Opinion
Case No. 01-16034 (AJG), Jointly Administered.
June 24, 2005
ORDER APPROVING SETTLEMENT AGREEMENT BETWEEN ENRON CORP., ENRON NORTH AMERICA CORP. AND WACHOVIA, N.A. PURSUANT TO FED. R. BANKP. P. 9019
Upon the motion dated May 13, 2005 (the "Motion") of Enron Corp. ("Enron") and Enron North America Corp. ("ENA"), as Reorganized Debtors, for an order approving a compromise and settlement of claims and disputes between ENA, Enron and Wachovia, N.A. ("Wachovia") relating to two employee-related trusts, the Retention Trust and the Deferral Trust, including certain claims asserted by ENA against Wachovia relating to the Retention Trust in an adversary proceeding pending in the United States Bankruptcy Court for the Southern District of Texas (Adversary Proceeding No. 03-4183), in accordance with the terms of the written settlement agreement attached to the Motion as Exhibit A and incorporated herein (the "Settlement Agreement"), pursuant to Rule 9019 of the Federal Rules of Bankruptcy Procedure, and it appearing to the Court that timely and sufficient notice of the Motion has been provided to all parties of interest, that such notice is sufficient under the circumstances, and that no other or further notice is necessary; and the Court, having reviewed the Motion, having heard the arguments of counsel at the Hearing, and having determined that granting the relief requested is in the best interest of the Reorganized Debtors, their estates, and creditors, and is a proper exercise of the Reorganized Debtors' business judgment; and good and sufficient cause exists to grant the Motion in its entirety and approve the Settlement Agreement; and pursuant to Federal Rule Bankruptcy Procedure 9019(a) and Sections 105(a) and 363(f) of the Bankruptcy Code, approving therefore
Unless otherwise defined, capitalized terms herein have the meanings ascribed to them in the Settlement Agreement.
IT IS HEREBY FOUND AND DETERMINED THAT:
A. The Court has jurisdiction to consider the Motion and relief requested therein pursuant to 28 U.S.C. §§ 157 and 1334. Venue is proper before this Court pursuant to 28 U.S.C. §§ 1408 and 1409;
B. Proper, timely, adequate and sufficient notice of the Motion has been provided to all persons, including all Deferral Trust Beneficiaries and all Retention Trust Beneficiaries, necessary in accordance with Bankruptcy Rules 2002 and 9019, and 9013-1(c) of the Local Bankruptcy Rules for the Southern District of New York (the "Local Rules"), the orders of this Court and applicable law for the Court to grant the relief requested and Wachovia to obtain the releases and other benefits provided in the Settlement Agreement; notice was good and sufficient and appropriate under the circumstances and no other or further notice of the Motion is required;
C. A reasonable opportunity to object or be heard with respect to the Motion and relief requested therein and this Order has been afforded to all those persons necessary as described in paragraph B above;
D. The Settlement Agreement was negotiated at arm's length and proposed and entered into by and between ENA, Enron and Wachovia without collusion and in good faith;
E. The settlements and compromises embodied in the Settlement Agreement are based on reasonable and sound business judgment and in the best interest of the Reorganized Debtors and their estates' creditors, and good cause exists to grant the Motion and approve the Settlement Agreement in its entirety;
F. No benefits are due and owing to any Deferral Trust Beneficiary from the Deferral Trust Fund;
G. Enron is Insolvent as such term is defined in Section 3 of the Deferral Trust Agreement;
H. Termination of the Deferral Trust is required (a) in good faith to comply with applicable law and (b) under Section 14 of the Deferral Trust Agreement, and accordingly should be approved;
I. The transfer of funds by Wachovia from the Deferral Trust to Enron is proper under the Bankruptcy Code and the Reorganized Debtors' confirmed chapter 11 plan, and constitutes a transfer for the benefit of Enron's creditors within the meaning of, and as required by, the Deferral Trust Agreement and applicable law;
J. The discharge of Wachovia respecting the Deferral Trust as provided for in Article 3 of the Settlement Agreement is proper and accordingly should be approved;
K. No Retention Trust Beneficiary is entitled to any further payment from the Retention Trust Fund;
L. The termination of the Retention Trust in accordance with the Retention Trust Agreement and the discharge of Wachovia respecting the Retention Trust as provided for in Article 3 of the Settlement Agreement are proper and accordingly should be approved;
M. Wachovia's distribution of the remainder of the Retention Trust Fund to ENA, after payment to Wachovia of accrued trustees' fees, professional fees and other expenses as provided for in the Settlement Agreement, is proper under the Retention Trust Agreement and accordingly should be approved;
N. The discharge of Wachovia respecting the Retention Trust as provided for in Article 3 of the Settlement Agreement is proper and accordingly should be approved;
O. ENA and Enron have title, free and clear of any and all claims, liens and encumbrances, to any and all of the Released Claims; and
P. The relief sought in the Motion is in the best interests of Enron, ENA, their estates, creditors, and all parties in interest.
ACCORDINGLY, IT IS BY THIS COURT HEREBY
ORDERED that the findings of fact set forth above and the conclusions of law pursuant to Bankruptcy Rule 7052, made applicable to this proceeding pursuant to Bankruptcy Rule 9019. To the extent any finding of fact shall be determined to be a conclusion of law, it shall be so deemed, and to the extent any conclusion of law later shall be determined to be a finding of fact, it shall be so deemed; and it is further
ORDERED that the Motion is approved and GRANTED in its entirety; and it is further
ORDERED that the terms, conditions and provisions of the Settlement Agreement, as attached to the Motion as Exhibit A, are hereby approved without modification and incorporated by reference herein; and it is further
ORDERED that ENA and Enron are authorized and directed to (i) enter into the Settlement Agreement and (ii) take any and all actions and provide such cooperation reasonably necessary to satisfy the conditions precedent set forth in Article 6 of the Settlement Agreement, execute and file the Stipulation of Dismissal and effectuate and comply with the other terms of the Settlement Agreement, which terms are deemed to have the force of an order of this Court; and it is further
ORDERED that the releases given pursuant to Article 4 of the Settlement Agreement shall be effective upon satisfaction of the conditions precedent set forth in Article 6 of the Settlement Agreement and entry of the Stipulation of Dismissal; and it is further
ORDERED that the Deferral Trust and Retention Trust are hereby terminated and Wachovia is hereby discharged as trustee for such trusts as set forth in Article 3 of the Settlement Agreement; and it is further
ORDERED that, after payment of all claims, expenses, charges, liabilities and obligations of the Retention Trust (including any trustee's fees, attorneys' fees and other expenses required by Article 8 of the Settlement Agreement), Wachovia shall distribute all remaining funds in the Retention Trust to Enron as Reorganized Debtor; and it is further
ORDERED that, after payment of all claims, expenses, charges, liabilities and obligations of the Deferral Trust (including any trustee's fees, attorneys' fees and other expenses required by Article 8 of the Settlement Agreement), Wachovia shall distribute all remaining funds in the Deferral Trust to ENA as Reorganized Debtor; and it is further
ORDERED that the limited survival of trustee indemnity rights set forth in Article 7 of the Settlement Agreement and the assumptions by ENA and Enron, as Reorganized Debtors, of such indemnity obligations are approved; and it is further
ORDERED that Wachovia shall have no liability to any person, including without limitation any Deferral Trust Beneficiary or any Retention Trust Beneficiary, for distribution of funds as required by the Settlement Agreement and this Order; and it is further
ORDERED that this Court shall retain jurisdiction over any matter or dispute arising from or relating to the implementation of this Order.
SO ORDERED.