viçe President, Hl.man Resources

Vito Ponzio, k

45

insurance

Certain senior execuiive officers also receive medical, dental, disability and life coverage, car allowances and paid vacations.

In addition to base salaiy, Coram's senior executives, as senior executives of Reorganized Coram, will continue to ear bonuses or, if voluntarly terminated or terminated
. without cause, be provided with severance benefits in accordance with certain of the Debtors' plans ¡hat are currenl/y the subjecl.of an application for approval with the Banptcy Cour.

46

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Specifically,

the Debtors have obtained Banp!cy Cour approval of a Key

Employee Retention Program, which is described above at section N.F3.....Otber Administrative

Events." .
Compensation PrgT") which appliesto approximately thrt-five (35) people. Tht Executive
The Debtors also have a management incentive program ("Executive . .

Compensation Pro~ consists otthee components: base salares, short tetm incentives, and
long term. incentives. The Debtors intend to assue Executive Compensation Progr, except

that the Executive Compenion Progr will be modified to the.extent necesa to be ,
consistent wtth the provisions of the Plan. A copy of the Executive Compensation Progrm, as

modified, wiJ be included in the Plan Supplement.
. Scott R. Daìtzhas sered as the company's Vice Preident ánd Controller from January 1998 thugb December 1999 and as Senior Vice Presdent, Finance and Chef . Accounting OffCer since Januar 2000. Previously, Mr. Danitz was employed by First Data

.-

Corporation from 1989

through 1997 and held varous positions, the most recent of

been VièePresident and Controller, Payment Intrments dIvision.
Scot.i T. Lars-onhas served as the CounselsiIic~ July I 998

which had

company's Senior Vice President and G.eneral . and was elected Secretary in April 1999. Previously, Mr.l.ason served

asUie companY's VicePtesjdeit and Legal COuIsel from March 199610 July 1998 and as

Assistant-GeneraJ -Copnsel trom July 1994 du'ough :FebruarI 996. Between :December 199..1 -ad

July 1994, ML Larsoilseted as COrPoiateCounsel andJater as Assistant:GeneraICOllsel for
T(2)Medicãi,Inc: ('.'T(2) Medical~). Before joining T(2) Medical, Mr. Larson Was employed as anaitomey wiih the AiJanta~b3sed lawfirm óf Alston & Bird.

AlIenJ. Marbiio joined Coram effective November 30,1999 as Executive Vice
President. From 1997 to i 999, Mr. Marabiio was in privale law practice and Senior Vice.

President with Dynamic Heallhcare SOlulions, LLC. From 199) to 1991, he served as the SerioT
Vice Presideni, Secretary and General Counsel of

Foundation Health Corporation.

Viio Ponzio, Jr has served as the compaDy's.Senior Vice President, Human
Resources since September 1998. Previously, Mr. Ponzo sered as the company's Vice President _.
ofHùman Resources from Februar i 996 to Seplember i 998 and as Director of

Resources from February .1994 10 Februar 1996.

Human

F.. Certifcate of Incorporation and By-Laws of the Reorganized Coram

. Pursuant to the Plan, on the Effective Date~the Reorganized Coram wilI file the
Amended and Restated Certificate oflncorporation of Amended By-Laws of Reorganized Coram. See "Implementation of

Reorganized Coram- and will adopt the
the Plan -_ -Corporate

Action." The descripiion set forth below is inlended as a summar only and is qualified in iis

'17

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REPORTEl LORRIE L MARCHANT RPR.CRR. ~ NO. 10513

EXHIBIT: 38 ';~t~~~ 0 # of pes: .

WltJlt~

. . INTI UNTED STATES BANUPTCY COURT
FOR TI DISTRCT OF DELA WAR

. lore
CORA HEALTHCARCORP. and

)
) )
Chapter 11

CORA, INe.,
Debtors.

)
) )

) )

Case Nos. 00-3299 (MW)

though 00-3300(MW)
Jointly Administered

FIRST AMNPED AN RESTATED DISCLOSURE STATEMENT . PURSUANT TO SECTION 1125 OF THE BANUPTCY CODE

. .

KASOwiTZ, BENSON, TORRS

& FRIEPMA LLP .
David M. Friedman

Ada L. Shiff
Robert M. NoviGk
. .

1633Broadway .
New York, New Y nrk 10019 (212) 5Ó6- 1700

- and - .
. PACHUSKI; STANG, ZIEHL, YOUNG.& JONES, P.C.

Laur Davis Jones. .
919 Nort Market Street, Suite 1600 Wilmington, Delawae 19801 (302) 652-4100

CO-COUNSEL TQ DEBTORS AN . DEBTORS-IN-POSSESSION

. . EXHIBIT
BIOI

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:.. piecmea liquidation of the Debtors. See "Votig and Confatio~.of the Plan - Liqui~tion .
Analysis." Accordingly, ih~Plan proposed by the Debtors: .. .

· pennts Cora and its operatig subsidiarès to contiue their business operations;
· eHmimltesand refices substtialy all of (non-pnonty) indebtedness and provides of

the Debtors' existg unur
for the payment of

cah and the issce

New Cora Stock and New Secured Notes to the holders .of such indebtedes; and

· . extgushes all existing equi~ interets of ihe Debtors.

2. Summary of Classes and Treatment
Under the Plan, Claims against and Allowed Interest- in the Debtors are divided into Classes according to their similarty to o1tei:Claisand AllOWed Interests, the paricular
Debtor obligated on the Claims and the Debtor which issued relative legal. and contractul priorities of the

the Allowed Iriterests ard the

Clais and Interests.

In accordance with mandatory provisions of the Banptcy Code, the Plan

provides that holders of certin Claims (Allowed AdInisttive Clais, Al'owed Non-Tax Priority Claims and Allowed Tax Priority Ç1aims) will be entitled to ÙDediate (or, in.the cae of
Allowed Tax Clais, deferred) cash distrbutions. .
. The aggregate aioUIt of Debtors' estiInatesofthe aggregate anOiltSofClai tht . upon resolution of any Clais that the Debtors believe

Clais estimated in each Class isbas upOn the.
the Debtors believe will be asSerted.

will be Disputed Clais. Cert of these

. the Plan.. . . . - -. . . . ..
. . ,.0 . . . below are. based upon the Debtors'. prelimin review of the Debtors' books

Disputed .Claims may be material~ and .the töta amount of all such Clai, incIudingDisputed .

Clåims, may materially exèeed the tota amoUnt of Ailowed Clais asSUedin the development of

The estimated Aggregated AiowltofClaisEsated depicted in the iable .. ... .. .
and ~cordS and. may. ...

.:be revised following the passage of all applícable bar datès and the completon of a detaled

. . analysis .of all Claims fièd in the. Cases. .

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Description and A~ount of
Claims of Interests
· Admstrtive Expense

Treatment.
Unipaied; payment (i) in fuU in Cash.on the later of the Effective Date or the date such Clai becomes aì Allowed

Clai

(Unclassifed)

Clai, or (ii) onsuch other temi to whch the pares agre;
. provided however.

that Admsttive ExPense Clai
business will be paid as

inctned in the ordin coure of

sUch Claims become due and payable in the õrdinar coure
of

business.

· Aggregate Amount of Clai Recovery (Eimated): 100%

Estimated: $3,700,000
Ownership of

Reorganzed Cora: 0%

· Priority Tax Clais
(Unclassified)

option,

Unimpaired; ~t the Debtors' or Reorgand Cora's as applicable, (i) payment in ful, in Cash, on the

later of the Effective. Date and the date such Clai becomes.

an Allowed Claim, (ii) a Tax Note equa to the ful amouit of such holder's Priority Tax Clai, or (iii) on such other
to by the holder of an Allowed Tax Claim and the Debtors or Reorganzed Cora.
terms as mutually agreed

.. .

· Aggregate Amount of Claims Re.coveiy (Estimated): Estimated: $40,000
Owner~hip of

100%.

Reorganzed Cora: 0%

· Class CtIC P (Allowed CHC . .. Priority Non-Tax Claims)

· Priority Non-Tax Clais
against CHC
· Aggregate Amount of

..

Uhimpaired; on the Effective Date,~t the option of the . Debtors, (i) payment iI full in Cash on the later of the Effective Date or the date.such Clai becomes an Allowed . Claim, or (ii) such other treatment to render such Allowed .
CHC Priority Non-Tax .clai unpaied.

Clais Recovery (Estimated):

.Estimated-sli,90h:.. .::: .'...

:. .100%

. . . Ownership of Reorgand Ccir.: 0% .
·

Class CHC i (Allowed CHC
. Unimpaired; on the Effective Date, at the option:

of the Debtors, (i) payment in fuHii Cah on the _later of the . . .. Effective Date or the date such Clai becomes an Allowed .. Secured Claims agmnst CHC .Claim, or (ii) such other treatment to render such Allowed CHCSecured Claim unpai.

Secured Claims)

· Aggregate Amount of Clai .. . Recovery (Estimåted): 100%
Estimated: $1,850,000.

Ownership öfRèorganized CoI': 0%..

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· . Class CHC 2 (Allowed CHC
General Unsecured Clais)

Impaied. If Clas CHC 2 votes to acept majorities reqUied by setion i 126(c) of

the Plan by the

the Banptcy

. Côde, each holder of an Allowed. CHC Genera Unsecurd
· Genera Unsecured Cliis

ågainst CHC

. shaÌl recei.ve its. Prö Rata sha of (i) the CHC Geper Ünsecured Consideration and (Ii) the CHCNoteholder
Consideration, whclÌis a tota cah pool of$2 million. If

to accept the Plan by the requiSite. . majorities, each holder of an Allowed CHC Genera
ClaSs CHC2 fai

Unsecured Clai.wil receive a Pro Rata shar of only the CHC G~nera UIiecùid Consideration.
ClassCHC 2 receives an enhanced distrbutionifit votes in-

favor oftIe Plan. . .
I,

Recovery (Estiated): .
· Aggregate Amount of Claims Estimated: $7,407,000
Ownership of

28% if acceptig Plan 0.8% if rejectig Plan

Reorgand Coram: 0%

Class CHC 3 (Allowed CHC
Notes Claims)

Impaired; if Class tHC 2 votes to accept the PLan no
recovery. If share of the ClaSs CHC2 fails to accept the Plan, pro

rata

Noteholder Consideration.

- Allowed Claims arsing under
the Notes

again CHC
Recovery. (Estmated): 0 % if Class CHC 2

-Aggregate AmountofClais . .

Estimated: $252,620,000

accepts Plan

a ii rata share of a" $1 millon

. cah pooUfClass CHC 2 rejects

Plan

Ownerslup of ReorgaIzed Coi:: 0%
o. .. 0 ~~ . 0 ,. .

Class CHÇ 4(AJIowed CHC
. Equity lntere~) .

Impaired; no disti,ution and all rights andinterst
...canceled.: .

- All equity iIite.rests in CHC
-AggregateVahie of

Recovery.(Estimated):

0%

Interes

Ownership. of ReorgaIzed Cora: 0%

Estimated: $0

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· Class Cora P (Allowed Cora Priority Non-Tax Claims)
.. Priority Non-Tax

Unimpaired; oil the Effective Date, at the option of the Debtors, (i) payment in full in Cah on the later of the
Effective Date or the date such Clai becomes an

Clai, or (ü) such other trtmeit to render such Allowed

Allowed

against Cora
· Aggregate Amount of

Claims

Cora Priority Non-Tax Clai unpaired.

Claims

Estimated $70,000

Recovery (Eated): 100%
Owership of Reorganzed Cora: 0%

Secured Claims)

Class Cora I (Allowed Cora Unipaired; on the Effective Date, at the option of the
Debtors, (i) payment in.full in Cash. on the later of the

· Allo~td .Secured Claims

against Cörà
Estimated: $16,700

becomes an Allowed Claim, or (ii) such other treatment to render such Allowed Cora Secured Claim unpaired.

Effective Date or the datt Such Clai

· Aggregate Amount of Claims Recoyery (Esti~ated): 100%

..

Ownership of

Reorganzed Cora: 0%
Cora Stock,

Class Coram 2 (AII~wed Còra Impaired; each holder-of an Allowed Coram Note Clai
Note Claims) shall receive its Pro Rata share of: (i) the New

· Allowed Claims arsing under

. and (ii) the New Secured Notes.

the Notes against Cora
· Aggregate Amount o(Claims . Recovery (Estimated):

Estimated: $252,620,000

180 +29 = 83% 252
Ownership ofReorgah~d Cori: 100~

Class Coram 3 (i'lIowed .cora.

General Unsecured: Claims)..
· .Ge~erâl Unsec:led ëi~ims against Coram
· Aggrtgate Amount of

Unimpaired; at the option of C9ra or Reorganze Cora,
'(i) payment in full in Cash op.. th.e later of the Effective Date..
'-." -

or the date su~h Clainí becoIies an AlIowedClai, (ii)
Reinstatemeni, or (Hi) such other trtment

.. .

Allowed Cora Gener-al Unsec~d CIai.uIpared.

to render such

Clais Recovery (Esiimated):. 100 %

Estimated: $830,000

Ownership of Reorganized Cora: 0%

9

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and all rights intereSt Equity Interest) canceled.and. . .

Class Cora 4 (Allowed Cora Impaired; no distbution

All equity interest in Cora
· Aggrgate Value oflnterests Recoveiy (Eated): 00./

Estimated: 0
Ownership of Reorganze COra: 0%.

TIE TRATMENT AND CLAIMS AND

DISTRBUTION PROVIDED TO HOLDERS OF ALLOwE

EQUITY INREST PURUAN TO TI PLAN AR INFUL AN

COMPLETE SATISFACTION OF TI ALLOWED CLAlMSAN EQUITY INRESTS, AS THE CASE MAYBE, ON ACCOUNT OF WHCH SUCH TRATMEN IS GIVEN AN SUCH DISTRIBUTIONS AR MAE.

3. Soqrces af Cash to Make Plan. Distributions
Coram will contrbute c.ash in the amount of $2 .milion to fud the Unsecured II be distrbuted to the holders of Allowed Claims in Classes
the
by the Plan

Claims Reserve; \\hich monies wi CHC 2 aId (if

Class CHC; 2 fails to accept the Plan) CHC 3 puruat to the provisions of

Plan. The cash required to make all other payments and distrbutionS contemplated

will be generated from the operations of the Debtors and, if necessa, borrowig under the Debtors' Exit Fínancing Facilty. Based on curent projections, the Debtors.believe that they Will

have suffcient ~h to continue to ope~te their busi~esses and make thè necesSa cah. distrbutions under the Plan. See section XVII "Projections," below. If, however, the Dtbtors .
. become engaged in protracted litigation or the Plàn is not confrmed as

29,2000, there can be no assurce that the Debtors will have sufcientanticipated by December. cah to make
distributions thereunder without availing themselves of other (noIi-'OPerational) soures of fuds,
and there

is no assurce that ~uch .fuds wil be available on acceptable terms ahd conditions.

See "Risk Factors -~ Capital Requirements."

4: Summary of Reörg~nized Co~pany ..

.. Reorganzed Cora wil lx: privately held by the Noteholder Group. Publicly.held. CHC wil cease to have aiy direct or indirect business operatións .and Will be dissolved in.
accordance

.. . ..
10

with the provisioIi of the Plan. As a privately-held company, Reòrganiid Coni
having elimnated.

will be able to mainta compliance with the provisions of Stak II as a resut of

(i)"physiCiim who make Medicar ard Medicad referrs to Cora.or its :subsidiiuHoPeratirigcò~panes or (ii) family ~~mbersof such physiCian. So owned,.. .
Reorganzed Cora will also be substàtially.likely to remain in complianCe with Stak

the risk of ownership by

II for the.

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E. Management.
1. Reorganized Coram Board. of

Directors and Executive OffcerS
Dirctors composed of

Reorgan CoI' wil be maned by a Board of . below-listed individua plus 51th other individuas as

the

may be ageeto bytÌe Debtors and the Noteholder Group whose naes wi be included in the Plan Supplement. Reorgan Cora .
will have the overall corporate stctue depicted in the char atched hereto as

Exhbit H.

The followig named curent members oithe Board of

biogrphical

infonnation is fushed with rect to the aboveDirectors ofCHC and the senior executives of

Debtors:

the

as of

Mr. Cr~wleyjoiIed CHC as its Chaifmai Chief Executive Offcer and President November 30, 1999. He is also Chairman of Winterland, a privately)ield affInity

merchandise company in the music and entertruent industi, and Chaan, Chief

Offcer and President ofPynamic.Heaihcare Solutions, LLC,.a privately held management
Solutions, Mr.

Executive

consultíng and investment fini thi he established in 1997. Prior to founding Dync Heathca
Crowley serVed as the Chaian, cwer Executive. Offcer and .President of . . Foundation Heath Còrporation, a post that he had .served in since 1989..

. .

Mr. Crowley serves

.. Offcer ofCHC PurSlt to an einploymentagreement dated ~ ofNoveinber30, 1999.(as. '..
.~siib~eqûentiy arended,~tle \~Çrowley AgreehientOl)~ The Crowley Agreement provides, aiong , ..

as Chairimi.ii of-the Board, President, and CIiefExecutive

...

q;6ther -lngs,th"Mr.Ç¡'owley shaUreceive, aiIlg other compeDstioD; a baSe saJii ("Base ... .. SaIarOl)jn.the amount of$650,OOOper anum,anci'a perfoi:ance. bomisbas.ec upon CHC's .
... EBImA resiits for.fiSca.yea 2000.a. reflected in the arountof 25%' of ... and other members of

the DebtorS', audited fianCiaisttements,.in.

Crowley management as.designäÚ~d by Crowley ifEBITDA exceeds $35 millon..,

the Debtors' EBITDA greater than .$ 1 4 miiiion, aidS5 iiìlion to

. The Crowley A~eemeritalso providès that,Mr. Crowley sh3I receive a resfrctUg bOnus ii the.

.... . . ,:aiount of $ L8 milion, payable on the Effective Date of a plaI offeorgantion wwth is:. ... .. .,. ..'approved by CHC's Board ofDiretoI:.The Crowley Agrement Win beåS~ed by tHC aid. . the provisions of the Plan. . . . . .. . . (isiglU:d to Côra under

47

BI07

Case 1:04-cv-01565-SLR

Document 138-4

Filed 05/04/2007

Page 13 of 43

Mr.

Crowley a:sa selVes as a coIitåt to CerberU Parers, L.P. ("Cerberu").

. which is a member of the Noteholder Group~ with ret to its investents in varous heath . .compimes .other th the pebtors. Mr. Crowley generaly

cae

reives a fee from Cerbe for such servces, but reCeives no fee from Cerberu for any servces he provides re~g the Debtors.
Mr. Anar served as Cbanof CHC's Board of

Dirtors frni Septembe

1997 until November 30, 1999. Mr. Amar ha sered as a dirtor of tne company smce
October 1995, Chief Executive "Offcer ofCHC from October 1995 thugh Appi 23. 1999 and . . October 22, i 999 thugh November 30, 1999, and as President from ()ctobtr 1995 thugh December i 997. Previously, he wa. President and Chief Operatig Offcer of OrNda HeathcoIp ("OrNda") from Apn119.94 to Augut 1995, and seived in vanous executive positions with

SuIt Heath Ltd. ("sumit"i from October 1989 to Apnl 1994. includig President and Chief

Executive Offcer between October 199 I and Apnl 1994. Sumt wa merged into OrNda in
. Apnl 1994. Mr. Amar is also a member of the Board of Directors of Care

Matr Corpration.

Mr. Casey has seived as a director ofCI:C since September 1997. Since 1983, Mr.

Casey has served as a conSultat inthehealthcae inqus, specializing in hospita management evaluation, hospita planng, managed care contrcting and tuaround servces. From 1986 to i 997, Mr. Casey has also seived as Contrct Administrtor for Emergency Deparent
Physicians' Medical Group, Inc. and its affliated medical groups, which provide physician seivices

to non-governenta facilties. In addition, from i 988 to i 997, Mr. Casey has seived as Contrct
Administrator for Np Medical Group, Inc., which provides physician services to governent facilties. Mr. Casey also selVes as a director of TnCounties Ban.
. Mr. L. Peter Smith has seived as a director of CHC since July 1994. Between

November 1993 and July 1994, Mr. Smith \vasa director ofMedi~s. Inc. Mr..Smith seived as the Managing Parer of AlICare Heath Seivices,Inc., whÎch wa .acquid by Medsys il .. December 19~2. Mr. Smith is also CruefExecutive Offcer aÌd serves on the Board of Directors
.. of Ralin Medical, Ine;, a company spei~izing in êadiac disease Ifanagement. Mr. Smith also.
selVes on the Board of Dïrtors of Gateway, Inc. and AMSYS. Inc. Mr. Smith previously seived .. on the Board of Directors of SabIëtek Corpration from October i 992 though Augut 23. i 999~ .. ...SabiatekCörpratIon ñle9a volunta baIptcypetition under ChapterIi of

the Un,ted States .; .. Code on. necember 17, .i 999 and tlat procediIigis presently peiidmg before the United. States

. . , .. ' ...". ..:Baiptcy CoUr. ÎnDelav.. .. .. ... .. .....
.. .. .. .Ms. SinoleyWa eleèted:io.CH6sBoàrd'ofDirtors on.Feb~ 10,-2000. Ms~.
.. .Smoleyis theChairran àId Chief

. . .

. ..
. . ...: ~.

Executive Qff.cer ot-The SanCÍ Smoley CompaIy. a heath :

care and 10cagovemmditconslutIg fiÖl1baSed inSàcrnento, Californa. FroInOctober i993. ; to Janua i 999, she. seived as the Sêcreta of the. Caifomia Heathand Welfar Agency. Pror. .
.. ... to that time, she wa Secreta of the Californa State

.. Jaruai1993 to October 1993. .... . .. . . .

and CÖI1er Semces Agency friI

48

BI08

Case 1:04-cv-01565-SLR
(

J
iNtHE

\ EXHIBIT:

i ~- .
o
STATES BANUPTCY

Document 138-4

Filed 05/04/2007

Page 14 of 43

REPORTE~ LORE L MARCHANT RPR. eRR. CSR NO. 10m

Witness: . ~ 1.5 . :

Date:' # of pages: I i ~

c,.~ --.(;0 ..:. õ.~ -.. ..~ :""7 c:..
=: :;~

UNITED

COURT ;t.::. 1'.:.
(..l .N

c_.
. '.ti.

FOR THE DISTRICT OFj)ELA W AR
-- -. . -i
Ii re:

~~

.-l.:

.= '.

. C;

C;

)

CORA HEALTHCAR CORP,
and

)
) )

)
Chapter 11

. CURA INC.,
.. Debtors.
.

)
)

Case No.OO,"3299(MFW)

(Jøintly Admiistered)

)
)

NOTICE ()F wtTIfDIl ",AL Oi! PEllTORS' APPLICATIÔN . .l'nR ORlER AUTRoïutING EMPLOYMNT AND R-ETEN'fIONOF DYNAlnCHEALTHCAR SOLUTIONs
1. .On Septemper7, 2000,.the above-cáptionçd debtors

possession (collectively, th.e "Debtors")filed the AppliCàt1onfor Order Authonzing EmploYment
and Retention of

.. .
2. The .office of the United 4. Asa reSult of-the settleient

and debtors-in-

Dynamic Healthcare Solutions (the "Application'')IDocket No. 165).
States Trutee objected to the Application (the

"Objection") (Docket No. 194).
. 3: The Debtors and the Trustee .have engaged in extensive negotiations in

order to resolve the issues rased by the App~cation and tht Objection.
reched with

the Trutee; the Dentors btlieve

. that the Application should be withdrWn.
5. However, and

as apar ofsllchobjeetin and to faciltate the contiued

'provi$ionôq~ey seIV~es byc~rtn pernnel to the Debtors, six former Dynamic employees set

15S70.I\D _ DE: 1269S.1

:.1/1 S/ l1: 10 pM

BI09

3f~~

Case 1:04-cv-01565-SLR

Document 138-4

Filed 05/04/2007

Page 15 of 43

t
\

\
Dan Smithon, Peter And-rews,DarlenaBay and

. forth in the Application: Ron

Mills, Kurt Davis,

Paul Weber (collectiveiy, the "Employees"), wiU be employed

by the Debtors as '4at will"

employees effective as of

Augut 1,2000.

6. The.Employees have tendered their resignation to Dynamic and Dynamic

will not profit from the Employees rendition of services to Dyramc.
. 7. . hiasmuch as the Debtors' employment of these Emp~oyees is as "at will"

employees, the Debtors believe

their employment to be

ordinar

course tractions, and

. therefore, do not believe that they should seek approval therefor.

.15S70-1\D _DE: 12695. I
. 11/1.5 II: 1 0 PM

BllO

2

Case 1:04-cv-01565-SLR
.\

Document 138-4

Filed 05/04/2007
)

Page 16 of 43

.\
.i

8.

The Debtors wil be before the Cour on Noverber 28, 2000, and can .

address any matters with respect to the foregoing at suchtIme.

Dåted: November liç, 2000

KASOWIZ, BENSON, TORRS & FRIDMA LLP
DaVid M. Friedman

Adam L. Sllff
Athena F. Foley
I301Avenue of the Americas New York, New York 10019 Telephone: (212) 506-1700

- and TANG

ZIEHL YOUNG & JONES P.C.

..... ,:..~..~....... J.
aura Dav' ones (No. 2"436)

Rachel S. Lowy (BarNo. 3753)
Chrstopher J. LhulIer (Bar No. 3850)
919

North Maret Street, 16th Ploor

P.O. Box 8705
Wilmington, Delaware 19-899~8705(Courier 19801)

Telephone: (302) 652-4100 Facsimile: (302) 652-4400

Attorneys For Debtors And Debtors hi Possession

.J 5S70.1\D -'DE:12695. I
ÙIJ5I i 1:10 PM

BIll

3

Case 1:04-cv-01565-SLR

Document 138-4

Filed 05/04/2007

Page 17 of 43

IN THE UNITED

STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE
) ) )
) ) )

In re

CORAM HEALTHCAR CORP. and
CORAM, INC.
Debtors.

Chapter 11

Case Nos. 00-3299 through 00-3300 (MFW)

)
)

(Jointly Administered)

AFFIDA VlT OF SERVICE

STATE

OF

DELAWAR ")
Patricia E. Cuniff, being duly sworn according to law, deposes and

) SS: COUNTY OF NEW CASTLE )
says that

she is

employed

by the law firm ofPachulski,:Stag,Ziehl, Young & Jones P.C. and that
-

".,.. on the 9th day. of

November, 2000.she,caused a copy. of the following documents tø ,be

. served upon the individuals on the attched service list in the manner indicated.
1. . Notice otWithdrawal ofDebtòrs' Applícation for Order

Authorizing Employment and Retention of Dynamic Healthcare Solutions.
Dated: November 16, 2000

.. . . l -t t~ . nu-(L. . li/x.iI
Patricia E. Cunff . . . J.

me ths 16th day 1:z=- 2000
4lota Public. . .

Sworn to and subscribed befnre

~-~~
B112

My Commission Expires: 7// /" /.

15570-I\D_DE:II041_30
. I.1WOO i I :34 AM

:çor-a Healthcare Corp. 2002 SerVice List
..Case No.

- ..

Case 1:04-cv-01565-SLR

Document 138-4

Filed 05/04/2007

Page 18 of 43

00-3299
.

Hand Delivery .
(Counsel to Pacifc Insurance Comp)

vember. 16, 2000 uoc.. -# 8018

Carl N. Kwi, II, Esq.
Murhy, Spadaro & Landon
.824 Market

08 -Hand Delivery
. 03': Federal Express

56 - First Class Mail
Hand Deliver

Street, Suite 700 P:O. Box 8989 Wilmington, DE i 9899

(Counsel to the Debtors) Pachulski Stag Ziehl Young & Jones Laura Davis Jones, Esquire Rachel S. Lowy, Esq. Chrstopher L. Lhulier, Esq. 919 Nort Market Street, 16th Floor.
P.O. Box

.. Hand Delivery
.

(Counsel to Brooklyn Respiratory Homé Care) Kevin J. Mangan, Esq. Walsh, Monzck and Monaco, P...
1201

Orange Street, Suite 400

Wilmington, DE 19801-

8705
Hand Delivery

.Wilmington, DE 19899-8705
Haiid Delivery

)
Ellen W. Slights, Esq.
Assistat United States Attorney

. (Copy Service) . Parcels,lnc. .. Vito L DiMaio 16th & King Streets
'Wilmington; DE' 19801

Chase Manatt Centre
1201 N. Market Street, Suite 1100 P.O. Box 2046
.'WilmingtontDE 19899-2G46

idDelivery .
(t.;oultsel for . -Deborah E.. Mark D. Collns,

Federal Express
(Debtor)
Esq. .

Committee)
Spivack, Esq.

.Richards, Layton & Finger, P.A,
. . One Rodney Square

President, Finance and Chief Accounting- Officer Coram Healthcare 1125 Seventeenth Street, Suite 2100
Scott R Danitz, Senior Vice

. p.O. Box 551 Wilmington, DE 19899

Denver,.CO 80202

f' eder.aIExpress

.(DIP Lender)

. Caol Morrson, Esq. Schulte Roth & Zabel, LLP 900 .Thd Avenue New York,. NY 10022
. Federal Express
(Counselfor Commitee of

Unsecured Creditors)

lIa1d Delivery

(Counsel to Cnram ResoLlrces Network, Inc.,
. . Coram Independent Practice Assocwion,lnc.J.

Chaim J. Fortgang, Esq. Wachtell, Lipton, Rosen & Katz
5 1 West 52nd Street

Richard H. Morse, Esq. Edwin J. Haron, ESq. .T'I\lon L. Morton, Esq.
.Line K. Morgan Esq.

New York, NY 10019.:6150

P.O. Box 391 BI13
Wilmingon, DE 1-9899-0391

Young .conaway Stagat & Taylor LLP -1 i th Floor Rodney Sqtle Nort

Firs.-' Clasj" Mail

. (US. Trustee)
ia.Giairiis, Esq.
\..nce of .

..

Case 1:04-cv-01565-SLR

Document 138-4
. First

Filed 05/04/2007

Page 19 of 43

the U.S. Trustee

601 Walnut Street
. curs CeIiter, Suite 950 West Philadelphia:' P A 19106

Class Mail (Counsel to Harris County, Houston lSD, City of Houston) John P. Dilman, Esq. Linebarger Heard Goggan Blair Graham Pena & Sampson, LLP P.O. Box 3064 Houston~ TX 77253-3064

.. First ClassMail
(Representing U.S. Trustee) Ð-ani~l Astin; Esq,
Offce oftheU,S.Trustee

First Class Mail

).

601 Walnut Street Curi~ Center, Suite 950 West Philadelphia, P A 19106

Securities & Exchange Commission 15th & Pennylvana Avenue, N.W. Washington, D.C. 20020

First Class Mail

Pirst Class Mail (Special Counsel) Eugene.Tilman, Esq.
. Reed.Smith Shaw & McClay, LLP 1301 K Street, N.W.

)
DistrICt Director IRS

409 Silverside Road Wilmington, DE 19809

Suite 1100 - Eat Tower
Washington, D.C.. 20005-331 7

First Class Mail
~)

First Class Mail
ùavid M. Friedman, Esq.

Atlanta

Securties & Exchange Commission Regional Offce Reorganization Brach of
3475

Athena Foley, Esq. Adam L Shiff, Esq.
Kaowitz, Benson, TOlTes & Friedman; LLP

Lenox Road, N.E., Suite i 00

Atlanta GA 30326-1232

. i 30 1 A venue of the Americas

First Class Mail

New York, NY 100 i 9-6022

)
Secretary .of Treasury

Fitst Class Mail

P:O. Box 7040
Dover,OE 19903

)
.Thomas M. Antone; iv, Esuire
Mintz Levin, Cohn, Ferrs, Glovsky & Popeo, P.C.

. 1704 Hunting Ridge Road

Raeigh, NC 27615
Firs.t Class Mail

) .
First Class Mail
P.O. I30x 7040
Firt Class Mail

Secreta of State Division of Corporations
Franchise T;, Section

)
J()hn T. Morrer, Esquire Mintz Levin, Cohn Ferrs, Glovsky & Popo, P.C. One Financial Center Boston, MA 021 i i

Dover, DE i 9903

(CQUt1-l!l to Mark w. Pasmantier,M.D.,

B114

Morton COleman, M.D., Thomas W. Nash, M.D. and Barry J. Hartman,.M.D.) Att:Frederick A. Nicoll, Esq. Ea 80 Route 4 Sutie 220
Panus, ~J 07652

Case 1:04-cv-01565-SLR

Document 138-4

Filed 05/04/2007

Page 20 of 43

.. First Class Mail /'-'''l1iselto Invacare Corporation and
Jurban Ostmiiy Supply c.o.;

~. l ..

First Class Mail (pro Se) Chrstopher Beard, Esq.
Beard & Beard
4601 Nort Park

.Couliselto B. Braun Medical, Inc.)
Fracis J. Lawall, Esq.

Avenue

Pepper. Hamilton LLP 3000 Two Logan Squae Eighteenth & Arch Streets

. Philadelphia, PA 19103-2799

).

Chevy Chase, MD 208 i 5

First Class Mail
Lon Obetnauf, Esq. Bankruptcy Administration
IOS Capital, Inc.
1738 Bass Road

First Class Mail
(Counsel to Invacare Corporation and . Suburban Ostomy Supply Co.).

Craig W. Rçlman, Esq.
Craig W. Reiman Co., LP A

P.O. Box 13708 Macon, GA 31208-3708

23875 Commerce Park Road
Suite 105

.Beachwood,OH 441"22

First Class Mail (Counsel to Trammell Crow Company)
Sarah A. Hall, Esq, Mock, Schwabe, Waldo, Elder, Reeves & Bryant
Foureenth Floor, #2 Leadership Square

Fir.st Class Mail (Coilnselto B. Braun Medical, Inc,) Cathy L Codrea, Esq.
Assistat General Counsel

2i- North Robinsòn

B: Braun Medical~ Inc.
r . Twelft Avenue. .

.~ ..ilehem, PA18018

First -Class Mail (Counsel to Aetna US Healthcare, Inc.) Kevin S. Anderson, Esq. Enc p, Wilenzik, Esq. EHiottReihner Siedzikowski & Egan; P.C. Uiuon Meeting Corprate Center V
925 Harest Drive

. .. .

OklahdmaCiiy, OK 73102

First Class Mail
(Counsel to Stieco Life Insurance Company) Mark E. Felger, Esq. Cozen and O'Connor

Chase Manattan Centre
1201 N. Market Street~Suite 1400 Wilmington, DE 19801

Blue Bell, PA 1942i

First Class Mail (pro Se)
JAF Box 3127

First Class Mail (Counsel to Home Health Corporation of America, Inc.) Robert J. Lenahan Esq.
Adelman Lavine Gold and Levin
1900 Two Penn Center Plaz

Mr. Bil ~gelowitz Daiy Inights

PhiladerpÌua, P A 19102-1799

New York, NY 10116

FirsClass Mail
(Pro Se) .

First Class Mail (Counsel to pcn Brandt, Ltd.)
Clyde A. .Pine, Jr., Esq.

Mounce; Green, Myers, Safi & Galatz

Peter A. Chapman 24 Perdicans Place
Me.

P.O. Drawer 1977 .
EIPaso, TX 79950-1977

ton, Nr-.0861&

BUS

Case 1:04-cv-01565-SLR

Document 138-4

Filed 05/04/2007

Page 21 of 43

\
Fiit C/als Mail

/Uro Se)

:garet A. Holland . Deputy Attorney General the Attorney General Offce of
. . R. J. Hughes Justice Complex

. First Class Mail (Counsel to Resource Realtj oINorthern NewJersey, Inc.)
Merrll M. O'Brien, Esq.

\
~

P.O. Box 106 Trenton, NJ 08625

Dollnger & Dollnger, P.A. Mack-Cali Centre II One Mack Centre Drive
ParaIus, NJ 07652-3906

First Class Mail .(Counsel tò ManciniProperties, Inc.)
Peter A. Kline, Esq.
Joan R. Kester, Esq.

First Class Mail
(Counsel to Spieker Propertie, LP.)

HowardJ. Weg,Esq.
David B. Shemano, Esq. Peitzan, Glassman & WegLLP
i 900 Avenue of the Stars, Suite

Miler, Morton, Cailat & Nevis, LLP 50 W. Sar Fernando Street, #1300 . San Jose, CA 95113

650 .

Los Angeles, CA 900.67
First

.

First Class Mail to Richtird.M. Smith) (Counsel
Joseph A. Eisenberg P.c.

Class Mail

(Counsel to Highwoods Realty Limited Partnership)

M. JosephAllnian, Esq.
AlImai .SpryLeggett & Crumpler, P.A.

Jeffer, MaIigels, Butler & Manaro, LLP
2121 A venue of the Stars, 10th Floor

. Los Angeles, CA 90067
r-..(¡t Class Mail
, unsel.o 45 South Service Road Associates, LLC)

380 KnollwoodStreet,- Suite 700 P.O. Drawer.5129 ,.. Winstoii-Sàlbn, NC'27rIJ-5129

First Class M4il
(Counsel If! "Empire Blue Cross Blue Shield)

Leslie H.. Scharaf, Esq. Certilman, Balin, Adler & Hyman, LLP

90 Merrck Avenue
.EastMeadow, NY I 1554

Michael B. Guss, Esq. Morrson Cohen Singer & Weinstein, LLp 750 Lexington A venue New York, NY i 0022

First Class Mail
. (Coiinsel-to North Western Mutual Life Insurance .Çompaiiy) Glen Dresser, Esq.

First Class Mail (Counsel to Rny McCaslin)
Michael A. Becker, Esq.

Law Offces of Glen Dresser
12650. Riv~rside Drive, Suite 100

Helfey Simon & Jones.P.c.
120 S. Celitr, Suite 1500

. N. Hollywood, CA 9 1607

St. Louis, MO 63 i 05

First .cúis Mail (Pro $e) .
Blue .Cross Blue Shield .of Michigan
.Att~ Latonya McGrier

First Class Mail
(The Trnvelers Property CdSualty Company)

The Travelers Indemnty Company
Commercial Lines

Offce of the General Counsel 600 Lafay~tte Eat, MB 1925 Detroit, MI 48226

Att: Cathy A. Davis, Litigation Management &

Special Collectons .
i Tower Squae - 9GS
Harord, CT 06183-4044

B116

Case 1:04-cv-01565-SLR

Document 138-4

Filed 05/04/2007

Page 22 of 43

\
,Fir;! Class Mail l"-'uiisel to Locust Court Associates~ L.P.)
;r A. LeSser, Esquire Sirliil Gallogly & Lesser, P.C.
1529 Walnut Street,

\

. . First Class Mail (Counsel tv Summit Health Care,lnc.) Steven 1. Gutter, Esq.
Kahn &. Gutter
Paine Webber Plai - PH4

.t

Suite 600

Philadelphi.a, .p A i 9 i 02

First ÇllUs Mail
(CounseL- to Advanced Healthcare)

821 i W. Broward Blvd. Plantation, FL 33324

.Stephen J. Dzuranin, Esq.
.Wix; Wenger & Weidner

508 North Second Street P.O. Box 845
Harsburg, P A 17108-0845

. First Class Mail (Pro Se)
Att: Vladimir JeIisavcic

Longacre Management, LLC
1700 Broadway, Suite 1403
New

York, NY 10019

First Class Mail

)
JeffeyD. Chansler, Esq.

Empire Blue Cross & Blue Shield i World Trade Center, 28th Floor New York, NY 10048':0682

First Class Mail (Pro Se) Attn: Jim Flood, CFO
The BroadInoor Hotel

Firs./Class Mail
(proposed Counsel to Equity Committee)
r' "aid.IF. Levy, Esq.

P.O. Box 1439 Colorado Springs, CO 80901
FirslClass Milil

'1 Jdore J. Low, Esq.

.Benjamin D. Schwartz, Esq. Brandy A. Sargent, Esq. Altheimer & Gray i 0 South Wacker Drive, Suite 4000

(Counsel to The Broadmoor Hotel~ Inc.) Steven M. Rudner, Esq. Law Offices of Steven M. Rudner
P.O. Box 12121

Dallas, TX 75225

Chicago,IL60606
Firs/Class Mail
(Counsel to Cirquit.com.) Steven C. Delinko, Esq. Dollnger & Dollnger, P .A. Mack-Cali Centre II One Mack Centre Drive Paramus, NJ 07652-3906

First Class Mail
(Counselto Lancaster County School District 0001,
ala Lincoln Public Schools)

John M. Guthery, Esq.
Perr, Guthery, Haase & Gessford, P.c., L.L.O.

233 Sout 13th Street, Suite Í400
Line.om, NE . 68508
First Class Miiil

First Class Mail (Pro Se)
Alice Nystel Page, Esq.
Sun Healthcae Group, Inc. . lO i Sun Avenue NE

(Couiiel to BrowardCounty Revenue Collection
DivisionJ.

Lace D. Lyons, Assistat County Attorney Broward County Revenue Collection Division. Litigation Section

Governent Center Anex
115 S. Andrews Avenue Fort Lauderdale, FL 33301

Albuquerque, NM 87109

B117

Case 1:04-cv-01565-SLR

Document 138-4

Filed 05/04/2007

Page 23 of 43

: Fifst elMs Mai! - (Counsel tn Pharmerica, Inc.)
- ."l W. Forsley;Esq.

First Class Mall ,

(Counsel to HCA - TheWealthcare Company) John Tishler, Esq.
Waller Lansden Dortch & Davis 511 Union Street, Suite 2100
P.O. Box i 98966

,. .

\

~ .iIlson Henrichs & McHugh LLP
290 S.BeverIy Drive, Penthouse

Beverly Hils, CA 90212

Nashvile, TN 37219-8966

First Class Mail

)
John Cogan Offce of the General Counsel, DHHS

The Public Ledger Building :I~OSòuth Independence Mall West, Suite 418
philadelphia, P(( 1 91 06

First Class Mail

)

WendyS. Tien

.United States Deparent of Justice

Civil Division .
P.O. .Box 875

Ben Fralin Station. Wåshington, D.C. 20044-0875

. First.

Class Mail . unsel to James F.Spriggs)

.uebor3h. Sterling-Scott

UA WChrsler Legal Services Plan 10820 Sunset Offce Drive
. SlJitel 41

St. Louis,MO 63127
. First Class Mail
..(Counsel to Th.e University o/Texas Ssytemon behalf
of The University of Texas M.D. Anderson

Cancer

Center) .
Traci L. Cotton, Esq.

Texas System Offce of General Cound 201 West Seventh Street Ausin, TX. 7870 i
The University of

. First Class Mail to Open Terrace Associa.tes, LLC) (Counsel Mar R. Pigorsh, Esq. . Day & Sawdey, P .C. 825 P.achment.Dnve, SE
r-~nd Rapids,.MI 49546

B1l8

Case 1:04-cv-01565-SLR
1

1 Document 138-4

Filed 05/04/2007

Page 24 of 43

2 UNITED STATES BANKRUPTCY COURT DISTRlCT OF DELA WAR
3

4 ------------------------------------------)(
In Re: Jointly Administered

5 CORA HEALTHCAR CORP. Case Nos.
and CORA, INC., 00-3299 (MW) and

6 00-3300 (MFW)
------------------------------------------ )(

7 November 28, 2000
9:47 a.m.

8

9

10 Deposition of STEPHEN A. FEINBERG,
11 taken in the above-entitled matter before
12 Michele Anivino, Notar Public of

the State of

13 N ew York, taken at the offices of Cerberus

14 Capital Management, L.P., 450 Park Avenue, New

15 York, New York, on Tuesday, November 28, 2000,
16 commencing at 9:47 a.m.
17
18

19

20
21

22 DAVID FELDMAN & ASSOCIATES

23 245 Park Avenue
24 New York, New York 10167
25 . (212) 792-5623 Fax: (212) 792-5624

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1 STEPHEN A. FEINBERG
2 A. Right, my signature.

3 Q. Do you -- and your only title at
4 Coram at the time you signed ths agreement was
5 chairman of the compensation committee; is that

6 right?

7 A. I believe so.
8 Q.. You were not an offcer of the

9 company at that time?

10
11

A.
Q.

I don't recall that.

Can you think of any other document

12 that you ever signed on behalf of Coram
13 Healthcare Corporation, other than Dan

14 Crowley's amendment?
15

A.
Q.

I don't recalL.

16 17
18

You don't recall any others?
I don't recall.

A.
Q.

Do you think it's possible there

19 are some others? 20 A. I don't remember.

21 Q. Let me just -- we'll break in a
22 minute.

23 MR. MILLER: You have a half hour.

24 MR. LEVY: I'd like to talk before
25 he goes.
B120

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1 STEPHEN A. FEINBERG
2 the performance of the company and what Dan
3

could accomplish and all the liabilities, that

4 the assets were substantially less than the
5

liabilties.
Q.

6

When was the Aetna lawsuit
c"

7 settled?
8

A.
Q.

In 2000.

9
10
11

What month?

A.
Q.

I believe sometime in the summer.

How about April, does that sound

12 about right?
13

A.

I don't remember when the lawsuit

14 was settled.

15 Q. In any event, after it was settled,
16 after that it was clear to you that the .

17 liabilities exceeded the assets, correct?

18 A. In -- after the Aetna lawsuit was
19 settled, it was again clear to me that the

20 liabilities were higher than the assets, yes.
21 Q. And

you continued to be a director

22 after the lawsuit was settled, right up until

23 July 24th, I think, right?

24 A. Yeah.
25 MR. LEVY: Do you want to take a
Bl21

Case 1:04-cv-01565-SLR
1

117 Document 138-4

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Page 27 of 43

STEPHEN A. FEINBERG

2 didn't pan out in 2000.
3

Q.

Y ouwere disappointed with the CPS

4 sale?
5

A.
Q.

Yeah, we were.

6

By the way, were you very

7 disappointed
8

or -- and surprised?
A.

9

No. I mean, I was -- from the

10 original projections of Alex Brown, we were
11

disappointed. But by the time the deal was

12 done, we realized that was the best transaction
13

we could do. We chopped the heck out of it.
Q.

14

Do you know what kind of bonus

15 reward Crowley got when CPS was sold? 16 17
18

A.
Q.

I don't recalL.

It was a big one, wasn't it? Do

you recall that?
A.

19

I don't -- I don't remember what it

20 was. Now, remember that Dan basically served
21

as investment baner, in effect, and helped get

22 that deal done: Alex Brown really wasn't
23 getting it done. They had fallen down. And

24 they were the ones tellng us they would have
25 these huge values for it. The market wasn't
B122

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1 STEPHEN A. FEINBERG
2 other value plays has been an absolutely

3 horrble area to invest in in the past few
4 years, whether you are talking about nursing

5 homes, you know, home care, you name it,

6 hospitals. So it's been a horrible IPO market
7 for heaIthcare, and a bad IPO market in general

8 and bad for healthcare.
9 Q. Did you consider, in the time

10 period beginning after Crowley came aboard in

11 November of'99, did you consider hiring an
12 investment banker to explore methods of

13 increasing shareholder value?

14 A. When is this now? I'm sorr.
15 Q. Beginnng of

November, October or

16 November of '99.
17 A. Prior to Dan coming on board, Don

18 Ameral as chairman, was a pretty fervent
19 spokesman for the equity. Don pursued all sort
20 of things. He pursued a deal with American

21 Home Patient, he pursued a deal with Aprea

22 (Ph).

23 He pursued all sort of actions,
24 possibilties, sales. He thought of all sort

25 of things.
B123

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,

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41-~-OI
1

1
2 3

UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE

4 5 6 7
8 9

In re: )
- ----- -- -- --- - -- - - -- --- -- --)

)

CORA HEALTHCARE CORP. )Case No. .3299 (MFW)

and CORA, INC. )through 3300 (MFW)

10 11
12 13

December 7, 2000

14 15

10: 12 a.m..
Deposition of DANIEL CROWLEY, held at

16 17
18

the offices of Kasowitz, Benson, Torres & Friedman LLP, 1633 Broadway, New York, New
York, pursuant to notice, before Cary N.

19

20 21
22
23

Bigelow, RPR, å Notary Public of the State
of New York.

24

r-'\ ::,.;

25

SPHERION DEPOSITION SERVICES (2i2) 490-3430
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Case 1:04-cv-01565-SLR

Document 138-4

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Page 30 of 43

Crowley
Healthcore. We worked on HRH, looked at Continue

42

¡

,/

Care, looked at Vencor, Sun Heal th Group. We gave

advice on Medicare trends on HCVA, we provided
systems support on analyses, we did some actuarial
work on various proj ects, we worked on PHP.

There may have been others.

I don't

recall.

Q. In this period, again, prior to your
introduction to Coram, did you charge for these

services? A. Yes.
Q. Was there a formal written agreement
with respect -- well~ was there any written
agreement with respect to these services?

. A. In the beginning, it was just a

proj ect - to-proj ect basis, time and charges.

Q. So in the beginning, you would identify
that as the beginning of 1999, roughly?

A. Roughly, yes.
Q. How did you charge Cerberus on this
project-to-project basis?

A. Generally, I charge $10,000 a day for
myself, plus expenses, I generally don' t do part
days, and there are fees I charge for the other

SPHERION DEPOSITION SERVICES (212) 490-3430
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Case 1:04-cv-01565-SLR

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Page 31 of 43

43
1 2
3

Crowley
staff based on their experience and the

value-added, plus expenses, and we decide what work
we wish to take or not.

4 5 6

Q. Again confining yourself to the period
before Coram, did you ever become the CEO of a
company in which Cerberus had an interest?

7
8 9

A.
Q.

No, no, I didn't.

How was this rate of $10,000 per day

10 11
12
13 14

set?
A.
Q.
That's what I want.

And that's what Cerberus was willing to

pay?
A.
Q.

And others.
Stick with Cerberus for a moment.
The answer is yes?

15 16 17 18 19

A. Yes.

Q. And in addition to the $10,000, you
would. be paid your personal expenses and also the
expenses of whatever professional staff you thought
would assist in the job, generally?

20 21
22 23 24

A. Generally, that was the case, yes,
generally.
Q. Can you estimate for me how much money
you earned in the period from the beginning of your

(') .,..
B126

25

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Case 1:04-cv-01565-SLR

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Page 32 of 43

1 2
3

4
5 6

arrangement?

A. No. We had already altered that.
Q. Let's go to that. When had you altered
the $10,000 a day arrangement?

7
8 9

10 11
12 13

A. In July of 1999, we had altered it. Q~ Tell me about the alteration.
A. I was to work exclusively for Cerberus,
that I would have a three-year rolling contract,

that I would receive $80,000 a month plus expenses,

14 15
16

that I would be eligible to purchase some of his
position in companies in which we worked together, that I could bring companies tö him to look at,

17 18 19

that he would bring all of his companies that he

worked on to me to look at and that those companies
in which I worked, in which I improved the

20 21
22
23

companies, that I could participate in the upside

generally at 20 percent of his net gain after a

preferred return and his own expenses were taken
out and - - I mean, that's the general idea of what

24

we struck back in July of ' 99.

0

25

Q. July of ' 99?
SPHERION DEPOSITION SERVICES (212) 490-3430

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1 2
3

Crowley
time, in July.

53

i

/r'

Didn't you say that?
MR. WARDEN: Is that a question,
Counsel, or are you simply arguing with the
witness, badgering the witness?
I obj ect to this line of questioning.

4
5 6
7

8 9

I would like to know where you are going

wi th all of this. I move to strike the

10

prior question. i will ask that you move
this along.

11
1.;2

13

A. Is there a point? Q. No, there is not a point. There is a
question. My job is to ask them and your job is to
answer them.

14

15
16

MR. WARDEN: If you understand.

17
18

Q. If you don't understand the question, I
will be happy to rephrase it.

19

A. I found myself, in the summer of 1999,
spending significant amounts of my time with the
Cerberus staff and the portfolio companies.

20

21
22
23

Q. Could you translate "significant amount
of time" into a number of days a month?

24

A. No, I can't. I really don't recall.
Q. More than hal f?

t)

25

SPHERION DEPOSITION SERVICES (212) 490-3430
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Case 1:04-cv-01565-SLR

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Page 34 of 43

1 2
3

Crowley
do better.

91

Q. What was your role with Winterland
during the July to November 1999 period?

4
5 6
7

A. Chairman of the company.
Q. Were you kind of a CEO of the CEO then?

A. I was the chairman of the company. Q. Was there also a CEO at Winterland?

8 9

A. There was a CEO at that time.

10
11
12

Q. And you were his boss?

A. Yes, I was.
Q. Does that relationship continue today?

13 14 15 16 17
18

A. Yes, it does.
Q. What expectation did you have beginning
in July as to the kind of return that you could
produce for Winterland?

A. In July of 1999?

Q. Yes. When you - - well, let's start that
over.
When did Winterland become a company
that became subj ect to the 20 percent upside under

19

20
21
22 23 24

your oral arrangement with Cerberus?

MR. MILLER: Obj ection. Assumes facts
not in evidence.

0
B129

25

MR. WARDEN: Misstates the record.

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Case 1:04-cv-01565-SLR

Document 138-4

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Page 35 of 43

93
1
2
3

Crowley

AFTERNOON SESSION
(Time noted: 1:02 p.m.)

4

DANIEL

C ROW LEY,

resumed and

5 testified as follows:
6 EXAMINATION BY (Cont' d. )

7 MR. LEVY:
8

Q.

Mr. Crowley, what is your understanding

9 of Cerberus' investment in winterland?
10
A.
They own 70 percent of the debt and

11 equity, generally speaking, in Winterland.
12 13
Q.

Who owns the rest of it? 30 percent was o~ned by Gordon Brothers,

A.

14 now Stepping Stone Capital.
15
Q.
I am sorry, I

did not hear you.

16

A.

30 percent was owned by Gordon Brothers,

17 which is now Stepping Stone Capital. Both sides
18 are diluted by management options.
19
Q.

Is Stepping Stone Capital just a new

20 name for Gordon Brothers or is it new ownership
21 or - - do you know?
22
A.
I think they bought out the Gordon

23 Brothers' position in Winterland.
24
Q.

And you say they are diluted by

n
,--'
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25

management options. What do you mean by that?

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Case 1:04-cv-01565-SLR
'. .'
,

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Filed 05/04/2007

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(ì~

t.B - J) -oZ-

.~

filE COpy
Deposition of Don Amaral taken December 8, 2000
Paulson and Hi-Tech

Page 1 to Page 112

.

CONDENSED TRANSCRIPT AND CONCORDANCE PREPARED BY:
Paulson and Hi-Tech 3960 Howard Hughes Parkway

Suite 730
Las Vegas, NV 89109
Phone: 702-871-7750

FAX: 702-871-7755

B131

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Deposition of Don Amaral taken December 8, 2000
BSA

Paulson and Hi-Tech
Page 37
Page 39
(1)

lOAX(10110)

(1)
(2) (3)

(4)

(5)
(6)

I knew that you were available in the job market. O. Did you actually interview these people? A. I talked to Dan and I talked to another person. And his name escapes me. O. The -- you knew that Mr. Feinberg highly recommended Mr. Crowley; correct?
A.

(2) (3) (4) (5) (6) (7) (8)

employed to be a full-time employee of Cerberus prior to the time he went to work for Coram?
A. A.

No.

O. You weren't aware that have til just now?

Yes.

(7)

Yes.

O. Okay. The -- what were you told about his relationship with Cerberus?
A.

(8)
(9)

(10) (11)
(12)

At that -- atthe time he was recommending him, did you know that Mr. Feinberg had hired Mr. Crowley to work for him for a different company or -- or in a.
O.

That he worked one or two days per week on a
Was the name "Winterland" mentioned?

(9)

T-shirt company.

(10)
(11)
(12) (13) (14)

o.
A.

different capacity? A. Yes.
O. When did you first learn that? A. As I testified earlier, sometime in '99. O. All right. Now, did you see any problems with

Yes.

O. And that's -- that's the name of the T-shirt

(13) (14) (15) (16) (17)
(18) (19) (20) (21) (22)

company?
I assume that. O. Yeah. Were you told that Mr. Feinberg -- that Mr. Crowley also received a percentage of the profits of
A.

(15)
(16) (17)

that?
A.

No.

that company?
No. O. To your knowledge, was the -- were the terms of this -- of Crowley's relationship with Cerberus ever
A.

O. The -- was the nature and extent of the
employmnt relationship betwn Crowey and Cerberu made

(18)
(19)

known to you at that time?
A.

(20) (21) (22)
(23)
(24 )

You mean the form of compensation?

disclosed to the Board?
A.

(23)
(24)

O. Yes. A. No. O.

Or the amount?

No.

O. The ~- ther.:'s been testimony here, sir, in this

Did you know that Mr. Crowley was receiving

(25)

$80,000 a month from Cerberus at that time?

(25)

case that -- that you negotiated with Mr. Crowley the terms of his employment contract as CEO of Coram in -- in

Page 38
(1)
(2) (3) (4) (5)

Page 40
(11

A. No.
O. Did you ever know it?

approximately November 1999; is that correct?
A. Yes.

(2) (3)

A. Just now.

O. You -- you did not know that before now?
A. No.

(4)
(5)

O. And what do you recall of those negotiations? A. Most difficult employment agreement I've ever
negotiated. ... O. Well, that's not dissimilar to what others have

(6)

O. Okay. The -- I take it that was never disclosed
to the Board; correct?
A. No.

(6)

(7
j8)
(9)

(1
(8) (9)

O. The -- the Cerberus/Crowley.. .
(Discussion between Mr. Low and Ms. Harmon.)
BY MR. LOW:

(10) (11)
(12) (13)

(10)
(11) (12)

said. The -- what made it so diffcult? A. Dan's continual reaching for more. O. And Mr. Crowley wished for very highly
compensated for his services; is that correct?

A Yes.
O. And you felt that his commands were beyond what
were appropriate under the circumstances?

(14) (15)

H6)
(17) (18) (19)
. (20)

O. Let me show you, sir, what's been previously mared as Feinberg Deposition Exhibit 7, which is in fact a -- been identified as an employment contract efective as of August 1, 1999, in which Mr. Crowley was hired to be a full-time employee of Cerberus. MR. HARWOOD: Object to the form. MR. LOW: That's what the contract says. BY MR. LOW:

(13)
(14)

(15)
(16)

A. They were more than we could afford. O. And you attempted to scale him back; correct?

(17) (18) (19) (20) (21)
(22) (23)

A Yes.
Q. And were you successful in doing so? A Depends upon the time frame. Q. Okay. At least in November? A When the agreement was executed, I was satsfied
for the company and the shareholders that I had the best person in America to - to attempt to tum this company
around. ~~

(21) (22) (23)
.(24)

O. Have you ever seen this document before, sir?
A. No.

O. Were you aware of its contents?
A. No.

(24)

(25)

Q. Were you aware that Mr. Crowley in fact had been

(25)

Q. All right. And on behalf of the company and the

Page 37 to Page 40
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Deposition of Don Amaral taken December 8, 2000
BSA

Paulson and Hi-Tech
Page 49
Page 51
(11

XMAX(13113)

(1)
(2)

MR. LOW: It certainly does.
MR. HARWOOD: But go ahead. THE WITNESS: I was aware that he had asked Cerberus for an upside based on his job as the CEO of

that the risks here; that we needed to up the ante on

(2) (3) (4) (5) (6) (7) (8) (9)

(3) (4) (5) (6)

this. And I said, "Dan, that's the deal." O. And Mr. Crowley eventually signed the contract?
A. Yes.
O. Okay. The.- you say you had a conversation

Coram.
BY MR. 'LOW:

with Cerberus on the same topic?
A. Yes.

(7
(8)
(9)

O. Upside of what?
A.

An upside on their position for any improvement

O. Was that with Mr. Feinberg?
A. Yes.

(10) (11)
(12)

t,:: that they may have that he would participate. O. That he would be paid by Cerberus based on his -- any success he had as CEO of Coram?

(10)

(11)
(12) (13) (14) (15) (16) (17) (18) (19)

O. And what do you recall about that conversation? A. I don't recall if i actually had the
conversation with Steve or I left initially a voice mail for him and he called me back. But I told him we could not have anything I don't - and that could cause anyone

A.

(13)
(14) (15) (16) (17)

Correct. MR. HARWOOD: Object to the form. THE WITNESS: Correct.

BY MR. LOW: O. How did you become aware that he had made such a

to look to see if he was gettng paid for doin' his work .,.
from anyone pther than the company.

proposal?
A.

O. And what, if anything, did Mr. Feinberg say in ;.

(18)
(19) (20) (21) (22) (23)

He told me that he had or was going to. O. And what, if any, reaction did you have? .

response?
A. He agreed: ~

A.

I said i needed to think about it. This was at

(20)
(21) (22) (23) (24) (25)

the end of a extremely long and difcult negotiation

(24)
(25)

process over the phone. And I was tired and worn out, and I wanted to move on to somethin' else. And I said that I would get back to him. I called he and Cerberus the next day and told him that I could not live with it.

O. Was it your understanding based on this conversation that Mr. Feinberg was aware that Mr. Crowley had or would make such a proposal?

A. He had already made it ,_.
O. And Mr. Feinberg indicated familarity with that
proposal to you?

Page 50
(1) (2)

Page 52
(1)

O. Okay. And approximately when was that

MR. HARWOOD: Object to the form.
BY MR. LOW:

conversation? During the November 1999?:",
A.

(2) (3) (4)
(51
( 6)

(3) (4)
(5)

Yes. O. All right. Can you - was it near the end, near

Q. Is that correct?
A. Not familar. He was -- he had made it known to

(6)

(7
(8) (9)

(10) (11) (12)

the beginning, in the middle of the negotiations? Can you place it any more affrmatively than that? A Probably in the middle. O. And you spoke to Mr. Crowley, as I understand your testimony you've just given, and told him that you would not agree to such an arangement; correct?
A.

me that Crowley had already hit him up for it.

(7) (8) (9)

O. All right. And did Mr. Feinberg give you any any sense of what his Feinberg's reaction to the'

proposal? .. .
A. He agreed with me that the CEO of Coram could

(10) (11) (12)

not be compensated by also the debtholderS:. i.)
'.,"'

Yes. O. And what reason did you give, if any? .

O. Okay. Did he say why?

A. No.

(13)
(14) (15)

A. That he could not be paid by the debtholders.

(13)
(14) (15)

O. Was the term .conflct of interest" mentioned?
A. No.

the company. . 0 '"
O. And what, if anything ." and what - and - and was that in fact your reason for opposing such an

He - he wa a: full-tilTe employment (sicl - employee of ...;

O. Was your understanding that that would be a

(16)
(17)

(16) (17) (18) (19) (20)
(21) (22)

confict of interest?

A. Yes. .

(18)
(19)
(20) (21)

arangement?
A.

Yes.

O. Okay. The - did Mr. Feinberg at that or any other time disclose that Mr. Crowley wa a full-time

. .
j..i'!

O. Okay. And what, if anything, did Mr. Crowley

say in response?
A.

.. dollar a year ~~

E7mployee of Cerberus being paid close to a millon

(22)
(23)

He whined.

(24) (25)

Can you be more spe