Opinion
Case No. 01-16034 (AJG), Jointly Administered.
July 7, 2005
Edward A. Smith, CADWALADER, WICKERSHAM TAFT LLP, New York, New York, and Mark C. Ellenberg, Washington, DC, Special Counsel to the Debtors.
William T. Russell, Jr., Kathrine A. McLendon, SIMPSON THACHER BARTLETT LLP, New York, New York, Attorneys for American Electric Power Company, Inc., AEP Desert Sky GP, LLC and AEP Desert Sky LP, LLC.
ORDER APPROVING SETTLEMENT AMONG ENRON WIND DEVELOPMENT LLC, AMERICAN ELECTRIC POWER COMPANY, INC., AEP DESERT SKY GP, LLC AND AEP DESERT SKY LP, LLC
Upon consideration of debtor Enron Wind Development LLC's Motion Pursuant to Bankruptcy Rule 9019 For Approval of Settlement Among Enron Wind Development LLC, American Electric Power Company, Inc. ("AEP"), AEP Desert Sky GP, LLC ("ADSG"), and AEP Desert Sky LP, LLP ("ADSL" and collectively with AEP and ADSG, the "AEP Parties"); and the Court having jurisdiction to consider the Motion and the relief requested therein pursuant to 28 U.S.C. §§ 157 and 1334, and pursuant to section 38.1 of the Supplemental Modified Fifth Amended Plan of Affiliated Debtors Pursuant to Chapter 11 of the United States Bankruptcy Code, dated as of July 2, 2004; and it appearing that due and proper notice of the Motion and the relief requested therein having been given in accordance with this Court's Second Amended Case Management Order Establishing, Among Other Things, Noticing Electronic Procedures, Hearing Dates, Independent Website and Alternative Methods of Participation at Hearings, dated December 17, 2002, and no other or further notice need be given; and the relief requested in the Motion being in the best interests of Enron Wind Development LLC (the "Debtor") and its estate and creditors; and the Court having reviewed the Motion; and the Court having determined that the legal and factual bases set forth in the Motion establish just cause for relief granted herein and that the settlement is fair and reasonable, and after due deliberation and sufficient cause appearing therefor, it is
ORDERED that the Motion is granted in all respects, and it is further
ORDERED that the Stipulation By And Between Enron Wind Development LLC And American Electric Power Company, Inc., AEP Desert Sky GP, LLC and AEP Desert Sky LP, LLC Concerning Purchase and Sale Agreement, attached hereto as Exhibit A (the "Stipulation"), is authorized and approved pursuant to Rule 9019 of the Federal Rules of Bankruptcy Procedure, and it is further
ORDERED that the Debtor is authorized to execute, deliver, implement and fully perform any and all obligations, instruments, documents and papers and to take any and all actions reasonably necessary to consummate the Stipulation and perform any and all obligations contemplated therein, and it is further
ORDERED that the Court shall retain exclusive jurisdiction to (i) enforce and implement the terms and provisions of the Stipulation and (ii) resolve any disputes arising under or in connection with the Stipulation and any related documents. Furthermore, the Court shall retain exclusive jurisdiction to interpret, implement, and enforce the provisions of this Order, and it is further
ORDERED that all objections to the Motion or the relief requested therein that have not been withdrawn, waived, or settled, and all reservations of rights included therein, are overruled on the merits. Those parties who did not object, or who withdrew their objections, to the Motion are deemed to have consented to the Motion, and it is further
ORDERED that the failure to specifically include any particular provisions of the Stipulation in this Order shall not diminish or impair the effectiveness of such provisions, it being the intent of the Court that the Debtor's implementation of the transactions contemplated in the Stipulation be approved in its entirety, and it is further
ORDERED that the stay of this Order provided by the Bankruptcy Rules (including Bankruptcy Rule 6004) whether for ten (10) days or otherwise shall not be applicable to this Order, and this Order shall be effective and enforceable immediately upon entry.
EXHIBIT A STIPULATION BY AND AMONG ENRON WIND DEVELOPMENT LLC AND AMERICAN ELECTRIC POWER COMPANY, INC., AEP DESERT SKY GP, LLC AND AEP DESERT SKY LP, LLC CONCERNING PURCHASE AND SALE AGREEMENTRECITALS:
A. Commencing on December 2, 2001 and periodically thereafter, Enron Wind Development LLC ("EWD") successor to Enron Wind Development Corp., together with its parent, Enron Corp. ("ENE"), and certain of ENE's other affiliates (collectively, the "Debtors"), filed voluntary petitions for relief under chapter 11 of title 11 of the United States Code (the "Bankruptcy Code").
B. On July 15, 2004, the United States Bankruptcy Court for the Southern District of New York ("Bankruptcy 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 (the "Plan"), and on November 17, 2004 the Plan became effective.
Purchase and Sale Agreement
C. On December 28, 2001, the Bankruptcy Court authorized a Purchase and Sale Agreement (the "Sale Agreement") between EWD, certain of EWD's affiliates, AEP Desert Sky GP, LLC ("ADSG") f/k/a AEP Indian Mesa GP, LLC and AEP Desert Sky LP, LLC ("ADSL" together with ADSG, "Desert Sky Partners") f/k/a AEP Indian Mesa LP, LLC for the sale of Indian Mesa I and Indian Mesa II Partnership Interests in certain wind-powered energy generating facilities (the "Facilities") in the amount of $175 million — (Docket 543).
D. Pursuant to Section 3.2(c) of the Sale Agreement, Desert Sky Partners retained $3.7 million in reserve (the "Holdback") for any unreimbursed curtailment of energy that prevents the Facilities from delivering energy to a power grid.
Excepted Claims
E. In addition to the foregoing, American Electric Power Company, Inc. ("AEP") and certain of its affiliates filed various proofs of claim, which are listed on Exhibit A (the "Excepted Claims"), against ENE and certain other ENE affiliates. The parties agree that this stipulation (this "Stipulation") shall not affect the Excepted Claims or the Debtors' right to dispute, contest, object to and/or litigate the Excepted Claims.
F. The parties have negotiated a resolution of their respective rights and obligations in accordance with the provisions of this Stipulation.
AGREEMENT:
In consideration of the foregoing and the mutual promises contained herein, EWD, Desert Sky Partners and AEP hereby stipulate and agree as follows:
1. Within seven (7) business days after this Stipulation is approved by the Bankruptcy Court (the "Effective Date"), Desert Sky Partners (or other entity designated by Desert Sky Partners) shall make a payment to EWD in the amount of $3,800,091.00 plus per diem interest in the amount of $548 accruing from June 10, 2005 (the "Settlement Payment") by wire transfer of immediately available funds in United States dollars without deduction, offset or counterclaim of any kind, in accordance with the wire transfer instructions given by EWD. The Settlement Payment represents the curtailment payments plus interest for 2002, 2003 and 2004 due under the Sale Agreement with respect to the Holdback, as well as the agreed curtailment payment for 2005, which would have been due in 2006 under the Sale Agreement with respect to the Holdback.
2. As of the Effective Date, Desert Sky Partners and AEP, on behalf of themselves and their respective predecessors, respective successors and assigns, together with their respective past, present and future officers, directors, partners, principals, members, employees, agents, servants, attorneys and shareholders (collectively, the "AEP Parties"), hereby waive, release and forever discharge any and all Claims (as defined in section 101(5) of the Bankruptcy Code), and any and all causes of action against EWD and its respective predecessors, and each of their respective past, present and future officers, directors, partners, principals, members, employees, agents, servants and attorneys (collectively, the "Enron Releasees"), and are hereby barred from asserting any and all Claims and causes of action, of whatsoever kind and nature, character and description, whether known or unknown, presently existing, whether or not asserted, and whether found in fact or law or in equity, existing at any time, arising out of, arising as a result of, related to, with respect to or in connection with or based in whole or in part on the Sale Agreement or the Holdback; provided, however, that nothing in this release or this Stipulation shall serve to or be deemed to release, waive or discharge the Claims and/or causes of action related to the Excepted Claims or affect, modify or restrict the AEP Parties' and their affiliates' respective rights to prosecute, defend and/or litigate, or the Debtors' and their affiliates' respective rights to dispute, contest, object to and/or litigate, the Excepted Claims and/or any cause of action relating thereto; provided, further, that nothing contained herein shall constitute a release of the Enron Releasees' respective obligations under this Stipulation; and provided further, that nothing contained herein shall release any claims that any of the AEP Parties may have against General Electric Company and its affiliates.
3. As of the Effective Date, the Enron Releasees hereby waive, release and forever discharge any and all Claims and any and all causes of action, including, without limitation, any claims and causes of action arising out of the above-captioned Debtors' avoidance powers under Chapter 5 of the Bankruptcy Code (collectively, the "Causes of Action") against the AEP Parties, and are hereby barred from asserting any and all Claims and Causes of Action, of whatsoever kind and nature, character and description, whether known or unknown, presently existing, whether or not asserted, and whether found in fact or law or in equity, existing at any time, arising out of, arising as a result of, related to, with respect to or in connection with or based in whole or in part on the Sale Agreement or the Holdback; provided, however, that nothing in this release or this Stipulation shall serve to or be deemed to release, waive or discharge the Claims and/or causes of action related to the Excepted Claims or affect, modify or restrict the AEP Parties' and their affiliates' respective rights to prosecute, defend and/or litigate, or the Debtors' and their affiliates' respective rights to dispute, contest, object to and/or litigate, the Excepted Claims and/or any cause of action relating thereto; provided, further, that nothing contained herein shall constitute a release of the AEP Parties' respective obligations under this Stipulation.
4. This Stipulation is subject to approval of the Bankruptcy Court and shall be of no force and effect unless and until it is approved.
5. This Stipulation may not be amended or modified except by written agreement of the parties hereto and further order of the Bankruptcy Court.
6. This Stipulation and all of the provisions hereof shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns.
7. This Stipulation may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. A signature transmitted by facsimile or portable document format shall be deemed an original signature for purposes of this Stipulation.
8. Each of the parties hereby irrevocably consents to the jurisdiction of the Bankruptcy Court with respect to any action to interpret or enforce the terms and provisions of this Stipulation and expressly waives any right to commence any such action to interpret and enforce this Stipulation in another forum.
Exhibit A to Stipulation by and among Enron Wind Development LLC and American Electric Power Company, Inc., AEP Desert Sky GP, LLC and AEP Desert Sky LP, LLC Concerning Purchase and Sale Agreement — Excepted Claims Proof of Claim No. Creditor Debtor
Includes any liabilities unrelated to the Sale Agreement and Holdback that are listed in any of the Debtors' Schedules of Assets and Liabilities filed with the Bankruptcy Court.