IN THE UNITED STATES BANKRUPTCY COURT SOUTHERN

IN THE UNITED STATES BANKRUPTCY COURT SOUTHERN

IN THE UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF INDIANA INDIANAPOLIS DIVISION In re: Kiel Bros. Oil Company, Inc., KP Oil, Inc. Debtors. )...

17KB Sizes 0 Downloads 4 Views

IN THE UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF INDIANA INDIANAPOLIS DIVISION In re: Kiel Bros. Oil Company, Inc., KP Oil, Inc. Debtors.

) ) ) ) ) )

Chapter 11 Case No. 04-11121-BHL-11 Jointly Administered

MOTION TO SHORTEN AND LIMIT NOTICE ON DEBTORS' MOTION TO REJECT CERTAIN CONTRACTS ON SHORTENED AND LIMITED NOTICE Kiel Bros. Oil Company, Inc. ("Kiel Bros.") and KP Oil, Inc. ("KP Oil"), the above-captioned debtors and debtors in possession (collectively, the "Debtors"), respectfully request that this Court shorten and limit notice of the Debtors' Motion to Reject Certain Contracts On Shortened and Limited Notice (the "Motion") filed by Debtors on October 15, 2004. In support of the Motion, Debtors represents as follows: Background 1.

On June 15, 2004 (the "Petition Date"), the Debtors filed voluntary

petitions for relief under Chapter 11 of the United States Bankruptcy Code, 11 U.S.C. §§ 101, et. seq. (the "Bankruptcy Code"), commencing these chapter 11 bankruptcy cases (the "Cases"). By Order entered June 15, 2004, the Cases were consolidated for administrative convenience only. 2.

An Official Committee of Unsecured Creditors (the "Committee") has

been appointed by the United States Trustee and is represented by counsel, Otterbour g Steindler Houston & Rosen, P.C., Ice Miller and financial advisors, KPMG, Inc. 3.

Kiel Bros. is a privately- held, Indiana sub-s corporation, that as of the

Petition Date operated petroleum wholesaling operations ("Wholesale Division") in Indiana,

INIMAN2 887424v1

Kentucky and Ohio, and 201 convenience stores ("C -Store") operations ("C-Store Division") in Indiana, Kentucky and Illinois. 4.

The Wholesale Division manages Kiel Bros.' dealer network, petroleum

transportation, and all real estate, including operated C-Store real estate. Operating performance of the Wholesale division is divided into two regions, Indiana and Kentucky/Ohio. The Indiana region is predominately Marathon branded dealers and the Kentucky/Ohio region is predominately BP branded dealers. Kiel Bros. transports virtually all petroleum products using its own vehicles and had as of the Petition Date combined annual sales of 193,000,000 gallons of light petroleum products. The Wholesale Division currently 1 manages approximately 163 CStore properties as well as other properties, including 21 dealer locations, 27 closed C-Store locations, 6 former C-Store locations now leased to non C-Store tenants, 23 bulk plant locations 2 and 8 other properties, including the corporate office and vacant land (collectively, the "Managed Properties"). 5.

The C-Store Division operates approximately 162 convenience stores with

current combined annualized non-fuel sales of $168,000,000 and fuel sales of $160,000,000. Most of the C-Stores operate under the trade name "Tobacco Road" and sell petroleum products under the Marathon or BP brand. A few of the C-Stores are unbranded. 6.

The ownership of the Managed Properties is primarily vested in KP Oil, a

c-corporation formed in 1977 to acquire the ARCO operations in Louisville, Kentucky. KP Oil is a real estate holding company without employees. In 1994, the operational functions of Kiel 1

Since the Petition Date, the Debtors obtained orders authorizing the Debtors to reject up to 60 leases of C-Store locations. Substantially all of these leases, with few exceptions, have been rejected.

2

The bulk plant business consists of heating and other forms of oil typically stored in above-ground storage tanks. The Debtor sold its bulk plant business in February 2001, and does not operate from any of its bulk plant locations. Some of the bulk plant properties are leased to third parties.

- 2887424_1.DOC INIMAN2 887424v1

Bros. and KP Oil were consolidated within Kiel Bros. and the real estate holdings of Kiel Bros. and KP Oil were consolidated within KP Oil. 7.

Kiel Bros. currently employs approximately 1247 hourly employees and

212 salaried employees. The employees are located in three states, with the vast majority located in southern Indiana (more than 600 hourly and more than 119 salaried).

Jurisdiction; Statutory Basis For Relief 8.

The Court has jurisdiction over this matter under 28 U.S.C. §§ 157 and

1334. Venue is proper under 28 U.S.C. §§ 1408 and 1409. This is a core proceeding under 28 U.S.C. § 157(b)(2). 9.

The statutory basis for the relief requested herein is Section 105(a) of the

Bankruptcy Code and Rules 2002(m) and 9007 of the Federal Rules of Bankruptcy Procedure (the "Bankruptcy Rules"). Relief Requested 10.

An emergency exists which justifies the shortening and limitation of

notice to only those parties set forth in the Certificate of Service below in order that a hearing may be held herein on the Motion at 1:30 a.m. on October 25, 2004, in that the payments may become due on November 1, 2004 on the Contracts 3 Debtors seek to reject under the Motion. 11.

Debtors will cause the Motion and Notice of Hearing to be served by

expedited delivery to each of the parties identified below on October 15, 2004. WHEREFORE, Debtors request that the Court limit notice of the Motion to the Twenty Largest Creditors, counsel of record, intervenors, the U.S. Trustee, counsel for the 3

Capitalized terms not defined herein shall have the meaning ascribed to them in the Motion.

- 3887424_1.DOC INIMAN2 887424v1

Committee and the affected Counterparties identified in the Motion and shorten notice as described herein. Respectfully submitted, BAKER & DANIELS

By: /s/Terry E. Hall Attorneys for the Debtor Jay Jaffe (#5037-98) John F. W. Fleming (#24182-49) 600 East 96th Street, Suite 600 Indianapolis, Indiana 46240 Telephone: (317) 569-9600 Facsimile: (317) 569-4800 Terry E. Hall (#22041-49) 300 North Meridian Street, Suite 2700 Indianapolis, Indiana 46204 Telephone: (317) 237-0300 Facsimile: (317) 237-1000

- 4887424_1.DOC INIMAN2 887424v1

CERTIFICATE OF SERVICE The undersigned hereby certifies that the foregoing was served this 15th day of October, 2004, by facsimile and/or prepaid overnight delivery on the following: Twenty Largest Creditors Counsel of record Intervenors U.S. Trustee Official Committee of Unsecured Creditors' counsel Affected Counterparties identified in the Motion

/s/Terry E. Hall

- 5887424_1.DOC INIMAN2 887424v1