Opinion
Case No. 01-16034 (AJG), Jointly Administered.
May 12, 2005
George J. Bunze, CORNER BROOK PULP AND PAPER LIMITED, Graham Goldsmith, MERRILL LYNCH, PIERCE, FENNER SMITH INCORPORATED, Victor S. Khosla, Strategic Value Partners, LLC, Its Investment Advisor, MOORE U.S. RESTRUCTURING, L.P., Victor S. Khosla, Strategic Value Partners, LLC, Its Investment Advisor, STRATEGIC VALUE MASTER FUND, LTD. and H. Rey Stroube, III (Pro Hac Vice), Jeffrey M. Anapolsky (JA 8867), AKIN GUMP STRAUSS HAUER FELD LLP, Houston, Texas, Attorneys for Merrill Lynch, Pierce, Fenner Smith Inc.
Martin J. Bienenstock (MB 3001), Brian S. Rosen (BR 0571), Melanie Gray (Pro Hac Vice), WEIL GOTSHAL MANGES LLP, New York, New York, Attorneys for the Reorganized Debtors.
Enron Corp. ("Enron") and Enron North America Corp. ("ENA" and, together with Enron, the "Enron Parties"), as reorganized debtors, on the one hand, and Moore U.S. Restructuring L.P. ("Moore"), and Strategic Value Master Fund, Ltd. ("Strategic Value" and, together with Moore, the "Creditors"), as assignees of Corner Brook Pulp and Paper Limited ("Corner Brook") and Merrill Lynch, Pierce, Fenner Smith Incorporated ("Merrill"), on the other hand, by and through their respective undersigned counsel, hereby stipulate and agree as follows:
RECITALS:
Procedural Background:
A. On December 2, 2001 (the "Petition Date"), 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 (the "Bankruptcy Code"). From and after the Petition Date, the Debtors managed and operated their businesses as debtors-in-possession pursuant to Bankruptcy Code sections 1107 and 1108.
B. On July 15, 2004, the Court entered an order (the "Confirmation Order") confirming the Supplemental Modified Fifth Amended Joint Plan of Affiliated Debtors Pursuant to Chapter 11 of the United States Bankruptcy Code, dated as of July 2, 2004 (the "Plan"). On November 17, 2004, the Plan became effective and the Debtors emerged from chapter 11 (the "Reorganized Debtors").
The Proofs of Claim:
C. On or about September 3, 2002, Corner Brook filed Proof of Claim No. 23222 in the amount of $8,982,000.00 in ENA's chapter 11 case (the "ENA Claim"). The ENA Claim is based upon certain newsprint commodity swap transactions between ENA and Corner Brook (the "Swap Transactions").
D. Corner Brook also filed Proof of Claim No. 3505 in the amount of $8,982,000.00 in Enron's chapter 11 case (the "Enron Claim" and, together with the ENA Claim, the "Claims"). The Enron Claim is based on a Guaranty, dated October 24, 2000, executed by Enron in favor of Corner Brook and covering the obligations of ENA under the Swap Transactions.
E. On or about April 14, 2004, Corner Brook assigned its interests in the Claims to Merrill. See Docket No. 17833. Merrill likewise assigned its interests with respect to $1,886,220.00 of the Claims to Moore and assigned its interests with respect to the remaining $7,095,780.00 of the Claims to Strategic Value. See Docket Nos. 21156 and 21157.
F. On or about March 8, 2005, the Reorganized Debtors filed an objection to the Claims (the "Objection"), pursuant to which the Reorganized Debtors sought to have the Claims reduced and allowed.
G. The Enron Parties and the Creditors (collectively, the "Parties") now desire to resolve the Objection on the terms and conditions provided herein.
AGREEMENT
NOW, THEREFORE, IT IS HEREBY AGREED BY THE PARTIES, BY AND THROUGH THEIR RESPECTIVE COUNSEL, AS FOLLOWS:
1. Proof of Claim No. 23222 shall be disallowed as filed, and (i) Moore shall receive an allowed Class 5 General Unsecured Claim in the amount of $1,260,000.00 (the "Moore ENA Allowed Claim") and (ii) Strategic Value shall receive an allowed Class 5 General Unsecured Claim in the amount of $4,740,000.00 (the "Strategic Value ENA Allowed Claim").
2. Proof of Claim No. 3505 shall be disallowed as filed, and (i) Moore shall receive an allowed Class 185 Enron Guaranty Claim in the amount of $1,260,000.00 (the "Moore Enron Allowed Claim") and (ii) Strategic Value shall receive an allowed Class 185 Enron Guaranty Claim in the amount of $4,740,000.00 (the "Strategic Value Enron Allowed Claim" and, together with the Moore ENA Allowed Claim, the Moore Enron Allowed Claim, and the Strategic Value Enron Allowed Claim, the "Allowed Claims").
3. Payments and/or distributions on account of the Allowed Claims will be made in the manner provided and at the time set forth in the Plan. All Scheduled Liabilities related to the Claims as set forth in the liability schedules filed with the Court are hereby disallowed in their entirety in favor of the Allowed Claims.
4. Enron and ENA waive, release, and forever discharge Corner Brook, Merrill, Moore and Strategic Value (the "Non-Debtor Parties") and their affiliates, and each of their past, present and future officers, directors, partners, members, employees, agents and servants, from any and all claims, obligations, damages, actions, causes of action and liabilities, losses, liens, suits, attorneys' fees, compensation or recoupment, of whatsoever kind and nature, character and description, whether in law or in equity, whether sounding in tort, contract or under applicable law, whether known or unknown, and whether anticipated or unanticipated, which Enron, ENA and their successors and assigns ever had, now have or may ever have, arising from or related to the ENA Claim, the Enron Claim, and/or the Swap Transactions (including any amendments thereto).
5. Except for the Allowed Claims, the Non-Debtor Parties waive, release, and forever discharge Enron, ENA and their past, present and future officers, directors, partners, members, employees, agents and servants, from any and all claims, obligations, damages, actions, causes of action, liabilities, losses, liens, suits, attorneys' fees, compensation or recoupment, of whatsoever kind and nature, character and description, whether in law or in equity, whether sounding in tort, contract or under applicable law, whether known or unknown, and whether anticipated or unanticipated, which the Non-Debtor Parties and their successors and assigns ever had, now have or may ever have, arising from or related to the ENA Claim, the Enron Claim, and/or the Swap Transactions (including any amendments thereto).
6. Each of the Parties 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.
7. The Stipulation and Order shall become effective and binding as 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.
8. This Court shall retain jurisdiction with respect to any and all issues or disputes that may arise in connection with this Stipulation and Order.
9. This Stipulation and Order shall be binding on the Parties hereto and their respective successors and assigns.
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.