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Full title: Objection by Interested Party STIHL Incorporated to 14 Miscellaneous motion (first day motions only). Proof of service. (Lahn, Connie) (Entered: 01/13/2021)

Document posted on Jan 12, 2021 in the bankruptcy, 5 pages and 0 tables.

Bankrupt11 Summary (Automatically Generated)

TO SECTION 506(B)(9) OF THE BANKRUPTCY CODE ________________________________________________________________________________________________________ STIHL Incorporated (“STIHL”) submits this objection (“Objection”) to the Motion of Tea Olive I, LLC d/b/a Stock+Field (“Debtor”) for an Order (I)Before the Petition Date, on September 24, 2019, Debtor executed a Credit Application, which granted STIHL a purchase money security interest (“PMSI”) under the Uniform Commercial Code in the all products sold by STIHL to Debtor.The collateral subject to STIHL’s security interest includes, without limitation: chain saws, bars and chain, trimmers and brushcutters, augers, hedge trimmers, hand tools, power brooms, blowers and sprayers, edgers cut-off machines, pole pruners, multi-task tools, oil and lubricants, spare parts, protective equipment, accessories and related items, and all proceeds of (including insurance proceeds) and accounts receivables relating to such products, whether now owned or hereafter acquired (“Collateral”).Under the 2020 Midwest STIHL Policies and Procedures, payments are made at the direction of STIHL to Midwest STIHL’s address; however, Midwest STIHL is not a separate legal entity and is merely a trade name that STIHL does business under.However the whole purpose of STIHL’s reclamation rights under section 546(c) of the Bankruptcy Code is for STIHL to recover its Collateral.

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UNITED STATES BANKRUPTCY COURT DISTRICT OF MINNESOTA ________________________________________________________________________________________________________ In re: Tea Olive I, LLC d/b/a Stock+Field, Case No.: 21-30037 Debtor. Chapter 11 ________________________________________________________________________________________________________ STIHL INCORPORATED’S OBJECTION TO DEBTOR’S MOTION FOR ORDER (I) GRANTING EXPEDITED RELIEF AND (II) ESTABLISHING PROCEDURES FOR THE RESOLUTION OF RECLAMATION CLAIMS AND ADMINISTRATIVE CLAIMS PURSUANT TO SECTION 506(B)(9) OF THE BANKRUPTCY CODE ________________________________________________________________________________________________________ STIHL Incorporated (“STIHL”) submits this objection (“Objection”) to the Motion of Tea Olive I, LLC d/b/a Stock+Field (“Debtor”) for an Order (I) Granting Expedited Relief And (II) Establishing Procedures For The Resolution Of Reclamation Claims And Administrative Claims Pursuant To Section 506(B)(9) Of The Bankruptcy Code (“Motion”). [ECF No. 14.] In support thereof, STIHL states as follows: STIHL’s Interests in the Collateral and Debtor’s Default 1. Debtor filed a voluntary petition for relief under chapter 11 of title 11 of the United States Code (“Bankruptcy Code”) on January 10, 2021 (“Petition Date”). 2. Before the Petition Date, on September 24, 2019, Debtor executed a Credit Application, which granted STIHL a purchase money security interest (“PMSI”) under the Uniform Commercial Code in the all products sold by STIHL to Debtor. The collateral subject to STIHL’s security interest includes, without limitation: chain saws, bars and chain, trimmers and brushcutters, augers, hedge trimmers, hand tools, power brooms, blowers and sprayers, edgers cut-off machines, pole pruners, multi-task tools, oil and lubricants, spare parts, protective equipment, accessories and

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related items, and all proceeds of (including insurance proceeds) and accounts receivables relating to such products, whether now owned or hereafter acquired (“Collateral”). [See ECF No. 36, Exhibit A .] 3. STIHL perfected its security interest in the Collateral under the Credit Application by filing a UCC-1 Financing Statement, file number 1143474000030, with the Minnesota Secretary of State on February 20, 2020. [See ECF No. 36, Exhibit B.] 4. Accordingly, STIHL holds a valid, perfected security interest in the Collateral and any proceeds from Debtor’s sale of the Collateral. See Minn. Stat. § 336.9-324. STIHL has priority over any conflicting security interest in the same inventory. Id. 5. Under the 2020 Midwest STIHL Policies & Procedures, which governed the Credit Application, the relationship between Debtor and STIHL can be terminated if there are payment defaults. Specifically, STIHL, “[r]eserves the right to terminate the supply relationship with any dealership shown not to be credit worthy.” [See ECF No. 36, Exhibit C, page 20; Past Due Account, page 21.] In addition to the right to terminate the supply relationship, “STIHL has the right in its sole discretion, to terminate at any time any credit extended to the Dealer.” [See ECF No. 36, Exhibit A, page 2 at ¶ 3.] 6. Certain of the Debtor’s stores that are subject to the Debtor’s Motion are within the territory of the Midwest STIHL corporate branch and are subject to the 2020 Midwest STIHL Policies and Procedures. Under the 2020 Midwest STIHL Policies and Procedures, payments are made at the direction of STIHL to Midwest STIHL’s address; however, Midwest STIHL is not a separate legal entity and is merely a trade name that STIHL does business under. 7. Before the Petition Date, Debtor became substantially behind on its invoices such that STIHL sent Debtor two termination letters—a Notice of Termination of Supply Relationship dated December 28, 2020, and a Notice of Cancellation dated January 4, 2021.

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8. As of the Petition Date, STIHL was owed no less than $230,000.00. The Motion 9. On January 11, 2021, Debtor filed the Motion whereby it seeks, among other things, permission to establish exclusive procedures for claimants to repossess their goods, which would include STIHL’s Collateral. 10. Debtor is proposing a procedure to address reclamation and 20-day claims. STIHL would not be able to repossess goods outside of these procedures. Per the procedures, STIHL would have 60 days to file a reclamation demand using the Claims Form; Debtor would have 120 days to file its Notice. [See ECF No. 14 at 5-6.] STIHL would then have 20 days to file its Notice Objection. [Id.] 11. In the Motion, Debtor expressly says the purpose of these suggested procedures is to not interfere with the sale of its assets. [See ECF No. 14 at page 3, paragraph 11.] However the whole purpose of STIHL’s reclamation rights under section 546(c) of the Bankruptcy Code is for STIHL to recover its Collateral. The Objection 12. STIHL objects to the Motion to the extent Debtor seeks the authority to sell the Collateral before STIHL can repossess the Collateral. 13. Section 546(c) of the Bankruptcy Code authorizes “a seller of goods that has sold goods to the debtor, in the ordinary course of such seller’s business, to reclaim such goods if the debtor has received such goods while insolvent, within 45 days before the date of the commencement of a case under this title.” 11 U.S.C. § 546(c). 14. The Motion states that a seller such as STIHL would not be able to repossess goods outside of its procedures. [ECF No. 14 at 4.]

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15. STIHL objects on the grounds that Debtor seeks to liquidate by the end of March, and the procedures set forth in the Motion effectively precludes and delays STIHL’s ability to recover the Collateral. 16. STIHL incorporates by reference the objections STIHL filed at ECF Nos. 34 and 36. WHEREFORE, STIHL requests that Debtor’s Motion be denied and that the Court grant such other relief as is just and appropriate. Dated: January 13, 2021. Respectfully Submitted, BARNES & THORNBURG LLP /e/ Connie A. Lahn Connie A. Lahn (#0269219) Molly N. Sigler (#0399122) Barnes & Thornburg LLP 2800 Capella Tower 225 South Sixth Street Minneapolis, MN 55402-4662 Telephone: (612) 333-2111 Facsimile: (612) 333-6798 Connie.Lahn@btlaw.com Molly.Sigler@btlaw.com

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UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF MINNESOTA In re: Tea Olive I, LLC, d/b/a Stock+Field, Bky. No. 21-30037 (WJF) Debtor. Chapter 11 Case UNSWORN CERTIFICATE OF SERVICE The undersigned hereby certifies under penalty of perjury that on January 13, 2021, she electronically filed the attached Objection, thereby causing the following parties to be served by CM/ECF at the addresses set forth below: CM/ECF: Samuel M. Andre sandre@fredlaw.com, stimm@fredlaw.com; sstallings@fredlaw.com, autodockets@fredlaw.com James C. Brand jbrand@fredlaw.com, stimm@fredlaw.com, autodockets@fredlaw.com Clinton E. Cutler ccutler@fredlaw.com, stimm@fredlaw.com, sstallings@fredlaw.com, autodockets@fredlaw.com Steven E. Fox sfox@riemerlaw.com Steven R. Kinsella skinsella@fredlaw.com, sstallings@fredlaw.com; autodockets@fredlaw.com Steven W Meyer smeyer@foxrothschild.com Paul L. Ratelle pratelle@fwhtlaw.com, lsmith@fwhtlaw.com George H. Singer singerg@ballardspahr.com, johnsonma@ballardspahr.com Kesha L. Tanabe kesha@tanabelaw.com, kesha.tanabe@gmail.com Sarah J. Wencil Sarah.J.Wencil@usdoj.gov Executed: January 13, 2021 By: /e/ Connie A. Lahn Connie A. Lahn