SOUTHERN DISTRICT OF NEW YORK TOISA LIMITED, et al.,

UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ---------------------------------------------------------------x : In re: : Chapter 11 : TOISA LIMITED, et al., : Case No. 17-10184 (___) : Debtors.1 : (Joint Administration Pending) : ---------------------------------------------------------------x

DEBTORS’ MOTION FOR INTERIM AND FINAL ORDERS

(I) AUTHORIZING CONTINUED USE OF EXISTING CASH MANAGEMENT PRACTICES, BANK ACCOUNTS, AND BUSINESS FORMS,

(II) WAIVING INVESTMENT AND DEPOSIT REQUIREMENTS, AND (III) AUTHORIZING CONTINUANCE OF INTERCOMPANY TRANSACTIONS

Toisa Limited and certain of its affiliates and subsidiaries, the debtors and

debtors in possession in the above-captioned cases (collectively, the “Debtors” and,

together with their non-Debtor affiliates, the “Company”), hereby apply (this “Motion”)

for entry of an interim order (the “Interim Order”), substantially in the form attached

hereto as Exhibit A, and a final order, substantially in the form of the Interim Order (the

“Final Order” and, together with the Interim Order, the “Orders”) under sections 105,

345, 362, 363, 503, 1107, and 1108 of title 11 of the United States Code (the “Bankruptcy 1 The Debtors are as follows: Trade Prosperity, Inc.; Toisa Limited; United Courage, Inc.; Trade

Vision, Inc.; United Journey, Inc.; United Kalavryta, Inc.; Trade Sky, Inc.; Trade Industrial Development Corporation; United Honor, Inc.; Trade Will, Inc.; United Leadership Inc.; United Seas, Inc.; United Dynamic, Inc.; United Emblem, Inc.; United Ideal Inc.; Trade Unity, Inc.; Trade Quest, Inc.; Trade Spirit, Inc.; Trade Resource, Inc.; United Ambassador, Inc.; Edgewater Offshore Shipping, Ltd.; United Banner, Inc.; Toisa Horizon, Inc.; and Trade and Transport Inc.

TOGUT, SEGAL & SEGAL LLP One Penn Plaza Suite 3335 New York, New York 10119 (212) 594-5000 Albert Togut Frank A. Oswald Brian F. Moore Kyle J. Ortiz Proposed Counsel to the Debtors and Debtors in Possession

17-10184 Doc 8 Filed 01/29/17 Entered 01/29/17 23:27:24 Main Document Pg 1 of 28

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Code”): (a) authorizing, but not directing, the Debtors to continue using their existing

cash management practices (including the continued utilization of non-Debtor affiliate

managing agents, Marine Management Bulk Services Inc. (“MMBS”), Marine

Management Services M.C. (“MMS”), and Sealion Shipping Limited (“Sealion” and,

together with MMBS and MMS, the “Managing Agents”), in accordance with the terms

of those certain agreements by and between the Managing Agents and certain Debtor

Vessel Owners (defined below) (collectively, the “Management Agreements”)), bank

accounts, and business forms; (b) waiving any applicable investment and deposit

requirements; and (c) authorizing the continuance of intercompany transactions and, to

the extent applicable, granting administrative expense status to postpetition

intercompany claims between and among the Debtors pursuant to Bankruptcy Code

section 503(b)(1).

In support of this Motion, the Debtors rely upon and incorporate by reference the

Declaration of Robert Hennebry Pursuant to Local Bankruptcy Rule 1007-2 and in Support of

the Debtors’ Chapter 11 Petitions and First Day Pleadings filed with the Court concurrently

herewith (the “First-Day Declaration”).2 In further support of the Motion, the Debtors,

by and through their undersigned counsel, respectfully represent as follows:

PRELIMINARY STATEMENT3

The Debtors are a leading provider of marine transportation, construction, and

support services to companies in the oil and gas exploration, production, and subsea

construction, as well as subsea fiber optic cable installation industries. The Debtors’

2 Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the First-

Day Declaration. 3 Capitalized terms used but not defined in this Preliminary Statement shall have the meaning ascribed

to such term in the Motion.


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fleet consists of twenty-six (26) offshore vessels, thirteen (13) tankers, and seven (7)

bulkers (collectively, the “Vessels”). The Vessels are owned by various Debtor entities

(collectively, the “Vessel Owners”), including Toisa Limited, which owns twenty-three

(23) of the Company’s twenty-six (26) offshore vessels.

The Debtors’ operations are divided into two segments: (i) dry bulk and tanker

(collectively, the “Oceangoing Segment”); and (ii) offshore shipping (the “Offshore

Segment”). Given the size of the Debtors’ fleet and the complexity of their operations,

the Debtors’ business segments are managed day-to-day by distinct non-Debtor affiliate

Managing Agents, in accordance with the terms and conditions of the Management

Agreements. MMS and MMBS manage the tankers and bulkers, respectively, and

Sealion manages the offshore vessels.

Pursuant to the Management Agreements, the Managing Agents are given

virtually complete control over the hiring, management, payroll, maintenance,

insurance, and chartering of the Vessels they are charged with managing. Specifically,

the Management Agreements contemplate that the Managing Agents can hire all crew,

coordinate services to charters and bankers, appoint agents, etc. The Managing Agents

are also responsible for the Vessels’ books and records and voyage books.

In order to streamline this management process, the Company designed

sophisticated cash management practices (the “Cash Management Practices”) to

facilitate the efficient flow of funds between the Vessel Owners and Managing Agents

(as well as other entities within the Company) to ensure that the Managing Agents can

timely satisfy the Vessel Owners’ operational needs and further the Company’s

corporate purpose.

As described more fully in the First Day Declaration, since the downturn of the

Debtors’ operations in Q3 2016, revenues on account of the Vessel Owners’ charter


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receipts and receivables have been notified to be remitted directly to the accounts of the

Managing Agents, who, in turn, (i) pay the Vessel Owners’ operating expenses as they

come due (including paying the interest on the Company’s funded debt obligations to

the extent such interest is being paid), and (ii) otherwise transfer funds between and

among the Company’s various bank accounts, as needed. Importantly, each and every

deposit, payment, and other transfer pursuant to the Cash Management Practices is

documented and accounted for on both a per Vessel and a per entity basis. These

accounting procedures ensure that: (a) cash flow attributable to the Debtors’ distinct

business segments is not commingled, as each segment has its own Management Agent;

and (b) the proceeds of each Vessel Owners’ charter receivables can be easily traced by

virture of the Debtors’ Cash Management Practices to ensure that any cash (or

corresponding liability) is allocated to the appropriate Vessel and, in turn, Vessel

Owner.

The Cash Management Practices are integral to the stability and efficiency of the

Debtors’ operations, as they ensure charter receivables are easily collected and the

Company’s operating expenses are timely satisfied in a way that minimizes the

Company’s administrative costs. Thus, the preservation of the Cash Management

Practices post-petition, particularly with respect to the Managing Agents, is critical.

Indeed, given the Debtors’ complex internal structure and the unique industry in which

they operate, any loss or interruption of the Managing Agents’ services or the Cash

Management Practices — even temporarily — would immediately halt operation of the

Company, thereby causing irreparable harm not only to the Debtors’ ongoing

operations (and, therefore, to their ability to generate revenue during these cases), but

also to the continued maintenance and care of the Vessels. Such damage would be

detrimental at this critical early stage of the Debtors’ Chapter 11 Cases.


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The Debtors therefore request that the Court authorize them to continue using

their existing Cash Management Practices, which entail the continued use of the

Managing Agents’ services under the Management Agreements, and to continue to

transfer funds into, out of, and through the Company’s Bank Accounts, consistent with

their prepetition Cash Management Practices.

The Debtors further request that they be authorized to implement any changes to

the Cash Management Practices that they deem appropriate in their sole discretion,

including, without limitation, closing Bank Accounts or opening new bank accounts,

subject to the terms and conditions as set forth in the applicable bank account

agreements (“Bank Account Agreements”). As necessary, the Debtors request that the

applicable Banks be authorized and directed to honor the Debtors’ directions with

respect to the opening or closing of any bank account.

The remainder of the Motion requests customary first-day relief, including entry

of Interim and Final Orders: (a) authorizing the Debtors to continue using their existing

Bank Accounts and Business Forms, in each case subject to changes that they may make

thereto in their sole discretion; (b) waiving any applicable investment and deposit

requirements imposed by section 345(b) of the Bankruptcy Code or otherwise; and (c)

authorizing the Debtors to continue their Intercompany Transactions in the ordinary

course of business and, to the extent applicable, granting administrative expense status

to Postpetition Intercompany Claims between and among the Debtors pursuant to

Bankruptcy Code section 503(b)(1). The Debtors also request that the Court schedule a

final hearing on the Motion within forty-five (45) days of the entry of Interim Order.

BACKGROUND

1. The factual background regarding the Debtors is set forth in the First-Day

Declaration. On the date hereof (the “Petition Date”), the Debtors each commenced a


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case by filing a petition for relief under chapter 11 of the Bankruptcy Code (collectively,

the “Chapter 11 Cases”). The Debtors continue to operate their business and manage

their property as debtors in possession pursuant to Bankruptcy Code sections 1107 and

1108. The Debtors have requested joint administration of these Chapter 11 Cases by

motion filed concurrently herewith. No trustee or examiner has been appointed in

these Chapter 11 Cases. As of the date hereof, no creditors’ committee has been

appointed.

A. The Management Agreements

2. In order to effectively and profitably manage the Vessels, the Debtors

entered into Management Agreements with the Managing Agents. For all intents and

purposes, the Managing Agents are in full control of the Vessels’ operations.

3. The Management Agreements can be divided into two categories: (i) the

MMS and MMBS Agreements, which govern the Oceangoing Segment; and (ii) the

Sealion Management Agreement, which governs the Offshore Segment. Set forth below

are summaries of the key terms of these two categories of Management Agreements:

i. The MMS and MMBS Agreements

4. MMS and MMBS operate as the managers of the Debtors’ oceangoing fleet

of tanker and bulkers. In that connection, MMS and MMBS provide chartering

accounting, financial, and legal support on behalf of the Debtors to facilitate the

operations of the Debtors’ thirteen (13) tankers and seven (7) bulkers.

5. Each individual Vessel entered into a Management Agreement with either

MMS or MMBS (depending on the type of Vessel). The terms and conditions of these

agreements are substantially similar, except for the Vessel description and

compensation amount, which differ slightly. Under these Management Agreements,


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the respective Management Agent provides administrative, operational, and ship

management services, including charter negotiations and repair.

6. In return for these services, a daily management fee ranging from $1,500

to $2,000 is paid to MMS and MMBS, as appropriate, which fees are paid monthly.

7. In addition to the daily management fee, MMS and MMBS are entitled to

a 1% commission of the aggregate transaction value of the: (i) disposition of the Vessel;

(2) acquisition of new vessels; or (3) advisory services in connection with the Vessels

and any future vessels.

8. Each of the Management Agreements between MMS or MMBS and a

Vessel Owner has a five-year term, with the option to renew. A complete list of the

Management Agreements between the Debtors and MMS or MMBS is attached hereto

as Schedule 1.

9. For reference purposes, a copy of one of the Management Agreements

with MMS is attached hereto as Exhibit B (the “MMS Management Agreement”).4

Copies of each Management Agreement are available upon request by a party in

interest.

ii. The Sealion Management Agreement

10. Sealion is the Managing Agent for the Debtors’ Offshore Segment and

facilitates the operations of twenty-six (26) offshore Vessels, twenty-three of which

Toisa Limited owns directly. The remaining three (3) offshore Vessels are wholly-

owned by separate, direct subsidiaries of Toisa Limited.

4 The MMS Management Agreement is representative of the other Management Agreements between a

Vessel Owner and either MMS or MMBS.


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11. Rather than having each individual Vessel enter into a separate

Management Agreement, Sealion has a master Management Agreement with Toisa

Limited (as amended, the “Sealion Management Agreement” attached hereto as

Exhibit C). The original Sealion Management Agreement between Sealion and Toisa

was executed in 1989 and has continually been amended and renewed, as needed, to

include additional Vessels and to extend the term. A list of the Vessels managed under

the Sealion Management Agreement is attached hereto as Schedule 2.

12. Sealion arranges the employment of more than 800 seastaff and employees

and more than 90 onshore personnel. Sealion is an accredited ISM (International Safety

Management) ship management company and provides a full range of ship

management functions, including operations, technical, chartering, crewing, project

management, safety, purchasing and logistics, and accounting services to the offshore

fleet. Sealion would then pay all invoices for these services to third-parties and then

invoice the Vessel Owners for reimbursement.

13. Currently, however, Sealion invoices charters on behalf of Toisa Limited

and several other Debtor subsidiaries, and the collection of charter receipts are made

directly into either a bank account at Toisa Limited or Sealion, as the Management

Agent. Sealion records a comprehensive range of nominal ledger account entries that

are used to record all transactions that Sealion undertakes on behalf of the Debtors for

which it serves as the Management Agent. This includes the recording of all revenues,

operational expenses, accruals, prepayments, debtors, creditors, assets, drydocking,

stock, and any movements of cash between the two entities.

14. In addition, Sealion earns commission and management fees on account of

the Vessels it manages in accordance with the Management Agreements. These

commission and management fees are invoiced on a quarterly basis and settled on


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commercial terms. In this regard, the compensation structure is different with Sealion

than it is with MMS and MMBS. Specifically, Toisa Limited pays Sealion an annual fee

on account of each Vessel based on the schedule to the Management Agreement,

payable each month.

15. Sealion also provides ship management services to Toisa Limited

subsidiary and Debtor entity Edgewater Offshore Limited, and the intercompany

relationship is managed the same way as MMS and MMBS intercompany claims are

handled.

16. Compensation structures aside, the duties and responsibilities of Sealion

are substantially identical to those of MMS and MMBS.

B. The Cash Management Practices

17. To support their expansive global operations and their fleet of tankers,

bulkers and offshore Vessels, the Company (including the Managing Agents) maintains

sophisticated Cash Management Practices that link certain bank accounts of the Debtors

and their non-Debtor affiliates to facilitate cash flow between these entities, while

minimizing administrative costs. A chart illustrating the receipt of revenues and

disbursement of expenses through the Bank Accounts for the Company (the “Chart”) is

attached hereto as Exhibit D.

18. The Cash Management Practices are managed primarily by personnel of

the Managing Agents. On a daily basis, the Company processes large numbers of

deposits, withdrawals, and other transfers in accordance with the Cash Management

Practices. Accordingly, the Company maintains current and accurate records of all

transactions processed by way of the Cash Management Practices to track the funds

involved in the Company’s operations and efficiently manage its resources. Thus, the

Cash Management Practices are a critical component of the comprehensive system that


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supports the Company’s overall business enterprise. Set forth below is a summary of

the Cash Management Practices.

i. The Bank Accounts

19. In connection with the Cash Management Practices, the Debtors and

certain of their Managing Agents maintain several dozen bank accounts (collectively,

the "Bank Accounts") at various banks (collectively, the “Banks”), some of which are

also lenders to the Debtors. A list of the Bank Accounts (the “Account List”) is attached

hereto as Schedule 3.5 The Account List identifies the account, the financial institution

at with the account is located, and the owner of each Bank Account.

20. Each of the Vessel Owners generally maintains a Bank Account in its own

name (collectively, the “Vessel Accounts”) with the financial institution that financed

the construction or purchase of the Vessel owned by the Vessel Owner. As a general

matter, the Vessel Accounts are subject to the control of the lenders under the Vessel

Owners’ respective loan facilities and funds therein are part of the collateral package

securing the loan.

21. In addition, the Managing Agents each maintain a Bank Account

(collectively, the “Management Accounts”) that the Managing Agents use to pay each

Vessels’ vendors, suppliers and other third parties directly for supporting the Debtors’

operations, as well to make payroll for certain seaborne crew and pay certain suppliers

for the provision of lubricating oils, insurance and classification society fees and other

select vessel operating costs (collectively, “Day-to-Day Expenses”).

5 The Debtors believe that Schedule 3 contains a complete list of their Bank Accounts. To the extent

that any Bank Account has been omitted from that list, the Debtors request that the order granting the relief sought herein apply to any and all Bank Accounts of the Company that are used consistent with the Cash Management Practices.


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22. Finally, Toisa Limited maintains Bank Accounts at Goldman Sachs (the

“GS Account”) and Lloyds in London. These accounts accumulate the Company’s net

earnings, pay Management Agent fees, and, as necessary, make distributions to holders

of the Company’s equity interests when duly authorized under the Company’s

corporate organizational documents. When necessary, funds at Goldman Sachs and

Lloyds can be transferred to Toisa Limited’s wholly-owned subsidiary, Trade and

Transport Inc., which, through its agency Trade and Transport (UK) Ltd., provide sale

and purchase support for new vessels to be acquired for the Company’s fleet.

ii. The Company’s Cash Management Practices

23. Until the downturn in the Debtors’ Oceangoing Segment in Q3 2016, the

Vessel Accounts had been used to deposit revenue earned in connection with charters

of their respectively owned Vessel (such revenue is commonly referred to as “Freights”).

Freights deposited into the Vessel Accounts could then be disbursed directly from the

Vessel Accounts to pay certain third party suppliers for, among other things, (i) bunkers

(i.e., the fuel burned by the Vessels) and (ii) lubrication for the Vessels’ engines and

mechanical workings, as well as to (iii) fund secured lender retention accounts

established in order to service any debt obligations of the Vessel Owner.

24. In addition, a portion of the Freights deposited into the Vessel Accounts

would also be transferred to other Bank Accounts, including Management Accounts on

an as-needed basis to, inter alia, pay the Day-to-Day Expenses (other than fuel and

lubrication expenses) of the Vessels.

25. However, following the downturn in the Oceangoing Segment and

beginning in September 2016, in an effort to better manage and conserve the Debtors’

cash, Freights were instructed to be remitted directly to the Management Accounts,


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rather than Vessel Accounts.6 As in the past, however, the Managing Agent would

then use funds in the Management Accounts to pay each Debtors’ Day-to-Day-Expenses.

26. Since then, the Managing Agents have been directly collecting the receipts

for their respective Vessels and paying expenses from the respective Management

Accounts – MMS and MMBS each make disbursements for the benefit of the tankers

and bulkers they respectively manage (including disbursements made by MMS’s New

York-based agent Broker & Management Corporation, a non-Debtor affiliate), and

Sealion makes disbursements for the benefit of the Offshore Vessels it manages. The

Cash Management Practices, as currently structured, are an integral component of how

the Debtors manage their affairs and their cash.

27. With these practices in place, the Managing Agents routinely deposit,

withdraw, and otherwise transfer money to, from, and between certain of the Bank

Accounts by various methods (collectively, the “Ordinary Transfer Methods”),

including, but not limited to, wires, automated clearing house transfers, and other

electronic funds transfers.

28. The Debtors are thus able to manage and trace funds moving through the

Bank Accounts in accordance with their Cash Management Practices via the Managing

Agents and are able to track and reconcile payments made to third party vendors on

their behalf such that all transactions made on the Debtors’ behalf both within the

enterprise and to outside and third party vendors can be ascertainable.

29. As of the Petition Date, the Debtors believe there are sufficient funds in

the Management Accounts maintained by the Managing Agents for the Debtors to

6 As an exception, the Freights associated with Toisa Limited offshore Vessel, the Paladin, are remitted

to the GS Account, which in turn are remitted to Sealion for management of the Vessel.


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continue to operate their business for at least next three (3) months, based on the

Debtors’ current forecasts.

iii. Intercompany Transactions

30. In the ordinary course of business, the Company engages in routine

intercompany financial transactions with Debtors and non-Debtor affiliates (collectively,

the “Intercompany Transactions”). The Intercompany Transactions include, but are not

limited to payments or transfers from a Debtor to another Debtor or a non-Debtor

affiliate, giving rise to claims (“Intercompany Claims”).

31. Specifically, the Debtors maintain ordinary business relationships with

their non-Debtor affiliates, particularly the Managing Agents, which involve routine

transfers of cash to and from each entity’s Bank Accounts. Intercompany Claims arise

from such transfers, which may be completed in connection the various obligations the

Managing Agents satisfy on behalf of the Debtors (as well as certain non-Debtor

affiliates), such as payroll obligations, payments to harbormasters and other docking

charges, refueling costs, and other operational expenses.

32. The Debtors maintain records of transfers of cash to trace and account for

these Intercompany Transactions. The continuance of these transactions postpetition

(each a “Postpetition Intercompany Transaction”) is an essential component of the Cash

Management Practices, particularly in light of the Company’s complex corporate and

operational structure. The Debtors will continue to maintain records of such

Postpetition Intercompany Transactions and respectfully request, pursuant to

Bankruptcy Code sections 364(b) and 503(b), that postpetition payments on account of

such Postpetition Intercompany Transactions among Debtors be granted administrative

expense status.


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C. The Business Forms

33. In the ordinary course of business, the Debtors use a number of checks,

business letterhead, purchase orders, invoices, envelopes, promotional materials, and

other business forms and correspondence (collectively, the “Business Forms”). Given

that the Business Forms were used prepetition, they do not include references to the

Debtors’ current status as debtors in possession. Most parties doing business with the

Debtors will undoubtedly be aware of the Debtors’ status as debtors in possession as a

result of the publicity surrounding these Chapter 11 Cases and the notice of

commencement of these Chapter 11 Cases that has been or will soon be provided to

parties in interest. As is the case with the existing Cash Management Practices,

requiring the Debtors to change their existing Business Forms would unnecessarily

distract the Debtors from their restructuring efforts and impose needless expenses on

the estates, without any meaningful corresponding benefit.

JURISDICTION AND VENUE

34. This Court has jurisdiction to consider this Motion pursuant to 28 U.S.C.

§§ 157 and 1334. This is a core proceeding under 28 U.S.C. § 157(b). Venue of these

cases and this Motion in this District is proper under 28 U.S.C. §§ 1408 and 1409.

35. The predicates for the relief requested herein are sections 105, 345, 363, 364,

503(b), 1107, and 1108 of the Bankruptcy Code.

RELIEF REQUESTED

36. By this Motion, the Debtors request entry of interim and final orders: (a)

authorizing the Debtors to continue using their existing Cash Management Practices,

Bank Accounts, and Business Forms, in each case subject to changes that they may make

thereto in their sole discretion; (b) waiving any applicable investment and deposit

requirements imposed by section 345(b) of the Bankruptcy Code or otherwise; and


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(c) authorizing the Debtors to continue their Intercompany Transactions in the ordinary

course of business and, to the extent applicable, granting administrative expense status

to postpetition intercompany claims between and among the Debtors pursuant to

Bankruptcy Code section 503(b)(1).

37. The Debtors also request that the Court schedule a final hearing on the

Motion within forty-five (45) days of the entry of Interim Order.

BASIS FOR RELIEF

A. The Court Should Authorize Continued Use of the Existing Cash Management Practices in the Ordinary Course of Business

38. The Cash Management Practices and applicable procedures employed by

the Debtors constitute customary and essential business practices. The Cash

Management Practices afford the Debtors significant benefits, including, among other

things, the ability to: (a) centrally control corporate funds; (b) ensure the availability of

funds when necessary; and (c) minimize administrative expenses by facilitating a more

efficient movement of funds and monitoring of balance and presentment information.

It would be unduly difficult and expensive for the Debtors to establish new cash

management practices. The Debtors therefore request permission to continue their

existing Cash Management Practices on an interim basis for forty-five (45) days and,

ultimately, on a final basis.

39. Moreover, given that the services provided by the Managing Agents are

essential to the Vessels’ operations, approval of the Cash Management Practices

necessarily entails the Debtors’ continued utilization of the Managing Agents’ services

under the Management Agreements. Indeed, without these services, the Debtors’ entire

business would cease operations, dooming the Debtors before even being given the

opportunity to utilize and benefit from the Bankruptcy Code. Without core services


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such as hiring, securing docking papers, securing charters, and the payment of

employee wages, the Vessels would be unable to operate or service its charters. A loss

or interruption of Managing Agents’ services — even on a temporary basis — could

immediately undermine operations of the Vessels, adversely and permanently

impacting the service. This could result in irreparable damage to the Debtors’ ability to

operate the Vessels during this critical early stage of the Debtors’ Chapter 11 Cases.

Accordingly, the Managing Agents and the services they provide with respect to

managing the Debtors’ Vessels are an integral part of the Debtors’ Cash Management

Practices.

40. Allowing the existing Cash Management Practices to remain in place will

facilitate a smoother transition into chapter 11 and will aid the Debtors’ restructuring

efforts. Notably, the Cash Management Practices include the necessary accounting

controls to enable the Debtors, as well as creditors and the Court, if necessary, to trace

amounts through the system and ensure that all transactions are adequately

documented and readily ascertainable. The continuation of the Company’s existing

Cash Management Practices and related Bank Accounts ensure the ongoing concern of

the Debtors and Debtors’ operations.

41. In order to effectuate the purposes of this Motion, the Debtors request that

all Banks be authorized and directed to: (a) continue administering the Bank Accounts

in the usual and ordinary course of business in accordance with the Debtors’

instructions and pursuant to the Bank Account Agreements; (b) pay any and all checks,

drafts, wires, or electronic funds transfers presented, issued, or drawn on the Bank

Accounts on account of any claims arising prepetition or postpetition, so long as

sufficient funds are available in such Bank Accounts unless the Debtors specifically

issue “stop payment” instructions with respect to such items in accordance with the


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terms of the Bank Account Agreements; (c) honor the Debtors’ directions with respect

to the opening or closing of any Bank Account; (d) accept and hold, or invest, the

Debtors’ funds in accordance with the Debtors’ instructions; and (e) pay to the

Managing Agents any fees associated with the Managemenet Agents’ services provided

under the Management Agreements.

42. The Debtors propose that such Banks be allowed to rely on any order

entered granting this Motion and on the Debtors’ representations and instructions as to

the payments and transfers that may be honored or dishonored in accordance with the

terms of the Bank Account Agreements. The Debtors further propose that the Banks not

be liable to any party on account of: (a) following the Debtors’ instructions or

representations as to any order of the Court and (b) honoring any checks, drafts, wires,

or electronic funds transfers presented in a good faith belief that this Court has

authorized the honoring of such checks, drafts, wires, or electronic funds transfers.

43. Section 363(c)(1) of the Bankruptcy Code authorizes the debtors in

possession to “use property of the estate in the ordinary course of business without

notice or a hearing.” 11 U.S.C. § 363(c)(1). The purpose of section 363(c)(1) of the

Bankruptcy Code is to provide debtors in possession with the flexibility to engage in

ordinary course transactions required to operate their businesses, without unneeded

oversight by its creditors or the Court. See, e.g., Med. Malpractice Ins. Ass’n v. Hirsch (In

re Lavigne), 114 F.3d 379, 384 (2d Cir. 1997); In re Enron Corp., No. 01-16034 (AJG), 2003

WL 1562202, at *15 (Bankr. S.D.N.Y. Mar. 21, 2003); Chaney v. Official Comm. of

Unsecured Creditors of Crystal Apparel, Inc. (In re Crystal Apparel, Inc.), 207 B.R. 406, 409

(S.D.N.Y. 1997).

44. The Debtors’ ability to continue their Cash Management Practices and

engaging in related routine transactions falls within the parameters of section 363(c) of


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the Bankruptcy Code. See Amdura Nat’l Distribution Co. v. Amdura Corp. (In re Amdura

Corp.), 75 F.3d 1447, 1453 (10th Cir. 1996); Charter Co. v. Prudential Ins. Co. of Am. (In re

Charter Co.), 778 F.2d 617, 621 (11th Cir. 1985) (holding that a debtor’s request for

authority to continue using its existing cash management system is consistent with

section 363(c)(1) of the Bankruptcy Code).

45. To the extent that continuing the existing Cash Management Practices is

beyond the ordinary course of the Debtors’ business, such use is permitted by sections

363(b)(1) and 105(a) of the Bankruptcy Code. Section 363(b)(1) of the Bankruptcy Code

provides, in relevant part, that “[t]he trustee, after notice and a hearing, may use, sell, or

lease, other than in the ordinary course of business, property of the estate.” 11 U.S.C.

§ 363(b)(1). Section 105(a) of the Bankruptcy Code further provides that the Court may

“issue any order . . . that is necessary or appropriate to carry out the provisions of” the

Bankruptcy Code. 11 U.S.C. § 105(a).

46. As another court situated in this District has previously stated, “[w]here

the debtor articulates a reasonable basis for its business decisions (as distinct from a

decision made arbitrarily or capriciously), courts will generally not entertain objections

to the debtor’s conduct.” Comm. of Asbestos-Related Litigants v. Johns-Manville Corp. (In re

Johns-Manville Corp.), 60 B.R. 612, 616 (Bankr. S.D.N.Y. 1986). Where there is a valid

business justification for using property outside the ordinary course of business, the law

presumes that, “‘in making a business decision the directors of a corporation acted on

an informed basis, in good faith[,] and in the honest belief that the action taken was in

the best interests of the company.’“ Official Comm. of Subordinated Bondholders v.

Integrated Res., Inc. (In re Integrated Res., Inc.), 147 B.R. 650, 656 (S.D.N.Y. 1992) (quoting

Smith v. Van Gorkom, 488 A.2d 858, 872 (Del. 1985)).


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47. Under the circumstances, and in light of the Debtors’ belief that

continuation of the Cash Management Practices is in the best interests of the estates, the

Debtors request that the Court authorize them to continue using their Cash

Management Practices.

B. The Court Should Authorize Continued Use of the Bank Accounts and the Business Forms on an Interim Basis

48. The U.S. Trustee Guidelines, among other restrictions and requirements,

prohibit disbursements other than by numbered checks, which checks must bear the

applicable debtor’s case name and case number, a “debtor in possession” designation,

and an indication of the account type. However, rigid adherence to the U.S. Trustee

Guidelines would require, among other things, closure of prepetition bank accounts, the

opening of new accounts, and the immediate printing of new checks with a “Debtors in

Possession” designation on them. Thus, enforcement of the U.S. Trustee Guidelines in

these Chapter 11 Cases would disrupt the Debtors’ business operations, impose

burdensome expenses on the estates, and unnecessarily distract the Debtors from their

reorganization efforts.

49. In the ordinary course of business, the Debtors may also use other various

Business Forms, including, but not limited to, business letterhead, purchase orders,

invoices, envelopes, promotional materials, and other business forms and

correspondence. To minimize expenses, the Debtors seek authority to continue using

the Business Forms, substantially in the forms existing immediately before the Petition

Date and without any reference in such forms to the Debtors’ status as debtors in

possession. As with the Bank Accounts, requiring the Debtors to change their existing

Business Forms would unnecessarily distract the Debtors from their restructuring

efforts and impose needless expense.


20

50. Here, authorizing continued use of both the Bank Accounts and the

Business Forms will make the Debtors’ transition into chapter 11 smoother, less costly,

and more orderly. Accordingly, the Debtors request that the Court exercise its equitable

powers under section 105(a) of the Bankruptcy Code to waive compliance with the U.S.

Trustee Guidelines and to authorize the Debtors to continue using their existing Bank

Accounts and existing Business Forms in the ordinary course of business on an interim

basis for a period of forty-five (45) days and, ultimately, on a final basis.

Notwithstanding this waiver, the Debtors will make reasonable best efforts to include a

reference to their status as debtors in possession on the Business Forms.

C. The Court Should Authorize the Debtors to Honor Certain Prepetition Obligations Related to the Cash Management Practices

51. In connection with the Cash Management Practices, the Debtors incur fees

and other charges in connection with Bank services (the “Service Charges”), dishonored

or returned checks, and other obligations under the Bank Account Agreements

(collectively, the “Bank Account Claims”).

52. As with the Cash Management Practices, payment of the Bank Account

Claims will minimize disruption to the Debtors’ operations and is therefore in the best

interests of the estates. Absent payment of the Bank Account Claims, the Banks might

assert setoff rights against the funds in the Bank Accounts on account of the Bank

Account Claims, freeze the Bank Accounts, and/or refuse to provide services to the

Debtors. The payment of Bank Account Claims will not prejudice unsecured creditors

given that, as noted above, the Banks may have setoff rights with respect to the Bank

Account Claims.

53. In addition, as discussed more fully above, the Management Agreements

provide that the Managing Agents be paid certain fees in exchange for the services the


21

Managing Agents provide in connection with management of the Debtors’ Vessels (the

“Management Fees”). The Debtors’ operations are dependent upon the Managing

Agents providing management services with respect to the Debtors Vessels, and any

disruption to that arrangement could prove ruinous to the Debtors’ business.

54. Accordingly, pursuant to sections 105(a) and 363(b) of the Bankruptcy

Code, the Debtors seek authority, in their sole discretion, to continue to pay and/or

reimburse the Banks in the ordinary course of business for any Bank Account Claims

and allow payment of any outstanding Management Fees from the respective

Management Accounts.

D. The Court Should Authorize the Debtors to Engage in the Intercompany Transactions in the Ordinary Course of Business

55. The Debtors routinely engage in the Intercompany Transactions in the

ordinary course of business, and submit that the continuation of the Postpetition

Intercompany Transactions would be within the ordinary course of business. However,

in an abundance of caution, the Debtors seek authority to enter into such Postpetition

Intercompany Transactions in the ordinary course of business. If the Debtors are

permitted to continue entering into the Postpetition Intercompany Transactions in the

ordinary course, the Debtors will continue to maintain records of Postpetition

Intercompany Transactions, including records of intercompany accounts receivable and

accounts payable on a per entity basis.

56. As noted above, pursuant to Bankruptcy Code section 363(b)(1), debtors in

possession are authorized to use property of the estate other than in the ordinary course

of business after notice and a hearing. The Intercompany Transactions facilitate the

Debtors’ day-to-day operations, as well as the day-to-day operations of the non-Debtor

affiliates, which are responsible for managing the Debtors’ affairs. Thus, the Debtors


22

submit that such relief under Bankruptcy Code section 363(b)(1) is appropriate, as

entrance into Postpetition Intercompany Transactions is well within the sound business

judgment of the Debtors.

57. Additionally, pursuant to section 503(b) of the Bankruptcy Code, the

Debtors request that all Intercompany Claims against a Debtor by another Debtor or a

Non-Debtor Affiliate arising postpetition, in the ordinary course of business, as a result

of a Postpetition Intercompany Transaction, be granted administrative expense priority

status. If the Postpetition Intercompany Claims are accorded administrative expense

priority status, each entity utilizing funds that flow through the Bank Accounts

consistent with the Cash Management Practices should continue to bear ultimate

repayment responsibility for such ordinary-course transactions. The Debtors expressly

reserve their rights to contest the validity and/or amount of any Postpetition

Intercompany Transaction and Intercompany Claim.

58. Courts in this and other jurisdictions have routinely granted similar relief

in other chapter 11 cases. See, e.g., In re Relativity Fashion, LLC et al., No. 15-11989 (Bankr.

S.D.N.Y. July 30, 2015) (allowing debtors to continue intercompany transactions and

granting administrative expense priority to intercompany claims arising postpetition);

In re Genco Shipping & Trading Ltd., et al., No. 14-11108 (Bankr. S.D.N.Y. Apr. 21, 2014)

(same); In re Exide Tech., No. 13-11482 (Bankr. D. Del. June 10, 2013) (authorizing debtor

to pay certain prepetition intercompany claims and continue intercompany transactions,

and granting administrative expense priority to intercompany claims arising

postpetition); In re MF Global Holdings, Ltd., No. 11-15059 (Bankr. S.D.N.Y. Apr. 4, 2012)

(allowing debtors to continue intercompany transactions and granting administrative

expense priority to intercompany claims arising postpetition).


23

E. Cause Exists to Waive the Investment and Deposit Restrictions Imposed by Section 345 of the Bankruptcy Code and the U.S. Trustee Guidelines Regarding Authorized Depositories on an Interim and Final Basis

59. Section 345(a) of the Bankruptcy Code authorizes deposits or investments

of estate money in a manner that will “yield the maximum reasonable net return on

such money, taking into account the safety of such deposit or investment.” 11 U.S.C.

§ 345(a). For deposits or investments that are not “insured or guaranteed by the United

States or by a department, agency, or instrumentality of the United States or backed by

the full faith and credit of the United States,” section 345(b) of the Bankruptcy Code

provides that the estate must require from the entity with which the money is deposited

or invested a bond in favor of the United States secured by the undertaking of an

adequate corporate surety, “unless the court for cause orders otherwise.” Id. at 345(b).

60. To help Debtors comply with this section of the Bankruptcy Code, the U.S.

Trustee has promulgated the Region 2 United States Trustee’s Operating Guidelines

and Reporting Requirements for Debtors in Possession and Trustees (Nov. 27, 2013) (the

“U.S. Trustee Guidelines”) as well as a list of authorized depositories (the “Authorized

Depositories”) at which Debtors may maintain bank accounts. Under the U.S. Trustee

Guidelines, debtors in possession must, among other things, close prepetition bank

accounts and open new “debtor in possession” operating, payroll, and tax accounts at

an Authorized Depository.

61. As noted above, however, courts may waive compliance with section

345(b) of the Bankruptcy Code, and ultimately the U.S. Trustee Guidelines, for “cause.”

In evaluating whether “cause” exists, courts have considered a number of factors,

including, among others, the sophistication and size of a debtor’s business, the amounts

of the investments involved, bank ratings, the complexity of the case, the debtor’s

safeguards for the funds, the debtor’s ability to reorganize in the face of failure of one or


24

more of the financial institutions, the benefit to the debtor of a waiver of the section

345(b) requirements, the potential harm to the estate, and the reasonableness of such a

waiver under the circumstances. See In re Serv. Merch. Co., 240 B.R. 894, 896 (Bankr. M.D.

Tenn. 1999).

62. Congress has cautioned that the investment and deposit requirements of

section 345 of the Bankruptcy Code may be “wise in the case of a smaller debtor with

limited funds that cannot afford a risky investment to be lost, [but such requirements]

can work to needlessly handcuff larger, more sophisticated debtors.” H.R. Rep. 103-835,

103d Cong., 2d Sess. 224 (Oct. 4, 1994); 140 Cong. Rec. H10767 (Oct. 4, 1994). Thus,

Congress added the waiver clause in section 345(b) of the Bankruptcy Code “to allow

the courts to approve investments other than those permitted by section 345(b) for just

cause.” Id.

63. The Debtors do not maintain any investment accounts. While none of the

Banks the Company utilizes, including two of the Banks at which the Management

Accounts (HSBC and Citi) are held, are on the U.S. Trustee’s list of Authorized Bank

Depositories, the Debtors’ funds are held in internationally known institutions,

including the London affiliate of HSBC Bank USA, N.A., which is an Authorized Bank

Depository. Because these Bank Accounts, including the Management Accounts, are

vital to the Debtors’ Cash Management Practices, the Debtors submit that requiring the

Debtors to transfer these funds to other U.S.-based banks would be crippling to the

Debtors’ operations, which must seamlessly operate across multiple jurisdictions. Thus,

the Debtors submit that there is cause to waive strict compliance with the U.S. Trustee’s

Guidelines on an interim basis.7

7 The Debtors reserve the right to seek further extensions of the interim order.


25

64. Courts in this District have authorized debtors to maintain cash

management systems and use their existing depository accounts, even when such

accounts are located at foreign banks. See, e.g., Interim Order, In re Nautilus Holdings

Limited, et al., No. 14-22885 (Bankr. S.D.N.Y. June 25, 2014), ECF No. 28 (allowing

maintenance of several bank accounts in overseas banks); Interim Order, In re Excel

Maritime Carriers LLC, No. 13-23060 (Bankr. S.D.N.Y. July 2, 2013) (allowing

maintenance of several dozen bank accounts in overseas banks); Interim Order, In re

Marco Polo Seatrade B.V. et. al., No. 11-13634 (Bankr. S.D.N.Y. Aug. 12, 2012), ECF No. 49

and Final Order, In re Marco Polo Seatrade B.V. et. al., No. 11-13634 (Bankr. S.D.N.Y. Oct.

18, 2011), ECF No. 204 (allowing debtors to maintain existing cash management system

without modification for over 120 days); Interim Order, In re Gen. Mar. Corp., No. 11-

15285 (Bankr. S.D.N.Y. Nov. 18, 2011), ECF No. 31 and Final Order, In re Gen. Mar. Corp.

et. al., No. 11-15285 (Bankr. S.D.N.Y. Dec. 28, 2011), ECF No. 155 (allowing debtors to

maintain existing cash management system containing many foreign bank accounts

without modification for at least 40 days, including over 40 accounts at Nordea in the

Cayman Islands); Interim Order, In re B+H Carriers Ltd. et. al., No. 12-12356 (Bankr.

S.D.N.Y. June 28, 2012), ECF No. 63 and Final Order, In re B+H, No. 12-12356 (Bankr.

S.D.N.Y. Aug. 8, 2012), ECF No. 132 (allowing debtors to maintain existing cash

management system containing many foreign bank accounts without modification for

over 65 days); Order, In re Satelites Mexicanos, S.A. de C.V., No. 06-11868 (Bankr.

S.D.N.Y. Oct. 26, 2006), ECF No. 147 (allowing maintenance of over a dozen foreign

bank accounts, particularly several Mexican bank accounts).

65. The Debtors further request that they be authorized, on an interim basis

for forty-five (45) days, in their sole discretion, to close Bank Accounts and open new

bank accounts on notice to parties, if such action becomes necessary for any reason. In


26

connection therewith, the Debtors request that the applicable Banks be authorized and

directed to honor the Debtors’ directions with respect to the opening or closing of any

bank account. The Debtors further request that any and all accounts opened by the

Debtors on or after the Petition Date at any Bank be deemed a Bank Account (as if it had

been opened prior to the Petition Date and included in the Account List) and that any

and all Banks at which such accounts are opened similarly be subject to the rights and

obligations of any order on this Motion.

66. For the reasons set forth above, the Debtors submit that the relief

requested in this Motion is in the best interests of the Debtors, their estates, creditors,

stakeholders, and other parties in interest, and therefore should be granted.

IMMEDIATE RELIEF IS NECESSARY TO AVOID IMMEDIATE AND IRREPARABLE HARM

67. Rule 6003 of the Federal Rules of Bankruptcy Procedures (“Bankruptcy

Rules”) provides that the relief requested in this Motion may be granted if the “relief is

necessary to avoid immediate and irreparable harm.” Fed. R. Bankr. P. 6003; see also In

re First NLC Fin. Servs., LLC, 382 B.R. 547, 549 (Bankr. S.D. Fla. 2008) (holding that

Bankruptcy Rule 6003 permits entry of retention orders on interim basis to avoid

irreparable harm). The Second Circuit has interpreted the language “immediate and

irreparable harm” in the context of preliminary injunctions. In that context, the Second

Circuit instructed that irreparable harm “‘is a continuing harm which cannot be

adequately redressed by final relief on the merits’ and for which ‘money damages

cannot provide adequate compensation.’“ Kamerling v. Massanari, 295 F.3d 206, 214 (2d

Cir. 2002) (quoting N.Y. Pathological & X-Ray Labs., Inc. v. INS, 523 F.2d 79, 81 (2d Cir.

1975)). Further, the “harm must be shown to be actual and imminent, not remote or

speculative.” Id. at 214; see also Rodriguez v. DeBuono, 175 F.3d 227, 234 (2d Cir. 1999).


27

The Debtors submit that, for the reasons already set forth herein, the relief requested in

this Motion is necessary to avoid immediate and irreparable harm.

WAIVER OF STAY UNDER BANKRUPTCY RULE 6004(h)

68. The Debtors also request that the Court waive the stay imposed by

Bankruptcy Rule 6004(h), which provides that “[a]n order authorizing the use, sale, or

lease of property other than cash collateral is stayed until the expiration of 14 days after

entry of the order, unless the court orders otherwise.” Fed. R. Bankr. P. 6004(h). As

described above, the relief that the Debtors seek in this Motion is necessary for the

Debtors to operate their businesses without interruption and to preserve value for their

estates. Accordingly, the Debtors respectfully request that the Court waive the

fourteen-day stay imposed by Bankruptcy Rule 6004(h), as the exigent nature of the

relief sought herein justifies immediate relief.

NOTICE

69. Notice of this Motion shall be given to: (a) the United States Trustee for

the Southern District of New York; (b) the Debtors’ material prepetition secured

lenders; (c) the parties listed in the consolidated list of thirty (30) largest unsecured

creditors filed by the Debtors in these Chapter 11 cases; (d) the Internal Revenue

Service; and (e) any such other party entitled to notice pursuant to Local Bankruptcy

Rule for the United States Bankruptcy Court for the Southern District of New York

9013-1(b). The Debtors submit that no other or further notice need be provided.

NO PRIOR REQUEST

70. No previous request for the relief requested herein has been made to this

Court or any other court.


28

CONCLUSION

WHEREFORE, the Debtors respectfully request that the Court enter an interim

order, substantially in the form annexed hereto as Exhibit A, granting the relief

requested in this Motion and such other and further relief as may be just and proper.

DATED: New York, New York January 29, 2017

TOGUT, SEGAL & SEGAL LLP, Proposed Counsel to the Debtors and Debtors in Possession TOISA LIMITED, et al., By: /s/Albert Togut ALBERT TOGUT FRANK A. OSWALD BRIAN F. MOORE KYLE J. ORTIZ One Penn Plaza, Suite 3335 New York, New York 10119 (212) 594-5000


Schedule 1: Vessels with Management Agreements with Marine or Marine Bulk

Vessels

Tankers (Marine)

1. United Dynamic

2. United Emblem

3. United Ideal

4. United Ambassador

5. United Banner

6. United Carrier

7. United Fortitude

8. United Grace

9. United Honor

10. United Journey

11. United Kalavryta

12. United Leadership

13. United Seas

Bulkers (Marine Bulk)

1. Trade Unity

2. Trade Resource

3. Trade Vision

4. Trade Will

5. Trade Prosperity

6. Trade Quest

7. Trade Spirit

17-10184 Doc 8-1 Filed 01/29/17 Entered 01/29/17 23:27:24 Schedule 1: Marine and Marine Bulk Vessels Pg 1 of 1

Schedule 2: Vessels Part of Master Management Agreement with Sealion

Vessels Construction Class

1. Toisa Perseus 2. Toisa Proteus 3. Toisa Paladin 4. Toisa Pegasus

Well Test Vessel

5. Toisa Pisces ROV/DSV

6. Toisa Coral 7. Toisa Crest 8. Toisa Conqueror 9. Toisa Valiant 10. Toisa Vigilant 11. Toisa Voyager 12. Toisa Warrior 13. Toisa Wave 14. Sealion Amazonia

PSV/AHTS

15. Toisa Intrepid 16. Toisa Invincible 17. Toisa Independent 18. Toisa Serenade 19. Toisa Solitare 20. Toisa Sonata 21. Toisa Defiant 22. Toisa Daring 23. Tosa Dauntless 24. Toisa Elan 25. Toisa Envoy 26. Toisa Explorer

17-10184 Doc 8-2 Filed 01/29/17 Entered 01/29/17 23:27:24 Schedule 2: Sealion Vessels Pg 1 of 1

Schedule 3: Bank Accounts

Debtors’ Accounts: Offshore Segment

BANK NAME BANK LOCATION ACCOUNT NUMBER

(LAST FOUR) HOLDER

1. DnB NOR BANK LONDON, UK 2002 TOISA LTD 2. DnB NOR BANK LONDON, UK 2001 TOISA LTD 3. DnB NOR BANK LONDON, UK 2003 TOISA LTD 4. DnB NOR BANK LONDON, UK 2050 TOISA LTD 5. DnB NOR BANK LONDON, UK 2051 TOISA LTD 6. CITIBANK EUROPE PLC PIRAEUS, GREECE 1037 TOISA LIMITED 7. CITIBANK EUROPE PLC PIRAEUS, GREECE 1053 TOISA LIMITED 8. CITIBANK EUROPE PLC PIRAEUS, GREECE 1819 TOISA LIMITED 9. CITIBANK EUROPE PLC PIRAEUS, GREECE 1789 TOISA LIMITED 10. CITIBANK EUROPE PLC PIRAEUS, GREECE 1807 TOISA LIMITED 11. CITIBANK EUROPE PLC PIRAEUS, GREECE 1613 TOISA LIMITED 12. CITIBANK EUROPE PLC PIRAEUS, GREECE 1534 TOISA LIMITED 13. CITIBANK EUROPE PLC PIRAEUS, GREECE 1522 TOISA LIMITED 14. CITIBANK EUROPE PLC PIRAEUS, GREECE 1274 TOISA LIMITED 15. CITIBANK EUROPE PLC PIRAEUS, GREECE 1401 TOISA LIMITED 16. CITIBANK EUROPE PLC PIRAEUS, GREECE 1258 TOISA LIMITED 17. CITIBANK EUROPE PLC PIRAEUS, GREECE 1266 TOISA LIMITED 18. CITIBANK EUROPE PLC PIRAEUS, GREECE N/A TOISA LIMITED 19. CITIBANK EUROPE PLC PIRAEUS, GREECE N/A TOISA LIMITED 20. CREDIT AGRICOLE PARIS, FRANCE 7178 TOISA LTD 21. COMMERZBANK HAMBURG, GERMANY 4000 TOISA LIMITED 22. BNP PARIBAS GENEVA, SWITZERLAND 39/1H TOISA LIMITED 23. DVB BANK FRANKFURT, GERMANY 5434 TOISA HORIZON INC 24. DVB BANK FRANKFURT, GERMANY 5426 TOISA LTD 25. CITIBANK LONDON, UK 1267 TOISA LTD 26. GOLDMAN SACHS LONDON, UK Euro Account TOISA LTD 27. GOLDMAN SACHS LONDON, UK USD Account TOISA LTD 28. GOLDMAN SACHS LONDON, UK Fixed Deposits TOISA LTD 29. LLOYDS LONDON, UK Term Deposit TOISA LTD

17-10184 Doc 8-3 Filed 01/29/17 Entered 01/29/17 23:27:24 Schedule 3: Bank Accounts Pg 1 of 5

Debtors’ Bank Accounts: Oceangoing Segment

BANK NAME BANK LOCATION

ACCOUNT NUMBER (LAST FOUR) HOLDER

1. ALPHA BANK PIRAEUS, GREECE 4000 UNITED IDEAL INC 2. NATIONAL BANK OF

GREECE PIRAEUS, GREECE 7972 TRADE SKY INC (Vessel Un.Fortitude)

3. NATIONAL BANK OF GREECE PIRAEUS, GREECE 7899

TRADE SKY INC (Vessel Un.Fortitude)

4. NATIONAL BANK OF GREECE PIRAEUS, GREECE 7899 UNITED JOURNEY INC

5. DnB NOR BANK LONDON, UK 0001 UNITED DYNAMIC INC

6. DnB NOR BANK LONDON, UK 0001 UNITED EMBLEM INC

7. DnB NOR BANK LONDON, UK 2001 UNITED IDEAL INC

8. DnB NOR BANK LONDON, UK 9006 UNITED DYNAMIC INC

9. CREDIT AGRICOLE PARIS, FRANCE 7477

TRADE INDUSTRIAL DEVELOPMENT INC (Vessel Un.Grace)

10. CREDIT AGRICOLE PARIS, FRANCE 7574


11. CREDIT AGRICOLE PARIS FRANCE FIXED DEPOSIT


12. CITIBANK EUROPE PLC ATHENS, GREECE 5008 UNITED SEAS INC

13. CITIBANK EUROPE PLC ATHENS, GREECE 4004 UNITED JOURNEY

14. COMMERZBANK HAMBURG, GERMANY 4300 UNITED HONOR INC

15. COMMERZBANK HAMBURG, GERMANY 7600 UNITED AMBASSADOR INC

16. COMMERZBANK HAMBURG, GERMANY 7300 UNITED BANNER INC

17. COMMERZBANK HAMBURG, GERMANY 8100 UNITED COURAGE INC 18. AEGEAN BALTIC

BANK PIRAEUS, GREECE 0022 UNITED LEADERSHIP INC 19. AEGEAN BALTIC

BANK PIRAEUS, GREECE 0014 UNITED LEADERSHIP INC 20. AEGEAN BALTIC

BANK PIRAEUS, GREECE 0019 UNITED KALAVRYTA INC 21. CITIBANK EUROPE

PLC LONDON, UK 0623 UNITED JOURNEY 22. CITIBANK EUROPE

PLC LONDON, UK 0017 UNITED SEAS INC


23. CITIBANK EUROPE PLC LONDON, UK 0950 UNITED KALAVRYTA INC

24. COMMERZBANK HAMBURG,GERMANY 4000 TRADE AND TRANSPORT INC 25. CITIBANK EUROPE

PLC ATHENS, GREECE 3024 TRADE AND TRANSPORT INC 26. CITIBANK EUROPE

PLC ATHENS, GREECE 3121 TRADE AND TRANSPORT INC

27. HSBC LONDON, UK 6257 TRADE AND TRANSPORT INC

28. HSBC LONDON, UK 0104 TRADE AND TRANSPORT INC


Non-Debtors’ Bank Accounts: Offshore Segment (Sealion)

BANK NAME BANK LOCATION ACCOUNT NUMBER (LAST FOUR) HOLDER

SEALION SHIPPING LTD 1. DnB NOR BANK LONDON, UK 4004 SEALION SHIPPING LTD 2. DnB NOR BANK LONDON, UK 4009 SEALION SHIPPING LTD 3. HSBC BANK GUILDFORD, UK 1076 SEALION SHIPPING LTD 4. HSBC BANK GUILDFORD, UK 9806 SEALION SHIPPING LTD 5. CITIBANK LONDON, UK 0280 SEALION SHIPPING LTD

CLIENT TOISA

1. DnB NOR BANK LONDON, UK 4003 SEALION CLIENT A/C - EDGEWATER

2. DnB NOR BANK LONDON, UK 4001 SEALION CLIENT A/C - SBN

3. DnB NOR BANK LONDON, UK 4002 SEALION CLIENT A/C - TOISA



6. DnB NOR BANK LONDON, UK 4008 CLIENT TOISA HORIZON

7. DnB NOR BANK LONDON, UK 4010 SEALION CLIENT A/C - SBN-TOISA

8. DnB NOR BANK LONDON, UK 4005 SEALION CLIENT A/C - EDGEWATER

9. HSBC BANK GUILDFORD, UK 1180

SEALION SHIPPING MONEYMASTER CLIENTS ACCOUNT (TOISA)

10. HSBC BANK GUILDFORD, UK 0081 SEALION SHIPPING LTD CLIENTS ACCOUNT (TOISA)

11. CITIBANK LONDON, UK 5091 SEALION SHIPPING LTD 12. CITIBANK LONDON, UK 5032 SEALION SHIPPING LTD

EDGEWATER OFFSHORE SHIPPING LTD

1. DnB NOR BANK LONDON, UK 5001 EDGEWATER OFFSHORE SHIPPING LTD

2. DnB NOR BANK LONDON, UK 5002 EDGEWATER OFFSHORE SHIPPING LTD

FARNHAM MARINE AGENCY

1. HSBC BANK GUILDFORD, UK 1333 FARNHAM MARINE AGENCY 2. HSBC BANK GUILDFORD, UK 0013 FARNHAM MARINE AGENCY


Non-Debtors’ Bank Accounts: Oceangoing Segment (MMS/MMBS)

BANK NAME BANK LOCATION

ACCOUNT NUMBER (LAST FOUR) HOLDER

MARINE MANAGEMENT SERVICES MC

1. CITIBANK EUROPE PLC ATHENS, GREECE 7007 MARINE MANAGEMENT SERVICES

2. CITIBANK EUROPE PLC ATHENS, GREECE 7023 MARINE MANAGEMENT SERVICES

3. CITIBANK NA NEW YORK USA 2628 MARINE MANAGEMENT SERVICES

4. ALPHA BANK PIRAEUS, GREECE 3657 MARINE MANAGEMENT SERVICES

5. ALPHA BANK PIRAEUS, GREECE 7379 MARINE MANAGEMENT SERVICES

6. NATIONAL BANK OF GREECE PIRAEUS, GREECE 66-09

MARINE MANAGEMENT SERVICES

7. NATIONAL BANK OF GREECE PIRAEUS, GREECE 7899

MARINE MANAGEMENT SERVICES

8. DNB NOR BANK LONDON, UK 3002 MARINE MANAGEMENT SERVICES

9. DNB NOR BANK LONDON, UK 3001 MARINE MANAGEMENT SERVICES

MARINE MANAGEMENT BULK SERVICES

1. AEGEAN BALTIC BANK PIRAEUS, GREECE 002-8 MARINE MANAGEMENT BULK SERVICES

2. AEGEAN BALTIC BANK PIRAEUS, GREECE 001-7 MARINE MANAGEMENT BULK SERVICES


Exhibit “A” UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ---------------------------------------------------------------x : In re: : Chapter 11 : TOISA LIMITED, et al., : Case No. 17-10184 (___) : Debtors.1 : (Joint Administration Pending) : ---------------------------------------------------------------x

INTERIM ORDER (I) AUTHORIZING CONTINUED USE OF EXISTING CASH MANAGEMENT PRACTICES, BANK ACCOUNTS, AND BUSINESS FORMS, (II)

WAIVING INVESTMENT AND DEPOSIT REQUIREMENTS, AND (III) AUTHORIZING CONTINUANCE OF INTERCOMPANY TRANSACTIONS

Upon the motion (the "Motion")2 of the Debtors for entry of an order (this

"Order") under sections 105, 345, 362, 363, 364, 503, 1107, and 1108 of title 11 of the

United States Code (the “Bankruptcy Code”): (a) authorizing the Debtors to continue

using their existing Cash Management Practices, Bank Accounts, and Business Forms,

in each case subject to changes that they may make thereto in their sole discretion;

(b) waiving any applicable investment and deposit requirements; and (c) authorizing

the continuance of intercompany transactions and, to the extent applicable, granting

administrative expense status to postpetition intercompany claims between and among

the Debtors pursuant to Bankruptcy Code section 503(b)(1); and upon consideration of

the First-Day Declaration; and due and sufficient notice of the Motion having been

given under the particular circumstances; and it appearing that no other or further

notice is necessary; and it appearing that the relief requested in the Motion is in the best 1 The Debtors are as follows: Trade Prosperity, Inc.; Toisa Limited; United Courage, Inc.; Trade

Vision, Inc.; United Journey, Inc.; United Kalavryta, Inc.; Trade Sky, Inc.; Trade Industrial Development Corporation; United Honor, Inc.; Trade Will, Inc.; United Leadership Inc.; United Seas, Inc.; United Dynamic, Inc.; United Emblem, Inc.; United Ideal Inc.; Trade Unity, Inc.; Trade Quest, Inc.; Trade Spirit, Inc.; Trade Resource, Inc.; United Ambassador, Inc.; Edgewater Offshore Shipping, Ltd.; United Banner, Inc.; Toisa Horizon, Inc.; and Trade and Transport Inc.

2 Capitalized terms not otherwise defined herein shall have the meanings ascribed to such terms in the Motion or the First-Day Declaration.

17-10184 Doc 8-4 Filed 01/29/17 Entered 01/29/17 23:27:24 Exhibit A: Proposed Cash Management Interim Order Pg 1 of 6

2

interests of the Debtors, their estates, their creditors, and other parties in interest; and

after due deliberation thereon; and good and sufficient cause appearing therefor; it is

hereby

ORDERED, ADJUDGED, AND DECREED THAT:

1. The Motion is GRANTED as set forth herein on an interim basis for

forty-five (45) days; provided, however, that such extension is without prejudice to the

Debtors' right to request further interim relief in these cases.

2. The Debtors are authorized to continue their Cash Management

Practices, the Bank Accounts (including, without limitation, the Bank Accounts

identified in Schedule 3 to the Motion), and to the extent such practices and/or Bank

Accounts do not comply with applicable requirements under section 345 of the

Bankruptcy Code, the U.S. Trustee Guidelines, or otherwise, such requirements under

section 345 of the Bankruptcy Code, the U.S. Trustee Guidelines, or otherwise are

waived. Notwithstanding the U.S. Trustee Guidelines or any other applicable

constraint, the Debtors are authorized to continue using the Business Forms in the

ordinary course of business. The Debtors may transfer funds in, out of, and through the

Bank Accounts in accordance with their Cash Management Practices using the Ordinary

Transfer Methods in accordance with the agreements governing the Bank Accounts,

including, without limitation, any Bank Account Agreements. In connection with the

ongoing utilization of their Cash Management Practices, the Debtors and Managing

Agents shall continue to maintain records with respect to all transfers of cash, including

without limitation the Intercompany Transfers, so that all transactions are adequately

documented and readily ascertainable.

3. The Debtors are further authorized to implement any changes to their

Cash Management Practices that they deem appropriate in their sole discretion,


3

including, without limitation, closing Bank Accounts or opening new bank accounts,

subject to the Bank Account Agreements and on notice to the secured lenders, the Office

of the United States Trustee for the Southern District of New York, and the official

committee of unsecured creditors, if any, and consistent with any other orders that the

Court has entered.

4. The Debtors are authorized to continue using their existing Business

Forms without reference to the Debtors’ status as debtors in possession for an interim

period of forty-five (45) days; provided, however that the Debtors will make reasonable

best efforts to include a reference to their status as debtors in possession on any

Business Form.

5. The Debtors are authorized to enter into and engage in the

Postpetition Intercompany Transactions and, subject to entry of a final Order, to take

any actions and to pay prepetition obligations related thereto. All postpetition

payments from a Debtor to another Debtor, or from a Managing Agent to a Debtor, and

vice versa, related to or in connection with any Postpetition Intercompany Transaction,

are hereby accorded administrative expense status or shall be accounted for in

satisfaction of an administrative claim.

6. The Debtors are authorized, but not directed, to pay and/or reimburse

the Banks in the ordinary course of business for any claims arising prior to or after the

Petition Date in connection with Bank Account Claims.

7. The Debtors are authorized, but not directedto pay Management Fees

due and owing, whether accrued pre- or post-petition, in accordance with the terms of

the underlying Management Agreements; provided, however, any payment of pre-

petition Management Fees shall be subject to entry of a final Order granting the relief

requested in the Motion.


4

8. The Banks are authorized and directed to (a) continue administering

the Bank Accounts in the usual and ordinary course of business in accordance with the

Debtors' instructions and pursuant to the Bank Account Agreements, (b) pay any and

all checks, drafts, wires, or electronic funds transfers presented, issued, or drawn on the

Bank Accounts on account of any claims arising prepetition or postpetition so long as

sufficient funds are available in such Bank Accounts unless the Debtors specifically

issue "stop payment" instructions with respect to such items in accordance with the

terms of the Bank Account Agreements, (c) honor the Debtors' directions with respect to

the opening or closing of any Bank Account, and (d) accept and hold, or invest, the

Debtors' funds in accordance with the Debtors' instructions.

9. Such Banks may rely on this Order and on the Debtors'

representations and instructions as to the payments and transfers that may be honored

or dishonored in accordance with the terms of the Bank Account Agreements. The

Banks shall not be liable to any party on account of (a) following the Debtors’

instructions or representations as to any order of the Court and (b) honoring any

checks, drafts, wires or electronic funds transfers presented in a good faith belief that

the Court has authorized the honoring of such checks, drafts, wires, or electronic funds

transfers.

10. This Order shall apply to any and all Bank Accounts of the Company

that are used consistently with the Cash Management Practices, even if such Bank

Accounts do not appear on the list attached as Schedule 3 to the Motion. Any and all

accounts opened by the Debtors on or after the Petition Date at any Bank shall be

deemed a Bank Account (as if it had been opened prior to the Petition Date and listed

on Schedule 3 to the Motion) and any and all Banks at which such accounts are opened

shall similarly be subject to the rights and obligations of this Order.


5

11. To the extent any other order is entered by the Court directing Banks

to honor checks, drafts, automated clearing house transfers, or other electronic funds

transfers or any other withdrawals made, drawn, or issued in payment of prepetition

claims, the obligation to honor such items shall be subject to this Order, provided,

however, notwithstanding anything to the contrary contained herein, any payment to

be made, or authorization contained, hereunder shall be subject to the requirements

imposed on the Debtors under any approved order regarding the use of cash collateral

and any budget in connection therewith.

12. Notwithstanding the relief granted in this Order, any payments

made by the Debtors pursuant to the authority granted herein shall be subject to any

order authorizing the use of post-petition financing and cash collateral.

13. The requirements of Bankruptcy Rule 6003(b) are satisfied by the

contents of the Motion or otherwise deemed waived.

14. Notwithstanding any stay that might be imposed by Bankruptcy

Rule 6004(h) or otherwise, this Order shall be effective and enforceable immediately

upon entry hereof.

15. The Debtors shall serve a copy of the Motion and this Order within

three (3) business days after entry thereof by fax, electronic mail, or overnight mail, on

the Notice Parties (as defined below). Any objections to the Motion and entry of a final

order thereon (the "Final Order") must be filed with the Court and served on the

following parties (the "Notice Parties") so as to be actually received by ____________ __,

2017 at 5:00 p.m. (Prevailing Eastern Time):

(a) the Debtors, c/o Brokerage and Management Corporation, NY Agency of Marine Management Services, M.C., 40 Wall Street, New York, NY 10005;


6

(b) counsel to the Debtors, Togut, Segal & Segal LLP, One Penn Plaza, Suite 3335, New York, NY 10119, Attn: Frank A. Oswald and Brian F. Moore ([email protected] and [email protected]);

(c) the Office of the United States Trustee, U.S. Federal Office Building, 201 Varick Street, Suite 1006, New York, NY 10014,

(d) the Debtors' material prepetition secured lenders;

(e) the parties listed in the consolidated list of the thirty (30) largest unsecured creditors filed by the Debtors in these chapter 11 cases, or if any official committee of unsecured creditors has been appointed, counsel to such committee; and

(f) counsel to any other official committee appointed in these bankruptcy cases. 16. The final hearing on the Motion shall be on _______________ __, 2017

at __:__ _.m. (Prevailing Eastern Time). The Court may enter the Final Order without

further notice or hearing if no objections are timely filed and served.

17. The requirements set forth in Local Bankruptcy Rule 9013-1(b) are

satisfied by the contents of the Motion.

18. Notwithstanding the possible applicability of Bankruptcy Rules

6004(a) and 6004(h) or otherwise, this Order shall be immediately effective and

enforceable upon its entry.

19. The Debtors are authorized and empowered to take all actions

necessary to implement the relief granted in this Order.

20. This Court shall retain jurisdiction with respect to all matters arising

from or related to the implementation, interpretation, or enforcement of this Order.

Dated: New York, New York , 2017

UNITED STATES BANKRUPTCY JUDGE


Exhibit B

Marine Management Agreement

17-10184 Doc 8-5 Filed 01/29/17 Entered 01/29/17 23:27:24 Exhibit B: Marine Management Agreement Pg 1 of 8








Exhibit C

Sealion Management Agreement

17-10184 Doc 8-6 Filed 01/29/17 Entered 01/29/17 23:27:24 Exhibit C: Sealion Management Agreement Pg 1 of 49

Addendum No. 21 Dated 24th November 2014

To the Management Agreement dated 28th November 1989 As amended 2nd January 1997 and 15th September 1997

Between

Toisa Limited, whose principle place of business is situated at 2 Skouze Str & Akti Miaouli, 18536 Piraeus, Greece (Owners)

And

Sealion Shipping Limited, whose principle place of business is situated at Gostrey House, Union Road, Farnham, Surrey GU9 7PT, England (Managers)

1. In accordance with Clause 7 (a) and Clause 7 (i) of the above captioned Management Agreement, it is hereby extended by a further five (5) years from 29th November 2014 to 29th November 2019.

2. All other terms and conditions remain in full force and are unaltered

Signed by

In the presence of In the presence of

........t)...................... \

















































Exhibit D

Cash Management System Chart

17-10184 Doc 8-7 Filed 01/29/17 Entered 01/29/17 23:27:24 Exhibit D: Cash Management System Chart Pg 1 of 2

Tanker and Bulker Charter Receipts

Day to Day Tanker and

BulkerOperating Expenses

Tanker/Bulker Silo

Lender Retention Accounts

Toisa Limited (Debtor)

Bank AccountGoldman Sachs,

London

Toisa Limited (Debtor)

Deposit Bank Account

Lloyds, London

Sealion Shipping Limited**

Bank AccountHSBC, London

Offshore Vessel

Charter Receipts

Oceangoing Business(Tanker and Bulker) Offshore Business

(Vessels)

United Grace

United Carrier

United Fortitude

United Kalavryta

United Ambassador

United Banner

Trade Vision

United Honor

United Journey

United EmblemUnited Seas

Toisa Independent

Trade Unity

Trade Spirit

Toisa Pisces

Toisa Limited

Trade Will

United Leadership

Trade Quest

Trade Resource

United Dynamic

United Ideal

TOISA LIMITED CASH MANAGEMENT/FLOW OF FUNDS

Marine Management Bulk Services

Inc.**

Day to Day Operating Expenses(Offshore)

Offshore Silo Lender Retention Accounts

Offshore Vessel

Charter Receipts

Sealion Shipping Limited** Toisa Limited Bank

Sub-AccountHSBC, London

Sealion De Corcovado**

Sealion PTE**

Sealion Amazonia**

**Non-debtors

Trade and Transport

Inc. (Intermediate Holding Company)

Trade Prosperity

Trade and Transport (UK) Ltd. (Agent)**

Brokerage and Management Corporation**

(NY Agent)

Marine Management Services, M.C.

(“MMS”)** Bank AccountCiti, New York

MMS Disbursement

Account Greece**

17-10184 Doc 8-7 Filed 01/29/17 Entered 01/29/17 23:27:24 Exhibit D: Cash Management System Chart Pg 2 of 2

Documents

SOUTHERN DISTRICT OF NEW YORK TOISA LIMITED, et al.,