U.S. Bankruptcy Judge Laurie Selber Silverstein signed a bidding procedures order Sept. 26 in the Furie Operating Alaska LLC Chapter 11 case in U.S. Bankruptcy Court for the District of Delaware.
The order set forth a schedule for the sale of the company’s assets, which include the Cook Inlet Kitchen Lights unit and its related infrastructure such as the Julius R offshore platform, the onshore processing facility and all related pipelines.
The deadline for the debtors to file a proposed form of Sale Order is 5 p.m. on Oct. 25.
Debtors shall file a Stalking Horse Supplement with the court on or before 5 p.m. on Oct. 25. The deadline to file an objection with the court to the Stalking Horse Supplement will be 10 calendar days after the service of the Stalking Horse Supplement.
The deadline to file an objection with the court to the proposed assumption and assignment of an assumed contract including any objection relating to the cure claim, is 4 p.m. on Oct. 23.
The deadline to submit a qualified bid is 12 p.m. on Nov. 7.
The auction, if one is held, will commence at 10 a.m. on Nov. 12.
By no later than 12 p.m. on the first calendar day after the debtors have selected the successful bid(s) and alternate bid(s), the debtors shall file the notice of auction results with the court.
The deadline to file an objection with the court to the sale, and all objections relating to the Stalking Horse bidder (if any), the conduct of the auction or the sale is 12 p.m. on Nov. 15.
A hearing to consider the proposed sale will be held before the court at 10 a.m. on Nov. 20. or such other date as determined by the court.
All the times listed above are at prevailing Eastern Time
Bidding proceduresEach interested party or entity is required, unless otherwise ordered by the court, to deliver preliminary bid documents to the debtors to participate in the bidding process.
Interested parties must execute and include a confidentiality agreement, as well as a statement with factual support demonstrating that the interested party has a bona fide interest in purchasing any or all of the assets.
Interested parties must include a description of the nature and extent of any due diligence it wishes to conduct and the date when its due diligence will be completed.
Each interested party must provide sufficient information that it has the financial wherewithal and internal corporate, legal or other authorizations to close the sale transaction.
If the debtors determine that an interested party has a bona fide interest in purchasing any or all of the assets, the interested party will be deemed a potential bidder and will receive a form of purchase agreement and access to the debtors’ confidential electronic data room.
Due diligenceUntil the bid deadline, debtors will provide potential bidders with reasonable due diligence access and additional information. If any potential bidder is (or is affiliated with) a competitor, customer, or vendor of the debtors, the debtors may withhold any information or due diligence deemed sensitive, proprietary or otherwise not appropriate for disclosure.
Likewise, the potential bidder will comply with all reasonable requests for additional information and due diligence access by the debtors or their advisors regarding such potential bidder and its contemplated transaction, failing which the bid may be disqualified.
Bid requirementsEach offer, solicitation or proposal by a potential bidder must satisfy certain conditions - waived by the debtors - to be deemed a qualified bid, and for the potential bidder to be deemed a qualified bidder.
Bids must be accompanied by a letter stating that the bidder’s offer is irrevocable until consummation of a transaction, and that the bidder agrees to serve as an alternate bidder.
Each bid must use an authorized and executed purchase agreement, based on the form purchase agreement provided, marked to show revisions, including the purchase price for the assets identified in the bid, together with all exhibits and schedules.
Each potential bidder must provide written evidence acceptable to the debtors demonstrating financial wherewithal, operational ability and corporate authorization to consummate the proposed transaction.
Potential bidders also must provide written evidence of a firm commitment for financing to consummate the proposed transaction, or other evidence of ability to consummate the proposed transaction without financing, that is satisfactory to the debtors.
Additional requirements apply, including a good faith cash deposit of 10% of the proposed purchase price.
The debtors have the right to deem a bid a qualified bid even if the bid does not conform to one or more of the requirements.
Secured Parties shall be deemed qualified bidders and can bid up to the full amount of the DIP obligations owed, subject to provisions of the Bankruptcy Code.
Distribution and evaluation of qualified bidsQualified bids will be considered by the debtors; bids other than qualified bids will not be considered. The debtors may evaluate bids on any grounds, including, but not limited to purchase price; value to be provided to the debtors including the net economic effect upon the debtors’ estates; benefit to the debtors’ bankruptcy estates from assumption or waiver of liabilities; transaction structure and execution risk; availability of financing and financial wherewithal; governmental or other approvals; anticipated timing to closing; impact on employees and employee claims against the debtors; governmental, licensing, regulatory or other approvals or consents in a bid; impact on trade and other creditors; and any other factors the debtors may reasonably deem relevant consistent with their fiduciary duties.
The debtors, in consultation with their consultation parties, may select a qualified bidder (Stalking Horse Bidder) to serve as the minimum bid for substantially all of the debtors’ assets or any grouping or subset of the debtors’ assets.
Parties in interest may object to the designation of a Stalking Horse Bidder or any terms of such within 10 calendar days after service of a Stalking Horse Supplement. If a timely Stalking Horse Objection is filed, the debtors will schedule a hearing seeking approval of the bid on or before Nov. 6.
AuctionOne or more auctions for the assets may be held in accordance with the bidding procedures and upon notice to all qualified bidders that have submitted qualified bids. If no more than one qualified bid is submitted by the bid deadline with respect to the assets or any lot of assets, or if in the judgment of the debtors an alternative transaction is in the best interest of the estate, the debtors may, in consultation with the consultation parties, elect to cancel the auction with respect to such assets and seek approval of the transactions contemplated in the bid at the Sale Hearing.
Prior to the conclusion of the auction, the debtors shall review and evaluate each bid on the basis of financial and contractual terms and other relevant factors, determine and identify the highest or otherwise best offer or collection of offers, and determine and identify the next highest or otherwise best offer or collection of offers.
Prior to auction adjournment, the debtors shall notify all qualified bidders participating in the auction of the identity of the successful bidder or bidders, the amount and other material terms of the successful bid or bids, the identity of the any party that submitted alternate bids, and the amount and other material terms of any alternate bid. No additional bids may be considered after the auction is closed.
The Sale HearingAt the Sale Hearing Nov. 20, the debtors will seek the court’s approval of successful bid(s), and alternate bid(s).
The debtors’ presentation to the court of any successful bid or alternate bid will not constitute the debtors’ acceptance of the bids, which acceptance will only occur upon approval of any such bids by the court.
Following the court’s entry of the Sale Order (if any) approving any bids, the debtors and the successful bidder(s) shall proceed to consummate the transaction(s) contemplated by the successful bid(s), within the milestones set in the DIP credit agreement, failing which the debtors shall file a notice with the court advising of such failure.
Upon the filing of notice with the court, the alternate bid(s) will be deemed to be the successful bid(s) and the debtors will be authorized but not directed to effectuate the transaction(s) with the alternate bidder(s) subject to the terms of the alternate bid(s) without further order of the court.
The sale of the assets will be on an “as is, where is” basis and without representations or warranties of any kind, nature or description by the debtors, their agents or their estates, except as provided in any agreement with respect to the transaction(s) approved by the court.
The debtors will seek an order approving the sale of all of the debtors’ right, title and interest in and to the assets, free and clear of any pledges, liens, security interests, encumbrances, claims, charges, options and interests to the maximum extent permitted by section 363 of the Bankruptcy Code, with such interests to attach to the net proceeds of the sale of the assets with the same validity and priority.