Case No. 02-40045 (JHS), Jointly Administered with Case No. 02-40046 (JHS).United States Bankruptcy Court, N.D. Illinois, Eastern Division.
May 4, 2004
Joseph D. Frank, Attorney.
STIPULATED ORDER RE: ALLOWANCE OF CLAIM FOR REJECTION DAMAGES RELATED TO BEVERAGE SALES AGREEMENT BETWEEN DEBTOR AND PEPSI-COLA COMPANY
JOHN SQUIRES, Bankruptcy Judge
Clark Retail Enterprises, Inc. (“CRE”) debtor and debtor in possession in the above-captioned cases, on the one hand, and Pepsi-Cola Company on the other hand, hereby stipulate and agree as follows:
RECITALS
A. CRE entered into a “Beverage Sales Agreement” (the “Agreement”) with Pepsico, Inc., through its division known as Pepsi-Cola Company (“Pepsi”), on or about June 1, 2002. Pursuant to the Agreement, CRE agreed to purchase certain fountain product (“Product”) from Pepsi for sale in its gas stations and convenience stores (“Stores”). In addition, Pepsi also provided certain dispensing equipment (the “Equipment”) to CRE for use in the Stores. The Agreement had a variable term, which terminated on the later of: (i) August 15, 2007; or (ii) at such time as CRE’s total Product purchases reached a specified number of gallons.
B. On October 15, 2002 (the “Petition Date”), CRE and its parent, Clark Retail Group, Inc. (together, the “Debtors”) filed petitions for relief under chapter 11 of the Bankruptcy Code.
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C. On June 10, 2003, the Bankruptcy Court entered an order (the “Auction Procedures Order”) approving certain procedures by which National Real Estate Clearinghouse, Inc. (“NRC”) would conduct an auction (the “Auction”) of all of CRE’s Stores which were not previously closed or sold through private sale transactions previously approved by this Court in the first 6 months of CRE’s chapter 11 case. As of the date of this Stipulation, CRE no longer owns or leases any of the Stores.
D. On September 23, 2003, the Bankruptcy Court entered the “Omnibus Order Pursuant To 11 U.S.C. § 105 And 365 And F.R.Bankr.P. 6006 And 9014: (A) Authorizing Debtor To Reject [57] Executory Contracts Relating To Debtor’s Sold Or Closed Stores; And (B) Establishing Procedures For Rejection Of Additional Executory Contracts” (the “Omnibus Rejection Order”). The Omnibus Rejection Order authorizes CRE to reject executory contracts on ten days’ written notice to the applicable contract party.
E. On April 6, 2004, CRE provided written notice to Pepsi of its intent to reject the Agreement, effective as of April 20, 2004. CRE and Pepsi have now agreed that Pepsi’s claim for damages based on the rejection of the Agreement (the “Pepsi Rejection Claim”) should be allowed pursuant to the terms of this Stipulation.
STIPULATION
NOW, THEREFORE, IT IS HEREBY STIPULATED AND AGREED by and between CRE and Pepsi that:
1. The recitals above are true and correct and are hereby incorporated herein by this reference.
2. The Pepsi Rejection Claim shall be allowed in the amount of $2,500,000.00.
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3. Pepsi’s right to recover any amount based upon the Pepsi Rejection Claim is strictly limited to its right to be paid by the Debtors or their estates, at such time and according to such terms as other general unsecured claims against the Debtors’ estates are paid, if ever.
4. Neither Pepsi nor CRE shall be entitled to recover any further amount or damages from one another or any other party based upon any claim arising under the Agreement and/or relating to: (i) the rejection of the Agreement; or (ii) incentive payments or other amounts or obligations due under the Agreement.
5. Except as otherwise specifically provided herein, all rights, remedies, and defenses of the parties hereto are hereby preserved and shall not be prejudiced by anything not explicitly addressed herein.
6. Nothing contained in this Stipulation shall create any rights, remedies, or defenses in favor of any party in interest that is not a party to this Stipulated Order.
7. Nothing contained in this Stipulated Order shall constitute, or be deemed to constitute, an admission on the part of any party hereto.
8. The Court shall retain jurisdiction over any and all disputes, controversies, claims, or other matters arising under or otherwise relating to this Stipulated Order.
9. This Stipulated Order is the entire agreement between the parties in respect of the subject matter hereof, and may be signed in counterpart originals.
10. This Stipulated Order shall not become effective until it has been approved by the Bankruptcy Court.
AGREED.
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ORDER
The foregoing Stipulated Order is approved and made the Order of this Court.