Opinion
Case No. 01-16034 (AJG), Jointly Administere.
July 28, 2005
Richard L. Wasserman (RW-8696), Michael Schatzow (pro hac vice), Frederick W.H. Carter (pro hac vice), VENABLE LLP, Baltimore, Maryland, Special Litigation Counsel for the Reorganized Debtors.
Frank A. Oswald (FAO-1223), Scott E. Ratner (SER-0015), TOGUT, SEGAL SEGAL LLP, New York, New York, Longacre Capital Partners (QP), L.P., by its counsel, EMMET, MARVIN MARTIN, LLP, Martin Eisenberg, New York, New York, Bankruptcy Co-Counsel for the Reorganized Debtors.
WHEREAS, under a commodity swap contract, Pacifica Papers, Inc. ("Pacifica"), the predecessor to Norske Skog Canada Limited, ("Norske Skog") entered into agreements for (i) the sale of commodities and/or (ii) the exchange of cash payments based on the movement of the price(s) of commodities or of indices relating to these commodities (collectively, the "ENA Agreements") with Enron North America Corp. ("ENA");
WHEREAS, on January 18, 2001, Enron Corp. ("Enron") entered into a guaranty in favor of Pacifica (the "ENA Guaranty") whereby Enron guaranteed certain obligations of ENA owing under the ENA Agreements;
WHEREAS, commencing on December 2, 2001 and subsequently thereafter, Enron and certain of its affiliated entities including ENA (collectively, the "Reorganized Debtors") each filed a voluntary petition for relief under chapter 11 of title 11 of the United States Code;
WHEREAS, on October 7, 2002, Norske Skog filed proof of claim number 6894 against ENA in the amount of $2,653,271.00 on account of the amounts allegedly due under the ENA Agreements;
WHEREAS, on October 7, 2002, Norske Skog also filed proof of claim number 6893 against Enron in the amount of $2,653,271.00 based upon Enron's alleged obligations under the ENA Guaranty;
WHEREAS, on October 7, 2002, Norske Skog filed proof of claim number 6896 (together with claim number 6894, the "ENA Claims") against ENA in the amount of $7,067,728.0 on account of the amounts allegedly due under the ENA Agreements;
WHEREAS, on October 7, 2002, Norske filed proof of claim number 6895 (together with claim number 6893, the "Guarantee Claims") against Enron in the amount of $7,067,728.00 based upon Enron's alleged obligations under the ENA Guaranty;
WHEREAS, on or about August 12, 2002, Norske transferred its interest in proofs of claim numbers 6893, 6894, 6895, and 6896 (collectively, the "Claims") to Merrill Lynch, Pierce, Fenner, Smith Incorporated ("Merrill") with the notice of the transfer of the Claims being filed on November 27, 2002;
WHEREAS, on or about December 31, 2003, Merrill transferred its interest in the Claims to Longacre Master Fund Ltd. ("Longacre Master");
WHEREAS, on or about November 29, 2004, Longacre Master transferred its interest in the Claims to Longacre Capital Partners (QP), L.P. ("Longacre Capital");
WHEREAS, on July 15, 2004, this Court confirmed the Fifth Amended Joint Plan of Affiliated Debtors Pursuant to Chapter 11 of the United States Bankruptcy Code, dated January 9, 2004, as modified on June 1, 2004 and July 2, 2004 (the "Plan");
WHEREAS, the Plan is now effective;
WHEREAS, Section 28.2 (the "Compromise Election") of the Plan allows, inter alia, holders of certain guarantee claims for guarantees executed between December 2, 2000 and December 2, 2001 to compromise and settle pending litigation concerning such claims at a discount of the allowed amount of the claim, if any, which election was not made by Longacre Capital or any of its predecessors in interest;
WHEREAS, ENA and Longacre Master had also previously agreed on the reduction and allowance of the ENA Claims in a letter agreement dated June 16, 2004 (the "Letter Agreement") approved by the Court in the Order Granting the Debtors' Fourth Omnibus Motion for Approval of Compromise and Settlement of Claims by Letter Agreement Pursuant to Federal Rule of Bankruptcy Procedure 9019 entered on the docket on September 30, 2004 (the "Letter Agreement Order"), whereby claim number 6894 was allowed in the amount of $2,603,271 and claim number 6896 allowed in the amount of $7,017,728;
WHEREAS, Longacre Capital has agreed to settle the Guaranty Claims consistent with the terms of the Compromise Election;
NOW THEREFORE, IT IS HEREBY STIPULATED AND AGREED by and between the undersigned parties and their respective counsel as follows:
1. All recitals are incorporated herein by reference and are a part of this agreement.
2. Claim number 6893 is allowed as a prepetition, general unsecured claim against Enron in class 185 in the amount of $1,301,635.50 which represents a reduction of 50% of the allowed amount of claim number 6894.
3. The Claim Number 6895 is allowed as a prepetition, general unsecured claim against Enron in class 185 in the amount of $3,508,864.00 which represents a reduction of 50% of the allowed amount of claim number 6896.
4. This Stipulation and Order shall become effective and binding as of entry of this Stipulation and Order on the docket as "so ordered" by the Court. In the event that this Stipulation and Order is not approved by the Court, it shall be null and void and have no force or effect.
5. The parties to this Stipulation and Order agree that nothing herein is intended to alter or amend the terms or enforceability of the Letter Agreement and/or the Letter Agreement Order.
6. The parties agree that this Stipulation and Order shall be of no evidentiary value whatsoever in any other proceedings unless such proceedings are related to the allowance of the claims addressed herein or the enforceability and or terms of this Stipulation and Order.
7. This Court shall retain jurisdiction with respect to any and all issues or disputes that may arise in connection with this Stipulation.
8. This Stipulation and Order shall be governed by, construed and enforced in accordance with the laws of the State of New York except as governed by the Bankruptcy Code and Federal Rules of Bankruptcy Procedure.
9. This Stipulation and Order sets forth the entire understanding of the parties hereto and is intended to be the complete and exclusive statement of the terms thereof and may not be modified or amended except by a writing signed by all the parties hereto, which shall be so-ordered by the Court.
10. This Stipulation and Order may be executed in any number of counterparts and shall constitute one agreement, binding upon all parties thereto as if all parties signed the same document; all facsimile signatures shall be treated as originals for all purposes.
SO ORDERED.