scc Doc 966 Filed 12/14/18 Entered 12/14/18 15:03:15 Main Document Pg 1 of 4

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1 scc Doc 966 Filed 12/14/18 Entered 12/14/18 15:03:15 Main Document Pg 1 of 4 TOGUT, SEGAL & SEGAL LLP One Penn Plaza Suite 3335 New York, New York (212) Frank A. Oswald Brian F. Moore Counsel to the Debtors and Debtors in Possession Objection Deadline: December 21, 2018 at 4:00 p.m. (ET) UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK x : In re: : Chapter 11 : TOISA LIMITED, et al., : Case No (SCC) : Debtors. 1 : (Jointly Administered) : x NOTICE OF: (I) SELECTION OF SUCCESSFUL BID AND PROPOSED SALE OF TOISA INDEPENDENT; (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 PLEASE TAKE NOTICE that, on January 29, 2017 (the Petition Date ), Toisa Limited ( Toisa ) and certain of its affiliates (each a Debtor, and collectively, the Debtors ) commenced voluntary cases under title 11 of the United States Code (the Bankruptcy Code ) in the United States Bankruptcy Court for the Southern District of New York (the Bankruptcy Court ). PLEASE TAKE FURTHER NOTICE that, on July 3, 2018, the Bankruptcy Court entered the 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 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 scc Doc 966 Filed 12/14/18 Entered 12/14/18 15:03:15 Main Document Pg 2 of 4 Sale Agreement [Docket No. 671] (the Offshore Sale Procedures Order ), 2 authorizing the Debtors to sell certain of their offshore vessels (collectively, the Vessels ), pursuant to the procedures set forth in the Offshore Sale Procedures Order. PLEASE TAKE FURTHER NOTICE that, pursuant to the Offshore Sale Procedures Order, the Debtors propose to enter into the transaction (the Sale ) described below, which involves the sale or transfer of Toisa Independent (the Vessel ) pursuant to the purchase and sale agreement attached to the Sale Order (as defined below) as Exhibit 1 (the Purchase Agreement ) and the addendum to the Purchase Agreement attached to the Sale Order as Exhibit 2 (the Addendum ). Below is a summary of the material terms of the Purchase Agreement and the Addendum: Vessel Being Sold: The British-flag vessel Toisa Independent (IMO No ). Seller: Edgewater Offshore Shipping LTD. Buyer: A1 Partners ApS or its designee, which is neither directly or indirectly owned or controlled by any of the Debtors current or former shareholders, officers, directors or employees. Purchase Price: $1,850,000. Conditions to Closing: Before the Sale may be closed: (i) the Bankruptcy Court must approve the Sale; and (ii) the Seller must deliver certain transfer documents to the Nuyer. Terms of Payment: Buyer has deposited $214,970 with Kurtzman Carson Consultants LLC as of the date hereof; Buyer shall pay the balance of the Purchase Price (i.e. $1,635,030) at closing. Known Liens: The Vessel is subject to a first priority mortgage in favor of Citizens Bank NA ( Citizens ), securing a senior secured credit facility dated as of July 28, 2010 (the Citizens I Credit Facility ) in the outstanding principal amount of approximately $12,260,416 (as of the Petition Date). Secured Vessel Lender and other Parties holding or asserting Liens against the Vessel: Citizens, which consents to the Sale. Marketing Efforts: This information is set forth in the Fawthrop Declaration (as defined below). Broker Commission: $18, Capitalized terms used, but not otherwise defined herein, shall take the meanings ascribed to them in the Offshore Sale Procedures Order. 2

3 scc Doc 966 Filed 12/14/18 Entered 12/14/18 15:03:15 Main Document Pg 3 of 4 PLEASE TAKE FURTHER NOTICE that, pursuant to the Offshore Sale Procedures Order, the Debtors intend to seek entry of an order substantially in the form attached to this Notice as Exhibit A (the Sale Order ) authorizing the consummation of the Sale and granting relief pursuant to sections 363(f) and 363(m) of the Bankruptcy Code. PLEASE TAKE FURTHER NOTICE that, in support of the Sale Order and the relief set forth therein, the Debtors submit the Declaration of Jonathan Milne Fawthrop, attached to this Notice as Exhibit B (the Fawthrop Declaration ) and the Declaration of Jonathan Mitchell, the Debtors Chief Restructuring Officer, attached to this Notice as Exhibit C (the Mitchell Declaration and, together with the Fawthrop Declaration, the Supporting Declarations ) setting forth the factual basis for the relief requested in the Sale Order. PLEASE TAKE FURTHER NOTICE that, consistent with the Offshore Sale Procedures Order and the Supporting Declarations, if the Bankruptcy Court enters an order granting relief pursuant to section 363(f) of the Bankruptcy Code, upon closing, the Vessel and related assets being sold shall be transferred pursuant to the Sale free and clear of all liens, claims, encumbrances, and other interests (collectively, Liens ), with such Liens attaching 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 immediately prior to such Sale. PLEASE TAKE FURTHER NOTICE that, objections, if any, to the Sale must be filed with this Court and served on: (a) counsel for the Debtors, Togut, Segal & Segal LLP, One Penn Plaza, Suite 3335, New York, New York (Attn: Frank A. Oswald, Esq.); (b) the Office of the United States Trustee, 201 Varick Street, Room 1006, New York, New York (Attn: Paul K. Schwartzberg, Esq.); (c) counsel to the Informal Committee, Cadwalader, Wickersham & Taft LLP, 200 Liberty Street, New York, New York (Attn: Gregory M. Petrick, Esq. and Michele C. Maman, Esq.); (d) counsel to the Creditors Committee, Morgan, Lewis & Bockius LLP, 101 Park Avenue, New York, New York (Attn: Craig A. Wolfe, Esq. and Jason R. Alderson, Esq.); (e) counsel to Citizens, Vedder Price, 1633 Broadway, 31st Floor, New York, New York (Attn: Michael J. Edelman, Esq.); and (f) all parties that filed a notice of appearance in these Chapter 11 Cases (collectively, the Objection Notice Parties ), so as to be actually received on or before the date that is seven (7) calendar days following the date of this Notice (i.e. December 21, 2018 at 4:00 p.m. (ET)) (the Objection Deadline ). If no written objection is filed with this Court and served on the Objection Notice Parties on or before the Objection Deadline, the Sale Order may be entered without the need for a Sale Hearing (as defined below), as provided for in the Offshore Sale Procedures Order. [Concluded on the following page] 3

4 scc Doc 966 Filed 12/14/18 Entered 12/14/18 15:03:15 Main Document Pg 4 of 4 PLEASE TAKE FURTHER NOTICE that, in the event an objection to the Sale is timely filed and served in accordance with the above paragraph, a hearing to consider the Sale (the Sale Hearing ) shall be held before the Honorable Shelley C. Chapman, United States Bankruptcy Judge for the Southern District of New York, at the United States Bankruptcy Court, Courtroom 623, One Bowling Green, New York, New York 10004, at a date and time to be determined by the Court. Dated: New York, New York December 14, 2018 Toisa Limited, et al. Debtors and Debtors in Possession By their Counsel TOGUT, SEGAL & SEGAL LLP By: /s/ Brian F. Moore FRANK A. OSWALD BRIAN F. MOORE One Penn Plaza, Suite 3335 New York, New York Telephone: (212)

5 Proposed Order Pg 1 of 29 EXHIBIT A

6 Proposed Order Pg 2 of 29 UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK x : In re: : Chapter 11 : TOISA LIMITED, et al., : Case No (SCC) : Debtors. 1 : (Jointly Administered) : x ORDER AUTHORIZING AND APPROVING SALE OF TOISA INDEPENDENT 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 Independent; (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 Independent 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 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.

7 Proposed Order Pg 3 of 29 Independent (the Vessel ) to A1 Partners ApS or its designee (the Buyer ), 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 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 and 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 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 ). 2

8 Proposed Order Pg 4 of 29 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 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 3

9 Proposed Order Pg 5 of 29 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 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. 4

10 Proposed Order Pg 6 of 29 L. The terms and conditions of the Purchase Agreement and the Addendum are fair and reasonable. The consideration provided by the Buyer for the Vessel pursuant to the Purchase Agreement and 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 nonbankruptcy law. M. Edgewater Offshore Shipping LTD or designee 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 5

11 Proposed Order Pg 7 of 29 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 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 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 6

12 Proposed Order Pg 8 of 29 or any agent of the foregoing to recover any claim which such person or entity has solely against the Debtors or their estates. 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 7

13 Proposed Order Pg 9 of 29 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, 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 $18,500. The remaining cash proceeds (including any cash deposit made by the Buyer) generated from the Sale shall be deposited directly into the Debtors account at Citibank, N.A., London Branch, with account number xxxx1267 (the Debtors Account ), subject to the terms of the Twenty-Second Interim Cash Management Order [Docket No. 756] or any applicable cash management or cash collateral order in effect. The Debtors shall cause such cash proceeds be paid from the Debtors Account to permanently reduce the 8

14 Proposed Order Pg 10 of 29 outstanding principal amount of the prepetition obligations owed to Citizens Bank NA ( Citizens ) in accordance with a closing memorandum (the Closing Memorandum ) to be delivered by the Debtors to Citizens 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 Citizens and the Debtors (in consultation with the Informal Committee and the Creditors Committee). 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 Debtors Account for Citizens in accordance with the Twenty-Second Interim Cash Management Order or any applicable cash management or cash collateral order in effect, and upon the closing of the Sale the remainder of the cash proceeds and any other cash in the Debtors Account for Citizens shall be applied to permanently reduce the outstanding principal amount of the prepetition obligations owed to Citizens. If the Debtors and Citizens 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 Citizens a motion, on at least ten (10) days prior written notice to Citizens 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 Debtors Account for 9

15 Proposed Order Pg 11 of 29 Citizens shall be made without further order of this Court. All of Citizens rights to object to any such motion are reserved. If the Debtors do not file a motion within fourteen (14) days from the Closing Date, the Disputed Amounts shall be applied to permanently reduce the outstanding principal amount of the prepetition obligations owed to Citizens. The Debtors shall work in good faith with their advisors to timely prepare the Closing Memorandum prior to the closing of each Sale. 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 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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34 scc Doc Filed 12/14/18 Entered 12/14/18 15:03:15 Exhibit B: Fawthrop Declaration Pg 1 of 5 EXHIBIT B

35 scc Doc Filed 12/14/18 Entered 12/14/18 15:03:15 Exhibit B: Fawthrop Declaration Pg 2 of 5 UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK x : In re: : Chapter 11 : TOISA LIMITED, et al., : Case No (SCC) : Debtors. 1 : (Jointly Administered) : x DECLARATION OF JONATHAN MILNE FAWTHROP IN SUPPORT OF THE DEBTORS SALE OF TOISA INDEPENDENT TO A1 PARTNERS APS OR ITS DESIGNEE I, Jonathan Milne Fawthrop, under penalty of perjury, declare as follows: 1. I am a Divisional Director of H. Clarkson & Company Limited ( Clarkson or the Broker ), the Debtors retained shipbroker in these chapter 11 cases (collectively, the Chapter 11 Cases ). 2. Clarkson was authorized to act as shipbroker to the abovecaptioned debtors and debtors in possession (collectively, the Debtors ) nunc pro tunc to February 26, 2018 by Order of the Court dated as of April 5, 2018 [Docket No. 636]. On June 26, 2018, by Order of the Court, Clarkson s retention was expanded to authorize the firm to act as shipbroker to the Debtors in relation to the sale of the Debtors Offshore Vessels (defined below) nunc pro tunc to May 15, 2018 [Docket No. 655]. 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.

36 scc Doc Filed 12/14/18 Entered 12/14/18 15:03:15 Exhibit B: Fawthrop Declaration Pg 3 of 5 3. I am authorized to make this declaration (this Declaration ) on behalf of Clarkson in support of an order approving the sale (the Sale ) of the Britishflag vessel Toisa Independent (the Vessel ) pursuant to the memorandum of agreement dated as of August 14, 2018 (the Purchase Agreement ) by and between Debtor Edgewater Offshore Shipping LTD, as seller (the Seller ), and A1 Partners ApS or its designee, as buyer (the Buyer ), and the addendum to the Purchase Agreement dated as of December 3, 2018 (the Addendum ) by and between Seller and Buyer, and to comply with Paragraph 3(k) of the Offshore Sale Procedures Order (as defined below). 4. Except as otherwise indicated, I have personal knowledge of the matters set forth herein and, if called as a witness, would testify competently thereto. 2 THE OFFSHORE SALE PROCEDURES 5. On June 11, 2018, the Debtors filed a motion [Docket No. 635] (the Offshore Sale Procedures Motion ) seeking this Court s approval of procedures (the Offshore Sale Procedures ) regarding the sale of their fleet of twenty-six (26) offshore support vessels (collectively, the Offshore Vessels ). 6. On July 3, 2018, the Court entered an Order granting the relief requested in the Offshore Sale Procedures Motion [Docket No. 671] (the Offshore Sale Procedures Order ) Paragraph 3(k) of the Sales Procedure Order provides, in pertinent part, that [t]he Debtors shall attach to each Sale Notice, as applicable, (a) a 2 Certain of the disclosures herein relate to matters within the knowledge of other professionals of the Debtors and are based on information provided to me by them. 3 Capitalized terms used but not defined herein shall have the meaning ascribed to such term in the Offshore Sale Procedures Order. 2

37 scc Doc Filed 12/14/18 Entered 12/14/18 15:03:15 Exhibit B: Fawthrop Declaration Pg 4 of 5 supplemental declaration from the Broker in support of the Sale describing the marketing efforts undertaken by the Broker and explaining the reasons why the Successful Bid was the highest or best Qualified Bid.... Offshore Sale Procedures Order, 3(k). MARKETING AND SALE PROCESS 8. On July 20, 2018, Clarkson transmitted notice (the Notice ) to its vast network of over 300 companies that Clarkson identified as potentially having an interest in acquiring the Vessel (collectively, Potential Bidders ) and contemporaneously caused notice that the deadline to submit a bid for the Vessel was August 3, 2018 (the Bid Deadline ) to be served on various parties in interest in the Chapter 11 Cases, as well as any Potential Bidders that expressed interest in purchasing the Vessel. 9. The Debtors received 5 bids for the Vessel from potential purchasers, all of which the Debtors determined constituted Qualified Bids in accordance with the Offshore Sale Procedures Order. 10. Following the Bid Deadline, Clarkson contacted each bidder for the Vessel to induce such bidders to increase their bids. Following discussions with Clarkson, the Buyer agreed to increase its bid to $2,150,000, which was the highest and best offer received for the Vessel. 11. The Vessel later sustained damage from a storm and the parties agreed to adjust the purchase price for the Vessel. As reflected in the Addendum, the parties agreed to adjust the purchase price to $1,850,000. THE SUCCESSFUL BID 12. After reviewing the bids received for the Vessel with their professionals (including Clarkson), the Debtors selected Buyer s bid as the highest or 3

38 scc Doc Filed 12/14/18 Entered 12/14/18 15:03:15 Exhibit B: Fawthrop Declaration Pg 5 of 5 otherwise best offer received for the Vessel on the basis that it provided the highest cash purchase price, and the Buyer offered reasonable assurances that the Sale would close. 13. The purchase price subsequently adjusted by the Addendum was still the highest or otherwise best offer received for the Vessel. 14. I believe that the Vessel was marketed in a manner designed to maximize the purchase price obtained for same in accordance with the Offshore Sale Procedures. 15. The Buyer s offer is the highest or otherwise best offer received for the Vessel to date, is in line with the market for similar vessels, and constitutes reasonably equivalent value for the Vessel. 16. I am advised that, on October 1, 2018, the Buyer paid a deposit to Kurtzman Carson Consultants LLC in the amount of $214,970 (the Deposit ). I am further advised that the Deposit is being held in escrow pending closing of the Sale. Pursuant to 28 U.S.C. 1746, I declare under penalty of perjury that the foregoing is true and correct to the best of my knowledge, information, and belief. DATED: December 14, 2018 /s/ Jonathan Milne Fawthrop Jonathan Milne Fawthrop Divisional Director H. Clarkson & Company Limited 4

39 scc Doc Filed 12/14/18 Entered 12/14/18 15:03:15 Exhibit C: Mitchell Declaration Pg 1 of 7 EXHIBIT C

40 scc Doc Filed 12/14/18 Entered 12/14/18 15:03:15 Exhibit C: Mitchell Declaration Pg 2 of 7 UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK x : In re: : Chapter 11 : TOISA LIMITED, et al., : Case No (SCC) : Debtors. 1 : (Jointly Administered) : x DECLARATION OF JONATHAN MITCHELL IN SUPPORT OF THE DEBTORS SALE OF TOISA INDEPENDENT TO A1 PARTNERS APS OR ITS DESIGNEE I, Jonathan Mitchell, under penalty of perjury, declare as follows: 1. I am an authorized representative of the firm Zolfo Cooper Management, LLC and, since January 29, 2018, I have been acting as the Chief Restructuring Officer of the above-captioned debtors and debtors in possession (collectively, the Debtors ). 2. I am authorized to make this declaration (this Declaration ) on behalf of the Debtors in support of an order approving the sale (the Sale ) of the British-flag vessel Toisa Independent (the Vessel ) pursuant to the memorandum of agreement dated as of August 14, 2018 (the Purchase Agreement ) by and between Debtor Edgewater Offshore Shipping LTD, as seller (the Seller ), and A1 Partners ApS or its designee, as buyer (the Buyer ), and the addendum to the Purchase Agreement dated as of December 3, 2018 (the Addendum ) by and between Seller and Buyer, and 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. (Continued)

41 scc Doc Filed 12/14/18 Entered 12/14/18 15:03:15 Exhibit C: Mitchell Declaration Pg 3 of 7 to comply with Paragraph 3(k) of the Offshore Sale Procedures Order (as defined below). 3. Except as otherwise indicated, I have personal knowledge of the matters set forth herein and, if called as a witness, would testify competently thereto. 2 CITIZENS I CREDIT FACILITY 4. Seller is a borrower under that certain senior secured credit facility, dated as of July 28, 2010, utilized to finance the purchase of the Vessel (the Citizens I Credit Facility ). The Citizens I Credit Facility has a term of seven (7) years from the drawdown date and a rate of Libor + 2.5%. As of the Petition Date, the unpaid principal balance on the Citizens I Credit Facility was approximately $12,260,416. Seller s obligations under the Citizens I Credit Facility are secured by a lien on the Vessel, including assignment of insurance and charters. The lender under the Citizens I Credit Facility is Citizens Bank NA (the Secured Lender ). THE OFFSHORE SALE PROCEDURES 5. On June 11, 2018, the Debtors filed a motion [Docket No. 635] (the Offshore Sale Procedures Motion ) seeking this Court s approval of procedures for the sale of their fleet of twenty-six (26) offshore support vessels (collectively, the Offshore Vessels ). Contemporaneously with the Offshore Sale Procedures Motion, the Debtors filed an application [Docket No. 636] (the Expanded Clarkson Retention Application ) seeking authority to expand the retention and employment of the experienced shipbroker, H. Clarkson & Company Limited ( Clarkson ) to facilitate the sale of, and maximize the value obtained for, the Offshore Vessels. 2 Certain of the disclosures herein relate to matters within the knowledge of other professionals of the Debtors and are based on information provided to me by them. 2

42 scc Doc Filed 12/14/18 Entered 12/14/18 15:03:15 Exhibit C: Mitchell Declaration Pg 4 of 7 6. On July 3, 2018, this Court entered an Order granting the relief requested in the Sales Procedure Motion [Docket No. 671] (the Offshore Sale Procedures Order ) 3 and on June 26, 2018 the Expanded Clarkson Retention Application [Docket No. 655]. 7. Paragraph 3(k) of the Offshore Sale Procedures Order provides, in pertinent part, that (b) a declaration from an officer of the Debtors containing factual support sufficient for the Court to find that: (i) the Sale constitutes a prudent exercise of the Debtors business judgment; (ii) the Sale may be consummated free and clear of all Liens under section 363(f) of the Bankruptcy Code; and (iii) the Purchaser is a good faith purchaser entitled to the protections of section 363(m) of the Bankruptcy Code. Offshore Sale Procedure Order, 3(k). STATEMENTS PURSUANT TO PARAGRAPH 3(k) OF THE OFFSHORE SALE PROCEDURES ORDER I. The Sale Constitutes a Prudent Exercise of the Debtors Business Judgment. 8. I believe that the Sale is in the best interest of the Debtors and their estates and constitutes a prudent exercise of the Debtors business judgment. 9. As discussed more fully in the Declaration of Jonathan Milne Fawthrop in Support of the Debtors Sale of the Toisa Independent to A1 Partners ApS or its Designee filed contemporaneously herewith (the Fawthrop Declaration ), Clarkson sufficiently marketed the Vessel by, among other things, transmitting notice of the Sale to its vast network of over 300 companies that Clarkson identified as potentially having an interest in acquiring the Vessel (collectively, Potential Bidders ). 3 Capitalized terms not otherwise defined herein shall have the meaning ascribed to such terms in the Offshore Sale Procedures Order. 3

43 scc Doc Filed 12/14/18 Entered 12/14/18 15:03:15 Exhibit C: Mitchell Declaration Pg 5 of Additionally, on July 20, 2018, Clarkson caused notice that the deadline to submit a bid for the Vessel was August 3, 2018 (the Bid Deadline ) to be served on various parties in interest in the Chapter 11 Cases, as well as any Potential Bidders that expressed interest in purchasing the Vessel. 11. The Debtors received 5 bids for the Vessel from potential purchasers, all of which the Debtors determined constituted Qualified Bids in accordance with the Offshore Sale Procedures Order. 12. Following the Bid Deadline, Clarkson contacted each bidder for the Vessel to induce such bidders to increase their bids. Following discussions with Clarkson, the Buyer agreed to increase its bid to $2,150,000, which was the highest and best offer received for the Vessel. 13. I reviewed all of the bids received for the Vessel prior to selecting Buyer s bid as the highest or best offer for the Vessel. 14. The Debtors, in consultation with the Debtors professionals (including Clarkson) and counsel for the Informal Committee, the Creditors Committee and the Secured Lender, selected Buyer s bid as the highest or otherwise best offer received for the Vessel on the basis that it provided the highest cash purchase price, and the Buyer offered reasonable assurances that the Sale would close. The Secured Lender consented to the Sale of the Vessel to the Buyer. 15. The Vessel later sustained damage from a storm and the parties agreed to adjust the purchase price for the Vessel. As reflected in the Addendum, the parties agreed to adjust the purchase price to $1,850, I believe that the Buyer s offer is the highest or otherwise best offer received for the Vessel to date, is in line with the market for similar vessels, and constitutes reasonably equivalent value for the Vessel. 4

44 scc Doc Filed 12/14/18 Entered 12/14/18 15:03:15 Exhibit C: Mitchell Declaration Pg 6 of For these reasons, I believe that selling the Vessel to the Buyer pursuant to the terms set forth in the Purchase Agreement constitutes a prudent exercise of the Debtors business judgment. II. The Vessel Should be Transferred Free and Clear of all Liens, Claims, Encumbrances, and Other Interests Pursuant to Section 363(f) of the Bankruptcy Code. 18. I believe consummation of the Sale and transfer of the Vessel free and clear of all liens, claims, encumbrances and other interests (collectively, Liens ) is appropriate pursuant to section 363(f) of the Bankruptcy Code. As of the date hereof, the only known Lien against or with respect to the Vessel is the Secured Lender s Lien pursuant to the Citizens I Credit Facility. As noted above, the Secured Lender has consented to the Sale of the Vessel to the Buyer free and clear of all Liens. I am advised that the Secured Lender shall have a corresponding Lien on the proceeds of the Sale, and that 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. 19. Further, I do not believe that the Buyer is a mere continuation of the Debtors or that the Sale constitutes a de facto merger. III. The Buyer Should Be Entitled to the Protections of Section 363(m) of the Bankruptcy Code 20. I believe the Buyer is a good faith purchaser for value 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, and at all times each of the Buyer and the Debtors were represented by competent counsel of their choosing; (iii) the Buyer did not in any way induce or cause the filing of the Chapter 11 Cases; (iv) the 5

45 scc Doc Filed 12/14/18 Entered 12/14/18 15:03:15 Exhibit C: Mitchell Declaration Pg 7 of 7 consideration provided the Buyer pursuant to the Sale is fair and reasonable; and (v) the Sale is not the result of fraud or collusion. 21. Based on the foregoing, I believe the Buyer was acting in good faith within the meaning of 11 U.S.C. 363(m) with respect to the Sale and is entitled to the protections thereof. Pursuant to 28 U.S.C. 1746, I declare under penalty of perjury that the foregoing is true and correct to the best of my knowledge, information, and belief. DATED: December 14, 2018 /s/ Jonathan Mitchell Jonathan Mitchell Chief Restructuring Officer Toisa Limited 6