Bankruptcy Auction of Natty Greene's Brewing Company, LLC

Please see documents section for the filed MOTION FOR ORDERS PURSUANT TO SECTIONS 105(a), 363, AND 704 OF THE BANKRUPTCY CODE (A) AUTHORIZING AND SCHEDULING AN AUCTION AT WHICH TRUSTEE WILL SOLICIT BIDS FOR THE SALE OF ASSETS; (B) APPROVING PROCEDURES FOR SUBMISSION OF COMPETING BIDS; (C) APPROVING BREAKUP FEE PROVISON; (D) SCHEDULING A HEARING TO CONSIDER APPROVAL OF SUCH SALE AFTER BIDDING PROCESS HAS BEEN COMPLETED; (E) APPROVING THE FORM AND MANNER OF NOTICE OF AUCTION PROCEDURES AND SALE HEARING; (F) AUTHORIZING THE OPENING BID AMOUNT IN FAVOR OF INITIAL PURCHASER ; (G) AUTHORIZING THE SALE OF ASSETS TO BE FREE AND CLEAR OF ALL LIENS, CLIMAS, ENSUMBRANCES AND OTHER CLAIMS OF INTEREST AND TRANSFERRING SUCH CLAIMS TO THE PROCEEDS OF SALE; (H) APPROVING THE FORM OF THE ASSET PURCHASE AGREEMENT; AND (I) GRANTING RELATED RELIEF INCLUDING, IF NECESSARY, A HEARING UNDER 11 U.S.C. § 506

The General Terms of the Agreement are as follows:

a. Sale: The Asset Purchase Agreement contemplates that the assets will be sold for a total sum of $185,000.00. This initial purchase price will be deemed the initial opening bid at a Court approved auction sale. The auction sale will be conducted through Iron Horse Auction Company. The auction sale will be subject to confirmation by the Bankruptcy Court. If there are no upset bids the Trustee will seek that the Court pre-approve the initial bid of $185,000.00. All parties in interest and any perspective purchaser of the Purchased Assets are urged to review the Asset Purchase Agreement in its entirety for a complete and thorough understanding of all its terms and conditions. In the event of any contradiction or inconsistency between the Asset Purchase Agreement and this Motion, the provisions of the Asset Purchase Agreement shall govern. Attached hereto and incorporated herein by reference and identified as Exhibit “A” is a copy of the Asset Purchase Agreement. The Auction Sale will an online absolute auction subject only to confirmation by the Court. The bidding will start at 1:00p.m. March 11, 2021.
b. Carve Out. The sale proceeds shall be allocated in the following manner from the $185,000.00 and any Acceptable Upset Bid and shall be as follows:
(a) $10,000.00 for the Court Approved Auctioneer.
(b) $15,000.00 as carve out for the Chapter 7 Estate, $3,500.00 of said carve out will be allocated towards payment of marketing for the use by Auctioneer, therefore netting the Chapter 7 estate $11,500.00.
(c) $32,651.36 paid for unpaid property tax (amount estimated)
(d) $127,348.64 to be paid to the secured creditor, Truist from the original bid of $185,000.00.
(e) Any Acceptable Upset Bid shall include an additional 8% buyers premium (less $10,000.00 auction/fee above. The buyers premium is to be paid directly to the Auctioneer. (Example: if minimum acceptable upset bid of $196,000.00 is highest bidder the total out of pocket will be $196,000.00 plus net buyers premium of $5,680.00, which equals $201,680.00. (Example: buyers premium is $15,680.00 with $10,000.00 credit leaving $5,680.00 owed to auctioneer)
(f) Any Acceptable Upset Bid shall be allocated at 100%, not including buyers premium, between $185,000 and $250,000.00 to Truist, 15% of any amount between $250,000.00 and $300,000.00 as a carve out to Chapter 7 estate and 85% being paid to Truist Bank.
(g) Any Acceptable Upset bid in excess of $300,000.00 shall be allocated at 20% to the Chapter 7 estate and 80% to the secured creditor, Truist Bank.
(h) Any proceeds in excess of an amount to pay Truist Bank, in full, will be held in escrow subject to future orders of the Bankruptcy Court for any disbursement thereof concerning disputed liens or other encumbrances on said proceeds.

Acceptable Bidders Must Complete the following Asset Purchase Agreement Prior to 4p.m. on March 8:

ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT dated _____, 2021 (referred to herein as this
“Agreement” or the “Asset Purchase Agreement”) is entered into by and between Charles M. Ivey,
III, as Trustee for the bankruptcy estate of Natty Greene’s Brewing Company, LLC (“Seller”) and
______________ hereinafter (“Initial Purchaser”).
RECITALS
WHEREAS, on October 18, 2020 (“Petition Date”), Natty Greene’s Brewing Company,
LLC (“Debtor”) filed a voluntary petition for relief under Chapter 7 of Title 11 of the United States
Code. As a result of that filing Charles M. Ivey, III is the duly appointed, qualified and acting
Trustee in this proceeding (“Trustee”).
WHEREAS, prior to filing the Debtor was in the business of operating a Beer/Brewery
Company located at 1918 W. Gate City Blvd in Greensboro, North Carolina. The assets of the
Debtor Corporation as contained at the location above are encumbered to Truist Bank, Successor
by Merger of SunTrust Bank (“Bank”). The outstanding obligation owed on this secured obligation
as of the date of filing is approximately $627,003.29, upon information and belief.
WHEREAS, after the filing the Trustee was contacted by numerous parties concerning the
potential sale of the assets of the Debtor Corporation. As a result, the Trustee has negotiated with
and shown the assets to multiple parties. The Purchaser has proposed to purchase the assets based
upon an opening confirmed bid of $185,000.00 upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in conjunction with the foregoing and the mutual agreements,
covenants, representations, warranties, and promises set forth herein, and in order to prescribe the
terms and conditions of this Agreement the Parties agree as follows:
1.1 Purchase and Sale. Subject to the terms and conditions set forth in this
Agreement, at the Closing (as defined below in Section 14), Seller agrees to sell, transfer, and
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deliver to Purchaser, and Purchaser agrees to purchase, acquire and accept from Seller, all right,
title and interest of Seller in and to all of the assets (the “Purchased Assets”) owned by the Seller
except for the Excluded Assets (as defined below in Section 1.2). The Purchased Assets shall be
transferred free and clear of all liens, claims, encumbrances, and interest to the maximum extent
permitted by Section 363 of the Bankruptcy Code (as more particularly described in Section 1.4)
and attached hereto and incorporated herein by reference as Exhibit “A”.
(a) All books and records of Seller (including promotional materials) relating to (i) the
business operations of the Seller and (ii) the Purchased Assets. Seller shall be entitled to make and
retain copies of such books and records. Purchaser shall retain such books and records for a period
of three years from the Closing Date and shall allow Seller or its argents reasonable access to the
same;
(b) Any and all patents, trademarks, copyrights, trade secrets, license rights and all
other intellectual property owned or licensed by Seller and any and all rights associated therewith
to enforce, maintain or otherwise preserve the same.
1.2. Excluded Assets. The Purchased Assets shall not include any of the following assets:
(a) Causes of action owned by the Seller under 11 U.S.C. § 541;
(b) Any and all avoidance actions as that term is defined in the United States
Bankruptcy Code, including causes of action under 11 U.S.C. § 510, 542, 543, 544, 545, 546, 547,
548, 549, 550, 551 and 724(a);
(c) 2007 Isuzu Box Truck;
(d) A forfeited deposit from a Highest Bidder (as defined in the Sale Motion)
resulting from its failure to close.
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1.3. No Assumption of Liabilities. No liabilities are being assumed. All Liabilities shall be
dealt with pursuant to the terms as set forth in the United States Bankruptcy Code and as applicable
in the Chapter 7 bankruptcy proceedings.
1.4. No Liens, Secured Interests, Encumbrances or Other Claims. The Purchased Assets
shall be sold pursuant to, and to the fullest extent permitted by, 11 U.S.C. § 363(f) and all other
applicable laws free and clear of any and all of the following (collectively, “Liens”): liens, security
interests, encumbrances and claims (including, but not limited to, any “claims” as defined in 11
U.S.C. § 101(5), reclamation claims, mortgages, deeds of trust, pledges, covenants, restrictions,
hypothecations, charges, indentures, loan agreements, causes of action, instruments, contracts,
leases, licenses, options, rights of first refusal, offsets, recoupment, replevin, rights of recovery,
judgments, orders and decrees of any court or foreign or domestic governmental entity, claims for
reimbursement, successor liability, contribution, indemnity or exoneration, assignment,
preferences, debts, charges, suits, rights of recovery, interests, products liability, merchantability,
fitness for a particular purpose, any warranty as described in N.C.G.S. § 25-2A-211, alter-ego,
environmental, successor liability, tax and other liabilities, causes of action and claims, and in each
case whether secured or unsecured, choate or inchoate, filed or unfiled, scheduled or unscheduled,
notice or unnoticed, recorded or unrecorded, perfected or unperfected, allowed or disallowed,
contingent or non-contingent, liquidated or unliquidated, matured or unmatured, material or nonmaterial, disputed or undisputed, or known or unknown whether arising prior to, on, or subsequent
to the date on which Debtor filed its voluntary petition under Chapter 7 of the Bankruptcy Code,
whether imposed by agreement, understanding, law, equity or otherwise (collectively, the “Liens
and Claims”), with any Liens and Claims to attach only to the proceeds of sale with the same
priority, validity, force and effect as they existed with respect to the Purchased Assets before the
Closing Date. As a result of the Liens and Claims being transferred to the proceeds of sale, the
parties holding secured claims shall not have rights to credit bid at the Auction Sale as would be
authorized under 11 U.S.C. § 363(k) or as might otherwise be authorized by any applicable law;
provided, however, that Purchaser may credit bid the amount of its security interests and liens.
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1.5. Purchase Price.
(a) In consideration for the sale, transfer, and delivery of sale Assets, as closing
as defined below, Purchaser shall deliver to Seller the sum of the Highest Acceptable Bid which
is confirmed by the Court pursuant to the Auction Procedures as hereinafter set forth.
(b) Minimal Acceptable Bid shall be the opening bid as provided by the Seller
herein in the amount of $185,000.00.
(c) The Purchase Price shall be payable at closing to the Trust Account of Ivey,
McClellan, Gatton & Siegmund, LLP, attorneys for the Trustee, plus the amount of any good faith
deposit as hereinafter defined as “Good Faith Deposit”.
1.6. Allocation of Sale Proceeds (Carve Out). The sale proceeds shall be allocated in the
following manner from the $185,000.00 and any Acceptable Upset Bid and shall be as follows:
(a) $10,000.00 for the Court Approved Auctioneer;
(b) $15,000.00 as carve out for the Chapter 7 Estate, $3,500.00 of said carve
out will be allocated towards payment of marketing for the use by Auctioneer, therefore netting
the Chapter 7 estate $11,500.00;
(c) $32,651.36 paid for unpaid property tax (amount estimated);
(d) $127,348.64 to be paid to the secured creditor, Truist from the original bid
of $185,000;
(e) Any Acceptable Upset Bid shall include an additional 8% buyers premium
(less $10,000.00 auction/fee above). The buyers premium is to be paid directly to the Auctioneer.
(Example: if minimum acceptable upset bid of 196,000.00 is highest bidder the total out of pocket
will be $196,000.00 plus net buyer premium of $5,680.00, which equals $201,680.00. (Example:
buyers premium is $15,680.00 with $10,000.00 credit leaving $5,680.00 owed to auctioneer);
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(f) Any Acceptable Upset Bid shall be allocated at 100%, not including buyers
premium, between $185,000 and $250,000.00 to Truist, 15% of any amount between $250,000.00
and $300,000.00 as a carve-out to Chapter 7 estate and 85% being paid to Truist Bank;
(g) Any Acceptable Upset Bid in excess of $300,000.00 shall be allocated at
20% to the Chapter 7 estate and 80% to the secured creditor, Truist Bank;
(h) Any proceeds in excess of an amount to pay Truist Bank, in full, will be
held in escrow subject to future orders of the Bankruptcy Court for any disbursement thereof
concerning disputed liens or other encumbrances on said proceeds.
1.7. Good Faith Deposit. Simultaneously with the execution of this Agreement, Purchaser
shall deliver to Seller’s attorneys, Ivey, McClellan, Gatton & Siegmund, the sum of $25,000.00
(“Good Faith Deposit”). Payment shall be made in certified funds only or in a method satisfactory
to the Trustee.
1.8. Closing. The closing (the “Closing”) of the purchase and sale of the Purchased Assets
shall take place in the offices of Ivey, McClellan, Gatton & Siegmund, Greensboro, North
Carolina, within ten (10) business days after the entry of the Sale Approved Order (“Closing
Date”). The Closing may be accomplished remotely through the delivery of signatures by facsimile
transmission or electronic mail, doc-u-serve, or similar electronic signature procedures, with
original signatures to follow by overnight courier.
1.9. Deliveries by Seller. At Closing, Seller will deliver to Purchaser all documents,
instruments and writings reasonably requested by Purchaser to be delivered by Seller at or prior to
the Closing pursuant to this Agreement, including, but not limited to, a Bill of Sale listing all of
the Purchased Assets.
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2. Representations and Warranties of Seller. Seller is the duly appointed and qualified
Chapter 7 Trustee for Natty Greene’s Brewing Company, LLC, and as such the Trustee is selling
all of the Purchase Assets without representation or warranty as to their condition.
(a) There are no representations or warranties associated therewith. THE EXECUTION,
DELIVERY AND PERFORMANCE BY SELLER OF THIS AGREEMENT REQUIRES NO ACTION BY, OR
FILING WITH, ANY GOVERNMENTAL BODY, AGENCY OR OFFICIAL, OTHER THAN APPROVALS OR
AUTHORIZATIONS BY THE BANKRUPTCY COURT. SUBJECT TO THE REPRESENTATIONS AND
WARRANTIES CONTAINED IN THIS AGREEMENT, THE PURCHASED ASSETS ARE BEING SOLD “AS
IS” AND “WHERE IS,” AND PURCHASER, OR ULTIMATE HIGHEST BIDDER, HEREBY
ACKNOWLEDGES AND AGREES THAT, EXCEPT AS OTHERWISE EXPRESSLY PROVIDED HEREIN,
SELLER MAKES NO REPRESENTATIONS OR WARRANTIES WHATSOEVER, EXPRESS OR IMPLIED,
WITH RESPECT TO ANY MATTER RELATING TO THE PURCHASE ASSETS. WITHOUT IN ANY WAY
LIMITING THE FOREGOING, SELLER HEREBY DISCLAIMS ANY WARRANTY, EXPRESSED OR
IMPLIED, OF MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE AS TO ANY
PORTION OF THE PURCHASED ASSETS. PURCHASER AND/OR ANY ULTIMATE HIGHEST BIDDER
FURTHER ACKNOWLEDGES THAT IT HAS CONDUCTED AN INDEPENDENT INSPECTION AND
INVESTIGATION OF THE PHYSICAL CONDITION OF THE PURCHASED ASSETS AND ALL SUCH
MATTERS RELATING TO OR AFFECTING THE PURCHASED ASSETS AS AID PARTY DEEMS
NECESSARY OR APPROPRIATE TO THE EXTENT THAT THEY DESIRE SUCH. PURCHASER WILL
ACCEPT THE PURCHASED ASSETS AT CLOSING “AS IS” AND “WHERE IS.”
(b) The Trustee does warrant, represent, that the Trustee shall file the appropriate
11 U.S.C. § 363 pleadings with the United States Bankruptcy Court so as to obtain an Order
approving this Sale which among of things will (i) pre-approve the initial bid of $185,000.00; (ii)
approve the sale procedures as hereinafter set forth; (iii) present to the Court, at the Confirmation
Hearing, that all required court procedures have been followed so as to allow for the Closing and
allow Closing Purchaser to be deemed a good-faith Purchaser who did not improperly collude
with other bidders as those terms are used in 11 U.S.C. § 363(m) and 363(n).
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3. Representations and Warranties of Purchaser. Purchaser represents and
warrants to Seller as follows:
(a) Organization. Purchaser is a corporation duly organized, validly existing and in
good standing under the laws of the State of South Carolina.
(b) Corporate Authorization. The execution, delivery and performance by Purchaser of
this Agreement and the consummation of the Transactions are within the corporate powers of
Purchaser and have been duly authorized by all necessary action on the part of Purchaser. This
Agreement has been duly executed and delivered by Purchaser and, subject to entry by the
Bankruptcy Court of the Sale Approval Order in the Bankruptcy Case, this Agreement constitutes
a valid and binding agreement of Purchaser that is enforceable in accordance with its terms.
(c) No Conflicts. The execution, delivery and performance of this Agreement by
Purchaser will not (i) violate any provision of any existing law, statute, rule, regulation or ordinance,
or (ii) conflict with, result in a breach of, or constitute a default under (A) the certificate or articles of
incorporation or by-laws of Purchaser, (B) any order, judgment, award or decree of any court,
governmental authority, bureau or agency, or (C) any mortgage, indenture, lease, contract or other
agreement or undertaking to which Purchaser is a party or by which Purchaser or any of its properties
or assets may be bound.
(d) Governmental Authorization. The execution, delivery and performance by
Purchaser of this Agreement require no action by, or filing with, any governmental body, agency
or official other than approvals or authorizations by the Bankruptcy Court.
(e) Litigation. As of the date hereof, there is no action, suit, investigation or proceeding
pending against or, to the knowledge of Purchaser, threatened against or affecting Purchaser before
any court or arbitrator or any governmental body, agency or official, which in any manner
challenges or seeks to prevent, enjoin, alter, or materially delay the Transactions.
(f) Certain Fees. Purchaser has not employed any broker, finder, investment banker,
or other intermediary or incurred any liability for any investment banking fees, financial advisory
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fees, brokerage fees, finders’ fees, or other similar fees in connection with this Agreement or the
Transactions.
(g) No Financing Contingency. Purchaser represents that the Transactions
contemplated in this Agreement are not contingent upon Purchaser obtaining financing, and
Purchaser is prepared to pay the Purchase Price in a timely manner as contemplated and set out in
the Auction and Sale Procedures Order.
4. Covenants of Purchaser and Seller. Purchaser and Seller agree that:
(a) Efforts; Further Assurances. Purchaser and Seller will use commercially
reasonable efforts to take all actions and to do all things necessary or desirable under applicable
laws and regulations to consummate the Transactions. Seller and Purchaser agree to execute and
deliver such other documents, certificates, agreements, and other writings and to take such other
actions as may be necessary or desirable in order to vest in Purchaser good title to the Purchased
Assets.
(b) Notices. If (i) Purchaser becomes aware of any material breach by Seller of any
representation, warranty, covenant or agreement contained herein and such breach is capable of
being cured by Seller, or (ii) Seller becomes aware of any material breach by Purchaser of any
representation, warranty, covenant or agreement contained herein and such breach is capable of
being cured by Purchaser, the party becoming aware of such breach shall promptly notify the other
party in writing, in accordance with Section 10.1 of this Agreement. Upon such notice of breach,
the breaching party shall have ten (10) days to cure such breach prior to the exercise of any
remedies in connection therewith.
5. Auction and Sales Procedures. Trustee will request the following Auction Procedures
related to the submission and consideration of competing offers (upset bids) be approved by the
Bankruptcy Court with the entry of an Auction Procedures Order approving the Asset Purchase
Agreement and the Auction Procedures are as follows:
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(a) Sale Means. The Auction Sale shall be an absolute auction subject only to
confirmation by the Court at the final hearing that the Sale and Auction Procedures Order was
followed and that an Acceptable Bidder was the Highest Bidder. The Auction shall be an online
auction with the following auction methods:
(i) Use of online bidding portal that accepts bids only from qualified bidders.
(ii) Auction information posted on the Auctioneers website and if available
other related sites.
(iii) Bidding will start on March 11th, 2021, or such other date as set by the
Court. Initial bid is the Stalking Horse bid and will accept upsets bids in an
amount equal to or in excess of acceptable upset bid amount.
(iv) Parallel zoom or equivalent conferencing video will be made available to
encourage bidding.
(v) Initial bidding will start at 1:00 pm, at 2:00 the automatic extension period
will begin. The automatic extension will be 30 minutes after an acceptable
bid is received to allow additional bidding before the bidding is closed. The
auctioneer in consultation with the Trustee reserves the right to modify the
extension period. If the period is modified it will be announce and apply to
all new bids going forward.
(b) Time and Date of Auction. The auction sale shall take place at 1:00 o’clock on the
11th day of March, 2021, or at a time as set by the Bankruptcy Court.
(c) Location. The Auction shall take place at such location and/or through
teleconferencing as deemed necessary by the Court approved auctioneer.
(d) Acceptable Bidder. An Acceptable Bidder is a party who has provided all of the
following on or before 4:00 p.m. four days prior to Date of Auction:
(i) A Party who executes an Acceptable Upset Bid (an “Acceptable Upset
Bid”) for all the Purchased Assets on the same terms as set out in the Asset Purchase Agreement
in an amount equal to the Acceptable Opening Bid plus the sum of $10,000.00 per the breakup
fees and $1,000.00. Said Initial Acceptable Bid therefore must equal or exceeded $196,000.00.
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(ii) A cash deposit in the amount of $25,000.00 (“Acceptable Bidder Deposit”).
The Trustee shall deposit said funds in a separate bank account which may include the Trust
account for the Trustees’ attorneys, Ivey, McClellan, Gatton & Siegmund. The Trustee shall cause
all deposits to be returned within three (3) business days following the Auction Sale if said
depositor is not the Highest Bidder. The deposit shall be returned by first-class mail to the address
and entity which the Acceptable Bidder in writing has instructed the attorney the Trustee to return
the deposit. If an Acceptable Bidder desires that the deposit be return by wire transfer, then said
instructions for said wire transfer shall be provided to Trustee upon submission of the deposit.
Failure of the Acceptable Bidder to provide proper instructions for the return of deposit will
authorize Trustee to hold said deposit pending written instructions.
(iii) An executed Asset Purchase Agreement including terms that are
substantially similar to, and no less favorable to the Seller than, the Asset Purchase Agreement and
is a firm offer not containing any contingencies to the validity, effectiveness or binding nature of
the offer, including, without limitation, contingencies for financing, due diligence, or inspection.
(iv) Evidence establishing, to the Trustee’s satisfaction, such prospective
bidder’s financial ability to consummate the sale in a timely manner if such bidder becomes the
Highest Bidder at the Auction Sale.
5.2. Acceptable Bidder Access. Auctioneer shall arrange and coordinate with the Trustee to
provide any party who appears to be able to qualify as an Acceptable Qualifying Bidder access to
the location to physically review the Purchased Assets.
5.3. Acceptable Bidder Name. The Trustee shall promptly provide to the Initial Purchaser,
the United States Bankruptcy Administrator, existing Acceptable Bidder, and any secured creditor
who has requested notification in writing (or their counsel if they have appeared through counsel),
the name of each Acceptable Bidder.
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5.4. Acceptable Bidder Per Se. Initial Purchaser shall be deemed to be an Acceptable Bidder
based upon its execution of the Asset Purchase Agreement.
5.5. Acceptable Opening Bid. The Acceptable Opening Bid shall be deemed to be made by
Initial Purchaser upon the terms and conditions set forth in the Asset Purchase Agreement shall be
deemed to be an Acceptable Bidder.
6. Acceptable Upset Bids. At the Auction Sale, an Acceptable Upset Bid may be made by any
Acceptable Bidder. The first Acceptable Upset Bid must be in an amount equal to or greater than
$196,000.00. Thereafter, Acceptable Upset Bids must exceed the previous Acceptable Upset Bid by
an amount equal to or greater than $1,000.00. An Acceptable Upset Bid must be a bid to purchase all
the Purchased Assets under the terms and conditions set forth in the Asset Purchase Agreement as
approved by the Court. The ultimate highest bidder shall be referred to herein as the “Highest Bidder”
and its bid the “Highest Upset Bid.”
7. Acceptable Bidder Dispute Resolution. The Bankruptcy Court shall hold a hearing within
five (5) calendar days, or at such time deemed appropriate by the Bankruptcy Court, in advance of
the auction date to hear and resolve any dispute which may exist between a prospective Acceptable
Bidder and the Seller as to whether said prospective Acceptable Bidder should be designated an
Acceptable Bidder. The Court retains the jurisdiction to determine such other times and dates as it
deems appropriate to hear any dispute relative to a prospective Acceptable Bidder, and said hearing
may be held upon an emergency notice as deemed appropriate in the sole discretion of the Court.
8. How to Make an Upset Bid. A valid Acceptable Upset Bid may be made only by a person
who satisfies the conditions set forth in the Auction and Sales Procedures Order to qualify as an
Acceptable Bidder.
9. Irrevocable Nature of Bids. The Acceptable Upset Bid made by the Highest Bidder shall
remain open and be irrevocable through the Final Hearing and, if the Highest Bid is determined at
such hearing to be approved as the final Acceptable Bid, the Highest Bid shall remain open and be
irrevocable through the date of closing.
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10. Finality of Auction Process. The Acceptable Upset Bid of the Highest Bidder is not subject
to any upset bid after the close of the Action Sale or at the Final Hearing.
11. Procedures if No Acceptable Upset Bid is Received. If no Acceptable Upset Bid is
received, then the Acceptable Opening Bid by Initial Purchaser shall be deemed the highest and best
offer for the Purchased Assets and shall therefore be submitted for approval by the Court at the Final
Hearing.
12. Highest Bidder Deposit. The Highest Bidder shall cause to be deposited with the Seller an
amount in addition to its Acceptable Bidder Deposit such that the total amount of such deposit is equal
to twenty-four percent (24%) of the Highest Bid (the “Highest Bidder Deposit”); provided, however,
that if Initial Purchaser makes the Highest Bid, it shall not be required to make the Highest Bidder
Deposit. The Highest Bidder Deposit shall be submitted to and shall represent good funds on deposit
with the Seller on or before Noon of the first business day following the Auction Sale.
13. Court Hearings.
(a) Initial Sale Hearing. An initial sale hearing is requested to be held by the Court which
will approve the sale of the Purchased Assets, the requested Auction Procedures (including, without
limitation, the Breakup Fee), deem Initial Purchaser as an Acceptable Bidder, and deem Initial
Purchaser’s bid as the Acceptable Opening Bid.
(b) Final Hearing/Confirmation Hearing. A final hearing will be held three (3) business
days after the Auction Sale or as soon thereafter as can be scheduled by the Court. It shall be the
purpose of said hearing to confirm that the procedures as set forth in the Auction and Sales Procedures
Order have been followed by the Seller and the Auction Sale conducted in accordance with the same,
and to make such findings as are necessary to provide the purchaser with proper title in accordance
with the terms and conditions of the Asset Purchase Agreement and the Sale Approval Order. This
hearing shall hereinafter be referred to as the “Final Hearing.”
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14. Closing Date. The closing date shall be deemed to be the date upon which the consideration
is paid and all closing documents are signed. This may take place immediately after the entry of the
Sale Approval Order but must occur within five (5) business days of the entry of the Sale Approval
Order.
15. Failure of Highest Bidder to Close. If the Highest Bidder should fail to close on the
Closing Date on the purchase of the Purchased Assets in accordance with the Highest Bid, and only
in such event:
(a) The Highest Bidder Deposit shall be forfeited to the Seller on account of damages
suffered by the Seller as a result of such failure by the Highest Bidder to close, without prejudice to
the Seller’s ability to seek to recover additional damages from the Highest Bidder;
(b) The Seller shall hold a new Auction Sale (the “New Auction Sale”) of the Purchased
Assets upon three (3) business days’ notice to all entities previously determined to be Acceptable
Bidders of the time selected by the Seller for the New Auction Sale;
(c) An entity that was not previously determined to be an Acceptable Bidder shall not
have the opportunity to become an Acceptable Bidder, previously approved Acceptable Bidder shall
be deemed to be an Acceptable Bidder, without having to provide additional Acceptable Bidder
Deposit, for the New Auction Sale;
(d) If a New Auction Sale is scheduled by the Seller, all Acceptable Bidders that wish to
participate in the New Auction Sale must make the Acceptable Bidder Deposit as provided in this
Motion no later than 4:00 p.m. of the business day immediately prior to the commencement of the
New Auction Sale, and such deposit shall be subject to return as provided in paragraph 5(d)(i), and if
an Acceptable Bidder fails to timely make this Acceptable Bidder Deposit, such entity shall no longer
be considered an Acceptable Bidder and shall be disqualified from participation in the New Auction
Sale;
(e) If a New Auction Sale is scheduled by the Seller, the Highest Bidder from the Initial
Auction Sale shall not be an Acceptable Bidder and shall be disqualified from participation in the
New Auction Sale; and
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(f) If a New Auction Sale is scheduled by the Seller and, if at the time scheduled for the
New Auction Sale the sole Acceptable Bidder is Initial Purchaser, then the New Auction Sale shall
not be held and the Acceptable Opening Bid shall be deemed to be the only bid for the Purchased
Assets and the Seller shall request confirmation of the Acceptable Opening Bid in the Sale Approval
Order.
16. Payment of Breakup Fee. If the Purchased Assets are sold to an Acceptable Bidder for a
price in excess of the Acceptable Opening Bid, then at the closing of such sale, the Seller shall pay
$10,000.00 Breakup Fee in cash at Closing to the Initial Purchaser. However, if Initial Purchaser is
the purchaser of the Purchased Assets at a price in excess of the Acceptable Opening Bid, then Initial
Purchaser will be required to pay the actual amount represented by the Acceptable Highest Bid.
17. Absolute Sale. The Auction Sale shall be an absolute sale and not subject to upset bid after
the Auction Sale. Cause exists to allow for the Court, pursuant to Bankruptcy Rule 6004(h), to
authorize the Seller to close the sale of the Purchased Assets immediately upon entry of the Sale
Approval Order.
18. Necessary Findings for Purchaser. A sale conducted pursuant to the procedures set forth
herein shall result in the Purchased Assets being sold to the Highest Bidder as a good-faith purchaser.
Initial Purchaser shall acquire all rights as can be conveyed pursuant to 11 U.S.C. § 363 including,
but not limited to, the rights of a good faith purchaser pursuant to 11 U.S.C. § 363(m), and a finding,
based upon the sworn representation of the Highest Bidder that the bidding was not pursuant to any
improper collusive bidding practices, which would not allow for the sale to be avoided for reasons
which would include 11 U.S.C. § 363(n).
19. Dispute Resolution. The United States Bankruptcy Court for the Middle District of North
Carolina (“Bankruptcy Court”) shall retain exclusive jurisdiction to resolve any disputes which may
arise concerning the Auction Procedures or other issues relevant to the sale of the Purchased Assets
as outlined herein. All parties to this Agreement shall expressly stipulate and mutually agree that
disputes arising under this Agreement, and the issues presented in any hearing or proceeding
concerning the same, are deemed “core” within the meaning of 28 U.S.C. § 157(b). To any extent
Case 20-10801 Doc 25 Filed 02/05/21 Page 25 of 44
otherwise, the parties nonetheless do hereby knowingly and voluntarily consent to the Bankruptcy
Court having jurisdiction and authority to enter final judgment in any/all core and non-core matters.
20. Business Judgment. The Seller may exercise its reasonable business judgment in conducting
the Auction Sale and in allowing a reasonable time for bids by Acceptable Bidders once the Auction
Sale has commenced; however, it is intended that once commenced, the Auction Sale shall proceed
to its conclusion without being continued to a subsequent day, and the Seller may determine in its
business judgment when to close the Auction Sale, declare the Highest Bid, and preclude further bids.
The Seller may exercise its reasonable business judgment to recommend to the Court the Highest Bid.
21. Emergency Court Hearing with Notice and Hearing. The Auction Procedures Order shall
authorize the Court to hold emergency hearings to resolve any disputes that may rise prior to the
auction. These emergency hearings would include, but not be limited to, any hearing as to whether a
party should be designated as an Acceptable Bidder. All such emergency hearings shall be held on
Notice and Hearing as determined by the Court to be necessary under the circumstances and may
include limited notice and/or telephonic notice to the designated parties. Where deemed necessary,
the Auction and Sales Procedures Order shall allow for ex parte orders to be issued by the Court to
aid and assist in the consummation of this Sale.
22. Auctioneer. The Auction Sale shall be conducted by Iron Horse Auction Company and
shall be paid in accordance with the allocation as indicated in Paragraph 5 above.
23. Tax Matters/Proration. Any ad valorem, use, real, personal and intangible property and
any similar taxes related to, imposed upon or assessed directly against the Purchased Assets will
be remitted to the collecting authorities by Seller if the same are due and payable on or before the
Closing Date, and by Purchaser if due and payable thereafter; provided, however, that such taxes
imposed upon or assessed directly against any Purchased Asset for the tax year in which the
Closing Date occurs (the “Proration Period”) will be apportioned and prorated between Seller and
Purchaser, on and as of the Closing Date, with Purchaser bearing the expense of Purchaser’s
proportionate share of such taxes which shall be equal to the product obtained by multiplying a
fraction, the numerator being the amount of the taxes and the denominator being the total number
Case 20-10801 Doc 25 Filed 02/05/21 Page 26 of 44
of days in the Proration Period, by the number of days in the Proration Period following the Closing
Date, and Seller shall bear the remaining portion of such taxes, and promptly pay over to Purchaser
the amount thereof upon Purchaser’s request. The provisions of this Section ____ shall survive
the Closing and the consummation of the Transactions hereunder.
24. Employee Matters. Purchaser is not obligated to hire any employee of the Debtor
Corporation. Purchaser may hire such former employee of the Debtor Corporation as Purchaser
may choose in its sole and absolute discretion and may set its own initial terms and conditions of
employment for such employees, including work rules, benefits, salary, and wage structure, all as
permitted by applicable law.
25.1. Conditions to Obligations of Purchaser and Seller. The obligations of Purchaser and
Seller to consummate the Transactions are subject to the satisfaction of the following conditions:
(a) The Bankruptcy Court shall have entered the Sale Approval Order in the
Bankruptcy Case, authorizing the Transactions and approving this Agreement under Section 363
of the Bankruptcy Code:
(i) Provide that Purchaser is a good faith purchaser pursuant to Section
363(m) of the Bankruptcy Code;
(ii) Waive any stay that would otherwise be applicable pursuant to
Bankruptcy Rules 6004(h) or 6006(d) or any other applicable Rule or Code Sections;
(iii) Provide that the sale of the Purchased Assets shall be free and clear
of all Liens;
(iv) Provide that Purchaser is not a successor to Seller.
(b) No injunction, stay or similar order or decree, issued by any court, tribunal or
governmental entity, shall be in effect that restrains, enjoins, stays or prohibits the consummation
of the Transactions.
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25.2. Conditions to Obligations of Purchaser. The obligation of Purchaser to consummate the
Transactions is subject to the satisfaction (or waiver by Purchaser) of the following further
conditions:
(a) Seller shall have performed in all material respects all of its obligations hereunder
required to be performed by Seller on, or prior to, the Closing Date; and
(b) The representations and warranties of Seller contained in this Agreement shall be
true and correct at, and as of, the Closing Date, as if made at, and as of, the Closing Date.
25.3. Conditions to Obligations of Seller. The obligation of Seller to consummate the
Transactions is subject to the satisfaction (or waiver by Seller) of the following further conditions:
(a) Purchaser shall have performed in all material respects all of its obligations
hereunder required to be performed by it at, or prior to, the Closing Date; and
(b) The representations and warranties of Purchaser contained in this Agreement shall
be true and correct at, and as of, the Closing Date as if made at, and as of, the Closing Date.
26.1. Grounds for Termination. This Agreement shall terminate upon entry of the Sale
Approval Order and without further action by the parties if Initial Purchaser is not the Highest
Bidder:
(i) By mutual written agreement of Seller and Purchaser; provided, however,
if such written agreement is entered into subsequent to the entry of the Auction and Sales
Procedures Order, termination pursuant to this Section shall require approval of the Bankruptcy
Court;
(ii) By Purchaser, at any time prior to the entry of the Auction and Sales
Procedures Order, if any material condition set forth in this Agreement has not been satisfied, and
such condition is incapable of being satisfied, unless Purchaser elects to waive such satisfaction;
(iii) By Seller, if any material condition set forth in this Agreement has not been
satisfied, and such condition is incapable of being satisfied, unless Seller shall waive such
satisfaction; or
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(iv) By Purchaser, if the Sale Approval Order is not entered by the Bankruptcy
Court on or before ___________.
26.2. Notice of Termination. The party desiring to terminate this Agreement pursuant to this
Section shall give notice of such termination to the other party in accordance with Section10.1.
26.3. Effect of Termination. If this Agreement is terminated as permitted, herein such
termination shall be without liability of any party.
26.4. Expenses of Termination. All costs and expenses incurred in connection with this
Agreement shall be paid by the party incurring such cost or expense.
27. Executory Contracts. There are no Executory Contracts which are being assumed and
assigned under this Agreement including but, not limited to, the lease of premises. Any Purchaser
shall independently make such arrangements with the Landlord for the leasing of the property.
Upon information and belief, the Initial Purchaser has made such arrangements with Brown
Investment Properties, Inc., the Lessor agent. Upon further information and belief, the landlord is
willing to enter into a lease for continued operations of these facilities upon the terms and
conditions set forth in Exhibit “B” hereto. However, the landlord retains the sole and absolute right
to determine the credit worthiness of any Purchaser before entering into said lease. Any Purchaser
therefore should take all such actions as it deems just necessary to make such arrangements
with the landlord as it deems to be appropriate herein. As indicated the Trustee is not in a
position to assist in this process.
28. Miscellaneous.
(a) Notices. All notices, requests and other communications to any party
hereunder shall be in writing (including facsimile transmission) and shall be given,
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If to Purchaser, to:
Scott Lambert
PO Box 5250
Columbia, SC 29250
If to Seller, to:
Charles M. Ivey, III
Chapter 7 Trustee
Ivey, McClellan, Gatton & Siegmund
100 South Elm Street, Suite 500
Greensboro, NC 27401
All such notices, requests and other communications shall be deemed received on the date of
receipt by the recipient thereof if received prior to 5:00 p.m. in the place of receipt and such day
is a business day in the place of receipt. Otherwise, any such notice, request or communication
shall be deemed not to have been received until the next succeeding business day in the place of
receipt.
(b) Waivers. No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other right, power or privilege.
The rights and remedies herein provided shall be cumulative and not exclusive of any rights or
remedies provided by law.
(c) Successors and Assigns. The provisions of this Agreement shall be binding upon
and inure to the benefit of the parties and their respective successors and assigns. Seller
acknowledges that Purchaser may assign its rights under this Agreement to an entity to be formed,
however, such assignment shall not release Purchaser from its obligations hereunder.
(d) Governing Law. This Agreement shall be governed by and construed in accordance
with the internal laws of the State of North Carolina and any applicable provisions of the
Bankruptcy Code, without regard to the principles of conflicts of law that would provide for
application of another law.
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(e) Entire Agreement; Amendments; Counterparts. This Agreement sets forth the
entire agreement between the parties with respect to the subject matter hereof and may be amended
only by a writing executed by Purchaser and Seller. This Agreement may be executed in
counterparts, each of which shall constitute an original and both of which, taken together, shall
constitute one and the same instrument. This Agreement shall become effective when each party
hereto shall have received a counterpart hereof signed by the other party hereto.
(f) Captions; Headings; Interpretation. The captions herein are included for
convenience of reference only and shall be ignored in the construction or interpretation hereof.
The headings contained in this Agreement are for convenience of reference only and shall not
affect the meaning or interpretation of this Agreement. Whenever the words “include,” “includes”
or “including” are used in this Agreement, they shall be deemed to be followed by the words
“without limitation.” In the event an ambiguity or question of intent or interpretation arises, this
Agreement shall be construed as if drafted jointly by the parties and no presumption or burden of
proof shall arise favoring or disfavoring any party by virtue of authorship of any provisions of this
Agreement.
(g) Further Assurances. Each party shall, upon the reasonable request of the other
party, execute and deliver such additional documents and take such further actions as may be
necessary or desirable to consummate the transactions described herein and better vest unto
Purchaser title in and to the Purchased Assets. The provisions of this Section shall survive the
Closing and the consummation of the Transactions hereunder.
(h) Retention of Jurisdiction. Any and all disputes, disagreements, interpretations or
other matters concerning the final consummation and enforcement of this Agreement shall be and
remain in the exclusive jurisdiction of the Bankruptcy Court and, as a result thereof, any pleadings,
causes of action or other requests for relief must be brought before said Court by the party seeking
such relief.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first above written.
Charles M. Ivey, III, Trustee for Natty Greene’s
Brewing Company, LLC.
(Seller)
By: ________________________________
Name:______________________________
Title:_______________________________
____________________________________
(Purchaser)
By: ________________________________
Name:______________________________
Title:______________________________