Opinion
Case No. 01-16034 (AJG).
October 3, 2005
CADWALADER, WICKERSHAM TAFT LLP, Special Counsel to the Debtors, New York, NY.
Mark C. Ellenberg, Washington, D.C., Special Counsel to the Reorganized Debtors.
HAZELWOOD POWER, David Quinn, Attorney-in-Fact and Chief Executive Officer, Melbourne VIC, Australia, Attorney for Hazelwood.
STIPULATION AND ORDER
Enron Corp. ("Enron"), as Reorganized Debtor, and Hazelwood Power ("Hazelwood," and together with Enron, the "Parties"), by and through their respective undersigned attorneys, hereby stipulate and agree as follows:
Capitalized terms used herein without definition shall have the meaning given to such terms in the Plan (as defined hereinafter).
RECITALS :
1. On December 2, 2001, and from time to time thereafter, Enron and certain of its direct and indirect subsidiaries (collectively, the "Debtors") filed voluntary petitions for relief under chapter 11 of title 11 of the United States Code, 11 U.S.C. §§ 101 et seq. (the "Bankruptcy Code").
References to the Debtors include the Reorganized Debtors (as defined in the Plan), where appropriate.
2. On July 15, 2004, the Court entered an order confirming the Supplemental Modified Fifth Amended Joint Plan of Affiliated Debtors Pursuant to Chapter 11 of the United States Bankruptcy Code, dated July 2, 2004 (the "Plan"). On November 17, 2004, the Plan became effective, and the Reorganized Debtors emerged from chapter 11.
Proof of Claim and Claim Objection:
3. On or about October 15, 2002, Hazelwood filed a proof of claim in the amount of US$3,069,521.00 in Enron's chapter 11 case, which was assigned claim no. 20336 (the "Claim").
4. The Claim arises from a guaranty dated as of May 1, 2001 given by Enron to Hazelwood in respect of the obligations of Enron Australia Finance Pty Ltd ("EAF") under certain business transactions with Hazelwood and EAF. EAF is a company incorporated in New South Wales, Australia, currently in liquidation proceedings under chapter 5 of the Corporations Act 2001 (Commonwealth of Australia) (the "Liquidation Proceedings"). Hazelwood is a creditor of EAF in the Liquidation Proceedings.
5. On or about March 11, 2005, the Reorganized Debtors filed their Ninety-First Omnibus Objection to Proof of Claims (No Amount Due Per Debtors' Books and Records and Insufficient Proof) (the "Objection"), pursuant to which the Reorganized Debtors sought to have the Claim disallowed and expunged.
6. The Parties thereafter agreed on numerous extensions of the deadline for the filing of Hazelwood's response to the Objection, and ultimately agreed to an indefinite extension of such deadline in order to allow the Parties to engage in settlement discussions. To this end, the Court entered an Order, dated May 5, 2005 (the "Extension Order"), providing that the Objection to the Claim, as identified on Exhibit D to the Extension Order, would be resolved by stipulation or letter agreement to be submitted to the Court at a later date.
7. The Parties now desire to resolve the Objection in accordance with the Extension Order and provide for the allowance of the Claim on the terms and conditions provided herein.
AGREEMENT
NOW THEREFORE, IT IS HEREBY STIPULATED AND AGREED BY THE PARTIES, BY AND THROUGH THEIR RESPECTIVE ATTORNEYS, AS FOLLOWS:
8. The Claim, identified by the Debtors as claim no. 20336, shall be classified as an Allowed General Unsecured Claim in Class 4 General Unsecured Claims under the Plan in the amount of US$3,069,521.00 (the "Allowed Claim"). All scheduled liabilities related to Hazelwood as set forth in Enron's schedule of assets and liabilities filed with the Clerk of the Bankruptcy Court on June 17, 2002, pursuant to Bankruptcy Rules 1007 and 1009 shall be deemed disallowed in their entirety and replaced by the Allowed Claim.
9. Distribution on the Allowed Claim shall be made in accordance with the terms of the Plan, including without limitation, that Hazelwood shall receive, as part of the first Distribution to be made to Hazelwood, those amounts required to have been held on its account pursuant to section 21.3 of the Plan.
10. Enron's liability in respect of the Allowed Claim shall not be reduced or otherwise affected by any distribution received by Hazelwood in the Liquidation Proceedings, provided however, that if the aggregate amount received by Hazelwood in connection with (a) its claims against EAF in the Liquidation Proceedings and (b) any Distributions on the Allowed Claim, exceeds the total Australian dollar amount of the principal debt owed by EAF to Hazelwood, including related interest and out-of-pocket expenses incurred by Hazelwood in respect of the Liquidation Proceedings, Hazelwood shall pay to Enron the amount equal to such excess in US dollars as soon as practical after receipt of such excess amounts. For purposes of the Paragraph 3 calculation, the value of any Distributions made on the Allowed Claim of Hazelwood under the Plan shall be converted into Australian dollars at a rate equal to the spot rate of exchange as at the date of such Distribution according to any foreign exchange selected by Hazelwood in good faith.
11. This Stipulation and Order, and any Distributions made to Hazelwood in accordance herewith and under the Plan, are without prejudice to and shall have no effect on Hazelwood's claims against EAF.
12. Each of the Parties waives any and all of its rights under section 502(j) of the Bankruptcy Code and agrees not to seek any such reconsideration or amendment of the Allowed Claim after entry of this Stipulation and Order by the Court.
13. Enron and Hazelwood agree that this Stipulation and Order is the entire understanding of the Parties 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.
14. The Stipulation and Order shall become effective and binding as of the date of entry of the 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 and effect.
15. This Court shall retain jurisdiction with respect to any and all issues or disputes that may arise in connection with this Stipulation and Order.
16. This Stipulation and Order shall be binding on the Parties hereto and their respective successors and assigns.
SO ORDERED.