Opinion
Cases Nos. 01-42217 through 01-42221 (REG), (Jointly Administered).
May 4, 2005
Togut, Segal Segal LLP, Neil Berger (NB-3599), New York, New York, Co-Counsel for Debtors and Debtors-in-Possession.
Weil, Gotshal Manges LLP, Martin J. Bienenstock (MB-3001), Deryck A. Palmer (DP-6351), New York, NY, Counsel for Debtors and Debtors-in-Possession.
Upon the motion (the "Motion") of Ames Department Stores, Inc. ("Ames") and its affiliated above-captioned debtors and debtors in possession (the "Debtors") for an order, pursuant to sections 363 and 1146(c) of Title 11 of the United States Code (the "Bankruptcy Code"), and Rules 2002 and 6004 of the Federal Rules of Bankruptcy Procedure (the "Bankruptcy Rules"), approving and authorizing: (i) the sale to Northeastern Vermont Regional Corp ("NVR") of Ames' right, title and interest in certain commercial real property (all as identified in the Purchase Agreement (as defined herein) and collectively defined as the "Property") located in St. Johnsbury, Vermont, pursuant to the terms of the Agreement for Purchase and Sale of Real Estate dated as of March 31, 2005 (the "Purchase Agreement", a copy of which is annexed hereto as Exhibit "A") by and between Ames and NVR, free and clear of all obligations, liens, judgments, claims, encumbrances, and other interests, including, without limitation, real estate taxes, assessments and governmental imposition liens of any and every nature against the Debtors or the Property (collectively, "Liens"), with any such Liens attaching to the proceeds of the sale; and an auction (the "Auction") of the Property having been scheduled for and conducted and closed on May 3, 2005 at 10:10 a.m. pursuant to this Court's Order: (i) scheduling a hearing to consider the Debtors' sale of certain commercial real property located in St. Johnsbury, Vermont; (ii) scheduling an auction for the property; (iii) approving bidding procedures; and (iv) approving the form and manner of notice of the auction and hearing, dated April 14, 2005 (the "Scheduling Order"); and there having been no bids received for the Property in accordance with the provisions of the Scheduling Order; and a hearing to consider the Motion (the "Sale Hearing") having been held before this Court on May 4, 2005 in accordance with the terms of the Scheduling Order; and no objections to the relief sought in the Motion being interposed; and upon the Motion and the record of the Sale Hearing; and for good cause, it is
HEREBY FOUND THAT:
1. Good and sufficient notice of the Motion, the Auction and the Sale Hearing was given by the Debtors in accordance with the terms of the Scheduling Order. A reasonable opportunity to bid, object or to be heard and to participate at the Auction and the Sale Hearing has been afforded to all interested parties and entities. No competing bids were received for the Property.
2. The terms of the Purchase Agreement were negotiated at arm's length by Ames and NVR.
3. NVR is purchasing the Property in good faith and has acted in good faith within the meaning of section 363(m) of the Bankruptcy Code. As such, NVR is a good faith purchaser under section 363(m) of the Bankruptcy Code, is entitled to the protections of section 363(m) of the Bankruptcy Code and if NVR consummates the sale of the Property, then, absent a stay, the reversal or modification on appeal of this Order or any other authorization of the sale shall not affect the validity of the sale of the Property to NVR.
4. The terms of the Purchase Agreement are fair and reasonable and reflect the Debtors' prudent business judgment under the relevant circumstances.
5. The sale contemplated pursuant to the Purchase Agreement is in the best interests of the Debtors, their estates, their creditors, and all parties in interest.
6. The offer to purchase the Property for $52,800 as set forth in the Purchase Agreement is the highest and best offer for the purchase of the Property that was received by the Debtors.
7. This Court has core jurisdiction over these proceedings and the parties and the Property pursuant to 28 U.S.C. §§ 157(b) and 1334. The Motion is a core proceeding pursuant to 28 U.S.C. § 157(b)(2).
8. The Debtors have satisfied the requirements of section 363(f) of the Bankruptcy Code. The sale and transfer of the Property to NVR will, pursuant to section 363(f) of the Bankruptcy Code, vest NVR with all right, title and interest of the Debtors in and to the Property free and clear of all Liens.
ORDERED as follows:
A. The Motion is granted.
B. Pursuant to section 363(b) of the Bankruptcy Code, the Purchase Agreement and the transactions contemplated thereby are approved, and the Debtors are hereby authorized to sell the Property to NVR pursuant to the terms of the Purchase Agreement.
C. Except for Permitted Exceptions (as defined in the Purchase Agreement), pursuant to sections 363(b) and (f) of the Bankruptcy Code, the Property shall be conveyed free and clear of all Liens, with all such Liens to attach to the net proceeds of the sale of the Property with the same force, validity, effect, priority and enforceability as such Liens had against the Property.
D. All persons and entities holding Liens of any kind and nature with respect to the Property are hereby barred from asserting such Liens of any kind or nature against NVR, its successors or assigns, or the Property.
E. If any person or entity that has filed financing statements, mortgages, mechanics liens, lis pendens, or other documents or agreements evidencing Liens against the Property shall not have delivered to the Debtors prior to the Closing Date (as defined in the Purchase Agreement), in proper form for filing and executed by the appropriate parties, termination statements, instruments of satisfaction or releases of all Liens the person or entity has with respect to the Debtors or the Property, then (a) the Debtors are hereby authorized to and directed to execute and file such statements, instruments, releases, and other documents on behalf of the person or entity, and (b) NVR is hereby authorized to file, register, or otherwise record a certified copy of this Order, which shall constitute conclusive evidence of the release of all Liens against the Property of any kind or nature whatsoever. Notwithstanding the foregoing, the failure of the Debtors or NVR to undertake the foregoing, shall in no way limit the release, discharge and termination of any Lien as provided in this Order.
F. The Debtors and NVR are authorized to take all actions and execute all documents necessary or appropriate to consummate the sale of the Property to NVR and any related transactions as set forth in the Purchase Agreement.
G. Pursuant to section 1146(c) of the Bankruptcy Code, the sale of the Property to NVR pursuant to the Purchase Agreement and this Order shall be exempt from any state and local stamp or similar transfer taxes and the making, delivery, or recordation of any and all instruments to evidence the sale and transfer shall not be subject to transfer, recordation, stamp or similar tax imposed by a taxing authority (a "Taxing Authority"). Each and every Taxing Authority is hereby directed to accept and file any and all documents and instruments necessary or appropriate to consummate the transfer and sale or assumption and assignment of the Property contemplated by this Order and all such filings shall be without the imposition of any stamp tax or sales, use, transfer, duty, value added, or any other similar tax, pursuant to section 1146(c) of the Bankruptcy Code. Notwithstanding the foregoing, any taxes due, arising from or related to the sale of the Property, or incurred, accrued or arising prior to the Closing Date (as defined in the Purchase Agreement) shall be the liability of the Debtors.
H. The registrars or recorders of deeds (or other similar recording agency) in their respective jurisdictions are hereby directed to accept this Order, as sole and sufficient evidence of the transfer of title of the Property.
I. NVR is a good faith purchaser under section 363(m) of the Bankruptcy Code and is entitled to all of the protections afforded in and by section 363(m) of the Bankruptcy Code.
J. This Court shall retain jurisdiction to enforce, interpret and implement the terms of the Purchase Agreement and this Order.
K. This Order shall be effective and enforceable immediately upon entry and shall not be stayed pursuant to Bankruptcy Rule 6004(g).