Opinion
Case No. 01-16034 (AJG), Jointly Administered
April 15, 2003
Upon the motion (the "Motion") of Enron Corp. and its affiliated above-captioned debtors and debtors in possession (collectively, the "Debtors") seeking entry of an order pursuant to sections 327(a), 328(a) and 363 of title 11 of the United States Code, 11 U.S.C. § 101 et seq. (the "Bankruptcy Code") and Rules 2014, 2016 and 6005 of the Federal Rules of Bankruptcy Procedure (the "Bankruptcy Rules"), authorizing and approving the Debtors' employment and retention of Phillips Son Neal Auctions Limited ("Phillips") as auctioneer and sales agent pursuant to the terms of the agreement by and among the Debtors and Phillips dated as of March 28, 2003 (the "Phillips Agreement") and the terms of compensation to Phillips as set forth in the Phillips Agreement; and the Court having reviewed the Motion and the Affidavit of Simon de Pury (the "Affidavit"); and the Court having jurisdiction over this matter pursuant to 28 U.S.C. § 157 and 1334; and this is a core proceeding pursuant to 28 U.S.C. § 157(b)(2); and due and proper notice of the Motion having been given in accordance with the Court's Amended Case Management Order Establishing, Among Other Things, Noticing Electronic Procedures, Hearing Dates, Independent Website and Alternative Methods of Participation at Hearings, dated February 26, 2002, and no other or further notice need be provided; and the relief requested in the Motion being in the best interest of the Debtors and their estates and creditors; and the Court having reviewed the Motion and the Affidavits and having determined that the legal and factual bases set forth therein establish just cause for the relief granted herein; and upon all the proceedings had before the Court in these cases and after due deliberation and sufficient cause appearing therefor, it is
ORDERED, that the Motion is granted; and it is further
ORDERED, that in accordance with sections 327(a), 328(a), 330 and 363 of the Bankruptcy Code and Bankruptcy Rules 2014, 2016 and 6005, the Debtors are authorized and empowered to retain and employ Phillips as an auctioneer in these chapter 11 cases to assist in the sale of the Enron Art (as defined in the Motion), and to perform any necessary services related thereto as may be requested by the Debtors and as described in the Phillips Agreement attached as Exhibit "1" to the Motion for the sale of the Enron Art; and it is further
ORDERED, that as set forth herein, the Debtors are authorized to consummate transactions for the sale of Enron Art pursuant to the Phillips Agreement on the terms and subject to the conditions set forth in the Phillips Agreement without need for further notice of motion; and it further
ORDERED, that all of the Enron Art that is sold by Phillips shall be sold free and clear of all claims, liens and encumbrances (the "Liens") pursuant to Bankruptcy Code section 363(f), with such Liens, if any, to transfer and attach to the proceeds thereof with the same priority and validity as may have existed prior to the date of the sale; and it is further
ORDERED, that all of the Enron Art sold by Phillips shall be sold on an "as is, where is" basis without any representations or warranties; and it is further
ORDERED, that Phillips shall provide, in advance of each auction, an auctioneer or surety bond in favor of the United States of America for an amount equal to an estimated proceeds for each auction. The bond shall be in a form acceptable to the U.S. Trustee, Phillips and the Debtors; and it is further
ORDERED, that Phillips, as provided in the Phillips Agreement, shall file a Report with the Court no less than fifteen (15) days after an auction or other sale, which shall include any compensation and reimbursement of expenses to be paid to Phillips, and provide copies to the Debtors, the United States Trustee, counsel for the Committee, counsel for the Debtors' debtor in possession lenders, counsel for the ENA Examiner and counsel for the Examiner. Any party in interest shall have any opportunity to object to each Report, including objections to Phillips' compensation and reimbursement of expenses pursuant to section 330 of the Bankruptcy Code, provided that any objection to the Report must be filed with the Court and served upon the Debtors and Phillips by overnight courier or facsimile so that objections are received by 5:00 p.m. (EST) on the tenth (10th) business day following Phillips' service of the Settlement Report; and it is further
ORDERED, that unless an objection to the Report is interposed as set forth herein, Phillips shall receive the compensation and expense reimbursement as set forth in the Report without further order of the Court; and it is further
ORDERED, that pursuant to sections 105(a) and 1146(c) of the Bankruptcy Code, the sale of Enron Art shall be exempt from, and neither the Debtors nor the purchasers of Enron Art be required to pay, any transfer, recording or other similar taxes that would otherwise be due and owing; and it is further
ORDERED, that except to the extent required to repay the DIP Obligations pursuant to and in accordance with the Final Order and the Documents, all proceeds received by the Debtors in connection with the sale of Enron Art shall be retained by the Debtors and be neither disbursed nor used until the earlier to occur of (i) agreement by and between the Debtors and the Creditors' Committee with respect to the release of such proceeds and (ii) further Order of the Court; and it is further
Capitalized terms used herein and not defined herein or in the Motion shall have the meanings ascribed to them in the Final Order Authorizing Debtors to Obtain Post-Petition Financing pursuant to 11 U.S.C. § 105, 361, 362, 364(c)(1), 364(c)(2), 364(c)(3) and 364(d)(1), dated July 2, 2002 (the "Final Order").
ORDERED, that the final allocation proceeds of the sale of the Enron Art shall be determined by further Order of this Court; and it is further
ORDERED, that the ten-day stay of any order authorizing the sale of property established by Bankruptcy Rule 6004(g) shall not apply to this order or to the sale of Surplus Assets and this Order is immediately effective and enforceable; and it is further
ORDERED, that no less than fifteen (15) business days after termination of the Phillips' Agreement, Phillips shall file with the Court and serve upon the Debtors, the U.S. Trustee and the Creditors' Committee a final settlement report (the "Final Settlement Report") setting forth, in detail, all sales conducted by Phillips, the proceeds received from such sales, the compensation and any reimbursement of expenses paid to Phillips for all sales and the amounts remitted to the Debtors' estates; and it is further
ORDERED, that any party in interest shall have any opportunity to object to the Final Settlement Report, including objections to Phillips' compensation and/or reimbursement of expenses pursuant to section 330 of the Bankruptcy Code, provided that any objection to the Final Settlement Report must be filed with the Court and served upon the Debtors and Phillips by overnight courier or facsimile so that objections are received by 5:00 p.m. (EST) on the tenth (10th) business day following Phillips' service of the Final Settlement Report; and it is further
ORDERED, that unless an objection to the Final Settlement Report is interposed as set forth herein, Phillips shall receive the compensation and reimbursement of expenses as set forth in the Final Settlement Report without further order of the Court; and it is further
ORDERED, that any and all requests by Phillips for payment of indemnity pursuant to the Phillips Agreement shall be made by means of an Motion to the Bankruptcy Court and shall be subject to the review by the Bankruptcy Court to ensure that payment of such indemnity conforms to the terms of the Phillips Agreement and is reasonable based upon the facts and circumstances of the litigation or settlement for which indemnity is sought; provided, however, that in no event shall Phillips be indemnified for acts of its own bad-faith, self-dealing, breach of fiduciary duty, negligence, gross negligence or willful misconduct; in no event shall Phillips be indemnified if the Debtors or representatives of the Debtors' estates assert (or the Committee asserts on behalf of the Debtors' estates) a claim for, and a Court determines by final Order that, such claim arose from Phillips' own bad-faith, self-dealing, breach of fiduciary duty, gross negligence or willful misconduct; in no event shall the Debtors' indemnification liability exceed the Net Sale Proceeds (as defined in the Phillips Agreement) received by the Debtors from the sale of Enron Art pursuant to the Phillips Agreement, plus reasonable attorneys' fees; and it is further
ORDERED, that any inconsistency between this Order and the Phillips Agreement shall be governed by this Order; and it is further
ORDERED, that the Debtors are authorized and empowered to take all actions necessary to implement the relief granted in this Order; and it is further
ORDERED, that this Court shall retain jurisdiction to hear and determine all matters arising from the implementation of this Order.