Free Appendix - District Court of Delaware - Delaware

Case 1:04-cv-01565-SLR
u.ll-1

Document 125-13

Filed 04/17/2007
IU

Page 1 of 30

14ibi

L11IbJ

Suite

itco Co1oado
8o2o2

Denver

303.9.4973
303.298.0043

8oo CORAM

HC

PA

March

2002

______
Board _________ of Directors
Nealthcare Corporation

COE1DENT1L

Coram

Dear Fellow Board

Member
activities at

_________

This isa brief update of the

Coram

Preliminary Million
in

estimates

indicate

that

in

January 2002Coram $34.97
Million that in

earned

approximately $2.05

EBITDA
after

on approximately
the reduction
unilateral in

Net Revenue

Remember
offset

that

_________

this

comes

Vancomycin
cut taken

caused an
last

EBITDA
summer

of nearly

$1

.1

Million due to the

price

by Abbott

Februarys

sales trend as indicated to

by Revenue 2001

Per

Day
is

is

estimated sixth
it

at

$1605719
net

This compares
sales

$1458000

in

Febmary

and
last

Corams
letter

6th month of

gains in

row As
sense
to

was discussed
this

in the

Board

probably doesnt make
that

_________

any business
this

annualize

number
year

seasonality

etc but
compare

said annualized $390
to 70.2 as

represents for

nearly

$410

Million

which

would was

to

the unaudited

________

.Million in

2001

Februarys So we

preliminary progress

Core
in

at

71%

which book

compares of business

February 2001

made

changing

Coraitf

well

Corams

cash collection
City to the
that

effort

continues
result in

in

earnest

We
the

now have an agreement
$1 Million.in

with

Hu.rnana-Kansas

will

Comm

receiving with

the next several

weeks
to

related

aged

billings

we

discussed

Board

Similarly

United agreed

make

payment

of $300000

Cash

in

Corams

checkbook
current

as

of

this

morning was

$24.1

Million

Accounts

Payable

remain relatively

With
________
Ernst

regard

to

the

Young
voting

EY
rights

SEC

matter
that viii the

discussed resolution

with the Board we have
to

now
to

been
that

infonned by

the

2001
this

de-consolidation

we proposed
review of
staff

regarding

satisfactorily

resolve

matter
at

subject

th SEC

our response
has

letter

regarding to
get-

primarily

consolidation

been

directed

the matter but that

documented
it

EY
going

December 31 2000
has also

Coram
that

informed us language

they will
the

issue an opinion
uncertainty

for

2001
the

will include Trustee

concern

reflecting

related

to

appointment of

proposed

by the Trustee however

the opinion

will

and any potential Plan that may be still be unqualified

CRXW045

A901

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007

Page 2 of 30

Page2of2
Letter dated

Pages

March

2002

to

Board

of Directors

Corain

Healthcare

Corporation

Finally

the

Equity Committee
as

filed

an objection

to

the

Boards
filed at

Motion for the place holder
to

KERP
objection

payments
asking the

only

they

relate until

to

myself
Trustee

The US

Trustee

Court to wait
in

actually

shows

up

Corarn

in order

allow that

person to weigh
believe that
it is-

on the matter
to get
this

Copies of these objections

are attached
that

firmly

important during

KERP
at

approved

to

insære
it

we
to

retain the

management team
discuss that face

period

of uncertaint our March

As

relates

myself

prefer

to

to face

with the Board

14th

meeting

Sincerely

Daniel

Ciowley
President

Chairman

CEO

Cc

Fxiednian

Feldman Marabito

CRX

00046

A902

Case 1:04-cv-01565-SLR
r-Q LJ

Document 125-13

Filed 04/17/2007

Page 3 of 30

j4.J

IULt
RIIHt
302
421

JH1

891

TO

24

1A3S1C539

ORIGINA
IN UNITED .srMEs
fl1SflJCT

FOR TRE

BANKR1WCY COVRT OF DELAWARE

INRE CORAM BEALThICARE CORP

ChzpterLl

-Case

nd CORAM I4C.
Bithturs

and

No 00-3299 l4FW CseNo 00-3300 FwV

3uixiIyMrnInktred
.Reltdtd
to

Di.

No

1431

Otdcdioi
ileiring

Dudllne

2i1Iol

400

pj

DsIe 30102

40O

EQVITY COMMITTEES

LThdITED

OPPOSITiON

TO

DE8TOS MOTIONS FOR ORDZRS AIJIEORIZING OF KEY EMDLOE RETENTION PLAN FOR
PERMITTING PAYMEmS INTO NEVflCEY VIEPEUNDERI

MODrEICATION 2000 AND AND 11 ENTERING

RETNTIQN

LA1QR
to

2002

The

Equity

Comtniuet.

by

its

counsel

teponds

Debtors

Motion

seeking

aoxioation

to

pay

certain

tmpoyees

stay

bonscs

to

rnadifj

it

2000

icey

Empoyce

RCteLtiOt1

PIan

KEIj
thc

and

to

adopt

and

implement

new 2002

CRP

as

lbliows

Wtli

Respect

to

ytat 2000

ERP
strongly supports
the notiofl thas

-The

Euicy

Committc

employees

who

were

awardcd

rcteion

bonuses

in

the

year

2000

subject

to

confljmatinn

of

Plan

of

R.eorgnnizanon

should

now

receive

the

second

ball of

thei

retention

bonus

notwithsT.allding

Debtors

inability

to

cauftrtu

either

of

its

Plans

because

of

antiuuing

conflict

of

ijuerest

CRX
Don Crowley and Crrberu1
principal

00047

Noteholdee

Howcvcr

the Equity

CommiTtee sungJy

opposes

the

pymem

of

any

tttentio

bonus

to

Mr

Crowky

01

Ft1EO4-4

A31NQL3

NUQ 01

tO

86

Wel0J

650t

ZOO

p2 3W
TO

A903

Case 1:04-cv-01565-SLR
202
1430
FR

Document 125-13

Filed 04/17/2007
TO

Page 4 of 30
P.13

9164495059

HRE1BER

riflR

11

cin-aL-2

o1t

kSOWTZ.BNSb

4PbJU

J3

On
the

lebruaxy

27 2002

the day betorc thesc ObJections

weteduc
of

the

Oebtar

providcd

Equity

Committee

with

details

concerning

the

iccipieits

payments

if

the

MorIofl

is

approved.

Aeeordumg

to

the

dcumneius

received

Dxt Crowiny

to

retcjvc

$800000

The

Comntnee

belives

that

this

Coiirt

Pldings

of

Fact

ar4 ConclusiOns

Of

Lw
Mr

ci

forth

in

Its

Deeenber

21

2001

Opinion

OpInion.

preclude

.1

payuiear

to

Crowicy

The

decision

to

sce

Court

ftppmoval

for

payrncor

of

$800000

Crwley

was

apparently

made

at

Coram

Hea1thcre

Corpontion

directors

sneering

on Januasy

10 2002

No

reason

is

oiTered

in the

minutes

of

that

meeting

that

west provided

to

the Equity

Coromiuce

as

to

why

the outside directors

at

that

meeting

which

wus chairrl by

Mr

Crowley

did

not

take

the findings

of

the

bpbiori

mb

consideration

WJtIt

uspect

Co

the RILpICM

To Enter Into

New KERP

for

the

Year 2002

This

motion

was

filed

the

day

tftct

the

Court

ordcred

the

appointment

of

hapter

11

Tnstce

Any

new

KEIP

chcrnld

bc

approved

by

the

Trustee

who

is

likely

to

be

appointed

before

thebcaring

date

set

for

this

Motion

If

on

the

hearing

date for

this

Motion no Trustee

his

been appointed

then

the

Etuity

Committee

will

not

object

to

the

awarding

of

retention

bonuses

as

propose

but

subJCct

to

the

Condmton

that

no amouut be awarde4

or

paid

to

Mr

Crowky

Board minutes

proVided

to

the Equity

Committee

eu

Fctruay

27

2002

show

that

it

is

proposed

that

Mr

Crowley

receiv.c

in

axldiriotiai

5400000

pursuant

to

the

2002

XERP

As proposcd

200.00O

ofth

ould

be paid on Maxth

31 2002

Thus

the

toinl

that

C1tX00048

cr

A1OLD

HtKI

01

t0

OGZ

gt

WUL03

5@t

00

TO

itJW

A904

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007
TO
bitJI

Page 5 of 30
P.14

riii

.6
11

2002

14-i0

916449E59
L-I

SCHREIBER
TO

p5U1TZ.DENSOPI

ri

Z34

L4

7S28 P.04la

would

be

paid

to

Mr

Crowley puru3t1t

to

the dccisons

of

the

oulsid

dirxtoi

would

be

Si milliun

The

minntcs

1so snow

th

rii

uggerton

topsy

this

Si million to

Mr

Crowtey

was deleg4ed

to

inn

enienL

by

the

outside

drcctors

3anuy 10
of ctre

2002

Minutes

page

Once

gafn 10

ik

owside dixaots 1ave

failed

in thcirduty

The

2ctlon

of

th

outtide

directors

in

uthomzing

the

flUng

of

motion

ipproving the new

KERP

after

the

Cowt

orderc4

the appoin1mr.nx

of

trustee

is

Improper

prticularly

in

ligbt

of the

Couns Pinding

in the

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the

conduct

of

these

outside

dbcciois

CRX

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Case 1:04-cv-01565-SLR
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Document 125-13

Filed 04/17/2007

Page 6 of 30
P.15

11

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Case 1:04-cv-01565-SLR
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Document 125-13

Filed 04/17/2007
TO SCHREIBER

Page 7 of 30
16

11

2002

1431

FR

r1R-i-202

1012

Kq
tJNITED

9164496059

STATES BLNXItUPTC COURT TUE DISTRiCT OP DLAWARZ POR

Inre
clapterfl Cor8ln

Heithcare

Coip and Conztn

The
Case

Number 00.3299

MFW

JoinrlyAdrthnhtered Debtors

1T

IKE VITED STATES TRUSTEES OBJECTION TO MOTION FOR ORDERAUTHOIUZINGDEBTDBSTO WMODrFYKEYEMPLOYEE XCZTENTION ILAN FOR TUE YEARO00 ND MAKE EMAINJNG PAYMENTS TRREUOEflI AND II ENTER INTO NEW KEY EMPLOYEE TETENTIO kiE.Q.R TILE A921ReIJkt J43fl

In support

of

his

Objection

to

1otion

for Order.Auihaizing

tebtors

to

Modify Key

Empioyco

Rotcntion

Pun

for the

Year 2000

andMake

Iemaining

Pwcnts

Thcrcuzider

nd 11 WaIto
coonsc

Utcr i1oNew
thc

XcyEzuployecLtcnticiu

1a1

for

theYear

2002 the

Motion
through

Dooald

Acting

Unite4

States

Trustee

for

Region

i.JSTU by

and

utidciiied

bthstate
Pzrant
1o28

U.S.C

l57bXA and

this

Coiui has

jtzrisJction

to

hear

the above-rcfereced

Objection

u.cuan

to

28 U.S.C

S86

the

UST

is

xsponsibk

for the

vpervision

and

admMcwazion

of

all

ces
to

u.dat

Chapter

11

Title

II

Uuitcd

States

Code

Pursurjc

11

U.S.C

301

The

USTha

wdingto beheerd

with

rard

to

the

abov-rcferencedObjecticm.

The

UST

objects

to

the

Motidi an

the

following

grouniL

OnFthniaxyl22002thisCoOrderdireclingtheU5Tto

CRX

00051

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oi

oo

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Case 1:04-cv-01565-SLR
-rii-

Document 125-13

Filed 04/17/2007
TO

Page 8 of 30
P.17

ii

ai02

1431

FR

9164496@5

SCHREIBER

rvp-0i-2ee2

i.Or2

KSJITZ.S__

appoint

Chapter

11 Tiuttoc

tfl

tI1i

Cue

While

no

Chajtet

11

lLUl

has beei ppoincod

tc

date

the

UST

icipares

that

Such

nppoinzmut

will

be made

in the

vely near frnutc

Upon

his

or bci appointr.cn

the

Cliapur

11

Trustee

i11 be soldy

chrgedwithopcrationbfthcbebtorsbusineas

the

3dmin

riionofthe

estate

irid

all related

atter

The Mo1ioi

raises

issues

whicb

upou

appointrncnl

of

the

hptcr

11

Tmstee

inaynoluxtger

be

pwued

by

the

Debtor

acting

at tht

dfrection

ofils

Eoard ofDireclors

due

to

lack of standing

The

maxters

raised

by

the

Motion

are

Solely

withh

the

discretion

of Chapter

ii

TtUSLCC

to

be

exercised

in

nattei

cmtont

with

the

Chapter

11 Tiurtecs

duc.iaxy

duties

to

the

estat

and

may

bc

P11r5JedbYtbeChapteºll

Tfdcedappropthte
be denied without

The Mo1io bouId

prcjucpiding

tcvie

by the

Chpter1lTnistce

.5

The TJST kaves

the

Movnsic

its

bwdrn

md

ctvcs

ll dicovetyijghts

TntertionaUy

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CRX00052

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96

t.ThIOD

19

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Case 1:04-cv-01565-SLR
11

Document 125-13

Filed 04/17/2007
TO SCHREIBER

Page 9 of 30
P.18

Nc1R

2802

1431

FR

9164496859

i.8039d

1W.OI 1.0t

ii-O2882

QSIrZ.BENSOJ
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USThE

oa4/Doa

WHEREPORU
Motiuii without

the

LIST

rcspectft

rcquc
aud

thBtth

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dcnyivg.thc

prcjucc

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for

sueh

other

ithnrcIicf

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des

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equitthlc

ysubmined
DQNALIJ ACTING

WALTON
UNITED STATES TRUSTEE

BY_______
Don
Txii

Bone

Esq

Mornoy QIce of the U.S

Trulee

Cleb oggs cdraI uildhg

844Xngxet SuitZ313Lcckbox35 DE 19801 Ihoi 302 573-49
WiIniiigron

Xfr 302 573-649

Date

Fthniary

27 2002

CRXOiJOS3

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Case 1:04-cv-01565-SLR
2O2 1229
FR

Document 125-13
HEnLTHCIRE

Filed 04/17/2007
5164496a59

Page 10 of 30
P.e2/5

ttY

@7

CORt1

TO

CORflII

EXECUTIUE

11

r2evenceenlhScrccc
Suuc 2100

Denver

CoIodo

S.ao2

303.29249731
303.298.0043

030

COM HC
corn

www.cosrihcithciec

May

200
Adams CorMn
Segal Healthcare Corporation

Judge Arlin

Chapter 11 Trustee Schnader

Hanion

Lewis LLP
19103-728

1600MarketSCetSUite3OO
PliladelphiaPennsylvaflia

Dear

Judg Adanis

included 11 Trustee our duties that as Chapter you stressed To that end you requested cash of Corani management mamtaimng close oversight With the last weekly basis detail of Corams cash actwities on

When we
that

met in Denver

we

report

the

several

weekly

reports

now

in

band

hopefully

you can

readily see

that this

have

mainlained

________

fairly

disciplined

and quite rigorous

cash management

prbgrarfl in

Company
that

Prior

to

myjoining

Corarn Management took leavug
substantial resources
its

deduction tax and cash

lot

tx purposes
to

has been

subsequently the

disallowed

problem

be dealt with in Corains and

Chaptet 11

The firms cash
of
diet

were Days

essentially

uncontrolle.d

Accounts

Receivables

went uncollected
steady
its

Sales

Outstanding
its

ballooned

Coram

lived off

of expcnsxvc

draws

until

Revolver Revolver

was

nearly

exhausted

To fund

operations

Coram went from
poor
to

zero

balance before

on
joined

November 30 1998
CorÆrn as

to

$44000000
took

my

amval

The week
to

CEO the
Not

Company

drawof $7000000
to

fund payroll and
in the
field

ge

off

credit hold with key vendors thcrapy
pretty picture

that refused

ship drugs

needed

for infusion

Immediately out and

after

Ijomed Corarn we went
In
to

to

philosophy

of

use

up

fix

it

up
the

wear

it

do without casts and

essence

squeeze cash

the

buck

We

set

up goals to change program

mix

to cut the

collect the

We

began
real

thoughtfil

targeted

to

clect our Accounts
vendors improving
In other

Receivable

and to restore
to

working relationship with
abilIty to

Corams

words we sought
bills

restore

Corams

do business

by

cash flow paying

on time and acting responsibly

Cl-i-%

TRUSTEE
004289

CH-11

TRUSTEE

CrowleyAdmiflOl5S5l

A9 10

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007
CORM

Page 11 of 30

MY

@7

2002

1229

FR

CORI1

HERLTHCRE

9164496059

tO

EXECUTIVE

P.03/05

PaL2of4Pages. Letterto Judge Adams

dated

May

2002

We

believethatoperatiois Thats.not

should Corain
its

generaliy.be

funded
It

byproperly managing
to

the

businss
.DcJlar out to

what

had

been

doing and

was borrowing
to

fund Million

sales

meetings fund

generous

401k
thats

be serious Corporate mistakes
has

And
enough

that turned pay for strategic forays why we arc quite proud of the fact that

Coram

managed

its

affairs

well

not to

need

even
to not paid

one

draw since Januaxy

Company well enough 2000 In fact we mailaged 2000 but to get Corams bills the reydler by August
the relationships

only completely pay
its

22 bak

current improve
positive

vendor

and eliminate too

aft

credit

holds

and create

reliable

daily operating

cash balance

Unfortunately

Your

Honor
from

based

on the Caremaik Aetna and
thiougJi

Net issues

significant

losses were recorded

1995

1999

In

the

end Corani amassed
the reason
its

over

$304000000
two-fold
the.principal the

in debt

bythe
that

nd

of 1999

essence of

for the insolvency

was met

The

fact

Coram was

in violation

covenants
losses

and

could

not

repay

On loans that were due and

because of
to

its

Corarn no longer

$75000000

Minimum Net

Equity

required

qu.alify

for the public

company

exception

under Stark

Of

course by now you have
ability to to

1erned
accept the

that

Stark

11

is

key regulatioii MediCaid

that

relates to

..

Corams
matter

reasonably

Medicare

and

referrals

These
its

eferra1s

greatly

Coram

becatise

Company
patients

generates In

the majority

of

Total if

Gross
lost

Margin

from
II

Medare

and MediCaid
it

my professional
ability

opinion
its

Coram

the Stark MediCaid

exception

sunply would
as

up-end
its

Cot-ams
business

to retain
is

Medicare
in

and

referrals

as well

moSt

of

other

That

because

many
also

circumstances Commercial
it is

the

same

doctors

that refer

Medicare

and/or

MediCaid
.andlor

patients

rdcr

patients
that

Once
their

doctor

stops referring

Medicare

MediCaid

pattcntS With

most

likely

referrals

of Commercial

patients for

would

dry up too

Corams
days
that

average
if referrals

patient dried

only

staying

on

senicc

approximately

twentyone

21

up
II

Coranis business

qualifying matters

for Stark

and

bem
that

We believe could go away fairly quickly and MedICaid able to efficiently take Medicare
the

patients

We

also believe

Gros Margins
without these

coining patients

from Medicare

and no

MediCaid
longer

are significant viable

The point

is

that

Corani would

Company

..

..

CH-11 TRUSTEE 004290
CH-11 TRUSTEEI

CrowleyAdmn015852

A91

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007

Page 12 of 30
E.04/05

MY

07

@02 1229

FR

CORAII.HEflLTHCARE

916C5259

TO

COR1 XECUT1VE

Page
Letter

of
to

Pages

Judge

Adams
below
its

dated

May

2002

From
pain.fi.il

the table

you can easily
to fund

se

that

Comm

was out of control and
for

made

use of
are

Revolver

its

insatiable appcute revolver

cash

By

their

nature
it

revolvers

qwte

expensive

Corams
is that
it is

was no exception manage

in that

had
well

very

high interest cost

Our view when

companies
to

should
fuel

tliu operations and profitable

enough
Based

to

only bolTow

necessaiy

accTet1v

growth

upon your

interest

in

Corains

cash
after

situation

thought

you might Here
is

like

to see
V.

Comms
situation

cash history both before and developed from January

became
until

CEO

how Comms cash

1999

August

12000
Revolver

Date

Borrowing

On
1/1/99

Revolver

Paydown

Balance

Outstandhg

1/10/99 1/14/99 1/21/99
1/25/99

530000.00

$3000000

$5OQOQ0
$30Q0000

$8000
$11

oooooo

S1O00000
$1Q00000
..

$10000000 $11000000

1/26/99 1/28/99 2/9/99 2/18/99 3/9/99 4/14/99 7/25/99 7/26/99 1.1/25/99
115/00

S5000000

$2000000 $1000000 $6000000 $7500000 811500000 $3000000 $7000000

6000000 8000000 9000000
815000.000 $22500000 $34000000 $37000Q0O $44009000

53000000
..

$41000000 $42500000

1/22/00 3/1/00 3/15/00 3/29100 4/11/00

$1500000

4/25/00
5/2/00 5/11/00 5/16/00 5/23/00 6/6/00
8/1/00

51000000 SI 000000 S2000000 $2000000 $1000000 $1000000 S500000 S1000000 S20000O0

$41500000 $40500000 $38500000 836500000 $35500000 $34500000 $34000000 $33000000 S31000000 $28500000

S25OO0
S28500000
as

Crowley was Appointed

CEO

on

11/30/99

VV

VV
CH-11

H11
TRUSTEE
CrowloyAdmin015853

A9 12

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007

Page 13 of 30

PlcW

07

2002

12

30

FR

CORZ1

HELTHRE

9164496059

TO ccii

EXECUTIUE

85/05

Pate
Letter

of to

rages Jtdge

Adams dated May

2002

Analytics

There

down theR.evolver substantially improved prove that paying The cost of those Revolver funds in Ebitda really is an

Coraufs situation
versus the return net loss

ITDA
tle

on
for

the

capital

employed

was

negative

Every

day The Revolver

was drawn

was

Coram

By

sellmg

irms

ihannacy was

unit Coram Prescription
draining cash

Services

CPS
13%

Coram was
of CPS

able to eliminate

unit that

and had

inferior

xnargms

versus27-28%
sate

on Infusion

With back

the closer

management of
saving Millions

operations

and cash and the

Coram

paid

the

Revolver

in net costs

Of course Coram
large

has not

ben

pÆying.interest

on

its

debts

sincefiling

for

Chapter ii In

in its why Comm has been able to Bccurnultc $30374290.18 of $6899693 83 less checkbook Month 10 date Coram is cash flow positive Receipts If the firm had to make the.interest payment on the Disbursements of $6227642.23

measure

thats

totl debt
difficulty Infusion

outsiatiding
It

roughly

quarter

of

Biilion-

DoIlais
it

it

would

have
for

serious

could

not

make

the

payments

nor.could

find the funds payroll
their

companies buy to 30 days cash needs ut 90 days
for

their drugs while

and supplies

make make
issue

and

fund operations
for

working capitaL with
services has ton in

payors actually
the Staik
II

payments

80-

The debt
capital

is

unmanageable
its

remains and need
for

Comm

basic

need

to fund

operations

Therein

lies

the

Reorganizat

-Because service solvent petition

Comm has

the

IRS

liability

and has aBalaflce

Sheet loade4

with Debt

it

cannot

to compare Plan of Reorganization it is illogical or re-pay Billion Dollars doss not have healthcare provider that quarter of of $40 Million with -Corams Debt/Equity debt on Net.Revenues

absent

Corazn to any of pre ratiowith

Corams

Stark

II

reality and

Corams need

for

working capital phase of your work its histo and its
feel is

Your Honor

recognize paper

that

you are

still

early

mthe

fact

gathering

Hopel
day-to-day please
let

this

will
If

ode some
any
will gather

useful other

del
for

about

Co
you

issues

can provide

information

that

important

me know and we

the data

you

Sincerely

Daniel

Crowly

Chairman President

CEO

CH-11

TRUSTEE
004292

CH-11

TRUSTEE

ThTPL

PclGE.05

CrowleyAdmjnOj5g

A9 13

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007

Page 14 of 30

CORAM

HEALTHCARE

i75Broadvay Suke9ao
Denvec

Coorcto

82o2 Boo

303.292.4973 303.298.0043 www.corarnhc.com

ciwc

iic

FX

VIA FEDERAL EXPRESS

November

2002

Mr

Keith

W.

Muthford

Ewing Monroe Bemiss Bc Co Riverfront Plaza West Tower
901
East

Byrd Street

Suite

1650

Richmond

VA23219

RE

Coain Data Request

Dear Keith

Eiwlosed please

find

communications
listing

from Mr

CroWley

to

Judge
follows

Arlin
this letter

Adams
Please

regarding

.Corams operations few communications
as the

of the enclosures

immediately and Judge

note that package

between

Mr .Crbwley

Adams

wer

excluded

from

this

memorandurs
you have

were non-operating

in nature

Should

any questions

p1ase do not

hesitate

to give

me

call

Sincerely

Senior

Vice President

Chief Financial

Officer

Treasurer

Enclosures

-cc

Joseph

Devine

Bsq

including

all

enclosures

\_

CH-11
ACIICJ

TRUSTEE
003163

A9 14

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007

Page 15 of 30

M.ADAMS CHAPTER

CORRESPONDENCE FROM DANIELD CROWLEY TO JUDGE ARLIN 11 TRUSTEE FOR CORAM HEALTHCARE CORPORATION

FROM MARCH11
Date
of

2002

THROUGH NOVEMBER

2002

Correspondence

Subject Overview Update History Letter Leterto
to the

-ijch

2002 MQ0V /9
2002

l1002 4lg.2QQ2

BOD

attached

BOD

attacked

LI

Approval Authority Seventh Month Sales Update of Activities
Daily Increase
at

KBRP

Coram

Al-.U.29Q

Cash

Ap
Ai
Aptil-

Report

20Q
20.D2

Weekly
Daily

Repurt Cash Report

22200-2

Weekly

Report

PXi 24

2Q

EBITDA Report
Weekly Weekly
List Sales

_____________________

Report Report

20Q2
2002

of Borrowed

Money

and

Payments

Up

in

May

.iOO2
LtY
16 2002
Z092 20Q2

y.i2O92 My2Q
Mny 30
J.une

Weekly
Daily

Report Cash Repori
Services

Corain Prescription Weekly Weekly
Interim

CPS

Report Report Report Report Report Key.Performance Report
Indicators

2002

32002
-2002

Weekly Weekly
Inventory

V1U11

42Q2 i7.ti2
2002

Weekly

Preliminary

EBITDA

_________________ _________________
______________________ ____________________

Weekly Weekly Weekly Weekly Weekly Weekly Weekly Weekly
Daily

Report Report Report Report Report Report Report Report Net Revenue Report Report Report Report Report Report

122

2002

002

gq54qO

02
13QZ

ust 19.V20

4t

WeCkly Weekly Weekly Weekly Weekly Weekly

26 20k

_______________

t2002v
r9

tor120O

CH11TRU

A9 15

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007

Page 16 of 30

___________________
Sptiie.raC.2QO2

Weekly Report Weekly Report Weekly Report
Daily Cash Report

___________________
@1cber

IG

O2 17OO

OO2

Weekly Report Weekly Report Weekly Report Weekly Report

_________________
____________________

September

Financial

Results

Weekly Report

003165

A916

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007

Page 17 of 30

iI
ATTORt
EYS
Al

LAW

215.751.2000

FAX

215.751.2205

schnador.com

D.ecember

24

2002

BARRY
Direct Dial

BRESSLER
215-751-2050 2t5-751-2205
bbrssIersc-hadFr.com

DirectFax
IntemI

Address

VIA FACSIMILE
Scott

312-621-1750

Schreiber Shehst

Esquire

EXHIBI
Ament
2100 Rubenstein

jJ

Much

Freed Denenberg
Suite

Re

In

re Coram Healthcare Crowley

Corp

Debtor

/Daniel

Dear

Mr

Schreiber

Per

our additional
Corporation

discussions

Mm

Adams
the

the

Chapter 11 terms for

Trustee

for

41

Coram

Healthcare

Coram
the

has modified

proposed

termination to approval

agreement
the

and extension Court
to

of employment
include

with Daniel

Crowley

Dan

subject

of

Bankruptcy

following terms

Dan

has terminated

his

prior

Employment Agreement placeholder motion

as

amended

Employment Agreement
Employment Agreement
Under Transition
continue
to

and the Trustee

has filed

to reject

Dans

old

the

proposed and

termination

and
that

employment

extension

agreement 2003

Agreement
render
earlier

the Trustee

Dan

agree to

commencing January
as

Dan

will to

essentially the

same

services

Coram

he has heretofore
the date

for

term not Plan
is

exceed

the

ofa
order

six

months
court

from January

2003
in the

on which

confirmed
or

by

final

of

having jurisdiction of Plan in the

the substantial

consummation
to

Coram Bankruptcy final order Coram Bankruptcy The term could be
if

extended
before written

once

for

up

an

additional
either

sixty

60

days

final order

has not been on
thirty

entered

on or
prior

June

30 2003

unless

party

terminates

the

arrangement

30

days

notice

1111

Schnder USONMA Si
FIEWfORKNf
CANONSIUFG.PA

Harrison
CItERRY

Segal

Lewis
SAN

LLP

PHLAUELplA.PA

FIIANCISCOCA PTTStURGIIPA HILLNJ HARRIStURC.PA

WAJ

t925_

A9 17

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007

Page 18 of 30

Schnader ATIQa
LYS
/T Scott

L.W

Schreiber

Esq

December 24 2002 Page2

Dans
on
the

current as
it

at

will

employment

will continue

until

December 31 2002
while

same

tenns

and

conditions

under the old Employment
to the

Agreement

we

finalize the

Transition will receive

Agreement
the

and

submit

Bankruptcy
as

Court under
the

Through

December 31 2002 Dan

same monthly
Under

salary

and benefits

Employment Agreement 2003 Corarn
and
will

the Transition

Agreement

beginning January payable

pay Dan
continue Solutions

base monthly
to

salary of $80000.00

Monthly Salary

as heretofore Healthcare space in

Dynamic
California the six
still

reimburse direct costs and expenses incurred by Dan or Dynamic on behalf of Coram or Corams employees occupying on the same basis as heretofore of the Transition Agreement
during

Sacramento
If

Corams

bankruptcy proceedings

during

months
be

the Trustee

terminates

Dan without cause
for

Dan would
If

entitled to

be paid his Monthly
for

Salary

for the balance not

of the six month period
Salary

during

that

period

Dan

is

terminated

cause

Dan would

be paid the Monthly

the balance

of the six month

period

Under
perquisites

the Transition

Agreement
provides
to

Comm
on

will continue the old

to provide

the other

and benefits
including

that health

Coram
dental

currently

Dan under
the

Agreement
to

and

disabilfty insurance

same

basis

Employment as made available
transportation

senior

executives corporate

of Coram housing

$1000000.00
in

of whole same

life

coverage

an $1800.00
gross

allowance
certain

Denver

on.the

basis

as heretofore

up for taxes on
in the course

benefits rendering

on

the

same basis as heretofore
for

reasonable

expenses

incurred

of of

Dans
the

services

Coram and

tax

preparation

costs of $10000.00

for the six

months

the Transition

Agreement
not

tenn of the Transition companies
in

As heretofore Dan may maintain his interest in Dynamic and during Dan agrees on behalf of Dynamic that it may consult with Agreement
with neither

other

direct competition for

Coram

except for the Noteholders/preferred
shall

stockholders consulting continue
to

or their

affiliates

which

Dynamic nor Dan

consult

so

long as such

does not substantially detract
guide

from Dan rendering
as heretofore

the necessary

time and effort to

Coram on

the

same

basis

DO

-During the Transition coverage covering Dan
to the

Agreement
available

Coram would
to
all

continue officers

to

maintain
directors

same

extent

Coram

and

In consideration the Transition Trustee This will Period

of

Dans

agreement

to forego

other

opportunities

during the

and

in partial

recognition

of his efforts over the past nine payment
totaling fees

months

pay Dan

stay and performance

$1000000.00 not
to

Stay Bonus
$200000.00
paid
as paid

will

be accomplished

by reimbursement for counsel Agreement by the Court
or

exceed

on approval
stay
first

of the Transition
paid
at

with the balance

of $800000.00

bonus occurs

the

end

of the six month period
entitled to the Stay

upon

final confirmation

order whichever
order
is

Dan

will be

Bonus whether

or not

final

conflmiation

entered

PHDATA

026985_1

Schnader

HarrIson

Segal

Lewis

LLP

A9 18

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007

Page 19 of 30

Schnader
AT1ORN
Al

lAW

14
Scott

Schreiber

Esq

December 24 2002
Page

The

Transition

Agreement and
will

will

be governed

by Colorado law as was
in the

Dans
Court

old

Employment

Agreement

be enforceable

by either party

Bankruptcy

The
Court

Transition

Agreement have
an

will

be subject
date

to

approval

of the Bankruptcy
will request the

The

Transition

Agreement approve
it

will

effective

of and

the Trustee

Bankruptcy

Court

to

as

of January
will

2003
consultation will

10
title

The

Trustee

agree

after

with

Dan on

an appropriate and

job

during the Transition Officer

Agreement which

tentatively

be Chief Transition

Restructuring

BARR
BEB/sh

Cc

Arlin

Adams

Chapter 11 Trustee

Mr
Agreed
as

Daniel

Crowley

to

Terms and Conditions

DANIEL

CROWLEY

ARLIN

ADAMS CHAPTER

11

TRUSTEE

i11i

PHOATA

1026985_I

Schnader

Harrison

Segal

Lewis

LLP

A9 19

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007

Page 20 of 30

14

SL1S1

5ii21

HO.i
1II

P4/4

Schnader
Scott

rib Esq
2002

oltI

Poymt Akae
Th

mid

be

eab1e
w11

by

Aer ar

In

th cidpcy

irIu1L dULui wnuiu
nktiity CourIt ippcv
10 tLt
it

aApecnint

ubjctta
ii

Rcucfm Qcr

dud

thi

iihiaAgrint wb ti@ve1y

Th

lioi opij1
mey
law

wi WL

va1

of tA

rU4LU wkn LILWJL

2003

will

mton

zxtd

7A%
CC

Al
Thw.s

Ctez11

Tcutc

Ag

CUtUJittOii

DALCOWtEy

ARLtM

AAM HAtER TtW
Ii

_________
.10
141
It

Shdr
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sI
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A920

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007

Page 21 of 30

L. ii ri

G3
LYS AT LAW

AaY.I

I1

IC.23

sJ

ATTOftN

25.75

Z3O

rx

BARRY
birect Direct Fax

January

2003

BRESSLER
215-751-2205
bbnuli

Dial 215-751-2050

rnNnl AddTeU

nidu

Y14i

FACSI14ILE

312-621-1750

Scott

Schreiber
Shelist

Esquire

Much
200

Freed

Denenberg
Stxeet Suite

Ament
2100

Rubenstein

North-LaSalle IL

Chicago

60601

Re

In

re

Corarn Healthcare

Corp

Debtor

fDaniel

D.Crowey

Dear

Mr

Schreibr

Per our

additional

discussions

Arlin

Adams
Crowley
terminating

the

Chapter nave

11

Tristee

kr

Coram
letter

Healthcare

Corporation

Coram
employment

and

Dame
for Tratisition

Dan

enteted

nto

agreement and

the
extending fdr

Transthon
his

kgreement The

Dan
will

prior be

Emplpmei
to

Agreethent

Agreement

submitted

Bankruptcy

CoUrt

approval

This

letter

will to

serve be

to

reflect into

the intent as

to

an additional and
the

settlement subject

agreement
to

SettlemCnt
agreement
Settlement

A2reement
being Agreement

entered

between
to

tie

Trustee of
in

Dan

formal
Toe

drawn and

subject

of course and

approval

Bankruptcy
with

Court
the

is-beirig

negotiated

finalized

connection

Transition

Agreement and

will include

the following

terms

All

of Dan

contractual

and
all

employment

claims
his

for

performance

bonuses

KERP
not

Ml
with

and
in

otherwise
the

including

any and

Eaims

under

old and

Employment
satisfied

Agreemeit
additional

dealt

Transition Plan

Agreement

will be

compromised and
the

by an

payment below

ipon

final

confirmation

of S2000.000

exchange

o-freleases

providd

Dan
Plan and and
the Trustee claims

will

release Debtors

the will

Trustee
in

and

Debtors

from any from
all

furtithr

claims

as part

of

the

and

turn
to

release

Dan

proposed claims

derivative
that the

aims
Trustee

any other

arising out of or related

such proposed

derivative

Schnider
000 TO

Harrison
PA

Scgal
CM
PA

LWiS

.i.P

N.UA

SW

O.hY0

.iA0ILpHA SS.PA

ITSAUA
RY

C.a

HILL.J

SAN FOANC MAP R3l.R0.PA

CA

ILT WRVM
Cl-Iil -TRUSTEE

Lj -oc-

A921

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007

Page 22 of 30

.rroays
Scott January

tAw

Schreiber

Esq

2003

Page

Corarn

any the

subsid1arie
fullest

or

any committees

or

entities

claiming

throuh

them

Dan

may have

against

to

ectem

aFproved

by thÆ BankruptcyCort

The
finalized

parties contemplate

that

the formal presented
to

agreement
the

reflecting

the Court

above
for

will

be

by

January
in

31 2003
before

and

will

be
to

Bankruptcy

approval

thereafter

but

any event

Plan

be

proposed

by the Trustee

on or before February 28

2003.

If the undertakings retaining
all

Bankruptcy
will

Court
void
all

fails

to

approve
parties

the

Settlement
to

Agreement
previous

all

of the

of the parties
claims

be
and

and

the

will

return
parties

their

positions

which

exist

Llefenses

thereto

The

will

oaly

be

legally

bound

upon

approval

of the fomal.agreement

by the

Bankruptcy

Court

iJi
Serely BRESSLER

ci
cc
Arlin

M. Adams Chapter
Crwley

1.LTrste.e

..

Mr

Daniel

TheTerms and

Conditions

above

are hereby

agreeti

to

DANIEL

CROWLEY

ARLTh

AD AMS CHAPTER

11

TRUSTEE

GJ
pHDATA1o6s

Shnadr

Harrsot

Sgat

tewi

CH-1

TRUSTEE

A922

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007

Page 23 of 30

I...

ii LI

CONFIDENTIAL

EMB

001697

CH-11

TRUSTEE

CrowIeyAdminOO6i9B

A923

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007

Page 24 of 30

cc

bO

C/D

4.

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ft

a_ CL

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r-

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ci

c1Q.UD.O
4.

OT
CONFIDENTIAL

..-

.-

EMB

001698

CH-l1

TRUSTEE

CrowleyAdmiflOO199

A924

Case 1:04-cv-01565-SLR

Document 125-13

Filed 04/17/2007

Page 25 of 30

riD

tJD

bO

Ct

oc
CID

bObi
Ct

he.
Jil

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