Pg 1 of 33 TOGUT, SEGAL & SEGAL LLP One Penn Plaza Suite 3335 New York, New York 10119 (212) 594-5000 Frank A. Oswald Brian F. Moore Counsel to the Debtors and Debtors in Possession UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ---------------------------------------------------------------x : In re: : Chapter 11 : TOISA LIMITED, et al., : Case No. 17-10184 (SCC) : Debtors.1 : (Jointly Administered) : ---------------------------------------------------------------x CERTIFICATE OF NO OBJECTION TO NOTICE OF: (I) SELECTION OF SUCCESSFUL BID AND PROPOSED SALE OF TOISA INVINCIBLE; (II) FILING OF DECLARATION OF JONATHAN MILNE FAWTHROP IN SUPPORT OF THE SALE; (III) FILING OF DECLARATION OF JONATHAN MITCHELL IN SUPPORT OF THE SALE; AND (IV) FILING OF PROPOSED SALE ORDER TO THE HONORABLE SHELLEY C. CHAPMAN, UNITED STATES BANKRUPTCY JUDGE: The undersigned counsel respectfully states: 1. On November 19, 2018, Toisa Limited and certain of its affiliates, the above-captioned debtors and debtors in possession (collectively, the Debtors ), by their undersigned counsel, filed and served the Notice of: (I) Selection of Successful Bid and Proposed Sale of Toisa Invincible; (II) Filing of Declaration of Jonathan Milne Fawthrop in 1 The Debtors are as follows: Trade Prosperity, Inc.; Toisa Limited; United Courage, Inc.; Trade Vision, Inc.; United Journey, Inc.; United Kalavryta, Inc.; Trade Sky, Inc.; Trade Industrial Development Corporation; United Honor, Inc.; Trade Will, Inc.; United Leadership Inc.; United Seas, Inc.; United Dynamic, Inc.; United Emblem, Inc.; United Ideal Inc.; Trade Unity, Inc.; Trade Quest, Inc.; Trade Spirit, Inc.; Trade Resource, Inc.; United Ambassador, Inc.; Edgewater Offshore Shipping, Ltd.; United Banner, Inc.; Toisa Horizon, Inc.; and Trade and Transport Inc.
Pg 2 of 33 Support of the Sale; (III) Filing of Declaration of Jonathan Mitchell in Support of the Sale; and (IV) Filing of Proposed Sale Order [Docket No. 913] (the Sale Notice ). 2 2. The Sale Notice provided that responses, if any, as it relates to Court consideration and approval of the Sale Notice, were to be filed and served so as to be actually received no later than November 26, 2018 at 4:00 p.m. (prevailing Eastern Time). 3. The undersigned counsel hereby certifies that, as of the date hereof, no objection to the Sale Notice has been received. The undersigned counsel further certifies that he has reviewed the docket in this case and no answer, objection, or other response to the Sale Notice appears thereon. 4. In accordance with Rule 9075-2 of the Local Bankruptcy Rules for the Southern District of New York, this certificate is being filed at least forty-eight (48) hours after expiration of the deadline for parties to file and serve any answer, objection, or response to the Sale Notice. [Concluded on Following Page] 2 Capitalized terms used but not defined herein shall have the meaning ascribed to such term in the Sale Notice. 2
Pg 3 of 33 5. Due to the foregoing, it is respectfully requested that the Court enter the proposed order approving the Sale Notice, a copy of which is attached hereto as Exhibit A, at its earliest convenience. Dated: November 28, 2018 New York, New York TOGUT, SEGAL & SEGAL LLP Counsel for the Debtors and Debtors in Possession By: /s/ Brian F. Moore FRANK A. OSWALD BRIAN F. MOORE LAUREN L. PEACOCK One Penn Plaza, Suite 3335 New York, New York 10119 (212) 594-5000 3
Pg 4 of 33 EXHIBIT A PROPOSED ORDER
Pg 5 of 33 UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x : In re: : Chapter 11 : TOISA LIMITED, et al., : Case No. 17-10184 (SCC) : Debtors. 1 : (Jointly Administered) : - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x ORDER AUTHORIZING AND APPROVING SALE OF TOISA INVINCIBLE FREE AND CLEAR OF LIENS, CLAIMS, AND ENCUMBRANCES IN ACCORDANCE WITH THE SALE PROCEDURES ORDER Upon the Notice of: (I) Selection of Successful Bid and Proposed Sale of Toisa Invincible; (II) Filing of Declaration of Jonathan Milne Fawthrop in Support of the Sale; (III) Filing of Declaration of Jonathan Mitchell in Support of the Sale; and (IV) Filing of Proposed Sale Order providing notice of the Order Authorizing and Approving the Sale of Toisa Invincible Free and Clear of Liens, Claims, and Encumbrances in Accordance with the Sale Procedures Order (the Sale Notice ) and the adjoining Declaration of Jonathan Milne Fawthrop attached to the Sale Notice as Exhibit B (the Fawthrop Declaration ) 2 and the Declaration of Jonathan Mitchell attached to the Sale Notice as Exhibit C (the Mitchell Declaration and, together with the Fawthrop Declaration, the Declarations ) in support of entry of an order (this Order ) authorizing the sale (the Sale ) of Toisa Invincible (the Vessel ) to DP ACQUISITIONS INC. or its designee (the Buyer ), 1 The Debtors in these chapter 11 cases are as follows: Trade Prosperity, Inc.; Toisa Limited; United Courage, Inc.; Trade Vision, Inc.; United Journey, Inc.; United Kalavryta, Inc.; Trade Sky, Inc.; Trade Industrial Development Corporation; United Honor, Inc.; Trade Will, Inc.; United Leadership Inc.; United Seas, Inc.; United Dynamic, Inc.; United Emblem, Inc.; United Ideal Inc.; Trade Unity, Inc.; Trade Quest, Inc.; Trade Spirit, Inc.; Trade Resource, Inc.; United Ambassador, Inc.; Edgewater Offshore Shipping, Ltd.; United Banner, Inc.; Toisa Horizon, Inc.; and Trade and Transport Inc. 2 Capitalized terms not otherwise defined herein have the meanings ascribed to them in the applicable Declaration.
Pg 6 of 33 pursuant to this Court s Order Approving (A) Procedures Regarding the Solicitation of Offers in Connection with the Sale of Certain of the Debtors Offshore Vessels, Subject to Bankruptcy Court Approval, (B) the Form of Notices Regarding the Sales and (C) the Form of Purchase and Sale Agreement [Docket No. 671] (the Offshore Sale Procedures Order ); and sufficient notice of the Sale having been provided to all parties with an interest in the Vessel in accordance with the Offshore Sale Procedures Order; and the Court having reviewed and considered the Declarations, the purchase and sale agreement attached to this Order as Exhibit 1 (the Purchase Agreement ), and the addendum to the Purchase Agreement attached to this Order as Exhibit 2 (the Addendum ); and it appearing that the Sale is in the best interests of the Debtors, their estates, their creditors, their stakeholders, and other parties in interest; and after due deliberation thereon; and sufficient cause appearing therefor; IT IS HEREBY FOUND AND DETERMINED THAT: A. This Court has jurisdiction over the Sale pursuant to 28 U.S.C. 157 and 1334. This is a core proceeding under 28 U.S.C. 157(b). Venue of these cases and the Sale in this district is proper under 28 U.S.C. 1408 and 1409. B. The legal predicates for the relief sought in the Sale Notice and the Declarations are sections 105(a), 363(b), 363(f), 363(m), and 541(a) of title 11 of the United States Code (the Bankruptcy Code ), Rules 2002, 6004, and 9006 of the Federal Rules of Bankruptcy Procedure (the Bankruptcy Rules ), Rule 6004-1 of the Local Bankruptcy Rules for the Southern District of New York (the Local Rules ), and the Amended Guidelines for the Conduct of Asset Sales for the United States Bankruptcy Court for the Southern District of New York (the Sale Guidelines ). C. This Order constitutes a final order within the meaning of 28 U.S.C. 158(a). Notwithstanding Bankruptcy Rules 6004(h), 6006(d), and 7062, and to the 2
Pg 7 of 33 extent necessary under Bankruptcy Rule 9014 and Rule 54(b) of the Federal Rules of Civil Procedure, as made applicable by Bankruptcy Rule 7054, this Court expressly finds that there is no just reason for delay in the implementation of this Order and expressly directs entry of this Order as set forth herein. D. As evidenced by the Fawthrop Declaration (i) proper, timely, adequate, and sufficient notice of the Sale has been provided in accordance with the Offshore Sale Procedures Order to each party entitled to such notice, including but not limited to all persons and entities known to have asserted a lien, claim, encumbrance, or other interest (collectively, Liens ) on the applicable Vessel, (ii) such notice was good, sufficient, and appropriate under the particular circumstances, (iii) such notice provided a fair and reasonable opportunity to object or be heard with respect to the Sale to all parties entitled to notice, and (iv) no other or further notice of the Sale is or shall be required. E. All interested persons and entities have been afforded a reasonable opportunity to object and to be heard with respect to the Sale. F. The Debtors have articulated good and sufficient reasons for this Court to grant the relief requested. The disclosures made by the Debtors in the Declarations and in the motion for entry of the Offshore Sale Procedures Order and at the hearing to consider entry of the Offshore Sale Procedures Order were good, complete, and adequate. G. The Debtors have demonstrated both (a) good, sufficient, and sound business purposes and justifications for approving the Purchase Agreement and the Addendum and (b) compelling circumstances for the Sale outside the ordinary course of business, pursuant to section 363(b) of the Bankruptcy Code before, and outside of, a plan of reorganization, in that, among other things, the immediate 3
Pg 8 of 33 consummation of the Sale to the Buyer is necessary and appropriate to maximize the value of the Debtors estates, and the Sale will provide the means for the Debtors to maximize distributions to creditors. H. The Debtors have shown that the Sale of the Vessel to the Buyer is a reasonable exercise of the Debtors business judgment and is in the best interests of the Debtors estates, their creditors, their stakeholders, and other parties in interest. Sound business reasons exist for the Sale. I. As set forth in the Declarations, the Debtors and their advisors marketed the Vessel to secure the highest and best offer. J. The Buyer is a good faith purchaser for value and, as such, is entitled to all of the protections afforded under section 363(m) of the Bankruptcy Code and has otherwise acted in good faith in connection with the Sale. Specifically, (i) the Buyer is not an insider of the Debtors, as that term is defined in the Bankruptcy Code; (ii) the Sale was negotiated at arm s-length and in good faith; (iii) the Buyer did not in any way induce or cause the filing of the Chapter 11 Cases; (iv) the consideration provided to the Debtors pursuant to the Sale is fair and reasonable; (v) the Sale is not the result of fraud or collusion; (vi) the Sale constitutes the highest or best offer made for the Vessel; and (vii) the Buyer is not a successor to the Debtors. Neither the Debtors nor the Buyer has engaged in any conduct that would cause or permit the Sale to be avoided or result in the imposition of any costs or damages under section 363(n) of the Bankruptcy Code. K. No party has objected to the Sale, the Purchase Agreement or the Addendum on the grounds of fraud or collusion. L. The terms and conditions of the Purchase Agreement and the Addendum are fair and reasonable. The consideration provided by the Buyer for the 4
Pg 9 of 33 Vessel pursuant to the Addendum (i) was negotiated at arm s length and is fair and reasonable, (ii) is the highest or best offer for the Vessel, (iii) will provide a greater recovery for the Debtors creditors than would be provided by any other practical available alternative, and (iv) constitutes reasonably equivalent value and fair consideration under the Bankruptcy Code and applicable non-bankruptcy law. M. Toisa Limited is the sole and lawful owner of the Vessel. The transfer of the Vessel by the Debtors to the Buyer will be a legal, valid, and effective transfer of the Vessel, and will vest the Buyer with all right, title, and interest of the Debtors in and to the Vessel free and clear of all Liens, and all Liens on or against the Vessel and related assets being sold shall attach to the consideration received by the Debtors under the Purchase Agreement and the Addendum, with the same force, validity, priority, and effect as they currently exist. After the closing of the Sale under the Purchase Agreement and the Addendum, the Buyer shall have no liability for any claims asserted against or liabilities of the Debtors or their estates, except as may be provided for herein. IT IS THEREFORE ORDERED, ADJUDGED, AND DECREED THAT: 1. The relief sought by the Debtors in the portion of their motion for entry of the Offshore Sale Procedures Order approving the sale of the Vessel is hereby granted as set forth herein. All objections to entry of this Order that have not been withdrawn, waived, or settled by announcement to the Court during any hearing or stipulation filed with the Court, including, without limitation, any and all reservations of rights included in such objections or otherwise, are hereby denied and overruled on the merits with prejudice. Entities with an interest in the Vessel and related assets being sold pursuant to the Purchase Agreement and the Addendum that did not object or 5
Pg 10 of 33 withdrew their objections to the entry of this Order are deemed to have consented to the Sale pursuant to section 363(f)(2) of the Bankruptcy Code. 2. This Order shall be binding in all respects upon all creditors of and holders of equity interests in the Debtors (whether known or unknown), agents, trustee and collateral trustees, holders of Liens on the Vessel, or any portion thereof, all counterparties to contracts with the Debtors (whether or not assigned), all successors and assigns of the Debtors, and any subsequent trustees appointed in these bankruptcy cases or upon a conversion of these bankruptcy cases to one or more cases under chapter 7 of the Bankruptcy Code and shall not be subject to rejection or unwinding. Nothing in any chapter 11 plan confirmed in these bankruptcy cases, the order confirming any such chapter 11 plan, any order approving the wind down or dismissal of these bankruptcy cases, or any order entered upon the conversion of these bankruptcy cases to one or more cases under chapter 7 of the Bankruptcy Code or otherwise shall conflict with or derogate from the provisions of the Purchase Agreement, the Addendum, or this Order. 3. The findings of fact set forth above and conclusions of law set forth herein constitute this Court s findings of fact and conclusions of law pursuant to Bankruptcy Rule 7052, made applicable to this case pursuant to Bankruptcy Rule 9014. To the extent any finding of fact later shall be determined to be a conclusion of law, it shall be so deemed, and to the extent any conclusion of law later shall be determined to be a finding of fact, it shall be so deemed. 4. Except as otherwise provided herein, all parties are enjoined from taking any action against the Buyer or any other purchaser of the Vessel, their affiliates or any agent of the foregoing to recover any claim which such person or entity has solely against the Debtors or their estates. 6
Pg 11 of 33 5. Pursuant to sections 363(b) and 363(f) of the Bankruptcy Code, the Debtors are authorized, empowered, and directed to take any and all actions necessary or appropriate to transfer the Vessel to the Buyer pursuant to the terms and conditions set forth in the Purchase Agreement and the Addendum. The Sale, including all of the terms and conditions and transactions contemplated by the Purchase Agreement, the Addendum, and all other ancillary documents, is hereby approved, and the Debtors are authorized and directed to take all actions necessary to consummate the Sale and to perform under the Purchase Agreement and the Addendum; provided, however, that if there is any conflict between the terms of the Purchase Agreement, the Addendum, and this Order, this Order shall govern. 6. Upon sale and transfer of the Vessel, all of the Debtors right, title, and interest in the Vessel shall be immediately vested in the Buyer pursuant to sections 105(a), 363(b), and 363(f) of the Bankruptcy Code free and clear of any and all Liens, and all Liens on or against the Vessel and related assets being sold shall attach to the consideration received by the Debtors under the Purchase Agreement and the Addendum, with the same force, validity, priority, and effect as they currently exist. Such Sale shall constitute a legal, valid, binding, and effective transfer of such Vessel and shall vest the Buyer with good and marketable title to the Vessel. 7. The Debtors are authorized and directed to execute and deliver, and empowered to perform under, consummate, and implement the Purchase Agreement and the Addendum, together with all additional instruments and documents that may be reasonably necessary, convenient, or desirable to implement the Purchase Agreement and the Addendum and consummate the Sale pursuant thereto and effectuate the provisions of this Order and the transactions approved hereby, and to take all other actions as may be necessary for the purpose of assigning, transferring, 7
Pg 12 of 33 granting, conveying, and conferring to the Buyer, the Vessel, as may be necessary or appropriate to the performance of the obligations as contemplated by the Purchase Agreement, the Addendum, and this Order. 8. The Buyer is a good faith buyer within the meaning of section 363(m) of the Bankruptcy Code and, as such, is entitled to the full protections of section 363(m) of the Bankruptcy Code. The Sale was undertaken by the Buyer without collusion and in good faith, as that term is used in section 363(m) of the Bankruptcy Code and the Buyer is entitled to the full protections under section 363(m) of the Bankruptcy Code. Accordingly, the reversal or modification on appeal of the authorization provided herein to consummate the Sale shall not affect the validity of the Sale, unless such authorization and consummation of the Sale is duly and properly stayed pending such appeal. 9. The cash proceeds generated from the Sale shall be applied first to satisfy payment of the Broker Commission to Clarkson in the amount of $5,000. The remaining cash proceeds (including any cash deposit made by the Buyer) generated from the Sale shall be (a) deposited directly into the DNB Bank ASA ( DNB ) operated vessel account with account number xxxx9006 (the Vessel Account ) and (b) used solely in accordance with the Informal Committee Cash Collateral Order [Docket No. 246]; provided, however, that notwithstanding the terms of the Informal Committee Cash Collateral Order, DNB, as agent under the DNB Tanker Credit Facility (as defined in the Declaration of Robert Hennebry Pursuant to Local Bankruptcy Rule 1007-2 and in Support of the Debtors Chapter 11 Petitions and First Day Pleadings [Docket No. 3]) shall apply such cash proceeds and any other cash in the Vessel Account to permanently reduce any claims outstanding under the DNB Tanker Credit Facility (collectively, Existing DNB Tanker Credit Facility Claims ) in accordance with a closing 8
Pg 13 of 33 memorandum (the Closing Memorandum ) to be delivered by the Debtors to DNB as soon as reasonably practicable prior to the expected date of the closing of the Sale (the Closing Date ), but in no event later than five (5) business days prior to the expected Closing Date, and agreed between DNB and the Debtors (in consultation with the Official Committee of Unsecured Creditors and the Informal Committee of Secured Lenders), which memorandum shall (if applicable), unless otherwise agreed to, provide for the payment of, or establish a reserve for, among other things: any amounts that may be payable under a Carve-Out under the Informal Committee Cash Collateral Order. In the event that no such agreement regarding the Closing Memorandum is reached prior to the Closing Date, only the portion of the cash proceeds relating to disputed payments or reserves (the Disputed Amounts ) shall continue to be held in the Vessel Account in accordance with the Informal Committee Cash Collateral Order, and upon the closing of the Sale the remainder of the cash proceeds and any other cash in the Vessel Account for DNB shall be applied to permanently reduce Existing DNB Tanker Credit Facility Claims. If the Debtors and DNB are unable to resolve their dispute with respect to the payment of, or reserve for, the Disputed Amounts within fourteen (14) days from the Closing Date, the Debtors shall file with this Court and serve upon DNB a motion, on at least ten (10) days prior written notice to DNB of any hearing on such motion, requesting authority to pay or reserve for such Disputed Amounts from the cash proceeds of the Sale, and no disbursements of the Disputed Amounts from the Vessel Account shall be made without further order of this Court. DNB, as agent under the DNB Tanker Credit Facility, reserves all of its rights to object to any such motion. If the Debtors do not file a motion within fourteen (14) days from the Closing Date, the Disputed Amounts shall be applied by DNB, as agent under the DNB Tanker Credit Facility, to permanently reduce the outstanding amount of the 9
Pg 14 of 33 Existing DNB Tanker Credit Facility Claims. The Debtors shall work in good faith with their advisors to timely prepare the Closing Memorandum prior to the Closing Date. 10. Except as otherwise set forth in this Order, nothing in the Notice, the Purchase Agreement, the Addendum, or the Declarations shall be deemed to constitute the postpetition assumption of any agreement under Bankruptcy Code section 365. 11. Notwithstanding Bankruptcy Rules 6004(h), 6006(d), 7062, or 9014 or any other Bankruptcy Rule, Local Rule, or Rule 62(a) of the Federal Rules of Civil Procedure, this Order shall be immediately effective and enforceable upon its entry and there shall be no stay of execution of this Order. 12. The Court retains exclusive jurisdiction with respect to all matters arising from or related to the implementation of this Order. Dated: New York, New York, 2018 HONORABLE SHELLEY C. CHAPMAN UNITED STATES BANKRUPTCY JUDGE 10
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