IN RE PHOENIX RESTAURANT GROUP, INC. (Bankr.M.D.Tenn. 2005)

Jointly Administered Bankruptcy Case No. 301-12036, Adv. Proc. No. 303-0658A.United States Bankruptcy Court, M.D. Tennessee, Nashville Division.
March 8, 2005.

Beth A. Dunning, DUNNING LAW GROUP, PLLC, Brentwood, Tennessee, Counsel for the Consolidated Debtors acting by and through the Plan Administrator.

Ainy Reily Sathusti GEART, PORTER DONOVAN, P.C. Addison, Texas, Counsel for Defendant and Towne North.

AGREED ORDER OF SETTLEMENT AND DISMISSAL
KEITH LUNDIN, Bankruptcy Judge

This matter is before the Court upon the Complaint (the “Complaint”)[2] filed by Phoenix Restaurant Group, Inc. (“PRG”) and the PRG affiliates (with PRG, collectively, the “Consolidated Debtors”)[3] against Henry S. Miller Multi-Management Inc. (the “Defendant”; and with the Consolidated Debtors and Towne North Partners S/C, Ltd., collectively, the “Parties”),

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which Complaint seeks avoidance and recovery of certain payments under sections 547 and 550 of the United States Bankruptcy Code, 11 U.S.C. §§ 101–1330 (the “Bankruptcy Code”). Based upon the agreements, acknowledgements, stipulated facts, and conclusions of the Parties set forth below, which are evidenced and acknowledged by the signatures of the Parties on this Order, the record herein, and all other circumstances, therefore,

THE COURT FINDS, ADJUDGES AND DECREES:

A. The Complaint seeks to avoid and recover the value of certain payments (the “Payments”) made to the Defendant for the benefit of Towne North N/C Partners, Ltd. (“Towne North”) prior to the commencement of these bankruptcy cases.

B. The Consolidated Debtors and the Defendant and Towne North have agreed to a settlement and resolution (the “Settlement”) of all factual and legal issues in this adversary proceeding.

C. Pursuant to the Settlement and in partial consideration therefor, the Defendant and Towne North the agreed to pay to the Consolidated Debtors the amount of $7,000.00 (the “Settlement Amount”).

D. Pursuant to the Settlement and in partial consideration therefor, the Defendant and Towne North have expressly agreed to voluntarily waive (the “Claim Waiver”) the following claims against the Consolidated Debtors (the “Waived Claims”):

(i) any and all claims identified by the Consolidated Debtors on any schedules or amended schedules filed under 11 U.S.C. §§ 521(1) or 1106(a)(2) in these bankruptcy cases;

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(ii) notwithstanding any rights of the Defendant or Towne North under 11 U.S.C. § 502(h), any and all claims arising from the payment of the Settlement Amount; and
(iii) any and all other claims, causes of action, rights or defenses held or asserted by the Defendant or Towne North against the Consolidated Debtors, whether secured, unsecured, prepetition, postpetition, administrative, priority, or otherwise against the Consolidated Debtors or their estates, and whether or not such claims have already been asserted or might be asserted in the future against the Consolidated Debtors, and whether or not such claims are evidenced by a proof of claim filed in these bankruptcy cases.

E. The Defendant and Towne North expressly acknowledge and agree that the Defendant and Towne North understand the effect of the Claim Waiver and that such Claim Waiver was agreed to only after the Defendant and Towne North had adequate opportunity to consult with counsel of the Defendant’s and Towne North’s choosing regarding the legal rights and each and the effect of such Claim Waiver.

F. In consideration of the Settlement Amount and the Claim Waiver, the Consolidated Debtors have agreed to dismiss the Complaint against the Defendant and release the Defendant and Towne North from any further liability on the allegations raised in the Complaint.

G. Sections 21.12 and 18.12.5 of the confirmed Plan, among others, grant the Plan Administrator discretion to resolve all claims and controversies in these bankruptcy cases on behalf of the Consolidated Debtors, without further notice, hearing or Court authority.

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H. Dismissal of the Complaint against Defendant, on the terms set forth in this Order, is appropriate under all of the circumstances.

THEREFORE, THE COURT ORDERS, ADJUDGES AND DECREES:

1. The Defendant and Towne North immediately pay the Consolidated Debtors the Settlement Amount and the effectiveness of this order as a dismissal of the Complaint aganist the Defendant shall be and is expressly conditioned upon the receipt by the Consolidated Debtors of the Settlement Amount in cash or other legal tender of good funds transferred to the possession and control of an authorized agent of the Consolidated Debtors.

2. In accordance with the knowing and voluntary Claim Waiver by the Defendant and Towne North, the Waived Claims shall be DISALLOWED in their entirety and the Defendant and Towne North shall not have and are forever barred from asserting, liquidating, collecting on or receiving a distribution on the Waived Claims and the Consolidated Debtors are hereby released and forever discharged from the Waived Claims.

3. The Court hereby dismisses this adversary proceeding against the Defendant, conditioned upon the Parties’ compliance with all of the terms of the Settlement, and the terms of this Order, the Parties having agreed and represented, as confirmed by the signatures of authorized representatives of the Parties below, that their assent to any particular term in the Settlement is conditioned upon and consideration for the other terms, the severance of any one of which the Parties represent would negate their agreement to the Settlement.

4. If the Defendant or Towne North breaches the terms of this Order or the Settlement and/or withdraws or stops payment on any tender of the Settlement Amount and/or fails to immediately pay the full Settlement Amount, then the limitation of liability and other benefits granted to the Defendant in this Order shall be null, void and of no effect, and

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the Consolidated Debtors shall be entitled to have this Order vacated, to reinstitute this adversary proceeding and/or to otherwise fully pursue the causes of action set forth in the Complaint, as if no Settlement had occurred, along with any claims for damages suffered by the Consolidated Debtors or their estates, and in any such circumstance, the Defendant and Towne North shall be barred from asserting any defense to such actions on the basis of the Settlement or any term set forth this Order.

5. Except to the extent a particular claim is specifically allowed or disallowed by the terms of this Order, neither the agreement of the Consolidated Debtors to the Settlement nor the terms of this Order shall be deemed to be a waiver, judicial determination, res judicata or preclusive, of any rights that the Consolidated Debtors might otherwise have to object or otherwise dispute, on any grounds, any claim asserted by the Defendant or Towne North.

6. Neither the Settlement nor the terms of this Order shall affect or diminish any rights the Consolidated Debtors might otherwise have against any person or entity other than the Defendant or Towne North.

7. The Courtt shall retain jurisdiction to hear any matters or disputes arising from or relating to the Agreed Order of Dismissal.