Trinity Auto - Chapter 11 Bidding Procedures Summary

Bidding Procedures / Asset Purchase Agreement Summary

Parties Involved

• Seller: Trinity Auto, LLC d/b/a Trinity Cadillac, Debtor-in-Possession (Case No. 26-10018-SLM)
• Stalking Horse Bidder: Leonard Tarzia, or his assign
• Fulton Bank: Referenced throughout as a consulted party. The Debtor is required to consult with counsel to Fulton Bank when evaluating Qualified Bids and identifying the Baseline Bid, and counsel to Fulton Bank is a Notice Party under the Amended Order.
• The Stalking Horse Bidder is not an insider or affiliate of the Debtor, as those terms are defined in section 101 of the Bankruptcy Code, and no common identity of incorporators, officers, directors, or stockholders exists between the parties.
• The Stalking Horse Bidder and its counsel and advisors have acted in good faith within the meaning of section 363(m) of the Bankruptcy Code in connection with negotiation of the Stalking Horse APA.
• General Motors LLC (GM) retains rights pursuant to the Dealer Sales and Services Agreement (DSSA), the Recovery Agreement dated July 7, 2021, and the New Jersey Franchise Practices Act in connection with proposed changes in ownership or transfer of dealership assets. To the extent GM submits a bid consistent with the Bid Procedures, GM shall also be deemed a Qualified Bidder for all purposes.
• Debtor's Counsel: Genova Burns LLC (Daniel M. Stolz, Esq.; Donald W. Clarke, Esq.; Susan A. Long, Esq.; R. Edward Stone III, Esq.), 110 Allen Road, Suite 304, Basking Ridge, NJ 07920
• Stalking Horse Bidder's Counsel: Stevan H. LaBonte, Esq., LaBonte Law Group, PLLC, 333 Jericho Tpke, Suite 200, Jericho, NY 11753

Assets Being Sold

• The Debtor seeks to sell substantially all of its assets, including:
  • All PP&E set forth on Schedule 4.18, except for items denoted by an asterisk;
  • Parts and accessories inventory, including: (i) all new, undamaged, current Cadillac genuine OEM parts and accessories; (ii) all Cadillac parts and accessories outside that scope; (iii) non-Cadillac parts and accessories inventory; and (iv) gas, grease, and oil inventories and supplies. An inventory shall be conducted immediately prior to closing by a mutually acceptable inventory service, with costs split equally. At closing, the Seller shall assign to the Buyer any termination rights to return Cadillac parts and accessories to GM pursuant to the Dealer Agreement;
  • All deposits, customer and security deposits, advances, prepayments, promotional allowances, vendor rebates and other refunds, claims, causes of action, rights of recovery, rights under warranties and guaranties, and rights of set-off and recoupment relating to the business and/or acquired assets;
  • All assumed contracts, including the Master Lease;
  • All documents and business records related to the business and/or acquired assets, to the extent reasonably available, not subject to attorney-client privilege, and permitted by law;
  • All permits and related rights and privileges, to the extent transferable or assignable;
  • All insurance policy claims and proceeds relating to the acquired assets (excluding those relating to excluded assets);
  • Tax refunds, rebates, abatements, credits, and similar items relating to any period beginning on or after the closing date;
  • Any claim, right, or interest in the corporate name "Trinity Cadillac" and any other corporate name used in connection with the business;
  • Rights under non-disclosure, confidentiality, non-compete, non-solicitation, or invention agreements with transferred employees, former employees, and other persons, to the extent relating to the business post-closing;
  • Rights under warranties, representations, and guarantees made by vendors, suppliers, manufacturers, and contractors relating to acquired assets;
  • All business records (with the Seller permitted to retain copies for bankruptcy compliance purposes);
  • Goodwill of the Seller relating to the business;
  • All rights in respect of promotional allowances, vendor rebates, and other refunds related to acquired assets or assumed liabilities;
  • All telephone numbers used in connection with the business;
  • All sales and promotional materials, catalogues, and advertising literature; and
  • Those additional assets listed on Schedule 2.1(r), excluding all excluded assets.
• The assets are being sold free and clear of all liens, claims, interests, encumbrances, and successor liability to the greatest extent permitted by the Bankruptcy Code and applicable non-bankruptcy law, pursuant to section 363 of the Bankruptcy Code.

Stalking Horse Bid

• Purchase Price: $4,500,000
• The Stalking Horse APA is the only, and thus the highest or otherwise best, offer the Debtor has received to date as a result of its marketing efforts.
• The Stalking Horse Bidder shall be deemed a Qualified Bidder and the Stalking Horse APA shall be deemed a Qualified Bid, subject to GM's approval rights as acknowledged in the Stalking Horse APA.
• Court approval of the sale under the Stalking Horse APA is subject to GM's approval rights and the exercise by GM of its rights pursuant to Article 12 of the DSSA. Final approval of the sale is reserved for the Sale Hearing.
• The Stalking Horse APA includes an express condition that the Buyer shall have obtained GM approval to operate the business at the premises on standard terms customarily provided by GM to its dealers.

Bid Protections

• Break-Up Fee: 3% of the Purchase Price (approximately $135,000)
• Expense Reimbursement: up to $50,000
• The Bid Protections are approved as actual and necessary administrative expenses, payable immediately upon consummation of any alternative transaction. Any overbid alternative transaction (including any credit-bid transaction) must include a cash component sufficient to pay the Bid Protections in full, with such amounts paid directly from the proceeds of such transaction.
• No party other than the Stalking Horse Bidder is entitled to any expense reimbursement, break-up fee, topping or termination fee, or similar payment. By submitting a bid, a party is deemed to have waived any such right.
• Any amendments to the Bid Protections or Bid Procedures that purport to modify or amend GM's rights require GM's prior written consent.

Credit Bid

• Any Qualified Bidder holding a valid, undisputed, and perfected lien on any acquired assets may credit bid all or a portion of its allowed secured claims pursuant to section 363(k) of the Bankruptcy Code, provided that such credit bid includes a cash component sufficient to pay in full all claims secured by senior, valid, perfected, and unavoidable liens on the acquired assets (unless the senior lienholder consents to alternative treatment).
• A Secured Creditor must provide cash consideration for any assets acquired that do not constitute collateral securing its claims.
• In the event of a competing Qualified Bid, the Stalking Horse Bidder is entitled, but not obligated, to submit overbids and to credit bid (a) all or a portion of the secured portion of its claims and (b) the value of the Bid Protections.

Good Faith Deposit

• Each bid must be accompanied by a good faith deposit equal to 10% of the proposed cash purchase price, submitted by wire transfer.
• Deposits will be held in escrow and shall not constitute property of the Debtor's estate absent further court order.
• The Winning Bidder's deposit will be credited toward the purchase price upon closing.
• If the Winning Bidder fails to consummate the sale due to its breach, the deposit will be irrevocably forfeited to the Debtor as liquidated damages, in addition to any other available remedies.
• Deposits of unsuccessful bidders (other than the Back-Up Bidder) will be returned promptly following the close of the Auction. The Back-Up Bidder's deposit will be returned as soon as possible after closing with the Winning Bidder.

Bid Requirements

• To become an Acceptable Bidder eligible for due diligence and bid submission, a Potential Bidder must deliver to Debtor's counsel:
  • An executed confidentiality agreement in form and substance acceptable to the Debtor;
  • Sufficient evidence of cash on hand or non-contingent debt and/or equity funding commitments to consummate the purchase;
  • A statement disclosing any joint bid arrangements and the identity of any co-bidding parties; and
  • A non-binding indication of interest by Feb. 12, 2026, at 5:00 p.m. ET, including the proposed transaction structure, acquiring entity description, connections to the Debtor, disclosure of substantial interest holders, evidence of financial capacity, confirmation of authority, due diligence requirements, proposed timetable, and contact information. Failure to meet this deadline does not preclude a party from submitting a Qualified Bid.
• To constitute a Qualified Bid, a bid must provide consideration of at least $4,735,000 (comprising the $4,500,000 Purchase Price, plus the $135,000 Break-Up Fee, plus the $50,000 Expense Reimbursement, plus the $50,000 Minimum Overbid Increment) and must satisfy the following requirements:
  • Identify the specific assets to be purchased, liabilities and cure costs to be assumed, and contracts to be assumed;
  • Include a clean and marked-up copy of the proposed asset purchase agreement against the Stalking Horse APA, and a marked-up draft Sale Order;
  • Set forth the purchase price as a single-point U.S. Dollar value on a cash-free, debt-free basis, identifying all cash and non-cash components;
  • Include a 10% good faith deposit by wire transfer;
  • Contain a statement that the bid does not entitle the party to any break-up fee, termination fee, expense reimbursement, or similar payment, and include a waiver of any substantial contribution claim under section 503(b);
  • Not be conditioned on financing or completion of due diligence; all diligence must be completed prior to the Bid Deadline;
  • Be formal, binding, unconditional, and irrevocable until the Debtor notifies the bidder that it is not the Winning Bid or Back-Up Bid. If designated as Back-Up Bidder, the bid remains irrevocable until the earlier of (a) two business days after closing with the Winning Bidder or (b) 90 days after entry of the sale order approving the Winning Bid;
  • Include evidence of necessary corporate authorizations and approvals;
  • Include evidence of the bidder's preparedness to close without contingency on government or regulatory approvals, together with a plan to obtain any required approvals (including CFIUS) and the proposed timing therefor;
  • Include written evidence of financial ability to consummate the sale and provide adequate assurance of future performance under assumed contracts;
  • Contain a written acknowledgment of non-collusion, agreement to abide by the Bid Procedures, and consent not to submit further bids or reopen the Auction after its conclusion;
  • Provide that the Debtor has the right to pursue all available damages in the event of the bidder's breach; and
  • Be based on the Stalking Horse Bid and exceed it on its own terms or, for subset bids, in combination with another Qualified Bid. Joint bids submitted by multiple bidders will not be considered.

Overbid

• Bidding at the Auction commences at the Starting Bid (the highest or best Qualified Bid as determined prior to the Auction).
• Minimum Overbid Increment: $50,000 above the Starting Bid, and $50,000 above each subsequent Overbid. The Debtor reserves the right to reduce or increase the Minimum Overbid Increment in its discretion.
• The Stalking Horse Bidder may credit the value of the Bid Protections when determining whether it has topped the previous bid by the required increment.

Auction Details

• The Auction will be held at the offices of Genova Burns LLC, 494 Broad Street, 6th Floor, Newark, New Jersey 07102, on Feb. 19, 2026, at 9:00 a.m. ET. Remote access and participation will be supported.
• Participation is limited to the Debtor, the U.S. Trustee, Qualified Bidders (including GM), counsel to any statutory committees, and their respective representatives and professionals.
• If no Qualified Bids other than the Stalking Horse Bid are received prior to the Bid Deadline, the Debtor may, subject to GM's approval rights, cancel the Auction and declare the Stalking Horse Bid as the Winning Bid.
• By Feb. 18, 2026, at 4:00 p.m. ET (the Baseline Bid Deadline), the Debtor, in consultation with GM, Fulton Bank, and any statutory committees, will evaluate Qualified Bids and identify the Baseline Bid, notifying the Stalking Horse Bidder, Notice Parties, and all Qualifying Bidders accordingly.
• The Auction will be conducted openly, transcribed, and documented, recorded, or videotaped in accordance with Local Rule 6004-2(c)(2). Each participating bidder must confirm on the record that it has not engaged in collusion and that its bid is a good faith, bona fide offer.
• The Auction shall continue until the Debtor determines that there is one highest or otherwise best Qualified Bid and that further bidding is unlikely to result in a higher or better offer, at which point the Auction shall close.
• Prior to selecting the Winning Bidder, if GM informs the Debtor in writing that it will not approve a Qualified Bid or the Stalking Horse Bid pursuant to its rights under the DSSA, the Debtor shall not select such bid as the Winning Bid or Back-Up Bid. Court approval of the Winning Bid is similarly subject to GM's approval and/or rights of first refusal under Article 12 of the DSSA.
• In selecting the highest or otherwise best bid, the Debtor may consider, among other factors: total consideration and nature thereof (including assumed liabilities and cure payments), likelihood and timing of closing, employee retention, impact on creditors and contract counterparties, net economic effect, and the degree of deviation from the form purchase agreement.

Winning Bidder and Back-Up Bid

• The Debtor shall file notice of the Winning Bid and Winning Bidder, and Back-Up Bid and Back-Up Bidder, with the Court within one business day after the close of the Auction.
• The Back-Up Bid remains open and binding until the second business day after the closing of the sale with the Winning Bidder (or for such period as required under the Stalking Horse APA if the Stalking Horse Bid is selected as the Back-Up Bid). If the Winning Bidder fails to consummate the sale, the Debtor is authorized, but not required, to designate the Back-Up Bidder as the new Winning Bidder.

Assumption and Assignment

• No later than Feb. 10, 2026, the Debtor shall serve a Contract Assumption Notice on each applicable contract counterparty via first-class mail (and via email on counsel of record), identifying the contract title, counterparty name, estimated cure payments, and applicable objection deadline. Service of the notice does not constitute an admission that a listed contract is executory or that the stated cure amount constitutes a claim, and inclusion on the notice does not guarantee assumption and assignment.
• Objections to the proposed assumption and assignment, the Stalking Horse Bidder's adequate assurance of performance, or the proposed cure payments must be filed and actually received by Feb. 12, 2026, at 4:00 p.m. ET.
• Failure to timely object will be deemed consent to the cure payment, assumption and assignment, and adequate assurance of future performance, and will forever bar the counterparty from asserting additional cure amounts or defaults with respect to the assumed contract.
• If a cure payment dispute cannot be resolved, the contract may nonetheless be assumed and assigned, provided that the contested cure amount is segregated pending resolution by the Court or mutual agreement of the parties.
• No contract shall be deemed assumed and assigned until the sale has closed or, if later, the date the Court has entered an order authorizing such assumption and assignment.
• The Winning Bidder may designate additional contracts to be assumed and assigned, or remove contracts from the list, up to two business days prior to closing or as otherwise provided in the Winning Bid.

Sale Free and Clear

• The assets will be sold free and clear of all liens, claims, interests, encumbrances, and successor liability to the greatest extent permitted by the Bankruptcy Code and applicable non-bankruptcy law, pursuant to section 363 of the Bankruptcy Code.
• Any party that fails to timely object to the sale transaction by the Sale Objection Deadline shall be forever barred from asserting any objection to the sale, including with respect to the transfer of assets free and clear of all liens, claims, encumbrances, and other interests.

Key Dates

• Petition Date: Jan. 2, 2026
• Amended Order Entered: Feb. 5, 2026
• Contract Assumption Notice Service Deadline: Feb. 10, 2026
• Indication of Interest Deadline: Feb. 12, 2026, at 5:00 p.m. ET
• Cure / Assumption Objection Deadline: Feb. 12, 2026, at 4:00 p.m. ET
• Qualified Bid Deadline: Feb. 17, 2026, at 5:00 p.m. ET
• Baseline Bid Deadline: Feb. 18, 2026, at 4:00 p.m. ET
• Auction: Feb. 19, 2026, at 9:00 a.m. ET (Genova Burns LLC, 494 Broad Street, 6th Floor, Newark, NJ)
• Sale Order Filing Deadline: Feb. 20, 2026, at 5:00 p.m. ET
• Sale Objection Deadline: Feb. 20, 2026, at 5:00 p.m. ET
• Sale Hearing: Feb. 24, 2026, at 11:00 a.m. ET
• Note: All dates and deadlines are subject to modification as required to accommodate the schedule of GM and its counsel.