Bankruptcy No. BK-S-00-10533-LBR, Jointly AdministeredUnited States Bankruptcy Court, D. Nevada
April 5, 2000
James Patrick Shea, Candace C. Carlyon, Shea Carlyon, Ltd., Las Vegas, NV, and William P. Weintraub, Pachulski, Stang, Ziehl, Young Jones, P.C., San Francisco, CA, Counsel for Debtors and Debtors-in-Possession
Marjorie A. Guymon, Goldsmith Guymon, P.C., Las Vegas, NV, and Gilbert L. Hamberg, Esq., Yardley, PA, Counsel for Pacific Gas
STIPULATION AND ORDER BETWEEN THE DEBTORS AND PACIFIC GAS AND ELECTRIC COMPANY REGARDING ADEQUATE ASSURANCE OF PAYMENT OF POST-PETITION UTILITY CHARGES
LINDA B. RIEGLE, United States Bankruptcy Judge
The parties set forth below stipulate and agree as follows:
WHEREAS, on January 25, 2000 (the “Petition Date”), Agribiotech, Inc., and its subsidiaries, the debtors and debtors-in-possession (collectively, the “Debtors”), filed voluntary petitions for relief under chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”) in the United States Bankruptcy Court for the District of Nevada, Southern District (the “Court”) The Debtors are operating their businesses and managing their properties as Debtors-in-Possession pursuant to sections 1107(a) and 1108 of the bankruptcy Code.
WHEREAS, Pacific Gas Electric Company (“PGE”) provides natural gas and electric utility services to the Debtors in California at the accounts set forth in attached Exhibit 1 (the “Accounts”).
WHEREAS, on February 1, 2000, the Debtors filed an Emergency Motion for Entry of Order Determining Adequate Assurance of Payment for Future Utility Services (the “Motion”).
WHEREAS, on February 7, 2000, the Court issued an Interim Order Determining Adequate Assurance of Payment for Future Utility Services (the “Interim Order”), pending resolution at hearing on the notion on March 8, 2000.
WHEREAS, in opposition to the Motion, on March 6, 2000, PGE filed a Verified Objection and Incorporated Memorandum of Law For Order Determining Adequate Assurance of Payment for Future Utility Services, and on March 14, 2000, PGE filed a Supplemental Verified Objection to the Motion (collectively, the “Objection”).
WHEREAS, in response to the Objection, the Debtors filed a Reply to the Objection (the “Reply”).
WHEREAS, hearings on the Motion, the objection, and the Reply were held on March 8, 2000 and March 22, 2000.
WHEREAS, the Debtors and PGE have reached a resolution of the issues outstanding between them related to adequate assurance of payment of post-petition charges, as set forth below.
NOW THEREFORE, in consideration of the foregoing, the Debtors and PGE hereby agree and stipulate as follows:
1. Notice and opportunity for hearing on this Stipulation and Order are adequate and proper.
2. Effective upon the Court’s signing of this Stipulation and Order, this Stipulation and Order, and not the Interim Order, shall govern the terms of adequate assurance of payment for the provision of post-petition utility services from PGE to the Debtors. As to PGE and its provision of post-petition services to the Debtors, this Stipulation and Order, once signed by the Court, thereby resolves the Motion, the Objection, and the Reply.
3. The Debtors shall make all payments to PGE, which are required under this Stipulation and Order, as follows: (a) do Kim Estlin, Credit Collections Department, PGE, 8110 Lorraine Avenue, Stockton, California 95210; Phone: (209) 955-7218; Fax: (209) 955-7339; and (b) via cash, check, certified check, or cashier’s check.
4. PGE shall send the following items to the Debtors, as follows:
(a) By first class U.S. Mail, all monthly invoices (“Invoices”) to: Mr. Nate Cann, AgriBioTech, Inc. 120 Corporate Park Drive, Henderson, Nevada 89014.
(b) By facsimile transmission, all reconciliation statements (“Reconciliation Statements”) and all default notices (“Default Notices”) to: (i) Nate Cann, AgriBioTech, Inc. 120 Corporate Park Drive, Henderson, Nevada 89014; Phone: (702) 566-2440; Fax: (702) 566-2458; (ii) William P. Weintraub, Esq, Pachulski, Stang, Ziehl, Young Jones, 650 California Street, 15th Floor, San Francisco, California 94108; Phone; (415) 263-7000; Fax: (415) 263-7010; and (iii) Jeffrey N. Pomerantz, Esq., Pachulski, Stang, Ziehl, Young Jones, 10100 Santa Monica Boulevard, Suite 1100, Los Angeles, California 90067; Phone (310) 277-6910; Fax: (310) 201-0760.
5. As for the period from January 25, 2000 to March 9, 2000, (the “Pre-Advance Payment Period”), the estimated total amount of PGE’s services is $3,243.04 (the “Pre-Advance Payment”).
(a) On or before March 15, 2000, the Debtors shall pay to PGE the Pre-Advance Payment.
(b) No later than the 15th to 20th of April 2000, PGE shall read the meters for the Accounts, compute the actual amounts of the invoices for the Pre-Advance Payment Period, and send to the Debtors reconciliation Statements, which set forth the accounting (amounts paid and their application) to show whether compared with the actual meter readinqs, the Pre-Advance Payment either was too low, in which event an underpayment would exist (an “Underpayment”), or the Pre-Advance Payment was too high, in which event an overpayment would exist (an “Overpayment”).
(c) If an Underpayment exists, then the Debtors shall pay same to PGE in the amounts set forth in the Reconciliation Statement, together with the very next Advance Payment (as defined in ¶ 6, below) due; however, if an Overpayment exists, then the Debtors shall receive a credit for same, in the amount set forth in the Reconciliation Statement, against the very next Advance Payment due.
6. As for each monthly service period from March 1, 2000 and continuing thereafter throughout the post-petition period (the “Advance Payment Period”), the Debtors shall pay PGE thirty (30) days in advance for utility services to the Accounts (each payment, an “Advance Payment”), as follows:
(a) On March 15, 2000, the amount of $5,417.50, which represents an estimated payment for service to the Accounts from March 10 to March 31, 2000.
(b) No later than on or about the 15th to the 20th of April 2000, PGE shall read the meters for the Accounts, compute the actual amounts of the Invoices for the preceding Advance Payment period, and then send to the Debtors a Reconciliation Statement, which sets forth whether an Underpayment (Advance Payment was less than the actual amount due) should be added to or any Overpayment (Advance Payment was greater than the actual amount due) should be subtracted from the very next Advance Payment due.
(c) Thereafter, each Advance Payment shall be received by PGE on the first (1st) day of each month, or the immediately-preceding business day if the first (1st) is a weekend or a legal holiday, as set forth in the applicable rules, regulations, tariffs, statutes, laws, and customary billing procedures governing electric and natural gas utilities in California (the “Regulations”). The exact amount due for each Advance Payment shall be set forth in a Reconciliation Statement, which shall be sent to the Debtors no later than ten (10) to fifteen (15) days before each Advance Payment is due. In no event shall each Advance Payment be due sooner than ten (10) days from the date that a Reconciliation Statement is faxed by PGE (with electronic confirmation of successful completion) to the Debtors.
(d) Under this Stipulation and Order, the Debtors shall not pay the amounts set forth in the Invoices or when such amounts otherwise would be due thereunder; rather, the Debtors shall pay the amounts set forth in the Reconciliation Statements on or before the due dates set forth therein.
7. Except for the Pre-Advance Payment and the Advance Payment due on March 15, 2000, as to which the Debtors acknowledge there is no dispute, if the Debtors dispute the amounts set forth in any Invoice or Reconciliation Statement, then the procedures set forth in the Regulations to resolve same shall apply. If the Debtors prevail as to such a dispute, then PGE either shall credit the applicable Account(s) or issue a refund check with respect to such disputed amount, less any amount due for unpaid, post-petition Invoices, as provided for under the Regulations.
8. If the Debtors do not timely and fully pay any Advance Payment (each a “Default”), subject, however, to ¶ 7, above, and such Default is not cured within seventeen (17) days from the date that a Default Notice is faxed by PGE (with electronic confirmation of successful completion) to the Debtors, then PGE may terminate its post-petition utility services to the Accounts, without further order of the Court. Nothing in this paragraph shall limit the parties’ recourse to the Court with respect to this Stipulation and Order.
9. If PGE requests the Debtors to provide access to their premises so that it can implement appropriate measures to so terminate its utility services to the Accounts, then the Debtors shall cooperate and provide PGE with access to their premises, as provided under the Regulations.
10. Any undisputed charge for utility services provided by PGE to the Debtors post-petition shall constitute an administrative expense in accordance with sections 503(b)(1)(A) and 507(a)(1) of the Bankruptcy Code.
11. If service to the Debtors is terminated by PGE in accordance with the terms of this Stipulation and Order due to nonpayment of the full amount of any Advance Payment, subject to ¶¶ 7 and 8, above, then PGE shall not reconnect service, unless and until the Debtors pay to PGE the amounts outstanding, PGE’s reconnection fees, and a $10,835.00 post-petition security deposit (or the appropriate reduced amount, if less than all of the Accounts are reconnected). Thereafter, the Advance Payment procedures set forth herein shall terminate, PGE shall implement normal, monthly invoice procedures, the Debtors shall pay timely and fully the amounts set forth in the Invoices, and in the event of any payment default(s), PGE shall provide only seven (7) days’ notice of default by first class United States mail only to the Debtors, at the address set forth in ¶ 4(a), above, and if such default(s) is not cured timely and fully, then PGE again may terminate services to the Debtors, without further order of the Court.
12. Within either seven (7) days of the entry of the order confirming the Debtors’ plan of reorganization; i.e., assuming that at that time, any of the Accounts still remain on line with the Debtors as the customer of record, or such later date as the Debtors become aware of the information set forth, below, the Debtors shall provide in writing to PGE, at the address set forth in ¶ 3(a), above, and to PGE’s undersigned counsel: (a) the effective date of such confirmed plan of reorganization; and (b) the name and address of the newly-reorganized company, if any.
13. This Stipulation and Order shall be effective upon signature by the Court and shall survive any conversion of the Debtors’ instant cases under chapter 11 of the Bankruptcy Code to chapter 7 of the Bankruptcy Code.
14. Except for names, addresses, telephone numbers, and fax numbers set forth herein, which may be changed by either party, as the case may be, by sending a written notice to the other party setting forth any such change, this Stipulation and Order contains the entire agreement between the parties with respect to the subject matter herein and may not be changed, amended, modified, or altered, except by written agreement signed by each party and approved by the Court, or as otherwise ordered by the Court. No representations have been made or relied upon by the parties, except as set forth herein.
15. This Stipulation and Order is subject to the approval of the Court.
SO ORDERED, this 5th day of April 2000.