Case No. 02-43582-H4-11, JOINTLY ADMINISTEREDUnited States Bankruptcy Court, S.D. Texas, Houston Division.
May 26, 2003
Alfredo R. Pérez, Lydia T. Protopapas, Shayne H. Newell, Houston, WEIL, GOTSHAL MANGES, LLP, Texas, Attorneys for Debtors and Debtors In Possession.
Richard A. Aguilar, McGLINCHEY STAFFORD, PLLC, New Orleans, Louisiana, Jennifer L. Davis, Houston, Texas, Attorneys for Automotive Rentals Inc.
STIPULATION AND ORDER REGARDING THE OBJECTIONS OF AUTOMOTIVE RENTALS, INC. TO CONFIRMATION OF THE SECOND AMENDED JOINT PLAN OF REORGANIZATION OF ENCOMPASS SERVICES CORPORATION AND ITS AFFILIATED DEBTORS UNDER CHAPTER 11 OF THE BANKRUPTCY CODE
WILLIAM GREENDYKE, Bankruptcy Judge.
[This document pertains to docket number 2430.]
TO THE HONORABLE UNITED STATES BANKRUPTCY JUDGE:
In order to resolve the ARI Objections (as hereinafter defined), Encompass Services Corporation and its affiliated Debtors (collectively, “Encompass” or the “Debtors”) and Automotive Rentals, Inc. (“ARI”) stipulate as follows:
RECITALS
WHEREAS, on November 19, 2002 (“Petition Date”), the Debtors filed voluntary petitions for relief under chapter 11 of title 11 of the United States Code (“Bankruptcy Code”). The Debtors continue to operate their businesses and manage their properties as debtors-in-possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code;
WHEREAS, on April 11, 2003, the Debtors filed their Second Amended Joint Plan of Reorganization, that was later modified and supplemented by, inter alia, (a) the Immaterially Modified Second Amended Joint Plan of Reorganization of Encompass Services Corporation and its Affiliated Debtors Under Chapter 11 of the Bankruptcy Code (the “Immaterially Modified Plan”), (b) the Plan Supplement, (c) the First Amended Plan Supplement, and (d) the Second Amended Plan Supplement (collectively, the “Plan Supplement”), all of which may be subsequently amended or modified in accordance with the terms of such plan and the Bankruptcy Code (all of the foregoing collectively, the “Plan”);
WHEREAS, on May 15, 2003, ARI filed its Objections to Confirmation of the Second Amended Joint Plan of Reorganization of Encompass Services Corporation and its Affiliated Debtors Under Chapter 11 of the Bankruptcy Code, which bears the pleading number 2430 on the docket of the captioned case (the “ARI Objections”);
WHEREAS, in order to resolve the ARI Objections so that the Court may enter the order confirming the Plan (the “Order”), at the May 21, 2003 confirmation hearing held in this above-captioned case, the Debtors and ARI read onto the record of the above-captioned case a stipulation and do hereby intend to memorialize such stipulation in good faith and at arms’ length and, therefore, desire that it shall be binding upon each of them, their successors, heirs, and assigns; and
WHEREAS, the Debtors and ARI believe that this Stipulation is in their respective best interests.
NOW THEREFORE, in consideration of the foregoing and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto stipulate and agree as follows:
STIPULATION
1. Notwithstanding anything contained in the Plan (including, without limitation, paragraph 13.16, of the Plan), the Disclosure Statement, or the Order to the contrary, the choice-of-law and “State Law” provisions contained in the contracts and/or agreements by and between Encompass and ARI, including, without limitation, any such agreements and/or contracts that have been or are hereafter rejected, assumed, and/or assumed and assigned by Encompass (collectively, the “ARI Agreements”), shall not be modified, amended, or otherwise affected in any way or manner by any choice-of-law provisions contained in the Plan or the Order.
2. Notwithstanding anything contained in the Plan, the Disclosure Statement, or the Order to the contrary, nothing in the Plan, the Disclosure Statement or the Order shall in any way or manner modify, amend, extinguish, terminate, cancel, or otherwise affect:
A. any insurance, including, without limitation, insurance against liability for bodily injury, that Encompass has provided, maintained or carried, or may provide, maintain or carry (i) for the benefit of (a) ARI, (b) the Debtors’ employees, and/or (c) others who operated, possessed, were passengers in, were injured by, realized any loss as the result of; or controlled any of; the property affected by the ARI Agreements, including, without limitation, vehicles leased to the Debtors; (ii) naming ARI as an insured and/or an additional insured; (iii) naming the Debtors as an insured and/or an additional insured; and/or (iv) naming any financing source as an insured or an additional insured; or
B. any of ARI’s rights to, claims against, entitlement to, or interests in the aforementioned insurance, including, without limitation. ARI’s ability to collect amounts from any insurer that may have issued such insurance.
3. Nothing in section 10.2(a)(5) of the Plan, section IV.K.2.a.(v), of the Disclosure Statement, or the Order shall affect in any respect any order, stipulation or written agreement, and as stated on the record at the May 21, 2003 confirmation hearing, entered into between the Debtors and ARI in connection with the captioned Bankruptcy Cases.
4. Any disputed claims for cure, including, without limitation, the amount of any rejection damages or other amounts arising under, among other things, the cross-default provisions contained in the ARI Agreements, and any defenses thereto, are reserved by the parties (the “Disputed Claims for Cure”), which Disputed Claims for Cure will be resolved by the Bankruptcy Court at the trial that will be held on Thursday, June 5, 2003, at 2:00 p.m.
5. Nothing contained in the Plan (including, without limitation, the definition of General Unsecured Claim[1] as set forth in, among other provisions, section 1.2 (64) of the Plan, and the language of section 7.7 of the Plan that provides that the “[a]ll Allowed Claims arising from the rejection of executory contracts and unexpired leases shall be treated as General Unsecured Claims under the Plan”), the Disclosure Statement, or the Order shall in any way or manner affect, impair, bar (including, without limitation, under the doctrines, defenses, and/or theories of res judicata, issue or claim preclusion, waiver, and/or estoppel), be considered a waiver of; or otherwise affect any past, presently pending, and future application, motion or claim by ARI that any amounts due to ARI, including, without limitation, any rejection damages and/or cure amounts, are entitled to the priority of, and are to be paid as, administrative expense claims (which motions, applications and claims include, without limitation, the Motion and Application of Automotive Rentals, Inc. For Recognition and Payment of Administrative Claim that is designated as pleading number 2142 on the docket of the captioned case), which past, currently pending, and future applications, motions and claims of ARI are hereby reserved and preserved.