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26761944.1
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
------------------------------------------------------------ x
In re: : Chapter 11
:
CHISHOLM OIL AND GAS OPERATING, : Case No. 20-11593 (BLS)
LLC, et al., :
Debtors.1 : (Jointly Administered)
------------------------------------------------------------ x Re: Docket Nos. 9 and 61
CERTIFICATION OF COUNSEL REGARDING REVISED FINAL ORDER PURSUANT
TO 11 U.S.C. §§ 105(a) AND 363(b) AND FED. R. BANKR. P. 6003 AND 6004
(I) AUTHORIZING DEBTORS TO PAY OR HONOR (A) AMOUNTS OWED TO
INTEREST OWNERS, (B) JOINT INTEREST BILLINGS, AND (C) OTHER
OPERATING EXPENSES AND (II) GRANTING RELATED RELIEF
On June 18, 2020, the above-captioned affiliated debtors and debtors-in-possession
(collectively, the “Debtors”), filed the Motion of Debtors Pursuant to 11 U.S.C. §§ 105(a) and
363(b) and Fed. R. Bankr. P. 6003 and 6004 for Entry of Interim and Final Orders (I) Authorizing
Debtors to Pay or Honor (A) Amounts Owed to Interest Owners, (B) Joint Interest Billings, and
(C) Other Operating Expenses and (II) Granting Related Relief [Docket No. 9] (the “Motion”).2
On June 19, 2020, the Court entered an order approving the Motion on an interim
basis [Docket No. 61] (the “Interim Order”). Pursuant to the Interim Order, objections to the
Proposed Final Order were to be filed and served by 4:00 p.m. (ET) on July 9, 2020 (the
“Objection Deadline”).
The Debtors received informal comments to the Proposed Final Order from the
Official Committee of Unsecured Creditors (the “Committee”), which have been resolved as
reflected in the revised Proposed Final Order attached hereto as Exhibit A (the “Revised Final
1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification
number, as applicable, are Chisholm Oil and Gas Operating II, LLC (8730); Chisholm Oil and Gas Operating, LLC
(5382); Cottonmouth SWD, LLC (9849); Chisholm Oil and Gas Nominee, Inc. (1558); and Chisholm Oil and Gas
Management II, LLC (8174). The Debtors’ mailing address is 1 West Third Street, Suite 1700, Tulsa, OK 74103.
2 Capitalized terms used herein but not otherwise defined shall have the meanings ascribed to them in the Motion.
Case 20-11593-BLS Doc 153 Filed 07/13/20 Page 1 of 2
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Order”).3 No other responses or objections to the Proposed Final Order were filed or otherwise
received prior to the Objection Deadline.
The Debtors have circulated the Revised Final Order to counsel to the Committee
and the RBL Agent and there are no objections to its entry. Accordingly, the Debtors respectfully
request that the Court enter the Revised Final Order at its earliest convenience without further
notice or hearing.
Dated: July 13, 2020
Wilmington, Delaware
/s/ Jaime Luton Chapman
YOUNG CONAWAY STARGATT & TAYLOR, LLP
M. Blake Cleary (No. 3614)
Jaime Luton Chapman (No. 4936)
S. Alexander Faris (No. 6278)
Rodney Square
1000 North King Street
Wilmington, Delaware 19801
Telephone: (302) 571-6600
Facsimile: (302) 571-1253
Emails: [email protected]
-and-
WEIL, GOTSHAL & MANGES LLP
Matthew S. Barr (admitted pro hac vice)
Kelly DiBlasi (admitted pro hac vice)
Lauren Tauro (admitted pro hac vice)
767 Fifth Avenue
New York, New York 10153
Telephone: (212) 310-8000
Facsimile: (212) 310-8007
Proposed Attorneys for Debtors
and Debtors in Possession
3 For the convenience of the Court and other interested parties, a blackline comparing the Revised Final Order against
the Proposed Final Order is attached hereto as Exhibit B.
Case 20-11593-BLS Doc 153 Filed 07/13/20 Page 2 of 2
26761944.1
EXHIBIT A
Revised Final Order
Case 20-11593-BLS Doc 153-1 Filed 07/13/20 Page 1 of 6
26763884.1
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
------------------------------------------------------------ x
In re : Chapter 11
:
CHISHOLM OIL AND GAS OPERATING, : Case No. 20–11593 (BLS)
LLC, et al., :
Debtors.1 : (Jointly Administered)
------------------------------------------------------------ x Re: Docket Nos. 9 and 61
FINAL ORDER PURSUANT TO 11 U.S.C. §§ 105(a) AND 363(b) AND FED.
R. BANKR. P. 6003 AND 6004 (I) AUTHORIZING DEBTORS TO PAY OR HONOR
(A) AMOUNTS OWED TO INTEREST OWNERS, (B) JOINT INTEREST BILLINGS,
AND (C) OTHER OPERATING EXPENSES AND (II) GRANTING RELATED RELIEF
Upon the motion, dated June 18, 2020 (the “Motion”),2 of Chisholm Oil and Gas
Operating, LLC and its debtor affiliates, as debtors and debtors in possession in the above-
captioned chapter 11 cases (collectively, the “Debtors”), for entry of an order pursuant to sections
105(a) and 363(b) of the Bankruptcy Code and Bankruptcy Rules 6003 and 6004 (i) authorizing
the Debtors to pay or honor the Obligations, and (ii) granting related relief, all as more fully set
forth in the Motion; and upon consideration of the Henry Declaration; and this Court having
jurisdiction to consider the Motion and the relief requested therein pursuant to 28 U.S.C. §§ 157
and 1334, and the Amended Standing Order of Reference entered by the United States District
Court for the District of Delaware, dated February 29, 2012; and consideration of the Motion and
the requested relief being a core proceeding pursuant to 28 U.S.C. § 157(b); and venue being
proper before this Court pursuant to 28 U.S.C. §§ 1408 and 1409; and due and proper notice of the
Motion having been provided; and such notice having been adequate and appropriate under the
1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification
number, as applicable, are Chisholm Oil and Gas Operating II, LLC (8730); Chisholm Oil and Gas Operating, LLC
(5382); Cottonmouth SWD, LLC (9849); Chisholm Oil and Gas Nominee, Inc. (1558); and Chisholm Oil and Gas
Management II, LLC (8174). The Debtors’ mailing address is 1 West Third Street, Suite 1700, Tulsa, OK 74103.
2 Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Motion.
Case 20-11593-BLS Doc 153-1 Filed 07/13/20 Page 2 of 6
2
26763884.1
circumstances, and it appearing that no other or further notice need be provided; and this Court
having reviewed the Motion; and this Court having entered an order granting the relief requested
in the Motion on an interim basis; and this Court having held a hearing to consider the relief
requested in the Motion and all objections, if any, to the Motion having been withdrawn, resolved,
or overruled; and upon the record of the hearing; and this Court having determined that the legal
and factual bases set forth in the Motion establish just cause for the relief granted herein; and it
appearing that the relief requested in the Motion is in the best interests of the Debtors, their estates,
creditors, and all parties in interest; and upon all of the proceedings had before this Court and after
due deliberation and sufficient cause appearing therefor,
IT IS HEREBY ORDERED THAT
1. The Motion is granted as set forth herein.
2. The Debtors are authorized, but not directed, pursuant to sections 105(a)
and 363(b) of the Bankruptcy Code, to pay or honor the Obligations.
3. The Debtors shall maintain a matrix or schedule of all amounts delivered or
paid subject to the terms and conditions of this Final Order, which shall include the following
information: (i) the category of amounts delivered or paid as further described and classified in the
Motion and (ii) the aggregate amount of payments by category. The Debtors shall provide a copy
of the matrix or schedule to the U.S. Trustee, counsel to the RBL Agent, and counsel to the official
committee of unsecured creditors appointed in these chapter 11 cases (the “Creditors’
Committee”) on the 45th day following the date of entry of this Final Order and every 30 days
thereafter.
4. Nothing herein shall impair or prejudice the rights of the U.S. Trustee, the
RBL Agent, or the Creditors’ Committee, which are expressly reserved, to object to any payment
Case 20-11593-BLS Doc 153-1 Filed 07/13/20 Page 3 of 6
3
26763884.1
to a claimant that is an insider (as such term is defined in section 101(31) of the Bankruptcy Code),
or an affiliate of an insider, of the Debtors.
5. Any party that accepts payment from the Debtors on account of the
Obligations pursuant to this Final Order shall be deemed to have agreed to the terms and provisions
of this Final Order.
6. The Banks are authorized to receive, process, honor, and pay any and all
checks issued, or to be issued, and electronic funds transfers requested, or to be requested, by the
Debtors relating to such obligations, to the extent that sufficient funds are on deposit and standing
in the Debtors’ credit in the applicable bank accounts to cover such payments. The Banks are
authorized to accept and rely on all representations made by the Debtors with respect to which
checks, drafts, wires, or automated clearing house transfers should be honored or dishonored in
accordance with this or any other order of this Court, whether such checks, drafts, wires, or
transfers are dated prior to, on, or subsequent to the Petition Date, without any duty to inquire
otherwise.
7. The Debtors are authorized, but not directed, to issue new postpetition
checks, or effect new electronic funds transfers, and to replace any prepetition checks or electronic
fund transfer requests that may be lost or dishonored or rejected as a result of the commencement
of the Debtors’ chapter 11 cases with respect to any prepetition amounts that are authorized to be
paid pursuant to this Final Order.
8. If any party accepts payment on account of Obligations under this Final
Order and such Obligations are subsequently recharacterized or otherwise determined to constitute
property of the Debtors’ estates, the Debtors are authorized, but not directed, to avoid such
payment as an unauthorized postpetition transfer under section 549 of the Bankruptcy Code, and
Case 20-11593-BLS Doc 153-1 Filed 07/13/20 Page 4 of 6
4
26763884.1
the party receiving payment on account of the Obligations shall be required to immediately repay
to the Debtors any payment made to it on account of its asserted claim to the extent the aggregate
amount of such payment exceeds the postpetition Obligation then outstanding, without right of
any setoff, claims, provisions for payment of reclamation, trust fund claims, or otherwise. Upon
recovery by the Debtors, the Obligation shall be reinstated as a prepetition claim in the amount so
recovered.
9. The RBL Agent and the Creditors’ Committee each reserves the right to
challenge the propriety of payments made in compliance with this Final Order, and the Debtors
shall offset future Obligations to any recipient against such amounts that are ultimately determined
or agreed to have been improperly paid to the recipient of the payment.
10. Nothing contained in the Motion or this Final Order nor any payment made
pursuant to the authority granted by this Final Order is intended to be or shall be construed as (i) an
admission as to the validity of any claim against the Debtors, (ii) a waiver of the Debtors’ or any
appropriate party in interest’s rights to dispute the amount of, basis for, or validity of any claim
against the Debtors, (iii) a waiver of any claims or causes of action which may exist against any
creditor or interest holder, or (iv) an approval, assumption, adoption, or rejection of any agreement,
contract, lease, program, or policy between the Debtors and an third party under section 365 of the
Bankruptcy Code.
11. Notwithstanding anything to the contrary contained herein, any payment to
be made, or authorization contained, hereunder shall be subject to and in compliance with any
interim or final order entered by this Court (the “Cash Collateral Orders”) approving the
Debtors’ use of cash collateral, including any budgets or cash flow forecasts in connection
Case 20-11593-BLS Doc 153-1 Filed 07/13/20 Page 5 of 6
5
26763884.1
therewith. To the extent there is any conflict between this Final Order and the Cash Collateral
Orders, the terms of the Cash Collateral Orders shall govern.
12. Notice of the Motion is adequate under Bankruptcy Rule 6004(a).
13. Notwithstanding the provisions of Bankruptcy Rule 6004(h), this Final
Order shall be immediately effective and enforceable upon its entry.
14. The Debtors are authorized to take all actions necessary or appropriate to
carry out the relief granted in this Final Order.
15. This Court shall retain jurisdiction to hear and determine all matters arising
from or related to the implementation, interpretation, or enforcement of this Final Order.
Case 20-11593-BLS Doc 153-1 Filed 07/13/20 Page 6 of 6
26761944.1
EXHIBIT B
Blackline
Case 20-11593-BLS Doc 153-2 Filed 07/13/20 Page 1 of 6
26763884.1
IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE
------------------------------------------------------------ x In re : Chapter 11 : CHISHOLM OIL AND GAS OPERATING, : Case No. 20–11593 ( BLS) LLC, et al., : Debtors.1 : (Jointly Administered) ------------------------------------------------------------ x Re: Docket Nos. ____9 and 61
FINAL ORDER PURSUANT TO 11 U.S.C. §§ 105(a) AND 363(b) AND FED. R. BANKR. P. 6003 AND 6004 (I) AUTHORIZING DEBTORS TO PAY OR HONOR
(A) AMOUNTS OWED TO INTEREST OWNERS, (B) JOINT INTEREST BILLINGS, AND (C) OTHER OPERATING EXPENSES AND (II) GRANTING RELATED RELIEF
Upon the motion, dated June 18, 2020 (the “Motion”),2 of Chisholm Oil and Gas
Operating, LLC and its debtor affiliates, as debtors and debtors in possession in the above-
captioned chapter 11 cases (collectively, the “Debtors”), for entry of an order pursuant to sections
105(a) and 363(b) of the Bankruptcy Code and Bankruptcy Rules 6003 and 6004 (i) authorizing
the Debtors to pay or honor the Obligations, and (ii) granting related relief, all as more fully set
forth in the Motion; and upon consideration of the Henry Declaration; and this Court having
jurisdiction to consider the Motion and the relief requested therein pursuant to 28 U.S.C. §§ 157
and 1334, and the Amended Standing Order of Reference entered by the United States District
Court for the District of Delaware, dated February 29, 2012; and consideration of the Motion and
the requested relief being a core proceeding pursuant to 28 U.S.C. § 157(b); and venue being
proper before this Court pursuant to 28 U.S.C. §§ 1408 and 1409; and due and proper notice of the
Motion having been provided; and such notice having been adequate and appropriate under the
1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification number, as applicable, are Chisholm Oil and Gas Operating II, LLC (8730); Chisholm Oil and Gas Operating, LLC (5382); Cottonmouth SWD, LLC (9849); Chisholm Oil and Gas Nominee, Inc. (1558); and Chisholm Oil and Gas Management II, LLC (8174). The Debtors’ mailing address is 1 West Third Street, Suite 1700, Tulsa, OK 74103. 2 Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Motion.
Case 20-11593-BLS Doc 153-2 Filed 07/13/20 Page 2 of 6
2
26763884.1
circumstances, and it appearing that no other or further notice need be provided; and this Court
having reviewed the Motion; and this Court having entered an order granting the relief requested
in the Motion on an interim basis; and this Court having held a hearing to consider the relief
requested in the Motion and all objections, if any, to the Motion having been withdrawn, resolved,
or overruled; and upon the record of the hearing; and this Court having determined that the legal
and factual bases set forth in the Motion establish just cause for the relief granted herein; and it
appearing that the relief requested in the Motion is in the best interests of the Debtors, their estates,
creditors, and all parties in interest; and upon all of the proceedings had before this Court and after
due deliberation and sufficient cause appearing therefor,
IT IS HEREBY ORDERED THAT
1. The Motion is granted as set forth herein.
2. The Debtors are authorized, but not directed, pursuant to sections 105(a)
and 363(b) of the Bankruptcy Code, to pay or honor the Obligations.
3. The Debtors shall maintain a matrix or schedule of all amounts delivered or
paid subject to the terms and conditions of this Final Order, which shall include the following
information: (i) the category of amounts delivered or paid as further described and classified in the
Motion and (ii) the aggregate amount of payments by category. The Debtors shall provide a copy
of the matrix or schedule to the U.S. Trustee, counsel to the RBL Agent, and counsel to the official
committee of unsecured creditors appointed in these chapter 11 cases (the “Creditors’
Committee”) on the 45th day following the date of entry of this Final Order and every 30 days
thereafter.
4. Nothing herein shall impair or prejudice the rights of the U.S. Trustee, the
RBL Agent, or the Creditors’ Committee, which are expressly reserved, to object to any payment
Case 20-11593-BLS Doc 153-2 Filed 07/13/20 Page 3 of 6
3
26763884.1
to a claimant that is an insider (as such term is defined in section 101(31) of the Bankruptcy Code),
or an affiliate of an insider, of the Debtors.
5. Any party that accepts payment from the Debtors on account of the
Obligations pursuant to this Final Order shall be deemed to have agreed to the terms and provisions
of this Final Order.
3.6. The Banks are authorized to receive, process, honor, and pay any and all
checks issued, or to be issued, and electronic funds transfers requested, or to be requested, by the
Debtors relating to such obligations, to the extent that sufficient funds are on deposit and standing
in the Debtors’ credit in the applicable bank accounts to cover such payments. The Banks are
authorized to accept and rely on all representations made by the Debtors with respect to which
checks, drafts, wires, or automated clearing house transfers should be honored or dishonored in
accordance with this or any other order of this Court, whether such checks, drafts, wires, or
transfers are dated prior to, on, or subsequent to the Petition Date, without any duty to inquire
otherwise.
4.7. The Debtors are authorized, but not directed, to issue new postpetition
checks, or effect new electronic funds transfers, and to replace any prepetition checks or electronic
fund transfer requests that may be lost or dishonored or rejected as a result of the commencement
of the Debtors’ chapter 11 cases with respect to any prepetition amounts that are authorized to be
paid pursuant to this Final Order.
5.8. If any party accepts payment on account of Obligations under this Final
Order and such Obligations are subsequently recharacterized or otherwise determined to constitute
property of the Debtors’ estates, the Debtors are authorized, but not directed, to avoid such
payment as an unauthorized postpetition transfer under section 549 of the Bankruptcy Code, and
Case 20-11593-BLS Doc 153-2 Filed 07/13/20 Page 4 of 6
4
26763884.1
the party receiving payment on account of the Obligations shall be required to immediately repay
to the Debtors any payment made to it on account of its asserted claim to the extent the aggregate
amount of such payment exceeds the postpetition Obligation then outstanding, without right of
any setoff, claims, provisions for payment of reclamation, trust fund claims, or otherwise. Upon
recovery by the Debtors, the Obligation shall be reinstated as a prepetition claim in the amount so
recovered.
6.9. The RBL Agent and the Creditors’ Committee each reserves the right to
challenge the propriety of payments made in compliance with this Final Order, and the Debtors
shall offset future Obligations to any recipient against such amounts that are ultimately determined
or agreed to have been improperly paid to the recipient of the payment.
7.10. Nothing contained in the Motion or this Final Order nor any payment made
pursuant to the authority granted by this Final Order is intended to be or shall be construed as (i) an
admission as to the validity of any claim against the Debtors, (ii) a waiver of the Debtors’ or any
appropriate party in interest’s rights to dispute the amount of, basis for, or validity of any claim
against the Debtors, (iii) a waiver of any claims or causes of action which may exist against any
creditor or interest holder, or (iv) an approval, assumption, adoption, or rejection of any agreement,
contract, lease, program, or policy between the Debtors and an third party under section 365 of the
Bankruptcy Code.
8.11. Notwithstanding anything to the contrary contained herein, any payment to
be made, or authorization contained, hereunder shall be subject to and in compliance with any
interim or final order entered by this Court (the “Cash Collateral Orders”) approving the
Debtors’ use of cash collateral, including any budgets or cash flow forecasts in connection
Case 20-11593-BLS Doc 153-2 Filed 07/13/20 Page 5 of 6
5
26763884.1
therewith. To the extent there is any conflict between this Final Order and the Cash Collateral
Orders, the terms of the Cash Collateral Orders shall govern.
9.12. Notice of the Motion is adequate under Bankruptcy Rule 6004(a).
10.13. Notwithstanding the provisions of Bankruptcy Rule 6004(h), this Final
Order shall be immediately effective and enforceable upon its entry.
11.14. The Debtors are authorized to take all actions necessary or appropriate to
carry out the relief granted in this Final Order.
12.15. This Court shall retain jurisdiction to hear and determine all matters arising
from or related to the implementation, interpretation, or enforcement of this Final Order.
Dated: , 2020 Wilmington, Delaware
UNITED STATES BANKRUPTCY JUDGE
Case 20-11593-BLS Doc 153-2 Filed 07/13/20 Page 6 of 6
