BK-S-00-19258 LBRUnited States Bankruptcy Court, D. Nevada
October 8, 2002
JAMES D. GREENE, ESQ., KOLESAR LEATHAM, CHTD., Las Vegas, Nevada, LEO T. CROWLEY, ESQ., LYNN RYAN, ESQ., PILLSBURY WINTHROP LLP, New York, New York, Attorneys for Creditor WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, as trustee for TOMBO AVIATION INC.
STIPULATION AND ORDER REGARDING ENGINE REPAIRS
LINDA B. RIEGLE, United States Bankruptcy Judge
This Stipulation is entered into between Debtor National Airlines, Inc. (“Debtor”), by and through its counsel, Laurence Frazen, Esq. of the law firm of Bryan Cave LLP and Wells Fargo Bank Northwest, National Association (“Lessor”) as trustee for Tombo Aviation, Inc. (“Tombo”), by and through its counsel, James D. Greene, Esq. of the law firm of Kolesar Leatham, Chtd.
RECITALS
1. On December 6, 2000 (the “Filing Date”), the Debtor filed a petition for relief under Chapter 11, Title 11 of the United States Code (the “Bankruptcy Code”).
2. The Debtor is in possession of its assets and operates, and intends to continue to operate, its business as a debtor-in-possession pursuant to Sections 1107(a) and 1108 of the Bankruptcy Code.
3. The Debtor entered into an Aircraft Lease Agreement dated May 31, 2000 with the Lessor with respect to a Boeing 757 aircraft with a tail number of N526NA and with two RB211-535E4 engines bearing Serial Numbers 30746 and 30747 installed thereon (the “Aircraft”). The parties to this Stipulation agree that Lessor (and not the Debtor) is the owner of the Aircraft and all of its component parts.
4. The 60-day time period provided for in 11 U.S.C. § 1110(a)(1) with respect to this Aircraft would have expired on February 5, 2001. The Debtor and Lessor have agreed to several prior stipulations regarding the forbearance of Lessor’s “fly away rights,” although presently there is no such stipulation in effect.
5. On or about January 30, 2002, the parties to this Stipulation entered into a Stipulation and Agreed Order Regarding Maintenance Procedures for Repairs of Engine (“January Stipulation”) which stipulation governed repairs for an engine on Lessor’s aircraft, Model RB211-535E4, engine serial number 30747 (“Engine”).
6. The Engine was sent pursuant to the terms of the January Stipulation to Texas Aero Engine Services Limited at Forth Worth, Texas (“TAESL”) and the repairs have been completed.
7. The Debtor is in default under the January stipulation in that it has failed to pay for the repairs and, as of August 19, 2002 there remained an outstanding balance owed by National to TAESL of $149,830.92 (“Engine Repair Sum”), which amount had been due to TAESL since June 2002.
8. The Debtor and Tombo desire that the Engine be replaced in the Aircraft.
9. Tombo has paid the Engine Repair Sum to TAESL and the Engine has been released to the Debtor and replaced on the Aircraft.
10. The Debtor has agreed to promptly reimburse Tombo for the Engine Repair Sum and to pay to Tombo by wire transfer the Engine Repair Sum as stated above within two (2) business days of the first funding under the Debtor’s debtor-in-possession financing facility, but in no event later than October 31, 2002.
11. The parties further agree that this Stipulation shall be binding on any trustee that my be appointed, whether in the event of conversion of the case to Chapter 7 or in Chapter 11.
12. The Debtor agrees that it shall not request, require or demand that any sums owed to Tombo for the Engine Repair Sum be deferred, converted to equity, included in preexisting claims, nor shall the Debtor request or seek any other modification of its obligation to reimburse Tombo for the Engine Repair Sum other than as proposed in this Stipulation.
ORDER
The court having reviewed the foregoing stipulation by and between the parties and good cause appearing,
IT IS HEREBY ORDERED that the foregoing Stipulation is APPROVED and that the Debtor is authorized and directed to pay the sum of $149,830.92 to Tombo on or before September 6, 2002 as and for reimbursement of the Engine Repair Sum.