Special Sale Provisions in a Chapter 11 Case.

(a) Breakup/Topping Fees and Expense Reimbursement. When the seller in a chapter 11 case is seeking Court approval of a breakup or topping fee or other bidding protections (such as the estate’s proposed payment of out-of-pocket expenses incurred by a bidder or contract purchaser), the sale motion must include the following: 32 (1) the name of the party entitled to the breakup or topping fee; (2) the dollar amount or the method to calculate the breakup or topping fee; and (3) any relationship between the seller and the party eligible for the breakup or topping fee. (b) Sale to Insider. If the seller seeks Court approval of a sale to an insider of the debtor, the motion must include the following information: (1) the name of the insider; (2) the relationship of the insider to the debtor; and (3) the measures that have and will be taken to ensure the fairness of the sale process.

(c) Agreements with Management. Any motion seeking approval of the private sale of an ongoing business must disclose the following: (1) (2) (3) whether the proposed purchaser has entered into any agreements with management or key employees concerning compensation or future employment; the material terms of any agreements between the proposed purchaser and management or key employees; and what measures have or will be taken to ensure the fairness of the sale in light of such agreements with management or key employees. (d) Tax Exemption. If the debtor is seeking to have a sale declared exempt from taxes under 11 U.S.C. § 1146(a), the sale motion must disclose the type of tax (i.e., recording tax, stamp tax, use tax, capital gains tax) for which the exemption is sought.

The debtor must also identify the state or states in which the affected property is located. The sale motion must state whether or not the chapter 11 plan has been confirmed. (e) Relief from F.R.B.P. 6004(h). If the seller seeks relief from the stay imposed by F.R.B.P. 6004(h), the sale motion must state the basis for the request.

COMMENTS: L.B.R. 6004-4(d) was amended effective December 1, 2009, to comply with the decision of Florida Dept. of Revenue v. Piccadilly Cafeterias, Inc., 128 S.Ct. 2326 (U.S. 2008). 33 Rule 6004-5 Sales of Property Free and Clear of Liens - Section 363(f). (a) Notice.

All free and clear sales are subject to the applicable notice requirements of L.B.R. 6004-1(b), (c), and (d). (b) Motion. A sale of property free and clear of liens must be commenced by motion, except as provided in subdivision (c) below. A motion for a free and clear sale must name as respondents all parties claiming an interest in the property.

(c) Complaint. A sale of property free and clear of liens must be brought as an adversary proceeding and commenced by a complaint under Part VII of the Federal Rules of Bankruptcy Procedure and Part VII of the Local Bankruptcy Rules when the seller also seeks: (1) (2) to determine the validity, priority, or extent of a lien or other interest in property, other than the avoidance of a lien or other transfer of property exempt under 11 U.S.C. § 522(f); or to obtain approval under 11 U.S.C. § 363(h) for the sale of both the interest of the estate and of a co-owner in the property unless the concurrence of the co- owner has been obtained. Order. When a motion is filed for a sale free and clear of liens, the clerk will issue an order fixing a response date and a hearing date.

A hearing will be held only if a responsive pleading is timely filed, unless a hearing is requested by the moving party or is ordered by the Court. Otherwise, an order granting the relief requested will be entered without a hearing. Service of Motion. The seller must serve a copy of the motion and the order referred to in subparagraph (d) upon all lienholders and other parties claiming an interest in the property and their counsel of record.

Service of Notice. Unless the Court directs otherwise, the seller must serve the notice on the respondent and any parties referenced in L.B.R. 6004-1(c), at least twenty-one (21) days before the hearing on the sale. (d) (e) (f)