Case 16-32689 Document 10 Filed in TXSB on 05/29/16 Page 1 of 11 IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF TEXAS In re: ) Chapter 11 ) LINC USA GP, et al. 1 ) Case No. 16-32689 (DRJ) ) Debtors. ) (Joint Administration Requested) EMERGENCY APPLICATION FOR ENTRY OF ORDER AUTHORIZING THE RETENTION AND APPOINTMENT OF KURTZMAN CARSON CONSULTANTS LLC AS NOTICE, CLAIMS AND BALLOTING AGENT Linc USA GP, et al., the above-captioned debtors and debtors in possession (collectively, the Debtors ) hereby submit this application (the Application ) for entry of an order substantially in the form filed herewith, authorizing the Debtors employment and retention of Kurtzman Carson Consultants LLC ( KCC ) as notice, claims and balloting agent ( Claims and Noticing Agent ) in connection with the Debtors chapter 11 cases. In support of its Application, the Debtors submit the declaration of Evan Gershbein, Senior Vice President of Corporate Restructuring (the Gershbein Declaration ), which is attached hereto as Exhibit A and incorporated herein by reference. In further support of this Motion, the Debtors respectfully represent as follows: I. JURISDICTION AND VENUE 1. The United States Bankruptcy Court for the Southern District of Texas (the Court ) has jurisdiction over this matter pursuant to 28 U.S.C. 157 and 1334. This matter is a core proceeding within the meaning of 28 U.S.C. 157(b)(2). 2. Venue in this Court is proper pursuant to 28 U.S.C. 1408 and 1409. 1 The Debtors in these chapter cases, along with the last four digits of each Debtor s federal tax identification number, are: Linc Energy Finance (USA), Inc. (6684); Linc USA GP (5234); Linc Energy Resources, Inc. (9613); Linc Gulf Coast Petroleum, Inc. (6790); Linc Energy Petroleum (Louisiana), LLC (1074); Linc Alaska Resources, LLC (2362); Paen Insula Holdings, LLC (1681); Linc Energy Petroleum (Wyoming), Inc. (9859); Diasu Holdings, LLC (9626); Diasu Oil & Gas Company, Inc. (8926); and Linc Energy Operations, Inc. (5806). 5158608
Case 16-32689 Document 10 Filed in TXSB on 05/29/16 Page 2 of 11 3. The statutory basis for the relief requested herein is 28 U.S.C. 156(c). II. BACKGROUND 4. Together, the Debtors operate an oil and gas exploration and production business with a primary focus on the Texas Gulf Coast. Each of the Debtors is a direct or indirect subsidiary of Linc USA GP. Each of the Debtors is based in Houston, Texas. The Debtors properties are operated by Debtor Linc Energy Operations, Inc. ( LEO ). 5. On May 29, 2016 (the Petition Date ), each of the Debtors filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code. 6. A full description of the Debtors' business, corporate structure, prepetition indebtedness, and events leading to these chapter 11 cases is set forth in the Declaration of Jude Rolfes, Vice President of Corporate Development for the Debtors, in Support of Chapter 11 Petitions and First Day Pleadings (the First Day Declaration ), filed concurrently herewith and incorporated by reference. 7. The Debtors are operating their business and managing their properties as debtors in possession pursuant to 1107(a) and 1108 of the Bankruptcy Code. III. RELIEF REQUESTED 8. By this Application, the Debtors seek entry of an order, substantially in the form filed herewith, authorizing them to retain and employ KCC as their Claims and Noticing Agent in the Debtors chapter 11 cases effective nunc pro tunc to the Petition Date, to, among other things, (i) serve as the noticing agent to mail notices to the estates creditors and parties in interest; (ii) provide computerized claims, objection, soliciting, and balloting database services; and (iii) provide expertise, consultation, and assistance in claim and ballot processing and other administrative services with respect to the Debtors bankruptcy cases, pursuant to the provisions of the Services Agreement. The Debtors selection of KCC to act as the Claims and Noticing 5158608-2-
Case 16-32689 Document 10 Filed in TXSB on 05/29/16 Page 3 of 11 Agent is appropriate under the circumstances and in the best interest of the estates. Moreover, the Debtors submit, based on all engagement proposals obtained and reviewed, that KCC s rates are competitive and reasonable given KCC s quality of services and expertise. The terms of KCC s retention are set forth in the services agreement (the Services Agreement ) attached hereto as Exhibit B. 9. Although the Debtors have not yet filed their schedules of assets and liabilities, they anticipate that there will be thousands of persons and entities to be noticed and that many of these parties will file claims. In view of the number of anticipated claimants and the complexity of the Debtors businesses, the Debtors submit that the appointment of a claims and noticing agent will provide the most effective and efficient means of, and relieve the Debtors and/or the Clerk s Office of the administrative burden of noticing, administering claims, and soliciting and tabulating votes, and is in the best interests of both the Debtors estates and their creditors. IV. KCC S QUALIFICATIONS 10. The Debtors have numerous potential creditors and parties in interest in these chapter 11 cases. Although the office of the Clerk of the United States Court (the Clerk s Office ) ordinarily would serve notices on the Debtors creditors and other parties in interest and administer claims against the Debtors, the Clerk s Office may not have the resources to undertake such tasks, especially in light of the sheer magnitude of the Debtors creditor body and the tight timelines that frequently arise in chapter 11 cases. 11. Accordingly, the Debtors propose to engage KCC to act as the Debtors Claims and Noticing Agent. This retention is the most effective and efficient manner of noticing the numerous creditors and parties in interest of the filing of these chapter 11 cases and other developments related thereto. In that capacity, KCC will transmit, receive, docket, and maintain proofs of claim filed in connection with these chapter 11 cases. 5158608-3-
Case 16-32689 Document 10 Filed in TXSB on 05/29/16 Page 4 of 11 12. KCC is a bankruptcy administrator that specializes in providing comprehensive chapter 11 administrative services including noticing, claims processing, balloting, and other related services critical to the effective administration of chapter 11 cases. Indeed, KCC has developed efficient and cost-effective methods to properly handle the voluminous mailings associated with the noticing, claims processing, and balloting portions of chapter 11 cases to ensure the orderly and fair treatment of creditors, equity security holders, and all parties in interest. Further, KCC will work with the Clerk s Office to ensure that such methodology conforms with all of the Bankruptcy Court s procedures, the Bankruptcy local rules for the Southern District of Texas (the Local Rules ), and the provisions of any orders entered by the Bankruptcy Court. 13. KCC has substantial experience in matters of this size and complexity and has acted as the official notice, claims, and balloting agent in many large bankruptcy cases in this district and other districts nationwide. See, e.g., In re CHC Group Ltd., Case No. 16-31854 (Bankr. N.D. Tex. May 5, 2016); In re Midstates Petroleum Company, Inc., Case No. 16-32237 (Bankr. S.D. Tex. Apr. 30, 2016); Sherwin Alumina Company, LLC, et al., Case No. 16-20012 (Bankr. S.D. Tex. Jan. 11, 2016); In re BPZ Resources, Inc., Case No. 15-60016 (Bankr. S.D. Tex. Mar. 26, 2015); In re ATP Oil & Gas Corp., Case No. 12-36187 (Bankr. S.D. Tex. Aug. 17, 2012); In re Reddy Ice Holdings, Inc., Case No. 12-32349 (N.D. Tex. April 12, 2012); In re Seahawk Drilling, Inc., Case No. 11-20089 (Bankr. S.D. Tex. Feb. 11, 2011); In re Peabody Energy Corporation, et al., Case No. 16-42529 (Bankr. E.D. Mo. Apr. 13, 2016); Vestis Retail Group, LLC, et al., Case No. 16-10971 (Bankr. D. Del. Apr. 18, 2016); American Hospice Management Holdings, LLC, et al., Case No. 16-10670 (Bankr. D. Del. Mar. 20, 2016); Sports Authority Holdings, Inc., et al., Case No. 16-10527 (Bankr. D. Del. Mar. 2, 2016); Paragon 5158608-4-
Case 16-32689 Document 10 Filed in TXSB on 05/29/16 Page 5 of 11 Offshore plc, et al., Case No. 16-10386 (Bankr. D. Del. Feb. 14, 2016); Hancock Fabrics, Inc., et al., Case No. 16-10296 (Bankr. D. Del. Feb. 2, 2016). V. SERVICES TO BE PROVIDED 14. Specifically, the Debtors seek to engage KCC to provide certain noticing, claims processing, and balloting administration services including, without limitation: a. Assist the Debtors with the preparation and distribution of all required notices in these chapter 11 cases, including (i) notice of any claims bar date, (ii) notice of any proposed sale of the Debtor s assets, (iii) notices of objections to claims and objections to transfers of claim, (iv) notices of any hearings on a disclosure statement and confirmation of any plan or plans of reorganization, including under Bankruptcy Rule 3017(d), (v) notice of the effective date of any plan, and (vi) all other notices, orders, pleadings, publications, and other documents as the Debtors, Court, or Clerk may deem necessary or appropriate for an orderly administration of these chapter 11 cases, including through email or other electronic means; b. Maintain an official copy of the Debtors schedules of assets and liabilities and statement of financial affairs (collectively, the Schedules ), listing the Debtors known creditors and amounts owed thereto; c. Maintain (i) a list of all potential creditors, equity holders, and other parties-in-interest and (ii) a core mailing list consisting of all parties described in Bankrutpcy Rule 2002(i), (j) and (k) and those parties that have filed a notice of appearance pursuant to Bankruptcy Rule 9100; d. Update and make said lists available upon request by a party-in-interest or the Clerk; e. Furnish notice to all potential creditors of the last date for filing proofs of claim and a form for filing a proof of claim, after such notice and form are approved by the Court, and notify said potential creditors of the existence, amount and classification of their respective claims as set forth in the Schedules, which may be effected by inclusion of such information (or the lack thereof, in cases where the Schedules indicate no debt due to the subject party) on a customized proof of claim form provided to potential creditors; f. Maintain a post office box or address for the purpose of receiving claims and returned mail, and process all mail received; g. For all notices, motions, orders or other pleadings or documents served, prepare and file or cause to be filed with the Clerk an affidavit or 5158608-5-
Case 16-32689 Document 10 Filed in TXSB on 05/29/16 Page 6 of 11 certificate of service no more frequently than every seven (7) days that includes (i) either a copy of each notice served for the preceding seven (7) days or the docket number(s) and title(s) of the pleading(s) served during such period, (ii) a list of persons to whom it was mailed (in alphabetical order) with their addresses, (iii) the manner of service, and (iv) the date served; h. Receive (including through the electronic filing interface available on KCC s website) and process all proofs of claim received, check said processing for accuracy, and forward copies of all claims received that were not filed with the Clerk of the Court at least weekly; for the avoidance of doubt, claims shall be filed with the Clerk of the Court and the Clerk of the Court shall continue to maintain its own claims register. i. Monitor the Court s docket for all notices of appearance, address change, and claims-related pleadings and orders filed and make necessary notations on and/or changes to any service or mailing lists, including to identify and eliminate duplicative names and addresses from such lists; j. Identify and correct any incomplete or incorrect addresses in any mailing or service lists; k. Assist in the dissemination of information to the public and respond to requests for administrative information regarding these chapter 11 cases as directed by the Debtors or the Court, including through the use of a case website and/or call center; l. Monitor the Court s docket in these chapter 11 cases and, when filings are made in error or containing errors, alert the filing party of such error and work with them to correct any such error; m. Comply with applicable federal, state, municipal and local statutes, ordinances, rules, regulations, orders and other requirements; n. If any of these chapter 11 cases are converted to cases under chapter 7 of the Bankruptcy Code, contact the Clerk s office within three (3) days of notice to KCC of entry of the order converting the case(s); o. Thirty (30) days prior to the close of these chapter 11 cases, to the extent practicable, request that the Debtors submit to the Court a proposed order dismissing KCC as Claims and Noticing Agent and terminating its services in such capacity upon completion of its duties and responsibilities and upon the closing of these chapter 11 cases; p. Assist the Debtors with plan solicitation services including: (i) balloting, (ii) distribution of applicable solicitation materials, (iii) tabulation and 5158608-6-
Case 16-32689 Document 10 Filed in TXSB on 05/29/16 Page 7 of 11 calculation of votes, (iv) determining with respect to each ballot cast, its timeliness and its compliance with the Bankruptcy Code, Bankruptcy Rules, and procedures ordered by this Court, (v) preparing an official ballot certification and testifying, if necessary, in support of the ballot tabulation results, and (vi) in connection with the foregoing services, process requests for documents from parties in interest, including, if applicable, brokerage firms, bank back-offices, and institutional holders; q. Assist with the preparation of the Debtors schedules of assets and liabilities and statements of financial affairs and gather data in conjunction therewith; r. Provide a confidential data room, if requested; s. Manage and coordinate any distributions pursuant to a chapter 11 plan; and t. Provide such other processing, solicitation, balloting, and other administrative services described in the Services Agreement that may be requested from time to time by the Debtors, the Court or the Clerk s Office. 15. For the avoidance of doubt, KCC shall not act as the agent of the Clerk of the Court. The Clerk of the Court shall maintain its own claims register, which shall be the official claims register. Parties filing proofs of claim or interest shall be permitted to only file claims with the Clerk of the Court. VI. PROFESSIONAL COMPENSATION 16. The fees to be charged by KCC in connection with these chapter 11 cases are set forth in the Services Agreement. The Debtors propose that the cost of KCC s services be paid from the Debtors estates as provided by 28 U.S.C. 156(c) and 11 U.S.C. 503(b)(1)(A). The Debtors respectfully submit that KCC s rates for its services in connection with the notice, claims processing, and balloting services are competitive and comparable to the rates charged by their competitors for similar services. 17. Furthermore, the Debtors respectfully submit that the fees and expenses incurred by KCC are administrative in nature and, therefore, should not be subject to the standard fee 5158608-7-
Case 16-32689 Document 10 Filed in TXSB on 05/29/16 Page 8 of 11 application procedures for professionals. Specifically, the Debtors request authorization to compensate KCC in accordance with the terms and conditions set forth in the Services Agreement, upon KCC s submission to the Debtors of invoices summarizing in reasonable detail the services rendered and expenses incurred in connection with services provided by KCC to the Debtors. VII. KCC S DISINTERESTEDNESS 18. Although the Debtors do not propose to retain KCC under 327 of the Bankruptcy Code, to the best of KCC s knowledge, and except as set forth in the attached Gershbein Declaration, KCC neither holds nor represents an interest materially adverse to the Debtors estate nor has a connection to the Debtors, their creditors, or any related parties with respect to any matter for which KCC will be employed. KCC may have relationships with certain of the Debtors creditors as vendors or in connection with cases in which KCC serves or has served in a neutral capacity as claims and noticing agent for another chapter 11 debtor. 19. To the best of the Debtors knowledge and except as disclosed in the Gershbein Declaration, KCC neither holds nor represents any interest materially adverse to the Debtors estates in connection with any matter on which it would be employed and that it is a disinterested person within the meaning of 101(14) of the Bankruptcy Code, as referred to in 327(a) of the Bankruptcy Code. 20. KCC represents, among other things, that: a. It will not consider itself employed by the United States government in connection with the Debtors cases and shall not seek any compensation from the United States government in its capacity as Claims Agent; b. By accepting employment in these bankruptcy cases, KCC waives any right to receive compensation from the United States government in its capacity as Claims Agent; 5158608-8-
Case 16-32689 Document 10 Filed in TXSB on 05/29/16 Page 9 of 11 c. In its capacity as Claims Agent, KCC will not be an agent of the United States and will not act on behalf of the United States; and d. KCC will not employ any past or present employees of the Debtors in connection with its work as Claims Agent. 21. Should KCC discover any new relevant facts or relationships bearing on the matters described herein during the period of its retention, KCC will use reasonable efforts to file promptly a supplemental declaration or affidavit. VIII. BASIS FOR RELIEF 22. Section 156(c) of title 28 of the United States Code, which governs the staffing and expenses of a bankruptcy court, authorizes the Bankruptcy Court to use facilities or services other than the Clerk s Office for administration of bankruptcy cases. It states: Any court may utilize facilities or services, either on or off the court s premises, which pertain to the provision of notices, dockets, calendars, and other administrative information to parties in cases filed under the provisions of title 11, United States Code, where the costs of such facilities or services are paid for out of the assets of the estate and are not charged to the United States. The utilization of such facilities or services shall be subject to such conditions and limitations as the pertinent circuit council may prescribe. 28 U.S.C. 156(c). 23. Accordingly, 28 U.S.C. 156(c) empowers the Bankruptcy Court to utilize outside agents and facilities for notice and claims purposes, provided the Debtors estates pay the cost of such services. Therefore, and for all of the foregoing reasons, the Debtors believe that the retention of KCC as their Claims Agent is in the best interests of the Debtors, their estates, and their creditors. Furthermore, the Debtors respectfully submit that the fees and expenses that would be incurred by KCC under the proposed engagement would be administrative in nature and, therefore, should not be subject to standard fee application procedures of professionals. 5158608-9-
Case 16-32689 Document 10 Filed in TXSB on 05/29/16 Page 10 of 11 24. Courts in this jurisdiction and other jurisdictions have approved similar relief in other chapter 11 cases. See, e.g., In re CHC Group Ltd., Case No. 16-31854 (Bankr. N.D. Tex. May 5, 2016); In re Midstates Petroleum Company, Inc., Case No. 16-32237 (Bankr. S.D. Tex. Apr. 30, 2016); Sherwin Alumina Company, LLC, et al., Case No. 16-20012 (Bankr. S.D. Tex. Jan. 11, 2016); In re BPZ Resources, Inc., Case No. 15-60016 (Bankr. S.D. Tex. Mar. 26, 2015); In re ATP Oil & Gas Corp., Case No. 12-36187 (Bankr. S.D. Tex. Aug. 17, 2012); In re Reddy Ice Holdings, Inc., Case No. 12-32349 (N.D. Tex. April 12, 2012); In re Seahawk Drilling, Inc., Case No. 11-20089 (Bankr. S.D. Tex. Feb. 11, 2011). IX. NOTICE 25. The Debtors will provide notice of this Application to: (a) the Office of the United States Trustee for the Southern District of Texas; (b) the entities listed on the Consolidated List of Creditors Holding the 30 Largest Unsecured Claims against the Debtors filed pursuant to Bankruptcy Rule 1007(d); (c) all known or alleged secured creditors; (d) the Office of the United States Attorney General for the State of Texas; (e) the Internal Revenue Service; and (f) any party who has requested notice pursuant to Bankruptcy Rule 2002. In light of the nature of the relief requested in this Application, the Debtors respectfully submit that no further notice is necessary. X. NO PRIOR REQUEST 26. No prior request for the relief sought in this Application has been made to this or any other court. 5158608-10-
Case 16-32689 Document 10 Filed in TXSB on 05/29/16 Page 11 of 11 XI. CONCLUSION WHEREFORE, the Debtors respectfully request that the Court enter an order, substantially in the form filed herewith, granting the relief requested in this Application, and such other and further relief as may be just and proper under the circumstances. Respectfully Submitted, BRACEWELL LLP By: /s/ Jason G. Cohen Jason G. Cohen Texas Bar No. 24050435 Jason.Cohen@bracewelllaw.com William A. (Trey) Wood III Texas Bar No. 21916050 Trey.Wood@bracewelllaw.com Chelsea R. Dal Corso Texas Bar No. 24092316 Chelsea.DalCorso@bracewelllaw.com 711 Louisiana, Suite 2300 Houston, Texas 77002 Telephone: (713) 223-2300 Facsimile: (713) 221-1212 PROPOSED COUNSEL FOR THE DEBTORS AND DEBTORS IN POSSESSION 5158608-11-
Case 16-32689 Document 10-1 Filed in TXSB on 05/29/16 Page 1 of 6 Exhibit A Gershbein Declaration 5158608
Case 16-32689 Document 10-1 Filed in TXSB on 05/29/16 Page 2 of 6 IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF TEXAS In re: ) Chapter 11 ) LINC USA GP, et al. 1 ) Case No. 16-32689 (DRJ) ) Debtors. ) (Joint Administration Requested) DECLARATION OF EVAN GERSHBEIN IN SUPPORT OF DEBTORS EMERGENCY APPLICATION FOR ENTRY OF ORDER AUTHORIZING THE RETENTION AND APPOINTMENT OF KURTZMAN CARSON CONSULTANTS LLC AS NOTICE, CLAIMS AND BALLOTING AGENT I, Evan Gershbein, state as follows: 1. I am Senior Vice President of Corporate Restructuring of Kurtzman Carson Consultants LLC ( KCC ), a company specializing in the administration of large bankruptcy cases. 2. I submit this Declaration in support of the application (the Application ) 2 of the Debtors for authorization pursuant to 28 U.S.C. 156(c) to employ and retain KCC as Claims Agent in connection with these chapter 11 cases. I. KCC S QUALIFICATIONS 3. KCC is a bankruptcy administrator that specializes in providing comprehensive chapter 11 administrative services including noticing, claims processing, balloting, and other related services critical to the effective administration of chapter 11 cases. Indeed, KCC has developed efficient and cost-effective methods to properly handle the voluminous mailings associated with the noticing, claims processing, and balloting portions of chapter 11 cases to ensure the orderly and fair treatment of creditors, equity security holders, and all parties in 1 The Debtors in these chapter cases, along with the last four digits of each Debtor s federal tax identification number, are: Linc Energy Finance (USA), Inc. (6684); Linc USA GP (5234); Linc Energy Resources, Inc. (9613); Linc Gulf Coast Petroleum, Inc. (6790); Linc Energy Petroleum (Louisiana), LLC (1074); Linc Alaska Resources, LLC (2362); Paen Insula Holdings, LLC (1681); Linc Energy Petroleum (Wyoming), Inc. (9859); Diasu Holdings, LLC (9626); Diasu Oil & Gas Company, Inc. (8926); and Linc Energy Operations, Inc. (5806). 2 All capitalized terms used but not otherwise defined herein shall have the meaning set forth in the Application. 5158608
Case 16-32689 Document 10-1 Filed in TXSB on 05/29/16 Page 3 of 6 interest. Further, KCC will work with the Clerk s Office to ensure that such methodology conforms with all of the Bankruptcy Court s procedures, the Bankruptcy local rules for the Southern District of Texas (the Local Rules ), and the provisions of any orders entered by the Bankruptcy Court. 4. KCC has substantial experience in matters of this size and complexity and has acted as the official notice, claims, and balloting agent in many large bankruptcy cases in this district and other districts nationwide. See, e.g., In re CHC Group Ltd., Case No. 16-31854 (Bankr. N.D. Tex. May 5, 2016); In re Midstates Petroleum Company, Inc., Case No. 16-32237 (Bankr. S.D. Tex. Apr. 30, 2016); Sherwin Alumina Company, LLC, et al., Case No. 16-20012 (Bankr. S.D. Tex. Jan. 11, 2016); In re BPZ Resources, Inc., Case No. 15-60016 (Bankr. S.D. Tex. Mar. 26, 2015); In re ATP Oil & Gas Corp., Case No. 12-36187 (Bankr. S.D. Tex. Aug. 17, 2012); In re Reddy Ice Holdings, Inc., Case No. 12-32349 (N.D. Tex. April 12, 2012); In re Seahawk Drilling, Inc., Case No. 11-20089 (Bankr. S.D. Tex. Feb. 11, 2011); In re Peabody Energy Corporation, et al., Case No. 16-42529 (Bankr. E.D. Mo. Apr. 13, 2016); Vestis Retail Group, LLC, et al., Case No. 16-10971 (Bankr. D. Del. Apr. 18, 2016); American Hospice Management Holdings, LLC, et al., Case No. 16-10670 (Bankr. D. Del. Mar. 20, 2016); Sports Authority Holdings, Inc., et al., Case No. 16-10527 (Bankr. D. Del. Mar. 2, 2016); Paragon Offshore plc, et al., Case No. 16-10386 (Bankr. D. Del. Feb. 14, 2016); Hancock Fabrics, Inc., et al., Case No. 16-10296 (Bankr. D. Del. Feb. 2, 2016). II. SERVICES AND COMPENSATION 5. The Debtors seek to engage KCC to provide certain noticing, claims processing and balloting administration services as set forth in the Application. 6. The Services Agreement sets forth the fees KCC charges for the services it will provide to the Debtors. The proposed compensation arrangement is consistent with, and 5158608-2-
Case 16-32689 Document 10-1 Filed in TXSB on 05/29/16 Page 4 of 6 typical of, arrangements of KCC and its competitor firms to provide claims and noticing agent services in chapter 11 cases. 7. KCC requests that the Debtors pay its fees and expenses in accordance with the terms of the Services Agreement. KCC will submit invoices summarizing, in reasonable detail, the services and expenses for which compensation is sought. III. KCC S DISINTERESTEDNESS 8. Although the Debtors do not propose to retain KCC under 327 of the Bankruptcy Code, KCC has nonetheless conducted a conflicts analysis and, to the best of its knowledge, KCC neither holds nor represents an interest materially adverse to the Debtors estates nor has a material connection to the Debtors, their creditors or their related parties with respect to any matter for which KCC will be employed. KCC may have relationships with certain of the Debtors creditors as vendors or in connection with cases in which KCC serves or has served in a neutral capacity as claims and noticing agent for another chapter 11 debtor or as a class action settlement administrator. To the best of my knowledge, such relationships are materially unrelated to these chapter 11 cases. 9. In addition, KCC personnel may have relationships with some of the Debtors creditors or other parties in interest. However, to the best of my knowledge, such relationships, to the extent they exist, are of a personal financial nature and completely unrelated to these chapter 11 cases. KCC has and will continue to represent clients in matters materially unrelated to these chapter 11 cases. In addition, KCC has had and will continue to have relationships in the ordinary course of its business with certain vendors, professionals and other parties in interest that may be involved in the Debtors cases in matters unrelated to this case. 10. KCC is an indirect subsidiary of Computershare Limited. Computershare Limited is a financial services and technologies provider for the global securities industry. Within the 5158608-3-
Case 16-32689 Document 10-1 Filed in TXSB on 05/29/16 Page 5 of 6 Computershare corporate structure, KCC operates as a separate, segregated business unit. As such, any relationships that Computershare Limited and its affiliates maintain do not create an interest of KCC that would be materially adverse to the Debtors estates or any class of creditors or equity security holders. 11. To the best of my knowledge and except as disclosed herein, KCC neither holds nor represents any interest materially adverse to the Debtors estates in connection with any matter on which it would be employed and that it is a disinterested person within the meaning of 101(14) of the Bankruptcy Code, as referred to in 327(a) of the Bankruptcy Code. KCC will supplement its disclosure to the Bankruptcy Court if any facts or circumstances are discovered that would require disclosure. 12. KCC represents, among other things, that: a. It will not consider itself employed by the United States government in connection with the Debtors cases and shall not seek any compensation from the United States government in its capacity as Claims Agent; b. By accepting employment in these bankruptcy cases, KCC waives any right to receive compensation from the United States government in its capacity as Claims Agent; c. In its capacity as Claims Agent, KCC will not be an agent of the United States and will not act on behalf of the United States; and d. KCC will not employ any past or present employees of the Debtors in connection with its work in its capacity as Claims Agent. 13. Should KCC discover any new relevant facts or relationships bearing on the matters described herein during the period of its retention, KCC will use reasonable efforts to file promptly a supplemental affidavit. 5158608-4-
Case 16-32689 Document 10-1 Filed in TXSB on 05/29/16 Page 6 of 6
Case 16-32689 Document 10-2 Filed in TXSB on 05/29/16 Page 1 of 9 Exhibit B Services Agreement 5158608
Case 16-32689 Document 10-2 Filed in TXSB on 05/29/16 Page 2 of 9
Case 16-32689 Document 10-2 Filed in TXSB on 05/29/16 Page 3 of 9
Case 16-32689 Document 10-2 Filed in TXSB on 05/29/16 Page 4 of 9
Case 16-32689 Document 10-2 Filed in TXSB on 05/29/16 Page 5 of 9
Case 16-32689 Document 10-2 Filed in TXSB on 05/29/16 Page 6 of 9
Case 16-32689 Document 10-2 Filed in TXSB on 05/29/16 Page 7 of 9
Case 16-32689 Document 10-2 Filed in TXSB on 05/29/16 Page 8 of 9
Case 16-32689 Document 10-2 Filed in TXSB on 05/29/16 Page 9 of 9
Case 16-32689 Document 10-3 Filed in TXSB on 05/29/16 Page 1 of 7 Proposed Order 5158608
Case 16-32689 Document 10-3 Filed in TXSB on 05/29/16 Page 2 of 7 IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF TEXAS In re: ) Chapter 11 ) LINC USA GP, et al. 1 ) Case No. 16-32689 (DRJ) ) Debtors. ) (Joint Administration Requested) ORDER AUTHORIZING THE RETENTION AND APPOINTMENT OF KURTZMAN CARSON CONSULTANTS LLC AS NOTICE, CLAIMS AND BALLOTING AGENT Upon the application (the Application ) 2 of the Debtors for entry of an order authorizing the employment of Kurtzman Carson Consultants LLC ( KCC ) as the Claims and Noticing Agent for the Debtors pursuant to 28 U.S.C. 156(c), all as more fully set forth in the Application; and the Court having jurisdiction to consider the Motion and the relief requested therein in accordance with 28 U.S.C. 157 and 1334; and consideration of the Motion and the relief requested therein being a core proceeding pursuant to 28 U.S.C. 157(b)(2); and venue being proper in this District pursuant to 28 U.S.C. 1408 and 1409; and due and proper notice of the Motion being adequate and appropriate under the particular circumstances; and a hearing having been held to consider the relief requested in the Motion (the Hearing ); and upon consideration of Gershbein Declaration, the record of the Hearing and all proceedings had before the Court; and the Court having found and determined that the relief sought in the Motion is in the best interests of the Debtors estates, their creditors and other parties in interest, and that the legal and factual bases set forth in the Motion establish just cause for the relief granted herein; and any objections to the requested relief having been 1 The Debtors in these chapter cases, along with the last four digits of each Debtor s federal tax identification number, are: Linc Energy Finance (USA), Inc. (6684); Linc USA GP (5234); Linc Energy Resources, Inc. (9613); Linc Gulf Coast Petroleum, Inc. (6790); Linc Energy Petroleum (Louisiana), LLC (1074); Linc Alaska Resources, LLC (2362); Paen Insula Holdings, LLC (1681); Linc Energy Petroleum (Wyoming), Inc. (9859); Diasu Holdings, LLC (9626); Diasu Oil & Gas Company, Inc. (8926); and Linc Energy Operations, Inc. (5806). 2 All capitalized terms used but not otherwise defined herein shall have the meaning set forth in the Application. 5158608
Case 16-32689 Document 10-3 Filed in TXSB on 05/29/16 Page 3 of 7 withdrawn or overruled on the merits; and after due deliberation and sufficient cause appearing therefor; IT IS HEREBY ORDERED THAT: 1. The Application is GRANTED as set forth herein. 2. Notwithstanding the terms of the Services Agreement attached to the Application, the Application is approved solely as set forth in this Order. 3. The Debtors are authorized to retain KCC as Claims and Noticing Agent effective nunc pro tunc to the Petition Date under the terms of the Services Agreement as set forth in this Order, and KCC is authorized and directed to perform all tasks described in the Application and the Services Agreement, except as otherwise provided in this Order. 4. Notwithstanding anything to the contrary in the Application or the Services Agreement, the Clerk of the Court shall maintain its own claims register, and creditors shall file claims with the Clerk pursuant to the procedures of the Clerk and any further procedures ordered by the Court. KCC shall forward to the Clerk any claims received by KCC that were not filed with the Clerk at least weekly. 5. KCC is authorized to take such other action to comply with all duties and services set forth in the Application. 6. Without further order of the Court, pursuant to section 503(b)(1)(A) of the Bankruptcy Code, KCC s fees and expenses shall be treated as administrative expenses of the Debtors estates and shall be paid by the Debtors in accordance with the terms of the Services Agreement upon receipt of each KCC invoice by the Debtors, unless KCC is advised, within ten days of receipt of the invoice, that the office of the United States Trustee for the Southern District of Texas, counsel for the Debtors, counsel for any official committee, if any, and any 5158608-2-
Case 16-32689 Document 10-3 Filed in TXSB on 05/29/16 Page 4 of 7 party-in-interest who specifically requests service of the monthly invoices, objects to the invoice, in which case the Debtors will schedule a hearing before the Court to consider the disputed invoice. In the event of a disputed invoice, the Debtors shall remit to KCC only the undisputed portion of the invoice and, if applicable, shall pay the remainder to KCC upon the resolution of the disputed portion, as mandated by the Court. If KCC s fees increase from the fees in the Services Agreement, KCC shall file an affidavit with the Court describing such increases. 7. KCC shall maintain records of all services showing dates, categories of services, fees charged and expenses incurred, and shall serve monthly invoices on the Debtors, the Office of the United States Trustee, counsel for the Debtors, counsel for any official committee monitoring the expenses of the Debtors, and any party in interest who specifically requests service of the monthly invoices. 8. KCC may apply its retainer to all prepetition invoices, which retainer may be replenished to the original retainer amount, and thereafter, KCC may hold its retainer under the Services Agreement during the chapter 11 cases as security for the payment of fees and expenses incurred under the Services Agreement. 9. The Debtors shall indemnify KCC under the terms of the Services Agreement, as modified pursuant to this order. 10. KCC shall not be entitled to indemnification, contribution, or reimbursement pursuant to the Services Agreement for services other than the services provided under the Services Agreement, unless such services and the indemnification, contribution, or reimbursement thereof are approved by the Court. 11. Notwithstanding anything to the contrary in the Services Agreement, the Debtors shall have no obligation to indemnify KCC, or provide contribution or reimbursement to KCC, 5158608-3-
Case 16-32689 Document 10-3 Filed in TXSB on 05/29/16 Page 5 of 7 for any claim or expense that is either: (i) judicially determined (the determination having become final) to have arisen from KCC s gross negligence, willful misconduct or fraud; (ii) for a contractual dispute in which the Debtors allege the breach of KCC s contractual obligations if the Court determines that indemnification, contribution, or reimbursement would not be permissible under applicable law; or (iii) settled prior to a judicial determination under (i) or (ii), but determined by this Court, after notice and a hearing, to be a claim or expense for which KCC should not receive indemnity, contribution, or reimbursement under the terms of the Services Agreement as modified by this Order. 12. If, before the earlier of (i) the entry of an order confirming a chapter 11 plan in these chapter 11 cases (that order having become a final order no longer subject to appeal), or (ii) entry of an order closing these chapter 11 cases, KCC believes that it is entitled to the payment of any amounts by the Debtors on account of the Debtors indemnification, contribution, and/or reimbursement obligations under the Services Agreement (as modified by this Order), including the advancement of defense costs, KCC must file an application therefor in this Court, and the Debtors may not pay any such amounts to KCC before entry of an order by this Court approving the payment. This paragraph is intended only to specify the period of time under which the Court shall have jurisdiction over any request for fees and expenses by KCC for indemnification, contribution, or reimbursement, and not a provision limiting the duration of the Debtors obligation to indemnify KCC. All parties in interest shall retain the right to object to any demand by KCC for indemnification, contribution, or reimbursement. 13. KCC shall not cease providing claims processing services during these chapter 11 cases for any reason, including nonpayment, without an order of the Court. In the event KCC is unable to provide the services set out in this order, KCC will immediately notify the Court s case 5158608-4-
Case 16-32689 Document 10-3 Filed in TXSB on 05/29/16 Page 6 of 7 manager, and the Debtors attorney and, upon approval of the Court, cause to have all original proofs of claim and computer information delivered as instructed by further court order. 14. Notwithstanding any term in the Services Agreement to the contrary, KCC S liability shall not be limited during the chapter 11 cases to the amount billed to or paid by the Debtors estates. 15. After entry of an order terminating KCC s services, upon the closing of these cases, or for any other reason, KCC shall be responsible for archiving all proofs of claim with the Federal Archives Record Administration, if applicable, and shall be compensated by the Debtors in connection therewith. 16. The Debtors and KCC are authorized to take all actions necessary to effectuate the relief granted pursuant to this Order in accordance with the Application. 17. Notwithstanding any term in the Services Agreement to the contrary, the Court retains jurisdiction with respect to all matters arising from or related to the implementation of this Order. 18. Notwithstanding any provision in the Bankruptcy Rules to the contrary, this Order shall be immediately effective and enforceable upon its entry. 19. In the event of any inconsistency between the Services Agreement, the Application and the Order, the Order shall govern. 20. Notice of the Application as provided therein shall be deemed good and sufficient notice of such Application and the requirements of Bankruptcy Rule 6004(a) and the Bankruptcy Local Rules are satisfied by such notice. 21. Notwithstanding Bankruptcy Rule 6004(a), the terms and conditions of this Order are immediately effective and enforceable upon its entry. 5158608-5-
Case 16-32689 Document 10-3 Filed in TXSB on 05/29/16 Page 7 of 7 22. The Debtors are authorized to take all actions necessary to effectuate the relief granted in this Order in accordance with the Application. 23. This Court retains exclusive jurisdiction with respect to all matters arising from or related to the implementation, interpretation, and enforcement of this Order. Dated: UNITED STATES BANKRUPTCY JUDGE 5158608-6-